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>>Why can't we simply stop the BS against each others and admit that we were all wrong<<
It has been months since I checked in to this site. Good to see a little reality set in. You certainly have a stubborn group here that don't understand the facts and reality of this situation with the Lehman BK. Move on guys. Turn off the lights and shut the door on this play. It will do you good.
And I see IHUB has changed their website.
Good investing to all!
I see that the hope-ium is still being passed around freely here. Over 300 new posts since I last checked in.
I don't get it. There is no chance the CTs will ever see a recovery. By now that should seem obvious to all.
New monthly operating report out. Only $300,000 in receipts for the month.
https://document.epiq11.com/document/getdocumentbycode?docId=4185574&projectCode=LBH&source=DM
I don't see much from SWiss. Hopefully he moved on. He is too young pinning hopes on a dead issue.
Thanks for the reply. I am trader. I made good money trading FNM/FRE for several years. I posted my trades around a core position. I also got attacks for posting my sells as like I violated some kind of diamond hands loyalty oath. I eventually sold my core position and today hold a few preferreds. Only about 4000 shares of FNMAS and FMCKI. Bought them cheap in 2021 at not much more than where they are now.
Here's your problem with the preferreds. The liquidation rights mean nothing unless FnF liquidates. I don't see that happening. The dividends are non-cumulative so no value is building. If FnF is released it will be released to the common shareholders. And hopefully a new board of directors. The preferred are just along for the ride.The board of directors as no fiduciary duty to the preferreds beyond what is contractual. In fact, if the directors made any decisions that may be not contractual and detrimental to the common they could be sued by the common as not fulfilling their fiduciary duties to the common.
That is case law.
FNF will more than likely not declare a dividend until there is excess cash where both the common and the preferred are paid a divy. And of course that can not happen till both are fully capitalized. I only bought my preferred at the time because the preferred were not much more than the common.
A non-cumulative preferred has little value until a pathway to consistent dividends is seen.
Hi Glen, Back not long after FnF entered conservatorship I set up a message board for Fannie and Freddie Shareholders, plus a Facebook page. The idea was to get shareholders united on a common front. I was severely attacked (by several that still post here) that I was lawyer (I am not) trying to make money off the shareholders although there was no revenue stream apparent in anything I did. And other nonsense like I we would upset FnF and they would never relaese us from c-ship. I had hoped that someone would pick up on the idea.
I suggested that us shareholders have our own annual shareholders meeting every year in Washington. Organized like a regular shareholders meeting that FnF should be conducting. Organized we could issue our own press releases. I think that would have brought major media attention showing FnF shareholders as more mom and pop and how FnF profits have been stolen from them. And, and annual in Washington's face that we are still out here.
It is an idea that I think would still work and have impact. I wish the idea would have taken hold back then when I had more energy and time.
The Facebook page is still up, although I quit monitoring it years ago.
https://www.facebook.com/fanandfred/
Swiss, Here again you are taking this completely out of context. This does not say that the CTs are equity in LBHI. This is a lawyer for LBHI filing of objection prior to LBHI exiting BK. .
Docket # 20107
Filed Sep 16 2011
Motion for Omnibus Objection to Claim(s) / Debtors Two Hundred and Eighteenth Omnibus Objection to Disallow and Expunge Certain Filed Proofs of Claim filed by Robert J. Lemons on behalf of Lehman Brothers Holdings Inc.. with hearing to be held on 11/30/2011 at 10:00 AM at Courtroom 601 (JMP) Responses due by 11/11/2011, (Lemons, Robert)
Yes. They don't. If they were convertible to equity it would be in the prospectus.
My source is the prospectus. To date, you have not shown a source where they can be converted.
Plain and simple, the CTs represent an interest in a subordinated debenture that is now a class 10b claim against the estate. Nothing more.
>>"WAMU created a new NOL company meaning that the company only have the NOLs as an asset and issued the common shares of that company to shareholders which are wamu's CT and equity holders along with warrants. <<
What is the name of the new company?
oh, cotton...
NOLs can not be distributed. They are non-transferable. They are a deferred tax asset for LBHI.
You are misreading 15.2 and taking out of context. 15.2 is an option for the plan administrator (PA) to use to help liquidate the estate. For example; Let's say Lehman affiliates LCPI and LBCS has similar assets better sold as a package as a new entity that be liquidated individually. 15.2 says the PA could issue new securities for that entity to be distributed to the equity holders of LCPI and LBCS in lieu of a cash distribution.
