08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 30 of 155 EXECUTION COPY SETTLEMENT AGREEMENT This settlement agreement (“Agreement”) is entered into on this 16th day of February, 2012, among the Debtors1, Lehman ALI, Inc., a Delaware corporation (“Lehman ALI”); Appalachian Asset Management Corp., a Delaware corporation (“Appalachian”; and together with the Debtors and Lehman ALI, the “Lehman U.S. Parties”); Lehman Re Ltd. (“Lehman Re”), a Bermuda corporation in provisional liquidation, acting by its Joint Provisional Liquidators (“JPLs”)2, Dan Yoram Schwarzmann and Garth Andrew Calow, as agents for Lehman Re and acting solely in that capacity without personal liability; Congress Life Insurance Company, an Arizona insurance company (“Congress Life”); and Pulsar Re, Ltd. (“Pulsar”) (the Debtors, Lehman ALI, Appalachian, Lehman Re, Congress Life, and Pulsar may be referred to collectively as the “Parties, and each individually as a “Party”). RECITALS WHEREAS, on September 15, 2008 (the “Petition Date”), LBHI commenced a voluntary case under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”), in the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”), that is presently pending under Case No. 08-13555 (JMP), and is being jointly administered with the Chapter 11 cases of certain affiliates and subsidiaries of LBHI, including LCPI (collectively, the “Chapter 11 Cases”); WHEREAS, on September 23, 2008, a winding-up proceeding (the “Bermuda Proceeding”) was commenced by Lehman Re in the Supreme Court of Bermuda (the “Bermuda Court”); WHEREAS, by orders of the Bermuda Court, Dan Yoram Schwarzmann and Garth Andrew Calow were appointed as joint provisional liquidators of Lehman Re; WHEREAS, on October 5, 2008, LCPI commenced in the Bankruptcy Court a voluntary case under chapter 11 of the Bankruptcy Code (the “LCPI Petition Date”); 1 As used herein, “Debtors” means Lehman Brothers Holdings Inc. (“LBHI”); Lehman Brothers Special Financing Inc. (“LBSF”); Lehman Commercial Paper Inc. (“LCPI”); Lehman Brothers Commercial Corporation (“LBCC”); Lehman Brothers Financial Products Inc.; Lehman Brothers OTC Derivatives Inc.; Lehman Brothers Derivative Products Inc.; Lehman Brothers Commodity Services Inc.; Lehman Scottish Finance L.P.; CES Aviation LLC; CES Aviation V LLC; CES Aviation IX LLC; East Dover Limited; Luxembourg Residential Properties Loan Finance S.a.r.l; BNC Mortgage LLC; Structured Asset Securities Corporation; LB Rose Ranch LLC; LB 2080 Kalakaua Owners LLC; Merit LLC; LB Somerset LLC; LB Preferred Somerset LLC; LB 745 LLC; and PAMI Statler Arms LLC. 2 As used herein, “JPLs” shall include Dan Yoram Schwarzmann, Garth Andrew Calow, and any preceding provisional liquidators of Lehman Re acting jointly or severally, and any successors to the provisional liquidators, whether provisionally or permanently appointed. 08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 31 of 155 WHEREAS, on August 6, 2009, the JPLs on behalf of Lehman Re filed a Verified Petition Under Chapter 15 of the Bankruptcy Code for Recognition of Foreign Representative and Foreign Main Proceeding and for Additional Relief Under 11 U.S.C. Section 1521 [Docket No. 2], In re Lehman Re Ltd., Case No. 09-14884 (JMP) (Bankr. S.D.N.Y.) (the “Lehman Re Chapter 15 Case”), and on September 24, 2009, the Bankruptcy Court entered an Order Granting Recognition of Foreign Representative and Foreign Main Proceeding and for Additional Relief under 11 U.S.C. Section 1521 [Docket No. 56 in the Lehman Re Chapter 15 Case]; WHEREAS, LCPI and Lehman Re, among others, are parties to that certain Master Repurchase Agreement dated as of July 9, 1999 (the “MRA”), pursuant to which LCPI committed to sell to Lehman Re, upon the terms as set forth in the MRA, certain residential and commercial mortgage and mezzanine loans, which are listed on the attached Exhibit A (collectively, the “Mortgage Loans”); WHEREAS, pursuant to the MRA, Lehman Re transferred cash to LCPI in exchange for the purchase of certain assets, including, without limitation, the Mortgage Loans. WHEREAS, on September 17, 2008 (the “Lehman Re Acquisition Date”), Lehman Re (i) declared an Event of Default (as defined in the MRA), (ii) notified LCPI in writing that it was in default under the MRA, (iii) advised The Bank of New York, as Master Custodian (as defined in the MRA) that such an Event of Default had occurred, and (iv) directed The Bank of New York, as Master Custodian, to transfer the Loan Documents then in the