EX-99 2 mm09-3009_8ke991aug.htm

EXHIBIT 99.1

 

UNITED STATES BANKRUPTCY COURT

DISTRICT OF DELAWARE

In re Washington Mutual, Inc., et al.                                               Case No. 08-12229 (MFW)

Reporting Period: 08-01-09 to 08-31-09

 

MONTHLY OPERATING REPORT

REQUIRED DOCUMENTS

Form No.

Document
Attached

Explanation
Attached

Schedule of Cash Receipts and Disbursements

MOR-1

Yes

 

Bank Reconciliation (or copies of Debtors’ bank reconciliations)

MOR-1a

Refer to attached stmt

 

Schedule of Professional Fees Paid

MOR-1b

Yes

 

Copies of bank statements

MOR-1c

Refer to attached stmt

 

Cash disbursements journals

 

n/a

Refer to MOR 1 for summary of all disbursements.

Statement of Operations

MOR-2

Yes

See attached notes

Balance Sheet

MOR-3

Yes

See attached notes

Status of Postpetition Taxes

MOR-4

Yes

 

Copies of IRS Form 6123 or payment receipt

 

n/a

Payroll services outsourced including remission of taxes

Copies of tax returns filed during reporting period

 

n/a

See listing of filings

Summary of Unpaid Postpetition Debts

MOR-4

n/a

Detail on face of balance sheet.

Listing of aged accounts payable

MOR-4

Yes

 

Accounts Receivable Reconciliation and Aging

MOR-5

n/a

No trade receivables

Debtor Questionnaire

MOR-5

Yes

 

 

I declare under penalty of perjury (28 U.S.C. Section 1746) that this report and the documents attached are true and correct to the best of my knowledge and belief.

 

 

 

 

/s/ John Maciel

 

September 29, 2009

Signature of Authorized Individual*

Date

 

 

 

 

 

 

John Maciel

 

Chief Financial Officer

Printed Name of Authorized Individual

Title of Authorized Individual

 

 

*Authorized individual must be an officer, director or shareholder if debtor is a corporation; a partner if debtor is a partnership; a manager or member if debtor is a limited liability company.

 

 

                                                                                                

 

 


re Washington Mutual, Inc., et al

Case No. 08-12229 (MFW)

 

 

DISCLAIMER

 

Washington Mutual, Inc. (“WMI”) and WMI Investment Corp. (together, the “Debtors”) caution investors and potential investors in WMI not to place undue reliance upon the information contained in this Monthly Operating Report, which was not prepared for the purpose of providing the basis for an investment decision relating to any of the securities of WMI. The Monthly Operating Report is limited in scope, covers a limited time period, and has been prepared solely for the purpose of complying with the monthly reporting requirements of the Bankruptcy Court and the United States Trustee. The Monthly Operating Report was not audited or reviewed by independent accountants; does not purport to present the financial statements of WMI in accordance with generally accepted accounting principles; does not purport to present the market value of WMI’s assets and liabilities or the recoverability of WMI’s assets; is in a format prescribed by applicable bankruptcy laws; and is subject to future adjustment and reconciliation. There can be no assurance that, from the perspective of an investor or potential investor in WMI’s securities, the Monthly Operating Report is complete. Results set forth in the Monthly Operating Report should not be viewed as indicative of future results. This disclaimer applies to all information contained herein.

 

On September 26, 2008 (the “Petition Date”), the Debtors each commenced voluntary cases under chapter 11 of title 11 of the United States Code with the United States Bankruptcy Court for the District of Delaware. Prior to the Petition Date, on September 25, 2008, the Director of the Office of Thrift Supervision, appointed the Federal Deposit Insurance Corporation (the “FDIC”) as receiver for Washington Mutual Bank (“WMB”) and advised that the receiver was immediately taking possession of WMB. Immediately after its appointment as receiver, the FDIC sold substantially all the assets of WMB, including the stock of Washington Mutual Bank fsb, to JPMorgan Chase Bank, National Association (“JPMorgan”) pursuant to that certain Purchase and Assumption Agreement, Whole Bank, dated as of September 25, 2008 (the “Sale”).

 

Prior to the Petition Date, WMI and WMB jointly maintained their respective financial records. As a result of the Sale, many of the Debtors’ books and records were seized by the FDIC and transferred to the custody of JPMorgan. Accordingly, the Debtors are not in control of certain information relating to their operations and financial affairs, including, but not limited to, certain accounting information. In addition, as of the date of the Sale, substantially all of WMB’s employees became employees of JPMorgan. Accordingly, this Monthly Operating Report was prepared, in part, based upon the information and work product and/or representations made available to the Debtors and their professionals by representatives of WMB and JPMorgan.

 

Results represented in this Monthly Operating Report are consistent with WMI’s accounting practices as of the Petition Date. However, records of prepetition assets and liabilities, including, among other things, liabilities owed by WMI to WMB and its affiliates are likely to be adjusted. The Debtors reserve all rights to amend the results represented in this Monthly Operating Report.