If you think it out there is no need for a new entity for LHBI as if anything is left over it would flow to equity holders. But it is obvious there will be nothing left over as the creditors have not been satisfied in full. I know you disagree with the PA on the full utilization of the NOLs to offset COD income. You are just plain wrong on that. .
You wrote: "if they indirectly transfer NOLS to creditors, then simply wipe out the business, that would not be fair to creditors. The whole point of bankruptcy is to pay back creditors the best way possible. You speak in paranoid terms wherein bankruptcy is meant to con creditors which is not the case.
why would LBHI snake the creditors as you and mellowbird allude to so much? "
I have no idea what you are trying to say here. What does LBHI snake the creditors mean? I what mean by speak in paranoid terms?
Don't answer. I don't care.
"a chapter 11 case, a liquidating plan is permissible. Such a plan often allows the debtor in possession to liquidate the business under more economically advantageous circumstances than a chapter 7 liquidation. It also permits the creditors to take a more active role in fashioning the liquidation of the assets and the distribution of the proceeds than in a chapter 7 case."
https://www.findlaw.com/legalblogs/small-business/what-is-chapter-11-liquidation/
The "mother ship" is Lehman (LBHI) also known as the plan administrator. LBHI is charged with one thing in the Modified Plan (And again, no where in the plan does it say anything about reorganization). That one thing is being in charge of the liquidation of the estate through one or more liquidating trusts for the benefit of the creditors. Liquidating all assets. The plan states:
I know you asked Mellowbird but to save sometime...
From the modified plan.
Implementation of the Plan
6.1 Plan Administrator.
(iii) exercise its reasonable business judgment to direct and control the wind down, liquidation, sale and/or abandoning of the assets of the Debtors and/or Debtor-Controlled Entities under the Plan and in accordance with applicable law as necessary to maximize Distributions to holders of Allowed Claims
https://www.sec.gov/Archives/edgar/data/806085/000119312511239866/dex992.htm
Swiss, Arguing with you cost me money as it takes me away from doing research on some distressed debt issues that I can make money on. And, I get to trade ideas with others that do the same. Here is a post today. LUMN debt has been hit hard. Trying to find value in some of the deserved or undeserved panic selling. Here I don;t have to argue over the definition of "utilized".
"Bot some of the QWEST bonds 6.875% 07/15/2028 912912AQ5 for an account with a little less risk tolerance. Looking at the 2021 10K the Qwest bonds had the same S&P rating for their unsecured as LUMN's secured. Of course, those rating have dropped. Looking forward to the 2022 10K to come out. Also, Embarq bond is of interest. Poorly rated though at Caa2 a Moody's with end of last year two notch downgrade. Probably due to "Our recent digital transformation efforts and continued focus on our fiber-based infrastructure assets have prompted management to reassess and ultimately change the accounting treatment of these indefinite-lived assets to align with our focus on growth products versus our declining copper-based products. As a result, during the first quarter of 2021, we reclassified an indefinite-lived intangible asset to finite-lived intangible asset."
Embarq Corp 7.995% 06/01/2036 29078EAA3 YTM of 18.95%. These bonds were at 125 two years ago. Now 47. Current yield of 16.9%
Moody's doesn't say much but they do say this; "Embarq Corporation is a wholly owned subsidiary of CenturyLink, Inc. Debt issued by Embarq
Corporation is not guaranteed by CenturyLink, Inc., but is structurally senior to CenturyLink, Inc.'s debt instruments. Please see full Credit Opinion posted under CenturyLink, Inc. As debt matures at Embarq, it will either be paid off of refinanced at the CenturyLink level.
That said, I bot more LUMN bonds today myself."
Moving on Swiss.
"Now look at you"..said as Swiss stands back awaiting his pat on the head by Jersey and others as it is the only outlet for him to find his self worth.
Sorry, Swiss. I tried. But you just don't understand this stuff. Don't feel bad, Jersey doesn't either. But the difference is, Jersey knows that and will be the first to admit it.
Prime example is this link you provided. You see no difference in the context of my reply and that of what you are trying to sell with you debt to equity swap scheme. You just read the words and think they are the same but they are not the same in different context.
Spread you wings a little. Research the issues facing other issues like DHC, SMLP, and LUMN and so many others. Repeating the same stuff here over and over again gains you no new knowledge. At your level you should be listening more and spouting off less. I make a pretty good living trading. You can too but you have to broaden your knowledge. The Lehman story is done. It played out and much was learned. But now it is a broker record. Move on.
Thanks for proving my point. I spend way too much time trying to educate those on this board that are clueless to the BK process. The modified plan does not offer any leeway other than a full and complete liquidation of the assets for the benefit of the creditors. And distributions made as to priority as outlined in the modified plan. No reorganization. No recapitalization. No debt for equity exchange. The modified plan does not allow it. Anything that may hint of such is there to help with the total liquidation.
