New Issue: Lehman prices $1.07 million 18% reverse exchangeables linked to Research In Motion

By Angela McDaniels

Tacoma, Wash., Feb. 7 - Lehman Brothers Holdings Inc. priced $1.07 million of reverse exchangeable notes due May 12, 2008 linked to the common stock of Research In Motion, Ltd., according to a 424B2 filing with the Securities and Exchange Commission.

The three-month notes will pay 4.5% for an annualized rate of 18%. Interest is payable monthly.

The payout at maturity will be par unless Research In Motion shares fall by more than 40% during the life of the notes and finish below the initial share price, in which case the payout will be a number of Research In Motion shares equal to $1,000 divided by the initial share price or, at Lehman's option, the equivalent cash value.

Lehman Brothers Inc. is the underwriter.

Issuer:	Lehman Brothers Holdings Inc.
Issue:	Reverse exchangeable notes
Underlying stock:	Research In Motion Ltd. (Nasdaq: RIMM)
Amount:	$1,065,000
Maturity:	May 12, 2008
Coupon:	18%, payable monthly
Price:	Par
Payout at maturity:	If Research In Motion shares close below the trigger price during the life of the notes and the final share price is less than the initial share price, 11.89061 Research In Motion shares or the equivalent cash value; otherwise, par
Initial share price:	$84.10
Trigger price:	$50.46, 60% of initial share price
Pricing date:	Feb. 6
Settlement date:	Feb. 11
Underwriter:	Lehman Brothers Inc.
Fees:	1.7%

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