OMNIWOOD CLASS ACTION SETTLEMENT INFORMATION

FROM THE CIRCUIT COURT OF MOBILE COUNTY, ALABAMA JEFF COSBY, et al., Plaintiffs vs. MASONITE CORPORATION, et al., Defendants., CIVIL ACTION NO. CV-98-2446

What is Masonite OmniWood Siding?

Masonite was a leading manufacturer of an oriented strandboard siding product made from wood fiber, wax, resins, and a hardboard overlay that is widely known as OmniWood siding. Masonite OmniWood siding was distributed both in lap (board) and panel (sheet) applications, each available in various external textures designed to look like conventional lumber siding. Masonite marketed OmniWood siding products for a variety of external construction uses, including exterior siding for residential and other structures.

How do I know if I have Masonite OmniWood Siding?

If you do not already know whether you have Masonite OmniWood Siding on your property, there are several steps you may take to make that determination. You may wish to contact the builder of your property; you may remove a board or sheet of the siding and inspect the reverse side; or, if you have a garage with the back side of the siding exposed, you may look there. Masonite OmniWood siding is typically identified by the size of the fiber overlays on the back of the siding. Masonite OmniWood Siding has fine, toothpick-size fiber overlays as opposed to the much thicker thumb-size fiber overlays found on the back of other manufacturers' oriented strandboard siding products. You may also take a piece of your siding to your local building supply store, which may be able to assist you. As part of the claims process, you will be required to establish that you have Masonite OmniWood Siding on your property.

Eligible Claimants

If you qualify as an Eligible Claimant, you may be entitled to recover under the proposed Settlement Agreement. To be an Eligible Claimant, you must:

(1) own property in the United States or its territories in which Masonite OmniWood Siding manufactured since January 1, 1992 is incorporated and installed, and have not assigned the claim regarding the alleged damage caused by Masonite OmniWood Siding;

(2) be a subsequent purchaser of such property and have properly documented assignments determined to be valid under the Settlement Agreement

Eligible Claimants do not include persons, associations or entities who made claims or filed lawsuits against Defendants other than in the Cosby class action, were represented by counsel other than Plaintiffs' Class Counsel in the Cosby class action, and whose claims or lawsuits were resolved by full payment, release, dismissal with prejudice, or judicial action.

Compensation Formula Basic Formula.

The proposed Settlement Agreement contains a Compensation Formula, which will be the measure of payments to which an Eligible Claimant is entitled for the damage to a home or other structure. As agreed by the parties, the Compensation Formula will be based on (1) the average cost per square foot for siding replacement, including all material and labor as calculated by industry standards in your area, adjusted annually for inflation, or (2) the cost of appropriate refinishing as determined by industry standards in your area, also adjusted for inflation.
If more than 40% of a wall section is found to have compensable damage, then an Eligible Claimant will receive compensation, determined by the Compensation Formula, for that entire wall section. If 60% of the siding square footage of the structure qualifies as damaged, then an Eligible Claimant will receive compensation, as determined by the Compensation Formula, for the entire structure.

Definition of Damage.

To be entitled to payment under the Settlement, an Eligible Claimant must be determined to have compensable Damage as defined by the Settlement Agreement. In summary terms, the Settlement Agreement defines Damage as follows: (1) thickness swell exceeding .520"; (2) edge checking wherein a gauge can be inserted one half inch into the board; (3) fungal degradation which results in soft board in which thumb pressure exhibits sponginess in the board deforming or producing significant indentation; (4) buckling exceeding of 1/4" between studs placed not more than 18" on center; (5) wax bleed; (6) delaminated or cracked primer or primer peel or peeling, or blistering; (7) surface welting, or swelling around nailheads; (8) moisture content exceeding 20%; or (9) raised or popped wafers visible on more than 25% of the surface of a board. Damage does not include: (1) intentional, reckless or negligent damage to siding (unrelated to installation or maintenance); or (2) damage to siding to the extent resulting from natural disaster including, but not limited to, fire, hurricane, flood, earthquake, earth movement or other similar events (excluding hail).

Causation Exceptions.

An Eligible Claimant with compensable Damage as defined above will be entitled to recovery unless one or more of the Causation Exceptions contained in the Settlement Agreement is determined to apply. The Causation Exceptions include damage caused by: (1) framing misalignment; (2) studs spaced more than 18 inches on center; (3) missing nails or nails which do not appear to penetrate framing members; (4) permanently installed sprinkler systems having directly sprayed the affected area; (5) siding within two inches of the ground; (6) the absence of or improper roof/wall flashing or cutbacks; (7) the failure of a chimney cricket to extend to the edge of the chimney; or (8) damage around a window assembly. For a Causation Exception to apply, the condition giving rise to the Exception must be clearly observable to the Independent Inspector without intrusive testing and must be determined to be the sole, independent cause of the damage. The benefit of any doubt will go to the homeowner. In addition, an Eligible Claimant will be compensated under the Compensation Formula for all damage to a particular board if any part of such damage is determined to be a result of product failure.

Discontinued Masonite OmniWood Siding Products for Which There Are No Reasonable Substitutes.