Swiss, All the items you post about debt for equity means nothing for Lehman and the CTs.
The main point you are missing is that Lehman exited BK in 2012 with a court order plan to be liquidated. The plan calls for one or more liquidating trust to liquidate all the assets of Lehman. The plan says;
"10.2 Purpose of the Liquidating Trust. Each Liquidating Trust shall be established for the sole purpose of liquidating and distributing the assets of the Debtor contributed to such Liquidating Trust in accordance with Treas. Reg. § 301.7701-4(d), with no objective to continue or engage in the conduct of a trade or business"
The plan is clear. The facts are clear. And here 11 years later the most recent quarterly report shows relatively few assets remaining. And, that all the NOLs will be fully utilized as Lehman reports. We that do understand the process unlike most here know that Lehman is nearly gone forever. There will be no distribution to the CTs. To believe that there will be is nonsense.
I really do need to move on. I was hoping to educate those here to look at the facts of the case. In my near 30 years of visiting message boards I have never seen one like this that remains in denial of what the prospects are for their investment for now now over a decade.
I see no need to further debate with you or others about the prospects of the CTs. I know I have probably said this before. I hope I can stick to it and not waste and more time. I certainly have presented my case for no distributions. I hope at some point you will face the facts and move on yourself. So many other stocks out there. Some many other investment opportunities.
Swiss, You still have not shown anything that proves that there will be remaining NOLs versus LBHI saying they will all be utilized. You have not shown anything to show that any assets will remain after all distributions have been made after the ordered total liquidation contrary to the modified plan saying all assets will be liquidated. Without any remaining assets your debt for equity scheme is dead.
The ECAPs are not in parity with the Cts because they were not issued by LBHI. They were only guaranteed by LBHI. And the ECAPs were given a subordinated claim against the estate due to that subordinated guarantee. And nothing says the Cts have class 12 equity rights. And, why would that matter anyways? Class 12 is subordinate to the CTs class 10b.
You have shown nothing that shows the equity will have any remaining assets.
I am a distressed debt specialist. Bought some distressed bonds today. So, technically I was wrong about post bk estate's name. And, wrong that I thought that Lehman filed and individual tax return along with their affiliates versus a consolidated return. Both immaterial facts when it comes to trading distressed issues.
My last word. I have left the building and now gone for the weekend.
This goes back to me thinking that the name of the entity running the Bk process, or plan administrator was Lehman Brothers Liquidating Trust, and not Lehman Brothers Holdings Inc with the new directors and the exit from BK in 2012. And admitted I was wrong about the name of the plan administrator. But the main point remains that I was responding to is that the NOLs do not reside outside of the estate.
That is really a moot point and has nothing to do with you needing something in black and white to show remaining NOLs. And, let's say I do not know what I am talking about. But, you and I can read and Lehman says that it is projected that all NOLs will be fully utilized. Show me why you disagree with that? What is your source?
This is typical of you. You can't back up a statement so you go back in history and find some obscure statement that I made that is not totally factual and respond with that.
The NOLs are not part of the liquidating trust. They belong to LBHI. The liquidating trust is an entity formed by LBHI to liquidate the assets as outlined in the modified plan. And yes, the NOLs would reduce the tax burden of LBHI which would mean more funds that remain in the estate to be distributed the creditors by priority as outlined in the modified plan.
So, show me in black and white why LBHI is wrong in saying that all the NOLs would be utilized.
I hope some day the lights come on and you see how weak your argument is in thinking the CTs will see a recovery. The process is very simple. The LBHI estate gets totally liquidated and the proceeds are distributed to the creditors by ranking as shown in the modified plan. Proceeds will not be sufficient to pay the higher ranking claims, so the lower ranking claims will see no recovery.
>>Can you show in black and white how much NOLS are left?<<
Yes. ZERO. From the most recent Lehman produced quarterly report in black and white.
The common stock and yet to be issued preferred treasury stock (and there is probably some un-issued common treasury shares as well) have no value as Lehman owns nothing. So what can Lehman offer in value to debt holders for exchange? Common and preferred shares? More shares that own nothing and have no shareholder equity.
This is also going nowhere. You claim there is some value but can't show what it is. Common and preferred shares don't have value in themselves. They have to represent tangible value in something and there isn't anything.
And I said I was wrong about the consolidated returns. But we are not talking about that now.
