Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

On June 1, 2012, the United States District Court for the Southern District of New York approved a $162 million settlement agreement between the SIPA Trustee and Saul B. Katz, et al. The agreement represents a final settlement between the two parties and allows the BLMIS Customer Fund to recoup six years of fictitious profits. Under terms of the settlement, the Defendants’ allowed claims of approximately $178 million (BLMIS accounts in which the Defendants had deposited more money than they had withdrawn – their “net loser” accounts) will be unconditionally assigned to the SIPA Trustee until the $162 million settlement number is reached. Distributions made to the allowed claims assigned to the SIPA Trustee will reduce the amount owed by the Defendants and will be added to the Customer Fund. On September 28, 2012, the first and second pro rata interim distribution payments of approximately $67.3 million were made with respect to the allowed claims assigned to the SIPA Trustee and added to the Customer Fund. On April 15, 2013, the Trustee’s third distribution resulted in approximately $8.336 million being returned to the Customer Fund. The remaining balance of the settlement payment is approximately $86 million.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

On December 4, 2012, the United States District Court for the Southern District of New York approved a settlement agreement between the Securities Investor Protection Act (SIPA) Trustee and individuals, feeder funds and entities related to, among others, the Beacon Associates Management Corporation, Andover Associates Management Corporation and Ivy Asset Management. Under the terms of the settlement, the defendants made a $24 million payment to the Bernard L. Madoff Investment Securities LLC (BLMIS) Customer Fund, which represents a return of 100 percent of the defendants’ withdrawals from BLMIS during the six-year period prior to the commencement of the liquidation of BLMIS, plus additional recoveries for direct withdrawals and subsequent transfers made to various defendants. In addition, the defendants, who acted as feeder fund managers, advisors and/or consultants in one or more BLMIS feeder funds, will forego all fees otherwise due to them that would be paid out of distributions by the BLMIS estate.

On May 9, 2011, a settlement agreement was announced with the Joint Liquidators of Fairfield Sentry Limited, Fairfield Sigma Limited and Fairfield Lambda Limited (collectively, the “Fairfield Funds”). Terms of the settlement include an immediate and permanent reduction – of $730 million – in the total amount of claims against the BLMIS Customer Fund by the Fairfield Funds, which would effectively increase future payments to customers with allowed claims. In addition, the settlement agreement aligned the interests of the SIPA Trustee and his counsel with the Joint Liquidators of Fairfield Sentry, strengthening both parties’ abilities to pursue and recover additional claims against the owners and management of the Fairfield Funds, as well as hundreds of subsequent transferees of customer property. The Joint Liquidators also agreed to make a $70 million payment to the SIPA Trustee with an initial payment of $24 million which has been paid by an $8 million offset of funds owed to the Fairfield Joint Liquidators and a $16 million cash payment by the Liquidators to the BLMIS Customer Fund. The remaining $46 million was paid to the SIPA Trustee on November 28, 2012. The United States Bankruptcy Court for the Southern District of New York approved this settlement agreement on June 7, 2011.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

On May 15, 2012, the United States Bankruptcy Court for the Southern District of New York approved a settlement agreement between the SIPA Trustee and Trotanoy Investment Company, Ltd. (Trotanoy), a Bailiwick of Guernsey limited liability company. The settlement with Trotanoy resulted in a $28.96 million cash settlement payment to the Customer Fund, representing a return of 100 percent of Trotanoy’s withdrawals during the 90-day preference period.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

On December 21, 2011, a $326 million settlement with the United States of America, on behalf of the Internal Revenue Service, was approved by the United States Bankruptcy Court for the Southern District of New York. The SIPA Trustee determined that BLMIS falsely debited the accounts of 145 foreign account holders for alleged U.S. federal income tax withholding and paid to the IRS such withheld amounts related to alleged dividends. However, because no securities were purchased and thus no dividends were actually ever received by BLMIS, no amounts should have been withheld and transferred to the IRS. After receipt of the settlement payment, the specific accounts were credited for the amounts transferred from 2002 – 2008 and, where appropriate, a catch up pro rata interim distribution of 4.602 percent for the credited amount has been made.

On October 4, 2011, the United States Bankruptcy Court for the Southern District of New York approved a settlement with Mount Capital Fund, a BLMIS feeder fund in liquidation in the British Virgin Islands, which returned $43.5 million to the Fund of Customer Property.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

On July 28, 2011, the SIPA Trustee announced a settlement with Tremont Group Holdings Inc. and related entities under the terms of which the defendants will deliver cash payments into escrow totaling $1.025 billion, which will ultimately be placed into the Customer Fund and distributed, pro rata, to BLMIS customers with allowed claims. On September 22, 2011, the agreement was approved by the United States Bankruptcy Court for the Southern District of New York, but was appealed by third-party appellants. On June 27, 2012, the Honorable Judge Daniels of the United States District Court for the Southern District of New York granted the SIPA Trustee’s motion to dismiss the appeal. On July 26, 2012, a notice of appeal of the District Court decision was filed by the third-party appellants. The appeal was dismissed by the United States Court of Appeals for the Second Circuit on October 25, 2012. Under the settlement agreement, the $1.025 billion recovered for the BLMIS Customer Fund and the Tremont Group and related entities funds’ first and second pro rata interim distribution payments and SIPC advances were held in escrow for 90 days from the closing date of November 6, 2012. On February 8, 2013, the $1.025 billion was released to the SIPA Trustee for the Customer Fund. The four Tremont Fund claims that were previously “deemed determined” were allowed and the SIPC advances, first and second pro rata interim distributions were paid to the Tremont entities.