possession of the Master Custodian into the name of Lehman Re; WHEREAS, in accordance with this instruction, the Master Custodian issued written notices to the sub-custodians, instructing them, inter alia to follow the instructions of Lehman Re concerning the Mortgage Loans; WHEREAS, as of the Petition Date, LBHI was no longer an owner of the Mortgage Loans, and, as of the LCPI Petition Date, LCPI was no longer an owner of the Mortgage Loans; WHEREAS, Lehman Re, LBHI, LCPI, and Lehman ALI have entered into that certain Settlement Agreement (the “2009 Settlement Agreement”) dated as of November 4, 2009, pursuant to which the parties thereto have, among other things, resolved certain, but not all, disputes among the Parties with respect to the MRA and the Mortgage Loans; WHEREAS, by order, dated July 2, 2009 [Docket No. 4271] (the “Bar Date Order”), the Bankruptcy Court established September 22, 2009 as the deadline to file proofs of claim (each a “Proof of Claim”) against the Debtors in the Bankruptcy Cases; -2- 08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 32 of 155 WHEREAS, Lehman Re filed Proof of Claim No. 28305 against LCPI (the “LCPI Claim”) relating to certain alleged obligations of LCPI under the MRA in an unliquidated amount; WHEREAS, Lehman Re filed Proof of Claim No. 28306 against LBSF (the “LBSF Claim”) relating to, among other things, certain alleged obligations of LBSF under certain derivative contracts and with respect to certain alleged intracompany receivables in an aggregate amount of not less than $52,398,681.71; WHEREAS, Lehman Re filed Proof of Claim No. 28307 against LBHI (the “LBHI Claim”) relating to, among other things, certain alleged obligations of LBHI under that certain Net Worth Maintenance Agreement between LBHI and Lehman Re dated October 26, 2007 (the “NWMA”) in an unliquidated amount; WHEREAS, Lehman Re filed Proof of Claim No. 28308 against LBCC (the “LBCC Claim”, and together with the LCPI Claim, the LBSF Claim, and the LBHI claim, the “Lehman Re Claims”) relating to, among other things, certain alleged intercompany receivable obligations of LBCC, in the amount of $89,912,687.14; WHEREAS, Appalachian has asserted a claim against Lehman Re in the amount of $1,583,796.17 relating to certain alleged intercompany receivable obligations (the “Appalachian Claim”); WHEREAS, Appalachian has asserted a claim against Congress Life in the amount of $1,283.00 relating to certain alleged intercompany receivable obligations (the “Appalachian/Congress Claim”); WHEREAS, Pulsar filed Proof of Claim No. 29770 against LBHI (the “Pulsar LBHI Claim”) in an unliquidated amount; WHEREAS, Pulsar filed Proof of Claim No. 27453 against LCPI (the “Pulsar LCPI Claim”) in an unliquidated amount; WHEREAS, on December 16, 2008, the Bankruptcy Court entered an Order Pursuant to Sections 105 and 365 of the Bankruptcy Code to Establish Procedures for the Settlement or Assumption and Assignment of Prepetition Derivative Contracts (as amended and/or supplemented from time to time, the “Derivatives Order”); WHEREAS, Pulsar filed Proof of Claim No. 12711 against LBSF in the amount of $1,175,000.00 in respect of one or more derivative transactions, which claim has heretofore been compromised, settled and allowed pursuant to the Derivatives Order as an unsecured claim against LBSF in the amount of $450,000.00 (the “Pulsar Allowed LBSF Claim”, and collectively with the Pulsar LBHI Claim and the Pulsar LCPI Claim, the “Pulsar Claims”); -3- 08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 33 of 155 WHEREAS, on September 1, 2011, the Debtors filed the Third Amended Joint Chapter 11 Plan of Lehman Brothers Holdings Inc. and its Affiliated Debtors, ECF No. 19627; WHEREAS, on December 5, 2011, the Debtors filed their Modified Third Amended Joint Chapter 11 Plan of Lehman Brothers Holdings Inc. and its Affiliated Debtors, ECF No. 22931 (as subsequently supplemented, amended, or modified, including by the “Plan Supplement” [as such term is defined in said plan], the “Plan”); WHEREAS, on December 6, 2011, the Bankruptcy Court entered an order confirming the Plan, ECF No. 23023; WHEREAS, on March 25, 2010, Aetna Life Insurance Company (“Aetna”), a Lehman Re creditor, commenced litigation against Appalachian in the Supreme Court of the State of New York, captioned Aetna Life Insurance v. Appalachian Asset Management Corp. et al, Index No. 103913/2010 (N.Y. Sup. Ct.) (the “Appalachian Litigation”); WHEREAS, on June 4, 2010, the JPLs commenced