Registration Statement No. 333-


                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549


                                   FORM S-8
                            REGISTRATION STATEMENT
                                     UNDER
                          THE SECURITIES ACT OF 1933


                         LEHMAN BROTHERS HOLDINGS INC.
            (Exact Name of Registrant as Specified in Its Charter)

                 Delaware                           13-3216325
    (State or other jurisdiction of              (I.R.S. employer
     incorporation or organization)           identification number)

                              745 Seventh Avenue
                           New York, New York 10019
                   (Address of principal executive offices)


        1999 NEUBERGER BERMAN INC. LONG-TERM INCENTIVE PLAN, AS AMENDED
                           (Full title of the plan)


                             Thomas A. Russo, Esq.
                              745 Seventh Avenue
                           New York, New York 10019
                    (Name and address of agent for service)


                                (212) 526-7000
         (Telephone number, including area code, of agent for service)


                                   Copy to:
                           Jeffrey A. Welikson, Esq.
                         Lehman Brothers Holdings Inc.
                          399 Park Avenue, 11th Floor
                           New York, New York 10022




<PAGE>
                                                                             2


                        CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>

Title of Securities to be Registered                      Amount to       Proposed Maximum    Proposed Maximum      Amount of
                                                      be Registered (1)  Offering Price per  Aggregate Offering  Registration Fee
                                                                              Unit (2)           Price (2)
<S>                                                   <C>                  <C>                <C>                 <C>

Common Stock, $.10 par value                              2,923,469           $70.67            $206,601,554.23       $16,714.07


                                                          3,021,173           $95.77            $289,337,738.21       $23,407.42

Total                                                     5,944,642           $166.44           $495,939,292.44       $40,121.49(3)
</TABLE>


(1) This Registration Statement registers the issuance of 5,944,642 shares of
common stock of Lehman Brothers Holdings Inc. (the "Registrant"), par value
$0.10 (the "Common Stock"). Such number of shares represents the aggregate
number of shares issuable pursuant to the 1999 Neuberger Berman Inc. Long-Term
Incentive Plan, as amended, as follows: (A) 2,923,469 shares available for
issuance pursuant to future share and/or stock option awards, and (B) 3,021,173
shares subject to outstanding options previously granted.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to the provisions of Rule 457(c) and (h) of the Securities Act of
1933, as amended (the "Securities Act"), based upon (A) the average of the
high and low prices per share of the Registrant's Common Stock, as reported on
the New York Stock Exchange on October 29, 2003 ($70.67) for 2,923,469 shares
available for issuance pursuant to future share and/or stock option awards,
and (B) the weighted average exercise price per share ($95.77) for 3,021,173
shares subject to outstanding options previously granted.
(3) The total filing fee for Common Stock registered herein of $40,121.49 is
offset pursuant to Rule 457(p) of the Securities Act by filing fees
previously paid with respect to unsold shares registered pursuant to
registration statements on Form S-8 filed by Neuberger Berman Inc., a wholly
owned subsidiary of the Registrant, on September 1, 2000 for the
Neuberger Berman Inc. Employee Stock Purchase Plan and the Neuberger Berman
Inc. Wealth Accumulation Plan (Registration No. 333-45058); and on October 7,
1999 for the 1999 Neuberger Berman Inc. Directors Stock Incentive Plan,
the 1999 Neuberger Berman Inc. Annual Incentive Plan, 1999 Neuberger Berman
Inc. Long-Term Incentive Plan, 1999 Neuberger Berman Inc. Deferred
Compensation Plan, and Neuberger Berman Inc. Employee Defined Contribution
Stock Incentive Plan (Registration No. 333-88579).


                               EXPLANATORY NOTE

         Pursuant to the terms of the Agreement and Plan of Merger dated as of
July 21, 2003, as amended by the First Amendment to Agreement and Plan of
Merger, dated as of September 22, 2003 (the "Merger Agreement"), Neuberger
Berman Inc. ("Neuberger") has merged with and into Ruby Acquisition Company
(the "Merger"), a direct wholly owned subsidiary of the Registrant, and is now
a direct wholly owned subsidiary of the Registrant.

         Pursuant to the Merger Agreement, the Registrant assumed the
obligations of Neuberger under the 1999 Neuberger Berman Inc. Long-Term
Incentive Plan, as amended. Shares issuable under the plan were originally
registered by Neuberger on Form S-8, Registration No. 333-88579. The number of
shares subject to outstanding awards or rights under the plans as of the
closing of the Merger has been recalculated pursuant to exchange ratios set
forth in the Merger Agreement.


<PAGE>
                                                                             3


                                    PART I
             INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS

ITEM 1. PLAN INFORMATION

          Not filed as part of this Registration Statement pursuant to Note to
Part I of Form S-8.

ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION

          Not filed as part of this Registration Statement pursuant to Note to
Part I of Form S-8.



                                    PART II
              INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE

         The following documents previously filed by the Registrant with the
Securities and Exchange Commission (the "SEC") pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act") are hereby incorporated
by reference in this Registration Statement:

         (1) The Registrant's Annual Report on Form 10-K for the fiscal year
ended November 30, 2002, filed with the SEC on February 28, 2003;

         (2) The Registrant's Quarterly Report on Form 10-Q for the quarterly
period ended February 28, 2003 filed with the SEC on April 14, 2003; for the
quarterly period ended May 31, 2003 filed with the SEC on July 15, 2003 and
for the quarterly period ended August 31, 2003, filed with the SEC on October
15, 2003;

         (3) The Registrant's Current Reports on Form 8-K, filed with the SEC
on each of December 11, December 19 and December 23 (two filings), 2002, and
January 9, March 17, March 20, March 21, April 29, May 1, May 2, May 8 (two
filings), May 13, May 20, May 27, June 2, June 19, June 24, July 1, July 10,
July 14, July 22, August 26, August 27, September 10, September 16, September
2, October 8 and October 31, 2003 (two filings); and

         (4) The description of the Registrant's Common Stock, as contained in
the Registrant's Form 8-A Registration Statement, filed with the SEC on
April 29, 1994.

         In addition, all documents filed by the Registrant pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date
of this Registration Statement and prior to the filing of a post-effective
amendment which indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference into this Registration Statement and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained herein or in any
subsequently filed document which also is incorporated or deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Registration Statement.

ITEM 4. DESCRIPTION OF SECURITIES

         Not applicable.

<PAGE>
                                                                             4

ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL

          Oliver Budde, Vice President and Associate General Counsel of the
Registrant, has rendered an opinion to the effect that, under applicable state
law, the shares of Common Stock to which this Registration Statement relates
will be, when issued, validly issued, fully paid and nonassessable.

ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS

          The Restated Certificate of Incorporation of the Registrant
authorizes the Registrant to indemnify its directors and officers to the
fullest extent permitted by Delaware General Corporation Law from time to
time. In addition, the directors of the Registrant are insured under officers'
and directors' liability insurance policies purchased by the Registrant.

          Section 145 of the Delaware General Corporation Law provides for
indemnification of directors and officers in certain circumstances, which may
include indemnification for liabilities arising under the Securities Act.

ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED

          Not applicable.

ITEM 8. EXHIBITS

          The Exhibit Index beginning on page 7 is hereby incorporated by
reference.

ITEM 9. UNDERTAKINGS

(a) The undersigned Registrant hereby undertakes:

          (1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:

                    (i) To include any prospectus required by Section 10(a)(3)
          of the Securities Act;

                    (ii) To reflect in the prospectus any facts or events
          arising after the effective date of this Registration Statement (or
          the most recent post-effective amendment thereof) which,
          individually or in the aggregate, represent a fundamental change in
          the information set forth in this Registration Statement.
          Notwithstanding the foregoing, any increase or decrease in volume of
          securities offered (if the total dollar value of securities offered
          would not exceed that which was registered) and any deviation from
          the low or high end of the estimated maximum offering range may be
          reflected in the form of prospectus filed with the SEC pursuant to
          Rule 424(b) if, in the aggregate, the changes in volume and price
          represent no more than a 20 percent change in the maximum aggregate
          offering price set forth in the "Calculation of Registration Fee"
          table in the effective registration statement; and

                    (iii) To include any material information with respect to
          the plan of distribution not previously disclosed in this
          Registration Statement or any material change to such information in
          this Registration Statement; provided, however, that the
          undertakings set forth in paragraphs (i) and (ii) above do not apply
          if this Registration Statement is on Form S-3, Form S-8 or Form F-3,
          and the information required to be included in a post-effective
          amendment by those paragraphs is contained in periodic reports filed
          with or furnished to the SEC by the Registrant pursuant to Section
          13 or 15(d) of the Exchange Act that are incorporated by reference
          in this Registration Statement.

<PAGE>
                                                                             5

          (2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.

          (3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.

(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.

(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the SEC such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.



<PAGE>
                                                                             6

                                SIGNATURE PAGE

          Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, State of New York, on
October 31, 2003.

                                          LEHMAN BROTHERS HOLDINGS INC.

                                          By:         /s/ Oliver Budde
                                              --------------------------------
                                              Name:   Oliver Budde
                                              Title:  Vice President

          Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.


<TABLE>
<CAPTION>

                Signature                                  Title                                Date
<S>                                               <C>                                   <C>

                    *                                   Chairman and                      October 31, 2003
------------------------------------------        Chief Executive Officer
           Richard S. Fuld, Jr.

                    *                                     Director                        October 31, 2003
------------------------------------------
            Michael L. Ainslie

                    *                                     Director                        October 31, 2003
------------------------------------------
              John F. Akers

                    *                                     Director                        October 31, 2003
------------------------------------------
             Roger S. Berlind

                    *                                     Director                        October 31, 2003
------------------------------------------
           Thomas H. Cruikshank

                    *                                     Director                        October 31, 2003
------------------------------------------
              Henry Kaufman

                    *                                     Director                        October 31, 2003
------------------------------------------
             John D. Macomber

                    *                                     Director                        October 31, 2003
------------------------------------------
               Dina Merrill

</TABLE>

* By: /s/ Jeffrey A. Welikson
     ----------------------------
        Jeffrey A. Welikson
        Attorney-in-Fact



<PAGE>
                                                                             7


                                 EXHIBIT INDEX


Exhibit                     Description of Exhibit
Number

4.1   --  1999 Neuberger Berman Inc. Long-Term Incentive Plan, as amended.

5.1   --  Opinion (and consent) of Oliver Budde, Vice President and Associate
          General Counsel of Lehman Brothers Holdings Inc., as to the validity
          of the shares of Common Stock to which this Registration Statement
          relates.

23.1  --  Consent of Oliver Budde, Vice President and Associate General
          Counsel of Lehman Brothers Holdings Inc. (included in Exhibit 5.1).

23.2  --  Consent of Ernst & Young, LLP, Independent Auditors.

24.1  --  Power of Attorney (incorporated by reference to Exhibit 24.1 of the
          Registrant's Form S-4 Registration Statement, filed with the SEC on
          August 15, 2003 (Registration No. 333-108025)).

<PAGE>

                                                                  EXHIBIT 4.1

                                AMENDMENT NO. 2
                                    TO THE
                          1999 NEUBERGER BERMAN INC.
                           LONG-TERM INCENTIVE PLAN

          WHEREAS, in connection with the merger of Neuberger Berman Inc.
("Neuberger") with and into Ruby Acquisition Company (the "Merger"), as set
forth in the Agreement and Plan of Merger dated as of July 21, 2003, as
amended by the First Amendment to Agreement and Plan of Merger, dated as of
September 22, 2003, among Lehman Brothers Holdings Inc., Ruby Acquisition
Company and Neuberger (the "Merger Agreement"), it is necessary to amend
certain of the stock incentive plans maintained by Neuberger.

          NOW, THEREFORE, pursuant to Article XI of the 1999 Neuberger Berman
Inc. Long-Term Incentive Plan (the "Plan") and resolutions of the Board of
Directors of Neuberger dated October 31, 2003, the Plan is hereby amended,
effective as of October 31, 2003, as follows:

1.     The definition of the term "Board" as set forth in Section 2.1 of the
Plan is hereby amended by deleting the current definition and replacing it with
the following:

          ""Board" means the Board of Directors of Lehman Brothers Holdings
          Inc."

2.     The definition of the term "Common Stock" as set forth in Section 2.1
of the Plan is hereby amended by deleting the current definition and replacing
it with the following:

          ""Common Stock" means the common stock of Lehman Brothers Holdings
          Inc., par value $0.10 per share."

3.     The definition of the term "Company" as set forth in Section 2.1 of the
Plan is hereby amended by deleting the current definition and replacing it
with the following:

          ""Company" means Lehman Brothers Holdings Inc."

4.     The definition of the term "Employee" as set forth in Section 2.1 of the
Plan is hereby amended by deleting the current definition and replacing it
with the following:

          ""Employee" means any officer or employee of Neuberger Berman Inc.
          or any of its subsidiaries, as applicable."

5.     The definition of the term "Initial Public Offering" as set forth in
Section 2.1 of the Plan is hereby amended by deleting the current definition
and replacing it with the following:

          ""Initial Public Offering" means the first offering of common stock
          of Neuberger Berman Inc. to the general public pursuant to an
          underwritten public offering effective August 2, 1999."

6.     The definition of the term "Participant" as set forth in Section 2.1 of
the Plan is hereby amended by deleting the current definition and replacing it
with the following:

          "Participant" means any Employee, prospective Employee, director,
          consultant or advisor to Neuberger Berman Inc. or any of its
          subsidiaries, as applicable, who, as of October 31, 2003, had
          previously been designated as a Participant by the compensation
          committee of Neuberger Berman Inc. and received Awards, or any
          prospective employee of the Company or any of its Subsidiaries
          otherwise designated by the Committee to receive an Award under the
          Plan.

<PAGE>
                                                                             2

7.     The reference to the number of Shares available for Awards (as defined
in the Plan) under the Plan contained in Section 4.1 of the Plan is hereby
amended by deleting the number "10,000,000" and replacing it with the
following number (rounded to the nearest whole share), which reflects, in
accordance with Section 4.3 of the Plan, among other things, the effect of the
Merger and the application of the Exchange Ratio and the Special Option
Exchange Ratio (as such terms are defined in the Merger Agreement) on the
number of shares of Neuberger common stock subject to applicable outstanding
Awards as of the Effective Time (as defined in the Merger Agreement) and which
includes such number of Shares to be subject to Awards to be granted in
connection with the Merger: 5,944,642.

8.     Section 5.5 of the Plan is hereby amended as follows:

          (a) The first sentence of Section 5.5 is hereby amended by adding
the word "not" after the phrase "The Company may" in the first line of such
sentence.

          (b) The second sentence of Section 5.5 is hereby deleted in its
entirety.


          All other provisions of the Plan shall remain in full force and
effect, except to the extent modified by the foregoing.

<PAGE>


                                AMENDMENT NO. 1
                                    TO THE
                          1999 NEUBERGER BERMAN INC.
                           LONG-TERM INCENTIVE PLAN

          This Amendment No. 1 (the "Amendment") to the 1999 Neuberger Berman
Inc. Long-Term Incentive Plan (the "Plan") is made effective as of this 18th
day of July, 2000.

