there is something on the lower head lug that looks to me like a crack. I have to say that I find it disturbing that the lugs flexed so much when it didn't seem to do anything to the tubes. Generally, a bike will bend just behind the head tube lugs. The fact that all of the deformation seems to have been located at the lugs would lead me to infer that the mitering of the tubes was pretty bad. Since the paint is ruined there anyway, you could polish that area and see if there are any cracks. I'm guessing there are, and it's a total loss.