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Lehman's Prudential note-backed certificates to be redeemed in part
By Marisa Wong
Madison, Wis., Jan. 31 - There will be a conditional partial redemption of Lehman ABS Corp.'s corporate-backed trust certificates, Prudential Financial note-backed series 2003-20, on Feb. 3, according to a notice from trustee U.S. Bank Trust NA.
Specifically, certain call warrant holders have exercised their rights to purchase 925,865 of the 2,018,365 of outstanding class A-1 corporate backed trust certificates due July 15, 2033 and $1,006,375 of the $2,193,875 total outstanding principal amount of class A-2 corporate backed trust certificates.
The holders want to exercise their warrants in exchange for $24,153,000 of the $52,653,000 total principal amount of the 5.75% medium-term notes, series B, due July 15, 2033 issued by Prudential Financial, Inc., which are the underlying securities of the trust certificates.
According to the notice, the exercise of the call warrants is conditioned upon receipt by the trustee of the call price on the redemption date.
If the trustee receives the call price by 10 a.m. ET on Feb. 3, then 925,865 class A-1 certificates and $1,006,375 principal amount of class A-2 certificates will be selected for redemption. Each class A-1 certificate will be redeemed at $25.00 plus accrued interest, and each $1,000 class A-2 certificate will be redeemed at $185.895871203.
The total redemption amount for the class A-1 certificates will be $23,216,064.88, including $23,146,625.00 of principal and $69,439.88 of accrued interest. The total payment on the class A-2 certificates will be $187,080.96, consisting entirely of principal.
If the trustee does not receive the call price, then the certificates issued by the trust will continue to accrue interest as if no exercise notice had been given and the call warrant holders may elect to deliver a conditional notice of exercise in the future.
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