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8-K - 8-K - LEHMAN BROTHERS HOLDINGS INC. PLAN TRUST | d130562d8k.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 1, 2021
DEBTORS ADDRESS: | LEHMAN BROTHERS HOLDINGS INC. | |
c/o KRISTINE DICKSON CHIEF FINANCIAL OFFICER | ||
110 EAST 42ND STREET | ||
SUITE 820 | ||
NEW YORK, NY 10017 | ||
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: May 28, 2021
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Table of Contents
I. | Schedule of Debtors | 3 | ||||
II. | Cash Flow Estimates | 4 | ||||
III. | Notes to the Cash Flow Estimates | 7 | ||||
Note 1Basis of Presentation | 7 | |||||
Note 2Other Receipts | 10 | |||||
Note 3Due from/to Non-Controlled Affiliates | 11 | |||||
Note 4Due from/to Debtors and LBHI-Controlled Entities | 14 | |||||
Note 5 Disputed Claims | 15 | |||||
Note 6 Legal Proceedings | 16 | |||||
Note 7 Taxes Payable | 20 | |||||
Note 8 Subsequent Events | 21 | |||||
IV. | Balance Sheets | 22 |
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
Quarterly Financial Report as of April 1, 2021 (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) |
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Lehman Brothers Holdings Inc. (LBHI) |
08-13555 | 09/15/2008 | ||||||
Lehman Brothers Special Financing Inc. (LBSF) |
08-13888 | 10/03/2008 |
The following Debtors chapter 11 cases were closed 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
Quarterly Financial Report as of April 1, 2021 (Unaudited)
II. Cash Flow Estimates
Lehman Brothers Holdings Inc. & LBHI-Controlled Entities
($ in millions) | As of 12/31/20 |
Cash Activity 1/1/21 - 4/1/21 |
Estimate Changes |
Transfers, Reclassifications, Adjustments (a) |
As of 4/1/21 |
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CASH AND INVESTMENTS |
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Reserves for Claims |
$ | 47 | $ | | $ | (7 | ) | $ | | 41 | ||||||||||||||
Reserves for Operating Expenses, Incentive Fees, and Other (b) |
145 | (56 | ) | (6 | ) | | 83 | |||||||||||||||||
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Total Cash & InvestmentsRestricted |
192 | (56 | ) | (13 | ) | | 124 | |||||||||||||||||
Total Cash & InvestmentsUnrestricted |
146 | (52 | ) | 13 | (6 | ) | 100 | |||||||||||||||||
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TOTAL CASH AND INVESTMENTS [A] |
$ | 338 | $ | (108 | ) | $ | | $ | (6 | ) | 224 | |||||||||||||
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CASH FLOW ESTIMATES |
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Net Receipts |
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Financial Instruments |
$ | 37 | $ | (28 | ) | $ | 34 | $ | 6 | 49 | ||||||||||||||
Other |
Note 2 | 77 | (31 | ) | 1 | 0 | 47 | |||||||||||||||||
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Sub-TotalNet Receipts |
114 | (59 | ) | 35 | 6 | 96 | ||||||||||||||||||
Recoveries From Non-Controlled Affiliates |
Note 3 | |||||||||||||||||||||||
Europe |
1,207 | (323 | ) | 5 | | 890 | ||||||||||||||||||
Asia |
56 | (10 | ) | (7 | ) | | 39 | |||||||||||||||||
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Sub-TotalRecoveries From Non-Controlled Affiliates |
1,264 | (333 | ) | (2 | ) | | 929 | |||||||||||||||||
Recoveries From Controlled Affiliates |
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Pre-Petition Intercompany Receipts |
Note 4 | 7 | (7 | ) | (0 | ) | | | ||||||||||||||||
Net Post-Petition Intercompany Receipts from / (Payables to) |
2 | (2 | ) | 0 | | | ||||||||||||||||||
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Sub-TotalRecoveries From Controlled Affiliates |
9 | (8 | ) | (0 | ) | | | |||||||||||||||||
Operating Expenses and Incentive Fees |
(112 | ) | 21 | (7 | ) | | (98 | ) | ||||||||||||||||
Estimated Taxes Payable |
Note 7 | (22 | ) | | (1 | ) | | (23 | ) | |||||||||||||||
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TOTAL CASH FLOW FROM OPERATIONS + OTHER RECEIPTS [B] |
$ | 1,253 | $ | (380 | ) | $ | 25 | $ | 6 | 904 | ||||||||||||||
