3...2..1...Ignition
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Mr. Simpson, I'd say August 1st
The restricted cash needs to move in order to level the playing field as AZ has eloquently stated. It's not happening before that IMVHO.
Cheers,
We are almost there next Wed Aug 1st.
Uncle Bo
Minutes 31-35
https://edge.media-server.com/m6/p/wzr2x7ha
"What is the expected yield ?
Also pretty interesting, minutes 25-28...
Cheers,
Uncle Bo
Based on the Conference call today ONLY...
I beg to differ here, somewhere in the Q&A towards the end - I think I heard a discussion on the profitability of the 800 Billion pipeline...and the answer to that was confirmed with a clarification to be 15 basis points...ON A PRE TAX basis - wow !!! I am not very good at math, but will give it my best try:
800,000,000,000 x 0.0015 = 1,200,000,000
If this is correct and if you use the current NSM EPS multiple of 9.5 and the proforma company (merged) shares of 1,117,000,000 then:
1,200,000,000 / 1,117,000,000 = 1.0743 in annual earnings (PRETAX ?!) for WMIH
1.0743 X 9.5 = 10.205 PPS (or whatever else the market decides)
In the end we may see NLU gone streaking... :o :o :o
Basis point (BPS) refers to a common unit of measure for interest rates and other percentages in finance. One basis point is equal to 1/100th of 1%, or 0.01%, or 0.0001, and is used to denote the percentage change in a financial instrument.
Justice, that's right...
Initially KKR offered them 100% cash and out, but then they had hesitation - may be wanted equity, but were then concerned about IRC 382 and their ability to manage liquidity or sell the position at will.
As you point out, they will have to ask for permission the WMIH BOD as this is in the corporate by laws for any significant holder > 5%. And yes Fortress may end up with as much as 17-18 %, very much on par with KKR. The deal is between them anyway - or so it seems...
Good luck to all !
Uncle Bo
Mr. Simpson - totally agree with you.
Fortress would have gotten 1.2 Billion dollars in cash...and instead they asked for some equity.
My gut feel is that the newly issued stock (which we hopefully approve) will be split evenly between them and the other NSM shareholders.
Cheers,
Uncle Bo
Mr. Simpson,
I would not rule this out, also keep in mind what Jay Bray said about future acquisitions. It will be done to enhance the servicing portfolio, but as far as the platform he believe NSM is best in class...
Let's hope the Friday's vote is "For the merger and the issuance of the stock" then will see what the future holds.
KKR should make money out of this and so should we riding their coat tails.
Uncle Bo
JWW, what does it mean ?
potentially we can shoot up to 1.95 from here ?!
Uncle Bo
You are welcome,
Fortress was also concerned with regards to their ability to sell the WMIH stock after the merger completed. See my next post.
Uncle Bo
NSM/WMIH Discussions regarding Fortress...
https://www.sec.gov/Archives/edgar/data/933136/000119312518092371/d544188ds4.htm
page 96
On November 1, 2017, WMIH submitted a preliminary indication of interest. WMIH proposed to acquire Nationstar in a merger with a cash/stock election, whereby approximately 32% of Nationstar shares would be exchanged for stock consideration comprised of WMIH common stock with an attributed value of $23.00 per share of Nationstar common stock and approximately 68% of Nationstar shares would be exchanged for cash consideration equal to $16.00 per share of Nationstar common stock. The proposal requested that Fortress would make an irrevocable election to take 100% of its consideration in cash, and the minority stockholders would have the ability to elect either stock or cash consideration, subject to a pro rata cutback mechanism if the cash election consideration was oversubscribed or undersubscribed. Following the closing of the proposed transaction, Nationstar stockholders would own 34% of the fully diluted equity of WMIH. WMIH indicated that it would require six weeks to complete diligence and definitive documentation, and its proposal was subject to final approval by WMIH’s board of directors. Consummation of the WMIH transaction would also be conditioned on the affirmative vote of WMIH shareholders to approve the stock issuance.
