Unit Buy-Back and Redemption

Information About Unit Buy-Back and Redemption

In an effort to reduce the accounting and administrative costs incurred by the Trust each year, the Trustee has started to redeem (buy-back) units from investors who hold small positions in the Trust and in the IRA Partnership pool. The Bankruptcy Court has authorized the Trustee to redeem (buy-back) units from all investors who hold 10,000 or fewer Position Holder Trust (PHT) units and/or IRA Partnership (IRAP) units in the pool. These redemptions are mandatory and are not voluntary. The redemptions will be split-up over a period of the next 2 to 3 years. Most importantly, this buy-back has no impact on other holdings, such as CFH positions or NIRAN notes.

As of September 29, 2020, the Trustee has redeemed units from all investors holding 4,000 PHT and/or IRAP units or less in the pool. The Trustee has also redeemed PHT units held by nearly all investors who are not US Citizens. If you received a check as a result of the buy-back, you will no longer receive any more distributions made to the pool based on those units. If you have an interest in a life settlement or viatical (also referred to as Continuing Fractional Holder interest or CFH position), or if you have a NIRAN (stands for New IRA Note), this redemption does not affect that ownership interest in any way. As long as you continue to pay your premiums, your CFH position will not change.

To learn all about the PHT units, IRA Partnership units, CFH positions, and NIRAN notes, please visit the What Do I Own section of the website.

 

I’m a CFH. How did I end up with these PHT units? Even if you decided to continue paying premiums and became a CFH (Continuing Fractional Holder) you received units in the pool in exchange for 5% of the face amount of your policy investments. So, everyone who did not hold their investment in an IRA account was issued PHT units in the pool. This was required under the Bankruptcy Plan and these units have been in the pool since 2017.

 

Distributions to the Pool – If you hold PHT units and/or IRA Partnership units, you likely received small general distribution checks made to the pool of 16,000+ investors in November 2019 and August 2020. The date and amount of these distribution checks can be found on your Trust Distribution Report, via the Investor Portal. Instead of receiving these small checks over the next 10 years, you received a lump sum buy out. As stated before, you will no longer receive any more distributions made to the pool based on those units. Again, this buy-back has no impact on your other holdings.

 

Please take the time to log into the Investor Portal so you will be able to see what is held in your Account, see Distribution Reports and obtain other information specific to your investments. The direct link to the Investor Portal is https://phtinvestor.northstarlife.com. When NorthStar takes over on November 1st, the same login and password will work. Initial logins and passwords were provided to you in 2017, but if you no longer have it, you can send a message to loginhelp@magnaservicing.com and request that Magna Servicing send you an email that will allow you to reset your password – if possible, include your HolderIDs with your request.