-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MCS7Sy2bqE/2k1Qf5ViaftrsdVK85MxX+pseDF0+y61730fVmZFwnJnfCN+w5CR5 z7W1/hj+YF8sfzpix2ynvw== 0001104659-06-019048.txt : 20060324 0001104659-06-019048.hdr.sgml : 20060324 20060324124235 ACCESSION NUMBER: 0001104659-06-019048 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20060322 ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060324 DATE AS OF CHANGE: 20060324 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LEHMAN BROTHERS HOLDINGS INC CENTRAL INDEX KEY: 0000806085 STANDARD INDUSTRIAL CLASSIFICATION: SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211] IRS NUMBER: 133216325 STATE OF INCORPORATION: DE FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09466 FILM NUMBER: 06708284 BUSINESS ADDRESS: STREET 1: LEHMAN BROTHERS STREET 2: 745 SEVENTH AVENUE CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2125267000 MAIL ADDRESS: STREET 1: LEHMAN BROTHERS STREET 2: 745 SEVENTH AVENUE CITY: NEW YORK STATE: NY ZIP: 10019 FORMER COMPANY: FORMER CONFORMED NAME: SHEARSON LEHMAN HUTTON HOLDINGS INC DATE OF NAME CHANGE: 19901017 8-K 1 a06-6746_38k.htm CURRENT REPORT OF MATERIAL EVENTS OR CORPORATE CHANGES

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (date of earliest event reported):

March 22, 2006

LEHMAN BROTHERS HOLDINGS INC.

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation)

1-9466		13-3216325
(Commission File Number)		(IRS Employer Identification No.)

745 Seventh Avenue New York, New York		10019
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code:

(212) 526-7000

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 9.01.	Financial Statements and Exhibits

(c)	Exhibits

The following Exhibits are incorporated by reference into Registration Statement on Form S-3 No. 333-121067 as exhibits thereto and are filed as part of this Report.

4.01 Form of senior debt security—medium-term note (Principal Protected Digital Basket FX-Linked Note)

4.02 Form of senior debt security—medium-term note (Principal Protected Trade Balance Correction Basket FX-Linked Note)

4.03 Form of senior debt security—medium-term note (Relative Value FX-Linked Note)

4.04 Form of senior debt security—medium-term note (FX Range Resetting Note)

4.05 Master Calculation Agency Agreement, dated as of March 22, 2006, between Lehman Brothers Holdings Inc. (the “Corporation”) and Lehman Brothers Inc., as Calculation Agent, relating to the Corporation’s FX-Linked Notes

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

	LEHMAN BROTHERS HOLDINGS INC.
	(Registrant)


	By:	/s/ James J. Killerlane III
		James J. Killerlane III
		Vice President


Date: March 22, 2006

EXHIBIT INDEX

Exhibit No.		Exhibit

4.01		Form of senior debt security—medium-term note (Principal Protected Digital Basket FX-Linked Note)

4.02		Form of senior debt security—medium-term note (Principal Protected Trade Balance Correction Basket FX-Linked Note)

4.03		Form of senior debt security—medium-term note (Relative Value FX-Linked Note)

4.04		Form of senior debt security—medium-term note (FX Range Resetting Note)

4.05		Master Calculation Agency Agreement, dated as of March 22, 2006, between Lehman Brothers Holdings Inc. (the “Corporation”) and Lehman Brothers Inc., as Calculation Agent, relating to the Corporation’s FX-Linked Notes

EX-4.1 2 a06-6746_3ex4d1.htm INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING INDENTURES

Exhibit 4.01

CUSIP NO. 52517PF30

REGISTERED		PRINCIPAL AMOUNT: $3,000,000
No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES H

PRINCIPAL PROTECTED DIGITAL BASKET FX-LINKED NOTE
DUE MARCH 24, 2008

THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY OR A NOMINEE OF THE DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE COMPANY (AS DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM (A “CERTIFICATED NOTE”), THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.

LEHMAN BROTHERS HOLDINGS INC., a corporation duly organized and existing under the laws of the State of Delaware (herein called the “Company,” which term includes any successor corporation under the Indenture referred to on the reverse hereof), for value received, hereby promises to pay to CEDE & Co., or registered assigns, on the Maturity Date, an amount equal to the Redemption Amount. The Notes do not bear interest. No payments on the Notes will be made until the Maturity Date.

The “Maturity Date” is March 24, 2008, or if such day is not a Business Day, on the next following Business Day.

The Redemption Amount, for each $1 principal amount of the Notes represented hereby, is the amount equal to the sum of (a) $1 plus (b) the Additional Amount.

The “Additional Amount”, for each $1 principal amount of the Notes represented hereby will be (subject to the occurrence of a Disruption Event) $1 multiplied by (i) 31.45%, if the Basket Value is greater than or equal to 0, or (ii) 0% if the Basket Value is less than 0.

The “Reference Currencies” are the Brazilian Real (BRL), Indonesian Rupiah (IDR), Turkish Lira (TRY) and U.S. Dollar (USD).

The “Basket Value” equals the sum of:

(i) a quotient, the numerator of which is 0.70183 and the denominator of which is the Settlement Rate for BRL plus

(ii) a quotient, the numerator of which is 3052.66361 and the denominator of which is the Settlement Rate for IDR plus

(iii) a quotient, the numerator of which is 0.44133 and the denominator of which is the Settlement Rate for TRY plus

(iv) a quotient, the numerator of which is -1.0000 and the denominator of which is the Settlement Rate for USD.

The “Settlement Rate” for each Reference Currency is the Reference Exchange Rate on the Valuation Date, observed as per the Settlement Rate Option (subject to the occurrence of a Price Source Unavailability Event).

The “Reference Exchange Rates” are the spot exchange rates for each of the Reference Currencies quoted against the U.S. dollar expressed as number of currency units per USD 1.

The “Settlement Rate Option” for each Reference Currency is as follows:

Reference Currency		Settlement Rate Option
BRL		The Brazilian Real/U.S. Dollar offered rate for U.S. Dollars, expressed as the amount of Brazilian Reais per one U.S. Dollar, for settlement in two Business Days reported by the Banco Central do Brasil on SISBACEN Data System under transaction code PTAX-800 (“Consulta de Cambio” or Exchange Rate Inquiry), Option 5 (“Cotacoes para Contabilidade” or Rates for Accounting Purposes), which appears on Reuters Screen BRFR Page under the caption “Dolar PTAX” at approximately 6:30 pm Sao Paolo time on the Valuation Date
IDR		The Indonesian Rupiah/U.S. Dollar spot rate at 11:00 a.m., Singapore time, expressed as the amount of Indonesian Rupiah per one U.S. Dollar, for settlement in two Business Days, reported by the Association of

		Banks in Singapore which appears on the Telerate Page 50157 to the right of the caption “Spot” under the column “IDR” at approximately 11:30 a.m., Singapore time, on the Valuation Date.
TRY		The spot rate in (A) divided by the spot rate in (B)
		(A) The Turkish Lira/Euro fixing rate, expressed as the amount of Turkish Lira per one Euro which appears on Reuters Screen ECB37 to the right of the caption “TRY” at approximately 2:15 p.m., Central European time, on that Valuation Date.

