WMIH Corp. Reports 2017 Annual Financial Results

SEATTLE, March 1, 2018 — WMIH Corp. (Nasdaq: WMIH) (the “Company”) today reported financial
results for the year ended December 31, 2017.

In 2017, the Company reported a net operating loss of $2.5 million on revenues of $7.9 million and operating expenses of $10.4 million. Net income before taxes and dividends was $25.9 million primarily as a result of $28.2 million of other income resulting from a gain on change in value of the derivative embedded conversion feature recorded by the Company in relation to its Series B Convertible Preferred Stock. Net income attributable to common and participating stockholders was $7.8 million after $18.1 million of preferred stock dividends.

Bill Gallagher, the Company’s Chief Executive Officer, said, “In February 2018, following our successful efforts to amend and extend the mandatory redemption date of our Series B Convertible Preferred Stock, we executed definitive documentation to merge with Nationstar Mortgage Holdings Inc. (NYSE: NSM). We are very excited about this accretive combination, which we believe will significantly benefit and deliver value to our stockholders given the synergies between the WMIH platform and financial attributes and Nationstar’s experienced management team and best-in-class servicing and originations platform. We are working closely with the Nationstar team to successfully complete the merger in the second half of 2018.”

As of December 31, 2017, WMIH had approximately $578.9 million of restricted cash held in escrow, which represents the net proceeds of the Series B Preferred Convertible Stock issuance, net of fees and expenses paid in pursuit of acquisitions. The funds held in escrow are only available for Acquisitions and Qualified Acquisitions (as defined in WMIH’s Amended and Restated Certificate of Incorporation). Additionally, WMIH had $28.9 million of unrestricted cash available for general corporate purposes as of year-end.

IMPORTANT ADDITIONAL INFORMATION AND WHERE TO FIND IT

This communication is being made in respect of the proposed merger transaction involving WMIH and Nationstar. WMIH intends to file a registration statement on Form S-4 with the SEC, which will include a joint proxy statement of WMIH and Nationstar and a prospectus of WMIH, and each party will file other documents regarding the proposed transaction with the SEC. Any definitive proxy statement(s)/prospectus(es) will also be sent to the stockholders of WMIH and/or Nationstar, as applicable, seeking any required stockholder approval. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. Before making any voting or investment decision, investors and security holders of WMIH and Nationstar are urged to carefully read the entire registration statement(s) and proxy statement(s)/prospectus(es), when they become available, and any other relevant documents filed with the SEC, as well as any amendments or supplements to these documents, because they will contain important information about the proposed transaction. The documents filed by WMIH and Nationstar with the SEC may be obtained free of charge at the SEC’s website at www.sec.gov. In addition, the documents filed by WMIH may be obtained free of charge from WMIH at www.wmih-corp.com, and the documents filed by Nationstar may be obtained free of charge from Nationstar at www.nationstarholdings.com. Alternatively, these documents, when available, can be obtained free of charge from WMIH upon written request to WMIH Corp., 800 Fifth Avenue, Suite 4100, Seattle, Washington 98104, Attn: Secretary, or by calling (206) 922-2957, or from Nationstar upon written request to Nationstar Mortgage Holdings Inc., 8950 Cypress Waters Blvd, Dallas, TX 75019, Attention: Corporate Secretary, or by calling (469) 549-2000.

WMIH and Nationstar and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders of WMIH and/or Nationstar, as applicable, in favor of the approval of the merger. Information regarding WMIH’s directors and executive officers is contained in WMIH’s Annual Report on Form 10-K for the year ended December 31, 2016, its Quarterly Report on Form 10-Q for the quarterly periods ended March 31, 2017, June 30, 2017 and September 30, 2017 and its Proxy Statement on Schedule 14A, dated April 18, 2017, which are filed with the SEC. Information regarding Nationstar’s directors and executive officers is contained in Nationstar’s Annual Report on Form 10-K for the year ended December 31, 2016, its Quarterly Report on Form 10-Q for the quarterly periods ended March 31, 2017, June 30, 2017 and September 30, 2017, and its Proxy Statement on Schedule 14A, dated April 11, 2017, which are filed with the SEC. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the registration statement(s) and the proxy statement(s)/prospectus(es) and other relevant documents filed with the SEC when they become available. Free copies of these documents may be obtained as described in the preceding paragraph.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including, but not limited to, WMIH’s and Nationstar’s expectations or predictions of future financial or business performance or conditions. All statements other than statements of historical or current fact included in this press release that address activities, events, conditions or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business and these statements are not guarantees of future performance. Forward-looking statements may include the words “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “strategy,” “future,” “opportunity,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Such forward-looking statements involve risks and uncertainties that may cause actual events, results or performance to differ materially from those indicated by such statements. Certain of these risks are identified and discussed in WMIH’s Form 10-K for the year ended December 31, 2016 under Risk Factors in Part I, Item 1A and Nationstar’s Form 10-K for the year ended December 31, 2016 under Risk Factors in Part I, Item 1A. These risk factors will be important to consider in determining future results and should be reviewed in their entirety. These forward-looking statements are expressed in good faith, and WMIH and Nationstar believe there is a reasonable basis for them. However, there can be no assurance that the events, results or trends identified in these forward-looking statements will occur or be achieved. Forward-looking statements speak only as of the date they are made, and neither WMIH nor Nationstar is under any obligation, and expressly disclaim any obligation, to update, alter or otherwise revise any forward-looking statement, except as required by law. Readers should carefully review the statements set forth in the reports, which WMIH and Nationstar have filed or will file from time to time with the SEC.

