Lehman counterparty hold-outs warned to pay up on credit derivatives contracts

Counterparties to derivatives trades with Lehman Brothers that are currently in-the-money for the bankrupt estate will not be able to hold off payment indefinitely, predict lawyers.Since Lehman's bankruptcy on September 15, 2008, many of its derivatives counterparties have apparently sought to withhold payment under section 2(a)(iii) of the International Swaps and Derivatives Association master agreement.

The relevant section of the master agreement, known as the 'flawed asset' clause, dictates t

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