UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D/A
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 22)
21ST CENTURY INSURANCE GROUP
(NAME OF ISSUER)
COMMON STOCK, $0.001 PAR VALUE PER SHARE
(TITLE OF CLASS OF SECURITIES)
90130N 10 3
(CUSIP NUMBER)
KATHLEEN E. SHANNON
SENIOR VICE PRESIDENT AND SECRETARY
AMERICAN INTERNATIONAL GROUP, INC.
70 PINE STREET
NEW YORK, NEW YORK
(212) 770-7000
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES AND
COMMUNICATIONS)
JANUARY 24, 2007
(DATE OF EVENT WHICH REQUIRES FILING OF THIS STATEMENT)
IF THE FILING PERSON HAS PREVIOUSLY FILED A STATEMENT ON SCHEDULE 13G TO REPORT
THE ACQUISITION WHICH IS THE SUBJECT OF THIS SCHEDULE 13D, AND IS FILING THIS
SCHEDULE BECAUSE OF RULE 13D-1(b)(3) OR (4), CHECK THE FOLLOWING BOX:
[ ]
(CONTINUED ON THE FOLLOWING PAGE)
- ---------------------
CUSIP NO. 90130N 10 3
- ---------------------
- --------------------------------------------------------------------------------
(1) Name of Reporting Person/S.S. or I.R.S.
Identification No. of Above Person
American International Group, Inc. (I.R.S. Identification No. 13-2592361)
- --------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group
(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
(3) SEC Use Only
- --------------------------------------------------------------------------------
(4) Source of Funds
WC
- --------------------------------------------------------------------------------
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d)
or 2(e)
[X]
- --------------------------------------------------------------------------------
(6) Citizenship or Place of Organization Incorporated in the State of Delaware
- --------------------------------------------------------------------------------
(7) Sole Voting Power
0
-----------------------------------------------------------
(8) Shared Voting Power
Number of Shares
Beneficially Owned 53,472,816
By Each Reporting -----------------------------------------------------------
Person With (9) Sole Dispositive Power
0
-----------------------------------------------------------
(10) Shared Dispositive Power
53,472,816
- --------------------------------------------------------------------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
53,472,816
- --------------------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
[ ]
- --------------------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
61.9%
- --------------------------------------------------------------------------------
(14) Type of Reporting Person
HC, CO
- --------------------------------------------------------------------------------
2
- ---------------------
CUSIP NO. 90130N 10 3
- ---------------------
- --------------------------------------------------------------------------------
(1) Name of Reporting Person/S.S. or I.R.S.
Identification No. of Above Person
American Home Assurance Company (I.R.S. Identification No. 13-5124990)
- --------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group
(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
(3) SEC Use Only
- --------------------------------------------------------------------------------
(4) Source of Funds
OO
- --------------------------------------------------------------------------------
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d)
or 2(e)
[ ]
- --------------------------------------------------------------------------------
(6) Citizenship or Place of Organization Incorporated in the State of New York
- --------------------------------------------------------------------------------
(7) Sole Voting Power
0
-----------------------------------------------------------
(8) Shared Voting Power
Number of Shares
Beneficially Owned 14,395,665
By Each Reporting -----------------------------------------------------------
Person With (9) Sole Dispositive Power
0
-----------------------------------------------------------
(10) Shared Dispositive Power
14,395,665
- --------------------------------------------------------------------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
14,395,665
- --------------------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
[ ]
- --------------------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
16.7%
- --------------------------------------------------------------------------------
(14) Type of Reporting Person
IC, CO
- --------------------------------------------------------------------------------
3
- ---------------------
CUSIP NO. 90130N 10 3
- ---------------------
- --------------------------------------------------------------------------------
(1) Name of Reporting Person/S.S. or I.R.S.
Identification No. of Above Person
Commerce and Industry Insurance Company (I.R.S. Identification No.
31-1938623)
- --------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group
(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
(3) SEC Use Only
- --------------------------------------------------------------------------------
(4) Source of Funds
OO
- --------------------------------------------------------------------------------
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d)
or 2(e)
[ ]
- --------------------------------------------------------------------------------
(6) Citizenship or Place of Organization Incorporated in the State of New York
- --------------------------------------------------------------------------------
(7) Sole Voting Power
0
-----------------------------------------------------------
(8) Shared Voting Power
Number of Shares
Beneficially Owned 5,414,827
By Each Reporting -----------------------------------------------------------
Person With (9) Sole Dispositive Power
0
-----------------------------------------------------------
(10) Shared Dispositive Power
5,414,827
- --------------------------------------------------------------------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
5,414,827
- --------------------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
[ ]
- --------------------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
6.3%
- --------------------------------------------------------------------------------
(14) Type of Reporting Person
IC, CO
- --------------------------------------------------------------------------------
4
- ---------------------
CUSIP NO. 90130N 10 3
- ---------------------
- --------------------------------------------------------------------------------
(1) Name of Reporting Person/S.S. or I.R.S.
Identification No. of Above Person
New Hampshire Insurance Company (I.R.S. Identification No. 02-0172170)
- --------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group
(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
(3) SEC Use Only
- --------------------------------------------------------------------------------
(4) Source of Funds
OO
- --------------------------------------------------------------------------------
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d)
or 2(e)
[ ]
- --------------------------------------------------------------------------------
(6) Citizenship or Place of Organization Incorporated in the State of
Pennsylvania
- --------------------------------------------------------------------------------
(7) Sole Voting Power
0
-----------------------------------------------------------
(8) Shared Voting Power
Number of Shares
Beneficially Owned 5,414,827
By Each Reporting -----------------------------------------------------------
Person With (9) Sole Dispositive Power
0
-----------------------------------------------------------
(10) Shared Dispositive Power
5,414,827
- --------------------------------------------------------------------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
5,414,827
- --------------------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
[ ]
- --------------------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
6.3%
- --------------------------------------------------------------------------------
(14) Type of Reporting Person
IC, CO
- --------------------------------------------------------------------------------
5
- ---------------------
CUSIP NO. 90130N 10 3
- ---------------------
- --------------------------------------------------------------------------------
(1) Name of Reporting Person/S.S. or I.R.S.
Identification No. of Above Person
National Union Fire Insurance Company of Pittsburgh, Pa. (I.R.S.
Identification No. 25-0687550)
- --------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group
(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
(3) SEC Use Only
- --------------------------------------------------------------------------------
(4) Source of Funds
OO
- --------------------------------------------------------------------------------
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d)
or 2(e)
[ ]
- --------------------------------------------------------------------------------
(6) Citizenship or Place of Organization Incorporated in the State of
Pennsylvania
- --------------------------------------------------------------------------------
(7) Sole Voting Power
0
-----------------------------------------------------------
(8) Shared Voting Power
Number of Shares
Beneficially Owned 28,220,301
By Each Reporting -----------------------------------------------------------
Person With (9) Sole Dispositive Power
0
-----------------------------------------------------------
(10) Shared Dispositive Power
28,220,301
- --------------------------------------------------------------------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
28,220,301
- --------------------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
[ ]
- --------------------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
32.7%
- --------------------------------------------------------------------------------
(14) Type of Reporting Person
IC, CO
- --------------------------------------------------------------------------------
6
Item 1. Security and Issuer.