I know, I know. Do you know that a recent study came out that shows that those that show compassion for others tend to live longer? I (Joestocks and Mellowbird) show my compassion for you CT bagholders by trying to teach you what you are seeing wrong in the Lehman BK so this doesn't happen to you all again. Trying to save you some money in a future trade. That is true compassion trying to help others, especially those that refuse it.
27 years old and you don't see yourself as a grown man? That explains your demonstrated lack of maturity.
>>In the event the debt is exchanged for the equity money can be raised through debt.<<
Why would Lehman have to give the bondholders equity and just not raise capital by issuing debt?
Anyway...let's say I am a bondholder. What can you give me that you call equity in exchange for my debt holdings? Equity in what?
What do you have to support the claim that Lehman has equity to exchange?
>>and tons of equity<<
What do you have that supports that they have tons of equity? It certainly isn't showing up on the Lehman quarterly reports. Quite the contrary. They have huge negative equity of over $100 bil.
>>I did not say that LBHI had $31B Cash sitting around 'right now'...<<
So, not right now. So where is it going to come from in the future?
If the debt is exchanged for debt, then the debt no longer exist.
Think it through. Where does the $31bil in cash come from? There are only two parties - the creditor and Lehman. Surely the creditor is not going to come up with $31bnil in cash AND cancel their debt.
>>The $31B Cash they conserved through 'Debt-to-Equity Exchange' <<
Where exactly does the cash come in an debt to equity exchange? The creditor exchanges their debt for equity in Lehman. No cash is produced.
Back in 2012 my charts show me that LEHNQ sold for less than a penny as a low, and no more than 11 cents at the high. Obviously no one of size was seeing an NOL benefit, nor the CTs seeing a recovery.
Looking at the balance sheet it was well known by many of us in 2011 that Lehman would use up all their NOLs. The writing was in the financials and the disclosure statement and the main reason I hit the sell button. Mr Brandt must have been misinformed. I remember reading that article in 2012 and thinking Brandt was wrong. You notice that no one else of financial stature wrote about an NOL play. And didn't Brandt back off that theory later?
Between the 2008 filing and 2011 Lehman unloaded many billions in assets. I think nearly $400bil. It would not be unreasonable to think that they showed capital gains of more than $50 bil. Reading their comments in the filing it appears they may have.
Good find, Swiss!
>>corporations that elect either to file a consolidated return <<
There are restrictions on who can file a consolidated tax return. Lehman would not be eligible. Each corporation filed their own bk petition. They did not file consolidated tax returns. Consolidated tax returns is different from a company that reports consolidated earnings in a 10k/Q for the benefit of the public. The IRS has laid out many rules and definitions as to how affiliate companies are legally allowed to consolidate and file. Lehman did not want to be seen legally as one entity.
Understanding a Consolidated Tax Return
Your robot friend is wrong. Sub-chapter S corporations can but not C corps. Ask your accountant.
NOLs are deferred tax assets. They have no value unless you have net gains to use to offset. FASB accounting rules say you can't include as an asset unless you can project gains to use them. FannieMae is a good example of that. And then you can only include what you foreseeable see to use for a set period of time.
Not true. The NOLs belong to the Lehman Brothers Holdings Inc estate. They do not underwrite anything. They are used to offset taxable gains for the benefit of the creditors which would include unsub and sub debt.
Lehman has used all of their NOLs. This is what they said about their net tax liability net after NOLs. There would be no tax liability if they still had NOLs to use;
A C corporation cannot allocate its NOLs to its shareholders.
Ask your new robot friend about C Corporation allocation.
>>The 17 million preferred’s are authorized shares not treasury shares.<<
They are both.
Let me explain 15.2 to you which falls under Article 15 - Miscellaneous Provisions.
Here the Modified Plan says (in a nut shell) that the plan administrator at his DISCRETION may allow transfer of assets to a new or existing entity to facilitate the liquidation of those assets. Shares of that entity will be distributed to those having "Allowed Claims or Equity Interests against a Debtor that contributed assets to the entity issuing New Securities." And the shares distributed will be counted as a distribution from the estate as valued.
No where is 15.2 does it say that the plan administrator can distribute un-issued treasury preferred shares to creditors. That would be something Lehman would have to do and not the trustee. And Lehman can only do that once all the creditors have been satisfied in full and the trustee returns remaining assets over to the estate. And in that regard, we know that there will be no assets to be returned to the estate. The plan administrator is only charged with liquidation the assets of the estate. They have no authority to issue Lehman common or preferred shares.
In addition, this provision was never used. And with the last quarterly report showing only $2million in real estate remaining, it will not be used in the future.
You have confused the plan administrator with Lehman.