Document:

Exhibit 4.03

CUSIP
NO. 52517P4H1

ISIN NO. US52517P4H14

 

	
  REGISTERED

  	
   

  	
  PRINCIPAL
  AMOUNT: $11,000,000

  
	
  No. R-1

  	
   

  	
   

  

 

 

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

FX BASKET-LINKED NOTE
 DUE SEPTEMBER 28, 2009

 

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 September 28, 2009, 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.

The “Additional Amount” is a single U.S. dollar amount equal to the
principal amount of the Notes multiplied by the product of the Leverage times
greatest of the Basket Returns of (a) Basket 1, (b) Basket 2 and (c) Basket 3; provided that the minimum Additional Amount payable on the
notes shall be zero.

The “Leverage” is 150%.

Basket 1 consists of the Brazilian Real (BRL), Argentine Peso (ARS) and
Mexican Peso (MXN), each with a weighting of 33.34%, 33.33% and 33.33%,
respectively.  Basket 2 consists of Turkish
Lira (TRY), Hungarian Forint (HUF), Israeli Shekel (ILS) and Russian Ruble
(RUB), each with a weighting of 25%. 
Basket 3 consists of Indonesian Rupiah (IDR), Singapore Dollar (SGD),
Malaysian Ringgit (MYR) and Indian Rupee (INR), each with a weighting of
25%.  Each such currency is a “Reference
Currency.”

The “Basket Return” for each Basketn equals
the sum of the Weighted Currency Returns for the Reference Currencies in that
Basketn.

The “Weighted
Currency Return” for each Reference Currency in each Basketn is the
product of the Weighting for such Reference Currency times a quotient, the
numerator of which is the difference of the Initial Reference Currency Rate for
such Reference Currency minus the Settlement Rate for such Reference Currency
and the denominator of which is the Settlement Rate for such Reference
Currency.

The “Initial
Reference Currency Rate” and “Weighting” for each Reference Currency in each
Basketn are as follows:

	
  Basketn

  	
   

  	
  Reference

  Currency

  	
   

  	
  Initial

  Reference

  Currency

  Rate

  	
   

  	
  Weighting

  	
   

  
	
  Basket 1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BRL

  	
   

  	
  1.8656

  	
   

  	
  33.34%

  	
   

  
	
   

  	
   

  	
  ARS

  	
   

  	
  3.1700

  	
   

  	
  33.33%

  	
   

  
	
   

  	
   

  	
  MXN

  	
   

  	
  10.9517

  	
   

  	
  33.33%

  	
   

  
	
  Basket 2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TRY

  	
   

  	
  1.2339

  	
   

  	
  25%

  	
   

  
	
   

  	
   

  	
  HUF

  	
   

  	
  177.68

  	
   

  	
  25%

  	
   

  
	
   

  	
   

  	
  ILS

  	
   

  	
  4.0297

  	
   

  	
  25%

  	
   

  
	
   

  	
   

  	
  RUB

  	
   

  	
  25.0275

  	
   

  	
  25%

  	
   

  

 

2

 

	
  Basket 3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  IDR

  	
   

  	
  9163

  	
   

  	
  25%

  	
   

  
	
   

  	
   

  	
  SGD

  	
   

  	
  1.5007

  	
   

  	
  25%

  	
   

  
	
   

  	
   

  	
  MYR

  	
   

  	
  3.4333

  	
   

  	
  25%

  	
   

  
	
   

  	
   

  	
  INR

  	
   

  	
  39.81

  	
   

  	
  25%

  	
   

  

The “Settlement
Rate” for each Reference Currency is the Reference Exchange Rate on the
Valuation Date, determined in accordance with the applicable Settlement Rate
Option (subject to the occurrence of a Disruption Event).

The “Reference Exchange Rates” are the spot exchange rates
for each of the Reference Currencies quoted against the U.S. dollar expressed
as number of currency units per USD 1.