litigation against the Broadway Parties (as defined below) relating to the commercial loan secured by the property commonly known as “237 Park”, captioned D. Geoffrey Hunter and Dan Schwarzmann, as Joint Provisional Liquidators of Lehman Re, Ltd. v. Broadway Partners Real Estate Fund III, L.P., et al., Case No. 09-14884 (JMP), Adv. Proc. No. 10- 03279 (the “237 Adversary Proceeding”); and WHEREAS, the Parties have engaged in good faith negotiations for the purpose of reaching a mutually satisfactory agreement for the compromise and settlement of their disputes, which include the resolution of their respective claims and the sale of certain of Lehman Re’s assets pursuant to the terms set forth below. Now, therefore, upon the foregoing recitals, which are incorporated as though fully set forth herein, and in consideration of the mutual covenants, conditions and provisions set forth below, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties hereto hereby agree as follows: ARTICLE I DEFINITIONS 1.1 In this Agreement (including the recitals hereto) and in the Schedules and Exhibits hereto, except as expressly provided or as the context otherwise requires: “Affiliate” means, with respect to any Person, any Person directly or indirectly controlling, controlled by or under direct or indirect common control with, such -4- 08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 34 of 155 Person. A Person will be deemed to control another Person if such Person possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of such other Person, whether through the ownership of voting securities, partnership interests or other equity interests, by contract or otherwise. “Agreement” shall have the meaning assigned to such term in the first paragraph, and shall include all Schedules and Exhibits hereto. “Assignment and Assumption” shall mean with respect to each Repurchased Loan, an Assignment and Assumption in substantially the form of Exhibit E attached hereto. “Bankruptcy Code” means title 11 of the United States Code, as the same may be amended from time to time. “Broadway Parties” means Broadway Partners Fund Manager, LLC; Broadway Partners Fund GP II, L.P.; Broadway Partners Fund GP III, L.P.; and Scott Lawlor. “Bankruptcy Rules” means the Federal Rules of Bankruptcy Procedure. “Business Day” means any day that is not a Saturday, Sunday or any other day on which banks in the State of New York are authorized or required by law to close. “Closing” shall have the meaning assigned to such term in Section 5.3 hereof. “Closing Date” shall have the meaning assigned to such term in Section 5.3 hereof. “Code” means the Internal Revenue Code of 1986, as amended. “Collateral Property” shall mean (a) in the case of any Repurchased Loan which is a mortgage loan, the real property, together with the improvements erected or to be erected thereon and related personal and other property which secures the Repurchased Loan and (b) in the case of any Repurchased Loan which is a mezzanine loan, the pledge of equity interest in the borrower and/or other entities which secures such Repurchased Loan. “Consent” means any consent, approval, authorization, waiver, permit, grant, franchise, concession, agreement, license, order, registration, declaration, filing, or notice of, with or to any Person. “Effective Date” has the meaning ascribed to it in Section 16.1 of this Agreement. -5- 08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 35 of 155 “Escrow Accounts” means those accounts established and maintained by Lehman Re or any Affiliate of, agent of, or loan servicer or any other Person for the benefit of Lehman Re for the deposit and retention of all collections of taxes, assessments, ground rents, hazard and other insurance and comparable items on account of the Repurchased Loans. “Governmental Approval” means any Consent of or with any Governmental Authority. “Governmental Authority” means any nation or government (foreign or domestic), and any state or political subdivision thereof; any self-regulatory organization acting under color of authority granted under any Legal Requirement; and any court, tribunal, arbitrator, authority, agency, commission, official or other instrumentality of the United States or any other nation, or any foreign or domestic, state, county, city or other political subdivision thereof. “Legal Requirements” in respect of any Person means all (i) constitutions, treaties, statutes, laws, ordinances, codes, rules, regulations, standards, judgments, decrees, writs, rulings, injunctions, orders