WMIH + Cooper Info
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Zitat boarddork:
ACS Commercial Solutions, WMB FA, and the WMI mortgages held in portfolio
ACS Commercial Solutions, another breadcrumb in the trail to proving WMI owned the $240B "mortgages held in portfolio".
"There have been rumors that many of the loans originated in late 2007 and 2008 were "Portfolio loans" but these portfolios have not been identified by Chase or the FDIC in foreclosure law suits across America. "
A really interesting read!
http://www.bankinginvestment.net/article/...shington-mutual-inc-wmi-/
"Per the said Motion the ACS discovery files allegedly show the following revelations:
ACS received paper loan origination files from Washington Mutual Inc (WMI) in Houston. [Not from WMB or WMBFA.]
ACS prepared the documents for scanning; the documents were not supposed to include the collateral file, which if found was returned to WMI.
ACS shipped the documents to Juarez, Mexico. The actual movement of files was videotaped by a Texas television news crew as previously written up on this blog.
ACS scanned the documents in Juarez, Mexico.
ACS stored the documents in Juarez, Mexico until WMI directed ACS to destroy the loan documents.
ACS destroyed the loan origination documents as ordered by WMI.
ACS made the loan origination document images available via the FileNet System software.
ACS provided remote scanning facilities to scan in documents like the collateral files into FileNet.
ACS scanned and thereafter maintained as the WMI Loan portfolio, ambiguously referred to as the WAMU Loan Portfolio.
ACS sold some of the records to JPMorgan Chase Bank, NA (Chase) and destroyed the rest.
The documents scanned included both the Plaintiff's Home Equity Lines of Credit. The FISERV insurance on the HELOC in this case list the lender name as WMI and not Washington Mutual Bank. This is evidence that the Receiver (FDIC) did not transfer the HELOC to Chase because it was never owned by Washington Mutual Bank."
The lineage of WMB FA and its relationship to WMI. Interestingly, the PAA does not list WMB FA (as a dba of WMI) as sold to JPM. WMB FA originated and held in portfolio loans, mostly written in 2007 and 2008, were not sold to JPM and are residuals of the WMI estate holders.
http://docslide.us/documents/...-mutual-bank-fa-status-1996-2007.html
This allegedly further suggests:
That Washington Mutual Bank FA (WMBFA) is a strawman lender name for Washington Mutual Inc. (WMI)
That Washington Mutual Inc. (WMI) was the original lender, not Washington Mutual Bank (WMB).
That Washington Mutual Bank (WMB) was never more than the servicer.
Conclusion:
If Washington Mutual Bank did not own the loan portfolio, which is apparently the case, then FDIC the Receiver could not have transferred the said loan portfolio to JPMorgan Chase Bank, NA on September 25, 2008.
This is evidence that WMB was the "Loan Servicer" and not the owner of the loan.
Thus, Chase is acting as a "Loan Servicer" having bought the servicing business from the FDIC as Receiver.
- ACS Commercial Solutions is listed in Walraths court in the creditor matrix for the WMI bk. They were NOT billing WMB for "WMI mortgages held in portfolio" management.
- ACS Commercial Solutions was a subsidiary of Affiliated Computer Services Inc, which was bought and is privately held by XEROX since 2009. ACS was/is a multi billion dollar organization providing document services for 10 of the largest banks. Now called 'XEROX Commercial Solutions'.
http://www.prnewswire.com/news-releases/...al-solutions-55326592.html
- ACS Launches eRX, Creating a Paperless Recording Environment for Lenders, Title Companies, and Counties Nationwide
http://www.prnewswire.com/news-releases/...s-nationwide-74688572.html
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Zitat kinged:
Board
Great information. Here is where I have a problem. Could JPM have been duped by taking on over $230 billion in liabilities and not getting corresponding assets that would at least match that value which is inclusive of the value of the servicing rights, banking locations, etc.?
There is no way that anyone would take on these liabilities without getting the asset value that those liabilities were used to purchase. In other words, JPM could NEVER pay back these depositors or the FHLB loan if they do not get the cash from the mortgages as they either mature, were refinanced, or were sold to another party.
I know Mains, who worked for the FDIC, made some comment about how JPM did not take ownership and that they are sitting on these deposit liabilities without the means of ever paying them back. (My interpretation) This would make sense based on your information above and other information presented. However, I just find it difficult to believe that JPM would agree to such a deal unless they were duped. And, if they were duped, they would be fighting the FDIC to take back responsibility for the deposit liabilities. If they weren't duped, why would they ever agree to such a ridiculous transaction?
