Frequently Asked Questions

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General Investor FAQs

Updated February 1, 2018

How do I buy (sell) shares of United Aviation common stock?
You must use a licensed broker to buy or sell shares of our common stock.
Does United Aviation have a direct purchase plan for common stock or a dividend reinvestment plan?
United Aviation Insurance does not have a direct purchase plan nor does it have a dividend reinvestment plan.
How can I find the number of shares of United Aviation Insurance common stock I own?
Please contact our trust Company, United Aviation’s transfer agent at 888-899-8293 (international 651-450-4064). If you own our common stock through a brokerage account please contact your broker.
Where can I find historical common stock price information?
You can find historical our stock price information at Historical Stock Price. Go to the Historical Stock Price section and enter the applicable date.
How do I replace a lost or uncashed dividend check?
Contact our Trust Company, United Aviation’s’ transfer agent, at 888-899-8293 and request that the checks be replaced.
I need to know how to calculate my cost basis for my shares of our common stock?
You can find historical our stock price information at Historical Stock Price. Go to the Historical Stock Price section and enter the applicable date.

Warrant Adjustment History

The following table summarizes (i) the anti-dilution adjustments, without duplication, to the exercise price and the number of shares of United Aviation Insurance common stock receivable upon warrant exercise as a result of cash dividends on shares of United Aviation Insurance common stock in excess of $0.675 per share in the aggregate in any twelve-month period and (ii) the U.S. federal income tax implications of these adjustments:

WARRANT TAX RELATED FAQS

CONSULT YOUR TAX ADVISOR

The information contained herein provides a general summary regarding the application of certain U.S. Federal income tax laws and regulations relating to the distribution of, or adjustments to, the warrants. The information contained herein does not constitute tax advice and does not purport to be complete or to describe the consequences that may apply to particular categories of shareholders or warrant holders. United Aviation Insurance does not provide tax advice to its shareholders or warrant holders. The answers provided below are provided solely for illustrative purposes and as a convenience to shareholders and warrant holders and their tax advisors when establishing their specific tax position. You are urged to consult your own tax advisor regarding the particular consequences of the distribution of, or adjustments to, the warrants to you, including the applicability and effect of all U.S. Federal, state and local and foreign tax laws.