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OTHER ADJUSTMENTS |
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(Less): Cash held for the benefit of third parties (b) |
$ | (61 | ) | $ | 34 | $ | 19 | $ | | (8 | ) | |||||||||||||
Plus: Plan Adjustments from Participatory Debtor |
1 | (1 | ) | 0 | | | ||||||||||||||||||
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TOTAL OTHER ADJUSTMENTS [C] |
$ | (60 | ) | $ | 33 | $ | 19 | $ | | (8 | ) | |||||||||||||
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ESTIMATED CASH AVAILABLE FOR DISTRIBUTIONS [A+B+C] |
$ | 1,530 | $ | (454 | ) | $ | 44 | $ | | 1,120 | ||||||||||||||
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(a) | In March 2021, LBHI and LBSF executed a sale and purchase agreement pursuant to which LBHI purchased LBSFs remaining assets and certain obligations for total consideration of $5.7 million. |
(b) | Cash held for the benefit of third parties includes Distributions on Allowed Claims (not remitted) and other items. In December 2020, LBHI received $34 million on behalf of a third party; these funds were subsequently remitted in January 2021. |
Page 4
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Lehman Brothers Special Financing Inc.
($ in millions) | As of 12/31/20 |
Cash Activity 1/1/21 - 4/1/21 |
Estimate Changes |
Transfers, Reclassifications, Adjustments (a) |
As of 4/1/21 |
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CASH AND INVESTMENTS |
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Reserves for Claims |
$ | 0 | $ | | $ | (0 | ) | | ||||||||||||||||
Reserves for Operating Expenses, Incentive Fees, and Other |
2 | (2 | ) | (0 | ) | | | |||||||||||||||||
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Total Cash & InvestmentsRestricted |
2 | (2 | ) | (0 | ) | | | |||||||||||||||||
Total Cash & InvestmentsUnrestricted |
9 | (15 | ) | 0 | 6 | | ||||||||||||||||||
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TOTAL CASH AND INVESTMENTS [A] |
$ | 11 | $ | (17 | ) | $ |
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$ | 6 | | ||||||||||||||
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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 | ) | (0 | ) | | ||||||||||||||||
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Sub-TotalNet Receipts |
7 | (0 | ) | (0 | ) | (6 | ) | | ||||||||||||||||
Recoveries From Non-Controlled Affiliates |
Note 3 | |||||||||||||||||||||||
Europe |
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Asia |
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Sub-TotalRecoveries From Non-Controlled Affiliates |
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Recoveries From Controlled Affiliates |
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Pre-Petition Intercompany Receipts |
Note 4 | | | | | | ||||||||||||||||||
Net Post-Petition Intercompany Receipts from / (Payables to) |
(2 | ) | 2 | (0 | ) | | | |||||||||||||||||
Investments in Affiliates |
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Sub-TotalRecoveries From Controlled Affiliates |
(2 | ) | 2 | (0 | ) | | | |||||||||||||||||
Operating Expenses and Incentive Fees |
(0 | ) | | 0 | | | ||||||||||||||||||
Estimated Taxes Payable |
Note 7 | | | | | | ||||||||||||||||||
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TOTAL CASH FLOW FROM OPERATIONS + OTHER RECEIPTS [B] |
$ | 5 | $ | 1 | $ | 0 | $ | (6 | ) | | ||||||||||||||
OTHER ADJUSTMENTS |
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(Less): Cash held for the benefit of third parties |
$ | (0 | ) | $ | | $ | 0 | $ | | | ||||||||||||||
(Less): Plan Adjustments to Participatory Debtor |
(1 | ) | 1 | (0 | ) | | | |||||||||||||||||
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TOTAL OTHER ADJUSTMENTS [C] |
$ | (1 | ) | $ | 1 | $ | 0 | $ | | | ||||||||||||||
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ESTIMATED CASH AVAILABLE FOR DISTRIBUTIONS [A+B+C] |
$ | 15 | $ | (15 | ) | $ | 0 | $ | | | ||||||||||||||
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Note: totals may not foot due to rounding.