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ZItat xfidfed1:
Thanks for the interesting article boarddork. Now let’s see if any of the author’s comments about the existence of loans generated by Washington Mutual Bank, FA (as the Lender) during 2007-2008, can be readily verified. To begin with, according to the Washington Mutual, Inc. 2005 Annual 10-K filed on March 15, 2006 (see below excerpt from page 6), it certainly appears that during 2005 Washington Mutual Bank, FA changed its name to Washington Mutual Bank (“WMB”).
So if the name Washington Mutual Bank, FA is no longer used after 2005, then I think it would be reasonable to assume that we would not find any new loans generated in 2007-2008 using that name as the Lender…Right ? WRONG ! This evening I performed a simple search on the Miami-Dade County, Florida Recorder’s website for the period January 1, 2007 through October 31, 2008, and here is what I found:
• Between March 6, 2007 and March 12, 2008, there were 37 new Loans (Mortgages) recorded, in which Washington Mutual Bank, FA is identified on page one as the “Lender”.
• Attached is page 1 of 7 pages of the list of said Mortgages, along with photocopies of page one of three loans that I sampled, which were recorded on March 6, 2007, September 25, 2007, and March 12, 2008.
• All three sampled loans have a loan number starting with “301”.
Next I performed a similar search on the Riverside County, CA Recorder’s website. However, due to space limitations on typing in a business name, all that would fit was “Washington Mutual”, and I used the same time period and type of recorded document (in California the term “Deed of Trust” is normally used instead of “Mortgage”). The search netted more than 3000 records. As evidenced by the attached summary listing showing only the first 15 Deeds of Trust recorded beginning January 2, 2007:
• 7 of them show “Washington Mutual Bank FA” as the Lender, and
• 8 of them show “Washington Mutual Bank” as the Lender
• Also note that three of the Borrowers appear to have each obtained two Loans- presumably a 1st and 2nd Deed of Trust (one from each of these two Lenders), and a fourth Borrower appears to have obtained two such loans from Washington Mutual Bank.
Now how can this all be if the name “Washington Mutual Bank, FA" no longer existed when all these loans were made ? What an intriguing situation we have here.
From page 6 of 2005 Annual 10-K:
“General
Washington Mutual, Inc. is a Washington State corporation. It owns two federal savings associations as well as numerous nonbank subsidiaries. Washington Mutual, Inc. is a savings and loan holding company. As a savings and loan holding company, Washington Mutual, Inc. is subject to regulation by the Office of Thrift Supervision (the “OTS”).
The federal savings associations are subject to extensive regulation and examination by the OTS, their primary federal regulator, as well as the Federal Deposit Insurance Corporation (“FDIC”). On January 1, 2005, the Company’s state savings bank, the former Washington Mutual Bank merged into Washington Mutual Bank, FA, and ceased to exist; subsequently, Washington Mutual Bank, FA changed its name to Washington Mutual Bank (“WMB”). Consequently, the Company no longer owns a state savings bank that is subject to regulation and supervision by the Director of Financial Institutions of the State of Washington. Its nonbank financial subsidiaries are also subject to various federal and state laws and regulations.”
http://app.quotemedia.com/quotetools/...webmasterId=500&name=WMIH
CORP.: 10-K, Sub-Doc 1&link=http%3A//quotemedia.10kwizard.com/filing.xml%3Frid%3D23%26ipage%3D4032160%26DSEQ%3D1%26SQDESC%3DSECTION_BODY%26doc%3D1&cp=on&type=HTML
https://www.boardpost.net/forum/...=dlattach;topic=9194.0;attach=2291
https://www.boardpost.net/forum/...=dlattach;topic=9194.0;attach=2292
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Zitat m_ar2000:
Dated: July 2, 2007
See footnote #1
Plaintiffs name HomeSide Lending, Inc. as one of the defendants in
this action. HomeSide Lending, Inc. no longer exists as such. The actual
party appearing herein is Washington Mutual Bank, F.A., as successor in
interest to HomeSide Lending, Inc. For ease of reference throughout this
memorandum, the defendant is referred to as “HomeSide.”
http://www.law.du.edu/documents/...brief-for-defendants-homseside.pdf
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Zitatende
MfG.L:)
Trishield Capital Management Lowers stake in WMIH CORPORATION (WMIH)
http://www.everythinghudson.com/industry/...ih-corporation-wmih/19525
By Bill Collins - March 31, 2016
WMIH CORPORATION (WMIH) :
Trishield Capital Management reduced its stake in WMIH CORPORATION by 33.26% during the Q4 period. The investment management company now holds a total of 2,549,601 shares of WMIH CORPORATION which is valued at $6 Million after selling 1,270,490 shares in WMIH CORPORATION according to the most recent disclosure to the SEC.WMIH CORPORATION makes up approximately 10.62% of Trishield Capital Management’s portfolio.
