EX-99.1 2 a09-31524_1ex99d1.htm EX-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

 

 

 

Debtors.

 

 

 

 

MONTHLY OPERATING REPORT

 

SEPTEMBER 2009

 

SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS

SCHEDULE OF PROFESSIONAL FEE AND EXPENSE DISBURSEMENTS

 

DEBTORS’ ADDRESS:

 

LEHMAN BROTHERS HOLDINGS INC.

 

 

c/o WILLIAM J. FOX

 

 

1271 AVENUE OF THE AMERICAS

 

 

35th FLOOR

 

 

NEW YORK, NY 10020

 

 

 

DEBTORS’ ATTORNEYS:

 

WEIL, GOTSHAL & MANGES LLP

 

 

c/o SHAI WAISMAN

 

 

767 FIFTH AVENUE

 

 

NEW YORK, NY 10153

 

 

 

REPORT PREPARER:

 

LEHMAN BROTHERS HOLDINGS INC., A DEBTOR IN POSSESSION (IN THE SOUTHERN DISTRICT OF NEW YORK)

 

 

THIS OPERATING STATEMENT MUST BE SIGNED BY A REPRESENTATIVE OF THE DEBTOR

 

 

The undersigned, having reviewed the attached report and being familiar with the Debtors’ financial affairs, verifies under penalty of perjury, that the information contained therein is complete, accurate and truthful to the best of my knowledge.

 

 

 

 

 

Lehman Brothers Holdings Inc.

 

Date:   October 14, 2009

 

 

By: /s/ William J. Fox

 

 

 

 

William J. Fox

 

 

 

 

Executive Vice President

 

 

 

Indicate if this is an amended statement by checking here:          AMENDED STATEMENT o

 


 

TABLE OF CONTENTS

 

Schedule of Debtors

 

3

 

 

 

Lehman Brothers Holdings Inc. (“LBHI”) and Other Debtors and Other Controlled Entities

 

 

Basis of Presentation — Schedule of Cash Receipts and Disbursements

 

4

 

 

 

Schedule of Cash Receipts and Disbursements

 

5

 

 

 

LBHI

 

 

Basis of Presentation — Schedule of Professional Fee and Expense Disbursements

 

6

 

 

 

Schedule of Professional Fee and Expense Disbursements

 

7

 

2


 

SCHEDULE OF DEBTORS

 

The following entities have filed for bankruptcy in the Southern District of New York:

 

 

 

Case No.

 

Date Filed

Lead Debtor:

 

 

 

 

Lehman Brothers Holdings Inc. (“LBHI”)

 

08-13555

 

9/15/2008

 

 

 

 

 

Related Debtors:

 

 

 

 

LB 745 LLC

 

08-13600

 

9/16/2008

PAMI Statler Arms LLC

 

08-13664

 

9/23/2008

Lehman Brothers Commodity Services Inc.

 

08-13885

 

10/3/2008

Lehman Brothers Special Financing Inc.

 

08-13888

 

10/3/2008

Lehman Brothers OTC Derivatives Inc.

 

08-13893

 

10/3/2008

Lehman Brothers Derivative Products Inc.

 

08-13899

 

10/5/2008

Lehman Commercial Paper Inc.

 

08-13900

 

10/5/2008

Lehman Brothers Commercial Corporation

 

08-13901

 

10/5/2008

Lehman Brothers Financial Products Inc.

 

08-13902

 

10/5/2008

Lehman Scottish Finance L.P.

 

08-13904

 

10/5/2008

CES Aviation LLC

 

08-13905

 

10/5/2008

CES Aviation V LLC

 

08-13906

 

10/5/2008

CES Aviation IX LLC

 

08-13907

 

10/5/2008

East Dover Limited

 

08-13908

 

10/5/2008

Luxembourg Residential Properties Loan Finance S.a.r.l

 

09-10108

 

1/7/2009

BNC Mortgage LLC

 

09-10137

 

1/9/2009

LB Rose Ranch LLC

 

09-10560

 

2/9/2009

Structured Asset Securities Corporation

 

09-10558

 

2/9/2009

LB 2080 Kalakaua Owners LLC

 

09-12516

 

4/23/2009

 

The Chapter 11 case of Fundo de Investimento Multimercado Credito Privado Navigator Investimento No Exterior (Case No: 08-13903) has been dismissed.

 

The Chapter 11 case of Lehman Brothers Finance SA (Case No: 08-13887) has been dismissed.