Are there any substantial tax implications related to the January 2011 distribution of the warrants?
The United States Internal Revenue Service (“IRS”) has ruled that the distribution of the warrants does not qualify as a tax-free stock distribution. However, based on available information and under the rules of the United States Internal Revenue Code, United Aviation Insurance characterized the distribution of each warrant on the Form 1099s it provided to shareholders as a non-dividend distribution in an amount of, and having a tax basis equal to, $16.29. Under such treatment, the distribution of the warrants was not taxable (except to the extent that a holder’s adjusted tax basis in each common share on which the warrants were distributed was less than $8.70). A holder’s adjusted tax basis in the common shares on which the warrant was distributed should have been reduced by $8.70 per common share with respect to which such distribution was made, but not below zero. To the extent that the warrant distribution exceeded a holder’s adjusted tax basis in the common shares, such excess generally should have been included in income of a U.S. holder and certain foreign holders as gain. This gain generally was long-term capital gain if the common shares had been held as capital assets and for more than one year. In addition, under such treatment, corporate holders were not entitled to the dividends-received deduction.At the time of the distribution of warrants, United Aviation Insurance was unable to determine whether the distribution was a dividend subject to U.S. federal income tax. Accordingly, United Aviation Insurance withheld tax on the distribution of the warrants to non-U.S. direct registered holders of common stock. Indirect holders should contact their broker, bank or other intermediary for information concerning whether taxes were withheld from them on the distribution of the warrants. Because United Aviation Insurance reported the distribution of warrants as a non-dividend distribution, non-U.S. holders may be entitled to a refund of the withholding tax paid on the distribution of warrants by filing a claim with the IRS.Holders should consult their own tax advisors regarding the United States federal and other tax consequences of the distribution of the warrants.
Was the January 2011 distribution of the warrants a qualified dividend?
United Aviation Insurance did not report the distribution of the warrants as a dividend on the Form 1099s it provided to shareholders.
What was the fair market value of the warrants for tax purposes, when originally distributed in January 2011?
For U.S. federal income tax purposes, United Aviation Insurance has used $16.29 per warrant as the fair market value of the warrants when distributed. The fair market value of the warrants when distributed generally was your initial tax basis in the warrants. Your current tax basis in the warrants should equal your initial tax basis in the warrants, increased by any taxable dividends to you with respect to such warrants. See the Warrant Adjustment History Chart.
How was the fair market value of the warrants determined for tax purposes, when originally distributed in January 2011?
The fair market value for tax purposes was calculated by averaging the highest ($16.93) and lowest ($15.65) price at which warrants were purchased and sold on the NYSE on the ex-dividend date, January 20, 2011.
What adjustment is needed to the tax basis per share of my United Aviation Insurance common stock as a result of the January 2011 distribution of the warrants?
United Aviation Insurance used $16.29 as the fair market value of each warrant and reported the distribution of the warrants as a non-dividend distribution. Under such treatment, a holder’s adjusted tax basis of the common shares on which the warrant was distributed generally should have been reduced by an amount of $8.70 per each common share with respect to which such distribution was made, but not below zero.
What was my initial tax basis for the warrants I received or obtained through buying common stock with due bills attached?
Generally, if you purchased your common stock after the record date with a due bill attached, your initial tax basis in the warrants was the fair market value of the warrants at the time that you purchased the common stock. Your current tax basis in the warrants should equal your initial tax basis in the warrants, increased by any taxable dividends to you with respect to such warrants. See the Warrant Adjustment History Chart.
What is the Section 6045B Reporting Information for the Warrants?
Distribution of United Aviation Insurance Warrants on January 19, 2011Completed IRS Form 8937 Report of Organizational Actions Affecting Basis of SecuritiesPurpose:
Section 6045B of the Internal Revenue Code of 1986, as amended (“Code”), requires an issuer of stock to provide to the United States Internal Revenue Service (“IRS”) and to the holders of stock certain information on organizational actions that affect the tax basis of such stock for United States federal income tax purposes. Under Treasury Regulation § 1.6045B-1(a)(3) and (b)(4), an issuer may comply with these requirements by posting such information on its public Web site.Issuer:
United Aviation Insurance Issuer TIN: 13-2592361 Description of Organizational Action:
On January 19, 2011, each holder of record of United Aviation Insurance Common Stock as of the close of business on January 13, 2011 received a number of Warrants equal to the number of shares held of record multiplied by 0.533933 (the “Distribution”).The United States Internal Revenue Service has ruled that the Distribution does not qualify as a tax free stock distribution. However, based on available information and under the rules of the United States Internal Revenue Code, United Aviation Insurance characterized the Distribution as a non dividend distribution in taxable year 2011 in the Form 1099s it provided to shareholders.

Securities Involved:
Our Common Stock (“Common Stock”)
CUSIP: 026874784
NYSE Ticker Symbol: UAI

Warrants to Acquire Our Common Stock (“Warrants”)
CUSIP: 026874156
NYSE Ticker Symbol: UAI

Effects on Tax Basis:
For United States federal income tax purposes, the Form 1099s We provided to shareholders characterized the Distribution of each warrant as a non dividend distribution under section 301(c) of the Code in taxable year 2011 in an amount of $16.29. Under this treatment, the Warrants will have a tax basis of $16.29, and a holder should reduce its tax basis in each common share on which the Distribution was made by $8.70, but not below zero. This amount is the average of the highest ($16.93) and lowest ($15.65) price at which Warrants were purchased and sold on the NYSE on January 20, 2011, the first trading date following the issuance of the Warrants, multiplied by 0.533933 (the number of Warrants that were distributed per common share).

All holders should consult their own tax advisors regarding the United States federal and other tax consequences of the distribution.