		(B) The U.S. Dollar/Euro fixing rate, expressed as the amount of U.S. Dollar per one Euro which appears on Reuters Screen ECB37 to the right of the caption “USD” at approximately 2:15 p.m., Central European time, on that Valuation Date.

The screen or time of observation indicated in relation to any Settlement Rate Option above shall be deemed to refer to such screen or time of observation as modified or amended from time to time, or to any substitute screen thereto.

The “Valuation Date” is March 17, 2008 or, if such day is not a Valuation Business Day, the immediately preceding Valuation Business day.

A “Valuation Business Day” means, with respect to (a) TRY, any day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET) System is open, and (b) BRL or IDR, any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which commercial banks are authorized or required by law, regulation or executive order to close (including for dealings in foreign exchange in accordance with the practice of the foreign exchange market) in Sao Paolo or Singapore, respectively.

A “Business Day”, notwithstanding any provision in the Indenture, is any day that is not is not a Saturday or Sunday and that is not a day on which banking institutions in New York City generally are authorized or obligated by law or executive order to be closed.

Upon the occurrence of a Disruption Event with respect to any Reference Currency on any day during the term of the notes, the Calculation Agent shall determine the Additional Amount payable on the Maturity Date in good faith and in a commercially reasonable manner.

A “Disruption Event” means any of the following events (other than a Price Source Unavailability Event), as determined in good faith by the Calculation Agent:

(A) for any Reference Currency other than EUR, the occurrence and/or existence of an event on any day that has the effect of preventing or making impossible

i) the conversion of any Reference Currency into USD through customary legal channels; or

ii) the delivery (x) of USD from accounts inside the country for which a Reference Currency is the lawful currency (such jurisdiction with respect to such Reference Currency, the “Reference Currency Jurisdiction”) to accounts outside that Reference Currency Jurisdiction or (y) of any Reference Currency between accounts inside any Reference Currency Jurisdiction or to a party that is a non-resident of such Reference Currency Jurisdiction;

(B) the occurrence of any event causing the Reference Exchange Rate for any Reference Currency to be split into dual or multiple currency exchange rates; or

(C) the occurrence and/or existence of any event (other than those set forth in (A) or (B) above or those constituting a Price Source Unavailability Event) with respect to any Reference Currency that prevents or makes impossible (x) the Calculation Agent’s ability to calculate the Additional Amount, (y) the fulfilment of our obligations under the notes, or (z) our ability or the ability of any of our affiliates through which we hedge our position under the notes to hedge such position or to unwind all or a material portion of such hedge.

Upon the occurrence of a Price Source Unavailability Event with respect to a Reference Currency, the Settlement Rate for the affected Reference Currency will be determined in accordance with the Fallback Rate Observation Methodology.

A “Price Source Unavailability Event” means, as determined in good faith by the Calculation Agent, the Settlement Rate being unavailable for a Reference Currency, or the occurrence of an event (other than an event constituting a Disruption Event) that generally makes it impossible to obtain the Settlement Rate for a Reference Currency, on the relevant Valuation Date.

The “Fallback Rate Observation Methodology” means that the Settlement Rate for a Reference Currency will be calculated on the basis of the arithmetic mean of the applicable spot quotations received by the Calculation Agent at approximately 10:00 a.m., New York City time, on the Valuation Business Day next succeeding the Valuation Date for the purchase or sale for deposits in the Reference Currency by the New York offices of three leading banks engaged in the interbank market (selected in the sole discretion of the Calculation Agent) (the “Reference Banks”). If fewer than three Reference Banks provide spot quotations then the Settlement Rate for such Reference Currency will be determined by the Calculation Agent in good faith and in a commercially reasonable manner.

Except as provided below, the Redemption Amount may, at the option of the Company, be made by check mailed to the person entitled thereto at such person’s address as it appears on the registry books of the Company.

Payment of the Redemption Amount will be made in immediately available funds upon surrender of this Note at the corporate trust office or agency of the Trustee (or any duly appointed Paying Agent) maintained for that purpose in the Borough of Manhattan, New York City (the “Corporate Trust Office”), provided that this Note is presented to the Trustee (or any such Paying Agent) in time for the Trustee (or any such Paying Agent) to make such payments in such funds in accordance with its normal procedures.

The Company will pay any administrative costs imposed by banks in making payments in immediately available funds, but any tax, assessment or governmental charge imposed upon payments hereunder, including, without limitation, any withholding tax, will be borne by the Holder hereof.

References herein to “USD”, “U.S. dollars” or “U.S.$” or “$” are to the coin or currency of the United States as at the time of payment is legal tender for the payment of public and private debts.

REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF. SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.

This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture.

IN WITNESS WHEREOF, Lehman Brothers Holdings Inc. has caused this instrument to be signed by its Chairman of the Board, its President, its Vice Chairman, its Chief Financial Officer, one of its Vice Presidents or its Treasurer, by manual or facsimile signature under its corporate seal, attested by its Secretary or one of its Assistant Secretaries by manual or facsimile signature.

Dated: March 22, 2006

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name:
		Title:


	Attest:
		Name:
		Title:

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated herein referred to in the within-mentioned Indenture.

CITIBANK, N.A.

as Trustee

By:
	Authorized Officer

[REVERSE OF NOTE]

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTES, SERIES H

PRINCIPAL PROTECTED DIGITAL BASKET FX-LINKED NOTE
DUE MARCH 24, 2008

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series H, Principal Protected Digital Basket FX-Linked Note (herein called the “Notes”). The Notes are one of an indefinite number of series of debt securities of the Company (collectively, the “Securities”) issued or issuable under and pursuant to an indenture dated as of September 1, 1987, as amended and supplemented (the “Indenture”), duly executed and delivered by the Company and Citibank, N.A., as Trustee (herein called the “Trustee”), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the holders of the Securities. The separate series of Securities may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions or repurchase rights (if any), may be subject to different sinking, purchase or analogous funds (if any), may be subject to different covenants and Events of Default and may otherwise vary as in the Indenture provided.

Section 2. Principal Amount for Indenture Purposes. For the purpose of determining whether Holders of the requisite amount of Notes of this series outstanding under the Indenture have made a demand, given a notice or waiver or taken any other action, the principal amount of this Note will be deemed to be the principal amount of this Note then outstanding.

