EXHIBIT 1.09
LEHMAN BROTHERS HOLDINGS INC.
NASDAQ-100 INDEX(R) SUNSSM
109% Minimum Redemption Stock Upside Note SecuritiesSM Due April 26, 2004
Number R-1 $30,000,000
CUSIP 524908 DC 1
See Reverse for Certain Definitions
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE THEREOF. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN CERTIFICATED FORM, THIS 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 SUCH 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. UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TO LEHMAN BROTHERS HOLDINGS INC. OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS
REGISTERED IN THE NAME OF CEDE AND CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY (AND ANY PAYMENT IS MADE TO CEDE AND
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
AND CO., HAS AN INTEREST HEREIN.
LEHMAN BROTHERS HOLDINGS INC., a corporation duly organized and
existing under the laws of the State of Delaware (hereinafter called the
"Company"), for value received, HEREBY PROMISES TO PAY to CEDE AND CO. or
registered assigns, at the office or agency of the Company in the Borough of
Manhattan, The City of New York, on April 26, 2004, or if a Market Disruption
Event occurs, five Business Days after the Payment Determination Date (the
"Stated Maturity"), in such coin or currency of the United States of America at
the time of payment shall be legal tender for the payment of public and private
debts, for each $1,000 principal amount of the Securities represented hereby, an
amount equal to the greater of (a) $1,090 and (b) the Alternative Redemption
Amount (the "Maturity Payment Amount").
Any amount payable at Stated Maturity hereon will be paid only upon
presentation and surrender of this Security.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS SECURITY SET
FORTH ON THE REVERSE HEREOF WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE
THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
"Nasdaq-100", "Nasdaq-100 Index", and "Nasdaq" are trade or service
marks of The Nasdaq Stock Market, Inc. (together with its affiliates, the
"Nasdaq Corporations") and are licensed for use by the Company. This Security
has not been passed on by the Nasdaq Corporations as to its legality or
suitability. This Security is not issued, endorsed, sold, or promoted by the
Nasdaq Corporations. THE NASDAQ CORPORATIONS MAKE NO WARRANTIES AND BEAR NO
LIABILITY WITH RESPECT TO THIS SECURITY.
"SUNSSM" and "Stock Upside Note SecuritiesSM" are service marks of
Lehman Brothers Inc.
This Security 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 referred to on the reverse hereof.
IN WITNESS WHEREOF, LEHMAN BROTHERS HOLDINGS INC. has caused this
instrument to be signed by its Chairman of the Board, its Vice Chairman, its
President, 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: April 26, 2001 LEHMAN BROTHERS HOLDINGS INC.
By:
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Name: Oliver Budde
Title: Vice President
Attest:
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Name: Madeline L. Shapiro
Title: Assistant Secretary
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Dated: April 26, 2001
CITIBANK, N.A.
as Trustee
By:
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Name:
Title: Authorized Signatory
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(Reverse of Security)
This Security is one of a duly authorized series of Securities of the
Company designated as NASDAQ-100 INDEX(R) SUNSSM, 109% Minimum Redemption Stock
Upside Note SecuritiesSM Due April 26, 2004 (herein called the "Securities").
The Company may, without the consent of the holders of the Securities, create
and issue additional notes ranking equally with the Securities and otherwise
similar in all respects so that such further notes shall be consolidated and
form a single series with the Securities; provided that no additional notes can
be issued if an Event of Default has occurred with respect to the Securities.
This series of Securities is one of an indefinite number of series of debt
securities of the Company, issued and to be issued under an indenture, dated as
of September 1, 1987, as amended (herein called the "Indenture"), duly executed
and delivered by the Company and Citibank N.A., as trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture), 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 Company, the Trustee and the Holders of the
Securities.
The Alternative Redemption Amount shall be determined by the
Calculation Agent pursuant to the Calculation Agency Agreement.
All percentages resulting from any calculation with respect to the
Securities will be rounded at the Calculation Agent's discretion.
The Trustee shall fully rely on the determination by the Calculation
Agent of the Maturity Payment Amount and shall have no duty to make any such
determination.
This Security is not subject to any sinking fund and is not redeemable
prior to its Stated Maturity.