This Amendment No. 22 (this "Amendment") to the Statement on Schedule 13D
filed by American International Group, Inc., a Delaware corporation ("AIG"),
amends and supplements the Statement on Schedule 13D originally filed by AIG on
December 16, 1994 and as amended by Amendment No. 1 to Schedule 13D dated March
23, 1995, Amendment No. 2 to Schedule 13D dated January 20, 1998, Amendment No.
3 to Schedule 13D dated April 9, 1998, Amendment No. 4 to Schedule 13D dated May
12, 1998, Amendment No. 5 to Schedule 13D dated June 4, 1998, Amendment No. 6 to
Schedule 13D dated June 15, 1998, Amendment No. 7 to Schedule 13D dated June 25,
1998, Amendment No. 8 to Schedule 13D July 14, 1998, Amendment No. 9 to Schedule
13D dated July 23, 1998, Amendment No. 10 to Schedule 13D dated July 27, 1998,
Amendment No. 11 to Schedule 13D dated August 10, 1998, Amendment No. 12 to
Schedule 13D dated August 19, 1998, Amendment No. 13 to Schedule 13D dated
August 24, 1998, Amendment No. 14 to Schedule 13D dated September 3, 1998,
Amendment No. 15 to Schedule 13D dated September 11, 1998, Amendment No. 16 to
Schedule 13D filed on November 10, 1998, Amendment No. 17 to Schedule 13D filed
on December 16, 1998, Amendment No. 18 to Schedule 13D filed on February 5,
1999, Amendment No. 19 to Schedule 13D filed on April 1, 1999, Amendment No. 20
to Schedule 13D filed on May 3, 1999, and Amendment No. 21 to Schedule 13D filed
on April 7, 2000, relating to the common stock, par value $0.001 per share
("Common Stock"), of 21st Century Insurance Group, a Delaware corporation (the
"Company"). The principal executive offices of the Company are located at 6301
Owensmouth Avenue, Woodland Hills, California 91367.
Item 2. Identity and Background.
General
(a) through (c) and (f): This Amendment to Schedule 13D is being filed by
AIG on behalf of itself and its wholly owned subsidiaries, American Home
Assurance Company, a New York corporation ("American Home"); Commerce and
Industry Insurance Company, a New York corporation ("Commerce & Industry");
National Union Fire Insurance Company of Pittsburgh, Pa., a Pennsylvania
corporation ("National Union"); and New Hampshire Insurance Company, a
Pennsylvania corporation ("New Hampshire" and, together with American Home,
Commerce & Industry and National Union, the "AIG Subs"). The principal executive
offices of AIG, American Home, Commerce & Industry, National Union and New
Hampshire are located at 70 Pine Street, New York, New York 10270. In addition,
the 53,472,816 outstanding shares of Common Stock owned by AIG include 27,196
outstanding shares of Common Stock held by certain investment advisor
subsidiaries of AIG on behalf of their clients. AIG is a holding company which,
through its subsidiaries (including the AIG Subs), is primarily engaged in a
broad range of insurance and insurance-related activities in the United States
and abroad. AIG's primary activities include both general and life insurance and
retirement services operations. Other significant activities include financial
services and asset management.
Starr International Company, Inc., a Panamanian corporation ("SICO"), has
the sole power to vote and direct the disposition of 291,436,280 shares of
common stock, par value $2.50 per share, of AIG ("AIG Shares") and the shared
power to direct the disposition of 2,202,603 AIG Shares held by Universal
Foundation, Inc., a Panamanian corporation ("Universal Foundation"). C.V. Starr
& Co., Inc., a Delaware corporation ("Starr"), has the shared power to vote and
direct the disposition of 31,349,476 AIG Shares (18,644,278 of which are held by
the C.V. Starr & Co., Inc. Trust ("Starr Trust"), of which Starr is a
beneficiary). Maurice R. Greenberg, a United States citizen, has the sole power
to vote and direct the disposition of 2,695,797 AIG Shares, which may be
acquired pursuant to stock options previously granted by AIG to Mr. Greenberg as
a then officer and director of AIG. Mr. Greenberg has shared power to vote and
direct the disposition of 68,950,119 AIG Shares, 17,619,506 of which are held as
a tenant in common with Mr. Greenberg's wife, 109,630 of which are held in
family trusts of which Mr. Greenberg is a trustee, 31,349,476 of which are held
by Starr (18,644,278 shares of which are held by the Starr Trust, for which
Starr is a beneficiary and Mr. Greenberg is a trustee), 371,507 of which are
held by the Maurice R. and Corinne P. Greenberg Family Foundation, Inc., a New
York not-for-profit corporation (the "Greenberg Foundation"), of which Mr.
Greenberg, his wife and family members are directors and 19,500,000 of which are
held by the Maurice R. and Corinne P. Greenberg Joint Tenancy Company, LLC, a
Florida limited liability company (the "Greenberg Joint Tenancy Company"), of
which the Maurice R. and Corinne P. Greenberg Joint Tenancy Corporation, Inc.
(the "Greenberg Joint Tenancy Corporation") is the sole and managing member. Mr.
Greenberg owns 24.08% of the voting common stock of Starr directly. The
Greenberg Foundation has the shared power to vote and direct the disposition of
such 371,507 AIG Shares. The Greenberg Joint Tenancy Company has the shared
power to vote and direct the disposition of such 19,500,000 AIG Shares. Edward
E. Matthews, a United States citizen, has the sole power to vote and direct the
disposition of 615,945 AIG Shares, 302,820 of which are held directly by Mr.
Matthews and 313,125 of which may be acquired pursuant to stock options
previously granted by AIG to Mr. Matthews as a then officer and director of AIG.
Mr. Matthews has shared power to vote and direct the disposition of 18,667,378
AIG Shares, 23,100
7
of which are held by Mr. Matthews' wife and 18,644,278 of which are held by the
Starr Trust, for which Starr is a beneficiary and Mr. Matthews is a trustee.
The principal executive offices of SICO are located at Fitzwilliam Hall,
Fitzwilliam Place, Dublin 2, Ireland and it also maintains an office at Mercury
House, 101 Front Street, Hamilton HM12, Bermuda. The principal executive offices
of Starr and the Greenberg Foundation are located at 399 Park Avenue, 17th
Floor, New York, New York 10022. The principal executive offices of Universal
Foundation are located at Mercury House, 101 Front Street, Hamilton HM 12,
Bermuda. The principal executive offices of the Greenberg Joint Tenancy Company
are located at 35 Ocean Reef Drive, Key Largo, Florida 33037. The names of the
directors and executive officers ("Covered Persons") of AIG, the AIG Subs, SICO,
Starr, Universal Foundation, the Greenberg Foundation and the Greenberg Joint
Tenancy Corporation, their business addresses and principal occupations,
including the business addresses and principal occupations of Messrs. Greenberg
and Matthews, are set forth in Exhibit A attached hereto, which is incorporated
herein by reference in its entirety. The business address indicated for Messrs.