          Pursuant to resolutions of the Board of Directors (the "Board") of
Neuberger Berman Inc. (the "Company") dated July 18, 2000, the Plan is hereby
amended as follows:

          The definition of the term "Change in Control" in Section 2.1 of the
Plan is hereby amended to read as follows:

          "Change in Control" means the occurrence of any of the following
events:

                    (a) the members of the Board at the beginning of any
          consecutive twenty-four calendar month period (the "Incumbent
          Directors") cease for any reason other than due to death to
          constitute at least a majority of the members of the Board, provided
          that any director whose election, or nomination for election by the
          Company's stockholders, was approved by a vote of at least a
          majority of the members of the Board then still in office who were
          members of the Board at the beginning of such twenty-four calendar
          month period other than as a result of a proxy contest, or any
          agreement arising out of an actual or threatened proxy contest,
          shall be treated as an Incumbent Director; or

                    (b) any "person", including a "group" (as such terms are
          used in Sections 13(d) and 14(d)(2) of the Act), but excluding the
          Company, any Subsidiary or any employee benefit plan of the Company
          or any Subsidiary becomes the "beneficial owner" (as defined in Rule
          13(d)-3 under the Act), directly or indirectly, of securities of the
          Company representing 50% or more of the combined voting power of the
          Company's then outstanding securities; or

                    (c) the stockholders of the Company shall approve a
          definitive agreement (i) for the merger or other business
          combination of the Company with or into another corporation, a
          majority of the directors of which were not directors of the Company
          immediately prior to the merger and in which the stockholders of the
          Company immediately prior to the effective date of such merger own a
          percentage of the voting power in such corporation that is less than
          one-half of the percentage of the voting power they owned in the
          Company immediately prior to such transaction or (ii) for the sale
          or other disposition of all or substantially all of the assets of
          the Company to any other entity; provided, in each case, that such
          transaction shall have been consummated; or

                    (d) the purchase of Common Stock pursuant to any tender or
          exchange offer made by any "person", including a "group" (as such
          terms are used in Sections 13(d) and 14(d)(2) of the Act), other
          than the Company, any Subsidiary, or an employee benefit plan of the
          Company or any Subsidiary, for 50% or more of the Common Stock of
          the Company.

          Notwithstanding the foregoing, a "Change in Control" shall not be
deemed to occur in the event the Company files for bankruptcy, liquidation or
reorganization under the United States Bankruptcy Code."

          Except as expressly provided herein, the terms and conditions of the
Plan shall remain unchanged.

<PAGE>

                          1999 NEUBERGER BERMAN INC.
                           LONG-TERM INCENTIVE PLAN


                                   ARTICLE I
                                   PURPOSES

          The purposes of the 1999 Neuberger Berman Inc. Long-Term Incentive
Plan (the "Plan") is to foster and promote the long-term financial success of
the Company and materially increase shareholder value by (A) motivating
superior performance by means of performance-related incentives, (B)
encouraging and providing for the acquisition of an ownership interest in the
Company by Employees and (C) enabling the Company to attract and retain the
services of outstanding employees upon whose judgment, interest and special
effort the successful conduct of its operations is largely dependent.

                                  ARTICLE II
                                  DEFINITIONS

          2.1 Certain Definitions. Capitalized terms used herein without
definition shall have the respective meanings set forth below:

          "Act" means the Securities Exchange Act of 1934, as amended.

          "Adjustment Event" means any stock dividend, stock split, share
combination, extraordinary cash dividend, recapitalization, reorganization,
merger, consolidation, split-up, spin-off, combination, exchange of shares or
other similar event affecting the Common Stock of the Company.

          "Award" means any Option, Restricted Stock, Restricted Unit,
Incentive Stock, Incentive Unit, Deferred Share, Supplemental Unit or any
combination thereof, including Awards combining two or more types of Awards in
a single grant.

          "Board" means the Board of Directors of the Company.

          "Cause" means any of:

          (a) the Participant's having been convicted of, or entered a plea of
Nolo Contendere to, a crime that constitutes a felony or a misdemeanor
involving fraud, false statements or misleading omissions, perjury,
embezzlement, bribery, forgery or counterfeiting or other similar crime (or an
equivalent charge in jurisdictions that do not use such designations);

          (b) the willful failure by the Participant (other than due to
physical or mental illness) to perform substantially his duties as an employee
of the Company or any Subsidiary after reasonable notice to the Participant of
such failure;

          (c) the Participant's violation of any securities or commodities
laws, any rules or regulations issued pursuant to such laws, or the rules and
regulations of any securities or commodities exchange or association of which
the Company or any of its Subsidiaries or affiliates is a member;

          (d) the Participant's violation of any Company policy concerning
hedging or confidential or proprietary information, or material violation of
any other Company policy as in effect from time to time;

          (e) the Participant's engaging in any act or making any statement
which impairs, impugns, denigrates, disparages or negatively reflects upon the
name, reputation or business interests of the Firm; or

<PAGE>
                                                                             2


          (f) the Participant's engaging in any conduct that is injurious to
the Company or any Subsidiary; or

          (g) the breach by the Participant of any written covenant or
agreement with the Company or any Subsidiary not to disclose any information
pertaining to the Company or any Subsidiary or not to compete or interfere
with the Company or any Subsidiary.

          The determination as to whether "Cause" has occurred shall be made
by the Committee. The Committee shall also have the authority to waive the
consequences under the Plan of the existence or occurrence of any of the
events, acts or omissions constituting "Cause."

          "Change in Control" means the occurrence of any of the following
events:

               (a) the members of the Board at the beginning of any consecutive
twenty-four calendar month period (the "Incumbent Directors") cease for any
reason other than due to death to constitute at least a majority of the
members of the Board, provided that any director whose election, or nomination
for election by the Company's stockholders, was approved by a vote of at least
a majority of the members of the Board then still in office who were members
of the Board at the beginning of such twenty-four calendar month period other
than as a result of a proxy contest, or any agreement arising out of an actual
or threatened proxy contest, shall be treated as an Incumbent Director; or

               (b) any "person," including a "group" (as such terms are used in
Sections 13(d) and 14(d)(2) of the Act), but excluding the Company, any
Subsidiary or any employee benefit plan of the Company or any Subsidiary
becomes the "beneficial owner" (as defined in Rule 13(d)-3 under the Act),
directly or indirectly, of securities of the Company representing 20% or more
of the combined voting power of the Company's then outstanding securities; or

               (c) the stockholders of the Company shall approve a definitive
agreement (I) for the merger or other business combination of the Company with
or into another corporation, a majority of the directors of which were not
directors of the Company immediately prior to the merger and in which the
stockholders of the Company immediately prior to the effective date of such
merger own a percentage of the voting power in such corporation that is less
than one-half of the percentage of the voting power they owned in the Company
immediately prior to such transaction or (II) for the sale or other
disposition of all or substantially all of the assets of the Company to any
other entity; provided, in each case, that such transaction shall have been
consummated; or

               (d) the purchase of Common Stock pursuant to any tender or
exchange offer made by any "person," including a "group" (as such terms are
used in Sections 13(d) and 14(d)(2) of the Act), other than the Company, any
Subsidiary, or an employee benefit plan of the Company or any Subsidiary, for
20% or more of the Common Stock of the Company.

          Notwithstanding the foregoing, a "Change in Control" shall not be
deemed to occur in the event the Company files for bankruptcy, or
reorganization under the United States Bankruptcy Code.

          "Change in Control Price" means the highest price per Share offered
in conjunction with any transaction resulting in a Change in Control (as
determined in good faith by the Committee (as constituted before the Change in
Control) if any part of the offered price is payable other than in cash) or,
in the case of a Change in Control occurring solely by reason of a change in
the composition of the Board, the highest Fair Market Value of the Stock on
any of the 30 trading days immediately preceding the date on which a Change in
Control occurs.

          "Code" means the Internal Revenue Code of 1986, as amended, and the
regulations thereunder.

          "Committee" means the Compensation Committee of the Board, or when
section 162(m) of the Code or Rule 16b promulgated under the Act would require
action to be taken by a committee of "outside directors" or "Non-Employee
Directors," as the case may be, the "Committee" shall be deemed to refer to a
subcommittee of the Compensation Committee that consist of two or more



<PAGE>
                                                                             3

members meeting such requirements, or the full Board in the absence of such
a subcommittee.

          "Common Stock" means the common stock of the Company, par value
$0.01 per share.

          "Company" means Neuberger Berman Inc., a Delaware corporation, any
successor thereto.

          "Deferred Share" means the deferred share units that confer upon a
Participant the right to receive shares of Common Stock at the end of a
specified deferral period as set forth in Article VIII .

          "Disability" means a total disability within the meaning of any
long-term disability plan maintained for the benefit of the Participant or, if
the Participant is not covered by such a disability plan, then as determined
by the Committee.

          "Dividend Equivalents" means dividends paid by the Company with
respect to Shares corresponding to Awards awarded under the Plan.

          "Employee" means any officer or employee of the Company or any
Subsidiary.

          "Executive Officer" means those persons who are officers of the
Company within the meaning of Rule 16a-1(f) promulgated under the Act.

          "Fair Market Value" means, as of any date of determination, the
closing price of a Share on the New York Stock Exchange (or on such other
recognized market or quotation system on which the trading prices of Common
Stock are traded or quoted at the relevant time). In the event that there are
no Common Stock transactions reported on such exchange or system on such date,
Fair Market Value shall mean the closing price of a Share on the immediately
preceding day on which Common Stock transactions were so reported.
Notwithstanding the foregoing, with respect to any Award which becomes
effective upon the closing of the Initial Public Offering, Fair Market Value
shall mean the initial price at which a Share is offered to the public
pursuant to the Initial Public Offering.

          "Incentive Stock" shall mean an award of Common Stock that is
forfeitable until the completion of specified Performance Criteria as provided
for in Section 7.1.

          "Incentive Unit" shall mean a contractual right to receive Common
Stock (or cash based on the Fair Market Value of Common Stock) until the
completion of specified Performance Criteria as provided for in Section 7.1.

          "Initial Public Offering" shall mean the first offering of the
Common Stock to the general public pursuant to an underwritten public
offering.

          "Normal Retirement" means a termination of the Participant's
employment under circumstances that the Committee determines as qualifying as
retirement at normal retirement age for purposes of the Plan and not
inconsistent with the treatment of the Participant under other Company plans.

          "Option" means the right to purchase Common Stock at a stated price
for a specified period of time.

          "Participant" means any director, Employee, or prospective Employee
of, or any consultant or advisor to, the Company designated by the Committee
to receive an Award under the Plan.

          "Performance Period" means each calendar year or multi-year cycle as
determined by the Committee.

          "Period of Restriction" means the period during which a Restricted
Stock or Restricted Unit is subject to forfeiture.

<PAGE>
                                                                             4

          "Plan" means this 1999 Neuberger Berman Inc. Long-Term Incentive
Plan, as the same may be amended from time to time.

          "Qualifying Termination of Employment" means a termination of a
Participant's employment with the Company or any of its Subsidiaries by reason
of the Participant's death, Disability, early retirement with the consent of
the Committee or Normal Retirement.

          "Restricted Stock" means an award of Common Stock made pursuant to
Section 6.1 that is forfeitable by the Participant until the completion of a
specified period of future service or until otherwise determined by the
Committee or in accordance with the terms of the Plan.

          "Restricted Unit" means a contractual right to receive Common Stock,
or cash based on the Fair Market Value of Common Stock, made pursuant to
Section 6.1 that is forfeitable by the Participant until the completion of a
specified period of future service or until otherwise determined by the
Committee or in accordance with the terms of the Plan.

          "Retirement" means termination of a Participant's employment on or
after the Normal Retirement Date or, with the Committee's approval, on or
after any early retirement date established under any retirement plan
maintained by the Company, or any Subsidiary in which the Participant
participates.

          "Share" means a share of Common Stock.

          "Subsidiary" means any corporation in which the Company owns,
directly or indirectly, stock representing 50% or more of the voting power of
all classes of stock entitled to vote and any other business organization,
regardless of form, in which the Company possesses directly or indirectly 50%
or more of the total combined equity interests in such organization.

          2.2 Additional Definitions.

          "Alternative Award" has the meaning given in Section 9.2.

          "Deferred Amount" has the meaning given in Section 8.1.

          "ISOs" has the meaning given in Section 5.1.

          "NSOs" has the meaning given in Section 5.1.

          "Performance Restriction" has the meaning given in Section 7.2(a).

          "Permitted Transferees" has the meaning given in Section 12.1.

          "Reload Options" has the meaning given in Section 5.4.

          "Supplemental Unit" has the meaning given in Section 8.1.

          2.3 Gender and Number. Except when otherwise indicated by the
context, words in the masculine gender used in the Plan shall include the
feminine gender, the singular shall include the plural, and the plural shall
include the singular.

<PAGE>
                                                                             5

                                  ARTICLE III
                            POWERS OF THE COMMITTEE

          3.1 Power to Grant. The Committee shall determine the Participants
to whom Awards shall be granted, the type or types of Awards to be granted and
the terms and conditions of any and all such Awards. The Committee may
establish different terms and conditions for different types of Awards, for
different Participants receiving the same type of Award and for the same
Participant for each Award such Participant may receive, whether or not
granted at different times.

          3.2 Administration. The Committee shall be responsible for the
administration of the Plan, including, without limitation, determining which
Participants receive Awards, what kind of Awards are made under the Plan and
for what number of shares, and the other terms and conditions of each such
Award. The Committee shall have the responsibility of construing and
interpreting the Plan and of establishing and amending such rules and
regulations as it may deem necessary or desirable for the proper
administration of the Plan. Any decision or action taken or to be taken by the
Committee, arising out of or in connection with the construction,
administration, interpretation and effect of the Plan and of its rules and
regulations, shall, to the greatest extent permitted by applicable law, be
within its absolute discretion (except as otherwise specifically provided
herein) and shall be conclusive and binding upon the Company and its
Subsidiaries, all Participants and any person claiming under or through any
Participant. No term of this Plan relating to ISOs shall be interpreted,
amended or altered, nor shall any discretion or authority granted under the
Plan be so exercised, so as to disqualify the Plan under section 422 of the
Code.

          3.3 Delegation by the Committee. The Committee may delegate its
authority under this Plan; provided that the Committee shall in no event
delegate its authority with respect to the compensation of the Chief Executive
Officer of the Company, the four most highly compensated executive officers
(as determined under Section 162(m) of the Code and regulations thereunder) of
the Company and any other individual whose compensation the Board or Committee
reasonably believes may become subject to Section 162(m) of the Code.


                                  ARTICLE IV
                             STOCK SUBJECT TO PLAN

          4.1 Number. Subject to the provisions of this Article IV, the number
of Shares subject to Awards under the Plan may not exceed 10,000,000 Shares,
plus any Shares that, after the effective date of the Plan, become available
for Awards under this Plan in accordance with Section 4.2 below. Without
limiting the generality of the foregoing, whenever Shares are received by the
Company in connection with the exercise of or payment for any Award granted
under the Plan only the net number of Shares actually issued shall be counted
against the foregoing limit. The Shares to be delivered under the Plan may
consist, in whole or in part, of treasury stock or authorized but unissued
Common Stock not reserved for any other purpose.

