-----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, O/t2CrsELU64NMTFeR2U8cxNQx5cnpnUFs8kjZTuyreJBiVzVgg1RUj78zSwV6WS mqQmuKIE21V+26IrbNFscQ== 0001104659-08-011489.txt : 20080219 0001104659-08-011489.hdr.sgml : 20080218 20080219160733 ACCESSION NUMBER: 0001104659-08-011489 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 20080214 ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20080219 DATE AS OF CHANGE: 20080219 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: 08626664 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 a08-4165_1158k.htm 8-K

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):

February 14, 2008

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

(d) Exhibits

The following Exhibits are incorporated by reference into Registration Statement on Form S-3 No. 333-134553 as exhibits thereto and are filed as part of this Report.

4.01 Form of senior debt security— medium-term note (Notes Linked to a Latin American Currency Basket)

4.02 Form of senior debt security—medium-term note (Notes Linked to an India and China Currency Basket)

4.03 Form of senior debt security—medium-term note (Notes Linked to a Currency Basket)

4.04 Form of senior debt security—medium-term note (Notes Linked to a Basket of Commodities)

4.05 Form of senior debt security—medium-term note (Principal Protected Notes Linked to MarQCuS Portfolio A (USD) Index)

4.06 Form of senior debt security—medium-term note (Return Enhanced Notes Linked to MarQCuS Portfolio A (USD) Index)

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: February 19, 2008

EXHIBIT INDEX

Exhibit No.		Exhibit

4.01		Form of senior debt security—medium-term note (Notes Linked to a Latin American Currency Basket)

4.02		Form of senior debt security—medium-term note (Notes Linked to an India and China Currency Basket)

4.03		Form of senior debt security— medium-term note (Notes Linked to a Currency Basket)

4.04		Form of senior debt security—medium-term note (Notes Linked to a Basket of Commodities)

4.05		Form of senior debt security—medium-term note (Principal Protected Notes Linked to MarQCuS Portfolio A (USD) Index)

4.06		Form of senior debt security—medium-term note (Return Enhanced Notes Linked to MarQCuS Portfolio A (USD) Index)

EX-4.01 2 a08-4165_115ex4d01.htm EX-4.01

Exhibit 4.01

CUSIP NO. 5252M0BT3

ISIN NO. US5252M0BT32

REGISTERED		PRINCIPAL AMOUNT: $418,000
No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

NOTES LINKED TO A LATIN AMERICAN CURRENCY BASKET
DUE FEBRUARY 12, 2010

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 “Maturity Date” is February 12, 2010, or if such day is not a Business Day, on the next following Business Day.

The “Valuation Date” is February 8, 2010; provided that, upon the occurrence of a Disruption Event with respect to a Basket Currency, the Valuation Date for the affected Basket Currency may be postponed (as described in “Disruption Events” below).

The “Redemption Amount” is the amount equal to the sum of the principal amount of the Notes of $1,000, plus the Additional Amount, if any.

The “Additional Amount” is an amount per Note equal to the greater of (a) zero and (b) $1,000 multiplied by the product of the Basket Return times the Participation Rate.

The “Participation Rate” is 270%.

The “Basket” is the Brazilian Real (BRL), the Argentine Peso (ARS), the Mexican Peso (MXN) and the Chilean Peso (CLP), each a “Basket Currency” and collectively the “Basket Currencies”.

The “Basket Return” is a quotient, the numerator of which is the difference of the Basket Ending Level minus the Basket Starting Level and the denominator of which is the Basket Starting Level.

The “Basket Starting Level” is set equal to 100 on the Trade Date.

The “Basket Ending Level” is the Basket closing level on the Valuation Date, equal to the product of 100 times the sum of 1 plus the sum of the Weighted Currency Returns.

The “Weighted Currency Return” for each Basket Currency is the product of the Currency Return for such Basket Currency times the Basket Currency Weighting for such Basket Currency.

The “Currency Return” for each Basket Currency is a quotient, the numerator of which is the difference of the Initial Spot Rate for such Basket Currency minus the Final Spot Rate for such Basket Currency and the denominator of which is the Final Spot Rate for such Basket Currency.

The “Final Spot Rate” for each Basket Currency is the Reference Exchange Rate for that Basket Currency on the Valuation Date, determined by the Calculation Agent in accordance with the Spot Rate Source (subject to the occurrence of a Disruption Event).

The “Weighting” and “Initial Spot Rate” for each Basket Currency are as follows:

Basket Currency	Weighting		Initial Spot Rate
BRL	25	%	1.7681
ARS	25	%	3.16800
MXN	25	%	10.8227
CLP	25	%	473.97

The “Reference Exchange Rates” are, for each Basket Currency, the spot exchange rates for that Basket Currency quoted against the U.S. dollar, expressed as the number of units of the Basket Currency per one USD.

The “Issue Date” is February 14, 2008.

If a Disruption Event relating to one or more of the Basket Currencies is in effect on the scheduled Valuation Date, the Calculation Agent will calculate the Basket Return using:

· for each Basket Currency that did not suffer a Disruption Event on the scheduled Valuation Date, the Final Spot Rate on the scheduled Valuation Date, and

· for each Basket Currency that did suffer a Disruption Event on the scheduled Valuation Date, the Final Spot Rate on the immediately succeeding scheduled Valuation Business Day for such Basket Currency on which no Disruption Event occurs or is continuing with respect to such Basket Currency;

provided, however, that if a Disruption Event has occurred or is continuing with respect to a Basket Currency on each of the three scheduled Valuation Business Days following the scheduled Valuation Date, then (a) such third scheduled Valuation Business Day shall be deemed the Valuation Date for the affected Basket Currency; and (b) the Calculation Agent will determine the Final Spot Rate for the affected Basket Currency on such day in accordance with Fallback Rate Observation Methodology.