(a) | In March 2021, LBHI and LBSF executed a sale and purchase agreement pursuant to which LBHI purchased LBSFs remaining assets and certain obligations for total consideration of $5.7 million. |
(b) | On May 27, 2021, LBHI, as Plan Administrator, filed a motion with the Bankruptcy Court for a final decree to close the LBSF Chapter 11 case (see Docket No. 61141). |
Page 5
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Estimated Remaining Creditor Recoveries
The following schedules show the estimated remaining recoveries for LBHI by claim class, based on the Estimated Cash Available for Distributions in the preceding table on page 4. The estimated remaining recoveries on page 4and the schedule below do not include (a) potential recoveries from the Excluded Litigations, and (b) estimates for potential catch-up distributions on potential full or partial allowance of any disputed claims.
($ in millions)
Lehman Brothers Holdings Inc.
Allowed Claims Eligible for Distributions (1) |
Estimated Remaining Recovery |
Estimated Remaining Recovery % as of April 1, 2021 (3) |
Actual Recovery % Thru D22 (2) |
Estimated End of Case Recovery % |
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Class |
Designation |
$ | $ | A | B | = A + B | ||||||||||||||||
3 | Senior Unsecured |
$ | 82,542 | $ | 577 | 0.699 | % | 46.409 | % | 47.108 | % | |||||||||||
4A | Senior Affiliate Claims |
33,571 | 209 | 0.624 | % | 37.372 | % | 37.996 | % | |||||||||||||
4B | Senior Affiliate Guarantee |
9,726 | 59 | 0.610 | % | 36.467 | % | 37.077 | % | |||||||||||||
5 | Senior Third-Party Guarantee |
31,704 | 155 | 0.488 | % | 29.178 | % | 29.666 | % | |||||||||||||
7 | General Unsecured |
5,242 | 34 | 0.648 | % | 43.446 | % | 44.095 | % | |||||||||||||
8 | Derivative Affiliate / Affiliate Guarantee Claims |
451 | 3 | 0.573 | % | 34.335 | % | 34.909 | % | |||||||||||||
9A | Third Party Guarantee Derivatives |
18,255 | 84 | 0.459 | % | 27.465 | % | 27.924 | % | |||||||||||||
9B | Third Party Guarantee Derivatives RACERs |
| | 0.279 | % | 16.698 | % | 16.977 | % | |||||||||||||
10A | Subordinated Class 10A Claims |
3,399 | | | | | ||||||||||||||||
10B | Subordinated Class 10B Claims |
10,330 | | | | | ||||||||||||||||
10C | Subordinated Class 10C Claims |
1,493 | | | | | ||||||||||||||||
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Total | $ | 196,714 | $ | 1,120 | ||||||||||||||||||
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(1) | Estimated Recovery percentages are calculated based on recoveries of Allowed Claims Eligible for Distributions as reported on Exhibit D of the 22nd Distribution Notice filed on March 25, 2021. For purposes of this calculation: |
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 LBHI owns against itself. |
(2) | Through the 22nd Plan Distribution on April 1, 2021 (D22), the Debtors have made distributions to creditors totaling $128.8 billion, of which $95.8 billion were payments on account of claims owned or formerly owned by third party creditors. |
(3) | Pursuant to the Motion of the Plan Administrator for an Order Authorizing a Voluntary Final Distribution for Certain Creditors of Lehman Brothers Holdings Inc. and Granting Related Relief (the Final Distribution Motion) filed contemporaneously with this report, the Plan Administrator proposes to use these Estimated Remaining Recovery % as of Apr 1, 2021 as the percentages for the Final Distribution (as defined in the Final Distribution Motion). Please see the Final Distribution Motion for further information. |