page 101
On December 12, 2017, WMIH delivered an updated second round proposal for the acquisition of 100% of Nationstar. The letter proposed acquiring approximately 31.9% of Nationstar shares for stock consideration comprised of WMIH common stock with an attributed value of $23.00 per share of Nationstar common stock and the remaining Nationstar shares for cash consideration equal to $18.00 per share of Nationstar common stock, an increase of $2.00 per share over WMIH’s November 1 proposal. The December 12 proposal no longer required Fortress to make a cash election in respect of its shares of Nationstar common stock. WMIH also provided debt commitment papers reflecting committed financing for up to $2.75 billion of debt to finance the transaction. The WMIH letter indicated the desire to sign definitive agreements by Sunday, December 17, 2017. The Nationstar special committee then held an in-person meeting at Davis Polk’s New York offices with Mr. Bray, representatives of Citi, Morgan Stanley, PJT Partners and Davis Polk in attendance and members of management and Debevoise participating by telephone to discuss the proposal from WMIH. The Nationstar special committee instructed representatives of Citi and Morgan Stanley to set up a meeting with representatives of WMIH later that week following a board meeting in New York.
page 102
from WMIH and Party A and potential timing. Party A was expected to deliver a final proposal at $18.00 in cash per share of Nationstar common stock on December 15, 2017, but had indicated that it would not be ready to sign definitive documentation until the middle of January. The Nationstar special committee then discussed the terms of the WMIH proposal with its advisors, including the potential value of the WMIH stock that would be received by Nationstar’s stockholders after giving effect to a potential transaction. Representatives of Fortress discussed issues regarding the WMIH proposal, including certainty of closing and Fortress’s ability to sell its WMIH common stock post-closing. The group also discussed requiring WMIH to provide as a condition to closing an opinion as to the availability of its deferred tax asset. Representatives of Citi indicated that it would likely be difficult for Citi to render an opinion that the merger consideration to be received by holders of Nationstar common stock, other than Fortress, was fair from a financial point of view to such holders, unless Fortress committed to make a cash election. Representatives of Davis Polk then reviewed the fiduciary duties of Nationstar’s directors under Delaware law in connection with the proposed transaction. Following the Nationstar special committee’s meeting, representatives of WMIH and Simpson arrived to present to the Nationstar special committee, Mr. Bray and their advisors. Following the presentation, the Nationstar special committee reconvened to discuss next steps and resolved to counter during the weekend for more value through a greater percentage of the combined company for Nationstar’s unaffiliated stockholders that received stock consideration. The Nationstar special committee instructed Davis Polk and Nationstar’s advisors to work towards signing definitive documentation with WMIH prior to open of trading on December 19, 2017, subject to reaching an agreement with WMIH on consideration.
page 103
The Nationstar special committee reconvened again on the evening of December 16, 2017 for a telephonic meeting with members of management and representatives of Citi, Morgan Stanley, PJT Partners, Davis Polk and Debevoise in attendance to receive an update on the status of discussions with WMIH. The Nationstar special committee reiterated the need for more value for Nationstar’s stockholders unaffiliated with Fortress from the WMIH transaction.
page 107
Also on February 10, 2018, as instructed by the Nationstar special committee, representatives of Citi had discussions with Fortress regarding obtaining a greater percentage of WMIH going-forward for Nationstar’s stockholders unaffiliated with Fortress, and Fortress agreed to make a cash election with respect to 50% of its shares of Nationstar common stock (which we refer to as the “mandatory election”). That afternoon, the Nationstar special committee held a telephonic meeting with senior members of management and representatives of Citi, Morgan Stanley, PJT Partners, Davis Polk and Debevoise in attendance to update the group on the negotiations with WMIH and Fortress. The directors discussed with management the outstanding issues to be negotiated with WMIH and Fortress and discussed potential negotiating strategies to maximize value for the shareholders of Nationstar that are unaffiliated with Fortress. That day, Cravath sent to Simpson a revised draft of the Fortress voting agreement, which included Fortress’s obligation to vote all of its shares of Nationstar common stock in favor of the merger (provided that such obligation would only apply to a number of Fortress’s shares equal to 35.00% of the total voting power of the outstanding shares of Nationstar common stock if the Nationstar board of directors made a Nationstar adverse recommendation change in compliance with the merger agreement solely in respect of a Nationstar intervening event) and Fortress’s right to transfer 50% of those shares after the Nationstar special meeting approving the merger.
