Ambac Financial Group (OSG) Proxy Filing summary

Executive summary

• A special meeting is called to approve the sale of all shares of Ambac Assurance Corporation (AAC) to American Acorn Corporation, owned by Oaktree Capital Management, for $420 million in cash, subject to adjustments.

• The board unanimously recommends approval of the sale, an advisory vote on executive compensation related to the sale, and the right to adjourn the meeting if more votes are needed.

• The sale is considered a disposition of substantially all assets under Delaware law and requires majority shareholder approval.

• Proceeds will be used to repay acquisition funding, cover transaction costs, initiate a $50 million share repurchase program, and for general corporate purposes, including further acquisitions.

• Following the sale, the company will focus on specialty property and casualty insurance and insurance distribution businesses.

Voting matters and shareholder proposals

• Shareholders will vote on: (1) the sale of AAC, (2) advisory approval of executive compensation in connection with the sale, and (3) the right to adjourn the meeting to solicit more votes if needed.

• Approval of the sale requires a majority of outstanding shares; the compensation and adjournment proposals require a majority of votes cast.

• No appraisal or dissenters' rights are available to shareholders.

Board of directors and corporate governance

• The board unanimously supports all proposals and recommends a "FOR" vote.

• After the sale, the board and most senior executives will remain, except for two executives transferring to the buyer.

• The buyer will have the right to designate one director to the board upon exercising more than 50% of the warrant and holding at least 4% of common stock.