Exhibit
4.01


MEDIUM-TERM NOTE — MASTER
NOTE


 


	
  

  	
  August 2, 2007

  
	
   

  	
  (Date of Issuance)

  



 


Lehman Brothers Holdings
Inc. (“Issuer”), a corporation organized and existing under
the laws of the State of Delaware, for value received, hereby promises
to pay to Cede & Co. or its registered assigns:  (i) on each principal payment date, including
each amortization date, redemption date, repayment date, maturity date, and
extended maturity date, as applicable, of each obligation identified on the
records of Issuer (which records are maintained by Citibank, N.A. (“Paying
Agent”)) as being evidenced by this Master Note, the principal amount then due
and payable for each such obligation, and (ii) on each interest payment date,
if any, the interest then due and payable on the principal amount for each such
obligation.  Payment shall be made by
wire transfer of United States dollars to the registered owner, or in
immediately available funds or the equivalent to a party as authorized by the
registered owner and in the currency other than United States dollars as
provided for in each such obligation, by Paying Agent without the necessity of
presentation and surrender of this Master Note.


REFERENCE IS HEREBY MADE
TO THE FURTHER PROVISIONS OF THIS MASTER NOTE SET FORTH ON THE REVERSE HEREOF.


This Master Note is a valid and binding obligation of
Issuer.


IN WITNESS WHEREOF, Issuer has caused this instrument
to be duly executed under its corporate seal.


	
  ATTEST:

  	
  Lehman Brothers
  Holdings Inc.

  
	
   

  	
  (Issuer)

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
  (Signature)

  	
   

  	
  (Authorized
  Signature)

  	
   

  



 


This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture.


 


	
  

  	
  Citibank, N.A.

  
	
   

  	
  (Trustee)

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  (Authorized Signature)

  	
   

  



 













 


	
  This Master Note evidences indebtedness of
  Issuer of a single Series 

  	
  D

  	
   

  
	
   

  	
  (Series
  Designator)

  	
   

  
	
  and Rank

  	
  senior, which are
  designated Lehman Notes

  	
   

  
	
   

  	
  (Secured/Unsecured/Senior/Junior/Subordinated/Unsubordinated)

  
					



(the “Debt
Obligations”), all issued or to be issued under and pursuant to an Indenture
dated as of September 1, 1987, as amended (the “Indenture”), duly
executed and delivered by Issuer to Citibank, N.A., as Trustee (“Trustee”),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a description of the rights, duties, and immunities thereunder of
Trustee and the rights thereunder of the holders of the Debt Obligations.  As provided in the Indenture, the Debt
Obligations may mature at different times, may bear interest, if any, at
different rates, may be subject to different redemption and repayment
provisions, if any, may be subject to different sinking, purchase, or analogous
funds, if any, may be subject to different covenants and events of default, any
may otherwise vary as in the Indenture provided or permitted.  The Debt Obligations aggregated with any
other indebtedness of Issuer of this Series are indeterminate and
designated as the Medium-Term Notes of Issuer.


No reference herein to
the Indenture and no provision of this Master Note or of the Indenture shall
alter or impair the obligation of Issuer, which is absolute and unconditional,
to pay the principal of, premium, if any, and interest, if any, on each Debt
Obligation at the times, places, and rates, and in the coin or currency,
identified on the records of Issuer.


At the request of the
registered owner, Issuer shall promptly issue and deliver one or more separate
note certificates evidencing each Debt Obligation evidenced by this Master
Note.  As of the date any such note
certificate or certificates are issued, the Debt Obligations which are
evidenced thereby shall no longer be evidenced by this Master Note.






FOR VALUE RECEIVED, the undersigned hereby sells,
assigns and transfers unto


	
  

  	
   

  	
   

  
	
  

  	
  (Name, Address,
  and Taxpayer Identification Number of Assignee)

  	
   

  



 


the Master Note and all rights thereunder, hereby
irrevocably constituting and appointing                                   
attorney to transfer said Master Note on the books of Issuer with full power of
substitution in the premises.


