New Issue: Lehman sells $397,000 13.25% reverse exchangeables linked to AMR

By E. Janene Geiss

Philadelphia, April 26 - Lehman Brothers Holdings Inc. priced a $397,000 issue of 13.25% reverse exchangeable notes due April 27, 2008 linked to the common stock of AMR Corp., according to a 424B2 filing with the Securities and Exchange Commission.

Interest will be payable monthly.

Payout at maturity will be par unless AMR stock falls below the knock-in price of $19.40 - 70% of the initial share price - during the life of the notes and finishes below its initial share price of $27.72, in which case the payout will be a number of AMR shares equal to $1,000 divided by the initial share price.

Lehman Brothers Inc. is the underwriter.

Issuer:	Lehman Brothers Holdings Inc.
Issue:	Reverse exchangeable notes
Underlying stock:	AMR Corp.
Amount:	$397,000
Maturity:	April 27, 2008
Coupon:	13.25%, payable monthly
Price:	Par
Payout at maturity:	Par unless AMR stock falls below the knock-in price of $19.40 during the life of the notes and finishes below its initial share price, in which case payout will be 36.075 AMR shares
Initial share price:	$27.72
Knock-in price:	$19.40, 70% of $27.72
Pricing date:	April 24
Settlement date:	April 27
Underwriter:	Lehman Brothers Inc.
Underwriting discount:	3%

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