If an Event of Default with respect to the Securities shall occur and
be continuing, the amounts payable on all of the Securities may be declared due
and payable in the manner and with the effect provided in the Indenture. The
amount payable to the Holder hereof upon any acceleration permitted under the
Indenture will be equal to the Maturity Payment Amount calculated as though the
date of acceleration was the Stated Maturity and the date five Business Days
prior thereto was the Payment Determination Date.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than 66-?% in aggregate
principal amount of each series of Securities at the time Outstanding to be
affected (each series voting as a class), 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 principal amount thereof, or reduce the rate or
extend the time of payment of interest thereon or reduce any premium payable on
redemption, or make the principal
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thereof, or premium, if any, or interest therein payable in any coin or
currency other than that hereinabove 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 or the principal of, 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 Security shall be conclusive and binding upon
such Holder and upon all future holders and owners of this Security and any
Securities which may be issued in exchange or substitution hereof, irrespective
of whether or not any notation thereof is made upon this Security or such other
Securities.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal amount with respect to this
Security.
The Securities are issuable in denominations of $1,000 and any integral
multiples of $1,000.
The Company, the Trustee, and any agent of the Company or of the
Trustee may deem and treat the registered holder (the "Holder") hereof as the
absolute owner of this Security (whether or not this Security shall be overdue
and notwithstanding any notation of ownership or other writing hereon), for the
purpose of receiving payment hereof, or on account hereof, and for all other
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. All such
payments made to or upon the order of such registered holder shall, to the
extent of the sum or sums paid, effectually satisfy and discharge liability for
moneys payable on this Security.
No recourse for the payment of the principal of, premium, if any, or
interest on this Security, 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
Security, 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.
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As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
Corporate Trust Office or agency in a Place of Payment for this Security, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed by, the
Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Securities of this series or of like tenor and of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Set forth below are definitions of the terms used in this Security.
"AMEX" shall mean the American Stock Exchange.
"Alternative Redemption Amount" shall mean, with respect to each $1,000
principal amount of Securities, the sum of (i) $1,000 and (ii) the Equity
Return.
"Business Day", notwithstanding any provision in the Indenture, shall
mean any day that is not a Saturday, a Sunday or a day on which the NYSE or
Nasdaq is not open for trading or banking institutions or trust companies in the
City of New York are authorized or obligated by law or executive order to close.
"Calculation Agency Agreement" shall mean the Calculation Agency
Agreement, dated as of April 26, 2001, between the Company and the Calculation
Agent, as amended from time to time.
"Calculation Agent" shall mean the person that has entered into an
agreement with the Company providing for, among other things, the determination
of the Maturity Payment Amount, which term shall, unless the context otherwise
requires, include its successors and assigns. The initial Calculation Agent
shall be Lehman Brothers Inc.
"Capped Quarterly Return" for any Reset Period shall mean the lesser
of:
(x) ending index level - starting index level; and
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starting index level
(y) 9%,
where (i) the starting index level for the first Reset Period equals
1953.28 and the starting index level on any Reset Date equals the
ending index level for the Reset Period ending on that Reset Date and
(ii) the ending index level for any Reset Period is the Closing Level
on the Reset Date at the end of that Reset Period or, in the case
of the last Reset Period, on the fifth Business Day prior to the
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Stated Maturity
"Close of Trading" shall mean 4:00 p.m., New York City time.
"Closing Level" shall mean the last reported level of the Index or the
Successor Index, as the case may be, at 4:00 p.m., New York City time, as
reported by Nasdaq or the publisher of the Successor Index, as the case may be.
"Equity Return" shall mean the product of (i) $1,000 and (ii) the sum
of the Capped Quarterly Returns for twelve Reset Periods.
"Index" shall mean the Nasdaq-100 Index(R), as calculated by Nasdaq.
"Market Disruption Event", on any day, shall mean any of the following
events as determined by the Calculation Agent:
(i) A suspension, absence or material limitation of trading in
20% of more of the underlying stocks which then comprise the Index or
any Successor Index, as the case may be, has occurred on that day, in
each case, for more than two hours of trading or during the one-half
hour period preceding the Close of Trading on the primary organized
U.S. exchange or trading system on which such stocks are traded or, in
the case of a common stock not listed or quoted in the United States,
on the primary exchange, trading system or market for that security.