In addition to factors previously disclosed in WMIH’s and Nationstar’s reports filed with the SEC and those identified elsewhere in this press release, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: ability to meet the closing conditions to the merger, including approval by shareholders of WMIH and Nationstar on the expected terms and schedule and the risk that regulatory approvals required for the merger are not obtained or are obtained subject to conditions that are not anticipated; delay in closing the merger; failure to realize the benefits expected from the proposed transaction; the effects of pending and future legislation; risks associated with investing in mortgage loans and mortgage servicing rights and changes in interest rates; risks related to disruption of management time from ongoing business operations due to

the proposed transaction; business disruption following the transaction; macroeconomic factors beyond WMIH’s or Nationstar’s control; risks related to WMIH’s or Nationstar’s indebtedness and other consequences associated with mergers, acquisitions and divestitures and legislative and regulatory actions and reforms.

CONTACT
Helen Grayson
206-922-2957

Financial
Tables

WMIH
CORP. AND SUBSIDIARIES

CONSOLIDATED
STATEMENTS OF OPERATIONS

(in
thousands, except share and per share data)

Year
ended

December 31,
2017



Year
ended

December 31,
2016



Year
ended

December 31,
2015


Revenues:












Premiums
earned

$

1,220



$

3,147



$

5,121


Net
investment income


6,670




2,249




879


Total
revenues


7,890




5,396




6,000


Operating
expenses:












Losses
and loss adjustment expense (benefit)


19




(669

)



(1,115

)

Ceding
commission expense


137




306




456


General
and administrative expense


14,457




7,043




20,940


Loss
contract reserve reduction


(5,645

)



(3,978

)



(2,926

)

Gain
from contract termination


(383

)







Interest
expense


1,788




2,616




3,702


Total
operating expenses


10,373




5,318




21,057


Net
operating (loss) income


(2,483

)



78




(15,057

)

Other
(income) expense:












Other
income


(123

)



(123

)



(7,845

)

(Gain)
Loss on change in fair value of derivative embedded conversion
feature


(28,242

)



(201,499

)



54,621


Total
other (income) expense


(28,365

)



(201,622

)



46,776


Income
(Loss) before income taxes


25,882




201,700




(61,833

)

Income
tax expense (benefit)









Net
income (loss)


25,882




201,700




(61,833

)

Redeemable
convertible series B preferred stock dividends


(18,050

)



(18,000

)



(17,748

)

Net
income (loss) attributable to common and participating
stockholders

$

7,832



$

183,700



$

(79,581

)

Basic
net income (loss) per share attributable to common stockholders
(Note 12)

$

0.01



$

0.33



$

(0.39

)

Shares
used in computing basic net income (loss) per share


202,595,288




202,270,887




201,746,613


Diluted
net income (loss) per share attributable to common stockholders
(Note 12)

$

0.01



$

0.30



$

(0.39

)

Shares
used in computing diluted net income (loss) per share


212,660,917




235,406,360




201,746,613


December 31,
2017



December 31,
2016


ASSETS:








Investments
held in trust:








Fixed-maturity
securities

$

1,518



$

29,206


Cash
equivalents held in trust


4,199




2,176


Total
investments held in trust


5,717




31,382


Cash
and cash equivalents


26,709




2,491


Fixed-maturity
securities


2,142




47,625


Restricted
cash


578,936




573,347


Derivative
asset – embedded conversion feature





80,651


Accrued
investment income


59




187


Other
assets


558




507


Total
assets

$

614,121



$

736,190


LIABILITIES,
R
EDEEMABLE
CONVERTIBLE
PREFERRED
STOCK
AND
S
TOCKHOLDERS’
EQUITY






Liabilities:






Notes
payable – principal

$



$

18,774


Notes
payable – interest





203


Losses
and loss adjustment reserves


474




811


Losses
payable





53


Unearned
premiums


39




270


Accrued
ceding commissions





22


Loss
contract reserve





5,645


Other
liabilities


16,303




14,063


Total
liabilities


16,816




39,841


Commitments
and contingencies






Redeemable
convertible series B preferred stock, $0.00001 par value; 600,000
shares issued and outstanding as of December 31, 2017 and
December 31, 2016; aggregate liquidation preference of
$600,000,000 as of December 31, 2017 and December 31, 2016


503,713




502,213


Stockholders’
equity:






Convertible
series A preferred stock, $0.00001 par value; 1,000,000 shares
issued and outstanding as of December 31, 2017 and
December 31, 2016; aggregate liquidation preference of $10
as of December 31, 2017 and December 31, 2016






Common
stock, $0.00001 par value; 3,500,000,000 authorized; 206,714,132
and 206,380,800 shares issued and outstanding as of December 31,
2017 and December 31, 2016, respectively


2




2


Additional
paid-in capital


39




108,415


Retained
earnings


93,551




85,719


Total
stockholders’ equity


93,592




194,136


Total
liabilities, redeemable convertible preferred stock and
stockholders’ equity

$

614,121



$

736,190