Greenberg and Matthews and each other Covered Person is also the address of the
principal employer of such person. Each of the Covered Persons is a citizen of
the United States, except for Messrs. Sullivan, Tse and Walsh, who are British
Subjects, Mr. Marshall A. Cohen, who is a Canadian citizen, Dr. Jacob A.
Frenkel, who is a citizen of the State of Israel and the Republic of Poland, Mr.
Osborne, Ms. Barclay, Mr. Johnson and Ms. Barnes, who are citizens of the United
Kingdom and Mr. Zalamea, Ms. Fernando and Mr. Colayco who are citizens of the
Republic of the Philippines.
All information provided in this Amendment (including, without limitation,
in this Item 2 and Exhibit A to this Amendment) with respect to Messrs.
Greenberg and Matthews, SICO, Starr, Universal Foundation, the Greenberg
Foundation, and the Greenberg Joint Tenancy Company and their respective
directors and executive officers is provided based solely on the information set
forth in the most recent amendment to Schedule 13D relating to AIG Shares filed
on November 20, 2006 on behalf of Messrs. Greenberg and Matthews, SICO, Starr,
Universal Foundation, the Greenberg Foundation and the Greenberg Joint Tenancy
Company. This information has not been updated to reflect changes in the
ownership by such parties of AIG Shares that are disclosed in filings made by
one or more of such parties under Section 16 of the Securities Exchange Act of
1934, as amended ("Exchange Act"). In each case, such information may not be
accurate or complete and AIG takes no responsibility therefor and makes no
representation to its accuracy or completeness as of the date hereof or any
subsequent date.
(d) and (e):
2006 Regulatory Settlements
In February 2006, AIG reached a final settlement with the Securities and
Exchange Commission ("SEC"), the United States Department of Justice ("DOJ"),
the Office of the New York Attorney General ("NYAG") and the New York State
Department of Insurance ("DOI"). The settlements resolved outstanding litigation
filed by the SEC, NYAG and DOI against AIG and concluded negotiations with these
authorities and the DOJ in connection with the accounting, financial reporting
and insurance brokerage practices of AIG and its subsidiaries, as well as claims
relating to the underpayment of certain workers compensation premium taxes and
other assessments.
AIG, without admitting or denying the allegations in the SEC complaint,
consented to the issuance of a final judgment on February 9, 2006: (a)
permanently restraining and enjoining AIG from violating Section 17(a) of the
Securities Act of 1933, as amended ("Securities Act"), and Sections 10(b),
13(a), 13(b)(2) and 13(b)(5) and Rules 10b-5, 12b-20, 13a-1, 13a-13 and 13b2-1
of the Exchange Act; (b) ordering AIG to pay disgorgement in the amount of $700
million; and (c) ordering AIG to pay a civil penalty in the amount of $100
million. These amounts have been paid into a fund under the supervision of the
SEC to be available to resolve claims asserted in various civil proceedings,
including shareholder lawsuits.
In February 2006, AIG and the DOJ entered into a letter agreement. In the
letter agreement, the DOJ notified AIG that in its view, AIG, acting through
some of its employees, violated federal criminal law in connection with
misstatements in periodic financial reports that AIG filed with the SEC between
2000 and 2004 relating to certain transactions. The settlement with the DOJ
consists of, among other things, AIG's cooperating with the DOJ in the DOJ's
ongoing criminal investigation, accepting responsibility for certain of its
actions and those of its employees relating to these transactions and paying $25
million.
Effective February 9, 2006, AIG entered into agreements with the NYAG and
the DOI, settling claims under New York's Martin Act and insurance laws, among
other provisions, which were originally brought by the NYAG and the DOI in a
civil complaint filed on May 26, 2005. Under the agreements, $375 million was
paid into a fund under the supervision of the NYAG and the DOI to be available
principally to pay certain AIG insureds who purchased excess casualty policies
through Marsh & McLennan Companies, Inc. or Marsh Inc. In addition,
approximately $343 million will be used to compensate participating state funds
in connection with the
8
underpayment of certain workers compensation premium taxes and other
assessments. In addition, AIG paid $100 million as a fine to the State of New
York.
As part of these settlements, AIG has agreed to retain for a period of
three years an independent consultant who will conduct a review that will
include the adequacy of AIG's internal controls over financial reporting and the
remediation plan that AIG has implemented as a result of its own internal
review.
PNC Settlement
In November 2004, AIG and AIG Financial Products Corp. ("AIGFP"), a
subsidiary of AIG, reached a final settlement with the SEC, the Fraud Section of
the DOJ and the United States Attorney for the Southern District of Indiana with
respect to issues arising from certain structured transactions entered into with
Brightpoint, Inc. and The PNC Financial Services Group, Inc. ("PNC"), the
marketing of transactions similar to the PNC transactions and related matters.
As part of the settlement, the SEC filed against AIG a civil complaint,
based on the conduct of AIG primarily through AIGFP, alleging violations of
certain antifraud provisions of the federal securities laws and for aiding and
abetting violations of reporting and record keeping provisions of those laws.
AIG, without admitting or denying the allegations in the SEC complaint,
consented to the issuance of a final judgment permanently enjoining it and its
employees and related persons from violating certain provisions of the Exchange
Act, Exchange Act rules and the Securities Act, ordering disgorgement of fees it
received from the PNC transactions and providing for AIG to establish a
transaction review committee to review the appropriateness of certain future
transactions and to retain an independent consultant to examine certain
transactions entered into between 2000 and 2004 and review the policies and
procedures of the transaction review committee.
The DOJ filed against AIGFP PAGIC Equity Holding Corp. ("AIGFP PAGIC"), a
wholly-owned subsidiary of AIGFP, a criminal complaint alleging that AIGFP PAGIC
violated federal securities laws by aiding and abetting securities law
violations by PNC, in connection with a transaction entered into in 2001 with
PNC that was intended to enable PNC to remove certain assets from its balance
sheets. The settlement with the DOJ consists of separate agreements with AIG and
AIGFP and a complaint filed against, and deferred prosecution agreement with,
AIGFP PAGIC. Under the terms of the settlement, AIGFP paid a monetary penalty of
$80 million. On January 17, 2006, the court approved an order dismissing the
complaint with prejudice. The obligations of AIG, AIGFP and AIGFP PAGIC under
the DOJ agreements relate principally to cooperating with the DOJ and other
federal agencies in connection with their related investigations.
Item 3. Source and Amount of Funds or Other Consideration.