Other Hedge Funds, Including , Stratos Wealth Partners Ltd. added WMIH to its portfolio by purchasing 21,816 company shares during the Fourth Quarter which is valued at $51,268. Scoggin Management Lp added WMIH to its portfolio by purchasing 1,941,365 company shares during the Fourth Quarter which is valued at $4.6 Million. WMIH CORPORATION makes up approx 1.16% of Scoggin Management Lp’s portfolio. Ropes Wealth Advisors added WMIH to its portfolio by purchasing 60 company shares during the Fourth Quarter which is valued at $141. Schwab Charles Investment Management Inc added WMIH to its portfolio by purchasing 130,372 company shares during the Fourth Quarter which is valued at $306,374.
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http://www.nytimes.com/2016/03/31/business/...p;ref=dealbook&_r=0
ZItat det_sherlock:
Look what’s been going on behind the scenes regarding the “too big to fail” designation. And look who's front and center--Judge Collyer.
Does Judge Collyer have Wamu in the back of her mind, causing her to raise questions about regulators' decision-making processes? Like how the government “analyzes” a company’s inclusion in the “too big to fail” club?
“But Judge Rosemary M. Collyer of the Federal District Court for the District of Columbia overturned MetLife’s designation, raising questions about how regulators determine who is too big to fail.”
And, the articles point out, companies [Met Life and AIG/mortgage] are considering divesting business units to AVOID the “too big to fail” designation.
Are there others that might present an opportunity for WMIH?
Interesting reading.
det
[Dealbook, short version]
METLIFE WINS BATTLE TO REMOVE 'TOO BIG TO FAIL' LABEL
By AMIE TSANG
Opponents of the Dodd-Frank Act can rejoice. A judge in Washington overturned MetLife's designation as "too big to fail" on Wednesday, Victoria Finkle reports in DealBook.
The ruling, by Judge Rosemary M. Collyer of the Federal District Court for the District of Columbia, has raised questions about how regulators decide which institutions are too big to fail.
The judge upheld arguments that regulators failed to adequately assess the insurance company's vulnerability to extreme financial distress and the potential economic impact of the designation.
The Treasury Department maintained that it had "conducted a rigorous analysis of MetLife," but did not say whether it would appeal the ruling.
Some fear that the judge's decision could prevent regulators from taking the necessary steps to stop another situation like American International Group's near-collapse in 2008.
On the other hand House Republicans who have criticized the oversight council for a lack of transparency in deciding which institutions are systemically important will be emboldened.
The ruling was certainly a win for Eugene Scalia, the son of the late U.S. Supreme Court Justice Antonin Scalia, The Wall Street Journal reports.
As well as taking on MetLife's designation, Mr. Scalia has been chipping away at the Dodd-Frank Act since its implementation. Relying on a 1990s-era federal law requiring financial regulators to do a cost-benefit analysis of new rules, Mr. Scalia has successfully argued against parts of the law that fail to meet that standard. He has won against the Securities and Exchange Commission and the Commodity Futures Trading Commission.
The idea that MetLife could shed its designation is shocking to Stephen J. Lubben. If the Financial Stability Oversight Council can't designate MetLife, who can it designate? Mr. Lubben asks in the In Debt column.
MetLife has an enormous bond portfolio, a large derivatives book, substantial real estate holdings and significant connections with other systemically important financial institutions. It is plausible that it would create problems if MetLife were to fail.
The court didn't buy it and we don't know exactly why since the opinion is sealed. But we should expect an appeal. The losing party will want the full circuit to hear the case.
[Full Article, NY Times]
MetLife Wins Battle to Remove ‘Too Big to Fail’ Label
New York Times, By VICTORIA FINKLE, MARCH 30, 2016
WASHINGTON — Opponents of the Dodd-Frank financial overhaul won an important battle on Wednesday as a federal judge here stripped the “too big to fail” label from the insurance company MetLife.
