BANKRUPTCY REPORT. Bankruptcy report number 14 of the trustees of. Lehman Brothers Securities N.V. 13 August 2013

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1 BANKRUPTCY REPORT Bankruptcy report number 14 of the trustees of Lehman Brothers Securities N.V. 13 August 2013 Company name : Lehman Brothers Securities N.V. ( LBS ) Bankruptcy reference : E.J.F. 2/2009 Bankruptcy date : 30 January 2009 (the Bankruptcy Date ) Trustees : Mr. M.R.B. Gorsira and Mr. R.F. van Beemen (the Trustees ) Supervisory judge : Mr. A.J. Beukenhorst (the Supervisory Judge ) Activities Company :The objective of LBS is the structuring and issuing of derivative products linked to equity securities with the purpose to obtain a return on investment. Turnover data : Operating income according to the audited annual accounts 2007 (as of 30 November 2007): USD 21,895 Reporting period : 27 March 2013 up to and including 9 August 2013 Hours spent in period under review : 1, Total hours spent to date : 15,649.5 Summary of key issues - In this fourteenth bankruptcy report the Trustees provide an update regarding the progress of the settlement of the bankruptcy of LBS over the last 4 months and a general overview of the settlement of the LBS bankruptcy and the current status ( 6); - On 7 June 2013 the Trustees and the LBI Trustee have entered into a full and final settlement agreement, whereby LBS has an allowed customer claim in the LBI SIPA proceeding, in the amount of USD 2,416, ( 3);

2 2/8 - In this reporting period the Unfunded Securities have been canceled ( 4); and - On 8 July 2013 the Trustees made the first cash distribution to the creditors ( 5). 1. General 1.1 This is the fourteenth bankruptcy report of the Trustees. The information provided in this report is still subject to further investigation. Please be advised that information may have to be substantially amended following such further investigation. 1.2 With regard to the progress of the bankruptcy, the Trustees will communicate with the creditors via electronic mailings (through the electronic communication systems of the clearing systems) and via the website: Please note that the information and documents published on the website may (at any time) be subject to changes. 1.3 In this fourteenth bankruptcy report the Trustees provide an update regarding the progress of the settlement of the bankruptcy of LBS over the last 4 months and a general overview of the LBS bankruptcy and the current status. 1.4 Subjects discussed in the prior bankruptcy reports, but not discussed in this bankruptcy report, may however still be subject to further investigation and/or analysis, but no or little progress has been made regarding those subjects in this reporting period. 2. Lehman Brothers Securities N.V. 2.1 General LBS was incorporated on 31 October 2003 and was a wholly-owned subsidiary of Lehman Brothers Asia Holdings Limited, seated in Hong Kong, which in turn is a wholly-owned subsidiary of LBHI. LBHI is incorporated in Delaware in the United States and is the holding company of the worldwide operating Lehman Brothers group of companies. LBS had its corporate seat at E-Commerce Park, Vredenberg in Curacao. Mr. Jonathan Josef Knapp is listed in the Commercial Register as the Managing Director of LBS (the Managing Director ). The correspondence address of LBS is: Julianaplein 22, Willemstad, Curacao.

3 3/8 On 19 December 2011 the LBS Trustees Private Foundation has been incorporated in order to assist the Trustees with the winding up of the LBS estate. As per 21 December 2011, the LBS Trustees Private Foundation holds all shares in LBS. The board members of the LBS Trustees Private Foundation are Intertrust (Curacao) B.V., Mr. R.F. van Beemen and Mr. M.R.B. Gorsira. In addition to the incorporation of the LBS Trustees Private Foundation, LBS Trustees Private Foundation II has been incorporated on 26 January The LBS Trustees Private Foundation II has been incorporated to set up the necessary bank accounts in order to receive the distributions from the various debtors. The board members of the LBS Trustees Private Foundation II are Intertrust (Curacao) B.V., Mr. R.F. van Beemen and Mr. M.R.B. Gorsira. 2.2 Cause of bankruptcy On 15 September 2008 LBHI filed a petition in the U.S. Bankruptcy Court seeking relief under Chapter 11 of the United States Bankruptcy Code. The Lehman Brothers Group has subsequently closed all its subsidiaries globally. As LBS was then unable to pay its debts, LBS requested the Court of First Instance of the Netherlands Antilles, venue Curacao, that it be declared bankrupt on 30 January LBI Settlement On 7 June 2013 the Trustees and the LBI Trustee have entered into a full and final settlement agreement, whereby LBS has an allowed customer claim in the LBI SIPA proceeding, in the amount of USD 2,416, The settlement agreement has been approved by both the US Bankruptcy Court and the Supervisory Judge in Curacao. A copy of the settlement agreement can be found on the website. 4. Cancellation of the Unfunded Securities In December 2011 and February 2012 LBS and LBIE settled the issues around the Unfunded Securities. The Unfunded Securities were securities issued by LBS to LBIE, but they were never sold to investors and thus they remained unfunded. However, these securities were issued and they were registered with the clearing systems. As part of the settlement, the Unfunded Securities were segregated with the ultimate purpose to cancel them.

