Attached files
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8-K - 8-K - LEHMAN BROTHERS HOLDINGS INC. PLAN TRUST | d38701d8k.htm |
Exhibit 99.1
UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
In re:
Chapter 11 Case No. | ||
Lehman Brothers Holdings Inc., et al., | 08-13555 | |
Jointly Administered | ||
Debtors. |
QUARTERLY FINANCIAL REPORT
AS OF APRIL 2, 2020
DEBTORS ADDRESS: | LEHMAN BROTHERS HOLDINGS INC. | |
c/o KRISTINE DICKSON CHIEF FINANCIAL OFFICER | ||
277 PARK AVENUE | ||
46th FLOOR | ||
NEW YORK, NY 10172 | ||
DEBTORS ATTORNEYS: | WEIL, GOTSHAL & MANGES LLP | |
c/o JACQUELINE MARCUS, GARRETT A. FAIL | ||
767 FIFTH AVENUE | ||
NEW YORK, NY 10153 | ||
REPORT PREPARER: | LEHMAN BROTHERS HOLDINGS INC., AS PLAN ADMINISTRATOR |
Date: July 30, 2020
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Table of Contents
I. |
Schedule of Debtors |
3 | ||||
II. |
Cash Flow Estimates |
4 | ||||
III. |
Notes to the Cash Flow Estimates |
10 | ||||
Note 1 - Basis of Presentation | 10 | |||||
Note 2 - Other Receipts | 13 | |||||
Note 3 - Due from/to Non-Controlled Affiliates | 14 | |||||
Note 4 - Due from/to Debtors and Debtor-Controlled Entities | 18 | |||||
Note 5 Disputed Claims | 20 | |||||
Note 6 Legal Proceedings | 21 | |||||
Note 7 Taxes Payable | 25 | |||||
Note 8 Subsequent Events | 26 | |||||
IV. |
Balance Sheets |
27 |
QUESTIONS
The Company has established an email address to receive questions from readers regarding this presentation and its other financial disclosures. The Company plans to review questions received, and for those subjects which the Company determines a response would not (i) violate a confidentiality provision, (ii) place the Company in a competitive or negotiation disadvantage, or (iii) be unduly burdensome relative to the value of information requested, the Company shall endeavor to post a response on the website listed below (maintaining the anonymity of the originators of the questions). The Company assumes no obligation to respond to email inquiries.
Please email questions, with document references as relevant, to:
QUESTIONS@lehmanholdings.com
The Companys previously posted responses can be found on the Epiq website maintained for the Company:
www.lehman-docket.com under the Key Documents tab and the Responses to Questions Submitted category
Page 2
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Quarterly Financial Report as of April 2, 2020 (Unaudited)
I. | Schedule of Debtors |
The twenty three entities listed below (the Debtors) filed for bankruptcy in the United States Bankruptcy Court for the Southern District of New York (the Bankruptcy Court) on the dates indicated below. On December 6, 2011, the Bankruptcy Court confirmed the Modified Third Amended Joint Chapter 11 Plan of Lehman Brothers Holdings Inc. and its Affiliated Debtors (the Plan). On March 6, 2012, the Effective Date (as defined in the Plan) occurred. As of the date hereof, the following Debtors chapter 11 cases remain open:
Case No. | Date Filed (Commencement Date) | |||
Lehman Brothers Holdings Inc. (LBHI) |
08-13555 | 9/15/2008 | ||
Lehman Brothers Special Financing Inc. (LBSF) |
08-13888 | 10/3/2008 |
The following Debtors chapter 11 cases were closed in 2016, 2018, 2019 and 2020, pursuant to final decrees entered by the Bankruptcy Court (Docket No. 51920, No. 54163, No. 58257, No. 59472 and No. 60623):
Case No. | Date Filed | Date Closed | ||||||||||
LB 745 LLC |
08-13600 | 09/16/2008 | 01/28/2016 | |||||||||
PAMI Statler Arms LLC |
08-13664 | 09/23/2008 | 01/28/2016 | |||||||||
CES Aviation LLC |
08-13905 | 10/05/2008 | 01/28/2016 | |||||||||
CES Aviation V LLC |
08-13906 | 10/05/2008 | 01/28/2016 | |||||||||
CES Aviation IX LLC |
08-13907 | 10/05/2008 | 01/28/2016 | |||||||||
LB 2080 Kalakaua Owners LLC |
09-12516 | 04/23/2009 | 01/28/2016 | |||||||||
LB Somerset LLC |
09-17503 | 12/22/2009 | 01/28/2016 | |||||||||
LB Preferred Somerset LLC |
09-17505 | 12/22/2009 | 01/28/2016 | |||||||||
East Dover Limited |
08-13908 | 10/05/2008 | 12/15/2016 | |||||||||
Luxembourg Residential Properties Loan Finance S.a.r.l. |
09-10108 | 01/07/2009 | 12/15/2016 | |||||||||
Merit LLC |
09-17331 | 12/14/2009 | 12/15/2016 | |||||||||
Lehman Brothers Derivative Products Inc. (LBDP) |
08-13899 | 10/05/2008 | 06/14/2018 | |||||||||
Lehman Brothers Financial Products Inc. (LBFP) |
08-13902 | 10/05/2008 | 06/14/2018 | |||||||||
Lehman Scottish Finance L.P. |
08-13904 | 10/05/2008 | 06/14/2018 | |||||||||
LB Rose Ranch LLC |
09-10560 | 02/09/2009 | 06/14/2018 | |||||||||
Lehman Brothers Commodity Services Inc. (LBCS) |
08-13902 | 10/03/2008 | 02/11/2019 | |||||||||
Lehman Brothers Commercial Corporation (LBCC) |
08-13901 | 10/05/2008 | 02/11/2019 | |||||||||
Structured Asset Securities Corporation |
09-10558 | 02/09/2009 | 02/11/2019 | |||||||||
Lehman Brothers OTC Derivatives Inc. (LOTC) |
08-13893 | 10/03/2008 | 05/04/2020 | |||||||||
Lehman Brothers Commercial Paper Inc. (LCPI) |
08-13900 | 10/05/2008 | 05/04/2020 | |||||||||
BNC Mortgage LLC |
09-10137 | 01/09/2009 | 05/04/2020 |
Page 3
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Quarterly Financial Report as of April 2, 2020 (Unaudited)
II. | Cash Flow Estimates |
Lehman Brothers Holdings Inc. & Debtor-Controlled Entities
($ in millions) | LBHI As of 12/31/19 |
Debtor- Controlled 12.31.19 |
LBHI & Debtor- Controlled 12.31.19 |
Cash Activity 1/1/204/2/20 |
Estimate Changes |
Transfers, Reclassifications, Adjustments (e) |
As of 04/02/20 |
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CASH AND INVESTMENTS |
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Reserves for Claims |
$ | 50 | $ | | $ | 50 | $ | | $ | (4 | ) | $ | | $ | 46 | |||||||||||||||||
Reserves for Operating Expenses, Incentive Fees, and Other |
183 | 17 | 200 | (27 | ) | 24 | (75 | ) | 123 | |||||||||||||||||||||||
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Total Cash & Investments - Restricted |
233 | 17 | 250 | (27 | ) | 20 | (75 | ) | 169 | |||||||||||||||||||||||
Total Cash & Investments - Unrestricted |
23 | 73 | 96 | 72 | (20 | ) | | 148 | ||||||||||||||||||||||||
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TOTAL CASH AND INVESTMENTS [A] |
$ | 256 | $ | 91 | $ | 346 | $ | 46 | $ | | $ | (75 | ) | $ | 317 | |||||||||||||||||
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CASH FLOW ESTIMATES |
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Net Receipts |
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Financial Instruments |
$ | 5 | $ | 32 | $ | 36 | $ | (11 | ) | $ | 7 | $ | 6 | $ | 38 | |||||||||||||||||
Other |
Note 2 | 74 | 3 | 77 | (4 | ) | (2 | ) | 3 | 74 | ||||||||||||||||||||||
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Sub-Total - Net Receipts |
79 | 34 | 113 | (15 | ) | 5 | 8 | 112 | ||||||||||||||||||||||||
Recoveries From Non-Controlled Affiliates |
Note 3 | |||||||||||||||||||||||||||||||
Europe |
319 | 897 | 1,215 | (82 | ) | 12 | 0 | 1,145 | ||||||||||||||||||||||||
Asia |
55 | | 55 | | (5 | ) | | 50 | ||||||||||||||||||||||||
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Sub-Total - Recoveries From Non-Controlled Affiliates |
373 | 897 | 1,270 | (82 | ) | 7 | 0 | 1,195 | ||||||||||||||||||||||||
Recoveries From Controlled Affiliates |
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Pre-Petition Intercompany Receipts (a) |