On May 9, 2011, a settlement agreement was announced with the Joint Liquidators of Fairfield Sentry Limited, Fairfield Sigma Limited and Fairfield Lambda Limited (collectively, the “Fairfield Funds”). Terms of the settlement include an immediate and permanent reduction – of $730 million – in the total amount of claims against the BLMIS Customer Fund by the Fairfield Funds, which would effectively increase future payments to customers with allowed claims. In addition, the settlement agreement aligned the interests of the SIPA Trustee and his counsel with the Joint Liquidators of Fairfield Sentry, strengthening both parties’ abilities to pursue and recover additional claims against the owners and management of the Fairfield Funds, as well as hundreds of subsequent transferees of customer property. The Joint Liquidators also agreed to make a $70 million payment to the SIPA Trustee with an initial payment of $24 million which has been paid by an $8 million offset of funds owed to the Fairfield Joint Liquidators and a $16 million cash payment by the Liquidators to the BLMIS Customer Fund. The United States Bankruptcy Court for the Southern District of New York approved this settlement agreement on June 7, 2011.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

On March 10, 2011, the United States Bankruptcy Court for the Southern District of New York approved a settlement between the SIPA Trustee and Hadassah in the amount of $45 million. On or about March 28, 2011, Hadassah transferred $45 million to the SIPA Trustee.

On January 13, 2011, the United States Bankruptcy Court for the Southern District of New York approved the SIPA Trustee’s $5 billion settlement with the estate of Jeffry Picower. This decision was appealed to the United States District Court for the Southern District of New York, which affirmed the decision of the Bankruptcy Court on March 26, 2012. Notices of appeal on the District Court’s order to the United States Court of Appeals for the Second Circuit were filed on April 24, 2012.

On July 16, 2012, the deadline for further appeals of the approximately $7.2 billion Picower forfeiture to the United States Government expired, making the forfeiture order final. Under the settlement agreement, the $5 billion settlement payment was then released to the SIPA Trustee.

On January 6, 2011, the United States Bankruptcy Court for the Southern District of New York approved a pre-litigation settlement between the SIPA Trustee and Union Bancaire Privée (UBP) that resulted in the recovery of $470 million. On or about January 24, 2011, UBP transferred $470 million to the SIPA Trustee.

On December 21, 2010, the United States Bankruptcy Court for the Southern District of New York approved a pre-litigation settlement between the SIPA Trustee and Carl Shapiro, Robert Jaffe, and related entities (the “Shapiros”) in the amount of $550 million. On or about December 23, 2010, the Shapiros transferred $550 million to the SIPA Trustee. As part of the agreement, the Shapiros also forfeit $75 million to the U.S. government.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

On February 18, 2010, the United States Bankruptcy Court for the Southern District of New York approved a pre-litigation settlement between the SIPA Trustee and the estate of Norman F. Levy. This settlement resulted in the return of $220 million (the “Norman Levy Settlement”). Certain customers moved to set aside the Court’s order approving the Norman Levy settlement. The Bankruptcy Court denied the motion, and the claimants filed an appeal in United States District Court on April 11, 2011. On February 16, 2012, the District Court upheld the Bankruptcy Court’s earlier ruling approving the SIPA Trustee's settlement with the Levy family. The District Court’s ruling was appealed to the United States Court of Appeals for the Second Circuit, which affirmed the judgment of the District Court. However, the time period to challenge the Circuit Court’s ruling in the Supreme Court of the United States has not expired and, as a result, the $220 million must remain in reserve and cannot be distributed to BLMIS customers until the settlement reaches a final, unappealable conclusion.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.

On June 16, 2009, the United States Bankruptcy Court for the Southern District of New York approved a pre-litigation settlement between the SIPA Trustee and Optimal Strategic U.S. Equity Ltd. and Optimal Arbitrage Ltd. This settlement resulted in the return of over $235 million.

Litigation recoveries and other recoveries may include, but are not limited to: Recovery agreements of less than $20 million which are not subject to public disclosure; transfers from debtor’s estate (securities, bank account, interest and dividends, closeout proceeds); sale of debtor’s assets (sports tickets, bank debt participation, market making business); administrative subtenant rent revenue; refunds (BLM Air Charter, deposits, dues/subscriptions, vendors, insurance/workers comp, political contributions); recoveries (donation settlements, vendor preferences, employees, taxing authorities, class actions, NASDAQ, NYSE, transaction fees); earnings on SIPA Trustee's investments; interest on SIPA Trustee's savings accounts.