Related Party Transactions

12 Months Ended

Dec. 31, 2015

Related Party Transactions [Abstract]

Related Party Transactions

Note 20: Related Party Transactions

Related parties are defined as the following:

• Affiliates of the Company: An affiliate is a party that directly or indirectly controls, is controlled by or is under common control with the Company. Control is defined as having, either directly or indirectly, the power to direct the management and operating policies of a company through ownership, by contract or otherwise.
• Entities for which investments are accounted for using the equity method by the Company.
• Trusts for the benefit of employees, such as pension and profit sharing trusts that are managed by or under the trusteeship of management.
• Principal owners of the Company defined as owners of record or known beneficial owners of more than 10% of the voting interests of the Company.
• Management of the Company which includes persons who are responsible for achieving the objectives of the Company and who have the authority to establish policies and make decisions by which those objectives are to be pursued. Management normally includes members of the Board of Directors, the Chief Executive Officer, Chief Operating Officer, Vice President in charge of principal business functions and other persons who perform similar policymaking functions.
• Members of the immediate families of principal owners of the Company and its management. This includes family members whom a principal owner or a member of management might control or influence or by whom they may be controlled or influenced because of the family relationship.
• Other parties with which the Company may deal if one party controls or can significantly influence the management or policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.
• Other parties that can significantly influence the management or policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to the extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

During 2015, certain investment funds affiliated with Warburg sold all of their 45.7 million shares of MBIA Inc. common stock. At the time of each sale, Warburg was the largest holder of the Company’s common stock. Warburg received all of the net proceeds from this offering. In connection with the sales, National and the Company repurchased 8 million shares and 7.6 million shares, respectively. In addition, the Company reported the expiration of the Warburg’s warrant to purchase 11.8 million shares at $29.44 per share, the Warburg’s B warrant to purchase 10.1 million shares at $29.44 per share and the Warburg’s B2 warrant to purchase 4,004,945 shares at $16.18 per share. As of December 31, 2015, Warburg had a warrant to purchase 1.91 million shares of MBIA common stock at an exercise price of $9.59 per share. Refer to “Note 18: Common and Preferred Stock” for information about Warburg’s warrants.

As of December 31,2015 and 2014, the Company had no loans outstanding to any executive officers or directors.