	
  Dated:

  	
   

  	
   

  
	
   

  	
  (Signature)

  	
   

  
	
   

  	
   

  
	
  Signature(s) Guaranteed:

  	
  NOTICE: The signature on this assignment must
  correspond with the name as written upon the face of this Master Note, in
  every particular, without alteration or enlargement or any change whatsoever.

  



 






 


Unless this certificate
is presented by an authorized representative of The Depository Trust Company, a
New York corporation (“DTC”), to Issuer or its agent for registration of
transfer, exchange, or payment, and any certificate issued is registered in the
name of Cede & Co. or in such other name as is requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or to such
other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has
an interest herein.


Reference is
hereby made to the further provisions of this Master Note set forth in the
Master Note Rider attached hereto.


 



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LEHMAN BROTHERS HOLDINGS
INC.


RIDER


TO MASTER NOTE DATED
AUGUST 2, 2007


LEHMAN NOTES, SERIES D


This RIDER
forms a part of and is incorporated into the Master Note dated August 2, 2007,
of Lehman Brothers Holdings Inc. (the “Issuer”) registered in the name of Cede
& Co, or its registered assigns, evidencing the Issuer’s Lehman Notes,
Series D (the “Debt Obligations”).


REFERENCE IS HEREBY MADE
TO THE FURTHER PROVISIONS OF SUCH MASTER NOTE (TOGETHER WITH THIS RIDER, HEREIN
REFERRED TO AS THIS “MASTER NOTE”) SET FORTH IN THE RECORDS OF THE ISSUER
MAINTAINED BY THE TRUSTEE, WHICH RECORDS CONSIST OF THE PRICING SUPPLEMENT(S)
TO THE PROSPECTUS SUPPLEMENT DATED AUGUST 2, 2007, AND PROSPECTUS DATED MAY 30,
2006 (EACH, AS IT MAY BE AMENDED OR SUPPLEMENTED, A “PRICING SUPPLEMENT”)
RELATING TO EACH ISSUANCE OF DEBT OBLIGATIONS, AS FILED BY THE ISSUER WITH THE
SECURITIES AND EXCHANGE COMMISSION.  SUCH
FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH FULLY
SET FORTH AT THIS PLACE.


THIS MASTER NOTE IS A
GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY (THE “DEPOSITORY”) OR A NOMINEE
THEREOF.  UNLESS AND UNTIL IT IS
EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN CERTIFICATED FORM, THIS
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 SUCH 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.


Section 1.  Defined
Terms.


“Interest payment date”, as used on the face of this
Master Note, shall have the same meaning as “Interest Payment Date”, as defined
in the Indenture.


“Issuer”, as used in this Master Note, shall have the
same meaning as “Company”, as defined in the Indenture.


“Principal payment date”, as used on the face of this
Master Note, shall have the same meaning as “Maturity”, as defined in the
Indenture.


All terms used but not defined in this Master Note are
used herein as defined in the Indenture.


Section 2.  General.  This Note is one of a duly authorized series
of Notes of the Issuer designated as the Lehman Notes, Series D.  The
Debt Obligations evidenced by this Master Note are one of an indefinite number
of series of debt securities of the Company (herein called the “Securities”)
issued or issuable under and pursuant to the Indenture.  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 repayment 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.


Each Pricing Supplement shall specify the terms of a
particular issuance of Debt Obligations that are not set forth, or are
different from those set forth, in this Master Note, including, without
limitation, the CUSIP


 



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Number, the aggregate principal amount of such
issuance (the “Principal Amount”), the issue date, the interest rate per annum,
the interest payment frequency, the first Interest Payment Date, the Maturity,
whether optional redemption applies to the Debt Obligations, the terms of such
optional redemption, if applicable, as set forth below, whether optional
repayment applies to the Debt Obligations, the terms of such optional
repayment, if applicable, as set forth below, and whether the Survivor’s Option
(as defined below) applies to the Debt Obligations.  The terms in a Pricing Supplement may vary
from and supersede the terms contained in this Master Note; if any terms in the
applicable Pricing Supplement are inconsistent with this Master Note, the terms
in the Pricing Supplement shall control.