and other requirements of any Governmental Authority, (ii) Governmental Approvals and (iii) orders, decisions, injunctions, judgments, awards and decrees of or agreements with any Governmental Authority. “Lien” means any encumbrance, charge, security interest, mortgage, restriction, pledge, hypothecation, voting trust agreement, option, right of first offer or refusal, proxy or lien, including but not limited to such Liens as may arise under any contracts. “Loan Documents” means collectively, (i) all Notes, Mortgages, pledge agreements, loan agreements, credit agreements, security agreements, environmental indemnities, guaranties, intercreditor agreements, deeds of trust, and all other documents, instruments and agreements evidencing or securing any of the Repurchased Loans, and provided by or on behalf of the Lehman U.S. Debtors to Lehman Re in connection with the MRA and/or the 2009 Settlement Agreement or delivered to Lehman Re by certain custodians with respect to the Repurchased Loans, (ii) any amendments to such documents, entered into, executed and/or delivered by or on behalf of Lehman Re from and after the Lehman Re Acquisition Date, and (iii) any consents, releases, modifications or waivers executed and/or delivered by or on behalf of Lehman Re under or in connection with any of the foregoing documents from and after the Lehman Re Acquisition Date. In the event any such document also secures or relates to one or more other loans which is not one of the Repurchased Loans, such document shall be deemed a Loan Document, however, only such portion thereof securing or relating to the Repurchased Loan shall be assigned hereunder by the Transferor. Notwithstanding the foregoing, Loan Documents shall not include any information that is privileged, nor any other Lehman Re internal documents, materials or information created by, and -6- 08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 36 of 155 communicated solely among, Lehman Re, the JPLs, their professional advisors and/or their counsel. “Loan Files” mean collectively, (i) any formal default or other material notices or correspondence with respect to the Repurchased Loans sent or received by Lehman Re or any of its servicers, custodians, agents, or counsel after the Lehman Re Acquisition Date, (ii) any servicing reports, title search updates, environmental or other third party reports (such as appraisals, valuations, environmental and engineering reports) with respect to the Repurchased Loans within Lehman Re’s possession or control or in the possession or control of any of Lehman Re’s servicers, custodians, agents, representatives, or counsel, and (iii) a current loan servicer report with respect to each of the Repurchased Loans, including the then current balance, applicable interest rate, accrued interest and history of payment activity on a monthly basis for the period from and after the Lehman Re Acquisition Date; provided, however, that notwithstanding the foregoing, Loan Files shall not include any information that is privileged, nor any other Lehman Re internal documents, materials or information created by, and communicated solely among, Lehman Re, the JPLs, their professional advisors and/or their counsel. “Losses” means any and all losses, liabilities, damages, fines, penalties, fees, amounts paid in settlement, Taxes, reasonable costs (including costs of investigation or enforcement), reasonable expenses and claims (including, without limitation, interest, reasonable fees and disbursements of counsel, witness fees and court costs). “Material Adverse Effect” means (a) a material adverse effect on the business, operations, assets, liabilities, operating results or financial condition of the applicable party or its assets, or (b) a material adverse effect on the ability of such party to execute and deliver this Agreement or to perform its obligations hereunder. “Mortgage” shall mean the mortgage, deed of trust or other security instrument creating a lien upon the real property described therein, and the improvements located on such real property, which secures a Repurchased Loan. “Note” shall mean the promissory note or similar instrument which evidences a Repurchased Loan. “Pacific Point Loan Agreement” shall mean that certain Term Loan and Revolving Line of Credit Loan Agreement, dated as of February 16, 2006, made by and between SJD Partners, Ltd., as borrower, and Lehman ALI, as Agent and sole Lender thereunder, as