Note 4 | 114 | (49 | ) | 65 | (62 | ) | 2 | | 5 | ||||||||||||||||||||||
Net Post-Petition Intercompany Receipts from / (Payables to) (b) |
(79 | ) | 82 | 3 | (2 | ) | 1 | | 2 | |||||||||||||||||||||||
Investments in Affiliates (c) |
959 | (958 | ) | 2 | | 0 | | 2 | ||||||||||||||||||||||||
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Sub-Total - Recoveries From Controlled Affiliates |
994 | (924 | ) | 70 | (64 | ) | 4 | | 9 | |||||||||||||||||||||||
Operating Expenses and Incentive Fees |
(121 | ) | (3 | ) | (124 | ) | 27 | (23 | ) | (3 | ) | (123 | ) | |||||||||||||||||||
Estimated Taxes Payable |
Note 7 | (34 | ) | (2 | ) | (36 | ) | | 4 | (5 | ) | (37 | ) | |||||||||||||||||||
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TOTAL CASH FLOW FROM OPERATIONS + OTHER RECEIPTS [B] |
$ | 1,291 | $ | 2 | $ | 1,293 | $ | (135 | ) | $ | (3 | ) | $ | 1 | $ | 1,156 | ||||||||||||||||
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OTHER ADJUSTMENTS |
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(Less): Cash held for the benefit of third parties (d), (e) |
$ | (89 | ) | $ | (93 | ) | $ | (182 | ) | $ | | $ | 71 | $ | 75 | $ | (36 | ) | ||||||||||||||
Plus/(Less): Plan Adjustments from/(to) Participatory Debtors |
7 | | 7 | (7 | ) | 0 | | 1 | ||||||||||||||||||||||||
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TOTAL OTHER ADJUSTMENTS [C] |
$ | (82 | ) | $ | (93 | ) | $ | (175 | ) | $ | (7 | ) | $ | 71 | $ | 75 | $ | (36 | ) | |||||||||||||
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ESTIMATED CASH AVAILABLE FOR DISTRIBUTIONS [A+B+C] |
$ | 1,465 | $ | (0 | ) | $ | 1,465 | $ | (96 | ) | $ | 68 | $ | 1 | $ | 1,438 | ||||||||||||||||
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(a) | As of April 2, 2020, Debtor-Controlled Entities have been consolidated with LBHI for reporting purposes. |
(b) | Aurora Commercial Corp. (formerly known as Aurora Bank FSB) (Aurora) is a wholly-owned subsidiary of Lehman Brothers Bancorp Inc. (LBB), which is a wholly-owned subsidiary of LBHI. As of April 2, 2020, LBHI had an intercompany loan due to Aurora of $69 million. On March 24, 2019, Aurora and its subsidiary Aurora Loan Services (together, the Aurora Debtors) filed chapter 11 petitions in the Bankruptcy Court. On March 31, 2020, the Aurora Debtors filed their Joint Plan of Liquidation and the Disclosure Statement related thereto [Docket Nos. 378 and 379]. On May 28, 2020, the Bankruptcy Court confirmed the Modified First Amended Joint Plan of Liquidation for the Aurora Debtors [Docket No. 464]. Additional information and filings in the cases can be found at https://cases.primeclerk.com/Aurora/. |
(c) | The Company estimates that LBHI will receive approximately $0.8 billion related to Investments in Affiliates, primarily from Lehman Brothers Holdings Scottish LP 2 (SLP2). SLP2 is the parent company of Lehman Brothers Holdings Scottish LP 3 (SLP3) and is wholly owned by LBHI. Estimate Changes include the impact of movements in foreign exchange rates during the period. |
(d) | Amounts excluded from Cash Available for Distributions include Distributions on Allowed Claims (not remitted) and other items. |
(e) | On December 27, 2019, LBHI and LCPI executed a sale and purchase agreement pursuant to which LBHI agreed to purchase LCPIs remaining assets and certain obligations for total consideration of $63.2 million. On December 20, 2019, LBHI and LBSF executed a sale and purchase agreement pursuant to which LBHI agreed to purchase LBSFs Allowed Claims into LBHI for total consideration of $17.7 million. These transactions were effective in January 2020. |
Page 4
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Quarterly Financial Report as of April 2, 2020 (Unaudited)
Lehman Brothers Special Financing Inc.
($ in millions) | As of 12/31/19 |
Cash Activity 1/1/20 - 4/2/20 |
Estimate Changes |
Transfers, Reclassifications, Adjustments (a) |
As of 04/02/20 |
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CASH AND INVESTMENTS |
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Reserves for Claims |
$ | 2 | $ | | $ | 1 | $ | | 3 | |||||||||||||||
Reserves for Operating Expenses, Incentive Fees, and Other |
7 | (1 | ) | (3 | ) | | 3 | |||||||||||||||||
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Total Cash & Investments - Restricted |
10 | (1 | ) | (2 | ) | | 6 | |||||||||||||||||
Total Cash & Investments - Unrestricted |
7 | (23 | ) | 2 | 18 | 4 | ||||||||||||||||||
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TOTAL CASH AND INVESTMENTS [A] |
$ | 16 | $ | (24 | ) | $ | | $ | 18 | 10 | ||||||||||||||
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CASH FLOW ESTIMATES |
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Net Receipts |
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Financial Instruments |
$ | 7 | $ | (1 | ) | $ | 0 | $ | | 7 | ||||||||||||||
Other |
Note 2 | 5 | (0 | ) | (2 | ) | (3 | ) | 1 | |||||||||||||||
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Sub-Total - Net Receipts |
12 | (1 | ) | (1 | ) | (3 | ) | 8 | ||||||||||||||||
Recoveries From Non-Controlled Affiliates |
Note 3 | |||||||||||||||||||||||
Europe |
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Asia |
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Sub-Total - Recoveries From Non-Controlled Affiliates |
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Recoveries From Controlled Affiliates |
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Pre-Petition Intercompany Receipts |
Note 4 | 17 | (2 | ) | 0 | (15 | ) | | ||||||||||||||||
Net Post-Petition Intercompany Receipts from / (Payables to) |
(1 | ) | | (1 | ) | | (3 | ) | ||||||||||||||||
Investments in Affiliates |
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Sub-Total - Recoveries From Controlled Affiliates |
16 | (2 | ) | (1 | ) | (15 | ) | (3 | ) | |||||||||||||||
Operating Expenses and Incentive Fees |
(8 | ) | 1 | 3 | | (4 | ) | |||||||||||||||||
Estimated Taxes Payable |
Note 7 | | | | | | ||||||||||||||||||
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TOTAL CASH FLOW FROM OPERATIONS + OTHER RECEIPTS [B] |
$ | 20 | $ | (2 | ) | $ | 1 | $ | (18 | ) | 1 | |||||||||||||
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OTHER ADJUSTMENTS |
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(Less): Cash held for the benefit of third parties |
$ | (0 | ) | $ | | $ | (0 | ) | $ | | (0 | ) | ||||||||||||
Plus/(Less): Plan Adjustments from/(to) Participatory Debtors |
(2 | ) | 2 | (0 | ) | | (1 | ) | ||||||||||||||||
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TOTAL OTHER ADJUSTMENTS [C] |
$ | (2 | ) | $ | 2 | $ | (1 | ) | $ | | (1 | ) | ||||||||||||
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ESTIMATED CASH AVAILABLE FOR DISTRIBUTIONS [A+B+C] |
$ | 34 | $ | (24 | ) | $ | 0 | $ | (0 | ) | 10 | |||||||||||||
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(a) | On December 20, 2019, LBHI and LBSF executed a sale and purchase agreement pursuant to which LBHI agreed to purchase LBSFs Allowed Claims into LBHI for total consideration of $17.7 million. This transaction was effective in January 2020, and the proceeds were included in D20. |
Page 5
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Quarterly Financial Report as of April 2, 2020 (Unaudited)
Lehman Commercial Paper Inc.