page 108
Nationstar special committee their respective financial analyses in connection with the proposed merger. Thereafter, Citi rendered its oral opinion to the Nationstar board of directors, which was subsequently confirmed in writing by delivery of Citi’s written opinion addressed to the Nationstar board of directors dated February 12, 2018, as to, as of such date, the fairness, from a financial point of view, to the holders of Nationstar common stock, other than members of the Fortress Group, of the Minimum Average Per Share Consideration (as defined in Citi’s opinion) to be received by such holders after giving effect to the mandatory election in the merger pursuant to the merger agreement. At the request of the Nationstar special committee, representatives of PJT Partners then rendered its oral opinion to the Nationstar special committee (and PJT Partners’s written opinion was subsequently rendered on February 12, 2018, based on updated information PJT Partners was directed to use regarding the capitalization of Nationstar and WMIH as of such date and the resulting final exchange ratio), to the effect that, as of the date thereof and based upon and subject to the qualifications, limitations and assumptions stated in its opinion, taking into account the mandatory election by Fortress, the aggregate merger consideration to be received by Nationstar stockholders (other than Fortress) in the merger pursuant to the merger agreement, was fair to such holders from a financial point of view. The full text of the written opinions of Citi and PJT Partners, which describe, among other things, the respective assumptions made, procedures followed, matters considered, qualifications and limitations on the review undertaken in connection with the opinions, are attached as Appendix C and Appendix D, respectively. Management and counsel reviewed with the Nationstar board of directors and the Nationstar special committee the terms of the merger agreement and related agreements. Representatives of Richards Layton then reviewed the fiduciary duties of Nationstar’s directors under Delaware law in connection with the proposed transaction. Prior to the February 11, 2018 board meeting, Nationstar’s and the Nationstar special committee’s financial advisors provided the Nationstar board of directors and the Nationstar special committee and their counsel with information regarding their material relationships with Nationstar and certain potential bidders including WMIH.
NSM holders - cash OR stock ?!
WMIH shares election which the current NSM shareholders have to make will be a CLUE !
Reading through the S4, "Background of the merger" beginning on page 94 - initially KKR wanted Fortress completely out. Meaning, they offered them 100% cash, but Fortress said "Wait a minute, what if we want some equity ?" They then agreed that Fortress must take at least 50% in cash election for their holdings, but at the same time the other NSM shareholders also got the opportunity to participate on the deal and make "equity" or WMIH shares election, of course, subject to proration (read: not enough of it !!!). Think of it, NSM "other" shareholders are mostly institutions so shares election would be a "tax free" event. I have a gut feel that everyone would go in for the maximum equity election and these 2 groups get to split the portion of newly issued ~400 million shares designated as part of the price paid for the merger ($702 million dollars in value). We shall see...
Cheers
Uncle Bo
JWW, correct 8 + 3 = 11 business days
page 162...
https://www.sec.gov/Archives/edgar/data/933136/000119312518180676/d574669d424b3.htm
NSM shareholders must make an election 3 business days before the closing and WMIH/NSM will make a public announcement 8 business days before the election date BASED ON THE ANTICIPATED closing date (and off course providing all other conditions are met such as the shareholder's and regulatory approvals)
We will know 11 BUSINESS days ahead of time AND before the merger is actually consummated. Let's say all goes fine and dandy and they announce on July 2nd Monday, then add 11 business days and the merger closes on July 17th. The NSM holders will have to make an election by July 12th (3 business days before)
By the way, anyone has actual NSM election form they can share ?!
Cheers,
Uncle Bo
Thank you Mr. Simpson
we will know 8 business days in advance before the merger closes
Election Procedures
The election form will be mailed to Nationstar stockholders with this joint proxy statement/prospectus. The election form will allow each Nationstar stockholder to specify the number of shares of Nationstar common stock with respect to which such holder elects to receive cash consideration or stock consideration. The election must be made prior to the election deadline. The election deadline will be 5:00 p.m., New York City time, on the date that is three business days before the closing date. WMIH and Nationstar will publicly announce the anticipated election deadline at least eight business days before the anticipated closing date of the merger. If the closing date is delayed to a subsequent date, the election deadline will be similarly delayed to a subsequent date, and WMIH and Nationstar will promptly announce any such delay and, when determined, the rescheduled election deadline.
~They have made it .61 and they have made it $3.47~
BBANBOB, you are making some good points here. Let's not forget that the expectations are set $1.35 until the restricted 600 million SBP moves...that levels the playing field and we might see the animal spirits unleashed.