 

3


 

LEHMAN BROTHERS HOLDINGS INC., (“LBHI”), AND OTHER DEBTORS AND OTHER CONTROLLED ENTITIES

 

BASIS OF PRESENTATION

SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS

SEPTEMBER 1, 2009 TO SEPTEMBER 30, 2009

 

The information and data included in this Report are derived from sources available to Lehman Brothers Holdings Inc. (the “Company”) and its other subsidiaries that have filed proceedings under Chapter 11 of the Bankruptcy Code (collectively, the “Debtors” or the “Estate”).  The Debtors’ chapter 11 cases have been consolidated for procedural purposes only and are being jointly administered pursuant to Rule 101(b) of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”). The Debtors have prepared this presentation, as required by the Office of the United States Trustee, based on the information available to The Debtors at this time, but note that such information may be incomplete and may be materially deficient in certain respects.  This Monthly Operating Report, (“MOR”), is not meant to be relied upon as a complete description of the Debtors, their business, condition (financial or otherwise), results of operations, prospects, assets or liabilities. The Debtors reserve all rights to revise this report.

 

1.     This MOR is not prepared in accordance with U.S. generally accepted accounting principles (GAAP). This MOR should be read in conjunction with the financial statements and accompanying notes in the Company’s annual and quarterly reports that were filed with the United States Securities and Exchange Commission.

 

2.     This MOR is not audited and will not be subject to audit or review by the Company’s external auditors at any time in the future.

 

3.     The beginning and ending balances include cash in demand-deposit accounts (DDA), money-market funds (MMF), treasury bills, and other investments.

 

4.     Intercompany transfers between Lehman entities are listed as disbursements for the paying entity and receipts for the receiving entity.

 

5.     The following Debtors have not been included as Debtors in this MOR Report:

 

a.     PAMI Statler Arms LLC (“PAMI”) — Books and records for PAMI are maintained separately and not in a manner similar to the majority of the Company’s subsidiaries. This entity does not maintain a separate cash account.

 

b.     Lehman Brothers Finance SA (“LBF”) — Subsequent to its bankruptcy filing on October 3, 2008, LBF became subject to an insolvency proceeding in Switzerland.

 

c.     Fundo de Investimento Multimercado Credito Privado Navigator Investimento — Motion was granted on February 24, 2009 to dismiss the Chapter 11 case of this entity.

 

4


LEHMAN BROTHERS HOLDINGS INC. and Other Debtors and Other Controlled Entities

Schedule of Cash Receipts and Disbursements

September 1, 2009 - September 30, 2009

Unaudited ($ in millions)

 

Legal Entity

 

Filing
Date

 

Beginning Cash &
Investments
(9/01/09)

 

Receipts

 

Transfers (b)

 

Disbursements

 

FX
Fluctuation (c)

 

Hedging
Fluctuation (d)

 

Ending Cash &
Investments
(9/30/09) (e)

 

Lehman Brothers Holdings Inc.

 

9/15/2008

 

$

2,531

 

$

752

(f)

$

6

 

$

(742

)(g)

$

3

 

$

—

 

$

2,550

 

LB 745 LLC

 

9/16/2008

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

Lehman Brothers Special Financing Inc. (“LBSF”)

 

10/3/2008

 

4,709

 

380

 

10

 

(69

)(h)

3

 

(8

)

5,025

 

Lehman Brothers Commodity Services Inc. (“LBCS”)

 

10/3/2008

 

1,144

 

26

 

—

 

—

 

1

 

—

 

1,171

 

Lehman Brothers OTC Derivatives Inc. (“LOTC”)

 

10/3/2008

 

165

 

1

 

—

 

—

 

—

 

—

 

166

 

Lehman Commercial Paper Inc. (“LCPI”)

 

10/5/2008

 

2,912

 

641

 

—

 

(307

)(i)

1

 

—

 

3,247

 

Lehman Brothers Commercial Corporation (“LBCC”)

 

10/5/2008

 

415

 

12

 

—

 

—

 

—

 

—

 

427

 

Lehman Brothers Derivative Products Inc. (“LBDP”)

 

10/5/2008

 

389

 

1

 

—

 

—

 

—

 

—

 

390

 

Lehman Brothers Financial Products Inc. (“LBFP”)

 

10/5/2008

 

437

 

1

 

—

 

—

 

—

 

 

 

438

 

CES Aviation LLC

 

10/5/2008

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

CES Aviation V LLC

 

10/5/2008

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

CES Aviation IX LLC

 

10/5/2008

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

East Dover Limited

 

10/5/2008

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

Lehman Scottish Finance L.P.