($ in millions) | As of 12/31/19 |
Cash Activity 1/1/20 -4/2/20 |
Estimate Changes |
Transfers, Reclassifications, Adjustments (a) |
As of 04/02/20 |
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CASH AND INVESTMENTS |
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Reserves for Claims |
$ | 2 | $ | | $ | (2 | ) | $ | | $ | 0 | |||||||||||||
Reserves for Operating Expenses, Incentive Fees, and Other |
3 | | (3 | ) | | | ||||||||||||||||||
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Total Cash & Investments - Restricted |
4 | | (4 | ) | | 0 | ||||||||||||||||||
Total Cash & Investments - Unrestricted |
2 | (64 | ) | 4 | 57 | | ||||||||||||||||||
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TOTAL CASH AND INVESTMENTS [A] |
$ | 7 | $ | (64 | ) | $ | | $ | 57 | 0 | ||||||||||||||
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CASH FLOW ESTIMATES |
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Net Receipts |
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Financial Instruments |
$ | 6 | $ | (0 | ) | $ | 0 | $ | (6 | ) | | |||||||||||||
Other |
Note 2 | | (0 | ) | 0 | | | |||||||||||||||||
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Sub-Total - Net Receipts |
6 | (0 | ) | 0 | (6 | ) | | |||||||||||||||||
Recoveries From Non-Controlled Affiliates |
Note 3 | |||||||||||||||||||||||
Europe |
0 | | | (0 | ) | | ||||||||||||||||||
Asia |
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Sub-Total - Recoveries From Non-Controlled Affiliates |
0 | | | (0 | ) | | ||||||||||||||||||
Recoveries From Controlled Affiliates |
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Pre-Petition Intercompany Receipts |
Note 4 | 57 | | (0 | ) | (57 | ) | | ||||||||||||||||
Net Post-Petition Intercompany Receipts from / (Payables to) |
(2 | ) | 2 | 0 | | 0 | ||||||||||||||||||
Investments in Affiliates |
1 | | | (1 | ) | | ||||||||||||||||||
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Sub-Total - Recoveries From Controlled Affiliates |
56 | 2 | (0 | ) | (58 | ) | 0 | |||||||||||||||||
Operating Expenses and Incentive Fees |
(3 | ) | | | 3 | | ||||||||||||||||||
Estimated Taxes Payable |
Note 7 | (5 | ) | | | 5 | | |||||||||||||||||
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TOTAL CASH FLOW FROM OPERATIONS + OTHER RECEIPTS [B] |
$ | 54 | $ | 2 | $ | 0 | $ | (56 | ) | 0 | ||||||||||||||
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OTHER ADJUSTMENTS |
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(Less): Cash held for the benefit of third parties |
$ | (1 | ) | $ | | $ | 1 | $ | | (0 | ) | |||||||||||||
Plus/(Less): Plan Adjustments from/(to) Participatory Debtors |
(5 | ) | 5 | (0 | ) | | | |||||||||||||||||
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TOTAL OTHER ADJUSTMENTS [C] |
$ | (6 | ) | $ | 5 | $ | 1 | $ | | (0 | ) | |||||||||||||
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ESTIMATED CASH AVAILABLE FOR DISTRIBUTIONS [A+B+C] |
$ | 55 | $ | (57 | ) | $ | 1 | $ | 1 | 0 | ||||||||||||||
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(a) | On December 27, 2019, LBHI and LCPI executed a sale and purchase agreement pursuant to which LBHI agreed to purchase LCPIs remaining assets and certain obligations for total consideration of $63.2 million. This transaction was effective in January 2020, and the proceeds were included in D20. |
The Bankruptcy Court entered the final decree to close the bankruptcy case for Lehman Commercial Paper Inc. on May 4, 2020 (Docket No. 60623).
Page 6
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Quarterly Financial Report as of April 2, 2020 (Unaudited)
Lehman Brothers OTC Derivatives Inc.
($ in millions) | As of 12/31/19 |
Cash Activity 1/1/20 -4/2/20 |
Estimate Changes |
Transfers, Reclassifications, Adjustments |
As of 04/02/20 |
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CASH AND INVESTMENTS |
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Reserves for Claims |
$ | | $ | | $ | 0 | $ | | $ | 0 | ||||||||||||||
Reserves for Operating Expenses, Incentive Fees, and Other |
0 | | (0 | ) | | | ||||||||||||||||||
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Total Cash & Investments - Restricted |
0 | | (0 | ) | | 0 | ||||||||||||||||||
Total Cash & Investments - Unrestricted |
0 | (0 | ) | 0 | | 0 | ||||||||||||||||||
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TOTAL CASH AND INVESTMENTS [A] |
$ | 0 | $ | (0 | ) | $ | | $ | | $ | 0 | |||||||||||||
CASH FLOW ESTIMATES |
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Net Receipts |
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Financial Instruments |
$ |
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$ |
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Other |
Note 2 | | | | | | ||||||||||||||||||
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Sub-Total - Net Receipts |
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Recoveries From Non-Controlled Affiliates |
Note 3 | |||||||||||||||||||||||
Europe |
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Asia |
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Sub-Total - Recoveries From Non-Controlled Affiliates |
| | | | | |||||||||||||||||||
Recoveries From Controlled Affiliates |
||||||||||||||||||||||||
Pre-Petition Intercompany Receipts |
Note 4 | | | | | | ||||||||||||||||||
Net Post-Petition Intercompany Receipts from / (Payables to) |
(0 | ) | 0 | | | | ||||||||||||||||||
Investments in Affiliates |
| | | | | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Sub-Total - Recoveries From Controlled Affiliates |
(0 | ) | 0 | | | | ||||||||||||||||||
Operating Expenses and Incentive Fees |
| | | | | |||||||||||||||||||
Estimated Taxes Payable |
Note 7 | | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
TOTAL CASH FLOW FROM OPERATIONS + OTHER RECEIPTS [B] |
$ | (0 | ) | $ | 0 | $ | | $ | | $ | | |||||||||||||
OTHER ADJUSTMENTS |
||||||||||||||||||||||||
(Less): Cash held for the benefit of third parties |
$ | | $ | | $ | | $ | | $ | | ||||||||||||||
Plus/(Less): Plan Adjustments from/(to) Participatory Debtors |
| | | | | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
TOTAL OTHER ADJUSTMENTS [C] |
$ | | $ | | $ | | $ | | $ | | ||||||||||||||
ESTIMATED CASH AVAILABLE FOR DISTRIBUTIONS [A+B+C] |
$ | (0 | ) | $ | 0 | $ | | $ | | $ | 0 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
The Bankruptcy Court entered the final decree to close the bankruptcy case for Lehmann Brothers OTC Derivatives Inc. on May 4, 2020 (Docket No. 60623).