          4.2. Canceled, Terminated, or Forfeited Awards. Any Shares subject
to any Award granted hereunder which for any reason is canceled, terminated or
otherwise settled without the issuance of any Common Stock after the effective
date of this Plan shall be available for further Awards under the Plan.

          4.3. Adjustment in Capitalization. In the event of any Adjustment
Event such that an adjustment is required to preserve, or to prevent
enlargement of, the benefits or potential benefits made available under this
Plan, then the Committee shall, in such manner as the Committee shall deem
equitable, adjust any or all of (A) the number and kind of Shares which
thereafter may be awarded or optioned and sold under the Plan (including,
without termination, adjusting the limits on the number and types of certain
Awards that may be made under the Plan), (B) the number and kinds of Shares
subject to outstanding Options and other Awards and (C) the grant, exercise or
conversion price with respect to any of the foregoing. In addition, the
Committee may make provisions for a cash payment to a Participant or a person
who has an outstanding Option or other Award. The number of Shares subject to
any Option or other Award shall always be a whole number.

<PAGE>
                                                                             6
                                   ARTICLE V
                                 STOCK OPTIONS

          5.1 Grant of Options. The Committee shall have the power to grant
Options that are "incentive stock options" within the meaning of section 422
of the Code ("ISOs") or that are non-statutory stock options ("NSOs") to any
Participant and to determine (A) the number of ISOs and the number of NSOs to
be granted to each Participant and (B) the other terms and conditions of such
Awards. An Option shall be an NSO unless otherwise specified by the Committee
at the time of grant. The maximum number of Shares with respect to which
Options may be granted to any one Participant in any calendar year shall be
1,000,000, in the case of 1999, and in the case of any subsequent year, 110%
of the maximum permitted for the immediately preceding calendar year. Each
Option shall be evidenced by an Option agreement that shall specify (A) the
type of Option granted, (B) the number of Shares to which the Option pertains,
(C) the exercise price, (D) the period in which the Option may be exercised
and (E) such terms and conditions not inconsistent with the Plan as the
Committee shall determine.

          5.2 Exercise Price. Unless otherwise determined by the Committee,
Options granted pursuant to the Plan shall have an exercise price that is not
less than the Fair Market Value of a Share on the date the Option is granted.

          5.3 Exercisability. Unless otherwise determined by the Committee,
Options awarded under the Plan shall vest and become exercisable in three
equal annual installments commencing on the second anniversary of the date
such Options are granted, subject to the Participant's continuous employment
with the Company or a Subsidiary from the date of grant through the applicable
vesting date. No Option shall be exercisable for more than 10 years after the
date on which it is granted.

          5.4 Payment. The Committee shall establish procedures governing the
exercise of Options. Without limiting the generality of the foregoing, the
Committee may provide that payment of the exercise price may be made (A) in
cash or its equivalent, (B) by exchanging Shares owned by the optionee (which
are not the subject of any pledge or other security interest), (C) through an
arrangement with a broker approved by the Company whereby payment of the
exercise price is accomplished with the proceeds of the sale of Common Stock
or (D) by any combination of the foregoing; provided that the combined value
of all cash and cash equivalents paid and the Fair Market Value of any such
Common Stock so tendered to the Company, valued as of the date of such tender,
is at least equal to such exercise price. No Shares shall be delivered
pursuant to any exercise of an Option unless arrangements satisfactory to the
Committee have been made to assure full payment of the exercise price therefor
and any required withholding or other similar taxes or governmental charges.
Upon such terms and conditions as the Committee may establish from time to
time, a Participant may be permitted to defer the receipt of Shares otherwise
deliverable upon exercise of an Option.

          5.5 Reload Options. The Committee may provide that a Participant
(or,if applicable, his or her Permitted Transferee) who delivers Shares that
have been owned by such Participant (or Permitted Transferee) for any minimum
period of time specified by the Committee to exercise an Option (when the Fair
Market Value of Common Stock exceeds the exercise price of such Option) will
automatically be granted new Options ("Reload Options") for a number of Shares
equal to the number of Shares so delivered. Unless the Committee determines
otherwise, such Reload Options will be subject to the same terms and
conditions (including the same expiration date) as the related Option except
(A) that the exercise price shall initially be equal to the Fair Market Value
of a Share on the date such Reload Option is granted and (B) such Reload
Option shall not be exercisable prior to the six month anniversary of the date
of grant and, thereafter, shall be exercisable in full.

          5.6 Termination of Employment. Unless otherwise determined by the
Committee at or after the date of grant, in the event a Participant's
employment terminates by reason of a Qualifying Termination of Employment, the
Participant (or the Participant's beneficiary or legal representative) may
exercise any Options (regardless of whether then exercisable) until the
earlier of (A) the twelve-month anniversary of the date of such termination of
employment and (B) the date such Options would otherwise expire but for the
operation of this Section 5.6. Unless otherwise determined by the Committee at
or after the date of grant, in the event a Participant's employment terminates
for any reason other than a Qualifying Termination of Employment, any Option
granted to such

<PAGE>
                                                                             7

Participant, whether or not then exercisable, shall be forfeited and cancelled
as of the date of such termination of employment.

          5.7 Buyout. The Committee may at any time offer to buy out an Option
previously granted for a payment in cash, based on such terms and conditions
as the Committee shall establish and communicate to the optionee at the time
that such offer is made.


                                  ARTICLE VI
                     RESTRICTED STOCK AND RESTRICTED UNITS

          6.1 Grant of Restricted Stock and Restricted Units. The Committee
shall have the power to grant Restricted Stock or Restricted Units to any
Participant and to determine (A) the number of Shares of Restricted Stock and
the number of Restricted Units to be granted to each Participant, (B) the
Restriction Period(s) and (B) the other terms and conditions of such Awards.
The Committee shall require that the stock certificates evidencing any
Restricted Stock or Restricted Units be held in the custody of the Secretary
of the Company until the Period of Restriction lapses, and that, as a
condition of any Restricted Stock or Restricted Unit award, the Participant
shall have delivered a stock power, endorsed in blank, relating to the Share
covered by such award. Each grant of Restricted Stock or Restricted Units
shall be evidenced by a written agreement setting forth the terms of such
Award.

          6.2 Vesting of Restricted Stock and Restricted. Unless otherwise
determined by the Committee at or after the date of grant, Restricted Stock or
Restricted Units granted pursuant to Section 6.1 shall vest and become
nonforfeitable, and the Period of Restriction with respect to such Restricted
Stock or Restricted Units will lapse, in equal annual installments commencing
on the third anniversary of the date of grant.

          6.3 Dividend Equivalents. (a) Restricted Stock. Unless otherwise
determined by the Committee at the time of grant, Participants holding
outstanding Restricted Stock shall be entitled to receive currently all
Dividend Equivalents paid with respect to such Shares of Restricted Stock.

          (b) Restricted Units. The Committee will determine whether and to
what extent to credit to the account of, or to pay currently to, each
recipient of a Restricted Unit, any Dividend Equivalents. To the extent
provided by the Committee at or after the date of grant, any cash Dividend
Equivalents credited to a Participant's account shall be deemed to have been
invested in Shares on the record date established for the related dividend
and, accordingly, a number of Restricted Units shall be credited to such
Participant's account equal to the greatest whole number which may be obtained
by dividing (I) the value of such Dividend Equivalent on the record date by
(II) the Fair Market Value of a Share on such date. Any additional Restricted
Units credited in respect of Dividend Equivalents shall become vested and
nonforfeitable, if at all, on the same terms and conditions as are applicable
in respect of the Restricted Units with respect to which such Dividend
Equivalents were payable.

          6.4 Termination of Employment. Unless otherwise determined by the
Committee at or after the date of grant, in the event a Participant's
employment terminates by reason of a Qualifying Termination of Employment
during the Period of Restriction, a pro rata portion of any Shares related to
a Restricted Stock or Restricted Unit held by such Participant shall become
nonforfeitable, based upon the percentage of which the numerator is the
portion of the Period of Restriction that expired prior to the Participant's
termination and the denominator is the number of days in the Period of
Restriction. Unless otherwise determined by the Committee at or after the date
of grant, in the event a Participant's employment terminates for any reason
other than a Qualifying Termination of Employment during the Period of
Restriction, any Restricted Stock or Restricted Units held by such Participant
shall be forfeited and cancelled as of the date of such termination of
employment.

          6.5 Settlement of Restricted Units. Unless the Committee determines
otherwise at or after the date of grant, when a Restriction Period with
respect to an Award of Restricted Units lapses and the Restricted Units become
vested and nonforfeitable, the Participant shall receive (I) one Share for
each such Restricted Unit (including additional Restricted Units credited in
respect of Dividend Equivalents) or (II) if the Committee so determines, the

<PAGE>
                                                                             8

Committee may direct the Company to pay to the Participant the Fair Market
Value of such Shares as of such payment date.


                                  ARTICLE VII
                               INCENTIVE AWARDS

          7.1 Grant of Incentive Stock and Incentive Units. The Committee
shall have the authority to grant Incentive Stock or Incentive Units to any
Participant and to determine (A) the number of Incentive Stock and the number
of Incentive Units to be granted to each Participant, (B) the restrictions
pursuant to which such Award is subject to forfeiture by reason of the
Performance Restriction established by the Committee pursuant to Section 7.2
not being met in whole or in part and (C) the other terms and conditions of
such Awards. Each grant of Incentive Stock or Incentive Units shall be
evidenced by a written agreement setting forth the terms of such Award.

          7.2 Performance Restriction. (a) Within 90 days after each
Performance Period begins (or such other date as may be required or permitted
under Section 162(m), if applicable), the Committee shall establish the
performance objective or objectives for the applicable Performance Period that
must be satisfied in order for an Award to be vested and nonforfeitable (the
"Performance Restriction"). Any such Performance Restriction will be based
upon the relative or comparative achievement of one or more of the following
criteria, as determined by the Committee: (I) earnings per share on the
Company's Common Stock; (II) growth in the Company's revenue; (III) growth in
the Company's assets under management; (IV) increase in the Company's net
income; (V) return on shareholder's equity; (VI) controlling expenses; and
(VII) relative performance versus a peer group of companies.

          (b) The Performance Restriction related to Incentive Stock or
Incentive Units shall lapse upon the determination by the Committee that the
objective or objectives for the applicable Performance Period have been
attained, in whole or in part. The Committee may provide at the time of grant
that in the event the objective or objectives are attained in part, a
specified portion (which may be zero) of the Award will vest and become
nonforfeitable and the remaining portion shall be forfeited.

          7.3 Dividend Equivalents. (a) Incentive Stock. Unless otherwise
determined by the Committee at or after the date of grant, Participants
granted Incentive Stock shall be entitled to receive cash Dividend Equivalents
currently.

          (b) Incentive Units. The Committee will determine whether and to
what extent to credit to the account of, or to pay currently to, each
recipient of an Incentive Unit, any Dividend Equivalents. To the extent
provided by the Committee at or after the date of grant, any cash Dividend
Equivalents with respect to the Incentive Units credited to a Participant's
account shall be deemed to have been invested in Shares on the record date
established for the related dividend and, accordingly, a number of Incentive
Units, as the case may be, shall be credited to such Participant's account
equal to the greatest whole number which may be obtained by dividing (I) the
value of such Dividend Equivalent on the record date by (II) the Fair Market
Value of a Share on such date. Any additional Incentive Unit credited in
respect of Dividend Equivalents shall become vested and nonforfeitable, if at
all, on the same terms and conditions as are applicable in respect of the
Incentive Unit with respect to which such Dividend Equivalents were payable.

          7.4 Termination of Employment. Unless the Committee otherwise
determines at or after the date of grant, in the event that a Participant's
Employment terminates by reason of a Qualifying Termination of Employment
during the Performance Period, any award of Incentive Stock or Incentive Units
shall become vested and nonforfeitable at the end of the Performance Period as
to that number of such Incentive Stock or Incentive Units, as the case may be,
that is equal to that percentage, if any, of such Award that would have been
earned had the Participant's employment not so terminated prior to the
expiration of the Performance Period times a fraction, the numerator of which
is the number of days employed during the Performance Period and the
denominator of which is the total number of days during the Performance
Period. Unless otherwise determined by the Committee at or after the date of
grant, in the event a Participant's employment terminates for any reason other
than a Qualifying Termination of Employment during the Performance Period, any
Incentive Stock or Incentive Units held by such Participant shall be forfeited
and cancelled as of the date of such termination of employment.

<PAGE>
                                                                             9

          7.5 Settlement of Incentive Units. Unless the Committee determines
otherwise at or after the date of grant, when a Performance Restriction with
respect to an Award of Incentive Units lapses and the Incentive Units become
vested and nonforfeitable, the Participant shall receive (I) one Share for
each such Incentive Unit (including additional Incentive Units credited in
respect of Dividend Equivalents) or (II) if the Committee so determines, the
Committee may direct the Company to pay to the Participant the Fair Market
Value of such Shares as of such payment date.


                                 ARTICLE VIII
                                DEFERRED SHARES

          8.1 Deferred Share Awards. The Committee shall have the authority to
grant Deferred Shares to any Participant and to determine (I) the number of
Deferred Shares granted to each Participant, (II) the date such Deferred
Shares shall become vested and (III) the date such Deferred Shares will be
payable to the Participant. In addition, on such date or dates as shall be
established by the Committee and subject to such terms and conditions as the
Committee shall determine, a Participant may be permitted to elect to defer
receipt of all or a portion of his annual compensation and/or annual incentive
bonus ("Deferred Amount") payable by the Company or a Subsidiary and receive
in lieu thereof a number of Deferred Shares equal to the greatest whole number
which may be obtained by dividing (I) the Deferred Amount by (II) the Fair
Market Value of a Share on the date such compensation or bonus would otherwise
have been payable to the Participant. No Shares will be issued at the time an
award of Deferred Shares is made and the Company shall not be required to set
aside a fund for the payment of any such award. The Company will establish a
separate account for the Participant and will record in such account the
number of Deferred Shares awarded to the Participant. To the extent the
Committee so determines, a Participant who elects to defer receipt of his or
her compensation or bonus and receive Deferred Shares shall receive that
number of supplemental Deferred Shares ("Supplemental Units") equal to the
greatest whole number which may be obtained by dividing (I) such percentage of
the Deferred Amount as is determined by the Committee by (II) the Fair Market
Value of a Share on the date of grant. Each grant of Deferred Shares and
Supplemental Units shall be evidenced by a written agreement setting forth the
terms of such Award.

          8.2 Vesting of Deferred Shares and Supplemental Units. The portion
of each Deferred Shares, together with any Dividend Equivalents credited with
respect thereto, shall be fully vested at all times. Unless the Committee
provides otherwise at or after the date of grant, the Supplemental Units,
together with any Dividend Equivalents credited with respect thereto, will
become vested in full on the fifth anniversary of the date the corresponding
Deferred Amount would have been paid absent the Participant's election to
defer receipt thereof, subject to the Participant's continuous employment with
the Company or a Subsidiary through such vesting date.