The Issuer may, without the consent of the holders of
the Debt Obligations, create and issue additional notes ranking equally with
the Debt Obligations and otherwise similar 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, so that such further notes shall be consolidated
and form a single issuance with the Debt Obligations; provided, however,
that no additional notes can be issued if an Event of Default has occurred with
respect to the Debt Obligations.


Section 3.  Payments
of Principal and Interest.  Unless
otherwise stated in the applicable Pricing Supplement, if the applicable
Pricing Supplement provides for monthly interest payments, the Interest Payment
Date shall be the fifteenth day of each calendar month, commencing in the
calendar month that next succeeds the month of the Issue Date; if the
applicable Pricing Supplement provides for quarterly interest payments, the
Interest Payment Dates shall be the fifteenth day of each third month,
commencing in the third succeeding calendar month following the month of the
Issue Date; if the applicable Pricing Supplement provides for semiannual
interest payments, the Interest Payment Dates shall be the fifteenth day of
each sixth month, commencing in the sixth succeeding calendar month following
the month of the Issue Date; and if the applicable Pricing Supplement provides
for annual interest payments, the Interest Payment Date shall be the fifteenth
day of every twelfth month, commencing in the twelfth succeeding calendar month
following the month of the Issue Date. 
Interest on a Debt
Obligation shall be computed on the basis of a 360-day year of twelve
30-day months or, in the case of an incomplete month, the number of days
elapsed.  Each payment of interest hereon
shall include interest accrued through the day before the Interest Payment Date
or date of Maturity, as the case may be. 
In no event shall the interest rate of a Debt Obligation be higher than the maximum rate permitted by applicable
law, as the same may be modified by United States law of general application.


Any payment of principal, premium, if any, or interest
to be made on any Interest Payment Date or on a date of Maturity that is not a
Business Day shall be made on the next succeeding Business Day with the same
force and effect as if made on such Interest Payment Date or such date of
Maturity, as the case may be, and no additional interest shall accrue as a
result of such delayed payment.


Unless otherwise stated in the applicable Pricing
Supplement, the interest so payable on any Interest Payment Date shall, subject
to certain exceptions provided in the Indenture, be paid to the person in whose
name a Debt Obligation is registered at the close of business on the fifteenth day
preceding the Interest Payment Date (the “Regular Record Date”), whether or not
a Business Day; provided, however, that, notwithstanding any
provision of the Indenture to the contrary, interest payable on any date of
Maturity shall be payable to the Person to whom principal shall be payable; and
provided, further, that, unless otherwise specified in the
applicable Pricing Supplement, in the case of a Debt Obligation initially
issued between a Regular Record Date and the Interest Payment Date relating to
such Regular Record Date, interest for the period beginning on the Issue Date
and ending on such Interest Payment Date shall be paid on the Interest Payment
Date following the next succeeding Regular Record Date to the registered Holder
on such next succeeding Regular Record Date.


Section 4.  Redemption.  If so specified in the applicable Pricing
Supplement, the Issuer may at its option redeem a Debt Obligation (i) in whole
or from time to time in part, or (ii) in whole but not in part,  (a) on or after the date designated as the
initial Redemption Date in the applicable Pricing Supplement, or (b) on the
specific date or dates specified in the applicable Pricing Supplement, at
either a price based on a constant percentage of the Principal Amount of such
Debt Obligation as specified in the applicable Pricing Supplement or at prices
declining from the premium specified in the applicable Pricing Supplement, if
any, to 100% of the Principal Amount specified in the applicable Pricing
Supplement, together, in each case, with accrued interest to the Redemption
Date.  The Issuer may exercise such
option by causing the Trustee to mail by first-class mail to the Holder hereof
a notice of such redemption at least 30 but not more than 60 days prior to the
Redemption Date.  Unless otherwise
specified in


 



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the applicable Pricing Supplement, if less than all of
the Debt Obligations with like tenor and terms to a Debt Obligation are to be
redeemed, the Debt Obligations to be redeemed shall, in the case of Debt
Obligations evidenced by this Master Note, be determined by the Depository and
its direct and indirect participants in accordance with standing instructions
and customary practices, and, in the case of certificated Debt Obligations, be
selected by the Trustee by such method as the Trustee shall deem fair and
appropriate in accordance with the provisions of the Indenture.


