Lehman Brothers Financial SA (LEHNQ)

[Joe Stocks]

>>As why we saw with the judges pari passu ruling the fact that ecaps ranked in the same class as LBHI equity (class 12) and got paid means those in parity have to be paid something as well. This could be why LBHI was desperate to give ECAPS stock instead of cash but that's just a thought. <<

Swiss, The ECAPS collected under the LBIE bk proceedings collecting from LBIE assets that were liquidated. The ECAPs have a claim against the LBIE estate, the CTs did not, nor do LBHI trad preferreds. The ECAPs also have a right to convert to traditional LBHI preferreds. LBHI wanted to force that right. ECAPs holders said no, that they would rather take their chances getting additional recovery from LBIE than have their shares converted to class 12 preferreds. The CTs and the traditional preferreds can only look to LBHI for recovery.

The ECAPs are on parity with the traditional preferreds in the LBHI estate. The traditional preferreds have no parity to the ECAPs in the LBIE estate.