With memories still fresh on how the American International Group’s 2008 near-collapse rattled the global financial system, the Dodd-Frank Act empowered regulators to classify certain large nonbank institutions as deserving as the big banks of increased capital requirements and greater scrutiny.
But Judge Rosemary M. Collyer of the Federal District Court for the District of Columbia overturned MetLife’s designation, raising questions about how regulators determine who is too big to fail.
The judge’s full opinion is currently under seal, but her order on Wednesday said that she had upheld arguments that regulators failed to adequately assess the insurance company’s vulnerability to extreme financial distress and the potential economic impact of the designation.
She also appeared to back, at least in part, MetLife’s charge that regulators relied on unsubstantiated assumptions or speculation during the designation process that were not supported by the reform law or regulators’ own interpretive guidance.
“Today’s ruling really vindicates our decision to seek a judicial review of that designation,” said Steven A. Kandarian, the chief executive and chairman of MetLife, the nation’s largest life insurer.
The Treasury Department said in a statement that it disagreed with the judge’s decision and that it would continue to defend the “designations process vigorously.”
Regulators, it said, “conducted a rigorous analysis of MetLife, including extensive engagement with the company, and determined that material financial distress at MetLife could pose such a threat to the financial system.”
A Treasury spokesman did not respond to requests for comment on whether the government would appeal the ruling. The Treasury Department, under Secretary Jacob J. Lew, leads a body of regulators created by Dodd-Frank — the Financial Stability Oversight Council — to make decisions about systemically important financial institutions.
Several supporters of Dodd-Frank said they hoped the legal fight would continue.
“I don’t think there’s any question that if this decision were allowed to stand, it would, at a minimum, slow down the regulation of systemic threats to the shadow banking system, and it may well prevent the regulation of those systemic threats,” said Dennis Kelleher, president and chief executive of Better Markets, an advocacy group.
Some warn that the decision could also sway future rule-making efforts. The Federal Reserve, for example, is writing new rules to oversee insurance companies deemed systemically important.
Robert J. Jackson, a professor at Columbia Law School and a former adviser to the Treasury Department, said that the judge’s decision on Wednesday could have a chilling effect.
“My concern would be that federal regulators are going to be afraid to take the steps they’ll need to take to stop another A.I.G.,” he said. (With other law professors, Mr. Jackson wrote an amicus brief in support of the government’s position.)
At the same time, the decision will most likely embolden House Republicans who have criticized the Treasury Department and the oversight council for not being more open about the process.
The House Financial Services Committee issued subpoenas to four Treasury officials this month, part of a fight for more information around the agency’s handling of the debt ceiling. Several lawmakers have also introduced legislation in recent years intended to make the council and the designation of nonbanks more transparent.
“The Financial Stability Oversight Council typifies the unfair Washington insider system that Americans have come to fear and loathe: powerful government bureaucrats, secretive government meetings, arbitrary and capricious rules and the power to pick winners and losers – and taxpayers always end up being the losers,” Representative Jeb Hensarling of Texas, the Republican chairman of the committee, said in a statement on Wednesday.
Besides MetLife and A.I.G., Prudential Financial and General Electric’s financing arm are the other nonbanks that have been designated systemically important. Some are already changing.
MetLife and General Electric’s finance arm are seeking to separate or sell businesses to lose the designation. A.I.G. has decided to streamline, but is stopping short of an outright breakup, something activist investors like Carl C. Icahn and John Paulson have pushed it to pursue.
Depending on the details of the judge’s full opinion, Prudential and A.I.G. may also weigh their own legal challenges.
“If Judge Collyer’s decision details her belief that the process is unlawful, then the odds of legal challenges from A.I.G. and Prudential increase,” said Isaac Boltansky, an analyst with Compass Point Research & Trading. “But if her decision is more narrowly defined and she says the process was incorrectly applied to MetLife, then the dynamics for A.I.G. and Prudential are unlikely changed.”
The firms themselves said little after the court ruling.
“We continuously review developments that impact our company, and we are evaluating what is in the best interests of the company and our shareholders,” said Scot Hoffman, a spokesman for Prudential Financial.
An A.I.G. spokesman declined to comment on the ruling.
MetLife was found to be systemically important in December 2014, and the company sued the government a month later. The two sides made their arguments before Judge Collyer last month.
At the time, the judge asked several questions that suggested that she might be skeptical of how regulators analyzed the MetLife case.