Page 7
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
BNC Mortgage LLC
($ in millions) | As of 12/31/19 |
Cash Activity 1/1/20 -4/2/20 |
Estimate Changes |
Transfers, Reclassifications, Adjustments |
As of 04/02/20 |
|||||||||||||||||||
CASH AND INVESTMENTS |
||||||||||||||||||||||||
Reserves for Claims |
$ | 0 | $ | | $ | (0 | ) | $ | | $ | | |||||||||||||
Reserves for Operating Expenses, Incentive Fees, and Other |
0 | | (0 | ) | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total Cash & Investments - Restricted |
0 | | (0 | ) | | | ||||||||||||||||||
Total Cash & Investments - Unrestricted |
2 | 0 | 0 | | 2 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
TOTAL CASH AND INVESTMENTS [A] |
$ | 2 | $ | 0 | $ | | $ | | $ | 2 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
CASH FLOW ESTIMATES |
||||||||||||||||||||||||
Net Receipts |
||||||||||||||||||||||||
Financial Instruments |
$ | | $ | | $ | | $ | | $ | | ||||||||||||||
Other |
Note 2 | | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Sub-Total - Net Receipts |
| | | | | |||||||||||||||||||
Recoveries From Non-Controlled Affiliates |
Note 3 | |||||||||||||||||||||||
Europe |
| | | | | |||||||||||||||||||
Asia |
| | | | | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Sub-Total - Recoveries From Non-Controlled Affiliates |
| | | | | |||||||||||||||||||
Recoveries From Controlled Affiliates |
||||||||||||||||||||||||
Pre-Petition Intercompany Receipts |
Note 4 | | | | | | ||||||||||||||||||
Net Post-Petition Intercompany Receipts from / (Payables to) |
0 | | (0 | ) | | 0 | ||||||||||||||||||
Investments in Affiliates |
| | | | | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Sub-Total - Recoveries From Controlled Affiliates |
0 | | (0 | ) | | 0 | ||||||||||||||||||
Operating Expenses and Incentive Fees |
| | | | | |||||||||||||||||||
Estimated Taxes Payable |
Note 7 | | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
TOTAL CASH FLOW FROM OPERATIONS + OTHER RECEIPTS [B] |
$ | 0 | $ | | $ | (0 | ) | $ | | $ | 0 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
OTHER ADJUSTMENTS |
||||||||||||||||||||||||
(Less): Cash held for the benefit of third parties |
$ | (0 | ) | $ | | $ | 0 | $ | | $ | | |||||||||||||
Plus/(Less): Plan Adjustments from/(to) Participatory Debtors |
| | | | | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
TOTAL OTHER ADJUSTMENTS [C] |
$ | (0 | ) | $ | | $ | 0 | $ | | $ | | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
ESTIMATED CASH AVAILABLE FOR DISTRIBUTIONS [A+B+C] |
$ | 2 | $ | 0 | $ | 0 | $ | | $ | 2 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
The Bankruptcy Court entered the final decree to close the bankruptcy case for BNC Mortgage LLC on May 4, 2020 (Docket No. 60623).
Page 8
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Estimated Remaining Creditor Recoveries, By Debtor
The following schedules show the estimated remaining recoveries for each of LBHI and LBSF by claim class, based on the Estimated Cash Available for Distributions in the preceding tables. The estimated remaining recoveries on the previous pages and the schedules below do not include (a) potential recoveries from the Excluded Litigations, and (b) estimates for potential allowed amounts of disputed claims.
($ in millions)
Lehman Brothers Holdings Inc.
Allowed Claims Eligible for Distributions (1) |
Estimated Remaining Recovery |
Estimated Remaining Recovery % as of 04.02.2020 |
Actual Recovery % Thru D20 |
Estimated End of Case Recovery % |
||||||||||||||||||
Class |
Designation |
$ | $ | A | B | = A + B | ||||||||||||||||
3 |
Senior Unsecured |
$ | 82,542 | $ | 737 | 0.893 | % | 46.049 | % | 46.942 | % | |||||||||||
4A |
Senior Affiliate Claims |
33,571 | 267 | 0.797 | % | 37.052 | % | 37.848 | % | |||||||||||||
4B |
Senior Affiliate Guarantee |
10,463 | 82 | 0.779 | % | 36.154 | % | 36.933 | % | |||||||||||||
5 |
Senior Third-Party Guarantee |
31,707 | 198 | 0.623 | % | 28.928 | % | 29.551 | % | |||||||||||||
7 |
General Unsecured |
5,242 | 43 | 0.829 | % | 43.113 | % | 43.941 | % | |||||||||||||
8 |
Derivative Affiliate / Affiliate Guarantee Claims |
451 | 3 | 0.732 | % | 34.041 | % | 34.773 | % | |||||||||||||
9A |
Third Party Guarantee Derivatives |
18,261 | 107 | 0.586 | % | 27.230 | % | 27.816 | % | |||||||||||||
9B |
Third Party Guarantee Derivatives RACERs |
| | 0.356 | % | 16.555 | % | 16.911 | % | |||||||||||||
10A |
Subordinated Class 10A Claims |
3,399 | | | | | ||||||||||||||||
10B |
Subordinated Class 10B Claims |
10,330 | | | | | ||||||||||||||||
10C |
Subordinated Class 10C Claims |
1,493 | | | | | ||||||||||||||||
|
|
|
|
|||||||||||||||||||
Total | $ | 197,460 | $ | 1,438 | ||||||||||||||||||
|
|
|
|
Lehman Brothers Special Financing Inc.
Allowed Claims Eligible for Distributions (1) |
Estimated Remaining Recovery |
Estimated Remaining Recovery % as of 04.02.2020 |
Actual Recovery % Thru D20 |
Estimated End of Case Recovery % |
||||||||||||||||||
Class |
Designation |
$ | $ | A | B | = A + B | ||||||||||||||||
4A |
GUC not Designated Entities |
$ | 19,675 | $ | 5 | 0.025 | % | 40.365 | % | 40.391 | % | |||||||||||
4B |
GUC Designated Entities |
1,948 | 0 | 0.013 | % | 20.467 | % | 20.480 | % | |||||||||||||
5A |
Affiliate Claims of LBHI |
15,173 | 4 | 0.027 | % | 40.954 | % | 40.981 | % | |||||||||||||
5B |
Affiliate Claims of Participating Subs |
522 | 0 | 0.022 | % | 33.650 | % | 33.671 | % | |||||||||||||
5C |
Affiliate claims |
1,689 | 0 | 0.025 | % | 39.864 | % | 39.890 | % | |||||||||||||
|
|
|
|
|||||||||||||||||||
Total | $ | 39,006 | $ | 10 | ||||||||||||||||||
|
|
|
|
(1) | Estimated Recovery percentages are calculated based on recoveries of Allowed Claims Eligible for Distributions as reported on Exhibit D of the 20th Distribution Notice filed on March 26, 2020 [Docket No. 60487]. For purposes of this illustrative calculation only: |
a. | Allowed claims exclude (i) claims against LBHI satisfied in full through the combination of the primary obligor and guarantee distributions from LBHI, and (ii) previously Allowed Claims that have been withdrawn. |
b. | Disputed claims are assumed to be allowed at zero, and all cash reserves currently held on behalf of holders of disputed claims are assumed to be released for the benefit of all holders of Allowed Claims. |
c. | Allowed Claims Eligible for Distributions exclude Allowed Claims that each Debtor owns against itself. |
(2) | Through D20, the Debtors have made distributions to creditors totaling $128.1 billion, of which $95.2 billion were payments on account of claims owned or formerly owned by third party creditors. |
Page 9
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
III. Notes to the Cash Flow Estimates
Note 1 Basis of Presentation
Page 10
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 1 Basis of Presentation (continued)
Page 11
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 1 Basis of Presentation (continued)
Page 12
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 2 Other Receipts
The following table summarizes the main components of Other Receipts as of April 2, 2020:
Debtors | Debtor- | |||||||||||
$ in millions |
LBHI | LBSF | Controlled Entities |
|||||||||
Affiliate Claims (1) |
71 | | 0 | |||||||||
Other |
1 | 1 | 3 |
Note: Totals may not foot due to rounding.