Page 6
Quarterly Financial Report as of April 1, 2021 (Unaudited)
III. Notes to the Cash Flow Estimates
Page 7
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Page 8
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Page 9
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Note 2 Other Receipts
The following table summarizes the main components of Other Receipts as of April 1, 2021:
Debtors | LBHI- Controlled Entities |
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$ in millions |
LBHI | LBSF | ||||||||||
Affiliate Claims (1) |
44 | | | |||||||||
Other |
1 | (0 | ) | 3 |
(1) | Includes $44 million of recoveries from claims against Non-Controlled Affiliates acquired through settlements with third parties valued at estimated remaining recoveries. The largest component of Affiliate Claims is an admitted claim, prior to distributions, against Lehman Brothers Limited for £66 million. |
Page 10
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Note 3 Due from/to Non-Controlled Affiliates
The following table presents, on an aggregate basis for LBHI and LBHI-Controlled Entities, admitted and unsettled filed claims (including statutory interest to date), collections to date from Non-Controlled Affiliates, and aggregate estimated remaining recoveries (including statutory interest):
Estimated Recoveries (4) |
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$ 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 & LBHI- Controlled Entities |
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Europe |
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Lehman Brothers Finance S.A. |
CHF | 10,153 | (2,100 | ) | 10,781 | (2,230 | ) | 8,552 | ||||||||||||||||||||
Lehman Brothers Holdings Intermediate 2 LtdSubordinated |
USD | 6,139 | | 6,139 | ||||||||||||||||||||||||
Lehman Brothers Holdings PLCSubordinated |
USD | 1,900 | | 1,900 | ||||||||||||||||||||||||
Lehman Brothers Holdings PLCSenior |
GBP | 295 | (282 | ) | 408 | (390 | ) | 17 | ||||||||||||||||||||
Thayer Properties Limited |
GBP | 172 | (93 | ) | 238 | (128 | ) | 109 | ||||||||||||||||||||
LB (PTG) Ltd |
GBP | 170 | (92 | ) | 235 | (128 | ) | 107 | ||||||||||||||||||||
LB ODC 3 |
GBP | 101 | (62 | ) | 140 | (86 | ) | 54 | ||||||||||||||||||||
Other |
2,002 | (1,978 | ) | 24 | ||||||||||||||||||||||||
Recoveries of Prior Guarantee Distributions (1) |
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Total Europe |
21,842 | (4,939 | ) | 16,903 | 890 | |||||||||||||||||||||||
Asia |
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LB Commercial Corp. Asia Limited |
HKD | 14,769 | (9,134 | ) | 1,899 | (1,175 | ) | 725 | ||||||||||||||||||||
LB Asia Pacific (Singapore) PTE |
USD | 621 | (365 | ) | 621 | (365 | ) | 256 | ||||||||||||||||||||
LB Investments PTE Ltd |
USD | 536 | (347 | ) | 536 | (347 | ) | 190 | ||||||||||||||||||||
LB RE Australia Commerical PTY LTD |
AUD | 218 | (66 | ) | 166 | (50 | ) | 116 | ||||||||||||||||||||
LB Australia Holdings PTY LTD |
AUD | 145 | (63 | ) | 111 | (48 | ) | 63 | ||||||||||||||||||||
Lehman Brothers Australia Ltd |
AUD | 111 | (66 | ) | 85 | (51 | ) | 34 | ||||||||||||||||||||
Other |
11,067 | (11,023 | ) | 45 | ||||||||||||||||||||||||
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Total Asia |