 

10/5/2008

 

2

 

—

 

—

 

—

 

—

 

—

 

2

 

Luxembourg Residential Properties Loan Finance

 

1/7/2009

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

BNC Mortgage LLC

 

1/9/2009

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

LB Rose Ranch LLC

 

2/9/2009

 

2

 

—

 

—

 

—

 

—

 

—

 

2

 

Structured Asset Securities Corporation (“SASCO”)

 

2/9/2009

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

LB 2080 Kalakaua Owners LLC

 

4/23/2009

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

Total Debtor Cash and Investment Flows excl. International (a)

 

 

 

$

12,706

 

$

1,814

 

$

16

 

$

(1,118

)

$

8

 

$

(8

)

$

13,418

 

Non-Debtor Cash and Investment Balances excl. International (a)

 

 

 

1,123

 

 

 

 

 

 

 

 

 

 

 

1,174

 

International Cash and Investment Balances (j)

 

 

 

878

 

 

 

 

 

 

 

 

 

 

 

1,065

 

Total Cash and Investment Balances

 

 

 

$

14,707

 

 

 

 

 

 

 

 

 

 

 

$

15,657

 

Notes:

(a)          Represents bank accounts managed and reconciled by Lehman US operations. Foreign currency cash flows are reflected in USD equivalents.

(b)         Reflects transfers from bank accounts managed in other regions to the US.

(c)          Reflects fluctuation in value in foreign currency bank accounts.

(d)         Reflects fluctuation in value of futures accounts (realized gain or loss) on court approved hedging activity.

(e)          Ending cash and investments balances include approximately $2.3 billion of cash associated with pledged assets, court order segregated accounts, funds administratively held by banks, and other identified funds which may not belong to the Debtor or non-Debtor subsidiaries. These amounts are preliminarily estimated as follows: Debtors - LBHI $255 million, LBSF $527 million, LBCS $43 million, LCPI $1.3 billion, LBCC $9 million, LBDP $3 million, LBFP $8 million, Lehman Scottish Finance $2 million; Non-Debtors $79 million; and International $83 million, and are subject to adjustment.

(f)            Includes $598 million in receipts from Aurora Bank associated with court approved repo financing transactions. On 9/30/09, $312 million in principal was still outstanding with Aurora Bank.

(g)         Reflects ordinary course outflows and other court approved disbursements, including $636 million in disbursements to Aurora Bank associated with court approved repo financing transactions.

(h)         Reflects the payment made by LBSF to exercise an option (LBSF paid $68 million and received securities which were subsequently sold for $76 million).

(i)             LCPI, in its capacity as loan agreement agent, makes pass-along disbursements of principal and interest to loan syndicate participants.

(j)             Reflects Debtor and non-Debtor cash and investment balances. Ending balance of $1,065 million includes Asia balance of $980 million, South America balance of $24 million and legacy Europe balance of $61 million.

 

5


 

LEHMAN BROTHERS HOLDINGS INC. (“LBHI”)

 

BASIS OF PRESENTATION

SCHEDULE OF PROFESSIONAL FEE AND EXPENSE DISBURSEMENTS

DATED FROM FILING DATE TO SEPTEMBER 30, 2009

 

The information and data included in this Report are derived from internal systems maintained by Lehman Brothers Holdings Inc. (the “Company”).  The Company, and its other subsidiaries that have filed proceedings under Chapter 11 of the Bankruptcy Code (collectively, the “Debtors” or the “Estate”), have had their chapter 11 cases consolidated for procedural purposes only and are being jointly administered pursuant to Rule 101(b) of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”). The Debtors have prepared this presentation, as required by the Office of the United States Trustee, based on information from the Debtors internal systems, but note that such information may be incomplete in certain respects and the Debtors reserve all rights to revise this report.  This MOR is not meant to be relied upon as a complete description of the Debtors, their business, condition (financial or otherwise), results of operations, prospects, assets or liabilities.

 

1.     This MOR is not prepared in accordance with U.S. generally accepted accounting principles (GAAP). This MOR should be read in conjunction with the financial statements and accompanying notes in the Company’s annual and quarterly reports that were filed with the United States Securities and Exchange Commission.