For purposes of the above, “scheduled Valuation Business Day” means a day that is or, in the judgment of the Calculation Agent, should have been, a Valuation Business Day for the affected Basket Currency.

A “Disruption Event” means any of the following events with respect to a Basket Currency, 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 (x) the delivery of USD from accounts inside the Basket Currency Jurisdiction for that Basket Currency to accounts outside that Basket Currency Jurisdiction, or (y) for MXN only, the conversion of the Basket Currency into USD through customary legal channels;

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

(C) the Final Spot Rate being unavailable for the Basket Currency, or the occurrence of an event (i) in the Basket Currency Jurisdiction for that Basket Currency that materially disrupts the market for the Basket Currency or (ii) that generally makes it impossible to obtain the Final Spot Rate for the Basket Currency, on the Valuation Date.

A “Valuation Business Day” means, with respect to each Basket 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 table below:

Basket Currency	Screen Reference	Valuation Business Day
BRL	BRFR	Brazilia, Rio de Janiero or São Paulo; and New York
ARS	ARS=	Buenos Aires and New York
MXN	USDMXNFIX	Mexico City and New York
CLP	CLPOB	Santiago and New York

The “Spot Rate Source” for the BRL is the Brazilian Real/U.S. Dollar offered rate for U.S. Dollars, expressed as the amount of Brazilian Reals 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 Trade Date or Valuation Date, as applicable. The Spot Rate Source for the ARS is the Argentine Peso/U.S. dollar official fixing rate, expressed as the amount of Argentine Pesos per one U.S. dollar for settlement on the same day (or, if that day is not a business day in Buenos Aires and New York, for settlement on the first succeeding day that is a business day in both Buenos Aires and New York) which appears on the Reuters Screen ARS= page at the close of business in Buenos Aires on that Valuation Date. The Spot Source Rate for the MXN is 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 Banco de Mexico which appears on Reuters Screen MEX01 Page under the heading “USDMXNFIX=“ at the close of business in Mexico City on the Start Date or such other relevant date. The Spot Source Rate for the CLP is the Chilean Peso/U.S. Dollar observado rate, expressed as the amount of Chilean Pesos per one U.S. Dollar, for settlement on the same day reported by the Banco Central de Chile which appears on the Reuters Screen CLPOB=Page below the caption “Value” at approximately 10:00 a.m., Santiago time, on the first Business Day following the relevant Valuation Date. The term “business day” solely as used in any Spot Rate Source described above shall mean 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 Principal Financial Center for both (a) the Basket Currency and (b) the currency against which the Basket Currency is quoted (the “base currency”) in accordance with the Reference Exchange

Rate specified in the applicable pricing supplement, in each case as specified for the applicable Basket Currency or base currency in the table above.

The screen or time of observation indicated in relation to any Final Spot Rate 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 “Fallback Rate Observation Methodology” means that the Reference Exchange Rate, Final Spot Rate or other rate, as specified in the applicable pricing supplement, in respect of a basket currency will equal the noon buying rate in New York for cable transfers in foreign currencies as announced by the Federal Reserve Bank of New York for customs purposes (the “Noon Buying Rate”) on the relevant Valuation Date or such other date specified in the applicable pricing supplement. If the Noon Buying Rate is not announced on that date, the Reference Exchange Rate, Final Spot Rate or other rate for such Basket 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 or such other date specified in the applicable pricing supplement, for the purchase or sale for deposits in the basket 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 Reference Exchange Rate, Final Spot Rate or other rate, as applicable, 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 Basket Currency. If these spot quotations are available from only one Reference Bank, then the Calculation Agent, in its sole discretion, will determine whether that quotation is reasonable to be used. If no spot quotation is available, then the Reference Exchange Rate, Final Spot Rate or other rate, as applicable, for such Basket Currency will be determined by the Calculation Agent in good faith and in a commercially reasonable manner.

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.

The “Calculation Agent” means Lehman Brothers Inc.

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 in accordance with the normal procedures of the Trustee (or any duly appointed Paying Agent).

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 “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.

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: February 14, 2008

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name: Andrew Yeung
		Title: Vice President


	Attest:
		Name: Cindy Buckholz
		Title: Assistant Secretary

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 I

NOTES LINKED TO A LATIN AMERICAN CURRENCY BASKET
DUE FEBRUARY 12, 2010

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series I, Notes Linked to a Latin American Currency Basket (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 Additional 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 Additional 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 Additional 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 Additional 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 $1,000 or whole multiples of $1,000, 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 that may be declared due and payable upon any acceleration of the notes will be determined by the Calculation Agent for the period from and including the Issue Date to but excluding the date of early repayment and will equal, for each note, the Redemption Amount, calculated as the date of early repayment were the Maturity Date. If a bankruptcy proceeding is commenced in respect of Lehman Brothers Holdings, the claim of the beneficial owner of a note for the period from and including the Issue Date to but excluding the date of early repayment will be capped at the Redemption Amount, calculated as though the date of the commencement of the proceeding were the Maturity Date.