In connection with the proposed transaction described in Item 4, AIG
estimates that the total amount of funds required to purchase all of the
outstanding Company's Common Stock not currently owned by AIG and the AIG Subs
in the Merger (as defined in Item 4) and to pay estimated fees and expenses will
be approximately $700 million. AIG will use working capital, including cash
and/or proceeds of commercial paper issuances, to finance the consummation of
the Merger and the associated fees and expenses.
Item 4. Purpose of Transaction.
On January 24, 2007, AIG sent a letter to the Company's Board of
Directors stating that it proposes to acquire all of the outstanding Common
Stock of the Company not currently owned by AIG and the AIG Subs (the "Shares")
for $19.75 per Share in cash, and on January 24, 2007, AIG issued a related
press release. Copies of AIG's proposal letter and press release are being filed
herewith as Exhibits B and C, respectively.
AIG also proposes that, subject to negotiation with and approval by a
special committee comprised of directors of the Company who are independent of
AIG, an Agreement and Plan of Merger (the "Acquisition Agreement") would be
entered into by and among the Company, AIG and a wholly-owned subsidiary of AIG.
The subsidiary of AIG would be merged with and into the Company (the "Merger")
in accordance with the terms and conditions of the Acquisition Agreement and
Delaware law, and the Company would then exist as an indirect wholly-owned
subsidiary of AIG. As a result of the Merger, all Shares (except those Shares as
to which appraisal rights are exercised under Delaware law and Shares held by
the AIG Subs) would be converted into the right to receive $19.75 per Share in
cash, without interest (the "Merger Price"). The Merger also would be subject to
conditions, and AIG expressly reserves the right to waive or not waive any
unsatisfied condition in the Merger. AIG believes the Merger is not subject to
California Department of Insurance review or that of any state regulator under
the relevant insurance laws. However, California or one of the other states
9
with jurisdiction over AIG and the Company could assert a right to review the
Merger. AIG is informing the relevant regulators of the proposal, and if they do
assert such a review right, AIG would not complete the Merger before obtaining
any required approval.
The foregoing is a summary of AIG's current proposal and should not be
construed as an offer to purchase Shares. Any offer relating to a merger will be
made by means of a proxy statement if and when there is a definitive Acquisition
Agreement with the Company. Shareholders are urged to read any such proxy
statement and other relevant documents regarding the Merger filed with the SEC
when they become available because they will contain important information.
Shareholders will be able to receive these documents (when they become
available), as well as other documents filed by AIG and the Company with respect
to the Merger, free of charge at the SEC's web site, www.sec.gov or at the
principal office of the Company at 6301 Owensmouth Avenue, Woodland Hills,
California, 91367.
The SEC has adopted Rule 13e-3 under the Securities Exchange Act which is
applicable to certain "going private" transactions. Rule 13e-3 requires among
other things, that certain financial information concerning the Company, and
certain information relating to the fairness of the proposed transaction and the
consideration offered to minority shareholders in such transaction, be filed
with the SEC and disclosed to minority shareholders prior to consummation of the
transaction. AIG expects to file the information required by Rule 13e-3 with the
SEC after the completion of definitive documentation regarding the Merger,
including the Acquisition Agreement, and to provide the required information to
holders of Shares at such time.
If the Merger is successfully completed, the surviving corporation would be
an indirect wholly-owned subsidiary of AIG, and AIG would expect to amend and
restate the certificate of incorporation and bylaws of the surviving corporation
to make such changes it deems necessary or appropriate. In addition, if the
Merger is successfully completed, 100% of the Common Stock of the Company will
be held by AIG and the AIG Subs, the Common Stock of the Company will be
delisted from the New York Stock Exchange and would no longer be traded or
quoted, the Company will become eligible for termination of registration
pursuant to Section 12(g)(4) of the Exchange Act and the composition of the
Board of Directors of the Company would be changed to include solely individuals
designated by AIG. If the Merger is successfully completed, AIG would be able to
broaden its personal lines business through the combination of its existing
platform and that of the Company. In addition, if the Merger is successfully
completed, AIG may change the Company's business and corporate structure and may
sell, transfer or otherwise dispose of all or some of the Company's assets.
AIG expressly reserves the right to withdraw the proposed Merger, in its
sole discretion, prior to the execution of a definitive Acquisition Agreement
and to modify its proposal relating to the Merger in any way as a result of
negotiations or for any reason at all, including proposing alternative
acquisition structures.
AIG and the AIG Subs understand that any of their respective executive
officers and directors that hold shares of the Company's Common Stock do so for
investment purposes. Other than as described above, none of AIG or the AIG Subs
nor, to the best knowledge of the persons filing this Amendment, any of AIG's or
the AIG Subs' respective executive officers or directors, have any plans or
proposals that relate to or would result in any of the events set forth in Items
4(a) through (j) of Schedule 13D. However, if the proposed transaction does not
occur for any reason, AIG and the AIG Subs and their respective executive
officers and directors intend to review continuously the Company's business
affairs, general industry and economic conditions and the capital needs of AIG
and the AIG Subs. Based on such review, these entities and individuals may, from
time to time, determine to increase or decrease their ownership of Common Stock
of the Company, approve an extraordinary corporate transaction with regard to
the Company or engage in any of the events set forth in Items 4(a) through (j)
of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(A) AIG's and each AIG Sub's current ownership interests in the Company and
the Common Stock of the Company is set forth on the cover pages to this
Amendment No. 22 to Schedule 13D and is incorporated by reference herein. The
ownership percentages appearing on such pages have been calculated based on the
number of shares of Common Stock of the Company outstanding as of October 23,
2006 (86,377,135 shares) as reported by the Company in the Company's Quarterly
Report on Form 10-Q for the quarterly period ended September 30, 2006, as filed
with the SEC on November 2, 2006.
(B) AIG and each AIG Sub share voting and dispositive power as to all of
the shares of Common Stock owned by each such AIG Sub.
(C) AIG, American Home, Commerce & Industry, National Union, and New
Hampshire, to the best of each of their knowledge, AIG and the AIG Subs'
respective executive officers and directors (as listed in Exhibit A), have not
engaged in any transactions in the
10
Common Stock of the Company during the past sixty days. AIG has no available
information regarding transactions in the Common Stock of the Company by Messrs.
Greenberg and Matthews, SICO, Starr, Universal Foundation, the Greenberg
Foundation and the Greenberg Joint Tenancy Company or their respective directors
and executive officers.
(D) - (E) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
Contracts, arrangements, understandings or relationships with respect to
securities of the Issuer consist of the Investment and Strategic Alliance
Agreement, dated as of October 17, 1994, by and between 20th Century Industries
and AIG, and the Registration Rights Agreement, dated as of December 16, 1994,
by and between 20th Century Industries and AIG, each of which is attached as an
exhibit to the Statement on Schedule D dated December 16, 1994 previously filed
by AIG, and Amendment No. 1 to Investment and Strategic Alliance Agreement,
dated as of March 23, 1995, by and between 20th Century Industries and AIG,
which is attached as an exhibit to Amendment No. 1 to the Statement on Schedule
13D dated March 23, 1995 previously filed by AIG. All of such contracts,
arrangements, understandings and relationships are incorporated in their
entirety herein by reference.
