-----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, QqfNsmW9RbPWixaOBChGYT1xGwt3B+KeSFhWrwiQVNb7BKxdDPJjb7W5Gnr/45uk Hy99qX7Bh+RGnkgkw8mbNQ== 0001104659-06-040640.txt : 20060608 0001104659-06-040640.hdr.sgml : 20060608 20060608172443 ACCESSION NUMBER: 0001104659-06-040640 CONFORMED SUBMISSION TYPE: 424B3 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20060608 DATE AS OF CHANGE: 20060608 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: 424B3 SEC ACT: 1933 Act SEC FILE NUMBER: 333-134553 FILM NUMBER: 06894768 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 424B3 1 a06-13276_5424b3.htm PROSPECTUS FILED PURSUANT TO RULE 424(B)(3)

CALCULATION OF REGISTRATION FEE

 

 

 

 

 

 

 

Title of Each Class of Securities Offered

 

 

Maximum Aggregate

Offering Price

 

Amount of
Registration
Fee(1)(2)

Floating Rate Notes due 2021

 

$5,000,000

 

$535.00

 

(1)             Calculated in accordance with Rule 457(r) under the Securities Act of 1933, as amended.

(2)             Pursuant to Rule 457(p) under the Securities Act of 1933, as amended, filing fees of $1,226,195.12 have already been paid with respect unsold securities that were previously registered under the Registration Statement on Form S-3 (No. 333-121067) filed by Lehman Brothers Holdings Inc. and the other Registrants on May 18, 2005 and have been carried forward, of which $535.00 is offset against the registration fee due for this offering and $1,225,660.12 remains available for future registration fees. No additional registration fee has been paid with respect to this offering.

 

Rule 424(b)(3)

 

Registration No. 333-134553

 

PRICING SUPPLEMENT NO. 2 dated June 6, 2006
to Prospectus Supplement dated May 30, 2006
and Prospectus dated May 30, 2006

LEHMAN BROTHERS HOLDINGS INC.
Medium-Term Notes, Series I

This Pricing Supplement supplements the terms and conditions in, and incorporates by reference, the Prospectus, dated May 30, 2006, as supplemented by the Prospectus Supplement, dated May 30, 2006 (as so supplemented, together with all documents incorporated by reference therein, the “Prospectus”), and should be read in conjunction with the Prospectus. Unless otherwise defined in this Pricing Supplement, terms used herein have the same meanings as are given to them in the Prospectus.

CUSIP No.:

 

52517PJ69

 

 

 

 

 

 

 

ISIN:

 

US52517PJ694

 

 

 

 

 

 

 

Specified Currency:

 

Principal:   U.S. Dollars

 

 

 

 

Interest:      U.S. Dollars

 

 

 

 

 

 

 

Principal Amount:

 

$5,000,000

 

 

 

 

Total

 

Per Note

 

Issue Price:

 

$

5,000,000

 

100

%

Agent’s Commission:

 

$

0

 

0

%

Proceeds to Lehman Brothers Holdings:

 

$

5,000,000

 

100

%

 

1



 

On the Issue Date, we may, without the consent of the holders of the Notes, issue additional notes similar to these Notes in all respects except for the Issue Price. Following the Issue Date, we may, without the consent of the holders of Notes, create and issue additional notes similar to these Notes in all respects except for the Issue Date, Issue Price and the payment of interest accruing prior to the Issue Date of such additional notes. All such additional notes will be consolidated and form a single tranche with, have the same CUSIP and ISIN numbers as and trade interchangeably with these Notes.

Agent:

 

Lehman Brothers

 

 

 

Agent’s Capacity:

 

x As principal  o As agent

 

 

 

Trade Date:

 

June 6, 2006

 

 

 

Issue Date:

 

June 29, 2006

 

 

 

Stated Maturity Date:

 

June 29, 2021, subject to Optional Redemption; provided that if such day is not a New York and London business day, then such day will be the following New York and London business day unless such day falls in the following month in which case it will be the preceding New York and London business day.

 

 

 

Date From Which Interest Accrues:

 

x Issue Date

 

 

o Other: _____________

o Fixed Rate Note

 

 

 

 

 

   Interest Rate per Annum:

 

_______%

 

 

 

x Floating Rate Note

 

o CD Rate

 

 

o Commercial Paper Rate

 

 

o Federal Funds (Effective) Rate

 

 

o Federal Funds (Open) Rate

 

 

o LIBOR Telerate

 

 

o LIBOR Reuters

 

 

o EURIBOR

 

 

o Treasury Rate:      Constant Maturity o Yes  o No

 

 

o Prime Rate

 

 

o Eleventh District Cost of Funds Rate

 

 

o CMS Rate

 

 

x Other: See “Interest Rate per Annum” below

 

 

 

Interest Rate per Annum:

 

10% times the Index

 

 

 

Maximum Rate:

 

Not applicable

 

2



 

Minimum Rate:

 

0%

 

 

 

Interest Period:

 

Quarterly, from and including each Interest Payment Date (or the Issue Date, in the case of the first Interest Period) to but excluding the next succeeding Interest Payment Date (or the Maturity Date, in the case of the final Interest Period).

