Lehman Brothers seeks court approval of compromise with Fenway Capital

By Lisa Kerner

Charlotte, N.C., March 26 - Lehman Brothers Holdings Inc. and its affiliated debtors asked the court to approve a compromise with Fenway Capital, LLC, Fenway Funding, LLC, Hudson Castle Group Inc. and Deutsche Bank Trust Co. Americas, according to a filing with the U.S. Bankruptcy Court for the Southern District of New York.

The proposed compromise will result in a repurchase of certain assets under a repurchase agreement with Fenway Capital and a subsequent termination of the repurchase agreement and the cancellation of a commercial paper program with Fenway Funding, the filing said.

According to the filing, termination of the repurchase agreement and cancellation of the commercial paper program would allow debtor Lehman Commercial Paper Inc. to end the litigation regarding the repurchase agreement in the SunCal cases and enable Fenway Capital to seek dismissal of certain claims against it in the SunCal adversary proceeding.

New York-based Lehman Brothers Holdings Inc. was the fourth-largest investment bank in the United States. The company filed for bankruptcy on Sept. 15, 2008. Its Chapter 11 case number is 08-13555.

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