 

                                                                                                

                                                                                                

 


Washington Mutual, Inc., et al

Case No. 08-12229 (MFW)

August 2009 Monthly Operating Report -- UNAUDITED

 

MOR 1 -- Schedule of Cash Receipts and Disbursements

 

 

 

Washington Mutual, Inc.

 

WMI Investment Corp.

 

Account

Deposit

Deposit

Deposit

Deposit

Money Market

General

 

Deposit

General

 

 

Bank

WMB/JPM

WMB/JPM

WMB/JPM

WMB/JPM

Bank of America

Bank of America

 

WMB/JPM

Bank of America

 

 

Bank Account

xxx0667

xxx4234

xxx9626

xxx9663

xxx0658

xxx4228

WMI

xxx4704

xxx4231

WMI Inv Corp

Combined

GL Account

70 /10450

70 / 10441

70 / 10451

70 / 10452

70 / 12510

70 /10305

Total

467 / 10450

467 / 10305

Total

Total

 

 

 

 

 

 

 

 

 

 

 

 

Opening Balance - 07/31/2009

261,693,638

3,673,083,998

4,657

748,814

21,235,103

3,703,630

3,960,469,840

53,561,191

3,605,019

57,166,210

4,017,636,050

 

 

 

 

 

 

 

 

 

 

 

 

Receipts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest & investment returns

44,452

620,863

-

127

2,285

156

667,883

9,098

101,166

110,264

778,147

Tax refunds

 

 

 

 

 

-

-

 

 

-

-

Reimbursements/distributions from subs

 

 

 

 

 

-

-

 

 

-

-

Sales of assets/securities

 

 

 

 

 

3,175,347

3,175,347

 

 

-

3,175,347

Return of funds from debt trustee

 

 

 

 

 

-

-

 

 

-

-

Death benefit proceeds

 

 

 

 

 

-

-

 

 

 

-

Other miscellaneous receipts

 

 

 

 

 

-

-

 

 

-

-

Total Receipts

44,452

620,863

-

127

2,285

3,175,503

3,843,230

9,098

101,166

110,264

3,953,494

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transfers

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sweep to/(from) Money Market account

 

 

 

 

(8,000,000)

8,000,000

-

 

 

-

-

Sweep to Wells Managed Account

 

 

 

 

-

-

-

 

(3,550,000)

(3,550,000)

(3,550,000)

Total Transfers

-

-

-

-

(8,000,000)

8,000,000

-

-

(3,550,000)

(3,550,000)

(3,550,000)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Disbursements

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and benefits

 

 

 

 

 

352,383

352,383

-

-

-

352,383

Travel and other expenses

 

 

 

 

 

12,742

12,742

-

-

-

12,742

Occupancy and supplies

 

 

 

 

 

142,032

142,032

-

-

-

142,032

Professional fees

 

 

 

 

 

9,556,488

9,556,488

-

-

-

9,556,488

Other outside services

 

 

 

 

 

559,699

559,699

-

-

-

559,699

Bank fees

 

 

 

 

 

15,035

15,035

-

14

14

15,049

US Trustee quarterly Fees

 

 

 

 

 

-

-

-

-

-

-

Directors fees

 

 

 

 

 

65,000

65,000

-

-

-

65,000

Miscellaneous adjustments

 

 

 

 

 

-

-

-

-

-

-

Total Disbursements

-

-

-

-

 

10,703,378

10,703,378

-

14

14

10,703,392

 

 

 

 

 

 

 

 

 

 

 

 

Net Cash Flow

44,452

620,863

-

127

(7,997,715)

472,124

(6,860,149)

9,098

(3,448,848)

(3,439,750)

(10,299,898)

 

 

 

 

 

 

 

 

 

 

 

 

Cash - End of Month

261,738,090

3,673,704,861

4,657

748,941

13,237,388

4,175,754

3,953,609,691

53,570,289

156,171

53,726,460

4,007,336,152

 

 

 

 

 

 

 

 

 

 

 

 

GL Balance

261,738,090

3,673,704,861

4,657

748,942

13,237,388

4,175,754

3,953,609,691

53,570,289

156,171

53,726,460

4,007,336,151

 

 

 

 

 

 

 

 

 

 

 

 

Net value - short-term securities

 

 

 

 

 

 

647,600,367

 

 

220,921,318

868,521,686

 

 

 

 

 

 

 

 

 

 

 

 

Total Cash & Cash Equivalents

 

 

 

 

 

 

4,601,210,059

 

 

274,647,778

4,875,857,836

 

 


re Washington Mutual, Inc., et al

Case No. 08-12229 (MFW)

 

 

Washington Mutual, Inc., et al

Case No. 08-12229 (MFW)

August 2009 Monthly Operating Report -- UNAUDITED

MOR 1a and MOR 1c -- Cash

 

 

Bank Reconciliations

 

The above-captioned debtors (the "Debtors") hereby submit this attestation regarding bank account reconciliations in lieu of providing copies of bank statements and copies of all account reconciliations.