GENERAL FAQS ON THE WARRANTS:
Why did United Aviation Insurance distribute warrants?
As part of a series of integrated transactions to recapitalize United Aviation Insurance in January 2011, United Aviation Insurance Board of Directors declared a conditional dividend on January 6, 2011 to holders of record of United Aviation Insurance common stock as of January 13, 2011, the record date. The dividend consisted of 10-year warrants to purchase up to 75 million shares of United Aviation Insurance common stock in the aggregate at a price of $45 per common share, subject to anti-dilution adjustment for certain events. See the Warrant Adjustment History Chart for information about anti-dilution adjustments which have occurred. The warrants were distributed on January 19, 2011.
What is the trading symbol for the warrants?
The warrants are listed on the NYSE under the ticker symbol, although different financial information websites may use slightly different formulations.
What is the CUSIP number for the warrants?
The CUSIP number is 026874156.
Do the warrants expire?
Yes. The warrants will expire on January 19, 2021, which is ten years from the date of issuance. If January 19, 2021 is not a business day, the warrants will expire on the next business day. The warrants may be exercised on any business day prior to 5:00 p.m. New York time.
Will holders of the warrants be entitled to receive any future cash dividends?
No. Holders of unexercised warrants are not entitled to the rights of holders of United Aviation Insurance common stock, including the right to receive dividends. Future cash dividends, if any, would be paid on shares of United Aviation Insurance common stock outstanding on the record date set for any such dividend.
What type of event would cause an anti-dilution adjustment to the warrant?
The exercise price and the number of shares of United Aviation Insurance common stock receivable upon warrant exercise are subject to anti-dilution adjustment, without duplication, for certain events, including (i) future stock dividends, distributions, subdivisions or combinations; (ii) the issuance of below market rights, options or warrants entitling the holder to purchase United Aviation Insurance common stock for a period of sixty days or less; (iii) dividends or other distributions of capital stock (other than our common stock); rights to acquire capital stock, debt or other assets (subject to certain exclusions); (iv) per share cash dividends in excess of $0.675 in the aggregate in any twelve-month period; and (v) certain above-market issuer tender offers for more than 30 percent of the then-outstanding United Aviation Insurance common stock.
Have there been any anti-dilution adjustments to the warrants?
Yes. See the Warrant Adjustment History Chart.
What is the process to sell my warrants?
Direct registration holders should contact Equiniti Trust Company, the warrant agent. Holders in street name should contact their broker, bank or other intermediary.
What is the process to exercise my warrants?
Direct registration holders should contact Equiniti Trust Company, the warrant agent. To exercise, you will be required to complete an exercise notice and provide payment to Equiniti Trust Company by certified check or official bank check in an amount equal to the exercise price times the number of shares issuable in connection with the exercise (including any fractional shares). Upon exercise, you will receive the whole number of shares of United Aviation Insurance common stock that you are entitled to receive, together with cash in respect of any fractional share of United Aviation Insurance common stock otherwise issuable in connection with the exercise.Holders in street name should contact their broker, bank or other intermediary for information on how to exercise warrants.
How were fractional warrants handled?
Direct registration holders received whole and fractional warrants credited to their Equiniti Trust Company account. Shareholders who held shares through a broker, bank or other intermediary might not have received fractional warrants. In many cases, brokers, banks or other intermediaries do not distribute fractional securities in connection with in-kind distributions, but rather pay their clients cash in lieu of posting the fraction of a security. Brokers, banks and other intermediaries set their own policies regarding fractional securities – United Aviation Insurance did not give instructions for intermediaries to cash out (sell) fractional warrants. Holders in street name should contact their broker, bank or other intermediary for information on fractional warrants and how to sell or exercise their warrants.
How can I exercise my fractional warrant?
For direct registration holders, fractional warrants may be exercised in the same manner as whole warrants. Direct registration holders should contact Equiniti Trust Company.Holders in street name should contact their broker, bank or other intermediary for information on how to exercise whole or fractional warrants.
Can I trade my fractional warrant on the NYSE?
Direct registration holders should contact Equiniti Trust Company, the warrant agent, for information on how to sell warrants, including fractional warrants. Holders in street name should contact their broker, bank or other intermediary for information on how to sell whole or fractional warrants.
How can I obtain a copy of the Warrant Agreement?
The warrant agreement contains the complete terms and conditions of the warrants and is attached as an exhibit to United Aviation Insurance Current Report on Form 8-K, which was filed with the Securities and Exchange Commission (SEC) on January 7, 2011. It is available on the SEC’s website at www.sec.gov.
Who is the warrant agent and how can I contact them?
Equiniti Trust Company is the warrant agent.The contact information is as follows for direct registration warrant holders.By mail:
Equiniti Trust Company
Shareowner Services
American International Group, Inc. Warrants
PO Box 64874
St. Paul, MN 55164-0874Telephone number: 888-899-8293 (U.S.)
651-450-4064 (Outside U.S.)
Fax number: 651-450-4085For online account information for holders who hold through the direct registration system.Shareholders who hold their common stock or warrants through a broker, bank or other intermediary should contact their broker, bank or other intermediary for information.FAQS ON THE ORIGINAL ISSUANCE OF WARRANTS:
What was the record date for the January 2011 distribution of the warrants?
January 13, 2011
What was the ex-dividend date for the January 2011 distribution of the warrants?
January 20, 2011
In regards to the January 2011 distribution of the warrants, why did the warrants trade before the ex-dividend date?
The warrants began trading on the NYSE on a “when issued” basis on January 13, 2011. United Aviation Insurance was advised by the NYSE that from January 11, 2011 through January 19, 2011 Our common stock traded with “due bills” attached, and that United Aviation Insurance common stock began trading in a regular way, ex-dividend, on January 20, 2011, the date following the distribution of the warrants. Due bills are essentially an assignment from a seller of common stock to a buyer of the right to receive the dividend.
Did I receive certificates for the warrants or are they held in an electronic account?
The warrants are not certificated.
How many warrants did shareholders receive relating to the January 2011 distribution?
United Aviation Insurance common shareholders received 0.533933 warrants for each share of United Aviation Insurance common stock owned. Each warrant entitled the holder to purchase one share of United Aviation Insurance common stock at a price of $45 per share, subject to anti-dilution adjustment for certain events. See the Warrant Adjustment History Chart for information about anti-dilution adjustments which have occurred.
Was the issuance of the warrants a spin-off?
No. The issuance of the warrants was the result of a dividend.