          8.3 Dividend Equivalents. The Committee will determine whether and
to what extent Dividend Equivalents will be credited to the account of, or
paid currently to, a recipient of a Deferred Shares or Supplemental Units. To
the extent provided by the Committee at or after the date of grant, any cash
Dividend Equivalents with respect to the Deferred Shares and Supplemental
Units deemed credited to a Participant's account shall be deemed to have been
invested in Shares on the record date established for the related dividend
and, accordingly, a number of Deferred Shares or Supplemental Units, as the
case may be, shall be credited to such Participant's account equal to the
greatest whole number which may be obtained by dividing (I) the amount of such
Dividend Equivalent on the record date by (II) the Fair Market Value of a
Share on such date.

          8.4 Termination of Employment. Unless the Committee otherwise
determines at or after the date of grant, in the event that a Participant's
employment terminates by reason of a Qualifying Termination of Employment
during the Performance Period, any Supplemental Units (and related Dividend
Equivalents) granted to a Participant shall become vested and nonforfeitable.
Unless otherwise determined by the Committee at or after the date of grant, in
the event a Participant's employment terminates for any reason other than a
Qualifying Termination of Employment during the Performance Period, any
Supplemental Units (and related Dividend Equivalents) held by such Participant
shall be forfeited and cancelled as of the date of such termination of
employment. In the event that a Participant's employment is terminated for
Cause (or, following the date the Participant's employment terminates, the
Committee determines that circumstances exist such that the Participant's
employment could have been terminated for Cause),

<PAGE>
                                                                            10

any Supplemental Units (and related Dividend Equivalents) granted to such
Participant, whether or not then vested, shall be forfeited and cancelled as
of the date of such termination of employment.

          8.5 Settlement of Deferred Shares. Unless the Committee determines
otherwise at or after the date of grant, a Participant shall receive as of the
date of such Participant's termination of employment (or such other date as
may be elected by the Participant in accordance with the rules and procedures
of the Committee) (I) one Share for each Deferred Share credited to such
Participant's account and (II) subject to Section 8.4, one Share for each
Supplemental Unit that shall have become vested. The Committee may provide in
the Award agreement applicable to any Deferred Shares or Supplemental Units
that, in lieu of issuing Shares, the Committee may direct the Company to pay
to the Participant the Fair Market Value of such Shares as of such payment
date.


                                  ARTICLE IX
                               CHANGE IN CONTROL

          9.1 Accelerated Vesting and Payment. Subject to the provisions of
Sections 9.2 below, in the event of a Change in Control, each Option shall be,
at the discretion of the Committee, either canceled in exchange for a payment
in cash of an amount equal to the excess, if any, of the Change in Control
Price over the exercise price for such Option, or fully exercisable regardless
of the exercise schedule otherwise applicable to such Option and all other
Awards shall become nonforfeitable and be immediately transferable or payable,
as the case may be.

          9.2 Alternative Awards. Notwithstanding Section 9.1, no
cancellation, acceleration of exercisability, vesting, cash settlement or
other payment shall occur with respect to any Award or any class of Awards if
the Committee reasonably determines in good faith prior to the occurrence of a
Change in Control that such Award or Awards shall be honored or assumed, or
new rights substituted therefor (such honored, assumed or substituted award an
"Alternative Award"), by a Participant's employer (or the parent or a
Subsidiary of such employer) immediately following the Change in Control,
provided that any such Alternative Award must:

          (i) be based on stock which is traded on an established securities
market, or which will be so traded within 60 days of the Change in Control;

          (ii) provide such Participant (or each Participant in a class of
Participants) with rights and entitlements substantially equivalent to or
better than the rights, terms and conditions applicable under such Award,
including, but not limited to, an identical or better exercise or vesting
schedule and identical or better timing and methods of payment;

          (iii) have substantially equivalent economic value to such Award
(determined at the time of the Change in Control);

          (iv) have terms and conditions which provide that in the event that
the Participant's employment is involuntarily terminated or constructively
terminated, any conditions on a Participant's rights under, or any
restrictions on transfer or exercisability applicable to, each such
Alternative Award shall be waived or shall lapse, as the case may be.

For this purpose, a constructive termination shall mean a termination by a
Participant following a material reduction in the Participant's base salary or
a Participant's incentive compensation opportunity or a material reduction in
the Participant's responsibilities, in either case without the Participant's
written consent.


                                   ARTICLE X
                              STOCKHOLDER RIGHTS

          A Participant (or a Permitted Transferee) shall have no rights as a
stockholder with respect to any Shares covered by an Award until he or she
shall have become the holder of record of such Share(s), and no adjustments

<PAGE>
                                                                            11

shall be made for dividends in cash or other property or distribution or other
rights in respect to any such Shares, except as otherwise specifically
provided for in this Plan.

                                  ARTICLE XI
               AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN

          The Board at any time may terminate or suspend the Plan, and from
time to time may amend or modify the Plan, provided that no amendment,
modification, or termination of the Plan shall in any manner adversely affect
any Award theretofore granted under the Plan, without the consent of the
Participant. Unless earlier terminated, the Plan shall terminate on December
31 of the tenth year following the year in which the Initial Public Offering
occurs.


                                  ARTICLE XII
                           MISCELLANEOUS PROVISIONS

          12.1 Nontransferability of Awards. No Award shall be assignable or
transferable except by will or the laws of descent and distribution; provided
that the Committee may permit (on such terms and conditions as it shall
establish) a Participant to transfer an Award for no consideration to the
Participant's child, stepchild, grandchild, parent, stepparent, grandparent,
spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including
adoptive relationships, any person sharing the Participant's household (other
than a tenant or employee), a trust in which these persons have more than
fifty percent of the beneficial interest, a foundation in which these persons
(or the Participant) control the management of assets, and any other entity in
which these persons (or the Participant) own more than fifty percent of the
voting interests ("Permitted Transferees"). Except to the extent required by
law, no right or interest of any Participant shall be subject to any lien,
obligation or liability of the Participant. All rights with respect to Awards
granted to a Participant under the Plan shall be exercisable during the
Participant's lifetime only by such Participant or, if applicable, his or her
Permitted Transferee(s). The rights of a Permitted Transferee shall be limited
to the rights conveyed to such Permitted Transferee, who shall be subject to
and bound by the terms of the agreement or agreements between the Participant
and the Company.

          12.2 Beneficiary Designation. Each Participant under the Plan may
from time to time name any beneficiary or beneficiaries (who may be named
contingently or successively) to whom any benefit under the Plan is to be paid
or by whom any right under the Plan is to be exercised in case of his death.
Each designation will revoke all prior designations by the same Participant,
shall be in a form prescribed by the Committee, and will be effective only
when filed by the Participant in writing with the Committee during his
lifetime. In the absence of any such designation, benefits remaining unpaid at
the Participant's death shall be paid to or exercised by the Participant's
surviving spouse, if any, or otherwise to or by his or her estate.

          12.3 No Guarantee of Employment or Participation. Nothing in the
Plan shall interfere with or limit in any way the right of the Company or any
Subsidiary to terminate any Participant's employment at any time, nor to
confer upon any Participant any right to continue in the employ of the Company
or any Subsidiary. No Employee shall have a right to be selected as a
Participant, or, having been so selected, to receive any future Awards.

          12.4 Tax Withholding. The Company shall have the right to deduct
from all amounts paid to a Participant in cash (whether under this Plan or
otherwise) any taxes required by law to be withheld in respect of Awards under
this Plan. In the case of any Award satisfied in the form of Shares, no shares
shall be issued unless and until arrangements satisfactory to the Committee
shall have been made to satisfy any withholding tax obligations applicable
with respect to such Award. Without limiting the generality of the foregoing,
the Company shall have the right to retain, or the Committee may, subject to
such terms and conditions as it may establish from time to time, permit
Participants to elect to tender, Shares (including Shares issuable in respect
of an Award) to satisfy, in whole or in part, the amount required to be
withheld (but no greater amount).

          12.5 Compliance with Legal and Exchange Requirements. The Plan, the
granting and exercising of Awards thereunder, and the other obligations of the
Company under the Plan, shall be subject to all applicable Federal and

<PAGE>
                                                                            12

State laws, rules, and regulations, and to such approvals by any regulatory or
governmental agency as may be required, and to any rules or regulations of any
exchange on which the Shares are listed. The Company, in its discretion, may
postpone the granting and exercising of Awards, the issuance or delivery of
Shares under any Award or any other action permitted under the Plan to permit
the Company, with reasonable diligence, to complete such stock exchange
listing or registration or qualification of such Shares or other required
action under any Federal or State law, rule, or regulation and may require any
Participant to make such representations and furnish such information as it
may consider appropriate in connection with the issuance or delivery of Shares
in compliance with applicable laws, rules, and regulations. The Company shall
not be obligated by virtue of any provision of the Plan to recognize the
exercise of any Award or to otherwise sell or issue Shares in violation of any
such laws, rules, or regulations; and any postponement of the exercise or
settlement of any Award under this provision shall not extend the term of such
Awards, and neither the Company nor its directors or officers shall have any
obligation or liability to the Participant with respect to any Award (or
Shares issuable thereunder) that shall lapse because of such postponement.

          12.6 Indemnification. Each person who is or shall have been a member
of the Committee or of the Board shall be indemnified and held harmless by the
Company against and from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by him in connection with or resulting
from any claim, action, suit, or proceeding to which he may be made a party or
in which he may be involved by reason of any action taken or failure to act
under the Plan and against and from any and all amounts paid by him in
settlement thereof, with the Company's approval, or paid by him in
satisfaction of any judgment in any such action, suit, or proceeding against
him, provided he shall give the Company an opportunity, at its own expense, to
handle and defend the same before he undertakes to handle and defend it on his
own behalf. The foregoing right of indemnification shall not be exclusive and
shall be independent of any other rights of indemnification to which such
persons may be entitled under the Company's Articles of Incorporation or
By-laws, by contract, as a matter of law, or otherwise.

          12.7 Legend. To the extent any stock certificate is issued to a
Participant in respect of shares of Restricted Stock prior to the expiration
of the Period of Restriction, such certificate shall be registered in the name
of the Participant and shall bear the following (or similar) legend:

          "The shares of stock represented by this certificate are subject to
the terms and conditions contained in the 1999 Neuberger Berman Inc. Long-Term
Incentive Plan and the Award Agreement, dated as of _____________, between the
Company and the Participant, and may not be sold, pledged, transferred,
assigned, hypothecated or otherwise encumbered in any manner (except as
provided in Section 12.1 of the Plan or in such Award Agreement) until
_______________."

Upon the lapse of the Period of Restriction with respect to such Restricted
Stock, the Company shall issue or have issued in exchange for those
certificates previously issued new share certificates without the legend
described herein in respect of any shares that have become vested.

          12.8 Effective Date. The Plan shall be effective as of the date of
the Initial Public Offering.

          12.9 No Limitation on Compensation. Nothing in the Plan shall be
construed to limit the right of the Company to establish other plans or to pay
compensation to its employees, in cash or property, in a manner which is not
expressly authorized under the Plan.

          12.10 Deferrals. The Committee may postpone the exercising of
Awards, the issuance or delivery of Stock under any Award or any action
permitted under the Plan to prevent the Company or any Subsidiary from being
denied a Federal income tax deduction with respect to any Award other than an
ISO.

          12.11 Governing Law. The Plan shall be construed in accordance with
and governed by the laws of the State of New York, without reference to
principles of conflict of laws which would require application of the law of
another jurisdiction, except to the extent that the corporate law of the State
of Delaware specifically and mandatorily applies.

<PAGE>
                                                                            13

          12.12 No Impact on Benefits. Except as may otherwise be specifically
stated under any employee benefit plan, policy or program, no amount payable
in respect of any Award shall be treated as compensation for purposes of
calculating an Employee's right under any such plan, policy or program.

          12.13 No Constraint on Corporate Action. Nothing in this Plan shall
be construed (A) to limit, impair or otherwise affect the Company's right or
power to make adjustments, reclassifications, reorganizations or changes of
its capital or business structure, or to merge or consolidate, or dissolve,
liquidate, sell, or transfer all or any part of its business or assets or (B)
to limit the right or power of the Company, or any Subsidiary to take any
action which such entity deems to be necessary or appropriate.

          12.14 Headings and Captions. The headings and captions herein are
provided for reference and convenience only, shall not be considered part of
this Plan, and shall not be employed in the construction of this Plan.


<PAGE>

                                                                 EXHIBIT 5.1

                         LEHMAN BROTHERS HOLDINGS INC.
                                399 Park Avenue
                           New York, New York 10022

                               October 31, 2003


Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549

Ladies and Gentlemen:

         I am a Vice President and Associate General Counsel of Lehman
Brothers Holdings Inc., a Delaware corporation (the "Company"). A Registration
Statement on Form S-8 (the "Registration Statement"), under the Securities Act
of 1933, as amended (the "Securities Act"), is being filed concurrently
herewith by the Company with the Securities and Exchange Commission (the
"SEC"). The Registration Statement relates to the registration of 5,944,642
shares of authorized and unissued or issued Common Stock (the "Shares") to be
distributed from time to time to certain employees of the Company under the
1999 Neuberger Berman Inc. Long-Term Incentive Plan, as amended (the "Plan").

         In that connection, I or members of my staff have examined or relied
upon originals or copies, certified or otherwise identified to our
satisfaction, of such documents, corporate records, certificates and
instruments relating to the Company as I have deemed relevant and necessary to
the formation of the opinion hereinafter set forth. In such examination, I
have assumed the genuineness and authenticity of all documents examined by me
or members of my staff and all signatures thereon, the legal capacity of all
persons executing such documents, the conformity to originals of all copies of
documents submitted to us and the truth and correctness of any representations
and warranties contained therein.

         Based upon the foregoing, I am of the opinion that the issuance by
the Company of the Shares has been duly authorized, and when the Shares are
duly issued in accordance with the terms of the Plan, such Shares will be
validly issued, fully paid and nonassessable.

         In rendering this opinion, I express no opinion as to the laws of any
jurisdiction other than the State of New York, the General Corporation Law of
the State of Delaware and the United States of America.

         I hereby consent to the filing of this opinion (and this consent) as
an exhibit to the Registration Statement, without admitting that I am an
"expert" under the Securities Act, or the rules and regulations of the SEC
issued thereunder, with respect to any part of the Registration Statement,
including this exhibit.

                                  Very truly yours,

                                  /s/ OLIVER BUDDE
                                  --------------------
                                  Oliver Budde
                                  Vice President and Associate General Counsel


<PAGE>

                                                                  EXHIBIT 23.2


                        CONSENT OF INDEPENDENT AUDITORS

         We consent to the incorporation by reference in this Registration
Statement (Form S-8) of Lehman Brothers Holdings Inc. (the "Company") for the
registration of shares of the Company's Common Stock, par value $0.10 per
share, pertaining to the 1999 Neuberger Berman Inc. Long-Term Incentive Plan,
as amended, of our report dated January 10, 2003, with respect to the
consolidated financial statements and schedule of the Company incorporated by
reference in its Annual Report (Form 10-K) for the year ended November 30, 2002
and the related financial statement schedule included therein, filed with the
Securities and Exchange Commission.