 

I attest that each of the Debtors' bank accounts is reconciled to monthly bank statements except that certain account ending in 4234 (the "Excluded Account"). The Debtors' standard practice is to ensure that each bank account is reconciled to monthly bank statements for each calendar month 30 days after month end.

 

Recently, JPMorgan Chase Bank, National Association (“JPM”) transitioned the Excluded Account from the WaMu deposit platform to the Chase deposit platform. Since the transition, JPM has not provided the Debtors with account statements related to the Excluded Account for each of May and June 2009. JPM has provided a statement dated August 14, 2009 that reconciles to the Debtors’ July 31, 2009 balance. The August 31 balance agrees with the August 14, 2009 statement balance. We know of no transactions since August 14, 2009, thus the August 31, 2009 balance agrees with the statement.

 

 

/s/ John Maciel

John Maciel

Chief Financial Officer

Washington Mutual, Inc.

 




 

 

 

Case No. 08-12229 (MFW)

Washington Mutual, Inc.

 

 

MOR-1B: Schedule of Professional Fees Paid

 

 

Month Ended August 31, 2009

 

 

 

 

 

 

 

Check

 

Amount Paid* - Aug'09

 

Amount Paid CTD

Payee

 

Period Covered

 

Number

 

Date

 

Fees

 

Expense

 

Fees

 

Expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Akin, Gump, Strauss, Hauer & Feld LLP

06/01/09 - 06/30/09

Wire

 

08/27/09

 

$ 470,451.00

 

$ 15,929.35

 

$ 5,611,587.65

 

$ 197,114.44

Alvarez & Marsal

06/01/09 - 07/31/09

Wires

 

08/06/09, 08/27/09

 

5,494,612.25

 

273,686.52

 

19,590,823.19

 

981,263.55

CONSOR Intellectual Asset Management

03/12/09 - 05/31/09

1727

 

08/27/09

 

41,593.20

 

-

 

207,966.00

 

3,249.00

CP Energy Group, LLC

02/03/09 - 05/31/09

1536, 1728

 

08/06/09, 08/27/09

 

39,285.71

 

63.88

 

39,285.71

 

63.88

Davis Wright Tremaine LLP

02/01/09 - 05/31/09

1706, 1729

 

08/13/09, 08/27/09

 

36,127.60

 

9.60

 

617,022.00

 

19,731.90

Elliott Greenleaf

04/01/09 - 06/30/09

1719, 1730

 

08/20/09, 08/27/09

 

56,486.40

 

1,801.27

 

102,249.60

 

4,586.04

FTI Consulting, Inc.

02/01/09 - 06/30/09

Wire

 

08/27/09

 

392,499.70

 

7,386.54

 

2,543,555.70

 

28,556.15

Gibson, Dunn & Crutcher LLP

02/01/09 - 05/31/09

Wire, 1731

 

08/06/09, 08/27/09

 

151,542.70

 

1,006.14

 

463,573.75

 

6,503.63

Grant Thornton

02/01/09 - 05/31/09

1537, 1732

 

08/06/09, 08/27/09

 

36,329.90

 

-

 

159,729.00

 

6,044.24

Joele Frank, Wilkinson Brimmer Katcher

 

 

 

 

 

-

 

-

 

91,072.50

 

5,689.86

John W. Wolfe, P.S.

02/02/09 - 06/30/09

1710, 1733

 

08/13/09, 08/27/09

 

87,266.80

 

314.50

 

345,705.20

 

557.00

Kurtzman Carson Consultants LLC

 

 

 

 

 

 

 

-

 

-

 

1,066,775.34

 

-

Miller & Chevalier Chartered

02/01/09 - 05/31/09

1544, 1737

 

08/06/09, 08/27/09

 

32,674.40

 

-

 

127,281.00

 

-

McKee Nelson LLP

02/01/09 - 05/31/09

Wires

 

08/06/09, 08/27/09

 

174,013.45

 

1,994.71

 

608,797.80

 

9,720.51

Milliman

 

 

 

 

 

 

 

-

 

-

 

29,697.49

 

-

Pepper Hamilton LLP

02/01/09 - 05/31/09

Wires

 

08/06/09, 08/27/09

 

165,198.80

 

4,052.75

 

1,228,320.92

 

60,250.20

Perkins Coie LLP

02/01/09 - 04/30/09

Wires

 

08/13/09, 08/27/09

 

192,333.40

 

2,424.95

 

912,334.75

 

19,338.72

PricewaterhouseCoopers LLP

01/29/09 - 05/31/09

Wire

 

08/06/09

 

637,581.20

 

77,011.49

 

637,581.20

 

77,011.49

Quinn Emanuel Urquhart Oliver & Hedges

04/03/09 - 05/31/09

Wire

 

08/27/09

 

942,823.60

 

12,281.80

 

1,625,468.00

 

30,037.11

Richards, Layton & Finger P.A.