Item 7. Materials to be Filed as Exhibits.
(A) List of the Directors and Executive Officers of American International
Group, Inc., American Home Assurance Company, Commerce & Industry Insurance
Company, New Hampshire Insurance Company, National Union Fire Insurance Company
of Pittsburgh, Pa., Starr International Company, Inc., C.V. Starr & Co., Inc.,
Universal Foundation, Inc., The Maurice R. and Corrine P. Greenberg Family
Foundation, Inc. and The Maurice R. and Corinne P. Greenberg Joint Tenancy
Corporation, Inc., their business addresses and principal occupations.
(B) Proposal Letter dated January 24, 2007.
(C) Press Release dated January 24, 2007.
(D) Investment and Strategic Alliance Agreement, dated as of October 17,
1994, by and between 20th Century Industries and AIG.
(E) Registration Rights Agreement, dated as of December 16, 1994, by and
between 20th Century Industries and AIG.
(F) Amendment No. 1 to Investment and Strategic Alliance Agreement, dated
as of March 23, 1995, by and between 20th Century Industries and AIG.
11
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Statement is true, complete and
correct.
Dated: January 24, 2007
AMERICAN INTERNATIONAL GROUP, INC.
By: /s/ Kathleen E. Shannon
------------------------------------
Name: Kathleen E. Shannon
Title: Senior Vice President and
Secretary
AMERICAN HOME ASSURANCE COMPANY
By: /s/ Robert S. Schimek
------------------------------------
Name: Robert S. Schimek
Title: Senior Vice President and
Treasurer
COMMERCE AND INDUSTRY INSURANCE COMPANY
By: /s/ Robert S. Schimek
------------------------------------
Name: Robert S. Schimek
Title: Senior Vice President and
Treasurer
NEW HAMPSHIRE INSURANCE COMPANY
By: /s/ Robert S. Schimek
------------------------------------
Name: Robert S. Schimek
Title: Senior Vice President and
Treasurer
NATIONAL UNION FIRE INSURANCE COMPANY OF
PITTSBURGH, PA.
By: /s/ Robert S. Schimek
------------------------------------
Name: Robert S. Schimek
Title: Senior Vice President and
Treasurer
12
EXHIBIT INDEX
Exhibit No. Description Location
- ----------- ----------- --------
A. List of the Directors and Executive Officers of American Filed herewith.
International Group, Inc., American Home Assurance Company,
Commerce and Industry Insurance Company, New Hampshire Insurance
Company, National Union Fire Insurance Company of Pittsburgh, Pa.,
Starr International Company, Inc., C.V. Starr & Co., Inc.,
Universal Foundation, Inc., The Maurice R. and Corrine P.
Greenberg Family Foundation, Inc. and The Maurice R. and Corinne
P. Greenberg Joint Tenancy Corporation, Inc., their business
addresses and principal occupations.
B. Proposal Letter dated January 24, 2007. Filed herewith.
C. Press Release dated January 24, 2007. Filed herewith.
D. Investment and Strategic Alliance Agreement, dated as of Incorporated by
October 17, 1994, by and between 20th Century Industries and AIG. reference to Exhibit
B to the Statement
on Schedule 13D,
dated December 16, 1994,
previously filed by AIG.
E. Registration Rights Agreement, dated as of December 16, 1994, by Incorporated by
and between 20th Century Industries and AIG. reference to Exhibit H
to the Statement on
Schedule 13D, dated
December 16, 1994,
previously filed by AIG.
F. Amendment No. 1 to Investment and Strategic Alliance Agreement, Incorporated by reference
dated as of March 23, 1995, by and between 20th Century Industries to Exhibit A to Amendment
and AIG. No. 1 to the Statement on
Schedule 13D, dated
March 23, 1995, previously
filed by AIG.
13
.
.
.
EXHIBIT A
DIRECTORS AND EXECUTIVE OFFICERS OF AMERICAN INTERNATIONAL GROUP, INC.
Marshall A. Cohen Director Counsel, Cassels, Brock & Blackwell Cassels, Brock & Blackwell, 40 King Street
West, 20th Floor, Toronto, Ontario M5H 3C2
Martin S. Feldstein Director Professor of Economics, Harvard National Bureau of Economic Research, Inc.,
University; President and CEO, National 1050 Massachusetts Avenue, Cambridge,
Bureau of Economic Research Massachusetts 02138
Ellen V. Futter Director President, American Museum of Natural American Museum of Natural History, Central
History Park West at 79th Street, New York,
New York 10024
Steven L. Hammerman Director Retired; Former Deputy Commissioner for c/o 70 Pine Street, New York, New York
Legal Matters for the New York Police 10270
Department and Vice Chairman, Merrill
Lynch & Co., Inc.
Richard C. Holbrooke Director Vice Chairman, Perseus LLC Perseus LLC, 1235 Avenue of the Americas,
New York, New York, 10019
Fred H. Langhammer Director Chairman, Global Affairs and Former Chief 767 Fifth Avenue, New York, New York 10153
Executive Officer, The Estee Lauder
Companies Inc.
George L. Miles Director President and Chief Executive Officer, 4802 Fifth Avenue, Pittsburgh, Pennsylvania
WQED Multimedia 15213
Morris W. Offit Director Co-Chief Executive Officer, Offit Hall 65 East 55th Street, New York, New York
Capital Management LLC 10022
James F. Orr III Director Chairman of the Board of Trustees, The 420 Fifth Avenue, New York, New York 10018
Rockefeller Foundation
Virginia M. Rometty Director Senior Vice President - Global Business Route 100, Mail Drop 2275, Building 2,
Services, International Business Machines Somers, New York 10589
Corporation
Martin J. Sullivan Director and President and Chief Executive Officer 70 Pine Street, New York, New York 10270
Executive Officer
Michael H. Sutton Director Consultant; Former Chief Accountant of c/o 70 Pine Street, New York, New York
the United States Securities and Exchange 10270
Commission
Edmund S.W. Tse Director and Senior Vice Chairman - Life Insurance American International Assurance Co., Ltd.,
Executive Officer 1 Stubbs Road, Hong Kong
Robert B. Willumstad Director Former President and Chief Operating 9 West 57th Street, New York, New York
Officer, Citigroup Inc. 10019
Frank G. Zarb Director Chairman, Frank Zarb Associates, LLC; 375 Park Avenue, New York, New York 10152
Senior Advisor, Hellman & Friedman LLC
14
Dr. Jacob A. Frenkel Executive Officer Vice Chairman - Global Economic Strategies 70 Pine Street, New York, New York 10270
Frank G. Wisner Executive Officer Vice Chairman - External Affairs 70 Pine Street, New York, New York 10270
Steven J. Bensinger Executive Officer Executive Vice President & Chief 70 Pine Street, New York, New York 10270
Financial Officer
Anastasia D. Kelly Executive Officer Executive Vice President, General Counsel 70 Pine Street, New York, New York 10270
and Senior Regulatory and Compliance
Officer.