Section 9. No Recourse Against Certain Persons. No recourse for the payment of the Additional 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. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 11. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

EX-4.02 3 a08-4165_115ex4d02.htm EX-4.02

Exhibit 4.02

CUSIP NO. 5252M0BU0

ISIN NO. US5252M0BU05

REGISTERED		PRINCIPAL AMOUNT: $585,000
No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

NOTES LINKED TO AN INDIA AND CHINA CURRENCY BASKET
DUE FEBRUARY 14, 2012

The “Maturity Date” is February 14, 2012, or if such day is not a Business Day, on the next following Business Day.

The “Valuation Date” is February 8, 2012; provided that, upon the occurrence of a Disruption Event with respect to a Basket Currency, the Valuation Date for the affected Basket Currency may be postponed (as described in “Disruption Events” below).

The “Redemption Amount” is the amount equal to the sum of the principal amount of the Notes of $1,000, plus the Additional Amount, if any.

The “Additional Amount” is an amount per Note equal to the greater of (a) zero and (b) $1,000 multiplied by the product of the Basket Return times the Participation Rate.

The “Participation Rate” is 135%.

The “Basket” is the Indian Rupee (INR) and the Chinese Renminbi (CNY), each a “Basket Currency” and collectively the “Basket Currencies”.

The “Basket Return” is a quotient, the numerator of which is the difference of the Basket Ending Level minus the Basket Starting Level and the denominator of which is the Basket Starting Level.

The “Basket Starting Level” is set equal to 100 on the Trade Date.

The “Basket Ending Level” is the Basket closing level on the Valuation Date, equal to the product of 100 times the sum of 1 plus the sum of the Weighted Currency Returns.

The “Weighted Currency Return” for each Basket Currency is the product of the Currency Return for such Basket Currency times the Basket Currency Weighting for such Basket Currency.

The “Weighting” and “Initial Spot Rate” for each Basket Currency are as follows:

Basket Currency	Weighting		Initial Spot Rate
INR	50	%	39.55
CNY	50	%	7.1846

The “Issue Date” is February 14, 2008.

If a Disruption Event relating to one or more of the Basket Currencies is in effect on the scheduled Valuation Date, the Calculation Agent will calculate the Basket Return using:

· for each Basket Currency that did not suffer a Disruption Event on the scheduled Valuation Date, the Final Spot Rate on the scheduled Valuation Date, and

A “Disruption Event” means any of the following events with respect to a Basket Currency, 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 (x) the delivery of USD from accounts inside the Basket Currency Jurisdiction for that Basket Currency to accounts outside that Basket Currency Jurisdiction, or (y) the conversion of the Basket Currency into USD through customary legal channels;

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

Basket Currency	Screen Reference	Valuation Business Day
INR	RBIB	Mumbai
CNY	SAEC	Beijing

The “Spot Rate Source” for the INR is the Indian Rupee/U.S. Dollar reference rate, expressed as the amount of Indian Rupee per one U.S. Dollar, for settlement in two Business Days reported by the Reserve Bank of India which appears on the Reuters Screen RBIB Page at approximately 2:30 p.m., Mumbai time, or as soon thereafter as practicable on the Trade Date or Valuation Date, as applicable. The Spot Rate Source for the CNY is the Chinese Renminbi/U.S. Dollar official Beijing fixing rate, expressed as the amount of Chinese Renminbi per one U.S. Dollar, for settlement in two Business Days reported by The State Administration of Foreign Exchange of the People’s Republic of China, Beijing, which appears on the Reuters Screen SAEC Page opposite the symbol “USDCNY=“ at approximately 5:00 p.m., Beijing time, on the relevant Valuation Date. The term “business day” solely as used in any Spot Rate Source described above shall mean 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 Principal Financial Center for both (a) the Basket Currency and (b) the currency against which the Basket Currency is quoted (the “base currency”) in accordance with the Reference Exchange Rate specified in the applicable pricing supplement, in each case as specified for the applicable Basket Currency or base currency in the table above.

supplement, for the purchase or sale for deposits in the basket 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 Reference Exchange Rate, Final Spot Rate or other rate, as applicable, 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 Basket Currency. If these spot quotations are available from only one Reference Bank, then the Calculation Agent, in its sole discretion, will determine whether that quotation is reasonable to be used. If no spot quotation is available, then the Reference Exchange Rate, Final Spot Rate or other rate, as applicable, for such Basket Currency will be determined by the Calculation Agent in good faith and in a commercially reasonable manner.

The “Calculation Agent” means Lehman Brothers Inc.

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

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: February 14, 2008

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name: Andrew Yeung
		Title: Vice President


	Attest:
		Name: Cindy Buckholz
		Title: Assistant Secretary

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 I

NOTES LINKED TO AN INDIA AND CHINA CURRENCY BASKET
DUE FEBRUARY 14, 2012

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series I, Notes Linked to an India and China Currency Basket (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.

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

Section 10. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 11. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

EX-4.03 4 a08-4165_115ex4d03.htm EX-4.03

Exhibit 4.03

CUSIP NO. 5252M0BV8

ISIN NO. US5252M0BV87

REGISTERED

PRINCIPAL AMOUNT: $508,000

No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

NOTES LINKED TO A CURRENCY BASKET
DUE FEBRUARY 12, 2010

The “Maturity Date” is February 12, 2010, or if such day is not a Business Day, on the next following Business Day.

