Progress made in the Reporting Period and in the subsequent period to 8 October 2025 Preferred equity distributions Following progress made in the Reporting Period, including the sale of LBIE’s residual assets to LBH, and 🆘substantial recovery of c.$50.1m from the IRS (equivalent of c.£37m), the Directors proposed, in consultation with the Administrators, that the Company make a further distribution of c.£53.6m by way of a preferred equity dividend payable to LBHI2 as the sole holder of LBIE’s preferred equity. This dividend was paid on 4 September 2025. The Administrators considered that the dividend was appropriate on the basis that funds could properly be paid to the Shareholder from distributable reserves and were not required for any other purpose. Total preferred equity distributions to LBHI2 during the course of the administration total c.£551.6m. Eldon Street Holdings Limited (“ESH”) - in administration During the Reporting Period the Administrators accepted a proposed settlement offer of c.£0.3m from the administrators of ESH in full and final settlement of LBIE’s unsecured claim of c.£5.4m and Mable’s unsecured claim of c.£7.1m which had been assigned to the Company. Total recoveries in respect of these claims equate to 53% of the value of the combined claims. Overseas litigation - security for costs In the Reporting Period, c.€1.5m was released back to the Company in respect of security for costs in an overseas litigation. MCF As set out in our previous report, LBIE exercised its option to purchase MCF’s claim into LBHI for a nominal amount in accordance with the terms of the compromise agreement with MCF’s creditors signed in April 2021, allowing the Joint Administrators of MCF to proceed to closure of MCF’s administration. The MCF administration was closed on 4 April 2025 and the company was dissolved on 14 July 2025. Recovery from IRS As set out in previous reports, the IRS approved LBIE’s request for treaty benefits through the competent authority process in August 2021 allowing recovery of taxes and associated interest. Tax returns were filed with the IRS in Q4 2021. 🆘During the Reporting Period, the Company recovered c.$50.1m (c.£37m) from the IRS, representing a substantial proportion of the reclaim. Of the c.$50.1m LBIE received from the IRS, c.$45.3m represented the principal amount claimed and the balance related to associated interest. This represents a lower amount than LBIE anticipated and claims have been submitted to the IRS for the🆘 remaining balance of c.$11.7m. On 4 September 2025, the Company distributed the amount received from the IRS as part of the preferred equity distribution mentioned above. Other potential recoveries As advised in the last report, LBIE has a claim in an overseas liquidation, of which LBIE continues to be a member of their liquidation committee. No further recoveries have been received during this Reporting Period or prior to the end of the administration. This residual asset was sold to LBH on 3 September 2025, with the value being based on estimated future recoveries. The Administrators have also continued to pursue a potential recovery relating to a 50% holding of a claim in an overseas bankruptcy. Ownership of this claim has also been assigned to LBH, with the sale value being calculated using market prices for the sale of similar claims, together with recovery of costs. Whilst the assignment is valid as a matter of English law, in order to effect a full transfer of the claim to LBH within the overseas jurisdiction, the bankruptcy trustee must consent to the assignment of the claim which may take some time. To that end, work to complete the transfer of this claim to LBH will continue in the MVL process. Joint Administrators’ combined progress and final report | PwC | 4
A distribution was declared in May 2025, which was due to be paid in July 2025 with recoveries to LBIE of c.£8.75m, subject to no objections being received. Following receipt of objections from various creditors, this distribution is now not expected to be made any earlier than December 2025. This distribution was fully reflected in the sale price to LBH. Should it or any further distributions be made prior to the transfer being fully completed, this will be made to LBIE and transferred immediately to LBH as owner of the claim. Sale of residual assets to LBH As explained in our previous report, recoveries attributable to LBIE’s small number of remaining assets were not anticipated to have been received before the expiry of the administration on 30 November 2025. We have not sought an extension to the administration as all creditor claims have been paid. As LBH is the UK group entity expected to remain in administration for the longest period, the Administrators agreed to sell the remaining assets of the Company, with the exception of its claim for interest from the IRS, to LBH at current market value for their aggregate value of c.£16.5m and this transaction was executed on 3 September 2025. On 4 September, the Company distributed the sale proceeds to LBHI2 as the sole holder of LBIE’s preferred equity as part of the preferred equity distribution mentioned above. Connected parties As mentioned above, and prior to entering into the connected party transaction with LBH, the Administrators undertook a thorough assessment of all available options, including, where appropriate, potential sale of residual assets to alternative parties, with the objective of protecting value for LBIE’s stakeholders, whilst allowing the closure of the administration to proceed. A comprehensive valuation pack was produced to support the sale values, using independent market information/sources where possible. Throughout this process, the Operating Committee was kept fully informed, and provided approval for the transaction to proceed. Following the Operating Committee’s formal approval for LBIE to enter into agreements with LBH, the sale of LBIE’s residual assets to LBH was completed for cash consideration of c.£16.5m based on the Administrators’ valuation. Tax Our tax team has continued to manage LBIE’s tax position, ensuring that all necessary tax filing obligations have been met. The Administrators have met their obligations under the Senior Accounting Officer ("SAO") legislation and are no longer required to submit the certification and notification. They have complied with their obligations regarding the Lehman Group tax strategy which is no longer required to be published. They have adhered to the UK and US Foreign Account Tax Compliance Act and Common Reporting Standards. Specific progress in the reporting period includes: ? Submission of LBIE’s corporation tax return for the year ending 14 September 2024 on 19 August 2025; ? Preparation of the draft LBIE tax return for the year ending 14 September 2025; ? Recovery of £1.8m paid on account in respect of potential corporation tax to HMRC in March 2023; ? Recovery of c.$50.1m (including interest) of US tax for years 2009-2015, following competent authority approval from the IRS (as mentioned above); ? Work in respect of the transfer of assets from LBIE to LBH; and ? Surrender of 2023 tax losses to SPML & PML resulting in value to LBIE of c.£0.8m. VAT All VAT returns have been submitted up to, and including, the quarter ending 31 August 2025. Conclusion of the administration The Administrators have continued to work to wind-down the remaining LBIE infrastructure and concluded various administrative and operational matters required to enable the end of the administration and move into solvent liquidation. This included the preparation of the statement of assets and liabilities to be appended to the declaration of solvency, enabling the directors to provide the required confirmation that LBIE is solvent and to recommend to LBIE’s shareholder, LBHI2 that the Company should be placed into MVL. The declaration of solvency was signed by the Directors before a notary public. In advance of the High Court hearing held on 8 October 2025 before Justice Hildyard, the Administrators worked closely with their legal and tax advisers to finalise all necessary court evidence in support of their application for an order ending the Joint Administrators’ combined progress and final report | PwC | 5
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