(1) | Includes $71 million of claims, marked at estimated recovery values, against Non-Controlled Affiliates acquired through settlements with third parties valued at estimated recoveries, net of distributions. The largest component of Affiliate Claims is an admitted claim, prior to distributions, against Lehman Brothers Limited for £66 million. |
Page 13
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 3 Due from/to Non-Controlled Affiliates
The following table presents, on an aggregate basis for LBHI and Debtor-Controlled Entities, admitted claims (including statutory interest to date), collections to date from Non-Controlled Affiliates, and aggregate estimated remaining recoveries (including statutory interest):
Estimated Recoveries (4) |
||||||||||||||||||||||||||||
$ in millions |
Local Currency |
Admitted Claims in Local Currency (2) |
Collections To Date in Local Currency (2) |
Admitted and Unsettled Filed Claims in USD (3) |
Collections To Date in USD (2) |
Net Receivables in USD |
LBHI & Debtor- Controlled Entities |
|||||||||||||||||||||
Europe |
||||||||||||||||||||||||||||
Lehman Brothers Finance S.A. |
CHF | 10,153 | (2,087 | ) | 10,421 | (2,142 | ) | 8,280 | ||||||||||||||||||||
Lehman Brothers Holdings Intermediate 2 Ltd |
GBP | 871 | (871 | ) | 1,873 | (1,080 | ) | 793 | ||||||||||||||||||||
Thayer Properties Limited |
GBP | 172 | (92 | ) | 213 | (115 | ) | 98 | ||||||||||||||||||||
LB (PTG) Ltd |
GBP | 170 | (91 | ) | 211 | (112 | ) | 98 | ||||||||||||||||||||
LB ODC 3 |
GBP | 101 | (62 | ) | 125 | (77 | ) | 49 | ||||||||||||||||||||
Other |
2,293 | (2,251 | ) | 42 | ||||||||||||||||||||||||
Recoveries of Prior Guarantee Distributions (1) |
| | | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Europe |
15,136 | (5,776 | ) | 9,360 | 1,145 | |||||||||||||||||||||||
Asia |
||||||||||||||||||||||||||||
LB Commercial Corp. Asia Limited |
HKD | 14,769 | (9,118 | ) | 1,905 | (1,176 | ) | 729 | ||||||||||||||||||||
LB Asia Pacific (Singapore) PTE |
USD | 621 | (364 | ) | 621 | (364 | ) | 258 | ||||||||||||||||||||
LB Investments PTE Ltd |
USD | 536 | (342 | ) | 536 | (342 | ) | 194 | ||||||||||||||||||||
LB RE Australia Commerical PTY LTD |
AUD | 218 | (66 | ) | 132 | (40 | ) | 92 | ||||||||||||||||||||
LB Australia Holdings PTY LTD |
AUD | 145 | (63 | ) | 88 | (38 | ) | 50 | ||||||||||||||||||||
Lehman Brothers Australia Ltd |
AUD | 111 | (66 | ) | 67 | (40 | ) | 27 | ||||||||||||||||||||
Other |
11,082 | (11,045 | ) | 37 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Asia |
14,433 | (13,046 | ) | 1,387 | 50 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total |
$ | 29,569 | $ | (18,821 | ) | $ | 10,747 | $ | 1,195 | |||||||||||||||||||
|
|
|
|
|
|
|
|
Totals may not foot due to rounding
(1) | The Companys Estimated Recoveries include estimates for recoveries related to prior distributions on Allowed Guarantee Claims against LBHI that are or are expected to be satisfied in full. |
(2) | Admitted Claims in Local Currency, Collections to Date in Local Currency and Collections to Date in USD include statutory interest received to date less any distributions received on the claims prior to the assignments of the claims to LBHI and/or Debtor-Controlled Entities. |
(3) | Admitted and Unsettled Filed Claims in USD includes estimated recoveries on subordinated receivables and statutory interest. |
(4) | Refer to Note 1 Basis of Presentation herein for further information on the estimated recoveries from Non-Controlled Affiliates. |
(5) | Other claims against Lehman Brothers Finance S.A., Bankhaus, and LBIE acquired through settlements with third parties are included in Other Assets (refer to Note 2 Other Receipts for additional information). |
Page 14
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 3 Due from/to Non-Controlled Affiliates (continued)
The table below presents the Due from/to Non-Controlled Affiliates balances as of April 2, 2020, and the related activity since the previously filed Quarterly Financial Report as of December 31, 2019:
Activity 01/01/20 - 04/02/20 | ||||||||||||||||||||||||
$ in millions | As of December 31, 2019 |
Cash Receipts |
Cash Distributions |
Claim Assignments |
Other (1) | As of April 2, 2020 |
||||||||||||||||||
Due From Non-Controlled |
||||||||||||||||||||||||
Debtors: |
||||||||||||||||||||||||
Lehman Brothers Holdings Inc. |
$ | 10,136 | $ | (82 | ) | $ | | $ | 0 | $ | (112 | ) | $ | 9,943 | ||||||||||
Lehman Commercial Paper Inc. |
1 | | (0 | ) | (0 | ) | 0 | |||||||||||||||||
Lehman Brothers Special Financing Inc. |
(0 | ) | | | 0 | (0 | ) | |||||||||||||||||
Debtor-Controlled |
818 | | | (14 | ) | 804 | ||||||||||||||||||
Due To Non-Controlled (2) |
||||||||||||||||||||||||
Debtors: |
||||||||||||||||||||||||
Lehman Brothers Holdings Inc. |
$ | 28,885 | $ | | $ | (23 | ) | $ | | $ | | $ | 28,861 | |||||||||||
Lehman Commercial Paper Inc. |
435 | | (5 | ) | | (429 | ) | | ||||||||||||||||
Lehman Brothers Special Financing Inc. |
772 | | (1 | ) | (0 | ) | (0 | ) | 770 | |||||||||||||||
Debtor-Controlled |
29 | | | 1 | 0 | 30 |
(1) | Other includes (i) the write-off of $429 million related to the closing of LCPIs bankruptcy case, and (ii) $154 million resulting from the negative impact of movements in foreign exchange rates for the period calculated on the historical net receivable balances. |
(2) | Due to Non-Controlled balances from Debtors are included in Liabilties Subject to Compromise herein. |
Page 15
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 3 Due from/to Non-Controlled Affiliates (continued)
The following table presents a summary of Due from/to Non-Controlled Affiliates balances as of April 2, 2020:
LBHI | LBSF | Debtor-Controlled Entities |
||||||||||||||||||||||
$ in millions |
Due from | Due to | Due from | Due to | Due from | Due to | ||||||||||||||||||
Europe |
||||||||||||||||||||||||
Lehman Brothers Treasury Co B.V. (1) |
$ | | $ | (12,351 | ) | $ | | $ | | $ | | $ | | |||||||||||
Lehman Brothers Finance S.A. |
8,280 | (670 | ) | | | | | |||||||||||||||||
Thayer Properties Limited |
98 | | | | | | ||||||||||||||||||
LB (PTG) Ltd |
98 | | | | | | ||||||||||||||||||
Lehman Brothers Limited |
1 | (232 | ) | | (2 | ) | | (0 | ) | |||||||||||||||
Lehman Brothers International (Europe) (2) |
37 | (650 | ) | | (518 | ) | | (1 | ) | |||||||||||||||
Eldon Street Holdings Limited |
| (19 | ) | | | | | |||||||||||||||||
LB Holdings Intermediate 2 Ltd |
| (196 | ) | | | 793 | | |||||||||||||||||
Wood Street Investments Ltd |
| (174 | ) | | | | | |||||||||||||||||
Storm Funding Ltd |
(0 | ) | (113 | ) | | (3 | ) | | | |||||||||||||||
Asia |
||||||||||||||||||||||||
LB Commercial Corp. Asia Limited |
729 | | | | | | ||||||||||||||||||
LB Asia Pacific (Singapore) PTE |
258 | | | | | | ||||||||||||||||||
LB Investments PTE Ltd |
194 | | | | | | ||||||||||||||||||
Other |
||||||||||||||||||||||||
Claims held by third parties (3) |
| (14,385 | ) | | (180 | ) | | | ||||||||||||||||
Other |
248 | (71 | ) | (0 | ) | (67 | ) | 11 | (28 | ) |
(1) | LBT is included in the defined term Non-Controlled Affiliates, but LBHI has no direct or indirect equity interest in LBT. |
(2) | LBHI owns allowed claims against LBIE in the aggregate face amount of £646 million. |
(3) | Claims held by third parties represent claims against Debtors, net of distributions, originally held by Non-Controlled Affiliates, according to their respective settlement agreements with the Company, that are currently held by third parties. |
Page 16