 

 

 

Interest Payment Dates:

 

Each March 29, June 29, September 29 and December 29, commencing on September 29, 2006, subject to Optional Redemption; provided that if such day is not a New York and London business day, then such day will be the following New York and London business day unless such day falls in the following month in which case it will be the preceding New York and London business day, and provided further that the final Interest Payment Date for any Notes shall be the Stated Maturity Date, subject to Optional Redemption.

 

 

 

Index:

 

The number of calendar days in each Interest Period on which the Spread is equal to or greater than 0%, divided by the total number of calendar days in each such Interest Period.

 

 

 

Spread:

 

30-Year CMS Rate minus the 2-Year CMS Rate, subject to the Rate Cut Off

 

 

 

Rate Cut Off:

 

The Spread for Saturday, Sunday or a day which is not a Business Day will be the Spread for the immediately preceding Business Day. The Spread applicable to the day five Business Days prior to an Interest Payment Date will remain in effect until the Interest Payment Date.

 

 

 

30-Year CMS Rate:

 

On any day during any Interest Period, the rate that appears on Reuters Screen ISDAFIX1 under the heading “30YR” as of 11:00 a.m., New York city time. If such rate does not appear on Reuters Screen ISDAFIX1, the rate for such date shall be determined as if the parties had specified “USD-CMS-Reference Banks” as the applicable rate, as described under “Description of the Notes—Floating Rate Notes—CMS Rate Notes” in the Prospectus.

 

 

 

2-Year CMS Rate:

 

On any day during any Interest Period, the rate that appears on Reuters Screen ISDAFIX1 under the heading “2YR” as of 11:00 a.m., New York city time. If such rate does not appear on Reuters Screen ISDAFIX1, the rate

 

3



 

 

for such date shall be determined as if the parties had specified “USD-CMS-Reference Banks” as the applicable rate, as described under “Description of the Notes—Floating Rate Notes—CMS Rate Notes” in the Prospectus

 

 

 

Interest Computation:

 

Interest will be computed on the basis of a 360-day year of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed.

 

 

 

Adjusted:

 

[ ] Yes     [X] No

 

 

 

Interest Rate Calculation Agent:

 

Lehman Brothers Special Financing

 

 

 

Optional Redemption:

 

The Notes may be redeemed prior to the Stated Maturity Date at the option of Lehman Brothers Holdings in whole or in part at a price equal to 100% of the principal amount being redeemed, on each Interest Payment Date, commencing on September 29, 2006. Notice of redemption will be given not less than five New York and London business days prior to the redemption date.

 

 

 

Form of Note:

 

[X ] Book-entry only (global)     [  ] Certificated

 

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

Treatment of Notes as Variable Rate Debt Instruments

We intend to treat the notes as variable rate debt instruments, as described under “Supplemental United States Federal Income Tax Consequences—Variable Rate Debt Instruments” in the Prospectus.

HISTORICAL LEVELS OF THE 30-YEAR CMS RATE AND THE 2-YEAR CMS RATE

The following shows for illustrative purposed the 30-Year CMS Rate and the 2-Year CMS Rate in effect on hypothetical Interest Payment Dates listed below; the Interest Rate payable on any Interest Payment Date for the Notes, however, will be determined on each day during the related Interest Period. The historical experience of the 30-Year CMS Rate and the 2-Year CMS Rate should not be taken as an indication of the future performance of the 30-Year CMS Rate and the 2-Year CMS Rate during the term of the Notes. Fluctuations in the level of the 30-Year CMS Rate and the 2-Year CMS Rate make the Notes’ effective interest rate difficult to predict and can result in effective interest rates to investors that are lower than anticipated. In addition, historical interest rates are not necessarily indicative of future interest rates. Fluctuations in interest rates and interest rate trends that have occurred in the past are not necessarily indicative of

4



 

fluctuations that may occur in the future, which may be wider or narrower than those that have occurred historically.