02/01/09 - 05/31/09

Wires

 

08/06/09, 08/27/09

 

26,758.60

 

859.39

 

211,800.00

 

21,626.34

Shearman & Sterling LLP

02/01/09 - 05/31/09

1545, 1742

 

08/06/09, 08/27/09

 

47,806.30

 

1.38

 

639,143.00

 

16,701.58

Simpson Thacher & Bartlett LLP

01/01/09 - 05/31/09

Wire, 1743

 

08/06/09, 08/27/09

 

124,123.30

 

8,155.82

 

352,029.75

 

9,901.86

Towers, Perrin, Forster & Crosby, Inc.

 

 

 

 

 

 

 

-

 

-

 

80,901.43

 

-

Weil, Gotshal & Manges LLP

 

 

 

 

 

-

 

-

 

7,531,948.00

 

182,876.25

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

$9,149,508.31

 

$ 406,980.09

 

$44,824,648.98

 

$1,680,823.75

 

* Interim fee applications for the period 01/01/09 - 05/31/09 and multiple invoices were paid during this period.

 


 

 

 

Washington Mutual, Inc., et al

Case No. 08-12229 (MFW)

August 2009 Monthly Operating Report -- UNAUDITED

 

MOR 2 Statement of Operations for the period 8/1/09 to 8/31/09

 

 

 

Washington Mutual, Inc.

 

WMI Investment Corp.

 

August 2009

 

Cumulative to Date

 

August 2009

 

Cumulative to Date

Revenues:

 

 

 

 

 

 

 

Interest income:

 

 

 

 

 

 

 

Cash equivalents

770,929

 

9,686,084

 

50,930

 

448,123

Securities

273,565

 

2,834,133

 

-

 

2,976,201

Notes receivable - intercompany

46,341

 

885,809

 

-

 

1

Other

156

 

1,030,051

 

-

 

-

Total interest income

1,090,991

 

14,436,076

 

50,930

 

3,424,325

Earnings (losses) from subsidiaries and other equity investments

(1,301,825)

 

(212,538,647)

 

-

 

(23,722,803)

Gains (losses) from securities / investments

1,883,667

 

(10,632,557)

 

-

 

(112,354,077)

Other income

262,846

 

2,240,927

 

-

 

(0)

Total revenues

1,935,678

 

(206,494,201)

 

50,930

 

(132,652,555)

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

Compensation and benefits

323,994

 

4,417,899

 

-

 

-

Occupancy and equipment

91,992

 

927,519

 

-

 

-

Professional fees

1,736,370

 

5,482,949

 

-

 

148

Loss / (Income) from BOLI/COLI policies

(276,706)

 

(5,322,989)

 

-

 

-

Management fees / Transition services

150,755

 

1,995,781

 

-

 

-

Insurance

416,668

 

14,486,837

 

-

 

-

Other

148,875

 

1,096,534

 

11,478

 

380,174

Total operating expenses

2,591,946

 

23,084,530

 

11,478

 

380,323

 

 

 

 

 

 

 

 

Net profit (loss) before other income and expenses

(656,268)

 

(229,578,731)

 

39,452

 

(133,032,878)

 

 

 

 

 

 

 

 

Other income and expenses:

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

Notes payable - intercompany

-

 

-

 

-

 

-

Borrowings

-

 

-

 

-

 

-

Total interest expense

-

 

-

 

-

 

-

Other expense / (income)

-

 

(55,028,000)

 

-

 

-

 

 

 

 

 

 

 

 

Net profit (loss) before reorganization items

(656,268)

 

(174,550,731)

 

39,452

 

(133,032,878)

 

 

 

 

 

 

 

 

Reorganization items:

 

 

 

 

 

 

 

Professional fees

4,230,837

 

57,998,783

 

-

 

-

US Trustee quarterly fees

2,600

 

66,000

 

-

 

5,850

Gains (losses) from sale of assets

-

 

-

 

-

 

-

Other reorganization expenses

548,407

 

6,124,276

 

-

 

-

Total reorganization items

4,781,844

 

64,189,059

 

-

 

5,850

Net profit (loss) before income taxes

(5,438,113)

 

(238,739,790)

 

39,452

 

(133,038,728)

 

 

 

 

 

 

 

 

Income taxes

-

 

50

 

-

 

-

 

 

 

 

 

 

 

 

Net profit (loss)

(5,438,113)

 

(238,739,840)

 

39,452

 

(133,038,728)

 

 

 

 

 

 

 

 

Income tax rate

0.0%

 

0.0%

 

0.0%

 

0.0%

 

 

                                                                                                

 


Washington Mutual, Inc., et al

Case No. 08-12229 (MFW)

August 2009 Monthly Operating Report -- UNAUDITED

 

MOR 3 Balance Sheet as of 8/31/2009 and 9/26/2008

 

 

 

Washington Mutual, Inc.

 

WMI Investment Corp.

