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But Hestheman, orange you forgetting the apple is in bankruptcy and the orange is not LOL!
Further proof from the Prospectus to back what you are saying...
"Lehman Brothers Holdings will irrevocably guarantee that if a payment on the junior subordinated debt securities is made to the trust but, for any reason, the trust does not make the corresponding distribution or redemption payment to the holders of the preferred securities, then Lehman Brothers Holdings will make the payments directly to the holders of the preferred securities."
There's no way the debtor is making a payment to the trust as a Class 10B payment, and then giving it to the senior debt as a way of "satisfying" the Class 10B holders!
And it takes mergers to generate the business profit to apply the NOLs against. In your opinion, can the first merger happen anytime or do they need to distribute all available cash through the semi-annual distributions first? At what point can they determine there is no more available cash?
Thanks for the reply toogood. I'm very much ok with the CTs going into the equity side of things. There's a bigger plan here IMO that is being worked out, however slowly. And that plan is not the total liquidation and annihilation of the Lehman machine. I just don't see it going down that way. And nobody, not even JS, can prove 100% ahead of time how this is all going to turn out.
You're hot on the trail Cotton, JS is getting nervous! In his own words he'll consider himself an idiot for not having bought the CTs...
Has anyone ever heard of a creditor getting a payment outside the POR after a company has exited from bankruptcy protection? I thought so...
Keep up the great work Cotton!
No, I don't have a pacer account. I'm sure someone on the board does though. I've seen reference to pacer on other boards, but never got an account for myself...
Congrats on gittingerdun on the tractor Jersey! I think that turns it into a gotterdid!
The thing with these distribution dates is that was always a date in the future where there was a chance we were going to get something. It's just a normal thing to look forward to and have hope as that date approaches. I think we can clearly see now that we won't get anything as long as part of the semi-annual distributions.
I just don't see the CTs going down with no payment though. We definitely would have seen a MUCH bigger sell-off after Thursday if that were the case. It'll happen probably when we least expect it, and how crazy fun will that day be!
Enjoy the nice weekend weather!
You mean on paper right? You're only down if you sold!
Just jump on an ol' Wheelhorse tractor this weekend and forget about it all!
Have a great weekend everyone!
Hang in there, our day will come! Just look at it as extra time to figure out what to do with your windfall! I, for one, wasn't ready Thursday morning anyway! LOL!
All 4 CTs are GREEN, over 38K shares sold, looks like AH Merger news to me! LOL!
Somebody wants more shares! Nice to see some green today, even if it goes away later!
LEHNQ 11:54am EDT 0.3749 Up 0.0739 Up 24.55% 0.3010 0.3749 9,000
LEHLQ 11:52am EDT 0.4799 Up 0.1784 Up 59.17% 0.3017 0.4799 5,100
LHHMQ 11:50am EDT 0.4099 Up 0.1290 Up 45.92% 0.4099 0.4099 5,000
I'm not saying there's a 100% connection to the CTs, but issues with the Lehman brokerage sale to Barclays are still being resolved according to the LBI Trustee...
From the LBI Trustee's Interim report file 9/9/14.
"30. Open issues with Barclays remain a principal obstacle to the conclusion of this liquidation."
Understanding that this is LBI and not LBHI, but there are still aspects of the sale being worked out IMO.
Basically we are subordinated debt, and even our Prospectus says the senior debt needs to be satisfied before we get anything. The Disclosure Statement says it in a different way, but I believe is referencing our Prospectus:
"In addition to the Distribution of their Pro Rata Share of Available Cash, holders of Allowed Claims in LBHI Class 3 will receive their Pro Rata Share of amounts that, if not for certain contractual subordination language, would have been distributed to holders of Allowed Subordinated Class 10A Claims against LBHI, Allowed Subordinated Class 10B Claims against LBHI and Allowed Subordinated Class 10C Claims against LBHI".
I don't believe 10B is getting a payment as part of the POR and then having it go to the higher classes, I just think 10B is not getting a payment at all as part of the POR.
Four out of Five paths are still alive IMO, but the POR distribution path is out from what I can tell. I will go down with equity if that's what happens, but I just don't see that being the outcome!