You are right it can go either way, however, they have said that this is going to be accretive from the get go...we shall see what they have in store for themselves and the rest of us.
GLTA,
Uncle Bo
AZ, Thank you for your insight yet again...
I have spoken with my broker several times and they have been clear that the markers, ALL markers, are controlled by the reorganized company. The broker will only do as WMIH Corp instructs them to...nothing less nothing more.
Also the remaining RMBS which are backing the preferred series, a quick note here. Everyone remembers that when Deutsche settled (a.k.a. Globic) we all saw the real numbers after nearly 10 years of these mortgages being run off. So from the original 165B-ish, there were just a bit over 13B left of unpaid principal balance or ~8%. Now take that percent and apply based on the assumption that the preferred backing mortgages have been liquidating at the same rate...
The original amounts total 7.5B which is comprised of 3B (Ps), 0.5B (Ks) and 3.5B (TPS used to be before the exchange event) - now all class 19.
So 7.5B x 8% = 600 million - Hm ?! Where have I seen this number...
Did you really think that KKR will flush their money down the toilet without any backing ?! I don't think so.
Oh, yeah and on top of that we just purchased a little revenue generating company and we have fully licensed re-insurance company.
Cheers,
Uncle Bo
What a refreshing read !
And yes Thank you Boarddork and AZC.
Very eloquently laid out 1), 2) and 3) - for those who may have forgotten...the other bankruptcy WMIIC, which was NEVER substantively consolidated with WMI Inc.'s bankruptcy. It was only jointly administered. What this means is that the assets from point 3) are beyond the reach of the parties involved in 1) and 2). Yep Bonderman surely knew that - being there done that !
All the best to ALL as we are moving along through the final stages of this saga.
Cheers,
Uncle Bo
Sunshine is the best disinfectant
ALLCommonShare,though not yet used', ... WHHMP preferred'
“A financing in and of itself was of no good consequence if KKR’s judgment of a company’s prospects proved to be mistaken, if the leverage proved too costly, or if unforeseen events undermined the best-laid plans. Thus, even as Henry Kravis grew accustomed to the showers of attention at the close of every KKR acquisition, he remained cautious. He liked to put it this way: “Don’t congratulate me when we buy it. Congratulate me when we sell it.”
-Henry Kravis, KKR
“When the deal is closed, the work begins.”
-Paul Raether, KKR
"We don’t subscribe to that doctrine. The corporation has obligations to all of its constituencies – suppliers, customers, employees, retirees, existing management, existing labor, the community, and of course, shareholders. Now, who takes priority? Well, you can make arguments for anybody at any given point in time. We simply do the following: we make as many people in the company shareholders as we possibly can. If managers are really thinking of the shareholders’ best interests – including their own – they will properly balance the concerns of all the constituencies relevant to the company. If one constituency’s interests gets seriously out of balance, the company will suffer; the shareholders will suffer; society will suffer.”
-Tokarz, KKR
“The nature of the relationship between owners and managers in a highly leveraged firm rested on a basic principle: make managers owners by making them invest a significant share of their personal wealth in the enterprises they manage, thus giving them stronger incentives to act in the best interests of all shareholders. The idea of this management investment scheme was to assure that managers had enough “skin in the game” to care about their company, but not so much that they might be overly conservative. The downside had to hurt, but not too much; the upside had to be sweet. The important thing was not simply to convert managers into shareholders, but to make them owners in every sense of the word – “owners of the results of their decisions,”
-as KKR partners liked to put it.
“But George Roberts acknowledged the ultimately speculative nature of any buyout, arguing that
"...you wind up bidding what you can afford to pay and finance and still get an adequate return. We just figured that if we could make three or four times our money in five or six years, it would be a good investment. We didn’t rely on twenty pages of computer printouts with all the numbers and all the balance sheets. A lot of it was by the seat of our pants.”
now...1.35 x 4 = 5.40 PPS, but is that gonna be it ?!
Denny,
The CEO said vote is expected in mid June, closure of the deal in Q3. Also 80% of the required regulatory approvals have already been obtained.
Cheers,
Uncle Bo
Yes Sir, this is the business now
corrections...