The “Valuation Date” is September 22, 2009; provided
that, upon the occurrence of a Disruption Event with respect to a Reference
Currency, the Valuation Date for the affected Reference Currency may be
postponed (as described in “Disruption Events” below).

The “Issue Date” is September 28, 2007.

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

•                                            for each Reference Currency that did not suffer a Disruption Event on
the scheduled Valuation Date, the Settlement Rate on the scheduled Valuation
Date, and

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

provided, however, that if a Disruption Event has occurred or is continuing
with respect to a Reference 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 Reference Currency; and (b) the Calculation Agent will determine the
Settlement Rate for the affected Reference 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 Reference Currency.

A “Disruption Event” means any of the following events
as determined in good faith by the Calculation Agent:

 

3

 

(A)                              the occurrence and/or existence of
an event on any day that has the effect of preventing or making impossible the
delivery of USD from accounts inside the country for which a Reference Currency
is the lawful currency (such jurisdiction with respect to such Reference
Currency, the “Reference Currency Jurisdiction”) for that Reference Currency to
accounts outside that Reference Currency Jurisdiction;

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

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

A “Valuation
Business Day” means, with respect to each Reference 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:

	
  Reference

  Currency

  	
   

  	
  Screen

  Reference

  	
   

  	
  Valuation

  Business Day

  	
   

  
	
  BRL

  	
   

  	
  BRFR

  	
   

  	
  Brazilia, Rio de

  Janiero or São

  Paulo; and New York

  	
   

  
	
  ARS

  	
   

  	
  ARS=BNAR

  	
   

  	
  Buenos Aires and New York

  	
   

  
	
  MXN

  	
   

  	
  MEX01

  	
   

  	
  Mexico City and New
  York

  	
   

  
	
  TRY

  	
   

  	
  The EUR/TRY rate on
  ECB37 divided by the EUR/USD rate on ECB37

  	
   

  	
  TARGET and New York

  	
   

  
	
  HUF

  	
   

  	
  The EUR/HUF rate on
  ECB37 divided by the EUR/USD rate on ECB37

  	
   

  	
  TARGET and New York

  	
   

  
	
  ILS

  	
   

  	
  FXIL

  	
   

  	
  Tel Aviv and New York

  	
   

  

 

4

 

	
  RUB

  	
   

  	
  EMTA

  	
   

  	
  Moscow and New York

  	
   

  
	
  IDR

  	
   

  	
  ABSIRFIX01

  	
   

  	
  Singapore and New York

  	
   

  
	
  SGD

  	
   

  	
  ABSIRFIX01

  	
   

  	
  Singapore and New York

  	
   

  
	
  MYR

  	
   

  	
  ABSIRFIX01

  	
   

  	
  Singapore and New York

  	
   

  
	
  INR

  	
   

  	
  RBIB

  	
   

  	
  Mumbai and New York

  	
   

  

The “Settlement
Rate Option” 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 Valuation
Date or such other relevant date.  The Settlement Rate Option for 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=BNAR page at the close of business in Buenos
Aires on the Valuation Date or such other relevant date.  The Settlement
Rate Option for the MXN Reference Exchange Rate 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 Valuation Date or such other relevant date.

