Ambac Assurance Corporation (“Ambac Assurance”) today announced
that, following a hearing held on June 4, 2012, the Circuit Court for
Dane County, Wisconsin (the “Rehabilitation Court”) approved two motions
submitted by the Wisconsin Commissioner of Insurance, acting as the
Rehabilitator of the Segregated Account of Ambac Assurance (the
“Segregated Account”).
The first motion sought to allow the Segregated Account to begin paying
in cash 25% of each permitted policy claim that has arisen since the
commencement of the rehabilitation proceedings for the Segregated
Account and of each policy claim submitted and permitted in the future.
Ambac Assurance anticipates beginning to make these claim payments in
the third quarter of 2012.
The second motion sought approval to permit Ambac Assurance to exercise
two call options to purchase approximately $789 million of surplus notes
issued by Ambac Assurance. Today, Ambac Assurance issued exercise
notices relating to one call option on $500 million of surplus notes,
expiring on June 7, 2012. Ambac Assurance anticipates exercising the
remaining call option before its expiry date on November 30, 2012.
Ambac Assurance
Ambac Assurance is a guarantor of public finance and structured finance
obligations, and is the principal operating subsidiary of Ambac
Financial Group, Inc. (“Ambac”).
Ambac, headquartered in New York City, is a holding company whose
affiliates provided financial guarantees and financial services to
clients in both the public and private sectors around the world. On
November 8, 2010, Ambac filed a petition for relief under Chapter 11 of
the United States Bankruptcy Code (“Bankruptcy Code”) in the United
States Bankruptcy Court for the Southern District of New York
(“Bankruptcy Court”). The Bankruptcy Court entered an order confirming
Ambac’s plan of reorganization on March 14, 2012. Ambac is not currently
able to estimate when it will be able to consummate such plan. Upon
consummation of the plan of reorganization, Ambac’s existing common
stock will be cancelled and extinguished and the holders thereof will
not be entitled to receive, and will not retain, any property or
interest on account of such common stock. Until the plan of
reorganization is consummated and Ambac emerges from bankruptcy, Ambac
will continue to operate in the ordinary course of business as
“debtor-in-possession” in accordance with the applicable provisions of
the Bankruptcy Code and the orders of the Bankruptcy Court. Ambac’s
common stock trades in the over-the-counter market under ticker symbol
ABKFQ.