Section 3. Modification and Waivers. The Indenture contains provisions permitting the Company and the Trustee, with the consent of the Holders of not less than 66-2/3% in aggregate principal amount of each series of the Securities at the time Outstanding to be affected, evidenced as in the Indenture provided, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the holders of the Securities of all such series; provided, however, that no such supplemental indenture shall, among other things, (i) change the fixed maturity of any Security, or reduce the Redemption Amount or the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon or reduce any premium or other amount payable on redemption, or make the Redemption Amount or the principal amount thereof, premium or other amount payable, if any, or interest thereon payable in any coin or currency other than that hereinabove provided, without the consent of the Holder of each Security so affected, or (ii) change the place of payment on any Security, or impair the right to institute suit for payment on any Security, or reduce the aforesaid percentage of Securities, the holders of which are required to consent to any such supplemental indenture, without the consent of the holders of each Security so affected. It is also provided in the Indenture that, prior to any declaration accelerating the maturity of any series of Securities, the holders of a majority in aggregate principal amount of the Securities of such series Outstanding may on behalf of the holders of all the Securities of such series waive any past

default or Event of Default under the Indenture with respect to such series and its consequences, except a default in the payment of interest, if any, on the Redemption Amount or the principal amount, or premium, if any, on any of the Securities of such series, or in the payment of any sinking fund installment or analogous obligation with respect to Securities of such series. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future holders and owners of this Note and any Notes of this series which may be issued in exchange or substitution herefor, irrespective of whether or not any notation thereof is made upon this Note or such other Notes of this series.

Section 4. Obligations Unconditional. No reference herein to the Indenture and no provisions of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the Redemption Amount or the principal amount on this Note at the place, at the respective times, at the rate, and in the coin or currency herein prescribed.

Section 5. Defeasance. The Indenture contains provisions for the discharge of the Indenture and defeasance at any time of the indebtedness on this Note upon compliance by the Company with certain conditions set forth therein, which provisions apply to this Note.

Section 6. Authorized Form and Denominations. The Notes of this series are issuable in registered form, without coupons. Each Note will be issued initially as either a Global Security or a Certificated Note, at the option of the Company, in denominations of $10,000 or whole multiples of $10,000, either at the office or agency to be designated and maintained by the Company for such purpose in the Borough of Manhattan, New York City, pursuant to the provisions of the Indenture or at any of such other offices or agencies as may be designated and maintained by the Company for such purpose pursuant to the provisions of the Indenture, and in the manner and subject to the limitations provided in the Indenture, but without the payment of any service charge, except for any tax or other governmental charges imposed in connection therewith. Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series of a different authorized denomination, except that Global Securities will not be exchangeable for Certificated Notes of this series.

Section 7. Registration of Transfer. As provided in the Indenture and subject to certain limitations as therein set forth, the transfer of this Note is registrable in the Security Register, upon surrender of this Note for registration of transfer, at the Corporate Trust Office or agency in a Place of Payment for this Note, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar requiring such written instrument of transfer duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes of this series, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

If at any time the Depository notifies the Company that it is unwilling or unable to continue as Depository or if at any time the Depository shall no longer be eligible under the Indenture, the Company shall appoint a successor Depository. If a successor Depository for the Notes of this series is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such ineligibility, the Company will issue, and the Trustee will authenticate and deliver, Notes of this series in definitive form in an aggregate principal amount equal to the principal amount of this Note.

No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith.

Prior to due presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the person in whose name this Note is registered as the owner hereof for all purposes, and neither the Company nor the Trustee nor any agent of the Company or of the Trustee shall be affected by any notice to the contrary.

Section 8. Events of Default. If an Event of Default with respect to Notes of this series shall occur and be continuing, the amount declared due and payable upon any acceleration of the Notes will be determined by the Calculation Agent and will equal the Redemption Amount calculated as though the maturity of the Notes were the date of early repayment in the manner and with the effect provided in the Indenture. The amount payable to the Holder hereof upon any acceleration permitted under the Indenture will be equal to the Redemption Amount calculated as though the date to which the maturity has been accelerated were the Maturity Date as determined by the Calculation Agent.

Section 9. No Recourse Against Certain Persons. No recourse for the payment of the Redemption Amount or for any claim based hereon or otherwise in respect hereof, and no recourse under or upon any obligation, covenant or agreement of the Company in the Indenture or any Indenture supplemental thereto or in any Note, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, past, present or future, of the Company or of any successor corporation, either directly or through the Company or any successor corporation, whether by virtue of any constitution, statute or rule of law or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released.

Section 10. Tax Treatment. The Company agrees, and by acceptance of beneficial ownership interest in the Notes of this series, each Holder of such Notes will be deemed to have agreed, for United States federal income tax purposes, (i) to treat the Notes of this series as indebtedness that is subject to Treas. Reg. Sec. 1.1275-4 (the “Contingent Payment Regulations”) and (ii) to be bound by the Company’s determination of the “comparable yield” and “projected payment schedule,” within the meaning of the Contingent Payment Regulations, with respect to the Notes of this series.

Section 11. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 12. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

EX-4.2 3 a06-6746_3ex4d2.htm INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING INDENTURES

Exhibit 4.02

CUSIP NO. 52517PF22

REGISTERED		PRINCIPAL AMOUNT: $10,000,000
No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES H

PRINCIPAL PROTECTED TRADE BALANCE CORRECTION BASKET FX-LINKED NOTE DUE MARCH 24, 2008

The “Maturity Date” is March 24, 2008, or if such day is not a Business Day, on the next following Business Day.

The Redemption Amount, for each $1 principal amount of the Notes represented hereby, is the amount equal to the sum of (a) $1 plus (b) the Additional Amount.

The “Additional Amount”, for each $1 principal amount of the Notes represented hereby will be (subject to the occurrence of a Disruption Event) the greater of (i) zero and (ii) 140% times the Basket Value.

The “Reference Currencies” are the Canadian Dollar (CAD), Chinese Yuan (CNY), Euro (EUR), Japanese Yen (JPY), Mexican Peso (MXN), Singapore Dollar (SGD) and U.S. Dollar (USD).

The “Basket Value” equals the sum of:

(i) a quotient, the numerator of which is 0.23051 and the denominator of which is the Settlement Rate for CAD plus

(ii) a quotient, the numerator of which is 1.60780 and the denominator of which is the Settlement Rate for CNY plus

(iii) a quotient, the numerator of which is 0.12341 and the denominator of which is the Settlement Rate for EUR plus

(iv) a quotient, the numerator of which is 23.42100 and the denominator of which is the Settlement Rate for JPY plus

(v) a quotient, the numerator of which is 1.59372 and the denominator of which is the Settlement Rate for MXN plus

(vi) a quotient, the numerator of which is 0.16182 and the denominator of which is the Settlement Rate for SGD plus

(vii) a quotient, the numerator of which is -1.0000 and the denominator of which is the Settlement Rate for USD.

The “Reference Exchange Rates” are the spot exchange rates for each of the Reference Currencies quoted against the U.S. dollar expressed as number of currency units per USD 1.