Section 5.  Sinking
Funds.  Unless otherwise specified in
the applicable Pricing Supplement, no Debt Obligation shall be subject to any
sinking fund.


Section 6.  Optional
Repayment.  If so specified in the
applicable Pricing Supplement, all or a specified part of  a Debt Obligation shall be repayable prior to
the Maturity Date at the option of the Holder on the date or dates specified in
the applicable Pricing Supplement (each, an “Optional Repayment Date”) at the
price specified in the applicable Pricing Supplement (the “Optional Repayment
Price”), together with accrued interest to the applicable Optional Repayment
Date.  If a Debt Obligation is in
certificated form, in order for such Debt Obligation to be so repaid, the
Trustee must receive, at least 30 but not more than 45 days prior to an
Optional Repayment Date, either (i) such Debt Obligation with the form below
entitled “Option to Elect Repayment” duly completed or (ii) a telegram, telex,
fax or letter from a member of a national securities exchange or the National
Association of Securities Dealers, Inc. or a commercial bank or trust issuer in
the United States setting forth the name of the Holder hereof, the Principal
Amount, the Principal Amount to be repaid, a description of the tenor and terms
of such Debt Obligation, a statement that the option to elect repayment is
being exercised thereby and a guarantee that such Debt Obligation with the form
below entitled “Option to Elect Repayment” duly completed will be received by
the Paying Agent not later than five Business Days after the date of such
telegram, telex, fax or letter and such Debt Obligation and form duly completed
are received by the Paying Agent by such fifth Business Day.  Exercise of this repayment option shall be
irrevocable.  Unless otherwise stated in
the applicable Pricing Supplement, the repayment option may be exercised by the
Holder of a Debt Obligation with respect to less than the Principal Amount then
outstanding; provided, however, that the Principal Amount of the
Debt Obligation remaining outstanding after repayment is an authorized
denomination.


Section 7.  Survivor’s
Option.  If so specified in the
applicable Pricing Supplement, the Representative (defined below) of a deceased
beneficial owner of a Debt Obligation shall have the option to elect to require
repayment, in whole or from time to time in part, of such Debt Obligation
following the death of the beneficial owner (a “Survivor’s Option”). The
Survivor’s Option may not be exercised unless the Debt Obligation was acquired
by the beneficial owner at least six months prior to the trustee’s receipt of
written request for repayment as provided below.


If the Survivor’s Option is applicable to a Debt
Obligation, upon the valid exercise of the Survivor’s Option, the Issuer shall
repay the Debt Obligation (or portion thereof), properly tendered for repayment
by or on behalf of the person (the “Representative”) that has authority to act
on behalf of the deceased beneficial owner of a Debt Obligation under the laws
of the appropriate jurisdiction (including, without limitation, the personal
representative or executor of the deceased beneficial owner or the surviving
joint owner of the deceased beneficial owner) at a price equal to 100% of the
principal amount of the deceased beneficial owner’s beneficial interest in such
Debt Obligation plus accrued interest to the date of such repayment, subject to
the following limitations:


a.               The Issuer may, in
its sole discretion, (A)(i) limit the aggregate principal amount of Lehman
Notes issued prior to the date hereof, without regard to series or tranches, as
to which exercises of the Survivor’s Option shall be accepted from all deceased
beneficial owners in any calendar year (the “Annual Put Limitation”) to an
amount equal to the greater of $2,000,000 or 2.0% of the Outstanding principal
amount of Lehman Notes issued prior to the date hereof, without regard to
series or tranches, as of the end of the most recent calendar year, and (ii)
limit the aggregate principal amount of Lehman Notes issued prior to the date
hereof, without regard to series or tranches, as to which exercises of the
Survivor’s Option will be accepted in any calendar year from the authorized
representative for any individual deceased beneficial owner to $250,000 (the “Individual
Put Limitation”); and (B)(i) impose an Annual Put Limitation for Lehman Notes
issued on or after the date hereof, without regard to series or tranches, equal
to an amount equal to the greater of $1,000,000 or 1.0% of the


 