On Wednesday, Judge Collyer ordered both sides to file a notice by April 6 regarding whether any portions of the opinion should remain blocked from public view.
Mr. Kandarian of MetLife said that the court decision would not affect his company’s previously announced plans to spin off its retail life and annuity businesses, though he had previously acknowledged that the “too big to fail” label had played a role in the decision, among other factors.
“We are moving forward with the plan to separate the U.S. retail business,” he said.
Shares of MetLife rose over 5 percent on Wednesday.
Liz Moyer contributed reporting from New York.
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http://www.bloomberg.com/news/articles/2016-03-30/..._dlbkam_20160331
Zitat:
American International Group Inc.’s mortgage insurer, United Guaranty Corp., filed for an initial public offering as the parent company faces sustained pressure from activists to split up.
United Guaranty filed for an offering of $100 million, a placeholder figure that is used to calculate fees and will probably change. United Guaranty won’t receive any of the proceeds of the share sale, according to its IPO filing. JPMorgan Chase & Co. and Morgan Stanley are underwriting the deal.
AIG Chief Executive Officer Peter Hancock has faced continued calls from activist investors Carl Icahn and John Paulson to pursue a more drastic breakup of the company. Hancock has already said he’s planning to fully exit United Guaranty. In January, a plan was announced to sell up to 19.9 percent of the United Guaranty business in an IPO, the first step to a full separation.
The move comes at a quiet time for U.S. IPOs. The number of public offerings has languished of late as stock markets have been hit by volatility. Only nine companies -- all in the health-care industry -- have gone public this year, while others across industries have postponed their offerings.
AIG’s mortgage guarantor is the largest of its U.S. peers. Radian Group Inc., the No. 2 business by market share according to Bloomberg Intelligence, has dropped 8 percent this year amid stricter capital rules and heightened competition. Paulson, whom AIG agreed in February to nominate to its board, has invested in Radian.
United Guaranty reported net income of $359.8 million last year, down 8.6 percent from 2014. Revenue declined 11 percent to $922.6 million in the 12 months through December.
Since the separation plan was announced, United Guaranty has been deemed more risky by Standard & Poor’s. The rating agency downgraded the company this month on the view that the company would not benefit from implicit ongoing support from its parent after the spin off.
United Guaranty plans to list on the New York Stock Exchange.
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ZItat det_sherlock:
What if the work-in-progress WMIH acquisition isn’t a business unit we expect, but is one that will be used to beef up the Wamu Investment arm as the major going-forward business of WMIH?
det
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State Street to Buy G.E.’s Asset Management Business
NY Times, By CHAD BRAY, MARCH 30, 2016
LONDON — General Electric said on Wednesday that it had agreed to sell its asset management business to the State Street Corporation in a transaction worth up to $485 million.
The deal for GE Asset Management is expected to increase the assets under management at the State Street Global Advisors investment management unit by about $100 billion at closing and strengthening its equity and fixed-income teams, State Street said in a news release.
It is the latest sale as General Electric retreats from finance and refocuses on its industrial roots. The conglomerate said in April of last year that it planned to sell the bulk of GE Capital within two years. Since announcing its plans to sell the bulk of the business, GE Capital has entered into agreements for sales worth about $161 billion.
[original article shows GE share price movement charts here]
General Electric also announced in September that it was exploring the sale of its asset management business, which is not part of GE Capital. [det_sherlock note: It took 6 months from announcement to sale of the unit.]
“This sale is another example reflecting the attractiveness of G.E.’s financial services businesses in the marketplace,” Jeffrey R. Immelt, the G.E. chairman and chief executive, said in a news release.
The transaction is expected to close in the third quarter and is subject to regulatory approval.
GE Asset Management has more than $100 billion in assets under management and more than 100 institutional clients, including corporate and public retirement plans, foundations, and sovereign wealth funds.
Credit Suisse is advising General Electric on the transaction.
http://www.nytimes.com/2016/03/31/business/...1&pgtype=collection
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Zitat Scott Fox:
Slow week. Page 10 of the 10K. FWIW " Anti-takeover provisions in our Certificate of Incorporation and Amended and Restated Bylaws (“Bylaws”) and under Delaware law could make a third party acquisition of WMIH difficult.
WMIH’s Certificate of Incorporation and Bylaws currently contain provisions that could make it more difficult for a third party to acquire WMIH, even if doing so might be deemed beneficial by WMIH’s stockholders. These provisions could limit the price that investors might be willing to pay in the future for shares of WMIH’s common stock. WMIH is also subject to certain provisions of Delaware law that could delay, deter or prevent a change in control of WMIH.