Part of me was still hoping for a distribution for 10B, but I don't know if I really believed it would happen. It still would have been absolutely great to see the N/A(2) replaced by some number, even a small one, but I really wasn't shocked to see the notice details this morning.
With that said, I will not look toward any future semi-annual distribution to include 10B. That is one avenue for payment that is shutdown IMO. My hope for payment will continue to be on either:
1> acceleration of payment once the stay is lifted. Even the Disclosure Statement states "Any attempted acceleration after the Commencement Date is disregarded because a creditor may not accelerate debt post petition without first seeking relief from the automatic stay.". It seems the last extension of the stay almost didn't happen, and might indicate the end is near.
2> A connection between the JPM $1.7B claim and our CTs. That seems to be very much alive and well.
3> The possibility that the CTs are an assumed liability after all for Barclays.
4> The closing of the POR because of a merger/ongoing concern. My understanding remains that if equity sees a dime at any point down the road, the CTs had to have been taken care of as far as face value and back interest. I refuse to believe at this point that ALL equity is out of the money when all is said and done.
Just my opinions of course, but I think we still have a good shot at one of these 4 paths. I'm going with the thought that the 150 year old behemoth called Lehman is not going to just disappear. I'm still happy with the amount of risk I've taken based on the amount of potential reward.
GLTA!!!
Good answer cotton - thanks!
Cotton - what's your opinion about who will win? The reading I've done on the Adversary Case, my vote goes to JPM. LBHI is/was having a fit about what JPM was "forcing" them to hand over as far as collateral, but at the same time they were spotting them up to $100B per day to clear the transactions that were happening in that crazy week in 2008!
Here's a link to all the dockets for that case if anyone's interested:
http://dm.epiq11.com/LBH/Docket#Debtors=4285&RelatedDocketId=&ds=true&maxPerPage=25&page=10
Docket #1 on page 10 has a long but interesting opening argument from LBHI's point of view.
The thought isn't that the $1.7B is tied to the CT's CUSIPs, it's that JPM can buy back it's own debt with money from the reserve, since the collateral will now cover the CTs. At least that's my best shot at what he is suggesting...
"JPMorgan anticipates that these redemptions will not affect its earnings."
Seems to me for a $1.7B expense to not affect earnings it must be coming from a reserve of some sort.
Would be a weird coincidence if it's not tied to the $1.7B claim!
From what I could see in the docket, the 2nd-5th distribution notices (similar to what we're waiting for tomorrow) came out between 6-8am.
Of course there's a chance they could surprise us with something going to 10B, but I'm not expecting it. We could be getting what we're due outside the POR, which could be anytime.
I do agree with that...
Agree, but the balance sheet can't necessarily be relied upon either...
"The Balance Sheets are not meant to be relied upon as a complete description of the Company, its business, condition (financial or otherwise), results of operations, prospects, assets or liabilities."
I also wonder how many claims have been cleared because of Docket 29505 allowing the Plan Administer to settle claims less than $200M without court permission.
I have to believe they've exercised that opportunity more than a few times...
I'm am letting Lehman do the accounting. they showed us very clearly that Class 3 has allowed claims of $48B.
Class 3 = $48B in allowed claims. It's in the docs and in the math...
The Disclosure Statement had the total distribution for the POR at $43.712B. My notes say that this matches a number you,toogood, had at the time.
Here is the original breakdown:
The original-no-longer-valid total of $43.712B was based on:
Class 3 getting 21.1% of 83.724B = 17.678B
Class 4A getting 15.6% of 52.327B = 8.147B
Class 4B getting 15.2% of 11.563B = 1.758B
Class 5 getting 12.2% of 52.702B = 6.410B
Class 6A getting 26.0% of .054B = .014B
Class 6B getting 17.0% of .332B = .560B
Class 7 getting 19.9% of 11.390B = 2.267B
Class 8 getting 14.4% of 1.446B = .208B
Class 9A getting 11.5% of 39.658B = 4.555B
Class 9B getting 7.0% of 1.948B = .136B
--------
43.712B
But now we know that instead of $83.724B for class 3, it was reduced to $48B for the first distribution in April 2012.