As of the date of the Settlement Agreement (July, 1998), Masonite has discontinued the manufacture of all OmniWood siding products. For certain products, specifically OmniWood Pine Textured 8" Lap, there are no substitutes that are reasonably similar in appearance. If an Eligible Claimant owns a structure with this discontinued product, and has sustained compensable damage to more than 25% of an elevation (side) of the structure, then the Eligible Claimant will be paid under the Compensation Formula for the entire structure.

Limited Age Deduction.

The proposed Settlement Agreement also provides for an age deduction based on the number of years the Masonite OmniWood Siding has been installed and incorporated into the structure. For the first five (5) years following installation, there is no deduction or proration under the compensation formula. For each year thereafter, there will be a deduction of three percent (3%) per year for use of the Masonite OmniWood Siding, up to a maximum deduction of twenty-seven percent (27%), based on the compensation formula.

Settlement Claims Program

Claim Form and Procedures for Damage That Has Not Been Repaired and Product Identification. To make a claim for damage that has not been repaired, a Class member must be an Eligible Claimant as defined above, and must submit a properly completed Claim Form to the Claims Administrator, along with proof of product identification. Proof of the existence of the Masonite OmniWood Siding on an Eligible Claimant's property may be achieved by: (1) providing the Claims Administrator with a 6" by 6" sample of Masonite OmniWood siding on the home or property certified by the Claimant to have been from the structure in question that includes the lower drip edge for lap siding or the vertical groove for panel siding; (2) a prior communication from Masonite that confirms that the siding in question is Masonite OmniWood Siding; (3) submitting a Claim Form with a check for $100.00 (one hundred dollars), which will be refunded if the Inspector determines the siding is Masonite OmniWood Siding; (4) an invoice or warranty, along with photographs of the exterior walls of the structure, showing that the siding is Masonite OmniWood Siding; or (5) a photograph depicting the back of the Masonite siding and the Masonite OmniWood Siding stamp.

Inspection and Payment of Claim.

After receipt of a properly completed Claim Form, an Independent Inspector will inspect the property to verify the amount, if any, of compensable Damage. All damage associated with siding that meets the agreed definitions of Damage shall be compensable unless it is subject to one of the Causation Exceptions identified above. After completion of the inspection, the Independent Inspector will forward his/her report to the Claims Administrator, who will determine the amount of payment based on the information contained in the report of the Independent Inspector, according to the Compensation Formula defined above as applied to the damage compensable under the Settlement Agreement.

Subsequent/Multiple Claims.

You are not limited to making a single claim during the life of the Settlement. If you experience additional compensable Damage subsequent to an initial claim that was not the subject of a previous claim, you may make additional claims in subsequent years during the life of the Settlement.

Claims Periods and Deadlines.

The Settlement provides a ten (10) year claims program, subject to two provisions. The first would allow defendants to void the settlement after seven years; the second would permit defendants to extend the agreement for an additional ten (10) years. If the settlement extends for the first ten years, you must file your claim(s) by January 6, 2009. If the defendants exercise the early termination option, claims must be filed by January 6, 2006. If defendants exercise the option to extend the agreement an additional ten years, the settlement will terminate January 6, 2019. Once the Settlement expires, the remainder of Masonite's warranty, if any, will remain in effect, and you may be entitled to receive compensation for siding that fails under the terms of Masonite's warranty program separate and apart from this Settlement

Filing a claim?

If you believe you are an Eligible Claimant, in order to participate in the Settlement, you must make your claims by the applicable deadlines described above, and follow any procedures set by the Court and provide the information requested to support and verify your claim. The claims process will not begin until the Court approves the Settlement. Therefore, the claim forms (i.e., Claim Form and Claim for Un-Reimbursed Expenditures) will not be available until Court approval. The Court is scheduled to consider the fairness of the Settlement on January 6, 1999. If you have received this notice in the mail, or if you call 1-800-256-6990, contact Class Counsel, or return the attached "Claim Request Form" with your name and complete address to Independent Claims Administrator, Masonite OmniWood Claim Form, P.O. Box 925, Minneapolis, MN 55440-0925, you will receive claim forms

Additional information

The foregoing is only a summary of the circumstances surrounding the litigation, the claims asserted, the proposed Settlement, and related matters. You may seek the advice and guidance of your own private attorney, at your own expense, if you desire. For more detailed information, you may review the pleadings, records, and other papers on file in this litigation, which may be inspected during regular business hours at Clerk's Office, Circuit Court of Mobile County, Alabama. The address of the Court is: Circuit Court, 205 Government Street, Mobile, Alabama 36602. Copies of the complaint, the Settlement and the papers filed in support of approval of the proposed Settlement are available upon written request to Class Counsel.

Current information is available by calling 1-800-256-6990. This information, the Settlement Agreement, and the Court's Settlement-related orders are also available on the Internet at: http://www.kinsella.com/Masonite. If you decide to remain a Member of the Class and you wish to communicate with Class Counsel identified above, you may do so by writing to (1) Class Counsel, c/o 1301 Fifth Avenue, Suite 2929, Seattle, WA 98101, Fax: (206) 623-0594,