We may need to sell additional shares of WMIH’s common stock or other securities in the future to meet WMIH’s capital requirements. In such circumstances, the ownership interests of WMIH’s stockholders prior to such sale could be substantially diluted.
WMIH has 3,500,000,000 shares of common stock authorized for issuance and 10,000,000 shares of preferred stock authorized for issuance. As of March 1, 2016, WMIH had 206,168,035 shares of its common stock issued and outstanding. The possibility of dilution posed by shares available for future sale could reduce the market price of WMIH’s common stock and could make it more difficult for WMIH to raise funds through equity offerings in the future. In fact, WMIH has consummated two corporate financing transactions that are, on an as-converted basis, dilutive to stockholders. Specifically, in connection with our Series A Convertible Preferred Stock (the “Series A Preferred Stock”) offering, effective January 30, 2014, WMIH issued 1,000,000 shares of Series A Preferred Stock, which may be converted into 10,065,629 shares of WMIH’s common stock, and Warrants to purchase 61,400,000 shares of WMIH’s common stock; and on January 5, 2015, in connection with the Series B Preferred Stock Financing, WMIH issued 600,000 shares of Series B Preferred Stock, which may be converted into 342,857,143 shares of WMIH’s common stock.
The value of WMIH’s common stock may be affected by terms and conditions of the Series B Preferred Stock, which is senior in priority to WMIH’s common stock. See “Risk Related to the Series B Preferred Stock”.
The redemption or repurchase of our Series B Preferred Stock may have a material adverse effect on holders of WMIH’s common stock.
We have limited business operations and assets. If we redeem or repurchase our Series B Preferred Stock, it is likely that our business and financial prospects will be adversely affected and the holders of WMIH’s common stock are likely to lose a significant part or all of their investment. While we would expect to seek alternative financing under those circumstances, there can be no assurance such financing would be available at terms we would determine to be acceptable, or at all."
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Zitat CSNY:
Nothing new here, and we've crunched these numbers many, many times. WMIH is on the hook to issue up to 600MM (or so) common, but we've been discussing this for over a year now. What this 'disclosure' doesn't explain is why first, KKR, and later, KKR and Citi, did not receive anti-dilution protection.
In my opinion they didn't get it because the lion's share of the remaining 2.9B shares are headed to benefit legacy shareholders. About 100MM or so of this 2.9B will be used to sweeten cash acquisitions and to provide compensation incentives for senior employees at operating subsidiaries. I discussed this recently with a couple of senior traders with about 40 years experience on Wall Street and in London between them. They were shocked when I told them the $10MM KKR deal (which they agreed was nothing but an option) and the $600MM KKR/Citi deals did not provide anti-dilution protection. They said this is very strange as that would be the greatest concern to sophisticated investors. They agreed that the 3.5B authorization is exceptional and that it is very likely that players like Savitz and Tepper (who got to the trough first) will receive the lion's share of those common shares. I told them that in my opinion KKR and Citi were offered participation on a 'take it or leave it' basis and there was enough in it for them through a relatively small investment to take those terms.
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Zitat Scott Fox:
Yeah, like I said, slow week. Thanks for sharing this discussion. I can't see the BOD doing anything to dilute their shares, especially at our low share price. We are only investors but over 30% of stockholders are institutions. If the BOD would open us up to dilution the funds would likely call for their heads and exclude them from the 'club'. It's going to continue to be dull here until we get news of any kind. The share price is being held too tightly for there not to be a reason for it. Did I read it right where it said no inter-company transfers of funds until the notes are paid in full? I think it was on page 8, 9 or 10. They stated that any money transferred could go towards a M/A IF NEEDED.
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Sorry, page 6. It does look to me that the run-off notes don't have to be paid, only if WMIH wants/needs to gain access to profits for making a deal. I can see a payoff if no deal is pending or there is no need for funds. "Risks Related to Our Business"
WMIH and its subsidiaries have limited operations; WMIH is a holding company, and its only material assets are cash on hand, cash held in trust and its equity interests in its operating subsidiary and its other investments, and WMIH’s principal source of revenue and cash flow are distributions and certain payments from our wholly-owned subsidiary, WMMRC, which is operating in runoff mode and is subject to restrictions from paying us dividends and investment income from our investment portfolio.