The Settlement Rate Option for the TRY is the
TRY/EUR Fixing Rate divided by the USD/EUR Fixing Rate.  The Settlement Rate Option for the TRY is the
EUR/TRY Fixing Rate divided by the EUR/USD Fixing Rate.  The “EUR/TRY Fixing Rate” is the Euro/Turkish
Lira fixing rate, expressed as the amount of Euro per one Turkish Lira which
appears on Reuters Screen ECB37 to the right of the caption “TRY” at
approximately 2:15 p.m., Central European time, on the Valuation Date or such
other relevant date.  The “EUR/USD Fixing
Rate” is the Euro/U.S. dollar fixing rate, expressed as the amount of Euro per
one U.S. dollar which appears on Reuters Screen ECB37 to the right of the
caption “USD” at approximately 2:15 p.m., Central European time, on the Valuation
Date or such other relevant date.  The
Settlement Rate Option for the HUF is the EUR/HUF Fixing Rate divided by the
EUR/USD Fixing Rate.  The “EUR/HUF Fixing
Rate” is the Euro/Hungarian Forint fixing rate, expressed as the amount of Euro
per one Hungarian Forint which appears on Reuters Screen ECB37 to the right of
the caption “HUF” at approximately 2:15 p.m., Central European time, on the
Valuation Date or such other relevant date. 
The Settlement Rate Option for the ILS is the Israeli Shekel/U.S. dollar
Specified Rate, expressed as the amount of Israeli Shekels per one U.S. dollar,
for settlement in two Business Days which appears on the Reuters Screen FXIL
under the heading “USD/ILS” to the right of the caption “1700” at approximately
5.00 p.m., Tel Aviv time, on Valuation Date or such other relevant date.  The Settlement Rate
Option for the RUB is the Russian Ruble/U.S. dollar Specified Rate, expressed
as the amount of Russian Rubles per one U.S. dollar, for

5

settlement in one Business Day, calculated by the Chicago Mercantile
Exchange (“CME”) and as published on CME’s website, which appears on the
Reuters Screen EMTA Page, at approximately 1:30 p.m., Moscow time, on the
Valuation Date or such other relevant date.

The Settlement Rate Option for the IDR is the
Indonesian Rupiah/U.S. dollar spot rate at 11:00 a.m., Singapore time,
expressed as the amount of Indonesian Rupiah per one U.S. dollar, for
settlement in two Business Days reported by the Association of Banks in
Singapore which appears on the Reuters Page ABSIRFIX01 to the right of the
caption “Spot” under the column “IDR” at approximately 11:30 a.m., Singapore
time, on the on the Valuation Date or such other relevant date.  The Settlement Rate Option for the SGD is the
Singapore Dollar/U.S. dollar spot rate at 11:00 a.m., Singapore time, expressed
as the amount of Singapore Dollar per one U.S. dollar, for settlement in two
Business Days, reported by the Association of Banks in Singapore which appears
on the Reuters Page ABSIRFIX01 to the right of the caption “Spot” under the
column “SGD” at approximately 11:30 a.m., Singapore time, on the Valuation Date
or such other relevant date.  The
Settlement Rate Option for the MYR is the Malaysian Ringgit/U.S. dollar spot
rate, expressed as the amount of Malaysian Ringgit per one U.S. dollar, for
settlement in two Business Days reported by the Association of Banks in
Singapore, which appears on the Reuters Page ABSIRFIX01 to the right of the
caption “Spot” under the column “MYR” at approximately 11:30 a.m. Singapore
time on the Valuation Date or such other relevant date.  The Settlement Rate Option 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 on the Valuation
Date or such other relevant date.

The term “Business Day” solely as used in any
Settlement Rate Option 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 Reference Currency and (b) the currency against which the
Reference 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 Reference Currency or base currency in the
table below; provided that where the Turkish Lira or Hungarian Forint is the
Reference Currency or the base currency “business day” for the Turkish Lira or
Hungarian Forint as the Reference Currency or the base currency shall mean any
day on which the Trans-European Automated Real-Time Gross Settlement Express
Transfer (TARGET) System is open.

The
screen or time of observation indicated in relation to any Settlement Rate
Option 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, Settlement Rate or other rate, as specified in the
applicable pricing supplement, in respect of a reference 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, Settlement Rate or other rate for such
Reference Currency will be

 

6

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
reference 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, Settlement 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 Reference 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, Settlement Rate or other rate, as applicable, for such Reference
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.

 

7

 

                                                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:  September 28, 2007

 

	
  [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

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
						

 

8

 

 

 

 

[REVERSE
OF NOTE]

 

 

LEHMAN BROTHERS
HOLDINGS INC.