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 3 Due from/to Non-Controlled Affiliates (continued)
Page 17
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 4 Due from/to Debtors and Debtor-Controlled Entities
The table below presents the Due from/to Debtors and Debtor-Controlled Entities balances as of April 2, 2020, and the related activity since the previously filed Quarterly Financial Report as of December 31, 2019:
Activity 01/01/2004/02/20 | ||||||||||||||||||||||||
$ in millions | As of December 31, 2019 |
Cash Receipts |
Cash Distributions |
Claim Assignments (1) |
Other(2) | As of April 2, 2020 |
||||||||||||||||||
Due From Controlled |
||||||||||||||||||||||||
Debtors: |
||||||||||||||||||||||||
Lehman Brothers Holdings Inc. |
$ | 18,895 | (70 | ) | $ | | $ | 3,038 | $ | (2,779 | ) | $ | 19,083 | |||||||||||
Lehman Commercial Paper Inc. |
5,912 | | | (5,912 | ) | | | |||||||||||||||||
Lehman Brothers Special Financing Inc. |
1,014 | (2 | ) | | (837 | ) | (175 | ) | 0 | |||||||||||||||
Debtor-Controlled |
0 | 0 | 1 | |||||||||||||||||||||
Due To Controlled (3) |
||||||||||||||||||||||||
Debtors: |
||||||||||||||||||||||||
Lehman Brothers Holdings Inc. |
$ | 3,789 | $ | | (3,789 | ) | $ | (0 | ) | $ | (0 | ) | ||||||||||||
Lehman Commercial Paper Inc. |
2,910 | | (39 | ) | 79 | $ | (2,950 | ) | 0 | |||||||||||||||
Lehman Brothers Special Financing Inc. |
10,030 | | (12 | ) | 0 | $ | (0 | ) | 10,019 | |||||||||||||||
Debtor-Controlled |
8,556 | (11 | ) | (4 | ) | 8,540 |
(1) | Claim Assignments include the sale of LCPIs and LBSFs claims to LBHI as stated in the individual sale and purchase agreements executed on December 27, 2019, and December 20, 2019, respectively, and effected in January 2020. |
(2) | Includes debt forgiveness of $2.9 billion related to the closing of LCPIs bankruptcy case. |
(3) | Due to Controlled balances from Debtors are included in Liabilities Subject to Compromise herein. |
Page 18
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 4 Due from/to Debtors and Debtor-Controlled Entities (continued)
The following table presents a summary of Due from/to Debtors and Debtor-Controlled Entities balances for Debtors as of April 2, 2020:
LBHI | LBSF | |||||||||||||||
$ in millions |
Due from | Due to | Due from | Due to | ||||||||||||
Lehman Brothers Holdings Inc |
$ | | $ | | $ | | $ | (10,018 | ) | |||||||
LB Special Financing Inc |
10,018 | | | | ||||||||||||
Lehman Commercial Paper Inc |
(0 | ) | 0 | 0 | (0 | ) | ||||||||||
RACERS Claims (1) |
525 | | | | ||||||||||||
Lehman Ali Inc: |
||||||||||||||||
Lehman Ali Inc (PCO) |
1,928 | | | | ||||||||||||
LB I Group Inc: |
||||||||||||||||
LB I Group Inc (PCO) |
1,569 | | | | ||||||||||||
LB Offshore Partners Ltd |
340 | | | | ||||||||||||
314 Commonwealth Ave Inc: |
||||||||||||||||
314 Commonwealth Ave Inc (PCO) |
784 | 0 | | | ||||||||||||
Other: |
||||||||||||||||
Pami Ali LLC |
2,731 | (0 | ) | | | |||||||||||
Real Estate Private Equity Inc |
625 | | | | ||||||||||||
SMF No.1 Limited |
122 | | | | ||||||||||||
Repe LBREP LP, LLC |
180 | | | | ||||||||||||
Other |
261 | 0 | | | ||||||||||||
PCO parent company only |
(1) | Refer to Section IV.I.b of the Disclosure Statement for further information on the RACERS Claims. |
The following table presents a summary of Due from/to Affiliates balances for Debtor-Controlled Entities as of April 2, 2020:
Lehman ALI Inc. | LB I Group Inc. | 314 Commonwealth Ave. Inc. |
Other Debtor-Controlled Entities |
|||||||||||||||||||||||||||||
$ in millions | Due from | Due to | Due from | Due to | Due from | Due to | Due from |
Due to | ||||||||||||||||||||||||
Debtors: |
||||||||||||||||||||||||||||||||
Lehman Brothers Holdings Inc. |
$ | | $ | (1,928 | ) | $ | | $ | (1,909 | ) | $ | | $ | (784 | ) | $ | (0 | ) | $ | (3,894 | ) | |||||||||||
Lehman Commercial Paper Inc. |
| | | | | | | | ||||||||||||||||||||||||
Lehman Brothers Special Financing Inc. |
| | | | | | | | ||||||||||||||||||||||||
Debtor-Controlled: |
||||||||||||||||||||||||||||||||
314 Commonwealth Ave Inc |
$ | 45 | $ | | $ | | $ | | $ | | $ | | $ |
|
$ | | ||||||||||||||||
Lehman Ali Inc (1) |
| | | | | (45 | ) | 174 | | |||||||||||||||||||||||
Real Estate Private Equity Inc (1) |
| | | | | | 217 | (2 | ) | |||||||||||||||||||||||
LB I Group Inc. |
| | | | | | | (319 | ) | |||||||||||||||||||||||
Pami ALI LLC |
| (174 | ) | 291 | | | | | (217 | ) | ||||||||||||||||||||||
Other |
| (0 | ) | 28 | (25 | ) | (0 | ) | 0 | 8 | (1 | ) |
(1) | Due from balances at Other Debtor-Controlled Entities are related to receivables recorded by Pami ALI LLC. |
Page 19
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Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 5 Disputed Claims
The table below presents the remaining Disputed Claims by Debtor, by Class and by Primary Obligor as of April 2, 2020:
$ in millions | ||||||||||||||||||||
Debtor/Class |
Total Number of Filed Claims |
Number of Unliquidated Claims |
Total Filed Amount |
Estimate of Disputed Claims for Reserve Purposes (2) |
Total Cash Reserves for Disputed Claims (3) |
|||||||||||||||
Lehman Brothers Holdings Inc. |
||||||||||||||||||||
2 Secured |
1 | 1 | $ | 6 | $ | $ | | |||||||||||||
5 Senior Third-Party Guarantee (1) |
1 | | 8 | 5 | 0 | |||||||||||||||
LBIE |
1 | | 8 | 5 | 0 | |||||||||||||||
9A Third Party Guarantee other than of the RACERS Trusts (1) |
65 | 1 | 1,075 | 810 | 26 | |||||||||||||||
LBIE |
63 | | 1,013 | 748 | 21 | |||||||||||||||
LBSF |
1 | 1 | | | | |||||||||||||||
LBF |
1 | | 62 | 62 | 5 | |||||||||||||||
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Total - Lehman Brothers Holdings Inc. |
67 | 2 | $ | 1,089 | $ | 815 | $ | 26 | ||||||||||||
Lehman Brothers Special Financing Inc. |
||||||||||||||||||||
4A General Unsecured Claims other than those of Designated Entities |
1 | 1 | $ | | $ | | $ | | ||||||||||||
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|||||||||||
Total - Lehman Brothers Special Financing Inc. |
1 | 1 | $ | | $ | | $ | |
(1) | The Disputed Claims relate to asserted guarantee obligations related to the primary obligor. |
(2) | Certain Claims have been estimated at less than filed amounts, for reserve purposes only, as agreed through stipulation or settlement agreement or pursuant to Court order. Unless otherwise agreed to or ordered by the Court, there is no reserve for unliquidated Claims. |
(3) | In addition to cash, assets are being maintained as reserves for certain claims pursuant to agreements with creditors and/or Bankruptcy Court order. |
Page 20
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||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 6 Legal Proceedings
The Company is involved in or will be impacted by a number of judicial, regulatory and mediation proceedings concerning matters arising in connection with the bankruptcy proceedings and various other matters, including the proceedings listed below. The Company has not included in the April 2, 2020 Cash Flow Estimates any estimate of recoveries for the Excluded Litigations in the table shown below, but has included estimates of recoveries for all other affirmative litigation matters it is pursuing. The Company is not aware of any other litigation matters where the amount at issue exceeds $10 million. As more information becomes available, the Company may record revisions, which may be material, in future Quarterly Financial Reports. (See Note 1Basis of PresentationLitigation for further discussion on the impact of these litigations on the cash flow estimates.)
