Exhibit 4.01


 


CUSIP
NO. 52517P6R7


ISIN NO. US52517P6R77


 


	
  REGISTERED

  	
  PRINCIPAL
  AMOUNT: $2,411,000

  
	
  No. R-1

  	
   

  



 


LEHMAN BROTHERS HOLDINGS INC.


 


MEDIUM-TERM NOTE, SERIES I


 


RETURN-ENHANCED NOTES LINKED TO A BASKET OF
TEN COMMODITIES
 DUE OCTOBER 11, 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 at Maturity.


 


The “Maturity Date” is October
11, 2010, or if such day is not a Business Day, on the next following Business
Day.


 


The
“Valuation Date” is October 4, 2010, 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.


 


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)                              the sum of $1,000 plus the
product of $1,000 times the Basket Return times the Upside 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 “Commodity
Weightings” are as follows:


 


	
  Component Commodities

  	
   

  	
  Component

  Weighting

  	
   

  
	
  Light sweet
  crude oil (“Crude Oil”)

  	
   

  	
  10.0

  	
  %

  
	
  No. 2 fuel
  heating oil (“Heating Oil”)

  	
   

  	
  10.0

  	
  %

  
	
  Copper — Grade A
  (“Copper”)

  	
   

  	
  10.0

  	
  %

  
	
  Primary Nickel
  (“Nickel”)

  	
   

  	
  10.0

  	
  %

  
	
  Special High
  Grade Zinc (“Zinc”)

  	
   

  	
  10.0

  	
  %

  
	
  Sugar No. 11 (“Sugar”)

  	
   

  	
  10.0

  	
  %

  
	
  Cocoa (“Cocoa”)

  	
   

  	
  10.0

  	
  %

  
	
  Coffee Robusta
  (“Coffee”)

  	
   

  	
  10.0

  	
  %

  
	
  Class III milk
  (“Milk”)

  	
   

  	
  10.0

  	
  %

  
	
  Number 2 wheat
  (“Wheat”)

  	
   

  	
  10.0

  	
  %

  



 


The “Upside Participation Rate”
is 130%.


 


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


 


2





















 


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


 


The “Original Trade Date” is
October 3, 2007.


 


The “Issue Date” is October 11,
2007.


 


The “Weighted Component Commodity
Returns” are, for each Component Commodity, the product of the Component
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 Prices”
for each Component Commodity are as follows:


 


	
  Component

  Commodity

  	
   

  	
  Initial Commodity

  Price

  	
   

  
	
  Crude Oil

  	
   

  	
  US$79.94

  	
   

  
	
  Heating Oil

  	
   

  	
  US$2.1787

  	
   

  
	
  Copper

  	
   

  	
  US$8,301.00

  	
   

  
	
  Nickel

  	
   

  	
  US$31,005.00

  	
   

  
	
  Zinc

  	
   

  	
  US$3,110.00

  	
   

  
	
  Sugar

  	
   

  	
  US$9.84

  	
   

  
	
  Cocoa

  	
   

  	
  US$1,876.00

  	
   

  
	
  Coffee

  	
   

  	
  US$1,934.00

  	
   

  
	
  Milk

  	
   

  	
  US$20.12

  	
   

  
	
  Wheat

  	
   

  	
  US$927

  	
   

  



 


The “Final Commodity Price” is,
for each Component Commodity, the Commodity Price on the Valuation Date.


 


The “Commodity Price” for each
Component Commodity is as follows:


 


	
  Component

  Commodity

  	
   

  	
  Commodity Price

  	
   

  
	
  Crude Oil

  Heating Oil

  	
   

  	
  For each of Crude Oil and Heating Oil, the official
  settlement price of the first nearby month futures contract (or, in the case
  of the last trading day of the first nearby month contract, the second near by
  month contract) for that Component Commodity, expressed (a) in the case of
  Crude Oil, as the U.S. dollar

  	
   

  



 


3

















 


	
   

  	
   

  	
  price per barrel and (b) in the case of Heating Oil,
  as the U.S. dollar price per gallon, in each case as made public by the
  Relevant Exchange for that Component Commodity (subject to the occurrence of
  a Disruption Event).

  	
   

  
	
  Copper

  Nickel

  Zinc

  	
   

  	
  For each of Copper, Nickel and Zinc, the official
  settlement price of that Component Commodity for cash delivery, expressed as
  the U.S. dollar price per metric ton of the Component Commodity, in each case
  as made public by the Relevant Exchange for that Component Commodity (subject
  to the occurrence of a Disruption Event).