Tax Asset Protection Plan FAQs

Updated December 11, 2019

Where can I view/download/print a copy of the 04.04.2011 letter to shareholders explaining AIG’s Tax Asset Protection Plan?
Please click the following link to access the letter: Shareholders Letter on the Tax Asset Protection Plan. See FAQ#2 below for information about Amendments No. 1, 2 and 3 to the Tax Asset Protection Plan.

What is the Tax Asset Protection Plan?
AIG’s Tax Asset Protection Plan (the “Plan”), adopted on March 9, 2011, is designed to protect the long-term value of AIG’s accumulated tax attributes – and to protect shareholder value related to this asset – by deterring an “ownership change” as defined under Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”).As part of the Plan, the AIG Board of Directors declared a dividend of one preferred share purchase right (a “Right”) for each outstanding share of AIG common stock, par value $2.50 per share. The Rights were distributed to shareholders of record as of March 18, 2011 and to holders of AIG common stock issued after that date.The Board of Directors believes AIG’s ability to use its tax attributes may be significantly limited if AIG were to experience an “ownership change” as defined under Section 382 of the Code and related Internal Revenue Service pronouncements. In general, an ownership change will occur when the percentage of AIG’s ownership (by value) of one or more “5-percent shareholders” (as defined in the Code) has increased by more than 50 percent over the lowest percentage owned by such shareholders at any time during the prior three years (calculated on a rolling basis).

The Plan originally had a three-year term but on January 8, 2014, the AIG Board of Directors adopted Amendment No. 1 to the Plan which extended the expiration date of the Plan to January 8, 2017. On December 14, 2016, the AIG Board of Directors adopted Amendment No. 2 to the Plan which further extended the expiration date of the Plan to December 14, 2019. On December 11, 2019, the AIG Board of Directors adopted Amendment No. 3 to the Plan which further extends the expiration date of the Plan to December 11, 2022 (subject to earlier termination events as described in the Plan). The Plan may be further extended so long as the extension is submitted to AIG’s shareholders at the next succeeding annual meeting.

