Replies to post #113097 on Lehman Brothers Financial SA (LEHNQ)

[cottonisking]

Continue with Lamco:

2
STATEMENT
1. The Committee has determined to support the LAMCO transaction
proposed by the Debtors. This determination involved nearly ten months of analysis and
deliberation, including presentations to the Committee by the Debtors and a potential third party
investor. The Committee grappled with the concept of creating a non-debtor entity to manage
each Debtor’s assets outside of a plan construct, an extraordinary development not generally
consistent with creditor expectations in a liquidating chapter 11 case. However, after
comprehensive review of the proposal, the Committee has concluded that the proposed
transaction affords the Debtors’ estates an opportunity to increase the value to the Debtors’
estates for the benefit of all unsecured creditors while protecting (and, in certain respects,
enhancing) creditor control over asset management and monetization determinations.
2. The LAMCO structure offers an arrangement for the efficient
management of the Debtors’ illiquid assets, pending their future monetization (in either the short
or long term) at prices reflective of their true values. The LAMCO Agreements provide that,
even after the Debtors have emerged from chapter 11 protection, LAMCO will continue to
manage their assets “at cost” until such time as any Debtor elects to withdraw its assets from
LAMCO.2
In addition, LAMCO may attract third party assets, which LAMCO will manage at a
market rate. To the extent LAMCO succeeds in attracting such third-party clients, additional
value will inure to the Debtors’ estates and creditors.

2
The Asset Management Agreement permits LBHI to withdraw all or a portion of its Managed
Assets at any time. See Asset Management Agreement, Sections 9, 17 (attached as Exhibit C to the
Motion). The Limited Liability Company Agreement of LAMCO Holdings LLC (the “LLC Agreement”)
will be automatically amended pursuant to any confirmed plan of reorganization or liquidation of LBHI
or its affiliated debtors. See LLC Agreement, Section 19(b). The Committee anticipates, based on its
discussions with the Debtors, that if a Debtor emerges pursuant to a separate plan, the confirmation order
for such Debtor will assign withdrawal rights to the board of directors of such reorganized Debtor.

4
5. With respect to governance, the Committee is entitled to require that one
independent person be appointed as a member of the board of LAMCO Holdings, the identity of
whom is to be mutually agreed upon by LBHI and the Committee5
, and the Committee is entitled
to have its financial advisors attend all board meetings of LAMCO Holdings as observers.6

Furthermore, once the Debtors emerge from chapter 11 protection, the Committee expects that
representatives of the Debtors’ unsecured creditors will fill reorganized LBHI’s board of
directors, thus formalizing their continued control over LAMCO’s operations.
6. As to LAMCO’s operations prior to the effective date of LBHI’s plan of
reorganization, LAMCO will not be permitted to take any action which, if such action were to be
taken by LBHI, would require the approval of the Court or the Committee, without first
obtaining the approval of the Court or the Committee.7
In this regard, all of the existing
oversight protocols between the Debtors and the Committee have been incorporated into the
LAMCO governance documentation.8
The Committee will also have approval rights over
numerous LAMCO actions as well as certain LBHI actions in respect of its ownership of
LAMCO.9
Specifically, the Committee’s approval will be required before (i) LBHI invests
additional funds in LAMCO, or (ii) LAMCO is able to accept any outside investors.10
7. Finally, the Committee took great care to ensure that the LAMCO
documentation imposed on LAMCO’s management fiduciary duties equal to or greater than the

5
See LLC Agreement, Section 7(e) (attached as Exhibit E to the Motion).
6
See id. at Section 7(j).
7
See LLC Agreement, Section 7(a).
8
See Asset Management Agreement, Section 2(a).
9 See LLC Agreement, Sections 7(c)-(d).
10 See id. at Section 7(d).

Docket # 8017
Filed Apr 02 2010
Statement of Official Committee of Unsecured Creditors In Support of Debtors Motion Pursuant to Sections 105 and 363 of the Bankruptcy Code and Rule 6004(h) of the Bankruptcy Rules, for Authorization to Enter into Certain Agreements with Lamco Holdings LLC and Lamco LLC (related document(s)[7579]) filed by Dennis F. Dunne on behalf of Official Committee of Unsecured Creditors. (Dunne, Dennis) Less
Case Number 08-13555 Lehman Brothers Holdings Inc.
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Docket # 7579
Filed Mar 15 2010
Motion to Authorize / Debtors Motion, Pursuant to Sections 105(a) and 363 of the B... More
Case Number 08-13555 Lehman Brothers Holdings Inc.