Lehman ABS Corp., 7.375% Corporate Backed Trust Certificates, Series 2001-8, Class A-1
The trust is comprised of $32,575,000 principal amount of General Motors 8.10% Debentures due 6/14/2024 (MTLQ.GF / CUSIP 370442AV7). The underlying securities will be exchanged for equity securities in New GM. Debtholders are expected to receive 10 percent of the common stock in New GM and warrants to buy another 15 percent. GM is expected to be a public company within 6 to 18 months.
The issue price was $25. Each certificate represents a 1/40 interest in the underlying $1,000 debenture. The prices of the CCYPQ and MTLQ.GF should be highly correlated. For example, CCYPQ should trade near $2.50 if the underlying security, MTLQ.GF trades at 10 or $100 per $1000. The trust will receive New GM securities, which will be sold and the proceeds distributed to certificate holders. CCYPQ may trade at a slight discount since the trustee will be eligible to receive reimbursement of Extraordinary Expenses prior to any distribution to certificate holders. Extraordinary Expenses will arise from efforts to protect certificateholders.
This is a thinly-traded issue. There were only 1,303,000 CorTS certificates issued. There are no market makers in this security. It is not listed, traded or quoted on any stock exchange, the OTCBB or the Pink Sheets. Trades in grey market stocks are reported by broker-dealers to their Self Regulatory Organization (SRO) and the SRO distributes the trade data to market data vendors and financial websites so investors can track price and volume. Since grey market securities are not traded or quoted on an exchange or interdealer quotation system, investor's bids and offers are not collected in a central spot so market transparency is diminished and Best Execution of orders is difficult.
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