 

2.     This MOR is not audited and will not be subject to audit or review by the Company’s external auditors at any time in the future.

 

3.     The professional fee disbursements presented in this report reflect the date of actual cash payments to professional service providers.  The Debtors have incurred additional professional fee expenses during the reporting period that will be reflected in future MORs as cash payments are made to providers.

 

6


LEHMAN BROTHERS HOLDINGS INC.

Schedule of Professional Fee and Expense Disbursements (a)

September 2009

Unaudited ($ in thousands)

 

 

 

 

 

Sep-09

 

Filing Date
Through Sep-09 (b)

 

Debtors - Section 363 Professionals

 

 

 

 

 

 

 

Alvarez & Marsal LLC

 

Interim Management

 

$

18,494

 

$

169,246

 

Kelly Matthew Wright

 

Art Consultant and Auctioneer

 

—

 

38

 

Natixis Capital Markets Inc.

 

Derivatives Consultant

 

1,117

 

6,027

 

Debtors - Section 327 Professionals

 

 

 

 

 

 

 

Bingham McCutchen LLP (c)

 

Special Counsel - Tax

 

419

 

6,044

 

Bortstein Legal LLC

 

Special Counsel - IT and Other Vendor Contracts

 

166

 

1,853

 

Curtis, Mallet-Prevost, Colt & Mosle LLP

 

Special Counsel - Conflicts

 

1,191

 

10,263

 

Ernst & Young LLP

 

Audit and Tax Services

 

116

 

1,160

 

Huron Consulting

 

Tax Services

 

291

 

1,136

 

Jones Day

 

Special Counsel

 

1,935

 

7,759

 

Lazard Freres & Co.

 

Investment Banking Advisor

 

321

 

11,864

 

McKenna Long & Aldridge LLP

 

Special Counsel - Commercial Real Estate Lending

 

383

 

1,919

 

Reilly Pozner LLP

 

Special Counsel - Mortgage Litigation and Claims

 

125

 

1,160

 

Simpson Thacher & Bartlett LLP

 

Special Counsel - SEC Reporting, Asset Sales, and Congressional Testimony

 

268

 

1,730

 

Weil Gotshal & Manges LLP

 

Lead Counsel

 

10,057

 

98,546

 

Debtors - Claims and Noticing Agent

 

 

 

 

 

 

 

Epiq Bankruptcy Solutions LLC

 

Claims Management and Noticing Agent

 

205

 

2,773

 

Creditors - Section 327 Professionals

 

 

 

 

 

 

 

FTI Consulting Inc.

 

Financial Advisor

 

1,459

 

13,551

 

Houlihan Lokey Howard & Zukin Capital Inc.

 

Investment Banking Advisor

 

348

 

4,355

 

Milbank Tweed Hadley & McCloy LLP

 

Lead Counsel

 

2,991

 

29,202

 

Quinn Emanuel Urquhart Oliver & Hedges LLP

 

Special Counsel - Conflicts

 

—

 

2,935

 

Richard Sheldon, Q.C.

 

Special Counsel - UK

 

68

 

68

 

Examiner - Section 327 Professionals

 

 

 

 

 

 

 

Duff & Phelps LLC

 

Financial Advisor

 

2,854

 

13,629

 

Jenner & Block LLP

 

Examiner

 

4,674

 

17,359

 

Fee Examiner

 

 

 

 

 

 

 

Feinberg Rozen LLP

 

Fee Examiner

 

76

 

267

 

Total Non-Ordinary Course Professionals

 

 

 

47,560

 

402,883

 

Debtors - Ordinary Course Professionals

 

 

 

2,885

 

14,126

 

US Trustee Quarterly Fees

 

 

 

—

 

378

 

Total Professional Fees and UST Fees

 

 

 

$

50,445

 

$

417,387

 

(a)

 

All professional fees have been paid by LBHI; however, a portion has been charged back to Debtor and non-Debtor subsidaries based on the direct costs associated with each entity and an allocation methodology.

(b)

 

The figures reflected in this table represent cash disbursements from LBHI’s filing date through the end of September 2009 and do not include holdback amounts required by court order for Non-Ordinary Course Professionals. The figures do not include accruals.

(c)

 

McKee Nelson LLP merged on August 1, 2009 with Bingham McCutchen LLP, with the combined firm using the Bingham McCutchen name.

 

7