Washington Mutual, Inc. Files Supplemental Notice Regarding Implementation of Elections Made on Class 16 Ballots

SEATTLE, Nov. 16, 2010 /PRNewswire-FirstCall/ -- Washington Mutual, Inc. (Pink Sheets: WAMUQ) ("WMI" or the "Company") today announced that it has filed a supplemental notice (the "Supplemental Notice") regarding the implementation of elections made on Class 16 Ballots for holders of Allowed PIERS Claims with respect to the Company's proposed Plan of Reorganization (the "Plan").

The Supplemental Notice provides additional information regarding Section 20.2 of the Plan, pursuant to which holders of Allowed PIERS Claims have the right to elect on Class 16 Ballots to receive additional Creditor Cash, Cash on account of Liquidating Trust Interests, or Reorganized Common Stock.

The Supplemental Notice explains the following procedures regarding elections on Class 16 Ballots:

• Liquidating Trust Interests distributed to holders of Allowed PIERS Claims shall be issued in two classes:  Priority Liquidating Trust Interests and Residual Liquidating Trust Interests.
  • Priority Liquidating Trust Interests shall represent the right to receive priority distributions from the Liquidating Trust (before distributions are made on account of Residual Liquidating Trust Interests), and the cap on the value of the Priority Liquidating Trust Interests that will be issued on the Effective Date shall be based on the net assets of the Liquidating Trust on the Effective Date (the estimated value of the Liquidating Trust on the Effective Date, less the anticipated expenses of the Liquidating Trust post-Effective Date).
  • Residual Liquidating Trust Interests shall be distributed to holders of Allowed PIERS Claims to the extent that Allowed PIERS Claims are not fully satisfied by the distribution of Creditor Cash, Reorganized Common Stock and Priority Liquidating Trust Interests, such that the sum of the value of Creditor Cash, Reorganized Common Stock, Priority Liquidating Trust Interests and Residual Liquidating Trusts Interests distributed to each holder of an Allowed PIERS Claim shall equal the amount of such holder's Allowed PIERS Claim.
• To the extent that a holder of an Allowed PIERS Claim does not indicate an election on its Class 16 Ballot with respect to allocation of its proposed distribution, such holder shall receive its Pro Rata Share of Creditor Cash, Reorganized Common Stock, Priority Liquidating Trust Interests, and Residual Liquidating Trust Interests, without any adjustment on account of elections made by other Allowed PIERS Claim holders.  Similarly, to the extent that a holder of an Allowed PIERS Claim elects to receive 100% of its distribution as Creditor Cash or 100% of its distribution as Reorganized Common Stock, and no Creditor Cash or no Reorganized Common Stock, as the case may be, is available to holders of Allowed PIERS Claims on the Effective Date, such holder shall be treated as though it made no election on its Class 16 Ballot.
• Assuming Creditor Cash and/or Reorganized Common Stock is available for distribution to holders of Allowed PIERS Claims on the Effective Date, elections made on the Class 16 Ballots shall influence only the distribution of Creditor Cash, Reorganized Common Stock and Priority Liquidating Trust Interests (to the extent each is available), and not Residual Liquidating Trust Interests.  To the extent that a holder of an Allowed PIERS Claim elects to receive more than its Pro Rata Share of Creditor Cash, Reorganized Common Stock, or Cash on account of Liquidating Trust Interests, as the case may be, the amount of such election in excess of its Pro Rata Share shall be exchanged for Creditor Cash, Reorganized Common Stock, or Cash on account of Priority Liquidating Trust Interests (and not Residual Liquidating Trust Interests), as the case may be, that otherwise would have been allocated to such holder, on a dollar-for-dollar basis (meaning, the "exchange rate" is $1 of Creditor Cash for $1 face of Reorganized Common Stock for $1 face of Priority Liquidating Trust Interests).  The percentage elections indicated on each Class 16 Ballot, if any, must equal 100%.
• WMI estimates that the net assets of the Liquidating Trust and, thus, the aggregate face value of the Priority Liquidating Trust Interests on the Effective Date (without taking into account the value, if any, of claims and causes of action to be assigned to the Liquidating Trust) will be between $100 and $150 million.

The official Supplemental Notice filed with the Bankruptcy Court, as well as WMI's Plan and Disclosure Statement and the Settlement annexed to the Plan, are available at www.kccllc.net/wamu.  This press release is not intended as a solicitation for a vote on the Plan.

Capitalized terms used but not defined in this release shall have the meanings ascribed to them in the Plan.

For additional information, contact Kurtzman Carson Consultants LLC, at (888) 830-4644.

SOURCE Washington Mutual, Inc.