EXCLUDED LITIGATIONS |
||||||||||
Counterparty |
Debtor(s) |
Commenced |
Court |
Court Reference |
Most Recent | |||||
Mortgage Sellers |
LBHI | Various | Various | Various | (a) | |||||
Bank of America National Association et al. (SPV Avoidance Actions) |
LBSF | September 2010 | Bankruptcy Court | 10-03547 (SCC) | December 31, 2019 Balance Sheets - Docket No. 60486 | |||||
Ballyrock ABS CDO 2007-1 Limited Wells Fargo Bank N.A. (Ballyrock Litigation) |
LBSF | February 2009 | Bankruptcy Court | 09-01032 (SCC) | December 31, 2019 Balance Sheets - Docket No. 60486 |
OTHER LITIGATIONS |
||||||||
Counterparty |
Controlled |
Debtor(s)
Potentially |
Court |
Most Recent | ||||
PLC, LBHI2, LB GP No. 1 Ltd, Deutsche Bank (ECAPs) |
LBHI SLP3 |
LBHI | UK Court | (b) | ||||
Guarantee Claims For Which LBIE Is The Primary Obligor |
LBHI | LBHI | Bankruptcy Court | (c) | ||||
LBIE Other |
None | LBHI | Various | (d) | ||||
LBF Guarantee - Enasarco |
None | LBHI | Swiss Court | April 5, 2018 Balance Sheets - Docket No. 58442 | ||||
Guarantee Clawbacks |
LBHI | LBHI | Bankruptcy Court | (e) | ||||
Trilantic |
LB 1 Group and others | LBHI | NY State Supreme Court | (f) | ||||
LBT Clawbacks |
LBHI | LBHI | Bankruptcy Court | (g) | ||||
Sweetwater |
LBHI | LBHI | Delaware Chancery Court | (h) |
Page 21
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 6 Legal Proceedings (continued)
Page 22
|
||||
Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 6 Legal Proceedings (continued)
Page 23
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Quarterly Financial Report as of April 2, 2020 (Unaudited)
Note 6 Legal Proceedings (continued)
Page 24
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Quarterly Financial Report as of April 2, 2020 (Unaudited)
Page 25
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Quarterly Financial Report as of April 2, 2020 (Unaudited)
Page 26
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||||
LEHMAN BROTHERS HOLDINGS INC. and Other Debtors and Debtor-Controlled Entities
Balance Sheets As of April 2, 2020
(Unaudited)
Lehman Brothers Holdings Inc. |
Lehman Brothers Special Financing Inc. |
Lehman Commercial Paper Inc. |
BNC Mortgage LLC |
Lehman Brothers OTC Derivatives Inc. |
Total Debtor | Total Debtor- Controlled |
Total | |||||||||||||||||||||||||
($ in millions) |
08-13555 | 08-13888 | 08-13900 | 09-10137 | 08-13893 | Entities (1) | Entities (2) | Company | ||||||||||||||||||||||||
Assets |
||||||||||||||||||||||||||||||||
Cash and short-term investments |
$ | 92 | $ | 4 | $ | 0 | $ | 2 | $ | 0 | $ | 97 | $ | 56 | $ | 154 | ||||||||||||||||
Cash and short-term investments pledged or restricted |
150 | 6 | 0 | | | 156 | 19 | 175 | ||||||||||||||||||||||||
Financial instruments and other inventory positions: |
||||||||||||||||||||||||||||||||
Commercial Real Estate |
4 | | | | | 4 | 0 | 4 | ||||||||||||||||||||||||
Residential Real Estate and Other |
4 | | | | | 4 | 0 | 4 | ||||||||||||||||||||||||
Principal investments |
6 | | | | | 6 | 24 | 29 | ||||||||||||||||||||||||
Derivative Receivables and Related Assets |
| 7 | | | | 7 | | 7 | ||||||||||||||||||||||||
|
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|
|||||||||||||||||
Total Financial instruments and other inventory positions |
14 | 7 | | | | 21 | 24 | 45 | ||||||||||||||||||||||||
Receivables from Debtors and Debtor-Controlled Entities and other assets |
76 | 1 | 0 | 0 | | 77 | 74 | 151 | ||||||||||||||||||||||||
Investments in Affiliates |
(30,264 | ) | | | | | (30,264 | ) | (22,660 | ) | (52,924 | ) | ||||||||||||||||||||
Due from Affiliates: |
||||||||||||||||||||||||||||||||
Debtors and Debtor- Controlled Entities |
19,083 | | | | | 19,083 | 1 | 19,084 | ||||||||||||||||||||||||
Non-Controlled Affiliates |
9,943 | (0 | ) | | | | 9,943 | 804 | 10,747 | |||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total Due from Affiliates |
29,027 | (0 | ) | | | | 29,027 | 804 | 29,831 | |||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total Assets |
$ | (905 | ) | $ | 17 | $ | 0 | $ | 2 | $ | 0 | $ | (886 | ) | $ | (21,683 | ) | $ | (22,568 | ) | ||||||||||||
|
|
|
|
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|
|
|
|
|
|
|
|||||||||||||||||
Liabilities and Stockholders Equity |
||||||||||||||||||||||||||||||||
Liabilities |
||||||||||||||||||||||||||||||||
Payables to Debtors and Debtor-Controlled Entities and other liabilities |
$ | 89 | $ | 3 | $ | 0 | $ | 0 | $ | | $ | 92 | $ | 5 | $ | 98 | ||||||||||||||||
Due to Affiliates: |
||||||||||||||||||||||||||||||||
Debtor-Controlled Entities |
$ | | | | | | | 8,540 | 8,540 | |||||||||||||||||||||||
Non-Controlled Affiliates |
| | | | | | 30 | 30 | ||||||||||||||||||||||||
Total Due to Affiliates |
| | | | | | 8,570 | 8,570 | ||||||||||||||||||||||||
|
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|
|
|||||||||||||||||
Taxes Payable |
29 | | | | | 29 | 8 | 37 | ||||||||||||||||||||||||
Liabilities Subject to Compromise |
131,421 | 22,677 | (0 | ) | (0 | ) | (0 | ) | 154,098 | 0 | 154,098 | |||||||||||||||||||||
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|
|||||||||||||||||
Total Liabilities |
131,539 | 22,680 | 0 | | (0 | ) | 154,219 | 8,583 | 162,802 | |||||||||||||||||||||||
Stockholders Equity |
(132,445 | ) | (22,662 | ) | 0 | 2 | 0 | (155,105 | ) | (30,266 | ) | (185,370 | ) | |||||||||||||||||||
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|
|||||||||||||||||
Total Liabilities and Stockholders Equity |
$ (905) | $ 17 | $ 0 | $ 2 | $ 0 | $ (886) | $ (21,683) | $ (22,568) | ||||||||||||||||||||||||
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See accompanying Notes to Balance Sheets
Note: All values that are exactly zero are shown as . Values between zero and $500,000 appear as 0.