The “Settlement Rate Option” for each Reference Currency is as follows:

Reference Currency		Settlement Rate Option
CAD		The Canadian Dollar/U.S. Dollar official fixing rate, expressed as the amount of Canadian Dollars per one U.S. Dollar, for settlement in one Business Day reported by the Federal Reserve Bank of New York which appears on Reuters Screen 1FED to the right of the caption “CAD” at approximately 10.00 a.m. New York time, on the Valuation Date.
CNY		The Chinese Yuan/U.S. Dollar official fixing rate, expressed as the amount of Chinese Yuan per one U.S. Dollar, for settlement in two Business Days reported by the Federal Reserve Bank of New York which appears on Reuters Screen 1FEE to the right of the caption “CNY” at approximately 12.00 p.m. New York time, on that Valuation Date.
EUR		The U.S. Dollar/Euro official fixing rate, expressed as the amount of U.S. Dollars per one Euro, for settlement in two Business Days reported by the Federal Reserve Bank of New York which appears on Reuters Screen 1FED to the right of the caption “EUR” at approximately 10.00 a.m. New York time, on the Valuation Date.
JPY		The Japanese Yen/U.S. Dollar official fixing rate, expressed as the amount of Japanese Yen per one U.S. Dollar, for settlement in two Business Days reported by the Federal Reserve Bank of New York which appears on Reuters Screen 1FED to the right of the caption “JPY” at approximately 10.00 a.m. New York time, on the Valuation Date.
MXN		The Mexican Peso/U.S. Dollar official fixing rate, expressed as the amount of Mexican Pesos per one U.S. Dollar, for settlement in two Business Days reported by the Federal Reserve Bank of New York which appears on Reuters Screen 1FEE to the right of the caption “MXN” at approximately 12.00 p.m. New York time, on that Valuation Date.
SGD		The Singapore Dollar/U.S. Dollar official fixing rate, expressed as the amount of Singapore Dollar per one U.S. Dollar, for settlement in two Business Days reported by the Federal Reserve Bank of New York which appears on Reuters Screen 1FEE to the right of the caption “SGD” at approximately 12.00 p.m. New York time, on that Valuation Date.

The “Valuation Date” is March 18, 2008 or, if such day is not a Valuation Business Day, the immediately preceding Valuation Business day.

A “Valuation Business Day” means, with respect to each Reference Currency, any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which commercial banks are authorized or required by law, regulation or executive order to close (including for dealings in foreign exchange in accordance with the practice of the foreign exchange market) in the city or jurisdiction indicated in the Settlement Rate Option for that Reference Currency.

A “Disruption Event” means any of the following events (other than a Price Source Unavailability Event), as determined in good faith by the Calculation Agent:

(A) for any Reference Currency other than EUR, the occurrence and/or existence of an event on any day that has the effect of preventing or making impossible the delivery of USD from accounts inside the country for which a Reference Currency is the lawful currency (such jurisdiction with respect to such Reference Currency, the “Reference Currency Jurisdiction”) to accounts outside that Reference Currency Jurisdiction;

(B) the occurrence of any event causing the Reference Exchange Rate for any Reference Currency to be split into dual or multiple currency exchange rates; or

(C) the occurrence and/or existence of any event (other than those set forth in (A) or (B) above or those constituting a Price Source Unavailability Event) with respect to any Reference Currency that prevents or makes impossible (x) the Calculation Agent’s ability to calculate the Additional Amount, (y) the fulfilment of our obligations under the notes, or (z) our ability or the ability of any of our affiliates through which we hedge our position under the notes to hedge such position or to unwind all or a material portion of such hedge.

The Company will pay any administrative costs imposed by banks in making payments in immediately available funds, but any tax, assessment or governmental charge

imposed upon payments hereunder, including, without limitation, any withholding tax, will be borne by the Holder hereof.

REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF. SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.

This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture.

Dated: March 22, 2006

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name:
		Title:


	Attest:
		Name:
		Title:

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated herein referred to in the within-mentioned Indenture.

CITIBANK, N.A.

as Trustee

By:
	Authorized Officer

[REVERSE OF NOTE]

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTES, SERIES H

PRINCIPAL PROTECTED TRADE BALANCE CORRECTION BASKET FX-LINKED
NOTE
DUE MARCH 24, 2008

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series H, Principal Protected Trade Balance Correction Basket FX-Linked Note (herein called the “Notes”). The Notes are one of an indefinite number of series of debt securities of the Company (collectively, the “Securities”) issued or issuable under and pursuant to an indenture dated as of September 1, 1987, as amended and supplemented (the “Indenture”), duly executed and delivered by the Company and Citibank, N.A., as Trustee (herein called the “Trustee”), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the holders of the Securities. The separate series of Securities may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions or repurchase rights (if any), may be subject to different sinking, purchase or analogous funds (if any), may be subject to different covenants and Events of Default and may otherwise vary as in the Indenture provided.

Outstanding may on behalf of the holders of all the Securities of such series waive any past default or Event of Default under the Indenture with respect to such series and its consequences, except a default in the payment of interest, if any, on the Redemption Amount or the principal amount, or premium, if any, on any of the Securities of such series, or in the payment of any sinking fund installment or analogous obligation with respect to Securities of such series. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future holders and owners of this Note and any Notes of this series which may be issued in exchange or substitution herefor, irrespective of whether or not any notation thereof is made upon this Note or such other Notes of this series.

authenticate and deliver, Notes of this series in definitive form in an aggregate principal amount equal to the principal amount of this Note.

Section 11. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 12. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

EX-4.3 4 a06-6746_3ex4d3.htm INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING INDENTURES

Exhibit 4.03

CUSIP NO. 52517PF48

REGISTERED		PRINCIPAL AMOUNT: $4,250,000
No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES H

RELATIVE VALUE FX-LINKED NOTE
DUE MARCH 22, 2007

The “Maturity Date” is March 22, 2007, or if such day is not a Business Day, on the next following Business Day.

The Redemption Amount, for each $1 principal amount of the Notes represented hereby, is the amount equal to the product of (i) the sum of one plus the Interest Rate times (ii) the Additional Amount; provided that the minimum Redemption Amount payable shall be zero.

The “Interest Rate” is 13.30%.

The “Additional Amount”, for each $1 principal amount of the Notes represented hereby will be (subject to the occurrence of a Disruption Event) the sum of one plus the Basket Value.

The “Reference Currencies” are the Turkish Lira (TRY) and Euro (EUR).

The “Basket Value” equals the sum of:

(i) a quotient, the numerator of which is 1.32200 and the denominator of which is the Settlement Rate for TRY plus

(ii) a quotient, the numerator of which is -0.82440 and the denominator of which is the Settlement Rate for EUR.

The “Reference Exchange Rates” are the spot exchange rates for each of the Reference Currencies quoted against the U.S. dollar expressed as number of currency units per USD 1.