                                              /S/ ERNST & YOUNG LLP
                                             ---------------------------
                                             Ernst & Young LLP

New York, New York
October 31, 2003
[{"type": "S-8", "sequence": "1", "filename": "longtermplanform_s-8.txt", "description": "LONG-TERM INCENTIVE PLAN", "secsgml_size_bytes": 82805}]
{"company-data": {"conformed-name": "LEHMAN BROTHERS HOLDINGS INC", "cik": "0000806085", "assigned-sic": "6211", "irs-number": "133216325", "state-of-incorporation": "DE", "fiscal-year-end": "1130"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-110180", "film-number": "03971204"}, "business-address": {"street1": "LEHMAN BROTHERS", "street2": "745 SEVENTH AVENUE", "city": "NEW YORK", "state": "NY", "zip": "10019", "phone": "2125267000"}, "mail-address": {"street1": "LEHMAN BROTHERS", "street2": "745 SEVENTH AVENUE", "city": "NEW YORK", "state": "NY", "zip": "10019"}, "former-company": {"former-conformed-name": "SHEARSON LEHMAN HUTTON HOLDINGS INC", "date-changed": "19901017"}}
Registration Statement No. 333-

                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                   FORM S-8
                            REGISTRATION STATEMENT
                                     UNDER
                          THE SECURITIES ACT OF 1933

                         LEHMAN BROTHERS HOLDINGS INC.
            (Exact Name of Registrant as Specified in Its Charter)

                 Delaware                           13-3216325
    (State or other jurisdiction of              (I.R.S. employer
     incorporation or organization)           identification number)

                              745 Seventh Avenue
                           New York, New York 10019
                   (Address of principal executive offices)

        1999 NEUBERGER BERMAN INC. LONG-TERM INCENTIVE PLAN, AS AMENDED
                           (Full title of the plan)

                             Thomas A. Russo, Esq.
                              745 Seventh Avenue
                           New York, New York 10019
                    (Name and address of agent for service)

                                (212) 526-7000
         (Telephone number, including area code, of agent for service)

                                   Copy to:
                           Jeffrey A. Welikson, Esq.
                         Lehman Brothers Holdings Inc.
                          399 Park Avenue, 11th Floor
                           New York, New York 10022
2

                        CALCULATION OF REGISTRATION FEE
Title of Securities to be Registered                      Amount to       Proposed Maximum    Proposed Maximum      Amount of
                                                      be Registered (1)  Offering Price per  Aggregate Offering  Registration Fee
                                                                              Unit (2)           Price (2)
Common Stock, $.10 par value                              2,923,469           $70.67            $206,601,554.23       $16,714.07

                                                          3,021,173           $95.77            $289,337,738.21       $23,407.42

Total                                                     5,944,642           $166.44           $495,939,292.44       $40,121.49(3)
(1) This Registration Statement registers the issuance of 5,944,642 shares of
common stock of Lehman Brothers Holdings Inc. (the "Registrant"), par value
$0.10 (the "Common Stock"). Such number of shares represents the aggregate
number of shares issuable pursuant to the 1999 Neuberger Berman Inc. Long-Term
Incentive Plan, as amended, as follows: (A) 2,923,469 shares available for
issuance pursuant to future share and/or stock option awards, and (B) 3,021,173
shares subject to outstanding options previously granted.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to the provisions of Rule 457(c) and (h) of the Securities Act of
1933, as amended (the "Securities Act"), based upon (A) the average of the
high and low prices per share of the Registrant's Common Stock, as reported on
the New York Stock Exchange on October 29, 2003 ($70.67) for 2,923,469 shares
available for issuance pursuant to future share and/or stock option awards,
and (B) the weighted average exercise price per share ($95.77) for 3,021,173
shares subject to outstanding options previously granted.
(3) The total filing fee for Common Stock registered herein of $40,121.49 is
offset pursuant to Rule 457(p) of the Securities Act by filing fees
previously paid with respect to unsold shares registered pursuant to
registration statements on Form S-8 filed by Neuberger Berman Inc., a wholly
owned subsidiary of the Registrant, on September 1, 2000 for the
Neuberger Berman Inc. Employee Stock Purchase Plan and the Neuberger Berman
Inc. Wealth Accumulation Plan (Registration No. 333-45058); and on October 7,
1999 for the 1999 Neuberger Berman Inc. Directors Stock Incentive Plan,
the 1999 Neuberger Berman Inc. Annual Incentive Plan, 1999 Neuberger Berman
Inc. Long-Term Incentive Plan, 1999 Neuberger Berman Inc. Deferred
Compensation Plan, and Neuberger Berman Inc. Employee Defined Contribution
Stock Incentive Plan (Registration No. 333-88579).

                               EXPLANATORY NOTE

         Pursuant to the terms of the Agreement and Plan of Merger dated as of
July 21, 2003, as amended by the First Amendment to Agreement and Plan of
Merger, dated as of September 22, 2003 (the "Merger Agreement"), Neuberger
Berman Inc. ("Neuberger") has merged with and into Ruby Acquisition Company
(the "Merger"), a direct wholly owned subsidiary of the Registrant, and is now
a direct wholly owned subsidiary of the Registrant.

         Pursuant to the Merger Agreement, the Registrant assumed the
obligations of Neuberger under the 1999 Neuberger Berman Inc. Long-Term
Incentive Plan, as amended. Shares issuable under the plan were originally
registered by Neuberger on Form S-8, Registration No. 333-88579. The number of
shares subject to outstanding awards or rights under the plans as of the
closing of the Merger has been recalculated pursuant to exchange ratios set
forth in the Merger Agreement.
3

                                    PART I
             INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS

ITEM 1. PLAN INFORMATION

          Not filed as part of this Registration Statement pursuant to Note to
Part I of Form S-8.

ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION

          Not filed as part of this Registration Statement pursuant to Note to
Part I of Form S-8.

                                    PART II
              INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE

         The following documents previously filed by the Registrant with the
Securities and Exchange Commission (the "SEC") pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act") are hereby incorporated
by reference in this Registration Statement:

         (1) The Registrant's Annual Report on Form 10-K for the fiscal year
ended November 30, 2002, filed with the SEC on February 28, 2003;

         (2) The Registrant's Quarterly Report on Form 10-Q for the quarterly
period ended February 28, 2003 filed with the SEC on April 14, 2003; for the
quarterly period ended May 31, 2003 filed with the SEC on July 15, 2003 and
for the quarterly period ended August 31, 2003, filed with the SEC on October
15, 2003;

         (3) The Registrant's Current Reports on Form 8-K, filed with the SEC
on each of December 11, December 19 and December 23 (two filings), 2002, and
January 9, March 17, March 20, March 21, April 29, May 1, May 2, May 8 (two
filings), May 13, May 20, May 27, June 2, June 19, June 24, July 1, July 10,
July 14, July 22, August 26, August 27, September 10, September 16, September
2, October 8 and October 31, 2003 (two filings); and

         (4) The description of the Registrant's Common Stock, as contained in
the Registrant's Form 8-A Registration Statement, filed with the SEC on
April 29, 1994.

         In addition, all documents filed by the Registrant pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date
of this Registration Statement and prior to the filing of a post-effective
amendment which indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference into this Registration Statement and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained herein or in any
subsequently filed document which also is incorporated or deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Registration Statement.

ITEM 4. DESCRIPTION OF SECURITIES

         Not applicable.
4

ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL

          Oliver Budde, Vice President and Associate General Counsel of the
Registrant, has rendered an opinion to the effect that, under applicable state
law, the shares of Common Stock to which this Registration Statement relates
will be, when issued, validly issued, fully paid and nonassessable.

ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS

          The Restated Certificate of Incorporation of the Registrant
authorizes the Registrant to indemnify its directors and officers to the
fullest extent permitted by Delaware General Corporation Law from time to
time. In addition, the directors of the Registrant are insured under officers'
and directors' liability insurance policies purchased by the Registrant.

          Section 145 of the Delaware General Corporation Law provides for
indemnification of directors and officers in certain circumstances, which may
include indemnification for liabilities arising under the Securities Act.

ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED

          Not applicable.

ITEM 8. EXHIBITS

          The Exhibit Index beginning on page 7 is hereby incorporated by
reference.

ITEM 9. UNDERTAKINGS

(a) The undersigned Registrant hereby undertakes:

          (1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:

                    (i) To include any prospectus required by Section 10(a)(3)
          of the Securities Act;

                    (ii) To reflect in the prospectus any facts or events
          arising after the effective date of this Registration Statement (or
          the most recent post-effective amendment thereof) which,
          individually or in the aggregate, represent a fundamental change in
          the information set forth in this Registration Statement.
          Notwithstanding the foregoing, any increase or decrease in volume of
          securities offered (if the total dollar value of securities offered
          would not exceed that which was registered) and any deviation from
          the low or high end of the estimated maximum offering range may be
          reflected in the form of prospectus filed with the SEC pursuant to
          Rule 424(b) if, in the aggregate, the changes in volume and price
          represent no more than a 20 percent change in the maximum aggregate
          offering price set forth in the "Calculation of Registration Fee"
          table in the effective registration statement; and

                    (iii) To include any material information with respect to
          the plan of distribution not previously disclosed in this
          Registration Statement or any material change to such information in
          this Registration Statement; provided, however, that the
          undertakings set forth in paragraphs (i) and (ii) above do not apply
          if this Registration Statement is on Form S-3, Form S-8 or Form F-3,
          and the information required to be included in a post-effective
          amendment by those paragraphs is contained in periodic reports filed
          with or furnished to the SEC by the Registrant pursuant to Section
          13 or 15(d) of the Exchange Act that are incorporated by reference
          in this Registration Statement.
5

          (2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.

          (3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.

(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.

(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the SEC such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.
6

                                SIGNATURE PAGE

          Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, State of New York, on
October 31, 2003.

                                          LEHMAN BROTHERS HOLDINGS INC.

                                          By:         /s/ Oliver Budde
                                              --------------------------------
                                              Name:   Oliver Budde
                                              Title:  Vice President

          Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
Signature                                  Title                                Date
*                                   Chairman and                      October 31, 2003
------------------------------------------        Chief Executive Officer
           Richard S. Fuld, Jr.

                    *                                     Director                        October 31, 2003
------------------------------------------
            Michael L. Ainslie

                    *                                     Director                        October 31, 2003
------------------------------------------
              John F. Akers

                    *                                     Director                        October 31, 2003
------------------------------------------
             Roger S. Berlind

                    *                                     Director                        October 31, 2003
------------------------------------------
           Thomas H. Cruikshank

                    *                                     Director                        October 31, 2003
------------------------------------------
              Henry Kaufman

                    *                                     Director                        October 31, 2003
------------------------------------------
             John D. Macomber

                    *                                     Director                        October 31, 2003
------------------------------------------
               Dina Merrill
* By: /s/ Jeffrey A. Welikson
     ----------------------------
        Jeffrey A. Welikson
        Attorney-in-Fact
7

                                 EXHIBIT INDEX

Exhibit                     Description of Exhibit
Number

4.1   --  1999 Neuberger Berman Inc. Long-Term Incentive Plan, as amended.

5.1   --  Opinion (and consent) of Oliver Budde, Vice President and Associate
          General Counsel of Lehman Brothers Holdings Inc., as to the validity
          of the shares of Common Stock to which this Registration Statement
          relates.

23.1  --  Consent of Oliver Budde, Vice President and Associate General
          Counsel of Lehman Brothers Holdings Inc. (included in Exhibit 5.1).

23.2  --  Consent of Ernst & Young, LLP, Independent Auditors.

24.1  --  Power of Attorney (incorporated by reference to Exhibit 24.1 of the
          Registrant's Form S-4 Registration Statement, filed with the SEC on
          August 15, 2003 (Registration No. 333-108025)).
EXHIBIT 4.1

                                AMENDMENT NO. 2
                                    TO THE
                          1999 NEUBERGER BERMAN INC.
                           LONG-TERM INCENTIVE PLAN

          WHEREAS, in connection with the merger of Neuberger Berman Inc.
("Neuberger") with and into Ruby Acquisition Company (the "Merger"), as set
forth in the Agreement and Plan of Merger dated as of July 21, 2003, as
amended by the First Amendment to Agreement and Plan of Merger, dated as of
September 22, 2003, among Lehman Brothers Holdings Inc., Ruby Acquisition
Company and Neuberger (the "Merger Agreement"), it is necessary to amend
certain of the stock incentive plans maintained by Neuberger.

          NOW, THEREFORE, pursuant to Article XI of the 1999 Neuberger Berman
Inc. Long-Term Incentive Plan (the "Plan") and resolutions of the Board of
Directors of Neuberger dated October 31, 2003, the Plan is hereby amended,
effective as of October 31, 2003, as follows:

1.     The definition of the term "Board" as set forth in Section 2.1 of the
Plan is hereby amended by deleting the current definition and replacing it with
the following:

          ""Board" means the Board of Directors of Lehman Brothers Holdings
          Inc."

2.     The definition of the term "Common Stock" as set forth in Section 2.1
of the Plan is hereby amended by deleting the current definition and replacing
it with the following:

          ""Common Stock" means the common stock of Lehman Brothers Holdings
          Inc., par value $0.10 per share."

3.     The definition of the term "Company" as set forth in Section 2.1 of the
Plan is hereby amended by deleting the current definition and replacing it
with the following:

          ""Company" means Lehman Brothers Holdings Inc."

4.     The definition of the term "Employee" as set forth in Section 2.1 of the
Plan is hereby amended by deleting the current definition and replacing it
with the following:

          ""Employee" means any officer or employee of Neuberger Berman Inc.
          or any of its subsidiaries, as applicable."

5.     The definition of the term "Initial Public Offering" as set forth in
Section 2.1 of the Plan is hereby amended by deleting the current definition
and replacing it with the following:

          ""Initial Public Offering" means the first offering of common stock
          of Neuberger Berman Inc. to the general public pursuant to an
          underwritten public offering effective August 2, 1999."

6.     The definition of the term "Participant" as set forth in Section 2.1 of
the Plan is hereby amended by deleting the current definition and replacing it
with the following:

          "Participant" means any Employee, prospective Employee, director,
          consultant or advisor to Neuberger Berman Inc. or any of its
          subsidiaries, as applicable, who, as of October 31, 2003, had
          previously been designated as a Participant by the compensation
          committee of Neuberger Berman Inc. and received Awards, or any
          prospective employee of the Company or any of its Subsidiaries
          otherwise designated by the Committee to receive an Award under the
          Plan.
2

7.     The reference to the number of Shares available for Awards (as defined
in the Plan) under the Plan contained in Section 4.1 of the Plan is hereby
amended by deleting the number "10,000,000" and replacing it with the
following number (rounded to the nearest whole share), which reflects, in
accordance with Section 4.3 of the Plan, among other things, the effect of the
Merger and the application of the Exchange Ratio and the Special Option
Exchange Ratio (as such terms are defined in the Merger Agreement) on the
number of shares of Neuberger common stock subject to applicable outstanding
Awards as of the Effective Time (as defined in the Merger Agreement) and which
includes such number of Shares to be subject to Awards to be granted in
connection with the Merger: 5,944,642.

8.     Section 5.5 of the Plan is hereby amended as follows:

          (a) The first sentence of Section 5.5 is hereby amended by adding
the word "not" after the phrase "The Company may" in the first line of such
sentence.

          (b) The second sentence of Section 5.5 is hereby deleted in its
entirety.