heretofore amended. “Pacific Point Loan Documents” shall mean the Loan Documents, as such term is defined in the Pacific Point Loan Agreement. “Pacific Point Project” shall mean the Project, as such term is defined in the Pacific Point Loan Agreement. -7- 08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 37 of 155 “Pacific Point Senior Loan” shall mean that certain loan made by Lehman ALI to SJD Partners, Ltd. in the maximum aggregate principal amount of $125,000,000.00, as evidenced by the Pacific Point Term Note, the Pacific Point Revolving Note and the Pacific Point Loan Agreement. “Pacific Point Revolving Note” shall mean the Revolving Note, as such term is defined in the Pacific Point Loan Agreement. “Pacific Point Term Note” shall mean that certain Secured Term Promissory Note, dated February 16, 2006, in the stated principal amount of $100,000,000.00, made by SJD Partners, Ltd. to the order of Lehman ALI, as endorsed to Lehman Re. “Person” means and includes an individual, corporation, partnership (limited or general), joint venture, association, trust, limited liability company, any other unincorporated organization or entity, or any Governmental Authority. “Pleadings” shall mean the documents listed in Rule 7(a) of the Federal Rules of Civil Procedure and any other document filed with the applicable court or other governmental authority in connection with any Pending Action. “Proceeds” means any consideration received from the sale, exchange, license, lease or other disposition of any specified asset or property, any value received as a consequence of the possession thereof, and any payment received from any insurer or other person or entity as a result of the destruction, loss, theft, damage or other involuntary conversion of whatever nature thereof and shall include (a) all properties or other assets acquired through foreclosure or deed in lieu of foreclosure and (b) all “proceeds” as defined in the Uniform Commercial Code as in effect in the jurisdiction in which the specified asset or property is located. “Tax” or “Taxes” means all taxes, charges, fees, levies, tariffs, charges, duties or other assessments, and all estimated payments thereof, including but not limited to income, excise, property, sales, use, value added, environmental, franchise, payroll, transfer, gross receipts, withholding, social security, and unemployment taxes, imposed by any foreign, federal, state, county or local government, or any subdivision or agency thereof, and any interest, penalty and expense relating to such taxes, charges, fees, levies or other assessments. “Transferor” shall mean Lehman Re. ARTICLE II SETTLEMENT OF CLAIMS 2.1 LCPI Claim. On the Effective Date, the LCPI Claim shall be allowed as an unsecured, non-priority affiliate claim against LCPI in the fixed, liquidated -8- 08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 38 of 155 amount of $490,000,000.00 (the “Allowed LCPI Claim”). The Allowed LCPI Claim shall not be subject to reconsideration, objection, reduction, increase, counterclaim, subordination, offset or recoupment, and shall be allowed on the Effective Date without necessity of any further filings or amendments. The Allowed LCPI Claim shall be classified under the Plan in LCPI Class 5C. 2.2 LBSF Claim. On the Effective Date, the LBSF Claim shall be allowed as an unsecured, non-priority affiliate claim against LBSF in the fixed, liquidated amount of $25,430,000.00 (the “Allowed LBSF Claim”). The Allowed LBSF Claim shall not be subject to reconsideration, objection, reduction, increase, counterclaim, subordination, offset or recoupment, and shall be allowed without necessity of any further filings or amendments. The Allowed LBSF Claim shall be classified under the Plan in LBSF Class 5C. 2.3 LBCC Claim. On the Effective Date, the LBCC Claim shall be allowed as an unsecured, non-priority affiliate claim against LBCC in the fixed, liquidated amount of $87,621,000.00 (the “Allowed LBCC Claim”). The Allowed LBCC Claim shall not be subject to reconsideration, objection, reduction, increase, counterclaim, subordination, offset or recoupment, and shall be allowed on the Effective Date without necessity of any further filings or amendments. The Allowed LBCC Claim shall be classified under the Plan in LBCC Class 5C. 2.4 LBHI Claim. On the Effective Date, the LBHI Claim shall be reduced and allowed as an unsecured, non-priority affiliate claim against LBHI in the fixed, liquidated amount of $415,000,000.00 (the “Allowed LBHI Claim”). The Allowed LBHI Claim shall not be subject to reconsideration, objection, reduction, increase, counterclaim, subordination, offset or recoupment, and shall be allowed on the Effective Date without necessity of any further filings or amendments. The Allowed LBHI Claim shall be classified under the Plan in LBHI Class 8. 