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Outstanding principal
amount of Lehman Notes issued on or after the date hereof, without regard to
series or tranches, and (ii) impose an Individual Put Limitation for Lehman
Notes issued on or after the date hereof, without regard to series or tranches,
of $125,000.


b.              The Issuer shall not
make principal repayments pursuant to exercise of the Survivor’s Option in
amounts that are less than the minimum authorized denomination, and, in the event
that any partial exercise of the Survivor’s Option or the limitations described
in the preceding sentence would result in the partial repayment of any Debt
Obligation, the principal amount of such Debt Obligation remaining Outstanding
after repayment must be at least the minimum authorized denomination.


c.               A valid exercise of
the Survivor’s Option with respect to any Debt Obligation (or portion thereof)
may not be withdrawn.


Each Debt Obligation (or portion thereof) that is
tendered pursuant to a valid exercise of the Survivor;s Option shall be
accepted in the order of all such exercises that are received by the Trustee,
except for any Debt Obligation (or portion thereof) the acceptance of which
would contravene (i) the applicable Annual Put Limitation, if applied, or (ii)
the applicable Individual Put Limitation, if applied, with respect to the
relevant individual deceased beneficial owner. If, as of the end of any
calendar year, the aggregate principal amount of Debt Obligations (or portions
thereof) that have been tendered pursuant to the valid exercise of the Survivor’s
Option during such year has exceeded either the applicable Annual Put
Limitation, if applied, or the applicable Individual Put Limitation, if
applied, for such year, any exercise(s) of the Survivor’s Option with respect
to Debt Obligations (or portions thereof) not accepted during such calendar
year because such acceptance would have contravened either such limitation, if
applied, shall be deemed to be tendered in the following calendar year in the
order all such Debt Obligations (or portions thereof) were originally tendered.
Any Debt Obligation (or portion thereof) accepted for repayment pursuant to
exercise of the Survivor’s Option shall be repaid on the first Interest Payment
Date that occurs 20 or more calendar days after the date of such acceptance. In
the event that a Debt Obligation (or any portion thereof) tendered for
repayment pursuant to a valid exercise of the Survivor’s Option is not
accepted, the Trustee shall deliver a notice by first-class mail to the
registered holder thereof, at its last known address as indicated in the
Security Register, that states the reason such Debt Obligation (or portion
thereof) has not been accepted for payment.


In order for a Survivor’s Option to be validly
exercised with respect to any Debt Obligation (or portion thereof), the Trustee
must receive from the Representative (i) a written request for repayment signed
by the Representative, and such signature must be guaranteed by a firm that is a
participant in the Security Transfer Agents Medallion Program, the New York
Stock Exchange Medallion Signature Program or the Stock Exchange Medallion
Program, (ii) appropriate evidence satisfactory to the Trustee that (A) the
deceased was the beneficial owner of such Debt Obligation at the time of death
and the interest in such Debt Obligation was acquired by the deceased
beneficial owner at least six months prior to the Trustee’s receipt of the
request for repayment, (B) the death of such beneficial owner has occurred, and
the date of such death, and (C) the Representative has authority to act on
behalf of the deceased beneficial owner, (iii) if the interest in such Debt
Obligation is held by a nominee or trustee of, custodian for, or another person
in a similar capacity to, the deceased beneficial owner, evidence satisfactory
to the Trustee from such nominee, trustee, custodian or similar person
attesting to the deceased’s beneficial ownership in such Debt Obligation, (iv)
tax waivers and such other instruments or documents that the Trustee reasonably
requires in order to establish the validity of the beneficial ownership of the
Debt Obligations and the claimant’s entitlement to payment, and (v) any
additional information the Trustee requires to evidence satisfaction of any
conditions to the exercise of such Survivor’s Option or to document beneficial
ownership or authority to make the election and to cause the repayment of such
Debt Obligation. Subject to the Issuer’s right hereunder to impose an Annual
Put Limitation and an Individual Put Limitation, all questions as to the
eligibility or validity of any exercise of the Survivor’s Option shall be
determined by the Trustee, in its sole discretion, which determination shall be
final and binding on all parties.