May 9-15th: WMIH 10-Q (1st Q 2018) - ON or before 5/10 (40 days)
5/3 NSM conference call for Q1 results, remember we are are buying this co
The amended 10K has zero to do with 10-Q
... give it 10 more days.
Cheers,
Uncle Bo
BOB, What P/E multiple should you pay...it depends!!!
http://caps.fool.com/Blogs/what-pe-multiple-should-you/942420
What P/E multiple should you pay for growth stocks?
Recs
In the 1977 annual letter to Berkshire Hathaway shareholders, Warren Buffet had the following to say about buying stocks:
We select our marketable equity securities in much the same way we would evaluate a business for acquisition in its entirety. We want the business to be (1) one that we can understand, (2) with favorable long-term prospects, (3) operated by honest and competent people, and (4) available at a very attractive price.
He goes onto to say that in later annual letters that there are dozens and dozens of companies that meet criteria 1-3, but meeting criteria 4 “often prevents action.”
In order to determine a price that investors should pay for a company, let’s delve into the Price to Earnings (P/E) multiple.
If a stock is trading at a P/E of 10, then the earnings yield on the market equity is about 10%. An example of this would be a stock is trading for $100/share and earns $10/share. Assuming that management deploys those earnings back into value-generating activities (dividends, buybacks, high-returning capital projects, etc.), you are earning a theoretical 10% per year on your investment. Part of the return might come through capital appreciation and part of the return might come via dividends.
If a stock is trading at a 15 multiple, you are paying more for those earnings. The earnings yield on this investment would be 6.7%. For a 20 P/E, the yield would be 5%; for a 30 P/E the yield would be 3.3% and for a 40 P/E the yield would be 2.5%.
So why would anyone want a 2.5, 3.3, or even a 5% theoretical earnings yield from a stock, when you can get a cash yield form a corporate bond? The earnings yield on a stock might not even happen – it’s theoretical!
Well the issue with a bond is that while it’s considered very safe, it isn’t going to grow any. If you buy a bond that yields 3%, years down the road you’re still only going to get 3%. Alternatively, if you buy a stock that is yielding 3% in earnings, and it grows 15% every year, by the end of the 10th year, your earnings yield on the initial purchase will be 12%! and if you happen to find one of those few companies that can grow earnings at 15% for 20 years, your earnings yield would be an astounding 50% per year by the 20th year!
These types of companies aren’t rare – their right in front of your face! Panera, Family Dollar, Bed Bath and Beyond – these are all companies that have growth earnings at double-digit clips for years and years.
But this doesn’t mean you should just pay any price for a stock that has the potential for growth. Expected growth can become derailed very quickly, and that expected 15% growth you were looking for could turn out to be more like 5% growth. Taking a conservative approach to paying for growth should be employed.
Peter Lynch’s philosophy on paying for growth stocks fell along these lines – you should simply try to buy stocks that the same P/E multiple that you expect the company to grow. So if you expect a company to grow earnings at 20% per year, you should pay a 20 P/E for the stock (this is where the PEG ratio comes from – a 20 PE divided by 20% growth gives you a PEG of 1.0).
However, this type of investment is truly an anomaly. A company trading at a 20 P/E provides an earnings yield of 5%. If this company were to actually grow at 20% per year, the 5% earnings yield you got at the initial purchase would balloon to 30% just by year 10. Lynch had a very strict criteria for paying for growth stocks – when you get your hands on these types, you are in for some serious market-beating returns.
Ben Graham on the other hand, offered up some advice that is a bit more theoretical about paying for growth. In his famous book, The Intelligent Investor, Graham suggested paying a bit more for companies as long as you are certain those growth rates are going to be achieved. For a stock expected to grow 3% per year, you could pay a 16 P/E and still see decent returns. For a stock expected to grow 6%, you could pay a 20 P/E. For a stock expected to grow 10%, you could pay a 30 P/E. But Graham is talking about long-term (10 year) growth rates, not the expected growth rate over a 2-3 year span.
And this makes sense! If you buy a company at a P/E 30 and are getting a 3.3% yield (for a PEG of 3.3), after 10 years of compounding at 10%, your earnings yield would be nearly 9%. That’s not bad, considering that the earnings growth likely won’t stop right there. From that point on, earnings would probably continue to grow, even if it’s at a rate slightly less than 10% per year.