Limitations on trading during significant market fluctuations imposed
pursuant to the rules of any primary organized U.S. exchange or trading
system similar to NYSE Rule 80B (or any applicable rule or regulation
enacted or promulgated by the NYSE, any other exchange, trading system,
or market, any other self regulatory organization or the Securities and
Exchange Commission of similar scope as determined by the Calculation
Agent), may be considered material. Notwithstanding the first sentence
of this paragraph, a Market Disruption Event for a security traded on a
bulletin board means a suspension, absence or material limitation of
trading of that security for more than two hours or during the one hour
period preceding 4:00 p.m., New York City time.
(ii) A suspension, absence or material limitation has occurred
on that day, in each case, for more than two hours of trading or during
the one-half hour period preceding the Close of Trading in options
contracts related to the Index or any Successor Index, as the case may
be, whether by reason of movements in price exceeding levels permitted
by an exchange, trading system or market on which such options
contracts are traded or otherwise.
(iii) Information is unavailable on that date, through a
recognized system of public dissemination of transaction information,
for more than two hours of trading or during the one-half hour period
preceding the Close of Trading, of accurate price, volume or related
information in respect of 20% or more of the underlying stocks which
then comprise the Index or any Successor Index, as the case may be, or
in respect of options contracts related to the Index or
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any Successor Index, as the case may be, in each case traded on any
major U.S. exchange or trading system or in the case of securities of
a non-U.S. issuer, traded on the primary non-U.S. exchange, trading
system or market.
For purposes of determining whether a Market Disruption Event has
occurred:
(i) a limitation on the hours or number of days of trading
shall not constitute a Market Disruption Event if it results from an
announced change in the regular business hours of the relevant
exchange, trading system or market;
(ii) any suspension in trading in an options contract on the
Index or any Successor Index, as the case may be, by a major securities
exchange, trading system or market by reason of (a) a price change
violating limits set by such securities market, (b) an imbalance of
orders relating to those contracts, or (c) a disparity in bid and ask
quotes relating to those contracts, shall constitute a Market
Disruption Event notwithstanding that the suspension or material
limitation is less than two hours;
(iii) a suspension or material limitation on an exchange,
trading system or in a market shall include a suspension or material
limitation of trading by one class of investors provided that the
suspension continues for more than two hours of trading or during the
last one-half hour period preceding the Close of Trading on the
relevant exchange, trading system or market but shall not include any
time when the relevant exchange, trading system or market is closed for
trading as part of that exchange's, trading system's or market's
regularly scheduled business hours; and
(iv) "Trading systems" include bulletin board services.
"Nasdaq" shall mean The Nasdaq Stock Market, Inc.
"NYSE" shall mean the New York Stock Exchange.
"Payment Determination Date" shall mean the fifth Business Day prior to
the Stated Maturity.
"Reset Dates" shall mean January 19, April 19, July 19 and October 19
of each year, beginning July 19, 2001, or if any such day is not a Business Day,
the next Business Day.
"Reset Periods" shall mean the periods (i) from and including April 19,
2001 to and including the first Reset Date, (ii) from and including one Reset
Date to and including the next succeeding Reset Date and (iii) from and
including the last Reset Date to and including the fifth Business Day prior to
the Stated Maturity.
"Stated Maturity" shall mean April 26, 2004, or (i) if April 26, 2004
is not a Business Day, the next Business Day, or (ii) if a Market Disruption
Event occurs on
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April 26, 2004, the first Business Day after April 26, 2004 on which a Market
Disruption Event does not occur.
"Successor Index" shall mean such substitute index as the Calculation
Agent may select pursuant to the Calculation Agency Agreement upon
discontinuance of the Index.
All terms used but not defined in this Security are used herein as
defined in the Indenture.
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The following abbreviations, when used in the inscription on
the face of the within Security, shall be construed as though they were written
out in full according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - ________ Custodian ________
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts to Minors
JT TEN -as joint tenants with right of Act _________________________
Survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above list.
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FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
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(Name and Address of Assignee, including zip code, must be printed or
typewritten.)
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the within Security, and all rights thereunder, hereby irrevocably constituting
and appointing
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to transfer the said Security on the books of the Company, with full power of
substitution in the premises.
Dated:
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NOTICE: The signature to this assignment must correspond with the name
as it appears upon the face of the within Security in every particular, without
alteration or enlargement or any change whatever.
Signature(s) Guaranteed:
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THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED MEDALLION SIGNATURE GUARANTEE PROGRAM), PURSUANT TO
S.E.C. RULE 17Ad-15.
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