As a holding company, our only material assets are our cash on hand, cash held in trust, the equity interests in our subsidiaries (WMMRC and WMIIC) and other investments. As of December 31, 2015, WMIH had no operations other than WMMRC’s legacy reinsurance business with respect to mortgage insurance which is being operated in runoff mode. WMMRC has not written any new business since the Petition Date. As of December 31, 2015, excluding restricted cash and assets held in trust, we had approximately $76.4 million in cash, cash equivalents, and investments, which includes $6.5 million held by our wholly-owned subsidiary, WMMRC; WMIIC holds no assets and generates no revenues. For the foreseeable future, our principal source of revenue and cash flow will be investment income from our investment portfolio, if any, cash and cash equivalents on hand, distributions from our operating subsidiary, if any, and certain payments made to us by WMMRC pursuant to the Administrative Services Agreement, dated as of March 19, 2012, between WMIH and WMMRC (the “Administrative Services Agreement”) and the Investment Management Agreement, dated as of March 19, 2012, between WMIH and WMMRC (the “Investment Management Agreement”). WMMRC is restricted by the Second Lien Indenture from making distributions to WMIH until the Runoff Notes are paid in full and is restricted by insurance law from making distributions to us unless prior approval is obtained from the Insurance Commissioner of the State of Hawaii. Thus, our ability to service our debt, finance acquisitions and pay dividends to our stockholders in the future is dependent on (i) the ability of our operating subsidiary to generate sufficient net income and cash flows to make upstream cash distributions to us, and (ii) our ability to obtain access to the funds held in escrow from the Series B Preferred Stock Financing. Our subsidiaries are and will be separate legal entities, and although they may be wholly-owned or controlled by us, they have no obligation to make any funds available to us, whether in the form of loans, dividends, distributions or otherwise except for distributions of Runoff Proceeds (as defined in the Indentures) to pay the holders of the Runoff Notes under the Indentures. The ability of our operating subsidiary to distribute cash to us will also be subject to, among other things, restrictions that are contained in our Second Lien Indenture, availability of sufficient funds and applicable state laws and regulatory restrictions. Claims of creditors of our subsidiaries generally will have priority as to the assets of such subsidiaries over our claims and claims of our creditors and stockholders. To the extent the ability of our operating subsidiary to distribute dividends or other payments to us could be limited in any way, this could materially limit our ability to grow, pursue business opportunities or make acquisitions that could be beneficial to our businesses, fund and conduct our business or fund dividends, redemptions or repurchases.
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Zitat kenwalker:
Remember the NOL Poison pill ability with these "shares".
Summary of a Section 382 "Poison Pill." Many public companies with significant NOLs and NCLs have recently adopted poison pill plans that are intended to
discourage an ownership change. In 2009, over 40 public companies adopted section
382 poison pills, including Citigroup Inc.-and Ford Motor Company. A section 38~
poison pill is similar to an anti-takeover "poison pill," except that an anti-takeover
poison pill will typically have a higher ownership threshold (10% to 20%) than
a section 382 poison pill (4.9%). Under a section 382 poison pill, each shareholder (
would receive a right entitling it to acquire a preferred stock interest that is economically equivalent to a share of common stock. If a shareholder engages in
a transaction that creates a prohibited percentage point increase, the other shareholders would be able to exercise their rights and acquire the preferred stock
interest at a significant discount (e:g., 50%) compared to the value of the corporation's outstanding common stock. As a result, the shareholder engaging in
the prohibited transaction would be diluted.
………… where’s the exercise right? We don’t need them because at any point they could do the escrow swap. When, how much? Fluid situation and it needs to be timed and though it could be enacted it needs to be held back to an assets swap so KKR “gets” something also.
My reading of NOL's is: easy to loose / hard to buy. The rules are set up where you can sell but ( greater than 5% owner ) you can't buy without shooting your foot.
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ZItat Scott Fox:
Mostly protecting themselves JJ. Most companies use this type of wording in their releases. 3.5 billion shares authorized is a huge amount for a company our size or many larger ones. There was a reason for that number to be agreed upon IMO.
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Zitat kinged:
"The redemption or repurchase of our Series B Preferred Stock may have a material adverse effect on holders of WMIH’s common stock.
We have limited business operations and assets. If we redeem or repurchase our Series B Preferred Stock, it is likely that our business and financial prospects will be adversely affected and the holders of WMIH’s common stock are likely to lose a significant part or all of their investment. While we would expect to seek alternative financing under those circumstances, there can be no assurance such financing would be available at terms we would determine to be acceptable, or at all."