MEDIUM-TERM NOTES,
SERIES I

FX BASKET-LINKED NOTE
 DUE SEPTEMBER 28, 2009

 

                                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, FX Basket-Linked Note (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.Exhibit 4.04

 

	
  CUSIP
  NO. 52517P6G1

  	
   

  	
   

  
	
  ISIN NO. US52517P6G13

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  REGISTERED

  	
   

  	
  PRINCIPAL AMOUNT:
  $2,351,000

  
	
  No. R-1

  	
   

  	
   

  

 

 

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

THREE-YEAR NOTES LINKED TO THE LBCI EQUAL
WEIGHT EXCESS RETURN
 DUE SEPTEMBER 28, 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 September 28, 2010, or if such day is not a Business Day, on
the next following Business Day; provided that,
if as a result of a Market Disruption Event the Valuation Date for one or more
Index Contracts is postponed so that it falls less than three Business Days
prior to the scheduled Maturity Date, the Maturity Date will be the third
Business Day following the latest occurring postponed Valuation Date.

The “Valuation
Date” is September 22, 2010, or if such day is not an Index Business Day, the
immediately preceding Index Business Day; provided that if a Market Disruption
Event is in effect for one or more Index Contracts on the scheduled Valuation
Date, the Valuation Date may be postponed as described below.

The “Redemption Amount” for each note will be a single U.S.
dollar payment on the Maturity Date equal to the product of the principal
amount of the notes times the Adjusted Performance Factor.

The Adjusted Performance Factor is equal to:

(A)  the sum of 100%
plus the product of the Participation Rate times the difference of the Index
Performance minus 1, if the Final Index Value is greater than the Initial Index
Value;

(B)  100%, if the
Final Index Value is less than or equal to the Initial Index Value but greater
than or equal to the Buffer Level; or

(C)  the sum of 20%
plus the Index Performance, if the Final Index Value is less than the Buffer
Level.

The “Index Performance” is equal to the quotient of the
Final Index Value divided by the Initial Index Value.

The “Participation Rate” is 120%.

The “Buffer Level” is 85.3806, equal to the product of the
Initial Index Value times 80%.

The “Initial Index Value” is 106.7258, equal to the closing value of
the Index on the Trade Date, as determined and published by the Index Sponsor,
rounded to four decimal places.

The “Trade Date” is the September 25, 2007.

The “Issue Date” is the September 28, 2007.

 

2

 

The “Final Index Value” will be the closing value of the Index on the
Valuation Date, as determined and published by the Index Sponsor (subject to
the occurrence of a Market Disruption Event or an Index Unavailability Event),
rounded to four decimal places.

An “Index Business Day” is a day, as determined in good faith by the
Calculation Agent, on which trading is generally conducted on the Relevant
Exchange for each Index Contract then comprising the Index or any Successor
Index.

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 “Index” is the Lehman Brothers Commodity Index Equal Weight Excess
Return calculated and published by the Index Sponsor, subject to adjustment, as
described below.

The “Index Sponsor” is Lehman Brothers Inc.

The “Index Contracts” means the commodities contracts underlying the
Index or any Successor Index.

The “Relevant Exchange” means any organized exchange or market of
trading for any futures contract (or any combination thereof) included in the
Index or any Successor Index.

If a Market Disruption Event relating to one or more Index
Contracts is in effect on the scheduled Valuation Date, the Calculation Agent
will calculate the Final Index Value in good faith in accordance with the
formula for and method of calculating the Index last in effect prior to
commencement of the Market Disruption Event, using:

•    for each Index Contract that
did not suffer a Market Disruption Event on the scheduled Valuation Date, the
settlement price on the applicable Relevant Exchange of such Index Contract on
the scheduled Valuation Date, and

•    for each Index Contract that
did suffer a Market Disruption Event on the scheduled Valuation Date, the
settlement price of such Index Contract on the applicable Relevant Exchange on
the immediately succeeding trading day on which no Market Disruption Event
occurs or is continuing  with respect to
such Index Contract;

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

A “Market Disruption Event” means any of the following
events as determined in good faith by the Calculation Agent:

 

3

 

(A)                              the termination or
suspension of, or material limitation or disruption in the trading on a
Relevant Exchange of any Index Contract;

(B)                                the settlement price
on a Relevant Exchange of any Index Contract has increased or decreased by an
amount equal to the maximum permitted price change from the previous day’s
settlement price; or

(C)                                the settlement price of any Index Contract is not published by the
Relevant Exchange.