The “Redemption Amount” is the amount equal to the sum of the principal amount of the Notes, plus $1,000, plus the Additional Amount, if any.

The “Additional Amount” is an amount per Note equal to the greater of (a) zero and (b) $1,000 multiplied by the product of the Basket Return times the Participation Rate.

The “Participation Rate” is 135%.

The “Basket” is the Euro (EUR), Japanese Yen (JPY), British Pound Sterling (GBP), Canadian Dollar (CAD), Swedish Krona (SEK) and Swiss Franc (CHF), each a “Basket Currency” and collectively the “Basket Currencies”.

The “Basket Return” is a quotient, the numerator of which is the difference of the Basket Ending Level minus the Basket Starting Level and the denominator of which is the Basket Starting Level.

The “Basket Starting Level” is set equal to 100 on the Trade Date.

The “Basket Ending Level” is the Basket closing level on the Valuation Date, equal to the product of 100 times the sum of 1 plus the sum of the Weighted Currency Returns.

The “Weighted Currency Return” for each Basket Currency is the product of the Currency Return for such Basket Currency times the Basket Currency Weighting for such Basket Currency.

The “Currency Return” for each of EUR and GBP is a quotient, the numerator of which is the difference of the Initial Spot Rate for such Basket Currency minus the Final Spot Rate for such Basket Currency and the denominator of which is the Initial Spot Rate for such Basket Currency. The Currency Return for each of JPY, CAD, SEK and CHF is a quotient, the numerator of which is the difference between the Final Spot Rate for such Basket Currency minus the Initial Spot Rate for such Basket Currency and the denominator of which is the Final Spot Rate for such Basket Currency.

The “Weighting” and “Initial Spot Rate” for each Basket Currency are as follows:

Basket Currency	Weighting		Initial Spot Rate
EUR	57.6	%	1.4497
JPY	13.6	%	107.45
GBP	11.9	%	1.9463
CAD	9.1	%	0.9971
SEK	4.2	%	6.4887
CHF	3.6	%	1.1053

The “Reference Exchange Rates” are, for EUR and GBP, the spot exchange rates for each of EUR and GBP quoted against the U.S. dollar, expressed as the number of units of USD per unit of Basket Currency. The Reference Exchange Rates for JPY, CAD, SEK and CHF are spot exchange rate for each of JPY, CAD, SEK and CHF, respectively, quoted against the U.S. dollar, expressed as the number of units of the Basket Currency per one USD.

The “Issue Date” is February 14, 2008.

If a Disruption Event relating to one or more of the Basket Currencies is in effect on the scheduled Valuation Date, the Calculation Agent will calculate the Basket Return using:

· for each Basket Currency that did not suffer a Disruption Event on the scheduled Valuation Date, the Final Spot Rate on the scheduled Valuation Date, and

A “Disruption Event” means any of the following events with respect to a Basket Currency, 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 (x) for any Basket Currency other

than EUR, the delivery of USD from accounts inside the Basket Currency Jurisdiction for that Basket Currency to accounts outside that Basket Currency Jurisdiction; or (y) the conversion of the Reference Currency into USD through customary legal channels;

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

Basket Currency	Screen Reference*	Valuation Business Day
EUR	Reuters page EURUSDFIXM=WM (as substitute for 1FED)	London
JPY	Reuters page USDJPYFIXM=WM (as substitute for 1FED)	London
GBP	Reuters page GBPUSDFIXM=WM (as substitute for 1FED)	London
CAD	Reuters page USDCADFIXM=WM (as substitute for 1FED)	London
SEK	Reuters page USDSEKFIXM=WM (as substitute for 1FED)	London
CHF	Reuters page USDCHFFIXM=WM (as substitute for 1FED)	London

*In each case, as observed at approximately 4.00 p.m. London time.

The “Spot Rate Source” for the EUR 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. The Spot Rate Source for the JPY is the 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 relevant Valuation Date. The Spot Rate Source for GBP is the U.S. Dollar/Sterling official

fixing rate, expressed as the amount of U.S. Dollars per one Sterling, 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 “GBP” at approximately 10.00 a.m., New York time, on the relevant Valuation Date. The Spot Rate Source for the CAD is 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 relevant Valuation Date. The Spot Rate Source for the SEK is the Swedish Krona/U.S. Dollar official fixing rate, expressed as the amount of Swedish Krona 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 “SEK” at approximately 10.00 a.m., New York time, on the relevant Valuation Date. The Spot Rate Source for the CHF is the Swiss Franc/U.S. Dollar official fixing rate, expressed as the amount of Swiss Francs 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 “CHF” at approximately 10.00 a.m., New York time, on the relevant Valuation Date. The term “business day” solely as used in any Spot Rate Source described above shall mean 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 Principal Financial Center for both (a) the Basket Currency and (b) the currency against which the Basket Currency is quoted (the “base currency”) in accordance with the Reference Exchange Rate specified in the applicable pricing supplement, in each case as specified for the applicable Basket Currency or base currency in the table above.

whether that quotation is reasonable to be used. If no spot quotation is available, then the Reference Exchange Rate, Final Spot Rate or other rate, as applicable, for such Basket Currency will be determined by the Calculation Agent in good faith and in a commercially reasonable manner.

The “Calculation Agent” means Lehman Brothers Inc.

