New Issue: Lehman prices $26.8 million 20% Yeelds linked to United Technologies

By Laura Lutz

Washington, March 7 - Lehman Brothers Holdings Inc. priced a $26,798,922 issue of notes due Aug. 15, 2007 structured as Yield Enhanced Equity Linked Debt Securities (Yeelds) linked to United Technologies Corp. stock, according to a 424B5 filing with the Securities and Exchange Commission.

The five-month notes will pay 8.33% for an annualized rate of 20%. Interest is payable quarterly.

At maturity, investors will receive the value of one share of United Technologies stock, capped at the initial value of $62.55 that Lehman paid to hedge the transaction. The payout will be payable in stock or cash.

Lehman Brothers Inc., the underwriter, has a greenshoe for up to $4,019,838.30 of additional securities.

Issuer:	Lehman Brothers Holdings Inc.
Issue:	Yeelds (Yield Enhanced Equity-Linked Debt Securities) medium-term senior notes, series I
Underlying stock:	United Technologies Corp.
Amount:	$26,798,922
Greenshoe:	$4,019,838.30
Maturity:	Aug. 15, 2007
Coupon:	20%, payable quarterly
Price:	Par of $62.55
Payout at maturity:	Value of one share of United Technologies stock, capped at $62.55, payable in stock or cash
Cap price:	$62.55, 100% of initial value
Pricing date:	March 6
Settlement date:	March 9
Underwriter:	Lehman Brothers Inc.
Underwriting discount:	None

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