          All other provisions of the Plan shall remain in full force and
effect, except to the extent modified by the foregoing.
AMENDMENT NO. 1
                                    TO THE
                          1999 NEUBERGER BERMAN INC.
                           LONG-TERM INCENTIVE PLAN

          This Amendment No. 1 (the "Amendment") to the 1999 Neuberger Berman
Inc. Long-Term Incentive Plan (the "Plan") is made effective as of this 18th
day of July, 2000.

          Pursuant to resolutions of the Board of Directors (the "Board") of
Neuberger Berman Inc. (the "Company") dated July 18, 2000, the Plan is hereby
amended as follows:

          The definition of the term "Change in Control" in Section 2.1 of the
Plan is hereby amended to read as follows:

          "Change in Control" means the occurrence of any of the following
events:

                    (a) the members of the Board at the beginning of any
          consecutive twenty-four calendar month period (the "Incumbent
          Directors") cease for any reason other than due to death to
          constitute at least a majority of the members of the Board, provided
          that any director whose election, or nomination for election by the
          Company's stockholders, was approved by a vote of at least a
          majority of the members of the Board then still in office who were
          members of the Board at the beginning of such twenty-four calendar
          month period other than as a result of a proxy contest, or any
          agreement arising out of an actual or threatened proxy contest,
          shall be treated as an Incumbent Director; or

                    (b) any "person", including a "group" (as such terms are
          used in Sections 13(d) and 14(d)(2) of the Act), but excluding the
          Company, any Subsidiary or any employee benefit plan of the Company
          or any Subsidiary becomes the "beneficial owner" (as defined in Rule
          13(d)-3 under the Act), directly or indirectly, of securities of the
          Company representing 50% or more of the combined voting power of the
          Company's then outstanding securities; or

                    (c) the stockholders of the Company shall approve a
          definitive agreement (i) for the merger or other business
          combination of the Company with or into another corporation, a
          majority of the directors of which were not directors of the Company
          immediately prior to the merger and in which the stockholders of the
          Company immediately prior to the effective date of such merger own a
          percentage of the voting power in such corporation that is less than
          one-half of the percentage of the voting power they owned in the
          Company immediately prior to such transaction or (ii) for the sale
          or other disposition of all or substantially all of the assets of
          the Company to any other entity; provided, in each case, that such
          transaction shall have been consummated; or

                    (d) the purchase of Common Stock pursuant to any tender or
          exchange offer made by any "person", including a "group" (as such
          terms are used in Sections 13(d) and 14(d)(2) of the Act), other
          than the Company, any Subsidiary, or an employee benefit plan of the
          Company or any Subsidiary, for 50% or more of the Common Stock of
          the Company.

          Notwithstanding the foregoing, a "Change in Control" shall not be
deemed to occur in the event the Company files for bankruptcy, liquidation or
reorganization under the United States Bankruptcy Code."

          Except as expressly provided herein, the terms and conditions of the
Plan shall remain unchanged.
1999 NEUBERGER BERMAN INC.
                           LONG-TERM INCENTIVE PLAN

                                   ARTICLE I
                                   PURPOSES

          The purposes of the 1999 Neuberger Berman Inc. Long-Term Incentive
Plan (the "Plan") is to foster and promote the long-term financial success of
the Company and materially increase shareholder value by (A) motivating
superior performance by means of performance-related incentives, (B)
encouraging and providing for the acquisition of an ownership interest in the
Company by Employees and (C) enabling the Company to attract and retain the
services of outstanding employees upon whose judgment, interest and special
effort the successful conduct of its operations is largely dependent.

                                  ARTICLE II
                                  DEFINITIONS

          2.1 Certain Definitions. Capitalized terms used herein without
definition shall have the respective meanings set forth below:

          "Act" means the Securities Exchange Act of 1934, as amended.

          "Adjustment Event" means any stock dividend, stock split, share
combination, extraordinary cash dividend, recapitalization, reorganization,
merger, consolidation, split-up, spin-off, combination, exchange of shares or
other similar event affecting the Common Stock of the Company.

          "Award" means any Option, Restricted Stock, Restricted Unit,
Incentive Stock, Incentive Unit, Deferred Share, Supplemental Unit or any
combination thereof, including Awards combining two or more types of Awards in
a single grant.

          "Board" means the Board of Directors of the Company.

          "Cause" means any of:

          (a) the Participant's having been convicted of, or entered a plea of
Nolo Contendere to, a crime that constitutes a felony or a misdemeanor
involving fraud, false statements or misleading omissions, perjury,
embezzlement, bribery, forgery or counterfeiting or other similar crime (or an
equivalent charge in jurisdictions that do not use such designations);

          (b) the willful failure by the Participant (other than due to
physical or mental illness) to perform substantially his duties as an employee
of the Company or any Subsidiary after reasonable notice to the Participant of
such failure;

          (c) the Participant's violation of any securities or commodities
laws, any rules or regulations issued pursuant to such laws, or the rules and
regulations of any securities or commodities exchange or association of which
the Company or any of its Subsidiaries or affiliates is a member;

          (d) the Participant's violation of any Company policy concerning
hedging or confidential or proprietary information, or material violation of
any other Company policy as in effect from time to time;

          (e) the Participant's engaging in any act or making any statement
which impairs, impugns, denigrates, disparages or negatively reflects upon the
name, reputation or business interests of the Firm; or
2

          (f) the Participant's engaging in any conduct that is injurious to
the Company or any Subsidiary; or

          (g) the breach by the Participant of any written covenant or
agreement with the Company or any Subsidiary not to disclose any information
pertaining to the Company or any Subsidiary or not to compete or interfere
with the Company or any Subsidiary.

          The determination as to whether "Cause" has occurred shall be made
by the Committee. The Committee shall also have the authority to waive the
consequences under the Plan of the existence or occurrence of any of the
events, acts or omissions constituting "Cause."

          "Change in Control" means the occurrence of any of the following
events:

               (a) the members of the Board at the beginning of any consecutive
twenty-four calendar month period (the "Incumbent Directors") cease for any
reason other than due to death to constitute at least a majority of the
members of the Board, provided that any director whose election, or nomination
for election by the Company's stockholders, was approved by a vote of at least
a majority of the members of the Board then still in office who were members
of the Board at the beginning of such twenty-four calendar month period other
than as a result of a proxy contest, or any agreement arising out of an actual
or threatened proxy contest, shall be treated as an Incumbent Director; or

               (b) any "person," including a "group" (as such terms are used in
Sections 13(d) and 14(d)(2) of the Act), but excluding the Company, any
Subsidiary or any employee benefit plan of the Company or any Subsidiary
becomes the "beneficial owner" (as defined in Rule 13(d)-3 under the Act),
directly or indirectly, of securities of the Company representing 20% or more
of the combined voting power of the Company's then outstanding securities; or

               (c) the stockholders of the Company shall approve a definitive
agreement (I) for the merger or other business combination of the Company with
or into another corporation, a majority of the directors of which were not
directors of the Company immediately prior to the merger and in which the
stockholders of the Company immediately prior to the effective date of such
merger own a percentage of the voting power in such corporation that is less
than one-half of the percentage of the voting power they owned in the Company
immediately prior to such transaction or (II) for the sale or other
disposition of all or substantially all of the assets of the Company to any
other entity; provided, in each case, that such transaction shall have been
consummated; or

               (d) the purchase of Common Stock pursuant to any tender or
exchange offer made by any "person," including a "group" (as such terms are
used in Sections 13(d) and 14(d)(2) of the Act), other than the Company, any
Subsidiary, or an employee benefit plan of the Company or any Subsidiary, for
20% or more of the Common Stock of the Company.

          Notwithstanding the foregoing, a "Change in Control" shall not be
deemed to occur in the event the Company files for bankruptcy, or
reorganization under the United States Bankruptcy Code.

          "Change in Control Price" means the highest price per Share offered
in conjunction with any transaction resulting in a Change in Control (as
determined in good faith by the Committee (as constituted before the Change in
Control) if any part of the offered price is payable other than in cash) or,
in the case of a Change in Control occurring solely by reason of a change in
the composition of the Board, the highest Fair Market Value of the Stock on
any of the 30 trading days immediately preceding the date on which a Change in
Control occurs.

          "Code" means the Internal Revenue Code of 1986, as amended, and the
regulations thereunder.

          "Committee" means the Compensation Committee of the Board, or when
section 162(m) of the Code or Rule 16b promulgated under the Act would require
action to be taken by a committee of "outside directors" or "Non-Employee
Directors," as the case may be, the "Committee" shall be deemed to refer to a
subcommittee of the Compensation Committee that consist of two or more
3

members meeting such requirements, or the full Board in the absence of such
a subcommittee.

          "Common Stock" means the common stock of the Company, par value
$0.01 per share.

          "Company" means Neuberger Berman Inc., a Delaware corporation, any
successor thereto.

          "Deferred Share" means the deferred share units that confer upon a
Participant the right to receive shares of Common Stock at the end of a
specified deferral period as set forth in Article VIII .

          "Disability" means a total disability within the meaning of any
long-term disability plan maintained for the benefit of the Participant or, if
the Participant is not covered by such a disability plan, then as determined
by the Committee.

          "Dividend Equivalents" means dividends paid by the Company with
respect to Shares corresponding to Awards awarded under the Plan.

          "Employee" means any officer or employee of the Company or any
Subsidiary.

          "Executive Officer" means those persons who are officers of the
Company within the meaning of Rule 16a-1(f) promulgated under the Act.

          "Fair Market Value" means, as of any date of determination, the
closing price of a Share on the New York Stock Exchange (or on such other
recognized market or quotation system on which the trading prices of Common
Stock are traded or quoted at the relevant time). In the event that there are
no Common Stock transactions reported on such exchange or system on such date,
Fair Market Value shall mean the closing price of a Share on the immediately
preceding day on which Common Stock transactions were so reported.
Notwithstanding the foregoing, with respect to any Award which becomes
effective upon the closing of the Initial Public Offering, Fair Market Value
shall mean the initial price at which a Share is offered to the public
pursuant to the Initial Public Offering.

          "Incentive Stock" shall mean an award of Common Stock that is
forfeitable until the completion of specified Performance Criteria as provided
for in Section 7.1.

          "Incentive Unit" shall mean a contractual right to receive Common
Stock (or cash based on the Fair Market Value of Common Stock) until the
completion of specified Performance Criteria as provided for in Section 7.1.

          "Initial Public Offering" shall mean the first offering of the
Common Stock to the general public pursuant to an underwritten public
offering.

          "Normal Retirement" means a termination of the Participant's
employment under circumstances that the Committee determines as qualifying as
retirement at normal retirement age for purposes of the Plan and not
inconsistent with the treatment of the Participant under other Company plans.

          "Option" means the right to purchase Common Stock at a stated price
for a specified period of time.

          "Participant" means any director, Employee, or prospective Employee
of, or any consultant or advisor to, the Company designated by the Committee
to receive an Award under the Plan.

          "Performance Period" means each calendar year or multi-year cycle as
determined by the Committee.

          "Period of Restriction" means the period during which a Restricted
Stock or Restricted Unit is subject to forfeiture.
4

          "Plan" means this 1999 Neuberger Berman Inc. Long-Term Incentive
Plan, as the same may be amended from time to time.

          "Qualifying Termination of Employment" means a termination of a
Participant's employment with the Company or any of its Subsidiaries by reason
of the Participant's death, Disability, early retirement with the consent of
the Committee or Normal Retirement.

          "Restricted Stock" means an award of Common Stock made pursuant to
Section 6.1 that is forfeitable by the Participant until the completion of a
specified period of future service or until otherwise determined by the
Committee or in accordance with the terms of the Plan.

          "Restricted Unit" means a contractual right to receive Common Stock,
or cash based on the Fair Market Value of Common Stock, made pursuant to
Section 6.1 that is forfeitable by the Participant until the completion of a
specified period of future service or until otherwise determined by the
Committee or in accordance with the terms of the Plan.

          "Retirement" means termination of a Participant's employment on or
after the Normal Retirement Date or, with the Committee's approval, on or
after any early retirement date established under any retirement plan
maintained by the Company, or any Subsidiary in which the Participant
participates.

          "Share" means a share of Common Stock.

          "Subsidiary" means any corporation in which the Company owns,
directly or indirectly, stock representing 50% or more of the voting power of
all classes of stock entitled to vote and any other business organization,
regardless of form, in which the Company possesses directly or indirectly 50%
or more of the total combined equity interests in such organization.

          2.2 Additional Definitions.

          "Alternative Award" has the meaning given in Section 9.2.

          "Deferred Amount" has the meaning given in Section 8.1.

          "ISOs" has the meaning given in Section 5.1.

          "NSOs" has the meaning given in Section 5.1.

          "Performance Restriction" has the meaning given in Section 7.2(a).

          "Permitted Transferees" has the meaning given in Section 12.1.

          "Reload Options" has the meaning given in Section 5.4.

          "Supplemental Unit" has the meaning given in Section 8.1.

          2.3 Gender and Number. Except when otherwise indicated by the
context, words in the masculine gender used in the Plan shall include the
feminine gender, the singular shall include the plural, and the plural shall
include the singular.
5

                                  ARTICLE III
                            POWERS OF THE COMMITTEE

          3.1 Power to Grant. The Committee shall determine the Participants
to whom Awards shall be granted, the type or types of Awards to be granted and
the terms and conditions of any and all such Awards. The Committee may
establish different terms and conditions for different types of Awards, for
different Participants receiving the same type of Award and for the same
Participant for each Award such Participant may receive, whether or not
granted at different times.

          3.2 Administration. The Committee shall be responsible for the
administration of the Plan, including, without limitation, determining which
Participants receive Awards, what kind of Awards are made under the Plan and
for what number of shares, and the other terms and conditions of each such
Award. The Committee shall have the responsibility of construing and
interpreting the Plan and of establishing and amending such rules and
regulations as it may deem necessary or desirable for the proper
administration of the Plan. Any decision or action taken or to be taken by the
Committee, arising out of or in connection with the construction,
administration, interpretation and effect of the Plan and of its rules and
regulations, shall, to the greatest extent permitted by applicable law, be
within its absolute discretion (except as otherwise specifically provided
herein) and shall be conclusive and binding upon the Company and its
Subsidiaries, all Participants and any person claiming under or through any
Participant. No term of this Plan relating to ISOs shall be interpreted,
amended or altered, nor shall any discretion or authority granted under the
Plan be so exercised, so as to disqualify the Plan under section 422 of the
Code.

          3.3 Delegation by the Committee. The Committee may delegate its
authority under this Plan; provided that the Committee shall in no event
delegate its authority with respect to the compensation of the Chief Executive
Officer of the Company, the four most highly compensated executive officers
(as determined under Section 162(m) of the Code and regulations thereunder) of
the Company and any other individual whose compensation the Board or Committee
reasonably believes may become subject to Section 162(m) of the Code.