  	
   

  
	
  Sugar

  	
   

  	
  The official settlement price of the first nearby
  month futures contract (or, in the case of the last trading day of the first
  nearby month contract, the second nearby month contract) for Sugar, expressed
  as the U.S. cent price per pound, as made public by the Relevant Exchange for
  that Component Commodity (subject to the occurrence of a Disruption Event).

  	
   

  
	
  Cocoa

  	
   

  	
  The official settlement price of the contract with
  the next succeeding “first notice date” (as defined below in “Information on
  the Component Commodities — Information on Sugar, Cocoa and the ICE”),
  expressed as the U.S. dollar price per metric ton, as made public by the
  Relevant

  	
   

  



 


4

















 


	
   

  	
   

  	
  Exchange for that Component Commodity (subject to
  the occurrence of a Disruption Event).

  	
   

  
	
  Coffee

  	
   

  	
  The official settlement price of the contract with
  the next succeeding “first notice date” (as defined below in “Information on
  the Component Commodities— Information on Coffee and the LIFFE Exchange”),
  expressed as the U.S. dollar price per metric ton, as made public by the
  Relevant Exchange for that Component Commodity (subject to the occurrence of
  a Disruption Event).

  	
   

  
	
  Milk

  	
   

  	
  The official settlement price of the contract with
  the next succeeding “last trade date” (as defined below in “Information on
  the Component Commodities— Information on Milk, Wheat and the CME Group”),
  expressed as the U.S. dollar price per hundredweight (100 pounds), as made
  public by the Relevant Exchange for that Component Commodity (subject to the
  occurrence of a Disruption Event).

  	
   

  
	
  Wheat

  	
   

  	
  The official settlement price of the contract with
  the next succeeding “first notice date” (as defined below in “Information on
  the Component Commodities— Information on Milk, Wheat and the CME Group”),
  expressed as the U.S. cents price per bushel, as made public by the Relevant
  Exchange for that

  	
   

  



 


5

















 


	
   

  	
   

  	
  Component Commodity (subject to the occurrence of a
  Disruption Event).

  	
   

  



 


The “Relevant Exchange” is, for
each Component Commodity, the exchange set forth opposite such Component
Commodity below, or its successor, or if the exchange set forth below is no
longer the principal exchange or trading market for a Component Commodity or
options or futures contracts for such Component Commodity, such other exchange
or principal trading market for the relevant Component Commodity as determined
in good faith by the Calculation Agent which serves as the source of prices for
that Component Commodity, and any principal exchanges where options or futures
contracts on that Component Commodity are traded:


 


	
  Component

  Commodity

  	
   

  	
  Relevant Exchange

  	
   

  
	
  Crude Oil

  	
   

  	
  The NYMEX Division, or its successor, of the New
  York Mercantile Exchange, Inc. (“NYMEX”)

  	
   

  
	
  Heating Oil

  	
   

  	
  NYMEX

  	
   

  
	
  Copper

  	
   

  	
  London Metal Exchange (“LME”)

  	
   

  
	
  Nickel

  	
   

  	
  LME

  	
   

  
	
  Zinc

  	
   

  	
  LME

  	
   

  
	
  Sugar

  	
   

  	
  The Intercontinental Exchange (“ICE”)

  	
   

  
	
  Cocoa

  	
   

  	
  ICE

  	
   

  
	
  Coffee

  	
   

  	
  Euronext.liffe (“LIFFE”)

  	
   

  
	
  Milk

  	
   

  	
  CME Group (“CME”) (as successor to The
  Chicago Board of Trade and the Chicago Mercantile Exchange)

  	
   

  
	
  Wheat

  	
   

  	
  CME

  	
   

  



 


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 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


 


6





















 


•                                          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 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, 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);

  
	
   

  	
   

  	
   

  
	
  (D)

  	
   

  	
  the occurrence since the Original Trade Date of a
  material change in the content, composition, or constitution of the Component
  Commodity; or

  
	
   

  	
   

  	
   

  
	
  (E)

  	
   

  	
  the occurrence since the Original 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:


 


7





















 


(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).


 


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.


 


8

















 


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:  October
10, 2007


 


	
  [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

  	
   

  
				



 


9

















 


[REVERSE OF NOTE]


 


LEHMAN BROTHERS HOLDINGS INC.


MEDIUM-TERM NOTES, SERIES I


RETURN-ENHANCED NOTES LINKED TO A BASKET OF
TEN COMMODITIES  
 DUE OCTOBER 11, 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, Return-Enhanced Notes
Linked to a Basket of Ten 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
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 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.


 


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 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
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.