Around $35 billion worth of hedge fund assets in Lehman Brothers' International were frozen following the bank's collapse in September 2008 and to date $13.3 billion has been returned to clients across the world.
Under the terms of the new Claim Resolution Agreement, a further $11 billion in trust assets will be released back to their rightful owners.
Hedge fund managers whose assets were caught in the bankruptcy proceedings have been contacted by PwC today (Tuesday 24th November) with the full details of the deal.
Clients will have until December 29th to vote on the package and PwC hopes that it will be able to start returning assets by the end of the first quarter of 2010.
To help achieve this, it has set a cut-off point for claims for trust assets.
It is applying to the High Court in the UK, where the Lehman Brothers' unit was based to set the end of February 2010 as a bar date for claim applications.
Stephen Pearson, joint administrator of Lehman Brothers International and a partner at PwC, urged clients to vote in favour of the proposals so that the affected hedge funds will be able to reimburse their investors.
"If this proposal fails it is likely that it could take years to ultimately return all client assets," he warned.
"I am appealing to all affected clients to give their support to these proposals."
The deal has been proposed following a ruling earlier this month by the British Court of Appeal.
It turned down a PwC plan to speed up the return of hedge fund assets via a scheme of arrangement under an act of British law, which allows a reorganization of a company's share capital by the consolidation or division of shares into different classes.
By Tony Aynsley