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3. Existence of an Arrangement To Convert the AIG
Notes to Cash at the Holder’s Request
During the hearing, the Court, citing Rule 121(d),
admonished respondent’s counsel that her objection to the motion
was not accompanied by affidavits, nor had she moved for
additional discovery regarding the existence of a prohibited
“arrangement”. Subsequently, respondent’s counsel attempted to
obtain an affidavit from Kurt Nelson (Mr. Nelson), a vice
president at AIG during 2000-2002, who was personally involved in
the transactions pursuant to which MP purchased the AIG notes and
a related company, AMWLHC Bostonian Promisee L.L.C. (BP),
purchased $19 million in promissory notes from AIG (the BP-AIG
notes). The affidavit sought by respondent’s counsel was to
state that, if requested by a client, “it would be AIG’s
practice” to (1) renegotiate the terms of its notes, “provided it
was in AIG’s own economic or client-relationship interest”, and
(2) “provide a bid to * * * [purchase its notes] provided the
purchase did not affect AIG’s own cash management needs.” Mr.
Nelson refused to sign the requested affidavit and, instead,
executed an essentially identical affidavit with the important
exception that he would represent only that AIG “would consider”
renegotiating or modifying the terms of the AIG notes or
providing a bid to repurchase the notes.
As evidence of an “arrangement” to permit the AIG notes to
be “readily convertible” into cash, respondent cites
correspondence among representatives and employees of AIG and
associates of Mr. Winn establishing that AIG was willing to
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