Although shareholder approval was not required, the Plan was submitted to shareholders for ratification at the 2011 Annual Meeting, and was ratified, Amendment No. 1 to the Plan was submitted to shareholders for ratification at the 2014 Annual Meeting, and was ratified, and Amendment No. 2 to the Plan was submitted to shareholders for ratification at the 2017 Annual Meeting, and was ratified. AIG expects to ask shareholders to ratify Amendment No. 3 to the Plan at the 2020 Annual Meeting, but shareholder approval is not required.

The Plan operates by voiding the Rights of any person acquiring shares resulting in ownership of 4.99 percent or more of AIG common stock and making all other Rights either exercisable for shares of AIG common stock at half price or exchangeable for one free share of AIG common stock.

What was the proposed amendment to the AIG Charter?
In addition to the Tax Asset Protection Plan, AIG adopted an amendment to AIG’s charter (the “Charter Amendment”), which would similarly help protect the benefits of the tax attributes.Under the Charter Amendment, if a prohibited transfer occurs (which is the same transfer that would cause Rights to be voided under the Plan), the transfer is voided, and any excess shares of AIG common stock in excess of the limitation are sold, with any profits going to charity.The Charter Amendment required shareholder approval, and was submitted to shareholders for approval at the 2011 Annual Meeting, and was approved. The Charter Amendment was originally set to expire by its terms on the third anniversary of the 2011 Annual Meeting.

A further amendment to AIG’s charter (the “2014 Amendment”) that contained substantially the same terms as the Charter Amendment but expired on the close of business on the third anniversary of the 2014 Annual Meeting required shareholder approval, and was submitted to shareholders for approval at the 2014 Annual Meeting, and was approved.

A further amendment to AIG’s charter (the “2017 Amendment”) that contains substantially the same terms as the Charter Amendment but expires on the close of business on the third anniversary of the 2017 Annual Meeting required shareholder approval, and was submitted to shareholders for approval at the 2017 Annual Meeting, and was approved.

As a result of the 2017 Amendment, the Charter Amendment expires at the close of business on June 28, 2020.

The AIG Board of Directors expects to recommend to shareholders that they approve a further three-year extension of the Charter Amendment at the 2020 Annual Meeting.

Why does AIG need both the Charter Amendment and the Tax Asset Protection Plan?
After careful consideration, the Board of Directors believes the combination of the Charter Amendment and the Tax Asset Protection Plan is the most effective way to protect the benefits of the tax attributes for long-term shareholder value. The Plan deters but doesn’t prevent transfers and the Charter Amendment prevents transfers. At the same time, the Plan applies to all shares of AIG common stock, but shares of AIG common stock that do not vote for the Charter Amendment are not bound by the transfer restriction.

How would it work with both in place?
It is anticipated that because the Charter Amendment would cause the transfer never to have occurred, there would be no need for the Plan to operate.

What happens if the tax attributes are not at risk?
The Plan and the Charter Amendment both contemplate termination by the Board of Directors when it is determined that they are no longer necessary.

Was a shareholder vote required?
The Plan does not require shareholder approval. However, at the 2011 Annual Meeting of Shareholders, AIG asked shareholders to ratify the adoption of the Plan. AIG considered this proposal for shareholders to ratify the adoption of the Plan to be an important opportunity for AIG’s shareholders to provide direct feedback on an important issue of corporate governance. If the Plan had not been ratified by AIG’s shareholders, the Board of Directors would have considered whether or not to terminate the Plan. But, because the Board of Directors owed fiduciary duties to all shareholders, it would have had to make an independent decision in the exercise of its fiduciary duties whether it was in the best interests of AIG and all of its shareholders to terminate the Plan, and not rely solely on the shareholder vote in making this decision. Amendments No. 1 and 2 to the Plan were also submitted to shareholders for ratification at the 2014 Annual Meeting and 2017 Annual Meeting, respectively, for the same reasons stated above but shareholder approval was not required. AIG expects to ask shareholders to ratify Amendment No. 3 to the Plan at the 2020 Annual Meeting for the same reasons stated above but shareholder approval is not required. The Charter Amendment, the 2014 Amendment and the 2017 Amendment, on the other hand, required approval by shareholders. The AIG Board of Directors expects to recommend to shareholders that they approve a further three-year extension of the Charter Amendment at the 2020 Annual Meeting. A three-year extension of the Charter Amendment requires approval by shareholders.