So what advice should you follow? Finding companies with a PEG of 1.0 or paying a bit more like Graham suggests?
If you can actually find a company that is trading at the same P/E multiple as its long term expected growth rate, you should definitely pounce on it. It would likely return 15, 20, or even 30% growth per year. But – you need to be sure that the company has a realistic chance of meeting those growth expectations. I’d steer clear of Graham’s theoretical advice, simply due to the fact that investors need some margin of error when making purchasing decisions for growth stocks.
Here are a few companies that have been growing EPS in the double digits for a long, long, time, and are trading at reasonable P/E ratios.
Well, remember Kosturos was appointed CEO of "investment" nunc pro tunc
A&M, was Court Allowed to manage the continuing “Cash” returns...
AZC, yeppers...for those who are interested to know the truth. Goodness, complications is an understatement.
JWW,
yes the PPS belongs @1.75, this what NSM accepted as a premise for getting their 12.77 WMIH per 1 NSM share or 702 million consideration in equity.
Uncle Bo
Here is how Uq markers are described...
By one broker...
Small world COO worked at One West...
a bank created by Mr. Mnuchin...
Mr. Simpson,
April 27th: WMILT 1Q report due (no, it's 40 days from the end of the Q1 which is March 31st)
--May 10th at the latest
April 30th: Votes ?! (assumed)
May 14th: Last day for WMIH-NSM to list new Shares to the NASDAQ (no, approval of an application to list)
Cheers,
Uncle Bo
Mordi,
I think this is not correct 6B * 0.21 = 1.26B DTA, can you elaborate.
They say they will "un-reserve" 1.05B on the balance sheet.
Uncle Bo
Az,
Music to my ears, if one wants to learn...page 92 and read on, my personal favorite is on page 104 - what do you call them "The Columbia business school"
Cheers,
Uncle Bo
Biz,
I have spoken with broker on the subject a couple of times and this is what I was explained when I asked about the escrow CUSIPS:
"We have no control over these CUSIPS, "They" meaning the reorganized company WMIH has full control and we as a broker are at their mercy. They can change those CUSIPS to whatever they decide at any point in time..."
Take or leave, I myself am puzzled by this statement. The broker also said that WMILT is NOT in charge of the escrow CUSIPS.
Uncle Bo
Ilene,
Welcome back, I suppose you took a long vacation...
If you review the record since March of 2017 it became pretty apparent and actually glaring in the deck presented on 12/11/18 - what works WELL and what works LESS WELL. Apparently the deal which GD/DT tried to pull off in 2015 was one that worked LESS WELL. So yeah, you are right, KKR is the expert here and ever since they took over the transparency has increased and also the quality and detail of the filings improved IMO.
Best
Uncle Bo
Everyone remembers that ?!
http://www.kccllc.net/documents/8817600/8817600170920000000000001.pdf
Note 15: Subsequent Events
On December 8, 2017, WMIH filed a certificate of amendment, the Series B Amendment, to its Amended and Restated Certificate of Incorporation (the “Existing Charter” and, as amended by the Series B Amendment, the “Amended Charter”). The Series B Amendment became effective at 12:00 a.m., New York City time, on January 5, 2018.
The Series B Amendment, which was approved by the holders of 308,731, or approximately 51%, of the 600,000 issued and outstanding shares of Series B Preferred Stock, amended certain terms of WMIH’s issued and outstanding 3.00% Series B Convertible Preferred Stock, par value $0.00001 per share, to, among other things:
extend the Series B Redemption Date (as defined in the Existing Charter) from January 5, 2018 to October 5, 2019 (subject to a six-month extension in accordance with the terms of the Series B Amendment);
amend the Conversion Price (as defined in the Existing Charter) relating to a Mandatory Conversion (as defined in the Existing Charter) of the Series B Preferred Stock to $1.35 per share of WMIH’s common stock, par value $0.00001 per share;
change the quarterly 3.00% dividend payable in cash to a semi-annual 5.00% dividend payable in Common Stock (the “Regular Dividend”) if, as and when declared by WMIH’s Board of Directors;
provide for a special distribution of 19.04762 shares of common stock per share of Series B Preferred Stock upon the closing of any Acquisition (as defined in the Amended Charter); and
provided for a special stub dividend payable which was declared and paid by WMIH’s Board of Directors in cash for dividends accruing on the Series B Preferred Stock payable in arrears for the period December 15, 2017 to January 4, 2018.