As the deadline approaches whereby the requirements are met to convert preferred shares to common shares, one could argue that the risk for WMIH common shareholders significantly increases. There will be $600mm in cash due to those preferred holders and WMIH will NOT have the capital. Stock price will be adversely affected well before the deadline hits. Of course, if anyone is paying attention, this is highly unlikely as those players did not inject the cash into WMIH to end up trying to get it back later.
This means that if a deal does not get done in a reasonable amount of time prior to the deadline, a press release indicating that the deadline has been extended will surely be announced. Share price will pop upon such an announcement, but will likely be very short lived as the announcement could be interpreted as a lack of a deal coming sooner than later.
I have discussed share price in the past with the argument that a floor has been put in place based on the conversion. However, any major market correction or a lack of a deal with deadline getting closer will surely cause share price to drop below that floor. Will we see $1.75 again? Doubtful, but possible.
Thinking about how much cash WMIH has already burned away with just the preferred capital raise itself and the lost deal, the big players that invested must see the potential for a much greater return than that $50mm or so. Interesting to think about.
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Zitat kenwalker:
An "owner shift" is any change in the ownership of the stock of the loss corporation that affects the percentage of stock of such corporation owned by any person who is or becomes a 5-percent shareholder before or after such change. Treas. Reg. § 1.382-2T(e)(1). For example, the acquisition of additional stock by an existing 5-percent shareholder would constitute an "owner shift."
Warrants or Preferred Stock is one thing .............. common stock another. Short of a gradual shift the greater than 5%'er are locked in or ................... locked out.
IRC sections 382 and 383 provide that, where the ownership of a company changes by more than 50 percentage points in any 3-year period ( and ) the lowest percentage of stock of the loss corporation (or any predecessor corporation) owned by such shareholders at any time during the testing period.
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Zitatende
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http://www.dailybusinessreview.com/law-news/...7860989&curindex=2
ZItat:
A purchase and assumption agreement was not enough to prove JPMorgan Chase Bank N.A.'s legal standing in a foreclosure case before the Fourth District Court of Appeal.
The bank filed suit as successor to defunct Washington Mutual Bank against homeowners Ottoniel and Luz Cruz, alleging it was the owner of a real estate debt that changed hands at least five times.
JPMorgan Chase purchased the debt in September 2008 from the Federal Deposit Insurance Corp. when WAMU was in receivership, but that deal was one in a string of transfers.
The original borrower executed a mortgage and note with WAMU and later quitclaimed the property to the Cruzes, who defaulted in December 2008.
By the time JPMorgan Chase filed a foreclosure lawsuit in April 2009, it appeared to have lost track of the note. Its complaint included a copy of the mortgage with a count to reestablish a lost note, alleging the bank owned the debt but couldn't locate the paperwork to prove it.
In October 2009, JPMorgan Chase dropped the lost-note count but moved to reintroduce it years later after yet another transfer — this time to PennyMac Corp. in 2014.
"Because they didn't have possession of the note, they had to rely on the purchase and assumption agreement, which the Fourth DCA found insufficient," said defense attorney Ricardo M. Corona Jr. of the Corona Law Firm in Miami.
At a nonjury trial, the bank presented a copy of the note endorsed in blank but not the original. It also called a PennyMac Loan Services foreclosure operations supervisor as a witness to establish its standing.
That proved to be a misstep after the witness testified JPMorgan Chase was the previous servicer and PennyMac Loan serviced the loan on behalf of the current owner, PennyMac Corp.
"The number of entities through which the note and mortgage traveled complicates the facts," Judge Melanie May wrote in the March 23 unanimous decision. "The bottom line, however, is JPMorgan Chase Bank National Association's failure to prove standing requires a reversal of the final judgment of foreclosure."
District Judge Alan Forst and Palm Beach Circuit Judge Rosemarie Scher, sitting by special designation, concurred.
Akerman attorneys Nancy Wallace, William Heller and Kathryn Hoeck represented JPMorgan Chase on appeal. They did not respond to requests for comment by deadline.
"The main issue is that they make these transfers electronically and come into court with nothing to show," said Ricardo Corona Sr., who teamed with his son and Coral Gables attorney Paul Bravo to represent the Cruzes. "When the court requires them to show proof, they can't or they won't."
Samantha Joseph can be reached at 954-468-2614.
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Zitatende
MfG.L:)