Rodney O. Martin, Jr. Executive Officer Executive Vice President - Life Insurance 2929 Allen Parkway, Houston, Texas 77019
Kristian P. Moor Executive Officer Executive Vice President - Domestic 70 Pine Street, New York, New York 10270
General Insurance
Win J. Neuger Executive Officer Executive Vice President & Chief 70 Pine Street, New York, New York 10270
Investment Officer
Robert B. Sandler Executive Officer Executive Vice President - Domestic 70 Pine Street, New York, New York 10270
Personal Lines
Nicholas C. Walsh Executive Officer Executive Vice President - Foreign 70 Pine Street, New York, New York 10270
General Insurance
Jay S. Wintrob Executive Officer Executive Vice President - Retirement AIG Retirement Services, Inc., 1999 Avenue
Services of the Stars, Los Angeles, California 90067
William N. Dooley Executive Director Senior Vice President - Financial Services 70 Pine Street, New York, New York 10270
David L. Herzog Executive Officer Senior Vice President & Comptroller 70 Pine Street, New York, New York 10270
Robert E. Lewis Executive Officer Senior Vice President & Chief Risk Officer 70 Pine Street, New York, New York 10270
Brian T. Schreiber Executive Officer Senior Vice President - Strategic Planning 70 Pine Street, New York, New York 10270
DIRECTORS AND EXECUTIVE OFFICERS OF AMERICAN HOME ASSURANCE COMPANY
M. Bernard Aidinoff Director Retired Partner, Sullivan & Cromwell LLP Sullivan & Cromwell LLP, 125 Broad Street,
New York, New York 10004
Charles H. Dangelo Director and Vice President and Senior Reinsurance 110 William Street, New York New York 10038
Executive Officer Officer, AIG
John Q. Doyle Director and President 175 Water Street, New York, New York 10038
Executive Officer
Neil A. Faulkner Director Director 175 Water Street, New York, New York 10038
David N. Fields Director Director 70 Pine Street, New York, New York 10270
15
Kenneth V. Harkins Director and Senior Vice President and General Counsel 175 Water Street, New York, New York 10038
Executive Officer
David L. Herzog Director Senior Vice President & Comptroller, AIG 70 Pine Street, New York, New York 10270
Robert E. Lewis Director Senior Vice President and Chief Risk 70 Pine Street, New York, New York 10270
Officer, AIG
Kristian P. Moor Director and Executive Vice President - Domestic 70 Pine Street, New York, New York 10270
Executive Officer General Insurance, AIG
Win J. Neuger Director Executive Vice President and Chief 70 Pine Street, New York, New York 10270
Investment Officer, AIG
Robert S.H. Schimek Director and Senior Vice President and Treasurer 175 Water Street, New York, New York 10038
Executive Officer
Nicholas S. Tyler Director Vice President - Foreign General 175 Water Street, New York, New York 10038
Insurance, AIG
Nicholas C. Walsh Director and Executive Vice President - Foreign General 70 Pine Street, New York, New York 10270
Executive Officer Insurance, AIG
Frank H. Douglas, Jr. Executive Officer Senior Vice President and Casualty 70 Pine Street, New York, New York 10270
Actuary, AIG
James C. Roberts Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
Charles R. Schader Executive Officer Senior Vice President - Claims, AIG 175 Water Street, New York, New York 10038
Mark T. Willis Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
DIRECTORS AND EXECUTIVE OFFICERS OF COMMERCE AND INDUSTRY INSURANCE COMPANY
M. Bernard Aidinoff Director Retired Partner, Sullivan & Cromwell LLP Sullivan & Cromwell LLP, 125 Broad Street,
New York, New York 10004
Joseph L. Boren Director and President 175 Water Street, New York, New York 10038
Executive Officer
Charles Dangelo Director and Vice President and Senior Reinsurance 110 William Street, New York New York 10038
Executive Officer Officer, AIG
John Q. Doyle Director Vice President - Domestic General 175 Water Street, New York, New York 10038
Insurance, AIG
Neil A. Faulkner Director Director 175 Water Street, New York, New York 10038
David N. Fields Director Director 70 Pine Street, New York, New York 10270
16
David L. Herzog Director Senior Vice President & Comptroller, AIG 70 Pine Street, New York, New York 10270
Robert E. Lewis Director Senior Vice President and Chief Risk 70 Pine Street, New York, New York 10270
Officer, AIG
Kristian P. Moor Director and Executive Vice President - Domestic 70 Pine Street, New York, New York 10270
Executive Officer General Insurance, AIG
Win J. Neuger Director Executive Vice President and Chief 70 Pine Street, New York, New York 10270
Investment Officer, AIG
Robert S.H. Schimek Director and Senior Vice President and Treasurer 175 Water Street, New York, New York 10038
Executive Officer
Nicholas C. Walsh Director and Executive Vice President - Foreign General 70 Pine Street, New York, New York 10270
Executive Officer Insurance, AIG
Frank H. Douglas, Jr. Executive Officer Senior Vice President and Casualty 70 Pine Street, New York, New York 10270
Actuary, AIG
Kimberly M. Hanna Executive Officer Chief Underwriting Officer 175 Water Street, New York, New York 10038
Kenneth V. Harkins Executive Officer Senior Vice President and General Counsel 175 Water Street, New York, New York 10038
John T. O'Brien Executive Officer Chief Operating Officer and Executive 175 Water Street, New York, New York 10038
Vice President
Charles R. Schader Executive Officer Senior Vice President - Claims, AIG 175 Water Street, New York, New York 10038
DIRECTORS AND EXECUTIVE OFFICERS OF NEW HAMPSHIRE INSURANCE COMPANY
M. Bernard Aidinoff Director Retired Partner, Sullivan & Cromwell LLP Sullivan & Cromwell LLP, 125 Broad Street,
New York, New York 10004
Charles Dangelo Director and Vice President and Senior Reinsurance 110 William Street, New York, New York
Executive Officer Officer, AIG 10038
Neil A. Faulkner Director Director 175 Water Street, New York, New York 10038
David N. Fields Director Director 70 Pine Street, New York, New York 10270
David L. Herzog Director Senior Vice President & Comptroller, AIG 70 Pine Street, New York, New York 10270
Kristian P. Moor Director and Executive Vice President - Domestic 70 Pine Street, New York, New York 10270
Executive Officer General Insurance, AIG
Win J. Neuger Director Executive Vice President and Chief 70 Pine Street, New York, New York 10270
Investment Officer, AIG
17
Robert S.H. Schimek Director and Senior Vice President and Treasurer 175 Water Street, New York, New York 10038
Executive Officer
Nicholas S. Tyler Director Vice President - Foreign General 175 Water Street, New York, New York 10038
Insurance, AIG
Nicholas C. Walsh Director and Senior Vice President - Foreign General 70 Pine Street, New York, New York 10270
Executive Officer Insurance, AIG
Frank H. Douglas, Jr. Executive Officer Senior Vice President and Casualty 70 Pine Street, New York, New York 10270
Actuary, AIG
Kenneth V. Harkins Executive Officer Senior Vice President and General Counsel 175 Water Street, New York, New York 10038
Charles R. Schader Executive Officer Senior Vice President - Claims, AIG 175 Water Street, New York, New York 10038
DIRECTORS AND EXECUTIVE OFFICERS OF NATIONAL UNION FIRE INSURANCE COMPANY OF
PITTSBURGH, PA.