4 4/8 In this reporting period the Trustees in close cooperation with LBIE cancelled the Unfunded Securities. The cancellation process was completed on 26 June The total number of Unfunded Securities that was cancelled consisted of more than 300 ISINs and/or parts of ISINs with a nominal value of approximately USD 11 billion. For more details about the Unfunded Securities, please see the bankruptcy reports number 9 and First Interim Distribution On 6 May 2013 the Trustees filed the list of first interim distributions (uitdelingslijst), that was approved by the Supervisory Judge, at the Court House. This list was available for public inspection for 10 days. On 21 May 2013 the Trustees received the confirmation from the Court that no objections were filed against the list of first interim distributions (uitdelingslijst). The cash distribution on an ISIN-by-ISIN basis could only be processed if no Unfunded Securities were outstanding anymore. Due to unforeseen market circumstances that directly related to the cancellation the first interim distribution faced a delay of several weeks. In that respect the Trustees published a notice on 22 May With the record date being 1 July 2013, the Trustees made the first cash distribution of USD 591,743, to the creditors on 8 July The distribution rate was 11.40% per admitted unsecured claim. For more details about the first cash distribution, please see the notice of 6 May 2013 and the list of first interim distributions. 6. General overview In this paragraph the Trustees will provide the creditors with a general overview of the settlement of the LBS bankruptcy regarding the claims filed against other Lehman entities, legal proceedings (if any) and/or other issues that have been settled or that are still outstanding.

5 5/8 6.1 Claims filed by the Trustees As part of the settlement of the bankruptcy of LBS, the Trustees have filed multiple claims into the estates of the various Lehman Brothers Group entities. The nature of these claims varies from claims that are based on the Global Close Balance sheet 1 to claims that arise from contractual obligations. The claims that have been submitted by the Trustees against the Lehman debtors and the status of the settlement of those claims have been included in the table below. Debtor Claim Description Amount Status Settlement LBHI Intercompany Loan USD 6,050,451, USD 5,174 billion - Allowed Settlement Agreement, LBCC Derivatives USD 1,203,462 Allowed Settlement Agreement, LBSF Intercompany Receivable USD 74,628, Allowed Settlement Agreement, LBHI LBT Notes USD 11,286,793 Disallowed Settlement Agreement, LBHI Swap Guarantee USD 100,589, Disallowed Settlement Agreement, LBHI Board Resolution Guarantee USD 272,026, Disallowed Settlement Agreement, LBF Derivatives USD 78,423, Claim settled Settlement Agreement, 30 August 2012 LBFNA Derivatives USD 20,222, Claim settled Settlement Agreement, 30 August 2012 LBF/LBFNA Derivatives USD 12,076,021,652 Claim withdrawn by the Trustees Settlement Agreement, 30 August 2012 LBIE LBT notes USD 12,555,119 Claim filed on 23 April 2012 LBIE Intercompany USD 96,808,208 Claim filed on 23 April 2012 LBIE LBS notes USD 12,076,021,652 Claim withdrawn by the Trustees LBIE Trust assets Un-liquidated Claim withdrawn by the Trustees Under review and subject to further discussion Under review and subject to further discussion Deeds of Settlement, dated 22 December 2011 and 27 February 2012 Letter of 15 August Bankruptcy report number 3, 4.1, dated 24 November 2009

