FWP 1 a07-28123_39fwp.htm FWP

Filed Pursuant to Rule 433

Registration No: 333-134553

 

30YNC4Y Annually Callable Zero Note

Final Terms and Conditions

Lehman Brothers Holdings Inc. has filed a registration statement (including a prospectus) with the U.S. Securities and Exchange Commission (SEC) for this offering. Before you invest, you should read the prospectus dated May 30, 2006, the prospectus supplement dated May 30, 2006 for its Medium Term Notes, Series I, and other documents Lehman Brothers Holdings Inc. has filed with the SEC for more complete information about Lehman Brothers Holdings Inc. and this offering.  Buyers should rely upon the prospectus, prospectus supplement and any relevant free writing prospectus for complete details.  You may get these documents and other documents Lehman Brothers Holdings Inc. has filed for free by searching the SEC online database (EDGAR®) at www.sec.gov with “Lehman Brothers Holdings Inc.” as a search term. You may also access the prospectus and Series I MTN prospectus supplement on the SEC web site as follows:

Series I MTN prospectus supplement dated May 30, 2006:

http://www.sec.gov/Archives/edgar/data/806085/000104746906007785/a2170815z424b2.htm

Prospectus dated May 30, 2006:

http://www.sec.gov/Archives/edgar/data/806085/000104746906007771/a2165526zs-3asr.htm

Alternatively, Lehman Brothers Inc. will arrange to send you the prospectus, Series I MTN prospectus supplement and final pricing supplement (when completed) if you request it by calling your Lehman Brothers sales representative or 1-888-603-5847.

 

 

 

Issuer

 

Lehman Brothers Holdings Inc.

Ratings

 

Moody’s A1/ S&P A+/ Fitch AA–

CUSIP

 

5252M0AV9

Principal Amount at Maturity

 

USD 38,000,000

Trade Date

 

November 14, 2007

Issue Date

 

November 27, 2007

Maturity Date

 

November 27, 2037 (Subject to Issuer’s Call Option)

Issue Price

 

11.7455% of the Principal Amount at Maturity

Redemption Price at Maturity

 

100.00% of the Principal Amount at Maturity

Annualized Internal
Rate of Return

 

7.40%

Coupon

 

0.00% (The notes do not pay interest)

Basis

 

30/360, unadjusted

Issuer’s Call Option:

 

The Issuer has the right on November 27 in each year from and including November 27, 2011 (each a “Call Date”), provided that the Issuer gives 5 Business Days notice to the note holders, to call the notes in whole at a Redemption Price, and for an aggregate principal amount, determined in accordance with the Redemption Schedule given below.

 

 

Redemption Schedule

 

 

Call Dates

 

Redemption Price

 

Aggregate Principal
Amount

 

 

11/27/2011

 

15.6275%

 

$

5,938,439

 

 

11/27/2012

 

16.7839%

 

$

6,377,883

 

 

11/27/2013

 

18.0259%

 

$

6,849,847

 

 

11/27/2014

 

19.3598%

 

$

7,356,735

 

 

11/27/2015

 

20.7925%

 

$

7,901,134

 

 

11/27/2016

 

22.3311%

 

$

8,485,818

 


 

 

 

 

11/27/2017

 

23.9836%

 

$

9,113,768

 

 

11/27/2018

 

25.7584%

 

$

9,788,187

 

 

11/27/2019

 

27.6645%

 

$

10,512,513

 

 

11/27/2020

 

29.7117%

 

$

11,290,439

 

 

11/27/2021

 

31.9103%

 

$

12,125,931

 

 

11/27/2022

 

34.2717%

 

$

13,023,250

 

 

11/27/2023

 

36.8078%

 

$

13,986,970

 

 

11/27/2024

 

39.5316%

 

$

15,022,006

 

 

11/27/2025

 

42.4569%

 

$

16,133,635

 

 

11/27/2026

 

45.5987%

 

$

17,327,524

 

 

11/27/2027

 

48.9731%

 

$

18,609,760

 

 

11/27/2028

 

52.5971%

 

$

19,986,883

 

 

11/27/2029

 

56.4892%

 

$

21,465,912

 

 

11/27/2030

 

60.6694%

 

$

23,054,390

 

 

11/27/2031

 

65.1590%

 

$

24,760,414

 

 

11/27/2032

 

69.9808%

 

$

26,592,685

 

 

11/27/2033

 

75.1593%

 

$

28,560,544

 

 

11/27/2034

 

80.7211%

 

$

30,674,024

 

 

11/27/2035

 

86.6945%

 

$

32,943,902

 

 

11/27/2036

 

93.1099%

 

$

35,381,750

 

 

11/27/2037

 

100.0000%

 

$

38,000,000

 

 

The principal amount paid per note on any Call Date will be determined pro rata based on the Redemption Price corresponding to such Call Date in the table above, rounded to the nearest dollar.

Business Days

 

London &  New York

Business Day Convention

 

Modified Following

Underwriter

 

Lehman Brothers Inc.

Calculation Agent

 

Lehman Brothers Special Financing

Denominations

 

$1,000 and integral multiples of $1.00

Issue Type

 

US MTN

Fees

 

 

 

Price to Public (1)

 

Fees(2)

 

Proceeds to the Issuer

 

 

 

 

 

 

 

 

 

 

 

Per note

 

$117.455

 

$2.455

 

$115.00

 

 

Total

 

$4,463,290

 

$93,290

 

$4,370,000

 

 

(1)

The price to public includes Lehman Brothers Holdings Inc.’s cost of hedging its obligations under the notes through one or more of its affiliates, which includes such affiliates expected cost of providing such hedge as well as the profit the such affiliates expect to realize in consideration for assuming the risks inherent in providing such hedge.

 

 

(2)

Lehman Brothers Inc. will receive commissions equal to $2.455 per $1,000 principal amount, or 0.2455%, and may use all or a portion of these commissions to pay selling concessions or fees to other dealers. Lehman Brothers Inc. and/or an affiliate may earn additional income as a result of payments pursuant to any hedges.

 

 

Risk Factors:

An investment in the notes entails certain risks not associated with an investment in conventional floating rate or fixed rate medium-term notes.  See “Risk Factors” in the Series I MTN prospectus supplement.

United States Federal Income Tax Treatment:

Because the issue price of the notes is less than the Redemption Price at Maturity by more than a statutorily defined “de minimis” amount, the notes will be treated as issued with original issue discount (“OID”).  For a discussion of the tax consequences of owning securities issued with OID, see “United States Federal Income Tax Consequences—Debt Securities—Original Issue Discount” in the Prospectus dated May 30, 2006.