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

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: February 14, 2008

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name:		Andrew Yeung
		Title:		Vice President


	Attest:
		Name:	Cindy Buckholz
		Title:	Assistant Secretary

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 I

NOTES LINKED TO A CURRENCY BASKET
DUE FEBRUARY 12, 2010

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series I, Notes Linked to a Currency Basket (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.

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.

Section 10. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 11. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

EX-4.04 5 a08-4165_115ex4d04.htm EX-4.04

Exhibit 4.04

CUSIP NO. 5252M0BR7

ISIN NO. US5252M0BR75

REGISTERED

PRINCIPAL AMOUNT: $688,000

No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

NOTES LINKED TO A BASKET OF COMMODITIES
DUE FEBRUARY 14, 2012

The “Maturity Date” is February 14, 2012, or if such day is not a Business Day, on the next following Business Day.

The “Valuation Date” is February 7, 2012, or if such day is not a Valuation Business Day, the immediately preceding Valuation Business Day; provided that if a Disruption Event is in effect on the scheduled Valuation Date, the Valuation Date may be postponed (as described below).

The “Redemption Amount at Maturity” for each $1,000 note will be a single U.S. dollar payment on the Maturity Date equal to:

(A) $1,000, plus the product of $1,000 times the Basket Return times the Participation Rate, if the Final Basket Level is greater than the Initial Basket Level; or

(B) $1,000, if the Final Basket Level is equal to or less than the Initial Basket Level.

The “Component Commodities” and “Component Commodity Weightings” are as follows:

Component Commodities	Component Commodity Weighting
Light sweet crude oil (“Crude Oil”)	10	%
Brent crude oil (“Brent Crude Oil”)	10	%
No. 2 fuel heating oil (“Heating Oil”)	10	%
Copper – Grade A (“Copper”)	10	%
Primary Nickel (“Nickel”)	10	%
Special High Grade Zinc (“Zinc”)	10	%
Gold (“Gold”)	10	%
Cocoa (“Cocoa”)	10	%
Class III milk (“Milk”)	10	%
Soybeans (“Soybeans”)	10	%

The “Participation Rate” is 110%.

The “Basket Return” is a quotient, the numerator of which is the difference of the Final Basket Level minus the Initial Basket Level and the denominator of which is the Initial Basket Level, expressed as a percentage rounded to three decimal places.

The “Initial Basket Level” is set to 100 on the Trade Date.

The “Final Basket Level” is the product of 100 times the sum of 1 plus the sum of the Weighted Component Commodity Returns.

The “Trade Date” is February 8, 2008.

The “Issue Date” is February 14, 2008.

The “Weighted Component Commodity Returns” are, for each Component Commodity, the product of the Component Commodity Weighting times a quotient, the numerator of which is the difference of the Final Commodity Price minus the Initial Commodity Price and the denominator of which is the Initial Commodity Price for such Component Commodity.

The “Initial Commodity Price” and “Relevant Exchange” for each Component Commodity are as follows:

Component Commodity	Initial Commodity Price		Relevant Exchange
Crude Oil	$	91.77	The NYMEX Division, or its successor, of the New York Mercantile Exchange, Inc. (“NYMEX”)
Brent Crude Oil	$	91.94	The Intercontinental Exchange (“ICE”)
Heating Oil	$	2.5541	NYMEX
Copper	$	7,612.00	London Metals Exchange (“LME”)
Nickel	$	27,355.00	LME
Zinc	$	2,345.00	LME
Gold	$	916.25	The market in London on which members of the London Bullion Market Association (“LBMA”) quote prices for the buying and selling of Gold.
Cocoa	$	2,378.00	The New York Board of Trade (“NYBOT”)
Milk	$	17.27	CME Group (“CME”) (as successor to The Chicago Board of Trade and the Chicago Mercantile Exchange)
Soybeans	$	1,339.00	CME

The “Final Commodity Price” is, for each Component Commodity, the Commodity Price of the Component Commodity on the Valuation Date, subject to the occurrence of a Disruption Event.

A “Valuation Business Day” is a day, as determined in good faith by the Calculation Agent, on which the Relevant Exchange for each Component Commodity is scheduled to be (or, but for the occurrence of a Disruption Event, would have been) open for trading during its regular trading session (notwithstanding the Relevant Exchange or organized exchange or market, as applicable, closing prior to its scheduled closing time).

If a Disruption Event identified in clauses (A), (B) or (C) below relating to one or more Component Commodities is in effect on the scheduled Valuation Date, the Calculation Agent will calculate the Final Basket Level using:

· for each such Component Commodity that did not suffer a Disruption Event on the scheduled Valuation Date, the Final Commodity Price for that Component Commodity on the scheduled Valuation Date, and

· for each such Component Commodity that did suffer a Disruption Event on the scheduled Valuation Date, the Final Commodity Price on the immediately succeeding trading day for such Component Commodity on which no Disruption Event occurs or is continuing with respect to such Component Commodity;

provided however that if a Disruption Event has occurred or is continuing with respect to a Component Commodity on each of the three scheduled trading days following the scheduled Valuation Date, then (a) that third scheduled trading day shall be deemed the Valuation Date for the affected Component Commodity; and (b) the Calculation Agent will determine the Final Commodity Price for the affected Component Commodity on such day in its sole and absolute discretion taking into account the latest available quotation for the Commodity Price for the affected Component Commodity and any other information that in good faith it deems relevant.