(1) | Balances for Debtors do not reflect the impact of eliminations of intercompany balances and investments in subsidiaries. |
(2) | Certain Debtor-Controlled Entities Balance Sheets are presented on page 28. |
(3) | On December 27, 2019, LBHI and LCPI executed a sale and purchase agreement pursuant to which LBHI agreed to purchase LCPIs remaining assets and certain obligations for total consideration of $63.2 million. On December 20, 2019, LBHI and LBSF executed a sale and purchase agreement pursuant to which LBHI agreed to purchase LBSFs Allowed Claims into LBHI for total consideration of $17.7 million. These transactions were effective in January 2020. |
Page 27
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LEHMAN BROTHERS HOLDINGS INC. and Other Debtors and Debtor-Controlled Entities
Balance Sheets As of April 2, 2020 (Debtor-Controlled Entities)
(Unaudited)
($ in millions) |
Lehman ALI Inc. (2) |
Property Asset Management Inc. (3) |
LB I Group Inc. (3) |
Lehman Brothers Bancorp Inc. (3) |
PAMI Holdings LLC |
314 Common- wealth Ave Inc. (3) |
PAMI ALI LLC |
Other Debtor- Controlled Entities |
Debtor - Controlled Group Elims (1) |
Total Debtor- Controlled Entities |
||||||||||||||||||||||||||||||
Assets |
||||||||||||||||||||||||||||||||||||||||
Cash and short-term investments |
$ | 0 | $ | 0 | $ | 1 | $ | 3 | $ | 10 | $ | 0 | $ | 0 | $ | 42 | $ | | $ | 56 | ||||||||||||||||||||
Cash and short-term investments pledged or restricted |
(0 | ) | 0 | 7 | | | | | 11 | | 19 | |||||||||||||||||||||||||||||
Financial instruments and other inventory positions: |
||||||||||||||||||||||||||||||||||||||||
Commercial Real Estate |
| 0 | | | | | (0 | ) | | | 0 | |||||||||||||||||||||||||||||
Residential Real Estate and Other |
| 0 | 0 | | | | | | | 0 | ||||||||||||||||||||||||||||||
Principal investments |
0 | | 7 | | | | 0 | 16 | | 24 | ||||||||||||||||||||||||||||||
Derivative Receivables and Related Assets |
| | | | | | | | | | ||||||||||||||||||||||||||||||
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Total Financial instruments and other inventory positions |
0 | 0 | 7 | | | | 0 | 16 | | 24 | ||||||||||||||||||||||||||||||
Receivables from Debtors and Debtor-Controlled Entities and other assets |
0 | 0 | 1 | 69 | 0 | 0 | 0 | 16 | (13 | ) | 74 | |||||||||||||||||||||||||||||
Investments in Affiliates |
(27,725 | ) | | | 2 | | | | 0 | 5,063 | (22,660 | ) | ||||||||||||||||||||||||||||
Due from Affiliates: |
||||||||||||||||||||||||||||||||||||||||
Debtors and Debtor- Controlled Entities |
45 | | 319 | | 0 | (0 | ) | 390 | 8 | (762 | ) | 1 | ||||||||||||||||||||||||||||
Non-Controlled Affiliates |
(0 | ) | | 0 | | 1 | | (0 | ) | 803 | | 804 | ||||||||||||||||||||||||||||
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Total Due from Affiliates |
45 | | 319 | | 2 | (0 | ) | 390 | 811 | (762 | ) | 804 | ||||||||||||||||||||||||||||
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|
|||||||||||||||||||||
Total Assets |
$ | (27,680 | ) | $ | 0 | $ | 336 | $ | 74 | $ | 12 | $ | 0 | $ | 391 | $ | 896 | $ | 4,288 | $ | (21,683 | ) | ||||||||||||||||||
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Liabilities and Stockholders Equity |
||||||||||||||||||||||||||||||||||||||||
Liabilities |
||||||||||||||||||||||||||||||||||||||||
Payables to Debtors and Debtor-Controlled Entities and other liabilities |
$ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 3 | $ | 0 | $ | 0 | $ | 15 | $ | (13 | ) | $ | 5 | |||||||||||||||||||
Due to Affiliates: |
||||||||||||||||||||||||||||||||||||||||
Debtor-Controlled Entities |
2,101 | | 1,934 | | 6 | 829 | 3,023 | 1,409 | (762 | ) | 8,540 | |||||||||||||||||||||||||||||
Non-Controlled Affiliates |
| | 1 | | 1 | | | 27 | | 30 | ||||||||||||||||||||||||||||||
|
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|
|||||||||||||||||||||
Total Due to Affiliates |
2,101 | | 1,936 | | 7 | 829 | 3,023 | 1,436 | (762 | ) | 8,570 | |||||||||||||||||||||||||||||
Taxes Payable |
| | 2 | | | | | 6 | | 8 | ||||||||||||||||||||||||||||||
Liabilities Subject to Compromise |
| | | | | | | 0 | | 0 | ||||||||||||||||||||||||||||||
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|||||||||||||||||||||
Total Liabilities |
2,101 | 0 | 1,938 | 0 | 9 | 829 | 3,024 | 1,457 | (775 | ) | 8,583 | |||||||||||||||||||||||||||||
Stockholders Equity |
(29,782 | ) | 0 | (1,602 | ) | 74 | 3 | (829 | ) | (2,632 | ) | (561 | ) | 5,063 | (30,266 | ) | ||||||||||||||||||||||||
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|
|||||||||||||||||||||
Total Liabilities and Stockholders Equity |
$ | (27,680 | ) | $ | 0 | $ | 336 | $ | 74 | $ | 12 | $ | 0 | $ | 391 | $ | 896 | $ | 4,288 | $ | (21,683 | ) | ||||||||||||||||||
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|
|
See accompanying Notes to Balance Sheets
Note: All values that are exactly zero are shown as . Values between zero and $500,000 appear as 0.
(1) | Balances reflect the impact of eliminations of (i) intercompany balances only between Debtor-Controlled Entities and (ii) investments in subsidiaries only between Debtor-Controlled Entities. |
(2) | Lehman Ali Inc is reflected on a consolidated basis, excluding (i) separately reported wholly-owned subsidiaries that are Debtor entities (e.g. LCPI and LBSF) and (ii) separately reported Debtor-Controlled Entities and their direct subsidiaries (e.g. 314 Commonwealth Ave Inc., Property Asset Management Inc. and Pami ALI LLC). |
(3) | Entities are reflected on a consolidated basis. |
Page 28
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