Lehman Brothers Financial SA (LEHNQ)

[LexingtonVIII]

Perhaps someone can confirm if I understood the CTs correctly.

From what I gather, the CTs are subordinate debt and as per the prospectus they cannot be discharged. This tells me that when the POR gets shut down and if Lehman starts a newco, then the CTs will still be alive and to make them go away the company must buy them back at the debenture face value. This would sound logical for them to buy the CTs because of the high interest rate which they will cost. At today's interest rates, the newco could raise the same amount of cash by issuing new Trups at a lower rate offering.

If they decide not to buy the CTs back, then they will be paying the interests as mentioned on the prospectus and automatically the value of the CTs will be adjusted to their face value on the open market. I think many investors would want to purchase these shares at the rates which are offered from the prospectus.

Lastly, if we do end up with nothing, the only entity that should be taken to court is the Bank of New York Mellon who entered the CT claims without enforcing the guarantee offered by the prospectus. Whether this was done intentionally (fraudulently ) or not, This is an error which the trustee who filed the claim is responsible and liable for.

Any thoughts are welcome ..