Initial Stock and Warrant Distributions
NorthWestern Corporation emerged on November 1, 2004 from a Chapter 11 bankruptcy reorganization. As a result of the reorganization, our common stock issued prior to emergence from bankruptcy was cancelled and has no value. Our unsecured bonds and trust preferred securities were cancelled and holders received distributions as follows:
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Class 7 - Unsecured Bondholders
(PDF)
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Class 8(a) - NorthWestern Trust Preferred Securities
(PDF)
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Class 8(b) Option 1 - Montana Power QUIPs
(PDF)
- Class 8(b) Option 2 - Montana Power QUIPs:
On December 16, 2008, a cash distribution at a rate of $3.6734242 per share was made to all outstanding QUIPS holders as of July 30, 2008. This payment represents certain amounts held back by Law Debenture from the original Option 1 distribution made in February 2006 and the proceeds to the Option 2 holders from the settlement of the litigation as described below. This will be the final distribution to the QUIPS holders.
On July 10, 2008, the U.S. Bankruptcy Court for the District of Delaware approved a settlement agreement by and among, inter alia, NorthWestern, Magten Asset Management (“Magten"), Law Debenture Trust Company of New York (“Law Debenture”) and the Plan Committee that resolved the litigation related to claims of holders of quarterly income preferred securities (the “QUIPS”) in NorthWestern's Chapter 11 bankruptcy case. Under the settlement agreement, Magten, Law Debenture and the holders of the QUIPS, collectively received a cash payment of $23 million to be allocated amongst them in accordance with the terms of the settlement agreement. The cash payment was funded principally by NorthWestern’s repurchase of stock held in the disputed claims reserve established under NorthWestern’s confirmed Plan of Reorganization (the “Plan”).
Final Distribution to Unsecured Creditors and Debt Holders
On October 30, 2009, a supplemental distribution was made of all of the remaining assets in the Disputed Claims Reserve on a pro rata basis to unsecured creditors and debt holders in Class 7 and Class 9 under the Plan, other than the holders of the QUIPS. This is the last and final distribution that will be made under the Plan. The rates for the Class 7 distributions are detailed in the following document.
Cost Basis Information for Those Receiving an Initial Distribution of Stock and Warrants
The value at emergence of NorthWestern's new common stock and warrants is as follows. The percentage of each component to the total value received may be applied to the cost basis of the original security to derive the cost basis for each component of the distribution.
| | Value at Emergence* |
| New Common Stock | $20.00 per share |
| Warrants | $0.71 per warrant |
Notices of Stock and Securities Cancellation
Warrant Agreement**
*The value at emergence of the new common stock is indicated in the Second Amended Plan of Reorganization as confirmed by the Bankruptcy Court. The total value at emergence of the 5,304,598 warrants issued is $3,782,467. This valuation was established in testimony presented during the bankruptcy proceedings.
**The Warrants expired on November 1, 2007, per the Warrant Agreement, and no longer have any value.