                                  ARTICLE IV
                             STOCK SUBJECT TO PLAN

          4.1 Number. Subject to the provisions of this Article IV, the number
of Shares subject to Awards under the Plan may not exceed 10,000,000 Shares,
plus any Shares that, after the effective date of the Plan, become available
for Awards under this Plan in accordance with Section 4.2 below. Without
limiting the generality of the foregoing, whenever Shares are received by the
Company in connection with the exercise of or payment for any Award granted
under the Plan only the net number of Shares actually issued shall be counted
against the foregoing limit. The Shares to be delivered under the Plan may
consist, in whole or in part, of treasury stock or authorized but unissued
Common Stock not reserved for any other purpose.

          4.2. Canceled, Terminated, or Forfeited Awards. Any Shares subject
to any Award granted hereunder which for any reason is canceled, terminated or
otherwise settled without the issuance of any Common Stock after the effective
date of this Plan shall be available for further Awards under the Plan.

          4.3. Adjustment in Capitalization. In the event of any Adjustment
Event such that an adjustment is required to preserve, or to prevent
enlargement of, the benefits or potential benefits made available under this
Plan, then the Committee shall, in such manner as the Committee shall deem
equitable, adjust any or all of (A) the number and kind of Shares which
thereafter may be awarded or optioned and sold under the Plan (including,
without termination, adjusting the limits on the number and types of certain
Awards that may be made under the Plan), (B) the number and kinds of Shares
subject to outstanding Options and other Awards and (C) the grant, exercise or
conversion price with respect to any of the foregoing. In addition, the
Committee may make provisions for a cash payment to a Participant or a person
who has an outstanding Option or other Award. The number of Shares subject to
any Option or other Award shall always be a whole number.
6
                                   ARTICLE V
                                 STOCK OPTIONS

          5.1 Grant of Options. The Committee shall have the power to grant
Options that are "incentive stock options" within the meaning of section 422
of the Code ("ISOs") or that are non-statutory stock options ("NSOs") to any
Participant and to determine (A) the number of ISOs and the number of NSOs to
be granted to each Participant and (B) the other terms and conditions of such
Awards. An Option shall be an NSO unless otherwise specified by the Committee
at the time of grant. The maximum number of Shares with respect to which
Options may be granted to any one Participant in any calendar year shall be
1,000,000, in the case of 1999, and in the case of any subsequent year, 110%
of the maximum permitted for the immediately preceding calendar year. Each
Option shall be evidenced by an Option agreement that shall specify (A) the
type of Option granted, (B) the number of Shares to which the Option pertains,
(C) the exercise price, (D) the period in which the Option may be exercised
and (E) such terms and conditions not inconsistent with the Plan as the
Committee shall determine.

          5.2 Exercise Price. Unless otherwise determined by the Committee,
Options granted pursuant to the Plan shall have an exercise price that is not
less than the Fair Market Value of a Share on the date the Option is granted.

          5.3 Exercisability. Unless otherwise determined by the Committee,
Options awarded under the Plan shall vest and become exercisable in three
equal annual installments commencing on the second anniversary of the date
such Options are granted, subject to the Participant's continuous employment
with the Company or a Subsidiary from the date of grant through the applicable
vesting date. No Option shall be exercisable for more than 10 years after the
date on which it is granted.

          5.4 Payment. The Committee shall establish procedures governing the
exercise of Options. Without limiting the generality of the foregoing, the
Committee may provide that payment of the exercise price may be made (A) in
cash or its equivalent, (B) by exchanging Shares owned by the optionee (which
are not the subject of any pledge or other security interest), (C) through an
arrangement with a broker approved by the Company whereby payment of the
exercise price is accomplished with the proceeds of the sale of Common Stock
or (D) by any combination of the foregoing; provided that the combined value
of all cash and cash equivalents paid and the Fair Market Value of any such
Common Stock so tendered to the Company, valued as of the date of such tender,
is at least equal to such exercise price. No Shares shall be delivered
pursuant to any exercise of an Option unless arrangements satisfactory to the
Committee have been made to assure full payment of the exercise price therefor
and any required withholding or other similar taxes or governmental charges.
Upon such terms and conditions as the Committee may establish from time to
time, a Participant may be permitted to defer the receipt of Shares otherwise
deliverable upon exercise of an Option.

          5.5 Reload Options. The Committee may provide that a Participant
(or,if applicable, his or her Permitted Transferee) who delivers Shares that
have been owned by such Participant (or Permitted Transferee) for any minimum
period of time specified by the Committee to exercise an Option (when the Fair
Market Value of Common Stock exceeds the exercise price of such Option) will
automatically be granted new Options ("Reload Options") for a number of Shares
equal to the number of Shares so delivered. Unless the Committee determines
otherwise, such Reload Options will be subject to the same terms and
conditions (including the same expiration date) as the related Option except
(A) that the exercise price shall initially be equal to the Fair Market Value
of a Share on the date such Reload Option is granted and (B) such Reload
Option shall not be exercisable prior to the six month anniversary of the date
of grant and, thereafter, shall be exercisable in full.

          5.6 Termination of Employment. Unless otherwise determined by the
Committee at or after the date of grant, in the event a Participant's
employment terminates by reason of a Qualifying Termination of Employment, the
Participant (or the Participant's beneficiary or legal representative) may
exercise any Options (regardless of whether then exercisable) until the
earlier of (A) the twelve-month anniversary of the date of such termination of
employment and (B) the date such Options would otherwise expire but for the
operation of this Section 5.6. Unless otherwise determined by the Committee at
or after the date of grant, in the event a Participant's employment terminates
for any reason other than a Qualifying Termination of Employment, any Option
granted to such
7

Participant, whether or not then exercisable, shall be forfeited and cancelled
as of the date of such termination of employment.

          5.7 Buyout. The Committee may at any time offer to buy out an Option
previously granted for a payment in cash, based on such terms and conditions
as the Committee shall establish and communicate to the optionee at the time
that such offer is made.

                                  ARTICLE VI
                     RESTRICTED STOCK AND RESTRICTED UNITS

          6.1 Grant of Restricted Stock and Restricted Units. The Committee
shall have the power to grant Restricted Stock or Restricted Units to any
Participant and to determine (A) the number of Shares of Restricted Stock and
the number of Restricted Units to be granted to each Participant, (B) the
Restriction Period(s) and (B) the other terms and conditions of such Awards.
The Committee shall require that the stock certificates evidencing any
Restricted Stock or Restricted Units be held in the custody of the Secretary
of the Company until the Period of Restriction lapses, and that, as a
condition of any Restricted Stock or Restricted Unit award, the Participant
shall have delivered a stock power, endorsed in blank, relating to the Share
covered by such award. Each grant of Restricted Stock or Restricted Units
shall be evidenced by a written agreement setting forth the terms of such
Award.

          6.2 Vesting of Restricted Stock and Restricted. Unless otherwise
determined by the Committee at or after the date of grant, Restricted Stock or
Restricted Units granted pursuant to Section 6.1 shall vest and become
nonforfeitable, and the Period of Restriction with respect to such Restricted
Stock or Restricted Units will lapse, in equal annual installments commencing
on the third anniversary of the date of grant.

          6.3 Dividend Equivalents. (a) Restricted Stock. Unless otherwise
determined by the Committee at the time of grant, Participants holding
outstanding Restricted Stock shall be entitled to receive currently all
Dividend Equivalents paid with respect to such Shares of Restricted Stock.

          (b) Restricted Units. The Committee will determine whether and to
what extent to credit to the account of, or to pay currently to, each
recipient of a Restricted Unit, any Dividend Equivalents. To the extent
provided by the Committee at or after the date of grant, any cash Dividend
Equivalents credited to a Participant's account shall be deemed to have been
invested in Shares on the record date established for the related dividend
and, accordingly, a number of Restricted Units shall be credited to such
Participant's account equal to the greatest whole number which may be obtained
by dividing (I) the value of such Dividend Equivalent on the record date by
(II) the Fair Market Value of a Share on such date. Any additional Restricted
Units credited in respect of Dividend Equivalents shall become vested and
nonforfeitable, if at all, on the same terms and conditions as are applicable
in respect of the Restricted Units with respect to which such Dividend
Equivalents were payable.

          6.4 Termination of Employment. Unless otherwise determined by the
Committee at or after the date of grant, in the event a Participant's
employment terminates by reason of a Qualifying Termination of Employment
during the Period of Restriction, a pro rata portion of any Shares related to
a Restricted Stock or Restricted Unit held by such Participant shall become
nonforfeitable, based upon the percentage of which the numerator is the
portion of the Period of Restriction that expired prior to the Participant's
termination and the denominator is the number of days in the Period of
Restriction. Unless otherwise determined by the Committee at or after the date
of grant, in the event a Participant's employment terminates for any reason
other than a Qualifying Termination of Employment during the Period of
Restriction, any Restricted Stock or Restricted Units held by such Participant
shall be forfeited and cancelled as of the date of such termination of
employment.

          6.5 Settlement of Restricted Units. Unless the Committee determines
otherwise at or after the date of grant, when a Restriction Period with
respect to an Award of Restricted Units lapses and the Restricted Units become
vested and nonforfeitable, the Participant shall receive (I) one Share for
each such Restricted Unit (including additional Restricted Units credited in
respect of Dividend Equivalents) or (II) if the Committee so determines, the
8

Committee may direct the Company to pay to the Participant the Fair Market
Value of such Shares as of such payment date.

                                  ARTICLE VII
                               INCENTIVE AWARDS

          7.1 Grant of Incentive Stock and Incentive Units. The Committee
shall have the authority to grant Incentive Stock or Incentive Units to any
Participant and to determine (A) the number of Incentive Stock and the number
of Incentive Units to be granted to each Participant, (B) the restrictions
pursuant to which such Award is subject to forfeiture by reason of the
Performance Restriction established by the Committee pursuant to Section 7.2
not being met in whole or in part and (C) the other terms and conditions of
such Awards. Each grant of Incentive Stock or Incentive Units shall be
evidenced by a written agreement setting forth the terms of such Award.

          7.2 Performance Restriction. (a) Within 90 days after each
Performance Period begins (or such other date as may be required or permitted
under Section 162(m), if applicable), the Committee shall establish the
performance objective or objectives for the applicable Performance Period that
must be satisfied in order for an Award to be vested and nonforfeitable (the
"Performance Restriction"). Any such Performance Restriction will be based
upon the relative or comparative achievement of one or more of the following
criteria, as determined by the Committee: (I) earnings per share on the
Company's Common Stock; (II) growth in the Company's revenue; (III) growth in
the Company's assets under management; (IV) increase in the Company's net
income; (V) return on shareholder's equity; (VI) controlling expenses; and
(VII) relative performance versus a peer group of companies.

          (b) The Performance Restriction related to Incentive Stock or
Incentive Units shall lapse upon the determination by the Committee that the
objective or objectives for the applicable Performance Period have been
attained, in whole or in part. The Committee may provide at the time of grant
that in the event the objective or objectives are attained in part, a
specified portion (which may be zero) of the Award will vest and become
nonforfeitable and the remaining portion shall be forfeited.

          7.3 Dividend Equivalents. (a) Incentive Stock. Unless otherwise
determined by the Committee at or after the date of grant, Participants
granted Incentive Stock shall be entitled to receive cash Dividend Equivalents
currently.

          (b) Incentive Units. The Committee will determine whether and to
what extent to credit to the account of, or to pay currently to, each
recipient of an Incentive Unit, any Dividend Equivalents. To the extent
provided by the Committee at or after the date of grant, any cash Dividend
Equivalents with respect to the Incentive Units credited to a Participant's
account shall be deemed to have been invested in Shares on the record date
established for the related dividend and, accordingly, a number of Incentive
Units, as the case may be, shall be credited to such Participant's account
equal to the greatest whole number which may be obtained by dividing (I) the
value of such Dividend Equivalent on the record date by (II) the Fair Market
Value of a Share on such date. Any additional Incentive Unit credited in
respect of Dividend Equivalents shall become vested and nonforfeitable, if at
all, on the same terms and conditions as are applicable in respect of the
Incentive Unit with respect to which such Dividend Equivalents were payable.

          7.4 Termination of Employment. Unless the Committee otherwise
determines at or after the date of grant, in the event that a Participant's
Employment terminates by reason of a Qualifying Termination of Employment
during the Performance Period, any award of Incentive Stock or Incentive Units
shall become vested and nonforfeitable at the end of the Performance Period as
to that number of such Incentive Stock or Incentive Units, as the case may be,
that is equal to that percentage, if any, of such Award that would have been
earned had the Participant's employment not so terminated prior to the
expiration of the Performance Period times a fraction, the numerator of which
is the number of days employed during the Performance Period and the
denominator of which is the total number of days during the Performance
Period. Unless otherwise determined by the Committee at or after the date of
grant, in the event a Participant's employment terminates for any reason other
than a Qualifying Termination of Employment during the Performance Period, any
Incentive Stock or Incentive Units held by such Participant shall be forfeited
and cancelled as of the date of such termination of employment.
9

          7.5 Settlement of Incentive Units. Unless the Committee determines
otherwise at or after the date of grant, when a Performance Restriction with
respect to an Award of Incentive Units lapses and the Incentive Units become
vested and nonforfeitable, the Participant shall receive (I) one Share for
each such Incentive Unit (including additional Incentive Units credited in
respect of Dividend Equivalents) or (II) if the Committee so determines, the
Committee may direct the Company to pay to the Participant the Fair Market
Value of such Shares as of such payment date.

                                 ARTICLE VIII
                                DEFERRED SHARES

          8.1 Deferred Share Awards. The Committee shall have the authority to
grant Deferred Shares to any Participant and to determine (I) the number of
Deferred Shares granted to each Participant, (II) the date such Deferred
Shares shall become vested and (III) the date such Deferred Shares will be
payable to the Participant. In addition, on such date or dates as shall be
established by the Committee and subject to such terms and conditions as the
Committee shall determine, a Participant may be permitted to elect to defer
receipt of all or a portion of his annual compensation and/or annual incentive
bonus ("Deferred Amount") payable by the Company or a Subsidiary and receive
in lieu thereof a number of Deferred Shares equal to the greatest whole number
which may be obtained by dividing (I) the Deferred Amount by (II) the Fair
Market Value of a Share on the date such compensation or bonus would otherwise
have been payable to the Participant. No Shares will be issued at the time an
award of Deferred Shares is made and the Company shall not be required to set
aside a fund for the payment of any such award. The Company will establish a
separate account for the Participant and will record in such account the
number of Deferred Shares awarded to the Participant. To the extent the
Committee so determines, a Participant who elects to defer receipt of his or
her compensation or bonus and receive Deferred Shares shall receive that
number of supplemental Deferred Shares ("Supplemental Units") equal to the
greatest whole number which may be obtained by dividing (I) such percentage of
the Deferred Amount as is determined by the Committee by (II) the Fair Market
Value of a Share on the date of grant. Each grant of Deferred Shares and
Supplemental Units shall be evidenced by a written agreement setting forth the
terms of such Award.

          8.2 Vesting of Deferred Shares and Supplemental Units. The portion
of each Deferred Shares, together with any Dividend Equivalents credited with
respect thereto, shall be fully vested at all times. Unless the Committee
provides otherwise at or after the date of grant, the Supplemental Units,
together with any Dividend Equivalents credited with respect thereto, will
become vested in full on the fifth anniversary of the date the corresponding
Deferred Amount would have been paid absent the Participant's election to
defer receipt thereof, subject to the Participant's continuous employment with
the Company or a Subsidiary through such vesting date.