The death of a
person holding a beneficial ownership interest in a Debt Obligation: (a) with
any person in a joint tenancy with right of survivorship; or (b) with his or
her spouse in tenancy by the entirety, tenancy in common, as community property
or in any other joint ownership arrangement, shall be deemed the death of a
beneficial owner of that note, and the entire principal amount of the Debt
Obligation held in this manner shall be subject to repayment


 



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by the Issuer upon valid exercise of the Survivor’s Option; provided,
however, that the death of a person holding a beneficial ownership
interest in a Debt Obligation as tenant in common with a person other than his
or her spouse shall be deemed the death of a beneficial owner only with respect
to the such deceased person’s interests in the Debt Obligation, and only the
deceased beneficial owner’s percentage interest in the principal amount of the
Debt Obligation shall be subject to repayment. 
If the ownership interest in a Debt Obligation is held by a nominee for
a beneficial owner or by a custodian under the Uniform Gifts to Minors Act or
Uniform Transfer to Minors Act, or by a trustee of a trust that is wholly
revocable by the beneficial owner, or by a guardian or committee for a
beneficial owner, the death of the beneficial owner of that Debt Obligation
shall constitute the death of the beneficial owner for purposes of the Survivor’s
Option, if the beneficial ownership interest can be established to the
satisfaction of the Trustee.  In these
cases, the death of the nominee, custodian, trustee, guardian or committee
shall not be deemed the death of the beneficial owner of such Debt Obligation
for purposes of the Survivor’s Option.


Section 8.  Principal
Amount For Indenture Purposes.  For
the purpose of determining whether Holders of the requisite amount of Debt
Obligations outstanding under the Indenture have made a demand, given a notice
or waiver or taken any other action, the Outstanding principal amount of this
Master Note shall be deemed to be the aggregate principal amount Outstanding of
the Debt Obligations.


Section 9.  Modification
and Waivers.  The Indenture contains
provisions permitting the Issuer 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 principal amount thereof, or
reduce the rate or extend the time of payment of interest thereon or reduce any
premium payable on redemption, or make the principal thereof, or premium, if
any, or interest thereon payable in any coin or currency other than the lawful
currency of the United States of America, 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 or the
principal of, 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 Master Note shall be
conclusive and binding upon such Holder and upon all future holders and owners
of this Master Note and any Debt Obligations which may be issued in exchange or
substitution herefor, irrespective of whether or not any notation thereof is
made upon this Master Note or such other Debt Obligations.


Section 10.  Defeasance.  The Indenture contains provisions for the
discharge of the Indenture and defeasance at any time of the indebtedness on a
Debt Obligation upon compliance by the Issuer with certain conditions set forth
therein, which provisions apply to all Debt Obligations.


Section 11.  Authorized
Form and Denominations.  Unless
otherwise set forth in the applicable Pricing Supplement, Debt Obligations
shall be issued in denominations of $1,000 and any integral multiple of
$1,000.  Each Debt Obligation shall be
represented by this Master Note.


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, Debt
Obligations may be exchanged for an equal aggregate principal amount of Debt
Obligations of like tenor and of other authorized denominations, except that
Debt Obligations in global form shall not be exchangeable for Debt Obligations
in definitive certificated form except as provided below.


Section 12.  Registration of Transfer.  If at any time the Depository notifies the
Issuer that it is unwilling or unable to continue as Depository or if at any
time the Depository shall no longer be eligible under the


 



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Indenture, the Issuer may
appoint a successor Depository.  If (a) a
successor depository for any Debt Obligations is not appointed by the Issuer
within 90 days after the Issuer receives such notice or becomes aware of such
ineligibility or (b) the Issuer in its sole discretion decides to allow some or
all Debt Obligations to be exchangeable for definitive securities in registered
form, the Issuer shall issue, and the Trustee shall authenticate and deliver,
Debt Obligations in definitive form in an aggregate principal amount equal to
the Principal Amount of each such Debt Obligation, registered in the name or
names of the person or persons specified by the Depository in a written
instruction to the Security Registrar.