If a Disruption Event identified in clauses (D) or (E) below relating to one or more Component Commodities (other than Gold) is in effect on the Valuation Date, the Calculation Agent will determine the Final Commodity Price for the affected Component Commodity on the scheduled Valuation Date in its sole and absolute discretion taking into account the latest available quotation for the Commodity Price for the affected Component Commodity and any other information that in good faith it deems relevant.

A “Disruption Event” for a Component Commodity means any of the following events, in each case as determined in good faith by the Calculation Agent:

(A) the suspension of or material limitation on trading in the Component Commodity or futures contracts or options related to the Component Commodity, on the Relevant Exchange for that Component Commodity;

(B) either (i) the failure of trading to commence, or permanent discontinuance of trading, in the Component Commodity, or futures contracts or options related to the Component Commodity, on the Relevant Exchange for that Component Commodity, or (ii) the disappearance of, or of trading in, the Component Commodity;

(C) the failure of the Relevant Exchange for the Component Commodity to publish the official daily settlement price of the Component Commodity for that day (or the information necessary for determining the settlement price); and

(D) solely with respect to Component Commodities other than Gold, the occurrence since the Trade Date of a material change in the content, composition, or constitution of the Component Commodity; or

(E) solely with respect to Component Commodities other than Gold, the occurrence since the Trade Date of a material change in the formula for or

the method of calculating the settlement price of the Component Commodity.

For the purpose of determining whether a Disruption Event for a Component Commodity has occurred:

(1) a limitation on the hours in a trading day and/or number of days of trading will not constitute a Disruption Event if it results from an announced change in the regular business hours of the Relevant Exchange for the Component Commodity;

(2) a suspension in trading in a Component Commodity on the Relevant Exchange for that Component Commodity (without taking into account any extended or after-hours trading session), by reason of a price change reflecting the maximum permitted price change from the previous trading day’s settlement price will constitute a Disruption Event; and

(3) a suspension of or material limitation on trading on a Relevant Exchange for a Component Commodity will not include any time when the Relevant Exchange for that Component Commodity is closed for trading under ordinary circumstances.

For purposes of calculating the Final Basket Level in the event of a Disruption Event relating to one or more Component Commodities in accordance with the above, “trading day” means a day, as determined in good faith by the Calculation Agent, on which trading is generally conducted on the Relevant Exchange applicable to the affected Component Commodity.

The “Calculation Agent” means Lehman Brothers Commodity Services Inc, the determinations and calculations of which will be binding absent manifest error.

Except as provided below, any Redemption Amount at Maturity 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 any Redemption Amount at Maturity will be made in immediately available funds in accordance with the normal procedures of the Trustee (or any duly appointed Paying Agent).

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: February 14, 2008

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name:	Andrew M.W. Yeung
		Title:	Vice President


	Attest:
		Name:	Cindy Buckholz
		Title:	Assistant Secretary

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 I

NOTES LINKED TO A BASKET OF COMMODITIES
DUE FEBRUARY 14, 2012

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series I, Notes Linked to a Basket of Commodities (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 Redemption Amount at Maturity 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 at Maturity 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 Redemption Amount at Maturity 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 any Redemption Amount at Maturity on this Note at the place, at the respective times, at the rate, and in the coin or currency herein prescribed.

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 for the period from and including the Original Issue Date to but excluding the date of early repayment and will equal, for each note, the Redemption Amount at Maturity, calculated as the date of early repayment were the Maturity Date. If a bankruptcy proceeding is commenced in respect of Lehman Brothers Holdings, the claim of the beneficial owner of a note for the period from and including the Original Issue Date to but excluding the date of early repayment will be capped at the Redemption Amount at Maturity, calculated as though the date of the commencement of the proceeding were the Maturity Date.

Section 9. No Recourse Against Certain Persons. No recourse for the payment of the Redemption Amount at Maturity 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. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 11. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

EX-4.05 6 a08-4165_115ex4d05.htm EX-4.05

Exhibit 4.05

CUSIP NO. 5252M0DK0

ISIN NO. US5252M0DK05

REGISTERED

PRINCIPAL AMOUNT: $14,600,000

No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

PRINCIPAL PROTECTED NOTES LINKED TO MARQCUS PORTFOLIO A (USD) INDEX
DUE FEBRUARY 16, 2010

The “Maturity Date” is February 16, 2010, or if such day is not a Business Day, on the next following Business Day.

The “Redemption Amount” is the amount equal to the sum of the principal amount of the Notes plus the Additional Amount, if any, rounded to the nearest whole U.S. cent.

The “Additional Amount” is, for each note, a single U.S. dollar payment calculated by the Calculation Agent equal to the principal amount of the note multiplied by:

(A) Leverage x Index Return, if the Index Return is greater than 0.0%; or

(B) 0%, if the Index Return is equal to or less than 0.0%.

The “Leverage” is 150%.

The “Trade Date” is February 8, 2008.

The “Issue Date” is February 14, 2008.

The “Valuation Date” is February 8, 2010, or if such day is not an Index Business Day, the immediately preceding Index Business Day; provided that if the Final Index Level is not available on the scheduled Valuation Date due to Index Unavailability, as described under “Index Unavailability” below, the Valuation Date may be postponed (as described below).

The “Index” is the Lehman Brothers Macro Quantitative Currency Trading Strategies (“MarQCuS”) Portfolio A (USD) Index, calculated and published by the Index Calculation Agent.

The “Index Return” is a quotient, the numerator of which is the Final Index Level minus the Initial Index Level and the denominator of which is the Initial Index Level, expressed as a percentage.