M. Bernard Aidinoff Director Retired Partner, Sullivan & Cromwell LLP Sullivan & Cromwell LLP, 125 Broad Street,
New York, New York 10004
Charles Dangelo Director and Vice President and Senior Reinsurance 110 William Street, New York, New York
Executive Officer Officer, AIG 10038
John Q. Doyle Director and President 175 Water Street, New York, New York 10038
Executive Officer
Neil A. Faulkner Director Director 175 Water Street, New York, New York 10038
David N. Fields Director Director 70 Pine Street, New York, New York 10270
David L. Herzog Director Senior Vice President and Comptroller, AIG 70 Pine Street, New York, New York 10270
Robert E. Lewis Director Senior Vice President and Chief Risk 70 Pine Street, New York, New York 10270
Officer, AIG
Kristian P. Moor Director and Executive Vice President - Domestic 70 Pine Street, New York, New York 10270
Executive Officer General Insurance, AIG
Win J. Neuger Director Executive Vice President and Chief 70 Pine Street, New York, New York 10270
Investment Officer, AIG
Robert S.H. Schimek Director and Senior Vice President and Treasurer 175 Water Street, New York, New York 10038
Executive Officer
Nicholas S. Tyler Director Vice President - Foreign General 175 Water Street, New York, New York 10038
Insurance, AIG
Nicholas C. Walsh Director and Senior Vice President - Foreign General 70 Pine Street, New York, New York 10270
Executive Officer Insurance, AIG
18
Gregory J. Flood Executive Officer Chief Operating Officer and Executive Vice 175 Water Street, New York, New York 10038
President
John R. Benedetto Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
Christopher V. Blum Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
Frank H. Douglas, Jr. Executive Officer Senior Vice President and Casualty 70 Pine Street, New York, New York 10270
Actuary, AIG
Heather Fox Executive Officer Senior Vice President and Chief 175 Water Street, New York, New York 10038
Underwriting Officer
Irwin H. Goldfarb Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
Kenneth V. Harkins Executive Officer Senior Vice President and General Counsel 175 Water Street, New York, New York 10038
Brian R. Inselberg Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
Peter J. McKenna Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
Scott A. Meyer Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
John A. Rudolf Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
Charles R. Schader Executive Officer Senior Vice President - Claim, AIG 175 Water Street, New York, New York 10038
Michael W. Smith Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
Mark T. Willis Executive Officer Senior Vice President 175 Water Street, New York, New York 10038
DIRECTORS AND EXECUTIVE OFFICERS OF STARR INTERNATIONAL COMPANY, INC.
Maurice R. Greenberg Chairman of the Chairman of the Board and director, Starr 399 Park Avenue, 17th Floor, New York, New
Board and Director International Company, Inc. and C.V. Starr York 10022
& Co., Inc.; Chief Executive Officer, C.V.
Starr & Co., Inc.; trustee of C.V. Starr &
Co., Inc. Trust; member, director and
Chairman of the Board, The Starr
Foundation.
Joseph C.H. Johnson President and President and Director 101 First Street, Hamilton, Bermuda HM 12
Director
19
Edward E. Matthews Managing Director Managing Director and director, Starr 399 Park Avenue, 17th Floor, New York, New
and Director International Company, Inc.; director and York 10022
President, C.V. Starr & Co., Inc.;
trustee, C.V. Starr & Co., Inc. Trust;
member and director, The Starr Foundation.
Houghton Freeman Director President, Freeman Foundation 499 Taber Hill Road, Stowe, VT 05672
Howard I. Smith Director Vice Chairman-Finance and Secretary, C.V. 399 Park Avenue, 17th Floor, New York, NY
Starr & Co., Inc. 10022
John J. Roberts Director Senior Advisor, American International Concordia Farms P.O. Box 703, Easton, MD
Group, Inc. 21601
Ernest Stempel Director Senior Advisor and Honorary Director, 70 Pine Street, New York, NY 10270
American International Group, Inc.
Cesar Zalamea Director President and Chief Executive Officer, Suite 1405-7, Two Exchange Square, 8
Starr International Company (Asia), Limited Connaught Place, Central, Hong Kong
DIRECTORS AND EXECUTIVE OFFICERS OF C.V. STARR & CO., INC.
Maurice R. Greenberg Chairman of the (See above) (See above)
Board, Director
and Chief
Executive Officer
Howard I. Smith Vice Chairman- (See above) (See above)
Finance and
Secretary and
Director
Edward E. Matthews President and (See above) (See above)
Director
Houghton Freeman Director (See above) (See above)
John J. Roberts Director (See above) (See above)
Bertil P-H Lundquist Director Executive, Vice President and General 399 Park Avenue, 17th Floor,
Counsel, C.V. Starr & Co., Inc. New York, New York 10022
Lawrence S. Greenberg Director Private Equity Investor 399 Park Avenue
17th Floor
New York, New York 10022
DIRECTORS AND EXECUTIVE OFFICERS OF UNIVERSAL FOUNDATION, INC.
Stuart Osborne President President of Universal Foundation Mercury House
and Director 101 Front Street
Hamilton HM 12, Bermuda
Eligia G. Fernando Director Retired Mercury House
101 Front Street
Hamilton HM 12, Bermuda
20
Cesar C. Zalamea Director (See above) (See above)
Aloysius B. Colayco Director Managing Director, Argosy Partners Argosy Partners
8th Floor, Pacific Star Building
Makati City, Philippines
Jennifer Barclay Secretary Secretary of Universal Foundation Mercury House
101 Front Street
Hamilton HM 12, Bermuda
Margaret Barnes Treasurer Treasurer of Universal Foundation Fitzwilliam Hall
Fitzwilliam Place
Dublin 2, Ireland
DIRECTORS AND EXECUTIVE OFFICERS OF THE MAURICE R. AND CORRINE P. GREENBERG
FAMILY FOUNDATION, INC.