 

8/31/09

 

9/26/08

 

8/31/09

 

9/26/08

Assets:

 

 

 

 

 

 

 

Unrestricted cash and cash equivalents

4,601,210,059

 

4,018,083,009

 

274,647,778

 

52,974,376

Restricted cash and cash equivalents

94,362,666

 

145,668,884

 

-

 

-

Investment securities

70,236,588

 

59,688,627

 

-

 

266,444,881

Accrued interest receivable

890,913

 

413,253

 

4,077

 

4,084,658

Accounts receivable

-

 

-

 

-

 

-

Income tax receivable

477,979,473

 

742,680,150

 

22,187,560

 

22,187,560

Prepaid expenses

1,493,855

 

11,311,510

 

-

 

-

Cash surrender value of BOLI/COLI

88,277,052

 

84,039,738

 

-

 

-

Funded Pension

39,173,922

 

638,870,071

 

-

 

-

Other investments

-

 

23,668,909

 

40,614,205

 

65,952,708

Investment in subsidiaries

1,473,892,317

 

1,895,218,467

 

-

 

-

Notes receivable - intercompany

12,275,931

 

58,001,133

 

565,844,197

 

565,844,197

Fixed Assets

104,946

 

-

 

-

 

-

Other assets

80,130,874

 

23,489,277

 

-

 

-

Total assets

6,940,028,595

 

7,701,133,028

 

903,297,818

 

977,488,380

 

 

 

 

 

 

 

 

Liabilities not subject to compromise (Postpetition):

 

 

 

 

 

 

 

Accounts payable

6,026,611

 

-

 

-

 

-

Taxes payable

-

 

-

 

-

 

-

Accrued wages and benefits

884,450

 

-

 

-

 

-

Other accrued liabilities

12,538,837

 

-

 

15,725

 

-

Rent and equipment lease payable

-

 

-

 

-

 

-

Deferred tax liability / (asset)

-

 

-

 

-

 

-

Other Liabilities - Intercompany

-

 

-

 

-

 

-

Other post-petition liabilities

-

 

-

 

-

 

-

Minority interest

1,113,271

 

3,104,022

 

-

 

-

Total post-petition liabilities

20,563,168

 

3,104,022

 

15,725

 

-

 

 

 

 

 

 

 

 

Liabilities subject to compromise (Pre-petition):

 

 

 

 

 

 

 

Senior debt

4,108,911,139

 

4,108,911,139

 

-

 

-

Subordinated debt

1,613,991,512

 

1,613,991,512

 

-

 

-

Junior subordinated debt

742,476,453

 

742,476,453

 

 

 

 

Accrued interest payable

75,907,764

 

75,907,764

 

-

 

-

Intercompany payables

684,095,259

 

684,095,258

 

-

 

-

Accounts payable

4,480,720

 

3,941,450

 

-

 

-

Taxes payable

550,080,833

 

550,080,833

 

-

 

-

Payroll and benefit accruals

407,236,707

 

407,215,221

 

-

 

-

Other accrued liabilities

86,421,167

 

92,259,015

 

-

 

-

Other pre-petition liabilities

198

 

223

 

-

 

-

Total pre-petition liabilities

8,273,601,752

 

8,278,878,868

 

-

 

-

 

 

 

 

 

 

 

 

Total liabilities

8,294,164,921

 

8,281,982,890

 

15,725

 

-

 

 

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

 

Preferred stock

3,392,341,954

 

3,392,341,953

 

-

 

-

Common stock

12,988,753,556

 

12,988,753,556

 

1,000,000,000

 

1,000,000,000

Other comprehensive income

(754,687,214)

 

(222,770,180)

 

22,187,560

 

(36,644,880)

Retained earnings - pre-petition

(16,741,804,781)

 

(16,739,175,191)

 

14,133,260

 

14,133,260

Retained earnings - post-petition

(238,739,840)

 

-

 

(133,038,728)

 

-

Total shareholders' equity

(1,354,136,325)

 

(580,849,862)

 

903,282,093

 

977,488,380

 

 

 

 

 

 

 

 

Total liabilities and shareholder's equity

6,940,028,595

 

7,701,133,028

 

903,297,818

 

977,488,380

 


re Washington Mutual, Inc., et al

Case No. 08-12229 (MFW)

 

 

NOTES TO MOR-2 and MOR-3

Note 1: Washington Mutual Preferred Funding

 

On September 25, 2008, the Office of Thrift Supervision concluded that an “Exchange Event” had occurred with respect to the following securities (the “Securities”):

 

 

Washington Mutual Preferred (Cayman) I Ltd. 7.25% Perpetual Non-cumulative Preferred Securities, Series A-1 (to be exchanged into depositary shares representing Series J Perpetual Non-Cumulative Fixed Rate Preferred Stock of Washington Mutual, Inc. (“WMI”));

 

 

Washington Mutual Preferred (Cayman) I Ltd. 7.25% Perpetual Non-cumulative Preferred Securities, Series A-2 (to be exchanged into depositary shares representing Series J Perpetual Non-Cumulative Fixed Rate Preferred Stock of WMI);