So the 83B was at the time of the POR, but it changed!
Exactly - $35B in claims just went poof! And that is just one example. How many more are there???
Further proof of Class 3 having an allowed claim of $48B.
"On April 17, 2012, the Debtors will make a distribution in the amount of $2,938,657,746.90 to the Trustee on behalf of Senior Noteholders..."
From the JS image of the what class 3 got in the first distribution:
Class 3_______Senior Unsecured______6.023822%
$2,938,657,746.90 / .06023822 = $48,783,940,594
which matches ", seeking to reduce and allow the Global Proof of Claim to the aggregate amount of $48,783,940,671.27 (the "Reconciled Claim Amount")."
The quotes are from the link mik1 provided:
http://www.wilmingtontrust.com/lehman/pdf/04-11-12_Lehman_Notice.pdf
And it's true also that folks like JS accepted a reduced amount of their class 3 bonds as a convenience claim. I wonder how many other folks did the same.
And let's not forget that along the way the Plan Administrator has been able to settle claims less than $200M without court approval (I think).
Do we really know how much is left in unsettled claims for class 3 at this point in time, or because of the flexibility on the <$200M claims, how much is left to pay all classes in FULL????
Thanks mik1! I also just updated my post with the following:
10082 WILMINGTON TRUST COMPANY, AS INDENTURE TRUSTEE 09/02/2009 $43,811,071,807.90
Image
Creditor Address:
ATTN: JULIE J. BECKER
50 SOUTH SIXTH STREET, SUITE 1290, DROP CODE: 1700/MINNESOTA
MINNEAPOLIS, MN 55402-1544
Debtor:
08-13555 Lehman Brothers Holdings Inc.
Amounts:
Allowed Unsecured: $43,811,071,807.90
Claimed Unsecured: $49,780,480,905.49
Remarks:
Claimant asserts amount in the range of $49,214,955,480.71 to
$73,162,259,495.49. Sr Note Indenture dated 9/1/87
THIS CLAIM IS ALLOWED
Toogood - I have in my DD notes that the Class 3 claim was dropped from $83B to $48B, but I can't find the source of that (yet). Are you sure the Class 3 claim is still $83B?
I'll be looking for the claim modification today and will hopefully find it...
Edit - this may be what I was looking for:
10082 WILMINGTON TRUST COMPANY, AS INDENTURE TRUSTEE 09/02/2009 $43,811,071,807.90
Image
Creditor Address:
ATTN: JULIE J. BECKER
50 SOUTH SIXTH STREET, SUITE 1290, DROP CODE: 1700/MINNESOTA
MINNEAPOLIS, MN 55402-1544
Debtor:
08-13555 Lehman Brothers Holdings Inc.
Amounts:
Allowed Unsecured: $43,811,071,807.90
Claimed Unsecured: $49,780,480,905.49
Remarks:
Claimant asserts amount in the range of $49,214,955,480.71 to
$73,162,259,495.49. Sr Note Indenture dated 9/1/87
THIS CLAIM IS ALLOWED
True, but what it DOES tell me is they are settling up on any outstanding debt in the $1.7B range. There's something about that range they don't like and they feel pressured to settle up with the debt holders in that range with cash. Good thing our debt is in that range!
How's that for some AWESOME DD!!!!!
(I hope nobody took me serious!) :)
Great work cotton on putting it all together!
And I have to say I am thankful also to Barclays for not taking the CTs in 2008, because they obviously wouldn't have been around for me to scoop up had they done that!
I know, but a payment could come our way soon outside the POR based on what's decided today IMO...or we will get something on Oct 2nd which I'm very much ok with :)
The 9/26 (or so) announcement of who gets what can't get here fast enough!
Not sure RL, but it could be both, since either would be valid concerns I would think.
I also appreciate your contributions to the board!
Exciting times for sure!
I don't know...I can't see JS calling everyone a wand-waving fairy like gus did. I think JS is above that and has a more mature attitude even towards those he disagrees with. Gus, on the other hand...
