The United States Bankruptcy Court for the Southern District of New York, overseeing the bankruptcy cases of Lehman Brothers Holdings Inc. and its affiliated debtors (collectively, the “Debtors”), entered an order on July 2, 2009 (the “Bar Date Order”), establishing September 22, 2009, at 5:00 p.m. (Eastern Time) as the deadline for the filing of claims against the Debtors (the “Bar Date”).

With the economic crisis leading to the failure of many businesses, bankruptcy cases are on the rise. In many of the cases grabbing headlines, such as Lehman Brothers, Nellson Nutraceutical, New Century and SemCrude, courts have shown a willingness to appoint examiners to investigate, report on and make recommendations regarding possible issues of mismanagement, fraud or other improprieties relating to the affairs of the debtor or its former or current management.

The court overseeing the chapter 11 bankruptcy cases of Lehman Brothers Holdings Inc. and various subsidiaries (the “Debtors”), has entered an order establishing deadlines and procedures for filing claims against the Debtors. In terms of procedural requirements, the order places unusual burdens on parties whose claims are based on derivative contracts and guarantees.

Summary

This briefing summarizes the recent U.S. Bankruptcy Court order establishing bar dates for creditors filing claims in relation to debts owed to them by Lehman Brothers entities in Chapter 11 bankruptcy proceedings. Specifically, this briefing discusses who must file a proof of claim, how to file the proof of claim, and the special requirements for claims in respect of derivative contracts, guarantees and Lehman program securities.

On July 2, 2009 the United States Bankruptcy Court for the Southern District of New York issued an order establishing September 22, 2009 as the deadline for filing proofs of claims against Lehman Brothers Holdings Inc. or any of its debtor affiliates (the “Order”). The Order provides that any holder of a claim against the Debtors who fails to file a proof of claim before the September 22, 2009 deadline will be forever barred from asserting such claim thereafter.

In a recently filed motion in the United States Bankruptcy Court Southern District of New York (the “Motion”), Lehman Brothers Holdings Inc. (“LBHI”) is seeking to compel Metavante Corporation (“Metavante”) to perform its obligations under a swap agreement between Metavante and Lehman Brothers Special Financing Inc.

On September 17, 2009, the U.S.

The United States Bankruptcy Court for the Southern District of New York entered an order on Sept. 17, 2009, granting a motion filed by Lehman Brothers Special Financing Inc. (“LBSF”) to compel Metavante Corporation (“Metavante”) to continue to make payments to LBSF under an ISDA Master Agreement.

The judge responsible for the Lehman bankruptcy proceedings in the United States has found that the provisions of the US bankruptcy code that exempt swap agreements and master netting agreements from the application of the Code's automatic stay and other relevant provisions do not permit a party to an ISDA Master Agreement to suspend performance under Section 2 (a) (iii) of the master agreement.

On September 17, 2009 Judge Peck of the United States Bankruptcy Court for the Southern District of New York issued two orders that may significantly impact parties who held, or still currently hold, derivative contracts with Lehman Brothers Special Financing Inc. (LBSF) or any of the other debtors in the Lehman Brothers bankruptcy cases (the Debtors).