The “Final Index Level” is the closing value of the Index on the Valuation Date, as calculated by the Index Calculation Agent (subject to the occurrence of Index Unavailability).

The “Initial Index Level” is 193.82, which is equal to the closing value of the Index on the Trade Date, as calculated by the Index Calculation Agent.

The “Index Level” is the closing level of the Index, as calculated by the Index Calculation Agent and published on the Price Source, subject to adjustment in accordance with the Index Adjustment below.

An “Index Business Day” is a day on which commercial banks are open, including for dealings in foreign exchange in accordance with market practice of the foreign exchange market, in both London and New York.

“Index Unavailability” means that the Index Level for the Valuation Date is not published on the Price Source.

MarQCuS Index	Bloomberg Page (Price Source) *	Reuters Page (Fallback Price Source) *
Forward Bias G10 Index	LBMQMFG <INDEX>	.LBMQMFG
Forward Bias Emerging Market (EM) Index	LBMQMFE <INDEX>	.LBMQMFE
TurnRate Index and	LBMQMTR <INDEX>	.LBMQMTR
Major/Miner Index	LBMQMMM <INDEX>	.LBMQMMM
CoBALT Index LBFX GBP	LBMQMCO <INDEX>	.LBMQMCO
RAFT Index	LBMQMRF <INDEX>	.LBMQMRF

For purposes of calculating the MarQCuS Portfolio A Index, the term “Price Source” and “Fallback Price Source” includes any (a) successor page to or (b) solely in the event the Index Calculation Agent determines in good faith that the indicated Bloomberg or Reuters pages is no longer a materially accurate source for the level of any MarQCuS Index, any replacement page for, to the indicated Bloomberg and Reuters pages, respectively, on which the level of the relevant MarQCuS Index may be published, as determined in the Index Calculation Agent acting in good faith.

If the Index Calculation Agent determines in good faith that the Index Level for the Valuation Date was not published on the Price Source, the Calculation Agent will determine the Final Index Level using the Index Level published on the Fallback Price Source for such Valuation Date. If the Index Calculation Agent determines in good faith that the Index Level for the Valuation Date was also not published on the Fallback Price Source, the Calculation Agent will calculate the Index Return using as the Final Index Level the Index Level published for the first Index Business Day succeeding the scheduled Valuation Date; provided however that if no Index Level is published on the Price Source or Fallback Price Source for each of the three scheduled Index Business Days following the scheduled Valuation Date, then (a) the third scheduled Index Business Day shall be deemed the Valuation Date and (b) the Calculation Agent will determine the Final Index Level on such third scheduled Index Business Day in good faith in accordance with the formula for and method of calculating the Index last in effect prior to commencement of the Index Unavailability, taking in to account the latest available Index Level and any other information that it deems relevant.

If the Index Calculation Agent discontinues publication of the Index prior to, and such discontinuation is continuing on, the Valuation Date, and the Index Calculation Agent or another entity publishes a successor or substitute index that the Calculation Agent determines in good faith to be comparable to the discontinued Index (such index, a “Successor Index”), then the Final Index Level will be determined by reference to the closing level of such Successor Index on the Valuation Date; provided, however, that the Calculation Agent may make such adjustments as it deems necessary, acting in good faith, to the level of the Successor Index so that the level of the Successor Index reflects the same level as that of the Index before it was discontinued. Upon any selection by the Calculation Agent of a Successor Index, the Calculation

Agent will cause written notice thereof to be promptly furnished to the trustee, to the Issuer and to the holders of the notes.

If the Index Calculation Agent discontinues publication of the Index prior to, and such discontinuation is continuing on, the Valuation Date, and the Calculation Agent determines in good faith that no Successor Index is available at such time, then the Calculation Agent will determine the Final Index Level on the Valuation Date. The Final Index Level will be computed by the Calculation Agent in accordance with the formula for and method of calculating the Index last in effect prior to such discontinuation, taking in to account the latest available Index Level and any other information that it deems relevant.

In the event that there is any error in relation to the calculation or publication of the Final Index Level and the Index Calculation Agent publishes an adjustment or correction to such Final Index Level on or prior to the Business Day immediately preceding the Maturity Date, the Calculation Agent will calculate the Redemption Amount using the Final Index Level as so adjusted or corrected.

If the Calculation Agent, acting in good faith, determines that the Index has been or will be rebased on or prior to the Valuation Date, the Index as so rebased will be used for purposes of calculating the Redemption Amount; provided, however, that the Calculation Agent may make such adjustments it considers necessary, if any, to the level of the Index so rebased so that the Final Index Level reflects the same Index Level for the Index on the Valuation Date before such rebasing.

If the Index Calculation Agent, acting in good faith, determines that on any Index Business Day that a component MarQCuS Index (a) is no longer available or (b) has been materially modified and such modification will have a materially adverse effect on the MarQCuS Portfolio A Index, the Index Calculation Agent shall remove or replace such affected component MarQCuS Index with an alternative index or rate, variable or other component, and may make such adjustments to the level of such replacement index or rate, variable or other component as it considers necessary so that the level of the MarQCuS Portfolio A Index after such removal or replacement reflects a similar level to that calculated prior to the removal or replacement, acting in good faith. Following the removal or replacement of a component MarQCuS Index, the Index Calculation Agent will promptly publish a notice which specifies the component MarQCuS Index removed or replaced and any designated replacement thereof.

