424B2 1 a07-28123_52424b2.htm 424B2

 

 

Calculation of the Registration Fee

 

Title of Each Class of Securities
 Offered

 

Maximum Aggregate Offering
 Price

 

Amount of Registration Fee(1)(2)

 

Notes

 

$38,000,000

 

$1,166.60

 

 

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

 

(2) Pursuant to Rule 457(p) under the Securities Act of 1933, filing fees have already been paid with respect to unsold securities that were previously registered pursuant to a Registration Statement on Form S-3 (No. 333-134553) filed by Lehman Brothers Holdings Inc. and the other Registrants thereto on May 30, 2006, as amended, the Registration Statement, and have been carried forward, of which $1,166.60 is offset against the registration fee due for this offering and of which $1,540,149.30 remains available for future registration fees. No additional registration fee has been paid with respect to this offering.

 


 

Filed Pursuant to Rule 424(b)(2)

Registration No. 333-134553

 

PRICING SUPPLEMENT NO. 511 dated November 14, 2007

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 (the “Prospectus Supplement”) (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.:

 

5252M0AV9

 

 

 

 

 

 

 

 

 

 

 

ISIN:

 

US5252M0AV96

 

 

 

 

 

 

 

 

 

 

 

Specified Currency:

 

Principal:

 

U.S. Dollars

 

 

 

 

Interest:

 

U.S. Dollars

 

 

 

 

 

 

 

 

 

Principal Amount at Maturity:

$38,000,000

 

 

 

 

 

 

 

Total

 

Per Note

 

Issue Price(1):

 

$

4,463,290.00

 

11.7455

%

Agent’s Commission(2):

 

$

93,290.00

 

0.2455

%

Proceeds to Lehman Brothers Holdings Inc.:

 

$

4,370,000.00

 

11.500

%

(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.

 

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

 

 

 

 

 

 

 

x  The Notes are being offered at a fixed initial public offering price equal to the Issue Price.

 

 

 

 

 

o  The Notes are being offered at varying prices relating to prevailing market prices at the time of sale.

 

 

 

 

 

Trade Date:

 

November 14, 2007

 

 

 

 

 

 

 

Issue Date:

 

November 27, 2007

 

 

 

 

 

 

 

Stated Maturity Date:

 

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

 

 

 

 

 

 

 

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

 

 

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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.

 

Date From Which Interest Accrues:

 

x  Issue Date

 

 

 

 

o  Other: _____________

 

 

 

 

 

 

 

x

Fixed Rate Note

 

 

 

 

 

 

 

 

 

 

 

Interest Rate per Annum:

 

0.00% (The Notes do not pay interest)

 

 

 

 

 

 

 

 

Annualized Internal Rate

 

 

 

 

 

of Return:

 

7.40%

 

 

 

 

 

 

 

 

o

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

 

 

 

 

 

o  Other:

 

 

 

 

 

 

 

 

Index Maturity:

 

Not applicable

 

 

 

 

 

 

 

 

Spread:

 

Not applicable

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Spread Multiplier:

 

Not applicable

 

 

 

 

 

 

 

Maximum Rate:

 

Not applicable

 

 

 

 

 

 

 

Minimum Rate:

 

Not applicable

 

 

 

 

 

 

 

Interest Payment Dates:

 

Not applicable

 

 

 

 

 

 

 

Interest Determination Dates:

 

Not applicable

 

 

 

 

 

 

 

Interest Reset Dates:

 

Not applicable

 

 

 

 

 

 

 

Calculation Agent:

 

Lehman Brothers Special Financing

 

 

 

 

 

 

 

Underwriter:

 

Lehman Brothers Inc.

 

 

 

 

 

 

 

Optional Redemption:

 

Not applicable

 

 

 

 

 

 

 

Day count Convention:

 

30/360, unadjusted

 

 

 

 

 

 

 

Business Days:

 

London and New York

 

 

 

 

 

 

 

Minimum Denomination:

 

$1,000 and integral multiples of $1.00

 

 

 

 

 

 

 

Form of Note:

 

x  Book-entry only (global)

 

o Certificated

 

 

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 Prospectus Supplement.

 

 

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

 

Because the issue price of the Notes is less than the stated 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.

 

 

SUPPLEMENTAL INFORMATION CONCERNING THE PLAN OF DISTRIBUTION

 

Lehman Brothers Holdings Inc. 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

 

4


 

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 price equal to the Issue Price set forth above and to certain dealers at a discount not to exceed 0.2455%.  After the initial public offering, the public offering price and other selling terms may from time to time be varied by the Agent.

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.

 

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