(a) For the purpose of subsection (b) of section 1221, and subject to the provisions of subdivision (b) of this section:

1. (1) the disposition of stock acquired though the exercise of a stock option, by means of an exchange offer made to all stockholders generally, shall not be the sale of such stock; and
2. (2) the acquisition of stock pursuant to the exercise of a stock option shall not be a purchase which may be matched with any stock theretofore or thereafter disposed of by the acceptance of such exchange offer.

(b) The exemptions conferred by subdivision (a) shall apply only if the following conditions are met:

1. (1) the plan under which the option is granted and exercised was approved by the superintendent pursuant to section 1207;
2. (2) the disposition of such stock is made in exchange for stock or other securities; and
3. (3) the exchange offer is made in compliance with all applicable provisions of the Insurance Law, and rules and regulations promulgated thereunder.