§ 21.35. Acquisitions and dispositions pursuant to mergers and consolidations.
(a) As used in this section, the term ‘‘merger’’ shall include the sale or purchase of substantially all the assets of one insurer by another in exchange for stock which is then distributed to the security holders of the insurer which sold its assets.
(b) The following transactions shall be exempt from section 302.1(2) of the act (40 P. S. § 422.1(2)):
(1) The acquisition of a security of an insurer under a merger or consolidation and in exchange for a security of a company which prior to the merger or consolidation owned 85% or more of the equity securities of all other companies involved in the merger or consolidation except, in the case of consolidation, the resulting company.
(2) The disposition of a security under a merger or consolidation of an insurer which prior to the merger or consolidation owned 85% or more of the equity securities of all other companies involved in the merger or consolidation except, in the case of consolidation, the resulting company.
(3) The acquisition of a security of an insurer pursuant to a merger or consolidation and in exchange for a security of a company which prior to such merger or consolidation held over 85% of the combined assets of all the companies undergoing merger or consolidation, computed according to their book values prior to the merger or consolidation, as determined by reference to their most recent available financial statements for a 12-month period prior to the merger or consolidation.
(4) The disposition of a security under a merger or consolidation of an insurer which prior to the merger or consolidation held 85% or more of the equity securities of all other companies involved in the merger or consolidation according to their book value prior to merger or consolidation, as determined by reference to their most recent available financial statements for a 12-month period prior to the merger or consolidation.
(c) Notwithstanding subsection (a), if an officer, director or stockholder makes any purchase (other than a purchase exempted by this section) of a security in any company involved in the merger or consolidation and any sale (other than a sale exempted by this section) of a security in any other company involved in the merger or consolidation within any period of less than 6 months during which the merger or consolidation took place, the exemption provided by this section shall be available to that officer, director or stockholder to the extent of the purchase and sale.
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