Notwithstanding the foregoing, the following events will
not constitute Market Disruption Events:

(1)                                  a
limitation on the hours in a trading day and/or number of days of trading, if
it results from an announced change in the regular business hours of the
Relevant Exchange; or

(2)                                  a
decision to permanently discontinue trading in the Index Contract or options or
futures contracts relating to the Index or the Index Contract.

If an Index Unavailability Event is in effect on the
scheduled Valuation Date (and no Market Disruption Event is then in effect),
the Calculation Agent will determine the Final Index Value on the Valuation
Date 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
Event using the closing price on the Relevant Exchanges of each Index Contract.

An “Index Unavailability Event” means that the Index is not
calculated by the Index Sponsor or any Successor Index is not calculated and
published by the sponsors thereof.

If Lehman Brothers Inc. discontinues
publication of the Index and Lehman Brothers Inc. or another entity publishes a
successor or substitute index that the Calculation Agent determines, in its
sole discretion, to be comparable to the discontinued Index (such index, a “Successor
Index”), then the Final Index Value will be determined by reference to the
level of such Successor Index at the close of trading on the Relevant Exchange
or market of the Successor Index last to close on the Valuation Date; provided,
however, that the Calculation Agent, in its sole discretion, may make such
adjustments as it deems necessary 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 Company and to the Holders of the notes.

If Lehman Brothers Inc. discontinues
publication of the Index prior to, and such discontinuation is continuing on,
the Valuation Date, and the Calculation Agent determines, in its sole
discretion, that no Successor Index is available at such time, then the
Calculation Agent will determine the Final Index Value on the Valuation
Date.  The Final Index Value 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, using the
settlement prices on the Relevant Exchanges of the Index Contracts (or, if
trading in the relevant futures contracts has been materially

 

4

 

suspended or materially limited, its good faith estimate of the closing
price that would have prevailed but for such suspension or limitation) at the
close of trading on the Valuation Date.

If at any time the method of calculating the
Index or a Successor Index, or the level thereof, is, in the good faith
judgment of the Calculation Agent, changed or modified in a material respect,
the Calculation Agent may (but is not obligated to) make such adjustments to
the Index or Successor Index or their respective methods of calculation as, in
the good faith judgment of the Calculation Agent, may be necessary in order to
arrive at a level of a commodity index comparable to the Index or such
Successor Index, as the case may be, as if such changes or modifications had
not been made, and the Calculation Agent will calculate the Final Index Value
with reference to the Index or such Successor Index as adjusted.  Accordingly, if the method of calculating the
Index or a Successor Index is modified or rebased so that the level of the
Index or Successor Index is a fraction or multiple of what it would have been
if it had not been modified or rebased, then the Calculation Agent will adjust
the level of the Index or Successor Index in order to arrive at a level of the
Index or Successor Index as if it has not been modified or rebased.

The “Calculation Agent” means Lehman Brothers
Inc., the determinations and calculations of which will be binding in absence
of 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.

 

5

 

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:  September 28, 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

  	
   

  
	
   

  	
   

  

 

 

6

 

 

[REVERSE
OF NOTE]

 

 

LEHMAN BROTHERS
HOLDINGS INC.

MEDIUM-TERM NOTES,
SERIES I

THREE-YEAR NOTES LINKED TO THE LBCI EQUAL
WEIGHT EXCESS RETURN  
 DUE 
JULY 13, 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, Three-Year Notes Linked to the LBCI Equal
Weight Excess Return (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 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 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 $10,000 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 the
Company, 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 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.

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