Ambac Announces Information about Congressional Joint Committee Review

  Ambac Announces Information about Congressional Joint Committee Review

Business Wire

NEW YORK -- December 28, 2012

Ambac Financial Group, Inc. (“Ambac”) has been informed that the Congressional
Joint Committee on Taxation (the “Joint Committee”) has completed its review
of the offer (the “Offer”) made by Ambac, the Official Committee of Unsecured
Creditors of Ambac, Ambac Assurance Corporation (“Ambac Assurance”), the
Segregated Account of Ambac Assurance Corporation (the “Segregated Account”),
the court-appointed Rehabilitator of the Segregated Account and the Wisconsin
Office of the Commissioner of Insurance to the United States to resolve and
settle (i) the claims filed by the Internal Revenue Service of the Department
of Treasury of the United States against Ambac’s estate in its Chapter 11
proceeding, (ii) Ambac’s related adversary proceeding against the United
States, and (iii) other related litigation brought by the United States
against or involving Ambac Assurance and/or the Segregated Account (the “IRS
Settlement”). Ambac has also been informed that the Joint Committee has no
objection to the Offer and will issue a response of “no adverse criticism”
subject to the satisfaction of certain conditions, including (a) execution of
closing documentation acceptable to the United States, Ambac and the other
parties to the IRS Settlement, (b) approval of the IRS Settlement by the
United States Bankruptcy Court for the Southern District of New York that is
overseeing Ambac’s Chapter 11 proceeding and (c) the payment by Ambac of $1.9
million and the payment by Ambac Assurance and/or the Segregated Account of
$100 million to the United States. The satisfaction of such conditions and the
receipt of a “no adverse criticism” response from the Joint Committee with
respect to the Offer would, in turn, satisfy certain outstanding conditions
precedent to the effectiveness of Ambac’s Fifth Amended Plan of

About Ambac

On November 8, 2010, Ambac Financial Group, Inc. (“Ambac”) filed for a
voluntary 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
however, Ambac is not currently able to estimate when it will be able to
consummate such reorganization. Until the plan of reorganization is
consummated and Ambac emerges from bankruptcy, it 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. Currently, Ambac’s common stock trades in the
over-the-counter market under ticker symbol ABKFQ. 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.

Ambac’s principal operating subsidiary, Ambac Assurance Corporation, is a
guarantor of public finance and structured finance obligations.


Michael Fitzgerald, 212-208-3222
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