14,486 | (13,058 | ) | 1,428 | 39 | |||||||||||||||||||||||
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Total |
$ | 36,328 | $ | (17,997 | ) | $ | 18,331 | $ | 929 | |||||||||||||||||||
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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 LBHI-Controlled Entities. |
(3) | Admitted and Unsettled Filed Claims in USD includes notional amounts 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. and LBIE acquired through settlements with third parties are included in Other Assets (refer to Note 2 Other Receipts for additional information). |
Page 11
Quarterly Financial Report as of April 1, 2021 (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 1, 2021, and the related activity since the previously filed Quarterly Financial Report as of December 31, 2020:
Activity 01/01/21 - 04/01/21 | ||||||||||||||||||||||||
$ in millions | As of December 31, 2020 |
Cash Receipts | Cash Distributions |
Claim Assignments |
Other (1) | As of April 1, 2021 |
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Due From Non-Controlled |
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Lehman Brothers Finance S.A. |
$ | 8,978 | $ | (15 | ) | $ | (412 | ) | $ | 8,552 | ||||||||||||||
LB Holdings Intermediate 2 Ltd Subordinated (2) |
6,139 | | 6,139 | |||||||||||||||||||||
Lehman Brothers Holdings PLC Subordinated (2) |
1,900 | | 1,900 | |||||||||||||||||||||
Thayer Properties Limited |
108 | (0 | ) | 1 | 109 | |||||||||||||||||||
LB (PTG) Ltd |
108 | (2 | ) | 1 | 107 | |||||||||||||||||||
LB Commercial Corp. Asia Limited |
727 | (2 | ) | 725 | ||||||||||||||||||||
LB Asia Pacific (Singapore) PTE |
258 | (2 | ) | (0 | ) | 256 | ||||||||||||||||||
LB Investments PTE Ltd |
194 | (5 | ) | | 190 | |||||||||||||||||||
Other |
340 | (76 | ) | | 90 | 354 | ||||||||||||||||||
Due To Non-Controlled (3) |
$ | 29,630 | $ | | $ | (110.45 | ) | $ | | $ | (1,275 | ) | $ | 28,245 |
(1) | Other Due From Non-Controlled Affiliates primarily includes ($414) million resulting from the negative impact of movements in foreign exchange rates for the period calculated on the historical net receivable balances. |
Other Due To Non-Controlled Affiliates primarily includes: (i) the recoupment of $223 million and the write off of $700 million, both resulting from the settlement of a multi-party litigation wherein LBHI sought to recapture previous distributions it made on certain Guarantee Claims owned by Non-Controlled Affiliates, because the corresponding primary claims were subsequently satisfied in full by distributions from the primary obilgors; and (ii) the write-off of $770 million related to the closing of LBSFs bankruptcy case.
(2) | Balances represent the notional subordinated receivables. |
(3) | Due to Non-Controlled balances from LBHI are included in Liabilities Subject to Compromise herein, and primarily include (i) claims against LBHI, net of distributions, originally held by Non-Controlled Affiliates that are currently held by third parties, and (ii) a claim held by Lehman Brothers Treasury Co B.V., in which LBHI has no direct or indirect equity interest. |
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Quarterly Financial Report as of April 1, 2021 (Unaudited)
Note 3 Due from/to Non-Controlled Affiliates (continued)
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Quarterly Financial Report as of April 1, 2021 (Unaudited)
