By Angela McDaniels
Tacoma, Wash., Dec. 24 - Lehman Brothers Holdings Inc. priced $50 million of 2% synthetic convertible notes due Dec. 31, 2012 linked to the common stock of Nestle SA, according to an FWP filing with the Securities and Exchange Commission.
Interest is payable semiannually.
The notes are convertible at any time for the cash value in dollars of 1.8897 Nestle shares - 1.8897 equals $1,000 divided by CHF 610.8825, the conversion price - calculated using the then-current dollar/Swiss franc exchange rate. The conversion price is 17.5% higher than the stock's share price on the pricing date, which was CHF 519.90, and was determined using the dollar/Swiss franc exchange rate on that date, which was 1.544 Swiss francs per dollar.
The payout at maturity will be the greater of par in cash or the cash value of 1.8897 Nestle shares, determined using the then-current dollar/Swiss franc exchange ratio.
The notes will be callable beginning Dec. 21, 2009. The redemption amount will be calculated in the same manner as the payout at maturity.
Lehman Brothers Inc. is the underwriter.
| Issuer: | Lehman Brothers Holdings Inc.
|
| Issue: | Synthetic convertible notes
|
| Underlying stock: | Nestle SA (VTX: NESN)
|
| Amount: | $50 million
|
| Maturity: | Dec. 31, 2012
|
| Coupon: | 2%, payable semiannually
|
| Price: | Par
|
| Payout at maturity: | Greater of par or the cash value of 1.8897 Nestle shares, calculated using the dollar/Swiss franc exchange ratio at that time
|
| Initial share price: | CHF 519.90
|
| Conversion price: | CHF 610.8825, 117.5% of initial share price
|
| Conversion ratio: | At any time for cash value of 1.8897 Nestle shares, calculated using the dollar/Swiss franc exchange ratio at that time
|
| Initial exchange rate: | 1.1544 Swiss francs per dollar
|
| Call: | From Dec. 21, 2009 onward
|
| Pricing date: | Dec. 21
|
| Settlement date: | Dec. 31
|
| Underwriter: | Lehman Brothers Inc.
|
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