My guess is that the judge cleared the schedule for today with all those adjournments because she needed to totally understand what was going on with the $560M motion. It wasn't a slam dunk IMO and the judge needed to get some clarification. Once we see the ruling (hopefully SO ORDERED), we'll know what's happening.
Maybe after hours PR with a halt on the CTs in the morning???? How's that for a WAG! At least Gus isn't here anymore saying I'm waving my magic wand!
"I don't see a link if this is the case you are referring to."
So let's take it to the hypothetical then. If Bancorp had declared bankruptcy while selling 100% of BankAtlantic to BBT, then wouldn't you agree the Trustee for the TruPs has the right and duty to demand acceleration at that point, or whenever the stay was lifted?
That hypothetical case just further backs up the case for the CT's trustee doing the same. In that case it was 100% of what Bancorp owned was sold. Although the brokerage obviously wasn't the majority of what makes up Lehman Brothers, it was a nice chunk, and I believe they even gave up the rights to the name "Lehman Brothers" as part of the sale.
I agree, and that's why I don't think classes 3, 5, or 7 have that sort of "enhanced blocking power"!
These CTs do have it and they know it. Get us out of the way and move forward already!
I wasn't speaking in reference to the "accelerated" distribution of $560M, just to the similarity to the Bancorp TruPs. We'll have to wait and see what happens tomorrow, and then what happens when the automatic stay is lifted...
So you really must be 110% sure that you are right. Even if you were just 95% sure, it would make sense to buy a few CTs right? C'mon Joe you can do it. We'd love to see you in the winners circle with us one day!
So is the trustee for the bonds going to accelerate the repayment? And that would be based on what section in the link you provided?
Is there evidence anywhere that Wilmington is going to force acceleration of the bonds? I haven't seen it if it exists, assuming that they can and will as you seem to think they are planning...
Right, and that's my point. I've never seen a similar statement for bonds like "The indentures allow acceleration of the BONDS upon the sale of “substantially all of the assets” of Holdco unless the buyer assumes the indenture". That's why the sale of LBI is an important factor for our CTs and not the bonds.
I also took notes on the Bancorp similarity a few years ago. Here is what I noted about the what the issue was. In this case Wilmington was the trustee for the TruPs...
- Bancorp is a BHC
- Bancorp owns 100% equity of BankAtlantic (BA) (it's only real asset)
- Bancorp agreed to sell BA to BBT Corp
- Bancorp will receive 100% equity of a newly formed entity that will own BA's criticized assets
- Plaintiffs sue to enforce debt covenants that prohibit Bancorp from selling "all or substantially all" of its assets unless the buyer assumes the debt
- BBT has not agreed to assume the debt
- Default Event will result in the debt accelerating
- Bancorp cannot pay the accelerated debt
- Plaintiff is trying to block the sale
- Between 2002 and 2007 Bancorp raised $285M in TruPS
- Bancorp formed a wholly owned trust subsidiary that issues preferred-equity securities (TruPS) to investors
- The trust subsidiary purchases as its sole asset junior subordinated notes (JSN) issued by the BHC, and the terms of the TruPS mirror the terms of the JSN
- The BHC makes payments of P&I on the notes, and the trust uses the payments to redeem or pay divis on the TruPS
- Bancorp issued 11 series of TruPS
- Wilmington Trust (WT) was the trustee for some of the TruPS
- WT is a plaintiff and is suing
- WT says it will accelerate the debt if there is an Event of Default and believes every trustee would do so
Cotton - I don't know much about the Class 3 bonds (Wilmington Trust), but do you know right off if they have a similar guarantee concerning the "crown jewel" selloff as the CT's guarantee? I'm guessing they don't, and if not, that would clear up a lot of the why that (selling of LBI) is such an important factor here.
I agree totally with what you're saying here, just thought it could help clear things up if we knew the bonds didn't have a similar guarantee. I'm guessing they don't, but it would take a lot of digging on my part to prove that if so...
Also not sure about the Class 5 debt (Senior 3rd Party Guarantee claims).
Class 7 debt definitely wouldn't have that sort of guarantee since they are just general unsecured claims of trade vendors, suppliers, and service providers.