2.5 Appalachian Claim. On or after the Effective Date, in full and complete satisfaction of the Appalachian Claim, Appalachian shall be allowed to file a claim against Lehman Re in the Bermuda Proceeding for $1,583,796.17, which claim shall be accepted as a valid claim against Lehman Re thereby entitling Appalachian to participate in a liquidation distribution pari passu with other unsecured creditors of Lehman Re (the “Accepted Appalachian Claim”), and such claim shall not be subject to reconsideration, objection, reduction, increase, counterclaim, subordination, offset, or recoupment. 2.6 Congress Life Claim. (a) Congress Life hereby acknowledges and agrees that (i) with respect to the Appalachian/Congress Claim, Congress Life is indebted to Appalachian in the amount of $1,283.00 and that such amount is currently due and payable by Congress Life to Appalachian, and (ii) as of the date hereof, Congress Life has absolutely no defenses, claims, rights of set-off or counterclaims against Appalachian in connection with or related to the Appalachian/Congress Claim, any and all of which Congress Life hereby expressly waives. -9- 08-13555-jmp Doc 25864 Filed 02/28/12 Entered 02/28/12 17:30:03 Main Document Pg 39 of 155 (b) On the Closing Date, Congress Life shall pay to Appalachian the sum of $1,283.00 by Federal wire transfer of immediately available funds to the account or accounts designated by Appalachian in satisfaction of the Appalachian/Congress Claim. 2.7 Other Claims. Other than the Allowed LCPI Claim, the Allowed LBSF Claim, the Allowed LBCC Claim, the Allowed LBHI Claim, the Allowed Pulsar LBSF Claim, and the Accepted Appalachian Claim, all other claims asserted or held by Lehman Re and/or Pulsar against the Debtors, and all claims asserted or held by the Lehman U.S. Parties against Lehman Re or Pulsar, shall be deemed expunged. 2.8 Title to Claims. (a) Lehman Re represents and warrants that it owns all of the legal and beneficial interest in, and has good, valid title to the LCPI Claim, the Allowed LCPI Claim, the LBSF Claim, the Allowed LBSF Claim, the LBCC Claim, the Allowed LBCC Claim, the LBHI Claim and the Allowed LBHI Claim, free and clear of all liens, claims, setoff rights of third parties, security interests, participations or encumbrances, and Lehman Re has not transferred or assigned to any other person any of the claims or receivables that are the subject of this Agreement, including, without limitation, the Allowed LCPI Claim, the Allowed LBSF Claim, the Allowed LBCC Claim, and the Allowed LBHI Claim, or any interest in any of the foregoing. (b) Appalachian represents and warrants that it owns all of the legal and beneficial interest in, and has good, valid title to the Appalachian Claim and the Appalachian/Congress Claim free and clear of all liens, claims, setoff rights of third parties, security interests, participations or encumbrances, and Appalachian has not transferred or assigned to any other person any of the claims or receivables that are the subject of this Agreement, including, without limitation, the Appalachian Claim, the Appalachian/Congress Claim or any interest in any of the foregoing. (c) Pulsar represents and warrants that it owns all of the legal and beneficial interest in, and has good, valid title to the Pulsar Claims free and clear of all liens, claims, setoff rights of third parties, security interests, participations or encumbrances, and Pulsar has not transferred or assigned to any other person any of the claims or receivables that are the subject of this Agreement, including, without limitation, the Pulsar Claims or any interest in any of the foregoing. 2.9 Transfer of Claims. (a) Unless this Agreement is terminated in accordance with the terms hereof, Lehman Re shall not, anytime prior to the Effective Date, transfer the LCPI Claim, the Allowed LCPI Claim, the LBSF Claim, the Allowed LBSF Claim, the LBCC Claim, the Allowed LBCC Claim, the LBHI Claim and/or the Allowed LBHI Claim, or any interest in any of the foregoing, or any rights or interests arising thereunder, or related thereto, including without limitation any instruments, rights to payments or other -10-