Lehman Brothers Financial SA (LEHNQ)

[camaro4me]

ECAPS

1) Boss, you say that the CTs' Subordinated Guarantee is relevant on June 19, 2019!

Excerpt from the CTs' June 19, 2019 hearing:

MR. Fail: "And certainly, the prospectus
8 which -- we've covered this in prior objections, perhaps
9 before Your Honor's taking over the case, or perhaps after -
10 - the prospectus and documents make it very clear that the
11 only guarantee issued was the limited one, the only
12 guaranteed issued here that's relevant. It's the very
13 limited, very subordinated guarantee of LBHI."

2) Then boss, you say or find out that the CTs' Subordinated Guarantee has no need in this bankruptcy on October 16, 2019.

Excerpt from Mr. Fail's [Plan Administrator] reply brief:

Case 1:19-cv-06397-PAE Document 11 Filed 10/16/19 Page 14 of 32

"There was, however, no need for the Trusts to file a proof of claim
on account of the Subordinated Guarantee."

******
"The Trusts (but not the holders of Trust Preferred Securities) were
listed on the Bar Date Order’s Exempt Entities List, which created an
exemption to the Bar Date for proofs of claims filed by the Trusts. (See
Bar Date Order at 3, 5 (A012-14).) There was, however, no need for the
Trusts to file a proof of claim on account of the Subordinated Guarantee.
As noted above, the beneficial interests of the Trusts and the individual
holders of Trust Preferred Securities were and are represented by more
than $1.26 billion in Allowed claims against LBHI which were filed by
the indenture trustees for the Subordinated Debt."



3) What is the CTs' Subordinated Guarantee? Read the parity clause below! This is big medicine boss!

Excerpt from CTs' relevant prospectus:

"Status of the Guarantees
The guarantee will constitute an unsecured obligation of Lehman Brothers Holdings and will rank:
•
subordinate and junior in right of payment to all other liabilities of Lehman Brothers Holdings,
•
on a parity with the most senior preferred or preference stock now or hereafter issued by Lehman Brothers Holdings and with any guarantee now or hereafter entered into by Lehman Brothers Holdings in respect of any preferred securities of any affiliate of Lehman Brothers Holdings, and
•
senior to Lehman Brothers Holding's common stock.
The guarantee will not place a limitation on the amount of additional senior debt that may be incurred by Lehman Brothers Holdings.
A | 72
The guarantee will constitute a guarantee of payment and not of collection (that is, the guaranteed party may institute a legal proceeding directly against Lehman Brothers Holdings to enforce its rights under the guarantee without first instituting a legal proceeding against any other person or entity). The guarantee will not be discharged except by payment of the guarantee payments in full to the extent not
21
paid by the trust or upon distribution of the junior subordinated debt securities to the holders of the preferred securities in exchange for all such preferred securities.
The guarantee, when taken together with Lehman Brothers Holdings' obligations under the junior subordinated debt securities, the indenture and the declaration, including its obligations to pay costs, expenses, debts and liabilities of the trust, other than those relating to trust securities, will provide a full and unconditional guarantee on a subordinated basis by Lehman Brothers Holdings of payments due on the preferred securities. See "Effect of Obligations Under the Junior Subordinated Debt Securities and the Guarantee." "

https://www.sec.gov/Archives/edgar/data/806085/000104746905000357/a2149684z424b2.htm

4) Boss, you drive a hard bargain.