The “Settlement Rate Option” for each Reference Currency is as follows:

Reference Currency		Settlement Rate Option
TRY		The spot rate in (A) divided by the spot rate in (B)

		(A) The Turkish Lira/Euro fixing rate, expressed as the amount of Turkish Lira per one Euro which appears on Reuters Screen ECB37 to the right of the caption “TRY” at approximately 2:15 p.m., Central European time, on that Valuation Date.

		(B) The U.S. Dollar/Euro fixing rate, expressed as the amount of U.S. Dollar per one Euro which appears on Reuters Screen ECB37 to the right of the caption “USD” at approximately 2:15 p.m., Central European time, on that Valuation Date.

EUR		One divided by the spot rate in (A):

		(A) The U.S. Dollar/Euro fixing rate, expressed as the amount of U.S. Dollar per one Euro which appears on

Reuters Screen ECB37 to the right of the caption “USD” at approximately 2:15 p.m., Central European time, on that Valuation Date.

The “Valuation Date” is March 16, 2007 or, if such day is not a Valuation Business Day, the immediately preceding Valuation Business day.

A “Valuation Business Day” means, with respect each Reference Currency, any day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET) System is open.

A “Disruption Event” means any of the following events (other than a Price Source Unavailability Event), as determined in good faith by the Calculation Agent:

(A) for any Reference Currency other than EUR, the occurrence and/or existence of an event on any day that has the effect of preventing or making impossible

i) the conversion of any Reference Currency into USD through customary legal channels; or

ii) for TRY only, the delivery of (x) USD from accounts inside Turkey to accounts outside Turkey or (y) of TRY between accounts inside Turkey or to a party that is a non-resident of Turkey;

(B) the occurrence of any event causing the Reference Exchange Rate for any Reference Currency to be split into dual or multiple currency exchange rates; or

A “Price Source Unavailability Event” means, as determined in good faith by the Calculation Agent, the Settlement Rate being unavailable for a Reference Currency, or the

occurrence of an event (other than an event constituting a Disruption Event) that generally makes it impossible to obtain the Settlement Rate for a Reference Currency, on the relevant Valuation Date.

REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF. SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.

This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture.

Dated: March 22, 2006

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name:
		Title:


	Attest:
		Name:
		Title:

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated herein referred to in the within-mentioned Indenture.

CITIBANK, N.A.

as Trustee

By:
	Authorized Officer

[REVERSE OF NOTE]

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTES, SERIES H

RELATIVE VALUE FX-LINKED NOTE
DUE MARCH 22, 2007

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series H, Relative Value FX-Linked Note (herein called the “Notes”). The Notes are one of an indefinite number of series of debt securities of the Company (collectively, the “Securities”) issued or issuable under and pursuant to an indenture dated as of September 1, 1987, as amended and supplemented (the “Indenture”), duly executed and delivered by the Company and Citibank, N.A., as Trustee (herein called the “Trustee”), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the holders of the Securities. The separate series of Securities may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions or repurchase rights (if any), may be subject to different sinking, purchase or analogous funds (if any), may be subject to different covenants and Events of Default and may otherwise vary as in the Indenture provided.

Section 10. Tax Treatment. The Company agrees, and by acceptance of beneficial ownership interest in the Notes of this series, each Holder of such Notes will be deemed to have agreed, for United States federal income tax purposes, to treat the Notes of this series as cash-settled financial contracts (rather than as debt instruments) subject to the foreign currency rules of section 988 of the Internal Revenue Code of 1986, as amended.

Section 11. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 12. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

EX-4.4 5 a06-6746_3ex4d4.htm INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING INDENTURES

Exhibit 4.04

CUSIP NO. 52517PF55

REGISTERED		PRINCIPAL AMOUNT: $5,000,000
No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES H

FX RANGE RESETTING NOTE
DUE MARCH 23, 2007

LEHMAN BROTHERS HOLDINGS INC., a corporation duly organized and existing under the laws of the State of Delaware (herein called the “Company,” which term includes any successor corporation under the Indenture referred to on the reverse hereof), for value received, hereby promises to pay to CEDE & Co., or registered assigns, on the applicable Interest Payment Date, an amount equal to the Interest Amount and, on the Maturity Date, 100% of the principal amount of the Notes.

The “Maturity Date” is March 23, 2007, or if such day is not a Business Day, on the next following Business Day.

The “Interest Payment Dates” are June 23, 2006, September 25, 2006, December 27, 2006 and March 23, 2007.

The “Interest Amount” is a single U.S. Dollar payment calculated by the calculation agent on each corresponding Interest Payment Date equal to the principal amount of the Notes multiplied by (subject to the occurrence of a Disruption Event):

(A) 2.5%, if the Reference Exchange Rate has traded strictly within the applicable Reference Range (or on either of the applicable Range Boundaries) on every day from and including the applicable Start Date at 10:00 p.m. EST, to but excluding the applicable End Date at 10:00 p.m. EST, of the applicable Reference Range period, as observed on the continuous trading EBS (Electronic Broking Service) Spot Dealing System; or

(B) 0%, if the Reference Exchange Rate trades outside the applicable Reference Range on any day from and including the applicable Start Date at 10:00 p.m. EST, to but excluding the applicable End Date at 10:00 p.m. EST, as observed on the continuous trading EBS Spot Dealing System.

Each “Reference Range”, which corresponds to a particular Reference Range period, is as follows:

Range Period	Start Date	End Date	Range Midpoint (RM_i)	Range Lower Boundary	Range Upper Boundary

1	March 17, 2006	June 19, 2006	1.2200	1.2700	1.1700

2	June 19, 2006	September 19, 2006	RM₂	RM₂-0.05	RM₂+ 0.05

3	September 19, 2006	December 19, 2006	RM₃	RM₃-0.05	RM₃+ 0.05

4	December 19, 2006	March 19, 2007	RM₄	RM₄-0.05	RM₄+ 0.05

If any Start Date or End Date is not a Valuation Business Day, such Start Date or End Date shall be the next succeeding Valuation Business Day.

The “Range Midpoint” is the Reference Exchange Rate observed on the Valuation Date observed in accordance with the Settlement Rate Option (subject to the occurrence of a Price Source Unavailability Event).

The “Valuation Date” for each Reference Range period, is the Start Date for such period.

A “Valuation Business Day” means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which commercial banks are authorized or required by law, regulation or executive order to close (including for dealings in foreign exchange in accordance with the practice of the foreign exchange market) in the city indicated in the Settlement Rate Option.

The “Reference Exchange Rate” is the spot exchange rate for the Reference Currency quoted against the U.S. Dollar expressed as the number of U.S. Dollars per unit of the Reference Currency.

The “Reference Currency” is the Euro (EUR).

