How do aig warrants work

Why do these provisions become operative upon a 4. The 4. As of December 31, , on a U. What is the record date? Rights were distributed to holders of record as of March 18, , 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, 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? What do the Rights entitle the holder to purchase from AIG? 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? What is the Flip-in Trigger?

A public announcement by AIG that any non-exempt person has acquired 4. 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.

Frequently Asked Questions. News and Governance. Visit AIG News. You must use a licensed broker to buy or sell shares of AIG common stock. Does AIG have a direct purchase plan for common stock or a dividend reinvestment plan? AIG does not have a direct purchase plan nor does it have a dividend reinvestment plan. If you own AIG common stock through a brokerage account please contact your broker. Where can I find historical common stock price information?

Go to the Historical Stock Price section and enter the applicable date. How do I replace a lost or uncashed dividend check? I need to know how to calculate my cost basis for my shares of AIG common stock? Warrant FAQs The warrants expired at p. Are there any substantial tax implications related to the January distribution of the warrants? 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, AIG was unable to determine whether the distribution was a dividend subject to U.

Accordingly, AIG withheld tax on the distribution of the warrants to non-U. 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 AIG reported the distribution of warrants as a non-dividend distribution, non-U. 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 distribution of the warrants a qualified dividend? AIG did not report the distribution of the warrants as a dividend on the Form s it provided to shareholders. What was the fair market value of the warrants for tax purposes, when originally distributed in January ? For U. 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 ?

What adjustment is needed to the tax basis per share of my AIG common stock as a result of the January distribution of the warrants? 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.

Issuer: American International Group, Inc. 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, AIG characterized the Distribution as a nondividend distribution in taxable year in the Form s it provided to shareholders. All holders should consult their own tax advisors regarding the United States federal and other tax consequences of the distribution.

See the Warrant Adjustment History Chart for information about anti-dilution adjustments which have occurred. The warrants were distributed on January 19, What was the trading symbol for the warrants? The NYSE suspended trading in the warrants after the close of trading on January 13, so that trades could be settled by January 19, , when the warrants expired.

When did the warrants expire? What type of event would have caused an anti-dilution adjustment to the warrant? Were there any anti-dilution adjustments to the warrants? Can I still sell my warrants? New York time on January 19, , expired and became void. What was the process to exercise my warrants? When a warrant is exercised the company issues new shares, increasing the total number of shares outstanding.

The warrant could be based on any ratio chosen by the company. It may require five warrants for one share, or 10, or When selling or exercising an option, make sure you are aware of all the stipulations of the warrant so you end with the number of shares and exercise the number of warrants you want.

Another alternative a warrant holder has is to sell the warrants. Warrants can be bought and sold up until expiry. This is because there is also time value added to the cost of the warrant. Even if the current stock price is below the strike price, the warrant may still have some time value and can, therefore, be sold for something.

If the trader opts to sell the option instead of exercising it, sell the warrant within your trading account how you would any other stock or option.

Set the price to sell it at, the quantity, along with any other order parameters you want. Advanced Options Trading Concepts. Actively scan device characteristics for identification.

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Personal Finance. Your Practice. Popular Courses. Table of Contents Expand. How to Sell or Exercise a Warrant. Use Your Broker. Special Considerations. The Bottom Line. Key Takeaways A stock warrant is issued by an employer that gives the holder the right to buy company shares at a certain price before the expiration.

When a warrant is exercised, the company issues new shares, increasing the total number of shares outstanding, which has a dilutive effect. Warrants can be bought and sold on the secondary market up until expiry.

If the current stock price is below the strike price, the warrant may still have some time value and can still have value in the market.