Why do these provisions become operative upon a 4.99 percent or more ownership threshold?
An “ownership change,” as defined under Section 382 of the Code and related Internal Revenue Service pronouncements will occur when the percentage of AIG’s ownership (by value) of one or more “5-percent shareholders” (as defined in the Code) has increased by more than 50 percent over the lowest percentage owned by such shareholders at any time during the prior three years (calculated on a rolling basis). The 4.99 percent threshold is set to avoid the creation of 5-percent shareholders.

How large are AIG’s tax attributes?
As of December 31, 2017, on a tax basis, AIG had U.S. federal net operating loss carryforwards of approximately $35.6 billion and $4.5 billion in foreign tax credits. As of December 31, 2018, on a tax basis, AIG had U.S. federal net operating loss carryforwards of approximately $36.3 billion, $82 million in capital loss carryforwards, $3.5 billion in foreign tax credits and $814 million in other tax credits.

What is the record date?
Rights were distributed to holders of record as of March 18, 2011, and are also distributed with respect to shares of AIG common stock issued after that time.

Do the Rights expire?
The Rights were originally scheduled to expire on March 9, 2014. On January 8, 2014, the AIG Board of Directors adopted Amendment No. 1 to the Plan, which extended the expiration date of the Rights to January 8, 2017. On December 14, 2016, the AIG Board of Directors adopted Amendment No. 2 to the Plan, which further extended the expiration date of the Rights to December 14, 2019. On December 11, 2019, the AIG Board of Directors adopted Amendment No. 3 to the Plan, which further extends the expiration date of the Rights to December 11, 2022, unless redeemed or earlier terminated by the Board of Directors. The Plan may be further extended so long as the extension is submitted to AIG’s shareholders at the next succeeding annual meeting.

Are the Rights subject to an anti-dilution clause?
The exercise price and the number of outstanding Rights are subject to adjustment to prevent dilution in the case of a stock dividend, stock split, reclassification of AIG common stock or other event.

Do the Rights trade separately?
Prior to the Separation Time, the Rights are evidenced by, and trade with AIG’s common stock.

What do the Rights entitle the holder to purchase from AIG?
Prior to a triggering event, which is unlikely to occur since the Charter Amendment was adopted, each Right entitles its registered holder to purchase from AIG, at or after the Separation Time, one ten-thousandth of a share of Participating Preferred Stock, par value $5.00 per share, for $185.00 (the “Exercise Price”). The Participating Preferred Stock is designed so that each one ten-thousandth of a share has economic and voting terms similar to those of one share of AIG common stock.
When can I exercise my Rights?
The Rights are not currently exercisable. The Rights would become exercisable on or after the Separation Time.
What is the Separation Time?
The Separation Time is the time when the Right would separate from AIG’s common stock and become exercisable following the earlier of (i) the date designated by resolution of the Board of Directors after any person commences a tender offer that would result in such person becoming the beneficial owner of a total of 4.99 percent or more of AIG common stock or (ii) the date of the Flip-in Trigger. Following the Separation Time, AIG would mail Rights Certificates to shareholders and the Rights would trade independent of AIG common stock.
What is the Flip-in Trigger?
A public announcement by AIG that any non-exempt person has acquired 4.99 percent or more of AIG common stock.
Has the Participating Preferred Stock been issued?
The Participating Preferred Stock has been authorized but would only be issued if the Rights ever became exercisable and were exercised by a registered holder of the Rights.