Note 4 Due from/to Debtors and LBHI-Controlled Entities
The table below presents the Due from/to Debtors and LBHI-Controlled Entities balances as of April 1, 2021, and the related activity since the previously filed Quarterly Financial Report as of December 31, 2020:
Activity 01/01/21 - 04/01/21 | ||||||||||||||||||||||||
$ in millions | As of December 31, 2020 |
Cash Receipts | Cash Distributions |
Claim Assignments |
Other (1) | As of April 1, 2021 |
||||||||||||||||||
Due From Controlled |
||||||||||||||||||||||||
Debtors: |
||||||||||||||||||||||||
Lehman Brothers Holdings Inc. |
||||||||||||||||||||||||
LB Special Financing Inc |
$ | 10,018 | $ | (7 | ) | $ | (10,012 | ) | $ | (0) | ||||||||||||||
RACERS Claims (2) |
525 | (3 | ) | (224 | ) | 298 | ||||||||||||||||||
Pami Ali LLC |
2,731 | | 2,731 | |||||||||||||||||||||
Lehman Ali Inc (PCO) |
1,928 | | 1,928 | |||||||||||||||||||||
LB I Group Inc (PCO) |
1,565 | (11 | ) | | 1,554 | |||||||||||||||||||
314 Commonwealth Ave Inc (PCO) |
784 | | 784 | |||||||||||||||||||||
Real Estate Private Equity Inc |
625 | | 625 | |||||||||||||||||||||
LB Offshore Partners Ltd |
340 | (0 | ) | | 340 | |||||||||||||||||||
Repe LBREP LP, LLC |
179 | | 179 | |||||||||||||||||||||
Other |
254 | (1 | ) | (6 | ) | $ | 247 | |||||||||||||||||
Due To Controlled (3) |
||||||||||||||||||||||||
Debtors: |
||||||||||||||||||||||||
Lehman Brothers Special Financing Inc. |
||||||||||||||||||||||||
Lehman Brothers Holdings Inc. |
$ | 10,019 | $ | (7 | ) | $ | (10,012 | ) | $ | 0 | ||||||||||||||
LBHI-Controlled |
||||||||||||||||||||||||
Lehman Brothers Holdings Inc. |
8,405 | (12 | ) | $ | (6) | 8,387 |
(1) | Other includes the write-off of $10.2 billion of LBHIs net receivable balance from LBSF, and the corresponding net payable balance at LBSF, related to the closing of LBSFs bankruptcy case. |
(2) | Refer to Section IV.I.b of the Disclosure Statement for further information on the RACERS Claims. |
(3) | Due to Controlled balances from Debtors are included in Liabilities Subject to Compromise herein. |
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Quarterly Financial Report as of April 1, 2021 (Unaudited)
Note 5 Disputed Claims
The table below presents the remaining Disputed Claims by Class and by Primary Obligor as of April 1, 2021:
$ 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. |
||||||||||||||||||||
9A Third Party Guarantee other than of the RACERS Trusts (1) |
7 | | 249 | 249 | 31 | |||||||||||||||
LBIE |
6 | | 188 | 188 | 16 | |||||||||||||||
LBF |
1 | | 62 | 62 | 15 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
TotalLehman Brothers Holdings Inc. |
7 | | $ | 249 | $ | 249 | $ | 31 |
(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 a Bankruptcy Court order. The Company has separately entered into a stipulation with a holder of a disputed claim to reserve the potential obligation entirely in cash. |
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Quarterly Financial Report as of April 1, 2021 (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 1, 2021 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 $10 million. As more information becomes available, the Company may record revisions, which may be material, in future Quarterly Financial Reports. (See Note 1Basis of PresentationLitigation for further discussion on the impact of these litigations on the cash flow estimates.)