The “Settlement Rate Option” is the U.S. Dollar/Euro official fixing rate, expressed as the amount of U.S. Dollars per one Euro, for settlement in two Business Days reported by the Federal Reserve Bank of New York which appears on Reuters Screen 1FED to the right of the caption “EUR” at approximately 10.00 a.m., New York time, on the relevant Valuation Date.

Upon the occurrence of a Disruption Event with respect to the Reference Currency on any day during the term of the Notes, the calculation agent shall determine the Interest Amount payable on each Interest Payment Date following the date on which the Disruption Event occurred in good faith and in a commercially reasonable manner.

A “Disruption Event” means any of the following events (other than a Price Source Unavailability Event), as determined in good faith by the calculation agent:

(A) the occurrence and/or existence of an event on any day that has the effect of preventing or making impossible the conversion of the Reference Currency into USD through customary legal channels;

(B) the occurrence of any event causing the Reference Exchange Rate to be split into dual or multiple currency exchange rates; or

(C) the occurrence and/or existence of any event (other than those set forth in (A) or (B) above or those constituting a Price Source Unavailability Event) with respect to the Reference Currency that prevents or makes impossible (x) the calculation agent’s ability to calculate the Interest Amount, (y) the Company’s fulfillment of its obligations under the Notes, or (z) the ability of the Company or any of its affiliates through which it hedges its position under the Notes to hedge such position or to unwind all or a material portion of such hedge.

Upon the occurrence of a Price Source Unavailability Event on any day in any Reference Range period or on the Valuation Date, as applicable, and in respect of any Price Source Unavailability Event other than with respect to the determination of any Range Midpoint, for so long as such Price Source Unavailability Event is continuing, the Reference Exchange Rate will be determined in accordance with the Fallback Rate Observation Methodology.

A “Price Source Unavailability Event” means, as determined in good faith by the calculation agent, the Reference Exchange Rate being unavailable, or the occurrence of an event (other than an event constituting a Disruption Event) that generally makes it impossible to obtain the Reference Exchange Rate, (a) for purposes of determining any related Range Midpoint, on the relevant Valuation Date, in accordance with the Settlement Rate Option, or (b) on any day in any Reference Range period other than for purposes of determining any Range Midpoint, on the EBS (Electronic Broking Service) Spot Dealing System.

The “Fallback Rate Observation Methodology” means that, in respect of a Price Source Unavailability Event occurring on any day in any Reference Range period (other than for purposes of determining any Range Midpoint on the relevant Valuation Date), the Reference Exchange Rate will be determined on a daily basis in accordance with the Settlement Rate Option on that day. If the Reference Exchange Rate is not available in accordance with the Settlement Rate Option on such day, or on the Valuation Date for the purposes of determining any Range Midpoint, the Reference Exchange Rate will be calculated on the basis of the arithmetic mean of the applicable spot quotations received by the calculation agent at approximately 10:00 a.m., New York City time, on the Valuation Business Day next succeeding that day for the purchase or sale for deposits in the Reference Currency by the Reference Banks. If fewer than three Reference Banks provide spot quotations, then the Reference Exchange Rate will be calculated on the basis of the arithmetic mean of the applicable spot quotations received by the calculation agent at approximately 10:00 a.m., New York City time, on the relevant date from two Reference Banks (selected in the sole discretion of the calculation agent), for the purchase or sale for deposits in the Reference Currency. If these spot quotations are available from only one Reference Bank, then the calculation agent, in its sole discretion, will determine which quotation is available and reasonable to be used. If no spot quotation is available, then the Reference Exchange Rate will be determined by the calculation agent in good faith and in a commercially reasonable manner.

The “Reference Banks” means the New York offices of three leading banks engaged in the interbank market selected in the sole discretion of the Calculation Agent.

Except as provided below, an Interest Amount may, at the option of the Company, be made by check mailed to the person entitled thereto at such person’s address as it appears on the registry books of the Company.

Payment of the Interest Amount will be made in immediately available funds in accordance with the normal procedures of the Trustee (or any duly appointed Paying Agent).

References herein to “U.S. dollars” or “U.S.$” or “$” or “USD” are to the coin or currency of the United States as at the time of payment is legal tender for the payment of public and private debts.

REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF. SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.

This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture.

Dated: March 23, 2006

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name:
		Title:


	Attest:
		Name:
		Title:

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated herein referred to in the within-mentioned Indenture.

CITIBANK, N.A.

as Trustee

By:
	Authorized Officer

[REVERSE OF NOTE]

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTES, SERIES H

FX RANGE RESETTING NOTE
DUE MARCH 23, 2007

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series H, FX Range Resetting Note (herein called the “Notes”). The Notes are one of an indefinite number of series of debt securities of the Company (collectively, the “Securities”) issued or issuable under and pursuant to an indenture dated as of September 1, 1987, as amended and supplemented (the “Indenture”), duly executed and delivered by the Company and Citibank, N.A., as Trustee (herein called the “Trustee”), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the holders of the Securities. The separate series of Securities may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions or repurchase rights (if any), may be subject to different sinking, purchase or analogous funds (if any), may be subject to different covenants and Events of Default and may otherwise vary as in the Indenture provided.

Section 3. Modification and Waivers. The Indenture contains provisions permitting the Company and the Trustee, with the consent of the Holders of not less than 66-2/3% in aggregate principal amount of each series of the Securities at the time Outstanding to be affected, evidenced as in the Indenture provided, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the holders of the Securities of all such series; provided, however, that no such supplemental indenture shall, among other things, (i) change the fixed maturity of any Security, or reduce the Interest Amount or the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon or reduce any premium or other amount payable on redemption, or make the Interest Amount or the principal amount thereof, premium or other amount payable, if any, or interest thereon payable in any coin or currency other than that herein above provided, without the consent of the Holder of each Security so affected, or (ii) change the place of payment on any Security, or impair the right to institute suit for payment on any Security, or reduce the aforesaid percentage of Securities, the holders of which are required to consent to any such supplemental indenture, without the consent of the holders of each Security so affected. It is also provided in the Indenture that, prior to any declaration accelerating the maturity of any series of Securities, the holders of a majority in aggregate principal amount of the Securities of such series

Outstanding may on behalf of the holders of all the Securities of such series waive any past default or Event of Default under the Indenture with respect to such series and its consequences, except a default in the payment of interest, if any, on the Interest Amount or the principal amount, or premium, if any, on any of the Securities of such series, or in the payment of any sinking fund installment or analogous obligation with respect to Securities of such series. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future holders and owners of this Note and any Notes of this series which may be issued in exchange or substitution herefor, irrespective of whether or not any notation thereof is made upon this Note or such other Notes of this series.

Section 4. Obligations Unconditional. No reference herein to the Indenture and no provisions of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the Interest Amount or the principal amount on this Note at the place, at the respective times, at the rate, and in the coin or currency herein prescribed.