6 6/8 Debtor Claim Description Amount Status Settlement LBEL Intercompany claim under service agreement USD 6, GBP 3, (USD 6,959.21) - Allowed LBI Brokerage account USD 10,912, USD 2,416, Allowed customer claim in the LBI SIPA proceeding LBSAL; LBFAL, LBCCA, LBAL; and LBN Trust assets Un-liquidated Claim filed on 9 December 2010 Letter from LBEL of 10 September 2012 Settlement Agreement, 7 June 2013 Under review and subject to further discussion 6.2 Settlement agreements and legal issues With regard to the winding up of the LBS bankruptcy, the Trustees have entered into various (settlement) agreements. Furthermore, LBS is involved in two legal proceedings: (i) claim validation proceedings (renvooiprocedure) with a creditor HBN Law; and (ii) LBF lodged an appeal in cassation regarding a decision of the Supervisory Judge in relation to the compensation of certain costs incurred by a member of the LBS Creditors Committee. The Trustees expect to advise about these cases in more detail in the next bankruptcy report. A complete overview can be find in the schedule below. Counterparty Issue (Settlement) Agreement / Request Summary LBHI Access to LBS data Confidentiality agreement, dated 14 July 2010 U.S. Debtors Full and final settlement Settlement agreement + amendment to settlement agreement, dated 19 October 2011 respectively 23 March 2012 LBS requires access to data that is owned by LBS but in the custody, possession or control of LBHI in order to carry out its duties and for the orderly administration and wind down of the estate. The settlement agreement provides LBS with (i) an allowed intercompany claim of USD5.174 billion against LBHI; (ii) an allowed intercompany claim of USD74.6 million against LBSF; and (iii) an allowed derivative claim of USD1.3 million against LBCC.

7 7/8 Counterparty Issue (Settlement) Agreement / Request Summary LBIE Custody LBS Securities Custody agreement, dated 22 December 2011 LBIE Calculation Agent Deed of Termination and Settlement, dated 27 February 2012 LBI Full and final settlement Settlement Agreement, dated 7 June 2013 FINMA Legal standing in Switzerland On 16 January 2012, the Trustees filed a request regarding the recognition of the LBS bankruptcy decree with FINMA HBN Law LBF Claim validation proceedings (renvooiprocedure) Appeal to the Supreme Court (Hoge Raad) HBN Law filed a claim against LBS. The Trustees rejected that claim, for which reason HBN Law initiated claim validation proceedings in Curacao LBF lodged an appeal in cassation regarding a decision of the Supervisory Judge in relation to the compensation of certain costs incurred by a member of the LBS Creditors Committee The Unfunded Securities and the Repurchased Securities are still outstanding with the clearing systems and are held by LBIE (as custodian) for and on behalf of LBS. The Trustees and LBIE are currently working together to cancel the Unfunded Securities and the Repurchased Securities. Under certain programs under which LBS issued LBS Securities LBIE was the calculation agent. As per the deed of termination and settlement the appointment of LBIE as calculation agent is terminated; as a consequence of which LBS is the calculation agent. The settlement agreement provides LBS with an allowed customer claim in the LBI SIPA proceedings in the amount of USD 2,416, On 7 December 2012 the FINMA recognized the LBS bankruptcy decree. HBN Law still has to file its request with the Court in Curacao, to be expected on 19 August 2013 LBS has to lodge its statement of defense on 24 September Improper management The Trustees will report about their investigation regarding directors' and officers' liability (bestuurdersaansprakelijkheid) in the next bankruptcy report. 8. Fraudulent acts in respect of creditors The Trustees will report about their investigation regarding any fraudulent acts (paulineus handelen) in the next bankruptcy report.

8 8/8 9. Auditor The Trustees will report about their investigation regarding the manner in which the auditor of LBS, Ernst & Young Curacao, has fulfilled its duty, in the next bankruptcy report. 10. Miscellaneous This fourteenth bankruptcy report (as well as every subsequent bankruptcy report) will be available on the website. The bankruptcy reports are also available for inspection at the Court of First Instance in Curacao. 11. Plan of action / Time line (i) The Trustees will finalize the investigations regarding (a) the directors' and officers' liability (bestuurdersaansprakelijkheid); (b) any fraudulent acts (paulineus handelen); and (c) the auditor s duties; (ii) The Trustees expect to make a second cash distribution in the next reporting period; and (iii) The 15 th bankruptcy report will be published in the second half of December ****