The foregoing description of the Series B Amendment does not purport to be complete and is subject to, and qualified in its entirety by reference to, the full text of the Series B Amendment, which is included as Exhibit 3.1 of Form 8-K filed December 11, 2017 and which is incorporated herein by reference.
On January 18, 2018, WMIH filed a certificate of dissolution of WMIIC with the office of the Delaware secretary of state. The dissolution of WMIIC was effective immediately upon the filing of such certificate.
On January 31, 2018, WMIH and the WMI Liquidating Trust entered into Amendment No. 4 to the Transition Services Agreement which is included as Exhibit 10.1 of Form 8-K filed February 1, 2018 and which is incorporated herein by reference. This amendment updates the services provided by the Trust to WMIH and the rates charged for these services.
On February 2, 2018, the reinsurance agreement between WMMRC and RMIC was terminated in accordance with the provisions of the agreement and the remaining balance in the related trust account, approximately $230 thousand, was transferred to WMMRC on February 5, 2018.
On February 12, 2018, WMIH, Nationstar Mortgage Holdings Inc., a Delaware corporation that is currently listed on the New York Stock Exchange under the ticker “NSM” (“Nationstar”), and Wand Merger Corporation, a Delaware corporation and a wholly-owned subsidiary of WMIH (“Merger Sub”), entered into an Agreement and Plan of Merger (the “Merger Agreement”), pursuant to which, subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will merge with and into Nationstar (the “Nationstar Transaction” or the “Merger”), with Nationstar continuing as the surviving corporation and a wholly-owned subsidiary of WMIH. Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger (the “Effective Time”) and as a result of the Merger, each share of Nationstar’s common stock issued and outstanding immediately prior to the Effective Time (other than shares owned, directly or indirectly, by Nationstar, WMIH or Merger Sub or by any Nationstar stockholder who properly exercises and perfects appraisal of his, her or its shares under Delaware law) will be converted into the right to receive, at the election of the holder of such share, (i) $18.00 per share in cash, without interest, or (ii) 12.7793 shares of validly issued, fully paid and nonassessable shares of WMIH common stock, par value $0.00001 per share (“WMIH Common Stock”), subject in each case to pro rata cutbacks to the extent cash or stock is oversubscribed (the “Merger Consideration”). The aggregate amount of cash to be paid as Merger Consideration in the Merger is approximately $1.2 billion. WMIH currently plans to fund the cash component of the Merger Consideration, the repayment of approximately $1.9 billion of outstanding senior unsecured notes of Nationstar and its subsidiaries, and the payment of fees and expenses related to the Merger through a combination of escrowed funds, cash on hand, proceeds from the issuance of debt securities, and borrowings under credit facilities. WMIH has obtained $2.75 billion in debt commitments from certain lenders in connection with its financing plan, which commitment is subject to customary terms and conditions. Upon the closing of the Nationstar Transaction, all of the outstanding Series B Preferred Stock will be mandatorily converted into WMIH Common Stock at a price of $1.35 per share, and holders of Series B Preferred Stock will be entitled to a special, one-time distribution of WMIH Common Stock and accrued and unpaid dividends payable in WMIH Common Stock. For more information on the terms of the transaction, including fees to be paid to related parties, please see the Form 8-K filed with the SEC on February 14, 2018.
On February 13, 2018, the aggregate excess of loss reinsurance agreement between WMMRC and GMIC was terminated in accordance with the provisions of the agreement. The underlying trust and the related quota share agreement remains in place. In connection with this event, on February 16, 2018, WMMRC received approval from the Hawaii Insurance Division to request the transfer of $4.2 million from the GMIC trust account to WMMRC. As of the date of this report this transfer of assets has not occurred.
An example of subsequent event 10-K disclosure
Anything material related to WMIIC...
MUST be disclosed as a "subsequent event" in the coming 10-K. What happened to the equity interests, was there any capital loss ?! We shall see, however, if nothing is disclosed there, one should conclude that there is nothing there...
https://www.accountingtools.com/articles/subsequent-events-definition-and-usage.html
Uncle Bo
Yep, implied book value for WMIH IS 1.75