Section 6. Authorized Form and Denominations. The Notes of this series are issuable in registered form, without coupons. Each Note will be issued initially as either a Global Security or a Certificated Note, at the option of the Company, in denominations of $10,000 or whole multiples of $5,000, either at the office or agency to be designated and maintained by the Company for such purpose in the Borough of Manhattan, New York City, pursuant to the provisions of the Indenture or at any of such other offices or agencies as may be designated and maintained by the Company for such purpose pursuant to the provisions of the Indenture, and in the manner and subject to the limitations provided in the Indenture, but without the payment of any service charge, except for any tax or other governmental charges imposed in connection therewith. Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series of a different authorized denomination, except that Global Securities will not be exchangeable for Certificated Notes of this series.

authenticate and deliver, Notes of this series in definitive form in an aggregate principal amount equal to the principal amount of this Note.

Section 8. Events of Default. If an Event of Default with respect to Notes of this series shall occur and be continuing, the amount that may be declared due and payable upon any acceleration of the Notes will be determined by the calculation agent and will equal, for each Note, the principal amount plus the Interest Amount, if any, payable in respect of the Reference Range period during which the event of default occurred, which Interest Amount shall equal the portion of the Interest Amount deemed to have accrued for such Reference Range period from and including the Start Date for such Reference Range period to but excluding the date of early repayment calculated on the basis of a 360-day year consisting of 12 months of 30 days each, and, in the case of an incomplete month, the number of days elapsed. If a bankruptcy proceeding is commenced in respect of the Company, the claim of the beneficial owner of a Note will be capped at the principal amount plus the Interest Amount, if any, payable in respect of the Reference Range period during which the date of the commencement of the proceeding occurred, which Interest Amount shall equal the portion of the Interest Amount deemed to have accrued for such Reference Range period from and including the Start Date for such Reference Range period to but excluding the date of early repayment calculated on the basis of a 360-day year consisting of 12 months of 30 days each, and, in the case of an incomplete month, the number of days elapsed. For purposes of determining whether any Interest Amount is payable in respect of any Reference Range period during which an event of default occurred or a bankruptcy proceeding was commenced, the End Date for such Reference Range period shall be deemed to be the date on which such event of default occurred or such proceeding commenced, respectively.

Section 9. No Recourse Against Certain Persons. No recourse for the payment of the Interest Amount or for any claim based hereon or otherwise in respect hereof, and no recourse under or upon any obligation, covenant or agreement of the Company in the Indenture or any Indenture supplemental thereto or in any Note, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, past, present or future, of the Company or of any successor corporation, either directly or through the Company or any successor corporation, whether by virtue of any constitution, statute or rule of law or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released.

Section 10. Tax Treatment. The Company agrees, and by acceptance of Notes of this series, each Holder of such Notes will be deemed to have agreed to treat the Notes of this series as “variable rate debt instruments” for United States federal income tax purposes.

Section 11. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 12. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

EX-4.5 6 a06-6746_3ex4d5.htm INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING INDENTURES

Exhibit 4.05

CALCULATION AGENCY AGREEMENT

BETWEEN

LEHMAN BROTHERS HOLDINGS INC.

AND

LEHMAN BROTHERS INC.

CALCULATION AGENCY AGREEMENT, dated as of March 22, 2006 (this “Agreement”), between Lehman Brothers Holdings Inc. (the “Company”) and Lehman Brothers Inc., as Calculation Agent.

WHEREAS, the Company proposes to issue and sell its FX-Linked Notes (the “Notes”) from time to time;

WHEREAS, the terms of the Notes will be set forth in the applicable Note (in connection with the performance by the Calculation Agent of its services hereunder with respect to the Notes, the Note is referred to herein as the “relevant Note”);

WHEREAS, the terms of the Notes will be described in a pricing supplement (in connection with the performance by the Calculation Agent of its services hereunder with respect to the Notes, the pricing supplement relating to the Notes is referred to herein as the “relevant Pricing Supplement”) to the prospectus supplement dated May 18, 2005 and the prospectus dated May 18, 2005;

WHEREAS, the Notes will be issued under an Indenture, dated as of September 1, 1987, between the Company and Citibank, N.A., as Trustee (the “Trustee”), as supplemented and amended by supplemental indentures dated as of November 25, 1987, November 27, 1990, September 13, 1991, October 4, 1993, October 1, 1995, and June 26, 1997, and incorporating Standard Multiple Series Indenture Provisions dated July 30, 1987, as amended November 16, 1987 (collectively, the “Indenture”); and

WHEREAS, the Company requests the Calculation Agent to perform certain services described herein in connection with the Notes;

NOW THEREFORE, the Company and the Calculation Agent agree as follows:

1. Appointment of Agent. The Company hereby appoints Lehman Brothers Inc. as Calculation Agent and Lehman Brothers Inc. hereby accepts such appointment as the Company’s agent for the purpose of performing the services hereinafter described upon the terms and subject to the conditions hereinafter mentioned.

2. Calculations and Information Provided. In response to a request made by the Trustee for a determination of the Redemption Amount, Additional Amount, Interest Amount or other amount as specified in the relevant Note, with respect to any series of the Notes, the Calculation Agent shall determine the Redemption Amount, Additional Amount, Interest

Amount or other amount specified in the relevant Note or the relevant Pricing Supplement on the Valuation Date, Settlement Date or other relevant date(s) or series of days specified in the relevant Note or the relevant Pricing Supplement, or as soon as practicable thereafter but in no event later than the relevant payment date for such amount, in accordance with the terms of the Notes and this Agreement, and shall notify the Trustee of its determination. In addition, the Calculation Agent shall also be responsible for each of the following items for the Notes, to the extent applicable:

(a) determining whether a Disruption Event has occurred and, in the event a Disruption Event has occurred, determining the Redemption Amount, Additional Amount, Interest Amount or other amount specified in the relevant Note or the relevant Pricing Supplement in the manner specified therein;

(b) determining whether a Price Source Unavailability Event has occurred and, in the event a Price Source Unavailability Event has occurred, taking the actions specified in the relevant Note or the relevant Pricing Supplement; and

(c) making any other calculation, determination or adjustment specified as being made by the Calculation Agent in this Agreement, the relevant Pricing Supplement or the relevant Note.

The Calculation Agent shall notify the Trustee of all such determinations and adjustments or if a Disruption Event or a Price Source Unavailability Event with respect to a series of Notes has occurred.