EXCLUDED LITIGATIONS
Counterparty | Debtor(s) | Commenced | Court | Court Reference |
Most Recent Disclosure | |||||
| ||||||||||
Mortgage Sellers | LBHI | Various | Various | Various | (a) |
OTHER LITIGATIONS
Counterparty |
Controlled |
Debtor(s) |
Court |
Most Recent | ||||
PLC, LBHI2, LB GP No. 1 Ltd, Deutsche Bank (ECAPs) |
LBHI SLP3 |
LBHI | UK Court | (b) | ||||
Guarantee Claims For Which LBIE Is The Primary Obligor | LBHI | LBHI | Bankruptcy Court | (c) | ||||
LBIE Other | None | LBHI | Various | (d) | ||||
LBF GuaranteeEnasarco | None | LBHI | Swiss Court | April 5, 2018 Balance Sheets Docket No. 58442 | ||||
LBT Clawbacks | LBHI | LBHI | Bankruptcy Court | October 1, 2020 Balance SheetsDocket No. 60960 | ||||
Sweetwater | LBHI | LBHI | Delaware Chancery Court | June 30, 2020 Balance SheetsDocket No. 60877 |
Page 16
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Note 6 Legal Proceedings (continued)
Page 17
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Note 6 Legal Proceedings (continued)
Page 18
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Page 19
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Note 7 Taxes Payable
Page 20
Quarterly Financial Report as of April 1, 2021 (Unaudited)
Note 8 Subsequent Events
LBSF Wind Down
Page 21
IV. Balance Sheets
LEHMAN BROTHERS HOLDINGS INC. and Other Debtors and LBHI-Controlled Entities
Balance Sheets As of April 1, 2021
(Unaudited)
($ in millions) |
Lehman Brothers Holdings Inc. 08-13555 |
Lehman Brothers Special Financing Inc. 08-13888 |
Total Debtor Entities (1) |
Total LBHI- Controlled Entities (2) |
||||||||||||
Assets |
||||||||||||||||
Cash and short-term investments |
$ | 49 | $ | 0 | $ | 49 | $ | 51 | ||||||||
Cash and short-term investments pledged or restricted |
122 | | 122 | 2 | ||||||||||||
Financial instruments and other inventory positions: |
||||||||||||||||
Commercial Real Estate |
3 | 0 | 3 | | ||||||||||||
Residential Real Estate and Other |
1 | (0 | ) | 1 | 0 | |||||||||||
Principal investments |
6 | (0 | ) | 6 | 37 | |||||||||||
Derivative Receivables and Related Assets |
3 | 0 | 3 | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Financial instruments and other inventory positions |
12 | 0 | 12 | 37 | ||||||||||||
Receivables from Debtors and LBHI-Controlled Entities and other assets |
47 | (0 | ) | 47 | 5 | |||||||||||
Investments in Affiliates |
(2,137 | ) | (0 | ) | (2,137 | ) | (0 | ) | ||||||||
Due from Affiliates: |
||||||||||||||||
Debtors and LBHI-Controlled Entities |
8,684 | 0 | 8,684 | (0 | ) | |||||||||||
Non-Controlled Affiliates |
12,167 | (0 | ) | 12,167 | 6,164 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Due from Affiliates |
20,851 | (0 | ) | 20,851 | 6,164 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Assets |
$ | 18,945 | $ | 0 | $ | 18,945 | $ | 6,258 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Liabilities and Stockholders Equity |
||||||||||||||||
Liabilities |
||||||||||||||||
Payables to Debtors and LBHI-Controlled Entities and other liabilities |
$ | 12 | $ | | $ | 12 | $ | 5 | ||||||||
Due to Affiliates: |
||||||||||||||||
LBHI-Controlled Entities |
$ | | | | 8,387 | |||||||||||
Non-Controlled Affiliates |
0 | | 0 | 2 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Due to Affiliates |
0 | | 0 | 8,389 | ||||||||||||
Taxes Payable |
18 | (0 | ) | 18 | 5 | |||||||||||
Liabilities Subject to Compromise |
130,371 | 0 | 130,371 | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Liabilities |
130,401 | 0 | 130,401 | 8,399 | ||||||||||||
Stockholders Equity |
(111,456 | ) | (0 | ) | (111,456 | ) | (2,140 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Liabilities and Stockholders Equity |
$ | 18,945 | $ | 0 | $ | 18,945 | $ | 6,258 | ||||||||
|
|
|
|
|
|
|
|
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) | Balances for LBHI-Controlled Entities reflect the impact of eliminations of (i) intercompany balances only between LBHI-Controlled Entities and (ii) investments in subsidiaries only between LBHI-Controlled Entities. |
Page 22