          8.3 Dividend Equivalents. The Committee will determine whether and
to what extent Dividend Equivalents will be credited to the account of, or
paid currently to, a recipient of a Deferred Shares or Supplemental Units. To
the extent provided by the Committee at or after the date of grant, any cash
Dividend Equivalents with respect to the Deferred Shares and Supplemental
Units deemed credited to a Participant's account shall be deemed to have been
invested in Shares on the record date established for the related dividend
and, accordingly, a number of Deferred Shares or Supplemental Units, as the
case may be, shall be credited to such Participant's account equal to the
greatest whole number which may be obtained by dividing (I) the amount of such
Dividend Equivalent on the record date by (II) the Fair Market Value of a
Share on such date.

          8.4 Termination of Employment. Unless the Committee otherwise
determines at or after the date of grant, in the event that a Participant's
employment terminates by reason of a Qualifying Termination of Employment
during the Performance Period, any Supplemental Units (and related Dividend
Equivalents) granted to a Participant shall become vested and nonforfeitable.
Unless otherwise determined by the Committee at or after the date of grant, in
the event a Participant's employment terminates for any reason other than a
Qualifying Termination of Employment during the Performance Period, any
Supplemental Units (and related Dividend Equivalents) held by such Participant
shall be forfeited and cancelled as of the date of such termination of
employment. In the event that a Participant's employment is terminated for
Cause (or, following the date the Participant's employment terminates, the
Committee determines that circumstances exist such that the Participant's
employment could have been terminated for Cause),
10

any Supplemental Units (and related Dividend Equivalents) granted to such
Participant, whether or not then vested, shall be forfeited and cancelled as
of the date of such termination of employment.

          8.5 Settlement of Deferred Shares. Unless the Committee determines
otherwise at or after the date of grant, a Participant shall receive as of the
date of such Participant's termination of employment (or such other date as
may be elected by the Participant in accordance with the rules and procedures
of the Committee) (I) one Share for each Deferred Share credited to such
Participant's account and (II) subject to Section 8.4, one Share for each
Supplemental Unit that shall have become vested. The Committee may provide in
the Award agreement applicable to any Deferred Shares or Supplemental Units
that, in lieu of issuing Shares, the Committee may direct the Company to pay
to the Participant the Fair Market Value of such Shares as of such payment
date.

                                  ARTICLE IX
                               CHANGE IN CONTROL

          9.1 Accelerated Vesting and Payment. Subject to the provisions of
Sections 9.2 below, in the event of a Change in Control, each Option shall be,
at the discretion of the Committee, either canceled in exchange for a payment
in cash of an amount equal to the excess, if any, of the Change in Control
Price over the exercise price for such Option, or fully exercisable regardless
of the exercise schedule otherwise applicable to such Option and all other
Awards shall become nonforfeitable and be immediately transferable or payable,
as the case may be.

          9.2 Alternative Awards. Notwithstanding Section 9.1, no
cancellation, acceleration of exercisability, vesting, cash settlement or
other payment shall occur with respect to any Award or any class of Awards if
the Committee reasonably determines in good faith prior to the occurrence of a
Change in Control that such Award or Awards shall be honored or assumed, or
new rights substituted therefor (such honored, assumed or substituted award an
"Alternative Award"), by a Participant's employer (or the parent or a
Subsidiary of such employer) immediately following the Change in Control,
provided that any such Alternative Award must:

          (i) be based on stock which is traded on an established securities
market, or which will be so traded within 60 days of the Change in Control;

          (ii) provide such Participant (or each Participant in a class of
Participants) with rights and entitlements substantially equivalent to or
better than the rights, terms and conditions applicable under such Award,
including, but not limited to, an identical or better exercise or vesting
schedule and identical or better timing and methods of payment;

          (iii) have substantially equivalent economic value to such Award
(determined at the time of the Change in Control);

          (iv) have terms and conditions which provide that in the event that
the Participant's employment is involuntarily terminated or constructively
terminated, any conditions on a Participant's rights under, or any
restrictions on transfer or exercisability applicable to, each such
Alternative Award shall be waived or shall lapse, as the case may be.

For this purpose, a constructive termination shall mean a termination by a
Participant following a material reduction in the Participant's base salary or
a Participant's incentive compensation opportunity or a material reduction in
the Participant's responsibilities, in either case without the Participant's
written consent.

                                   ARTICLE X
                              STOCKHOLDER RIGHTS

          A Participant (or a Permitted Transferee) shall have no rights as a
stockholder with respect to any Shares covered by an Award until he or she
shall have become the holder of record of such Share(s), and no adjustments
11

shall be made for dividends in cash or other property or distribution or other
rights in respect to any such Shares, except as otherwise specifically
provided for in this Plan.

                                  ARTICLE XI
               AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN

          The Board at any time may terminate or suspend the Plan, and from
time to time may amend or modify the Plan, provided that no amendment,
modification, or termination of the Plan shall in any manner adversely affect
any Award theretofore granted under the Plan, without the consent of the
Participant. Unless earlier terminated, the Plan shall terminate on December
31 of the tenth year following the year in which the Initial Public Offering
occurs.

                                  ARTICLE XII
                           MISCELLANEOUS PROVISIONS

          12.1 Nontransferability of Awards. No Award shall be assignable or
transferable except by will or the laws of descent and distribution; provided
that the Committee may permit (on such terms and conditions as it shall
establish) a Participant to transfer an Award for no consideration to the
Participant's child, stepchild, grandchild, parent, stepparent, grandparent,
spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including
adoptive relationships, any person sharing the Participant's household (other
than a tenant or employee), a trust in which these persons have more than
fifty percent of the beneficial interest, a foundation in which these persons
(or the Participant) control the management of assets, and any other entity in
which these persons (or the Participant) own more than fifty percent of the
voting interests ("Permitted Transferees"). Except to the extent required by
law, no right or interest of any Participant shall be subject to any lien,
obligation or liability of the Participant. All rights with respect to Awards
granted to a Participant under the Plan shall be exercisable during the
Participant's lifetime only by such Participant or, if applicable, his or her
Permitted Transferee(s). The rights of a Permitted Transferee shall be limited
to the rights conveyed to such Permitted Transferee, who shall be subject to
and bound by the terms of the agreement or agreements between the Participant
and the Company.

          12.2 Beneficiary Designation. Each Participant under the Plan may
from time to time name any beneficiary or beneficiaries (who may be named
contingently or successively) to whom any benefit under the Plan is to be paid
or by whom any right under the Plan is to be exercised in case of his death.
Each designation will revoke all prior designations by the same Participant,
shall be in a form prescribed by the Committee, and will be effective only
when filed by the Participant in writing with the Committee during his
lifetime. In the absence of any such designation, benefits remaining unpaid at
the Participant's death shall be paid to or exercised by the Participant's
surviving spouse, if any, or otherwise to or by his or her estate.

          12.3 No Guarantee of Employment or Participation. Nothing in the
Plan shall interfere with or limit in any way the right of the Company or any
Subsidiary to terminate any Participant's employment at any time, nor to
confer upon any Participant any right to continue in the employ of the Company
or any Subsidiary. No Employee shall have a right to be selected as a
Participant, or, having been so selected, to receive any future Awards.

          12.4 Tax Withholding. The Company shall have the right to deduct
from all amounts paid to a Participant in cash (whether under this Plan or
otherwise) any taxes required by law to be withheld in respect of Awards under
this Plan. In the case of any Award satisfied in the form of Shares, no shares
shall be issued unless and until arrangements satisfactory to the Committee
shall have been made to satisfy any withholding tax obligations applicable
with respect to such Award. Without limiting the generality of the foregoing,
the Company shall have the right to retain, or the Committee may, subject to
such terms and conditions as it may establish from time to time, permit
Participants to elect to tender, Shares (including Shares issuable in respect
of an Award) to satisfy, in whole or in part, the amount required to be
withheld (but no greater amount).

          12.5 Compliance with Legal and Exchange Requirements. The Plan, the
granting and exercising of Awards thereunder, and the other obligations of the
Company under the Plan, shall be subject to all applicable Federal and
12

State laws, rules, and regulations, and to such approvals by any regulatory or
governmental agency as may be required, and to any rules or regulations of any
exchange on which the Shares are listed. The Company, in its discretion, may
postpone the granting and exercising of Awards, the issuance or delivery of
Shares under any Award or any other action permitted under the Plan to permit
the Company, with reasonable diligence, to complete such stock exchange
listing or registration or qualification of such Shares or other required
action under any Federal or State law, rule, or regulation and may require any
Participant to make such representations and furnish such information as it
may consider appropriate in connection with the issuance or delivery of Shares
in compliance with applicable laws, rules, and regulations. The Company shall
not be obligated by virtue of any provision of the Plan to recognize the
exercise of any Award or to otherwise sell or issue Shares in violation of any
such laws, rules, or regulations; and any postponement of the exercise or
settlement of any Award under this provision shall not extend the term of such
Awards, and neither the Company nor its directors or officers shall have any
obligation or liability to the Participant with respect to any Award (or
Shares issuable thereunder) that shall lapse because of such postponement.

          12.6 Indemnification. Each person who is or shall have been a member
of the Committee or of the Board shall be indemnified and held harmless by the
Company against and from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by him in connection with or resulting
from any claim, action, suit, or proceeding to which he may be made a party or
in which he may be involved by reason of any action taken or failure to act
under the Plan and against and from any and all amounts paid by him in
settlement thereof, with the Company's approval, or paid by him in
satisfaction of any judgment in any such action, suit, or proceeding against
him, provided he shall give the Company an opportunity, at its own expense, to
handle and defend the same before he undertakes to handle and defend it on his
own behalf. The foregoing right of indemnification shall not be exclusive and
shall be independent of any other rights of indemnification to which such
persons may be entitled under the Company's Articles of Incorporation or
By-laws, by contract, as a matter of law, or otherwise.

          12.7 Legend. To the extent any stock certificate is issued to a
Participant in respect of shares of Restricted Stock prior to the expiration
of the Period of Restriction, such certificate shall be registered in the name
of the Participant and shall bear the following (or similar) legend:

          "The shares of stock represented by this certificate are subject to
the terms and conditions contained in the 1999 Neuberger Berman Inc. Long-Term
Incentive Plan and the Award Agreement, dated as of _____________, between the
Company and the Participant, and may not be sold, pledged, transferred,
assigned, hypothecated or otherwise encumbered in any manner (except as
provided in Section 12.1 of the Plan or in such Award Agreement) until
_______________."

Upon the lapse of the Period of Restriction with respect to such Restricted
Stock, the Company shall issue or have issued in exchange for those
certificates previously issued new share certificates without the legend
described herein in respect of any shares that have become vested.

          12.8 Effective Date. The Plan shall be effective as of the date of
the Initial Public Offering.

          12.9 No Limitation on Compensation. Nothing in the Plan shall be
construed to limit the right of the Company to establish other plans or to pay
compensation to its employees, in cash or property, in a manner which is not
expressly authorized under the Plan.

          12.10 Deferrals. The Committee may postpone the exercising of
Awards, the issuance or delivery of Stock under any Award or any action
permitted under the Plan to prevent the Company or any Subsidiary from being
denied a Federal income tax deduction with respect to any Award other than an
ISO.

          12.11 Governing Law. The Plan shall be construed in accordance with
and governed by the laws of the State of New York, without reference to
principles of conflict of laws which would require application of the law of
another jurisdiction, except to the extent that the corporate law of the State
of Delaware specifically and mandatorily applies.
13

          12.12 No Impact on Benefits. Except as may otherwise be specifically
stated under any employee benefit plan, policy or program, no amount payable
in respect of any Award shall be treated as compensation for purposes of
calculating an Employee's right under any such plan, policy or program.

          12.13 No Constraint on Corporate Action. Nothing in this Plan shall
be construed (A) to limit, impair or otherwise affect the Company's right or
power to make adjustments, reclassifications, reorganizations or changes of
its capital or business structure, or to merge or consolidate, or dissolve,
liquidate, sell, or transfer all or any part of its business or assets or (B)
to limit the right or power of the Company, or any Subsidiary to take any
action which such entity deems to be necessary or appropriate.

          12.14 Headings and Captions. The headings and captions herein are
provided for reference and convenience only, shall not be considered part of
this Plan, and shall not be employed in the construction of this Plan.
EXHIBIT 5.1

                         LEHMAN BROTHERS HOLDINGS INC.
                                399 Park Avenue
                           New York, New York 10022

                               October 31, 2003

Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549

Ladies and Gentlemen:

         I am a Vice President and Associate General Counsel of Lehman
Brothers Holdings Inc., a Delaware corporation (the "Company"). A Registration
Statement on Form S-8 (the "Registration Statement"), under the Securities Act
of 1933, as amended (the "Securities Act"), is being filed concurrently
herewith by the Company with the Securities and Exchange Commission (the
"SEC"). The Registration Statement relates to the registration of 5,944,642
shares of authorized and unissued or issued Common Stock (the "Shares") to be
distributed from time to time to certain employees of the Company under the
1999 Neuberger Berman Inc. Long-Term Incentive Plan, as amended (the "Plan").

         In that connection, I or members of my staff have examined or relied
upon originals or copies, certified or otherwise identified to our
satisfaction, of such documents, corporate records, certificates and
instruments relating to the Company as I have deemed relevant and necessary to
the formation of the opinion hereinafter set forth. In such examination, I
have assumed the genuineness and authenticity of all documents examined by me
or members of my staff and all signatures thereon, the legal capacity of all
persons executing such documents, the conformity to originals of all copies of
documents submitted to us and the truth and correctness of any representations
and warranties contained therein.

         Based upon the foregoing, I am of the opinion that the issuance by
the Company of the Shares has been duly authorized, and when the Shares are
duly issued in accordance with the terms of the Plan, such Shares will be
validly issued, fully paid and nonassessable.

         In rendering this opinion, I express no opinion as to the laws of any
jurisdiction other than the State of New York, the General Corporation Law of
the State of Delaware and the United States of America.

         I hereby consent to the filing of this opinion (and this consent) as
an exhibit to the Registration Statement, without admitting that I am an
"expert" under the Securities Act, or the rules and regulations of the SEC
issued thereunder, with respect to any part of the Registration Statement,
including this exhibit.

                                  Very truly yours,

                                  /s/ OLIVER BUDDE
                                  --------------------
                                  Oliver Budde
                                  Vice President and Associate General Counsel
EXHIBIT 23.2

                        CONSENT OF INDEPENDENT AUDITORS

         We consent to the incorporation by reference in this Registration
Statement (Form S-8) of Lehman Brothers Holdings Inc. (the "Company") for the
registration of shares of the Company's Common Stock, par value $0.10 per
share, pertaining to the 1999 Neuberger Berman Inc. Long-Term Incentive Plan,
as amended, of our report dated January 10, 2003, with respect to the
consolidated financial statements and schedule of the Company incorporated by
reference in its Annual Report (Form 10-K) for the year ended November 30, 2002
and the related financial statement schedule included therein, filed with the
Securities and Exchange Commission.

                                              /S/ ERNST & YOUNG LLP
                                             ---------------------------
                                             Ernst & Young LLP

New York, New York
October 31, 2003