Maurice R. Greenberg Chairman and (See above) (See above)
Director
Corrine P. Greenberg President and President and Director, Greenberg Foundation 399 Park Avenue, 17th Floor
Director New York, New York 10022
Jeffrey W. Greenberg Vice President and Vice President and Director, Greenberg 399 Park Avenue, 17th Floor
Director Foundation New York, New York 10022
Evan G. Greenberg Vice President and President and Chief Executive Officer, ACE 399 Park Avenue, 17th Floor
Director Limited New York, New York 10022
Lawrence S. Greenberg Vice President and Private Equity Investor 399 Park Avenue, 17th Floor
Director New York, New York 10022
Shake Nahapetian Treasurer Administrative Assistant, CV Starr 399 Park Avenue, 17th Floor
New York, New York 10022
DIRECTOR AND EXECUTIVE OFFICER OF THE MAURICE R. AND CORRINE P. GREENBERG JOINT
TENANCY CORPORATION, INC.
Maurice R. Greenberg Chairman, CEO, (See above) (See above)
President,
Treasurer,
Secretary and
Director
21
AMERICAN INTERNATIONAL GROUP, INC.
70 PINE STREET
NEW YORK, NEW YORK 10270
Martin J. Sullivan
President and
Chief Executive Officer
January 24, 2007
Board of Directors
21st Century Insurance Group
6301 Owensmouth Avenue
Woodland Hills, California 91367
Dear Board Members:
American International Group, Inc. ("AIG" or "we") is pleased to propose to
acquire for cash all of the outstanding shares of common stock, par value $0.001
(the "Shares"), of 21st Century Insurance Group (the "Company") not owned by AIG
and its subsidiaries at a purchase price of $19.75 per Share.
The proposed per Share price represents a 19.0% premium to today's closing
price and a 25.5% premium to the average closing price during the last twelve
months. The proposed per Share price also represents a multiple of 19.6x the
consensus estimates of the Company's 2007 earnings per share (based on a current
First Call estimate of $1.01 per share).
Through its subsidiaries American Home Assurance Company, Commerce and
Industry Insurance Company, National Union Fire Insurance Company of Pittsburgh,
Pa. and New Hampshire Insurance Company, AIG is the Company's largest
shareholder, owning approximately 61.9% of the outstanding Shares. This proposal
would enable the Company's public shareholders to monetize their investment at a
full and fair value for their Shares. We therefore are confident that our
proposal will be attractive to the Company's public shareholders and that the
Company's combination with AIG would serve the best long-term interests of the
Company and its policyholders.
The proposed transaction would be effected by means of a merger agreement
with the intention for the Company to become a wholly-owned subsidiary of AIG.
Following completion of the merger, the Company would be able to devote its full
energy and resources to building the business.
This proposal is subject to AIG's satisfactory completion of due diligence,
satisfaction of regulatory requirements and the approval by a special committee
comprised of directors of the Company who are independent of AIG. AIG is
interested only in acquiring the publicly held Shares of the Company, and has no
interest in selling
its controlling stake in the Company. Please be aware that in making this
proposal, AIG reserves the right both to withdraw this proposal prior to the
execution of a definitive merger agreement and to modify it in any way as a
result of negotiations or for any reason at all, including proposing alternative
acquisition structures.
Concurrent with sending this proposal to you, AIG is filing an amendment to
its Schedule 13D, as required by the Securities Exchange Act of 1934, and plans
to issue a press release. In connection with this proposal, AIG has engaged Banc
of America Securities LLC and J.P. Morgan Securities Inc. as financial advisors
and Sullivan & Cromwell LLP as legal advisor. We are happy to make them
available to you to help expedite the transaction.
We look forward to working with you.
Very truly yours,
/s/ Martin J. Sullivan
CONTACT: CHARLENE HAMRAH (INVESTMENT COMMUNITY)
(212) 770-7074
JOE NORTON (NEWS MEDIA)
(212) 770-3144
AMERICAN INTERNATIONAL GROUP, INC. PROPOSES TO ACQUIRE
PUBLICLY HELD SHARES OF 21ST CENTURY INSURANCE GROUP
- PROPOSED PRICE OF $19.75 IN CASH PER SHARE FOR THE 38.1% PUBLICLY
HELD SHARES
- 21ST CENTURY INSURANCE GROUP WOULD BECOME WHOLLY OWNED BY AIG
New York, January 24, 2007 - American International Group, Inc. (AIG)
announced today that it has submitted a letter to the board of directors of 21st
Century Insurance Group (21st Century) (NYSE: TW) proposing to acquire the
outstanding 38.1% publicly held shares of 21st Century for $19.75 per share in
cash. AIG and its subsidiaries own approximately 61.9% of the outstanding shares
of 21st Century. The aggregate cash consideration payable would be approximately
$690 million. Following the transaction, 21st Century would become a wholly
owned subsidiary of AIG. A copy of the letter sent by AIG to the 21st Century
board of directors is attached.
The proposed per share price represents a 19.0% premium to today's closing
price and a 25.5% premium to the average closing price during the last twelve
months. The proposed per share price also represents a multiple of 19.6x the
consensus estimates of 21st Century's 2007 earnings per share (based on a
current First Call estimate of $1.01 per share).
"Our proposal represents an excellent opportunity for 21st Century's
shareholders to monetize their investment at a full and fair value's for their
shares. For AIG, this is an opportunity to make a substantial additional
investment in a business we know well," said Martin J. Sullivan, President and
Chief Executive Officer of AIG.
AIG contemplates that the transaction would be implemented through a merger
agreement which would be negotiated and approved by a special committee
comprised of directors of 21st Century who are independent of AIG ("Special
Committee"). This proposal is subject to AIG's satisfactory completion of due
diligence, satisfaction of regulatory requirements and the approval of the
Special Committee.
AIG has advised 21st Century that AIG's sole interest is in acquiring the
remaining shares of 21st Century held by the public shareholders and that it has
no interest in a disposition of its controlling equity stake in 21st Century.
AIG reserves the right to withdraw its proposal prior to the execution of a
definitive merger agreement and to modify its proposal in any way as a result of
negotiations or for any reason at all, including proposing alternative
acquisition structures.
Banc of America Securities LLC and J.P. Morgan Securities Inc. are serving as
AIG's financial advisors and Sullivan & Cromwell LLP is serving as AIG's legal
advisor in the transaction.
21st Century shareholders and other interested parties are urged to read AIG's
and 21st Century's relevant documents filed with the Securities and Exchange
Commission ("SEC") when they become available because they will contain
important information. 21st Century shareholders will be able to obtain such
documents free of charge at the SEC's web site: www.sec.gov.
A copy of the letter sent by AIG to the 21st Century board of directors follows.
# # #
American International Group, Inc. (AIG), world leaders in insurance and
financial services, is the leading international insurance organization with
operations in more than 130 countries and jurisdictions. AIG companies serve
commercial, institutional and individual customers through the most extensive
worldwide property-casualty and life insurance networks of any insurer. In
addition, AIG companies are leading providers of retirement services, financial
services and asset management around the world. AIG's common stock is listed on
the New York Stock Exchange, as well as the stock exchanges in London, Paris,
Switzerland and Tokyo.
# # #