 

 

Washington Mutual Preferred Funding Trust I Fixed-to-Floating Rate Perpetual Non-cumulative Trust Securities (to be exchanged into depositary shares representing Series I Perpetual Non-Cumulative Fixed-to-Floating Rate Preferred Stock of WMI);

 

 

Washington Mutual Preferred Funding Trust II Fixed-to-Floating Rate Perpetual Non-cumulative Trust Securities (to be exchanged into depositary shares representing Series L Perpetual Non-Cumulative Fixed Rate Preferred Stock of WMI);

 

 

Washington Mutual Preferred Funding Trust III Fixed-to-Floating Rate Perpetual Non-cumulative Trust Securities (to be exchanged into depositary shares representing Series M Perpetual Non-Cumulative Fixed Rate Preferred Stock of WMI); and

 

 

Washington Mutual Preferred Funding Trust IV Fixed-to-Floating Rate Perpetual Non-cumulative Trust Securities (to be exchanged into depositary shares representing Series N Perpetual Non-Cumulative Fixed-to-Floating Rate Preferred Stock of WMI).

 

In accordance with the terms of the documents governing the Securities, the Conditional Exchange of the Securities occurred on Friday, September 26, 2008 at 8:00 A.M. (New York time). The documentation governing the Securities contemplates that at the time of the Conditional Exchange, each outstanding Security was intended to be exchanged automatically for a like amount of newly issued Fixed Rate Depositary Shares or newly issued Fixed-to-Floating Rate Depositary Shares, as applicable, each representing a 1/1000th interest in one share of the applicable series of preferred stock of WMI. If and until such depositary receipts are delivered or in the event such depositary receipts are not delivered, any certificates previously representing Securities are deemed for all purposes, effective as of 8:00 AM (New York time) on September 26, 2008, to represent Fixed Rate Depositary Shares or Fixed-to-Floating Rate Depositary Shares, as applicable.

 

WMI and its advisors are currently assessing a number of legal, accounting and tax issues related to the Securities and the transactions related to the Conditional Exchange. Because of these unresolved issues, WMI has not yet reflected the Conditional Exchange and/or its attendant transactions on its financial statements, including any possible interests (direct or indirect, contingent or otherwise) in the Securities and the assets, as the case may be, of Washington Mutual Preferred Funding LLC.

 

Assuming that the Conditional Exchange had been completed in accordance with the terms of the relevant documentation, on a pro forma basis, WMI’s financial statements would reflect (a) a credit to shareholders’ equity of approximately $3.9 billion upon issuance of the new classes of preferred stock; (b) an investment in subsidiary (i.e. WMB) of approximately $3.9 billion upon contribution of the Preferred Securities by WMI to WMB; and (c) an immediate and corresponding write-down of such investment in subsidiary.

 

                                                                                                

 


Note 2: Restricted Cash and Cash Equivalents

 

WMI’s restricted cash and cash equivalents of $94 million includes $40 million of accumulated dividends related to amounts held in escrow pertaining to that certain action styled as American Savings Bank, F.A et al. v United States, Case No 92-872C pending in the United States Court of Federal Claims, $53 million in a deposit account pledged as collateral to secure prepetition intercompany transactions between WMI and WMB and $1 million held as part of a Rabbi Trust.

 

Note 3: Investment in Subsidiaries

 

WMI’s investment in subsidiaries represents the book value of WMI’s subsidiaries, including WMI Investment Corp. (“WMI Investment”). This balance does not represent the market value of these entities.

 

WMI subsidiaries hold unsecured notes receivable from WMB or JPMorgan, as the case may be, totaling approximately $179 million.

 

Note 4: Funded Pension

 

The funded pension balance reflects the (1) the market value of assets as of December 2, 2008 less (2) the November 2008 actuarial estimated settlement value of September 25, 2008 liabilities. The value does not reflect any recent changes in market values, interest rate assumptions and the participants since November 2008 which could materially affect the results.

 

Note 5: Taxes

 

The tax asset and liability balances are recorded consistent with WMI’s historical accounting practices as of the Petition Date and adjusted for refunds collected. Generally, tax related claims and payables are recorded on `WMI’s books and records on a consolidated basis with the other members of the consolidated tax group and have not been adjusted for any potential claims against these assets. The current recorded balances do not reflect all expected refunds or payments as these amounts are currently being reviewed. The current estimate for the total expected refunds, net of potential payments, is in the range of approximately $2.6 - $3.0 billion. WMI understands that JPMorgan, the purchaser of substantially all of WMB’s assets, may seek to claim all or a portion of the expected tax refunds.

 

No provision or benefit from income taxes has been recorded as the NOL’s are expected to be sufficient to offset income during the reported period. Income tax expense contains alternative minimum taxes paid in certain states.

