New Issue: Lehman prices $10 million notes linked to International Paper at 0.25%, up 7.01%

New York, June 24 - Lehman Brothers Holdings Inc. priced $10 million of 0.25% seven-year notes performance linked to International Paper Co. common stock with a 7.01% initial exchange premium, according to a 424B5 filing with the Securities and Exchange Commission.

The notes have a cash or stock payout at maturity linked to International Paper and can be converted at any time for stock at the holder's option.

Issuer:	Lehman Brothers Holdings Inc.
Issue:	Performance-linked medium-term senior notes
Underlying stock:	International Paper Co.
Amount:	$10 million
Greenshoe:	$1.5 million
Maturity:	June 29, 2012
Coupon:	0.25%
Price:	Par
Yield:	0.25%
Exchange premium:	7.01%
Exchange price:	$36.23112
Payout at maturity:	Greater of par in cash or percentage appreciation above exchange price (7.01% above $33.8577 price Lehman paid to hedge notes), in cash or stock at Lehman's option
Call:	June 22, 2008 onwards with same payout calculation as at maturity
Pricing date:	June 22
Settlement date:	June 29
Underwriter:	Lehman Brothers
Distribution:	Off shelf

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