What is the rate of post-petition interest paid on allowed claims under the Global Settlement?
The statute under which post-petition interest is payable speaks of the “legal rate” of interest, without specifying that rate, and does not make clear whether interest is compounded on an annual or other periodic basis. Two of the Subordinated Notes provide for floating interest rates, while the other Senior and Subordinated Notes carry fixed rates ranging from 4.75% to 11.25%. The Global Settlement provided for a uniform post-petition interest rate of 5.57% per annum through May 31, 2002 for all allowed claims, based on the statutory federal judgment rate in effect at the time the Southeast bankruptcy case was filed, and for no compounding of interest.