 

 

Hypothetical
Interest Payment Dates

 

 

30yr CMS Rate (in%)

 

2yr CMS Rate (in%)

 

SPREAD REF:
30yr CMS Rate —
2yr CMS Rate
(in%)

 

3/29/2006

 

5.429

 

5.237

 

0.192

 

12/29/2005

 

5.07

 

4.829

 

0.241

 

9/29/2005

 

4.991

 

4.514

 

0.477

 

6/29/2005

 

4.699

 

4.006

 

0.693

 

3/29/2005

 

5.355

 

4.275

 

1.08

 

12/29/2004

 

5.334

 

3.493

 

1.841

 

9/29/2004

 

5.191

 

2.962

 

2.229

 

6/29/2004

 

5.762

 

3.244

 

2.518

 

3/29/2004

 

5.121

 

1.917

 

3.204

 

12/29/2003

 

5.349

 

2.142

 

3.207

 

9/29/2003

 

5.32

 

1.885

 

3.435

 

6/30/2003

 

4.826

 

1.524

 

3.302

 

3/31/2003

 

5.13

 

1.772

 

3.358

 

12/30/2002

 

5.122

 

1.903

 

3.219

 

9/30/2002

 

5.109

 

2.098

 

3.011

 

6/28/2002

 

6.01

 

3.242

 

2.768

 

3/28/2002

 

6.401

 

4.142

 

2.259

 

12/30/2002

 

5.122

 

1.903

 

3.219

 

9/30/2002

 

5.109

 

2.098

 

3.011

 

6/29/2001

 

6.55

 

4.832

 

1.718

 

3/29/2001

 

6.322

 

4.879

 

1.443

 

12/29/2000

 

6.321

 

5.845

 

0.476

 

9/29/2000

 

6.981

 

6.702

 

0.279

 

6/29/2000

 

7.261

 

7.211

 

0.05

 

3/29/2000

 

7.351

 

7.243

 

0.108

 

12/29/1999

 

7.289

 

6.766

 

0.523

 

9/29/1999

 

7.103

 

6.292

 

0.811

 

6/29/1999

 

6.854

 

6.149

 

0.705

 

3/29/1999

 

6.301

 

5.474

 

0.827

 

12/29/1998

 

5.815

 

5.206

 

0.609

 

9/29/1998

 

5.829

 

4.948

 

0.881

 

6/29/1998

 

6.089

 

5.866

 

0.223

 

3/30/1998

 

6.37

 

5.999

 

0.371

 

12/29/1997

 

6.318

 

6.03

 

0.288

 

9/29/1997

 

6.72

 

6.145

 

0.575

 

6/30/1997

 

7.124

 

6.363

 

0.761

 

3/31/1997

 

7.433

 

6.675

 

0.758

 

12/30/1996

 

6.899

 

5.983

 

0.916

 

9/30/1996

 

7.328

 

6.284

 

1.044

 

 

5



 

6/28/1996

 

7.292

 

6.314

 

0.978

 

3/29/1996

 

7.097

 

5.965

 

1.132

 

12/29/1995

 

6.339

 

5.346

 

0.993

 

9/29/1995

 

6.905

 

6.018

 

0.887

 

6/29/1995

 

7.102

 

6.059

 

1.043

 

3/29/1995

 

7.863

 

6.954

 

0.909

 

12/29/1994

 

8.375

 

8.143

 

0.232

 

9/29/1994

 

8.4

 

6.864

 

1.536

 

6/29/1994

 

8.091

 

6.382

 

1.709

 

3/29/1994

 

7.63

 

5.432

 

2.198

 

12/29/1993

 

6.914

 

4.331

 

2.583

 

9/29/1993

 

6.636

 

3.969

 

2.667

 

6/29/1993

 

7.342

 

4.204

 

3.138

 

3/29/1993

 

7.605

 

4.182

 

3.423

 

12/29/1992

 

7.744

 

4.863

 

2.881

 

9/29/1992

 

7.703

 

4.009

 

3.694

 

 

SUPPLEMENTAL INFORMATION CONCERNING THE PLAN OF DISTRIBUTION

Lehman Brothers Holdings has agreed to sell to Lehman Brothers Inc. (the “Agent”), and the Agent has agreed to purchase from Lehman Brothers Holdings Inc. the principal amount of the Notes at the price specified on the cover of this pricing supplement. The Agent is committed to take and pay for all of the Notes, if any are taken.

The Agent proposes to offer the Notes initially at a public offering price equal to the Issue Price set forth above and to certain dealers at such price. After the initial public offering, the public offering price and other selling terms may from time to time be varied by the Agent.

It is expected that delivery of the Notes will be made against payment therefor more than three business days following the date of this pricing supplement. Trades in the secondary market generally are required to settle in three business days unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade the securities on any day prior to the third business day before the settlement date will be required to specify an alternative settlement cycle at the time of any such trade to prevent failed settlement.

If the Notes are sold in a market-making transaction after their initial sale, information about the purchase price and the date of the sale will be provided in a separate confirmation of sale.

 

6


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