PARRIS N. GLENDENING, Governor                                   Ch. 36

(I)      ALL PRIOR OBLIGATIONS, AND PRIOR PREFERRED STOCK, IF
ANY, OF THE INSTITUTION AT THE DATE OF ACQUISITION BY THE INSURER ARE
ELIGIBLE AS INVESTMENTS UNDER THIS ARTICLE;

(II)     FOR PREFERRED STOCK:

1.        THE NET EARNINGS OF THE INSTITUTION AVAILABLE
FOR FIXED CHARGES FOR A PERIOD OF 5 FISCAL YEARS IMMEDIATELY PRECEDING
THE DATE OF ACQUISITION BY THE INSURER MUST HAVE AVERAGED EACH YEAR
NOT LESS THAN ONE AND ONE-HALF TIMES THE SUM OF ANY AVERAGE ANNUAL
FIXED CHARGES, ANY AVERAGE ANNUAL MAXIMUM CONTINGENT INTEREST, AND
THE AVERAGE ANNUAL PREFERRED DIVIDEND REQUIREMENT APPLICABLE TO THE
PERIOD; AND

2.        DURING EITHER OF THE LAST 2 YEARS OF THE 5-YEAR
PERIOD, THE NET EARNINGS MUST HAVE BEEN NOT LESS THAN ONE AND ONE-HALF
TIMES THE SUM OF THE INSTITUTION'S FIXED CHARGES, CONTINGENT INTEREST,
AND PREFERRED DIVIDEND REQUIREMENT FOR THE YEAR; AND

(III)    FOR GUARANTEED STOCK, THE ASSUMING OR
GUARANTEEING INSTITUTION MEETS THE REQUIREMENTS OF SUBSECTION
(E)(2)(III) OF THIS SECTION CONSTRUED TO INCLUDE AS A FIXED CHARGE THE
AMOUNTS OF GUARANTEED DIVIDENDS OF THE ISSUE OR THE RENTAL COVERING
THE GUARANTEE OF THE DIVIDENDS.

(G) TRUSTEES' OR RECEIVERS' OBLIGATIONS.

THE RESERVE INVESTMENTS OF AN INSURER MAY INCLUDE CERTIFICATES,
NOTES, OR OTHER OBLIGATIONS, ADEQUATELY SECURED AS TO PRINCIPAL AND
INTEREST, ISSUED BY TRUSTEES OR RECEIVERS OF AN INSTITUTION CREATED OR
EXISTING UNDER THE LAWS OF THE UNITED STATES OR A STATE, THAT, OR THE
ASSETS OF WHICH, ARE BEING ADMINISTERED UNDER THE DIRECTION OF A COURT
HAVING JURISDICTION.

(H) EQUIPMENT TRUST OBLIGATIONS.

THE RESERVE INVESTMENTS OF AN INSURER MAY INCLUDE EQUIPMENT
TRUST OBLIGATIONS OR CERTIFICATES THAT ARE ADEQUATELY SECURED OR
OTHER ADEQUATELY SECURED INSTRUMENTS THAT EVIDENCE:

(1)      AN INTEREST IN TRANSPORTATION EQUIPMENT LOCATED WHOLLY
OR PARTLY IN THE UNITED STATES; AND

(2)      A RIGHT TO RECEIVE DETERMINED PARTS OF RENTAL, PURCHASE,
OR OTHER FIXED OBLIGATORY PAYMENTS FOR THE USE OR PURCHASE OF THE
TRANSPORTATION EQUIPMENT.

(I) ACCEPTANCES AND BILLS OF EXCHANGE.

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