First Acceptance : 2021 Annual Information and Disclosure Statement

FIRST ACCEPTANCE CORPORATION

ANNUAL INFORMATION AND DISCLOSURE STATEMENT

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2021

Table of Contents
Part A - General Company Information ....................................................................................................................................................	3
Part B - Share Structure.............................................................................................................................................................................	4
Part C - Business Information ...................................................................................................................................................................	6
Part D - Management Structure and Financial Information ....................................................................................................................	12
Part E - Issuance History .........................................................................................................................................................................	20
Part F - Exhibits ......................................................................................................................................................................................	20

Part A - General Company Information

Item 1. The Exact Name of The Issuer

First Acceptance Corporation

Item 2. The Address of The Issuer's Principal Executive Offices

Principal Executive Offices:	First Acceptance Corporation
	3813 Green Hills Village Drive
	Nashville, TN 37215
	Telephone: [phone]
	Web: www.acceptance.com
Investor Relations:	Michael J. Bodayle
	Vice President, Secretary & Treasurer
	First Acceptance Corporation
	3813 Green Hills Village Drive
	Nashville, TN 37215
	Telephone: [phone]
	Email: [e-mail]

Item 3. The Jurisdiction and Date of the Issuer's Incorporation

First Acceptance Corporation was incorporated in the state of Delaware in 1996.

3

Part B - Share Structure

Item 4. The Exact Title and Class of Securities Outstanding

Class:	Common Stock
CUSIP:	318457108

Trading Symbol: FACO

Item 5. Par or Stated Value and Description of the Security

A. Par or Stated Value

The Company's outstanding securities consists solely of common stock, par value $0.01 per share.

B. Common Stock or Preferred Stock

Common Stock

Stockholders of the Company are entitled to dividends if declared by the Board of Directors. Each share of our common stock entitles the holder thereof to one vote on all matters submitted to a vote of the stockholders. Our common stock is not subject to redemption or future calls or assessment by First Acceptance Corporation. Holders of common stock do not have preemptive rights, or rights to convert their common stock into other securities. In the event of a liquidation, dissolution or winding up of the affairs of First Acceptance Corporation, holders of our common stock have the right to a ratable portion of the assets remaining after the payment of all liabilities. All outstanding shares of our common stock are fully paid and nonassessable.

The provisions of First Acceptance Corporation's articles of incorporation and bylaws that are summarized below may have an anti- takeover effect and may delay, defer or prevent a tender offer or takeover attempt that a stockholder might consider to be in such stockholder's best interests, including those attempts that might result in a premium over the market price for the shares held by stockholders:

• the requirement that only stockholders owning at least one-third of the outstanding shares of our common stock may call a special stockholders' meeting; and
• the requirement that stockholders owning at least two-thirds of the outstanding shares of our common stock must approve any amendment to our certificate of incorporation provisions concerning the ability to call special stockholders' meetings.

Under our certificate of incorporation, we may issue shares of preferred stock on terms that are unfavorable to the holders of our common stock. The issuance of shares of preferred stock could also prevent or inhibit a third party from acquiring us. The existence of these provisions could depress the price of our common stock, could delay or prevent a takeover attempt or could prevent attempts to replace or remove incumbent management.

On May 4, 2021, the Board of Directors declared a special cash dividend of $0.27 per common share, that was paid on June 4, 2021, to all common stockholders of record as of the close of business on May 20, 2021. On December 6, 2021, the Board of Directors declared another special cash dividend of $0.11 per common share, that was paid on December 21, 2021, to all common stockholders of record as of the close of business on December 16, 2021. Both dividends are non-taxable return of capital distributions to stockholders.

4

Item 6. The Number of Shares or Total Amount of the Securities Outstanding for Each Class of Securities Authorized

Common Shares		December 31, 2021		December 31, 2020
Number of Shares Authorized		75,000,000		75,000,000
Number of Shares Outstanding	38,006,091	38,135,051
Freely Tradeable Shares (Public Float)		10,309,527		10,870,715
Total Number of Stockholders of Record		240		251
Preferred Shares		December 31, 2021		December 31, 2020
Number of Shares Authorized		10,000,000		10,000,000
Number of Shares Outstanding		-		-
Freely Tradeable Shares (Public Float)		-		-
Total Number of Stockholders of Record		-		-

The Company has more than 50 beneficial stockholders of record owning at least 100 shares.

Item 7. The Name and Address of the Transfer Agent

Computershare is registered as a transfer agent under the Exchange Act.

Consuelo Galicia, Assistant Vice President and Relationship Manager Computershare

6200 S. Quebec St. Greenwood Village, CO 80111 [e-mail]

5