Lehman to price Yeelds linked to Financial Select Sector SPDR fund

By Angela McDaniels

Tacoma, Wash., March 31 - Lehman Brothers Holdings Inc. plans to price Yield Enhanced Equity Linked Debt Securities (Yeelds) due April 16, 2009 linked to shares of the Financial Select Sector SPDR fund, according to a 424B2 filing with the Securities and Exchange Commission.

The payout at maturity will be a fixed percentage plus the lesser of 110% of par and the conversion value. The fixed percentage is expected to be 7% to 10% and will be determined at pricing, and the conversion value will be the cash value of a number of fund shares equal to $1,000 divided by the initial share price.

The company noted that if the shares remain above 80% of their initial value throughout the life of the notes and the conversion value is less than par, the payout will be par plus the fixed percentage.

The notes will price on April 7 and settle on April 14.

Lehman Brothers Inc. will be the underwriter.

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