 

 

Note 6: Liabilities Subject to Compromise (Pre-Petition) – Payroll and benefit accruals

 

WMI’s pre-petition payroll and benefit accruals include balances reflecting WMI’s historic accounting policies related to pension accounting. Prior to the Petition Date, WMI recorded a $274 million liability in respect of such accruals and WMB recorded a $274 million asset, which amounts were netted out and eliminated on a consolidated basis. Neither balance was reported as an intercompany balance. WMI is analyzing these accounting entries and treatment within the context of its bankruptcy proceedings.

 


 

 

Washington Mutual, Inc. / WMI Investment Corp.

Case No. 08-12229 (MFW)

August 2009 Monthly Operating Report -- UNAUDITED

 

MOR 4 Status of Postpetition Taxes

 

 

 

 

 

Washington Mutual, Inc.

 

WMI Investment Corp

 

 

 

 

Beginning Tax Liability

Amt approved for pmt

Taxes collected

Taxes remitted

Closing Balance Post Petition

Beginning Tax Liability

Amt approved for pmt

Taxes collected

Taxes remitted

Closing Balance Post Petition

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal

NOTES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Withholding

 

 

30,223.00

 

61,287.00

(91,510.00)

-

 

 

 

 

-

FICA -- Employee

 

 

4,964.68

 

9,462.53

(14,427.21)

-

 

 

 

 

-

FICA -- Employer

 

 

4,964.68

9,462.53

 

(14,427.21)

-

 

 

 

 

-

Unemployment

 

 

112.00

70.66

 

 

182.66

 

 

 

 

-

Income

**

 

 

 

 

 

-

 

 

 

 

-

Other:

 

 

 

 

 

 

-

 

 

 

 

-

Total Federal

 

 

40,264.36

9,533.19

70,749.53

(120,364.42)

182.66

-

-

-

-

-

 

 

 

 

 

 

 

 

 

 

 

 

 

State and Local

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Withholding

n/a

 

 

 

 

 

 

 

 

 

 

 

Sales

***

 

 

 

 

 

-

 

 

 

 

 

Unemployment

 

 

254.72

209.77

 

 

464.49

 

 

 

 

 

Disability

 

 

396.27

244.32

162.39

 

802.98

 

 

 

 

 

Real Property

n/a

 

 

 

 

 

-

 

 

 

 

 

Personal Property

n/a

 

 

 

 

 

-

 

 

 

 

 

Other

 

 

858.81

887.44

 

 

1,746.25

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total State and Local

 

 

1,509.80

1,341.53

162.39

-

3,013.72

-

-

-

-

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Taxes

 

 

41,774.16

10,874.72

70,911.92

(120,364.42)

3,196.38

-

-

-

-

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES

 

** WMI has booked no federal income tax on its post-petition income tax provision, nor has it made any federal payments. WMI has booked $50.00 of state income tax on its post-petition income tax provision for its 2008 Arizona corporate income tax extension payment that was paid in April 2009.

*** WMI does not have any Washington or City of Seattle sales/use tax liability for the month of August.

 

 

I attest that all tax returns have been filed in accordance with federal / state / county / city requirements for the above period.

 

 

/s/  John Maciel

John Maciel

Chief Financial Officer

Washington Mutual, Inc., et al

 




 

 

Washington Mutual, Inc. and WMI Investment Corp.

 

 

Tax Return Filings

 

 

 

For the Period 8/01/2009 through 8/31/2009

 

 

 

 

 

 

 

Property Tax Filings:

 

 

 

 

 

 

 

 

No property tax returns were filed during the period 8/01/2009 through 8/31/2009.

 

 

 

 

 

 

 

 

 

 

 

 

Sales/Use Tax Filings:

 

 

 

 

 

 

 

 

No sales/use tax returns were filed during the period 8/01/2009 through 8/31/2009.

 

 

 

 

 

 

 

 

 

 

 

 

Payroll Tax Filings:

 

 

 

 

 

 

 

 

Entity

Jurisdiction

Filing Description

Due Date

Date Filed

WMI

IRS (Federal)

Withholding summary of deposits and filings (semi-weekly)

8/05/2009

8/05/2009

WMI

IRS (Federal)

Withholding summary of deposits and filings (semi-weekly)

8/19/2009

8/19/2009

WMI

IRS (Federal)

Withholding summary of deposits and filings (semi-weekly)

9/04/2009

8/31/2009

 

 

 

 

 

 

 

 

 

 

Corporate Income Tax/Franchise Tax/Gross Receipts Tax Filings:

 

 

 

 

 

 

 

Entity

Jurisdiction

Filing Description

Due Date

Date Filed

 

 

 

 

 

No corporate income tax/franchise tax/gross receipts tax returns were filed during the period 8/01/2009 through 8/31/2009.

 

 

 

  

 




 

 

 

 

Case No. 08-12229 (MFW)

 

Washington Mutual, Inc.

