PARRIS N. GLENDENING, Governor                                  Ch. 36

(4)      STOCKS, BONDS, OR OTHER SECURITIES ISSUED BY A
CORPORATION, OTHER THAN AN INSURER, IF A MAJORITY OF THE STOCK HAVING
VOTING POWERS OF THE ISSUING CORPORATION IS OWNED DIRECTLY OR
INDIRECTLY BY OR FOR THE BENEFIT OF ONE OR MORE OFFICERS OR DIRECTORS
OF THE INSURER; OR

(5)      AN INVESTMENT THAT THE COMMISSIONER FINDS IS AGAINST
PUBLIC POLICY OR DESIGNED TO EVADE A PROHIBITION OF THIS SECTION.

(B)     INVESTMENT IN CORPORATION OWNED BY INSURER.

(1)      AN INSURER MAY NOT DIRECTLY OR INDIRECTLY INVEST IN OR
LEND ITS FUNDS ON SECURITY OF STOCKS, BONDS, OR OTHER SECURITIES ISSUED
BY A CORPORATION, IF A MAJORITY OF THE OUTSTANDING STOCK OF THE
CORPORATION, OR A MAJORITY OF THE STOCK HAVING VOTING POWERS OF THE
CORPORATION, IS OR WILL BE AFTER THE ACQUISITION DIRECTLY OR INDIRECTLY
OWNED:

(I)      BY THE INSURER OR BY OR THROUGH ONE OR MORE OF THE
INSURER'S OFFICERS OR DIRECTORS HOLDING THE STOCK FOR THE BENEFIT OF
THE INSURER OR ITS STOCKHOLDERS;

(II)     BY A PARENT CORPORATION OR SUBSIDIARY OF THE
INSURER, THE PARENT CORPORATION, OR SUBSIDIARY OF THE PARENT
CORPORATION; OR

(III)    BY ANY COMBINATION OF THE INSURER, ITS PARENT
CORPORATION, ITS SUBSIDIARIES, OR ITS STOCKHOLDERS.

(2)      PARAGRAPH (1) OF THIS SUBSECTION DOES NOT PREVENT AN
INVESTMENT IN:

(I)      THE STOCK, BONDS, OR OTHER SECURITIES OF A
CORPORATION ORGANIZED EXCLUSIVELY TO HOLD AND OPERATE REAL ESTATE
ACQUIRED BY THE INSURER, IN ACCORDANCE WITH AND SUBJECT TO § 5-608 OF
THIS SUBTITLE;

(II)     THE STOCK OF ANOTHER INSURER; OR

(III)    THE STOCKS, BONDS, OR OTHER SECURITIES OF A
CORPORATION THAT IS ENGAGED EXCLUSIVELY IN A KIND OF BUSINESS PROPERLY
INCIDENTAL TO THE INSURANCE BUSINESS OF THE INSURER, INCLUDING AN
INVESTMENT IN THE SECURITIES OF A CORPORATION THAT IS ENGAGED IN THE
FINANCING OF INSURANCE PREMIUMS OR IN ANOTHER INCIDENTAL BUSINESS AND
IN THE BUSINESS OF HOLDING AND OPERATING REAL ESTATE.

(C)     FOREIGN INVESTMENT.

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