The “Calculation Agent” means Lehman Brothers Inc.

The “Index Calculation Agent” means Lehman Brothers International (Europe).

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

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: February 14, 2008

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name:	Andrew M.W. Yeung
		Title:	Vice President


	Attest:
		Name:	Cindy Buckholz
		Title:	Assistant Secretary

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 I

PRINCIPAL PROTECTED NOTES LINKED TO MARQCUS PORTFOLIO A (USD) INDEX
DUE FEBRUARY 16, 2010

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series I, Principal Protected Notes Linked to MarQCuS Portfolio A (USD) Index (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 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 $100,000 or integral multiples of $100,000, 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 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. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 11. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

EX-4.06 7 a08-4165_115ex4d06.htm EX-4.06

Exhibit 4.06

CUSIP NO. 5252M0DL8

ISIN NO. US5252M0DL87

REGISTERED

PRINCIPAL AMOUNT: $600,000

No. R-1

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

RETURN ENHANCED NOTES LINKED TO MARQCUS PORTFOLIO A (USD) INDEX
DUE FEBRUARY 14, 2011

The “Maturity Date” is February 14, 2011, or if such day is not a Business Day, on the next following Business Day.

The “Redemption Amount” is the amount equal to the sum of the principal amount of the Notes plus the Adjustment Amount, which may be negative, rounded to the nearest whole U.S. cent. If the Adjustment Amount is negative, the value of the Adjustment Amount will be subtracted from the principal amount of the notes for purposes of calculating the Redemption Amount.

The “Adjustment Amount” is, for each note, a single U.S. dollar payment calculated by the Calculation Agent equal to the principal amount of the note multiplied by:

(A) Leverage x Index Return, if the Index Return is greater than or equal to 0.0%; or

(B) 0%, if the Index Return is less than 0.0%.

The “Leverage” is 300%.

The “Trade Date” is February 8, 2008.

The “Issue Date” is February 14, 2008.

The “Valuation Date” is February 7, 2011, or if such day is not an Index Business Day, the immediately preceding Index Business Day; provided that if the Final Index Level is not available on the scheduled Valuation Date due to Index Unavailability, as described under “Index Unavailability” below, the Valuation Date may be postponed (as described below).

The “Index” is the Lehman Brothers Macro Quantitative Currency Trading Strategies (“MarQCuS”) Portfolio A (USD) Index, calculated and published by the Index Calculation Agent.

The “Index Return” is a quotient, the numerator of which is the Final Index Level minus the Initial Index Level and the denominator of which is the Initial Index Level, expressed as a percentage.

The “Final Index Level” is the closing value of the Index on the Valuation Date, as calculated by the Index Calculation Agent (subject to the occurrence of Index Unavailability).

The “Initial Index Level” is 193.82, which is equal to the closing value of the Index on the Trade Date, as calculated by the Index Calculation Agent.

“Index Unavailability” means that the Index Level for the Valuation Date is not published on the Price Source.

MarQCuS Index	Bloomberg Page (Price Source) *	Reuters Page (Fallback Price Source) *
Forward Bias G10 Index	LBMQMFG <INDEX>	.LBMQMFG
Forward Bias Emerging Market (EM) Index	LBMQMFE <INDEX>	.LBMQMFE
TurnRate Index and	LBMQMTR <INDEX>	.LBMQMTR
Major/Miner Index	LBMQMMM <INDEX>	.LBMQMMM
CoBALT Index LBFX GBP	LBMQMCO <INDEX>	.LBMQMCO
RAFT Index	LBMQMRF <INDEX>	.LBMQMRF

For purposes of calculating the MarQCuS Portfolio A Index, the term “Price Source” and “Fallback Price Source” includes any (a) successor page to or (b) solely in the event the Index Calculation Agent determines in good faith that the an indicated Bloomberg or Reuters pages is no longer a materially accurate source for the level of any MarQCuS Index, any replacement page for, to the indicated Bloomberg and Reuters pages, respectively, on which the level of the relevant MarQCuS Index may be published, as determined in the Index Calculation Agent acting in good faith.

adjustments as it deems necessary, acting in good faith, to the level of the Successor Index so that the level of the Successor Index reflects the same level as that of the Index before it was discontinued. Upon any selection by the Calculation Agent of a Successor Index, the Calculation Agent will cause written notice thereof to be promptly furnished to the trustee, to the Issuer and to the holders of the notes.

The “Calculation Agent” means Lehman Brothers Inc.

The “Index Calculation Agent” means Lehman Brothers International (Europe).

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

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: February 14, 2008

[SEAL]	LEHMAN BROTHERS HOLDINGS INC.


	By:
		Name:	Andrew M.W. Yeung
		Title:	Vice President


	Attest:
		Name:	Cindy Buckholz
		Title:	Assistant Secretary

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 I

RETURN ENHANCED NOTES LINKED TO MARQCUS PORTFOLIO A (USD) INDEX
DUE FEBRUARY 14, 2011

Section 1. General. This Note is one of a duly authorized series of Notes of the Company designated as the Medium-Term Notes, Series I, Return Enhanced Notes Linked to MarQCuS Portfolio A (USD) Index (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 Adjustment 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 Adjustment 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 Adjustment 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 Adjustment 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 $100,000 or integral multiples of $100,000, 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 10. Defined Terms. All terms used but not defined in this Note are used herein as defined in the Indenture.

Section 11. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

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