As provided in the
Indenture and subject to certain limitations as therein set forth, the transfer
of a Debt Obligation is registrable in the Security Register, upon surrender of
such Debt Obligation for registration of transfer, at the Corporate Trust
Office or other office or agency of the Issuer in a Place of Payment for such
Debt Obligation, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Issuer and the Security Registrar duly
executed by, the Holder hereof or the Holder’s attorney duly authorized in
writing, and thereupon one or more new Debt Obligations of this series of like
tenor and of authorized denominations and for the same aggregate principal
amount, shall be issued to the designated transferee or transferees.


No service charge shall be made for any such
registration of transfer or exchange, but the Issuer 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 a Debt Obligation for
registration of transfer, the Issuer, the Trustee and any agent of the Issuer
or of the Trustee may deem and treat the person in whose name such Debt
Obligation is registered as the absolute owner hereof (whether or not such Debt
Obligation shall be overdue and notwithstanding any notation of ownership or
other writing hereon), for the purpose of receiving payment hereof, or on
account hereof, and for all other purposes, and neither the Issuer nor the
Trustee nor any agent of the Issuer or of the Trustee shall be affected by any
notice to the contrary.  All such
payments made to or upon the order of such registered holder shall, to the
extent of the sum or sums paid, effectually satisfy and discharge liability for
moneys payable on such Debt Obligation.


Section 13.  Events
of Default.  If an Event of Default
with respect to this Master Note shall occur and be continuing, the outstanding
principal amount of this Master Note may be declared due and payable in the
manner and with the effect provided in the Indenture.  Upon payment (i) of the aggregate applicable
amounts of principal of this Master Note so declared due and payable and (ii)
of interest on any overdue principal and overdue interest (in each case to the
extent that the payment of such interest shall be legally enforceable), all of
the Issuer’s obligations in respect of the payment of the principal of and
interest, if any, on this Master Note shall terminate.


Section 14.  No
Recourse Against Certain Persons.  No
recourse for the payment of the principal of, or premium, if any, or interest
on this Master Note or any Debt Obligation, or for any claim based hereon or
otherwise in respect hereof, and no recourse under or upon any obligation,
covenant or agreement of the Issuer in the Indenture or any indenture
supplemental thereto or in this Master Note or any Debt Obligation, 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 Issuer or of any successor corporation, either directly or
through the Issuer 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 of
each Debt Obligation and as part of the consideration for the issue hereof and
of each Debt Obligation, expressly waived and released.


Section 15.  GOVERNING
LAW.  THIS MASTER NOTE AND THE DEBT
OBLIGATIONS EVIDENCED BY IT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.


 



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LEHMAN NOTES,
SERIES D


OPTION TO ELECT REPAYMENT


The
undersigned owner of the Debt Obligation specified below hereby irrevocably
elects to have the Issuer repay the principal amount of such Debt Obligation or
portion thereof below designated at (i) the Optional Repayment Percentage
multiplied by the principal amount of such Debt Obligation to be repaid in
respect of such principal amount plus accrued interest to the Optional
Repayment Date, if such Debt Obligation is to be repaid pursuant to the
Optional Repayment provision described in Section 6 of the Master Note
Rider.  Any such election is irrevocable.


 


	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  Signature

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Sign exactly as name appears on the front of this
  Debt Obligation [SIGNATURE GUARANTEED - required only if Debt Obligations are
  to be issued and delivered to other than the registered Holder]

  
	
   

  	
   

  
	
   

  	
   

  
	
  CUSIP No.:

  	
   

  	
   

  	
   

  
	
  Interest rate:

  	
   

  	
   

  	
   

  
	
  Maturity:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Principal Amount to be

  	
  Fill in for registration of

  
	
  repaid, if amount to be

  	
  Debt Obligations if to be issued otherwise than to
  the registered Holder:

  
	
  repaid is less than the

  	
   

  
	
  Principal Amount of this

  	
   

  
	
  Debt Obligation (Principal Amount

  	
  Name:

  	
   

  	
   

  
	
  remaining must be an

  	
  Address:

  	
   

  	
   

  
	
  autho­rized denomination)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (Please print name and address including zip code)

  
	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SOCIAL SECURITY OR OTHER TAXPAYER

  
	
   

  	
  ID NUMBER

  
													



 


 



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