3. Calculations. Any calculation or determination by the Calculation Agent pursuant hereto shall be made at the sole discretion of the Calculation Agent and shall (in the absence of manifest error) be final and binding. Any calculation made by the Calculation Agent hereunder shall, at the Trustee’s request, be made available at the Corporate Trust Office. The procedures the Calculation Agent will use to determine the information described herein with respect to the Notes is set forth as follows:

On the Valuation Date, Settlement Date or other relevant date(s) or series of dates specified in the relevant Note or the relevant Pricing Supplement, or as soon as practicable thereafter but in no event later than the relevant payment date, the Calculation Agent shall:

(a) calculate the Redemption Amount, Additional Amount, Interest Amount or other amount for the Notes as specified and described in the relevant Note or the relevant Pricing Supplement; and/or

(b) determine with respect to the applicable Reference Currency or Reference Currencies the Reference Exchange Rate(s), Settlement Rate(s) or other rate(s) specified in the relevant Note or the relevant Pricing Supplement (including any forward rates or values, forward points, futures values, or rate(s) based on or interpolated from any of the foregoing or from any other determinant specified in the specified in the the relevant Note or the relevant Pricing Supplement).

The Calculation Agent shall notify the Trustee of all such calculations and determinations, and any adjustments thereof.

4. Fees and Expenses. The Calculation Agent shall be entitled to reasonable compensation for all services rendered by it as agreed to between the Calculation Agent and the Company.

5. Terms and Conditions. The Calculation Agent accepts its obligations herein set out upon the terms and conditions hereof, including the following, to all of which the Company agrees:

(a) in acting under this Agreement, the Calculation Agent is acting solely as an independent expert and not as an agent of the Company and does not assume any obligation toward, or any relationship of agency or trust for or with, any of the holders of the Notes;

(b) unless otherwise specifically provided herein, any order, certificate, notice, request, direction or other communication from the Company or the Trustee made or given under any provision of this Agreement shall be sufficient if signed by any person who the Calculation Agent reasonably believes to be a duly authorized officer or attorney-in-fact of the Company or the Trustee, as the case may be;

(c) the Calculation Agent shall be obliged to perform only such duties as are set out specifically herein and any duties necessarily incidental thereto;

(d) the Calculation Agent, whether acting for itself or in any other capacity, may become the owner or pledgee of Notes with the same rights as it would have had if it were not acting hereunder as Calculation Agent; and

(e) the Calculation Agent shall incur no liability hereunder except for loss sustained by reason of its gross negligence or willful misconduct.

6. Resignation; Removal; Successor. (a) The Calculation Agent may at any time resign by giving written notice to the Company of such intention on its part, specifying the date on which its desired resignation shall become effective, subject to the appointment of a successor Calculation Agent and acceptance of such appointment by such successor Calculation Agent, as hereinafter provided. The Calculation Agent hereunder may be removed at any time by the filing with it of an instrument in writing signed by or on behalf of the Company and specifying such removal and the date when it shall become effective. Such resignation or removal shall take effect upon the appointment by the Company, as hereinafter provided, of a successor Calculation Agent and the acceptance of such appointment by such successor Calculation Agent. In the event a successor Calculation Agent has not been appointed and has not accepted its duties within 90 days of the Calculation Agent’s notice of resignation, the Calculation Agent may apply to any court of competent jurisdiction for the designation of a successor Calculation Agent.

(b) In case at any time the Calculation Agent shall resign, or shall be removed, or shall become incapable of acting, or shall be adjudged bankrupt or insolvent, or

make an assignment for the benefit of its creditors or consent to the appointment of a receiver or custodian of all or any substantial part of its property, or shall admit in writing its inability to pay or meet its debts as they mature, or if a receiver or custodian of it or all or any substantial part of its property shall be appointed, or if any public officer shall have taken charge or control of the Calculation Agent or of its property or affairs, for the purpose of rehabilitation, conservation or liquidation, a successor Calculation Agent shall be appointed by the Company by an instrument in writing, filed with the successor Calculation Agent. Upon the appointment as aforesaid of a successor Calculation Agent and acceptance by the latter of such appointment, the Calculation Agent so superseded shall cease to be Calculation Agent hereunder.

(c) Any successor Calculation Agent appointed hereunder shall execute, acknowledge and deliver to its predecessor, to the Company and to the Trustee an instrument accepting such appointment hereunder and agreeing to be bound by the terms hereof, and thereupon such successor Calculation Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of such predecessor with like effect as if originally named as Calculation Agent hereunder, and such predecessor, upon payment of its charges and disbursements then unpaid, shall thereupon become obligated to transfer, deliver and pay over, and such successor Calculation Agent shall be entitled to receive, all moneys, securities and other property on deposit with or held by such predecessor, as Calculation Agent hereunder.

(d) Any corporation into which the Calculation Agent hereunder may be merged or converted or any corporation with which the Calculation Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Calculation Agent shall be a party, or any corporation to which the Calculation Agent shall sell or otherwise transfer all or substantially all of the assets and business of the Calculation Agent shall be the successor Calculation Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto.

7. Certain Definitions. Capitalized terms not otherwise defined herein are used herein as defined in the relevant Note or the relevant Pricing Supplement or, if not defined in the relevant Note or the relevant Pricing Supplement, as defined in the Indenture.

8. Indemnification. The Company will indemnify the Calculation Agent against any losses or liability which it may incur or sustain in connection with its appointment or the exercise of its powers and duties hereunder except such as may result from the gross negligence or wilful misconduct of the Calculation Agent or any of its agents or employees. The Calculation Agent shall incur no liability and shall be indemnified and held harmless by the Company for or in respect of any action taken or suffered to be taken in good faith by the Calculation Agent in reliance upon written instructions from the Company.

9. Notices. Any notice required to be given hereunder shall be delivered in person, sent (unless otherwise specified in this Agreement) by letter, telex or facsimile transmission or communicated by telephone (confirmed in a writing dispatched within two Business Days), (a) in the case of the Company, to it at 745 Seventh Avenue, New York, New York 10019 (facsimile: (646) 758-3204) (telephone: (212) 526-7000), Attention: Treasurer, with a copy to 1301 Avenue of the Americas, 5th floor, New York, NY 10019 (facsimile: (212) 526-0357)

(telephone: (212) 526-7000), Attention: Corporate Secretary, (b) in the case of the Calculation Agent, to it at Lehman Brothers Inc., 745 Seventh Avenue, New York, NY 10019 (facsimile: (646) 758-3204) (telephone: (212) 526-7000), Attention: Treasurer and (c) in the case of the Trustee, to it at 111 Wall Street, 5th Floor, New York, New York 10043 (facsimile: (212) 657-3836) (telephone: (212) 657-7805), Attention: Corporate Trust Department or, in any case, to any other address or number of which the party receiving notice shall have notified the party giving such notice in writing. Any notice hereunder given by telex, facsimile or letter shall be deemed to be served when in the ordinary course of transmission or post, as the case may be, it would be received.

10. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONTINUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

11. Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

12. Benefit of Agreement. This Agreement is solely for the benefit of the parties hereto and their successors and assigns, and no other person shall acquire or have any rights under or by virtue hereof.

IN WITNESS WHEREOF, this Agreement has been entered into as of the day and year first above written.

	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name:
		Title:


	LEHMAN BROTHERS INC.
	as Calculation Agent


	By:
		Name:
		Title:

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