 

 

MOR-4: Post Petition Accounts Payable Aging by Vendor

 

 

As of August 31, 2009

 

 

 

Vendor

 

Current *

 

31 - 60

 

61- 90

 

91 and Over

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Akin, Gump, Strauss, Hauer & Feld LLP

 

$597,002.35

 

$ -

 

$ -

 

$ -

 

$597,002.35

 

AT&T

 

3,683.08

 

-

 

-

 

-

 

3,683.08

 

Carl, Carl

 

280.00

 

-

 

-

 

-

 

280.00

 

CONSOR Intellectual Asset Management

 

59,190.00

 

-

 

-

 

-

 

59,190.00

 

CP Energy Group, LLC

 

20,064.91

 

-

 

-

 

-

 

20,064.91

 

Davis Wright Tremaine LLP

 

24,334.50

 

-

 

-

 

-

 

24,334.50

 

Depository Trust Company

 

1,472.00

 

-

 

-

 

-

 

1,472.00

 

Elliott Greenleaf

 

11,261.40

 

-

 

-

 

-

 

11,261.40

 

FTI Consulting, Inc.

 

50,939.30

 

-

 

-

 

-

 

50,939.30

 

Gibson, Dunn & Crutcher LLP

 

62,869.32

 

-

 

-

 

-

 

62,869.32

 

Grant Thornton

 

99,550.94

 

-

 

-

 

-

 

99,550.94

 

Grayson, Helen

 

110.40

 

-

 

-

 

-

 

110.40

**

Intralinks

 

(1,300.00)

 

-

 

-

 

-

 

(1,300.00)

 

Joele Frank, Wilkinson Brimmer Katcher

 

8,146.55

 

-

 

-

 

-

 

8,146.55

 

John W. Wolfe, P.S.

 

11,930.80

 

-

 

-

 

-

 

11,930.80

 

Kurtzman Carson Consultants LLC

 

63,114.78

 

-

 

-

 

-

 

63,114.78

 

Logan, Doreen

 

2,289.49

 

-

 

-

 

-

 

2,289.49

 

Mark Monitor, Inc.

 

12,900.00

 

-

 

-

 

-

 

12,900.00

 

McKee Nelson LLP / Bingham McCutchen LLP

 

298,634.56

 

-

 

-

 

-

 

298,634.56

 

Miller & Chevalier Chartered

 

18,244.50

 

-

 

-

 

-

 

18,244.50

 

Palsha, Jane

 

48.54

 

-

 

-

 

-

 

48.54

 

Pepper Hamilton LLP

 

115,718.15

 

-

 

-

 

-

 

115,718.15

 

Perkins Coie LLP

 

129,671.87

 

-

 

-

 

-

 

129,671.87

 

PricewaterhouseCoopers LLP

 

409,312.27

 

-

 

-

 

-

 

409,312.27

 

Richards, Layton & Finger P.A.

 

23,875.43

 

-

 

-

 

-

 

23,875.43

 

Shearman & Sterling LLP

 

63,604.92

 

-

 

-

 

-

 

63,604.92

 

Smith, Charles E.

 

14,255.21

 

-

 

-

 

-

 

14,255.21

 

Suzuki, Dennis

 

110.78

 

-

 

-

 

-

 

110.78

 

Weil, Gotshal & Manges LLP

 

3,921,518.96

 

-

 

-

 

-

 

3,921,518.96

 

Williams, Robert J.

 

3,775.95

 

-

 

-

 

-

 

3,775.95

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$6,026,610.96

 

$ -

 

$ -

 

$ -

 

$6,026,610.96

 

NOTES

*Any holdback of professional fees, pursuant to professionals' fee applications, are included in “Current.”

** Unapplied credit.

 

 

 

DEBTOR QUESTIONNAIRE

Must be completed each month

Yes

No

1.  Have any assets been sold or transferred outside the normal course of business
this reporting period? If yes, provide an explanation below.

X

 

2.  Have any funds been disbursed from any account other than a debtor in possession
account this reporting period? If yes, provide an explanation below.

X

 

3.  Have all postpetition tax returns been timely filed? If no, provide an explanation
below.

X

 

4.  Are workers compensation, general liability and other necessary insurance
coverages in effect? If no, provide an explanation below.

X

 

5.  Has any bank account been opened during the reporting period? If yes, provide
documentation identifying the opened account(s). If an investment account has been opened provide the required documentation pursuant to the Delaware Local Rule 4001-3.

 

X

 

 

Explanations

 

1.

On June 14, 2009, Wavelink Corporation was acquired by Wavelink Holdings Corp. Pursuant to the terms of the Agreement and Plan of Merger, Wavelink securities held by Washington Mutual, Inc. were converted into the right to receive $3.175 million in cash and a beneficial interest in note in the amount of $807,342.83. On August 12, 2009 WMI received the cash and an interest in the promissory note pertaining to this transaction.

 

2.

Pursuant to an order of the Bankruptcy Court dated October 8, 2008, the Debtors were authorized to continue using existing bank accounts and to open new debtor in possession bank accounts.