Lehman Brothers Financial SA (LEHNQ)

[Joe Stocks]

Muff, As to you thoughts about JPM, SEction 382 states that Lehman must retain 51% ownership of the surviving company after a merger or buyout to use the NOLs. There are several reasons why the NOLs will not be able to be used. The main one is that there will be no surviving entity with assets.

The NOL figure of $55bil means nothing in a merger other than there are some. The actual NOLs valuation is determined by specifics of the surviving company.

The Sec. 382 base limitation amount is approximated using the following equation:

Fair Market Value of Old Loss Corporation Stock x Federal Long-term Tax Exempt Rate = Section 382 Base Limitation.