By Jennifer Chiou
New York, Oct. 12 - The Bear Stearns Cos. Inc. priced a $38.5 million issue of notes due Oct. 14, 2011 linked to the performance of the U.S. Adagio Strategy index, according to a 424B5 filing with the Securities and Exchange Commission.
The U.S. Adagio Strategy index is based on three U.S. asset classes - equities, real estate and investment-grade debt securities - represented by the S&P 500 index, the iShares Dow Jones U.S. Real Estate Index Fund and the iShares Lehman Aggregate Bond Fund. The relative weightings will be rebalanced monthly.
The percentage weightings of the real estate component and the equity component in a given month are determined by a formula that uses the monthly returns of the real estate component and the equity component for each of the trailing 12 months, subject to a minimum weighting of 0% and a maximum weighting of 50% each. The weighting of the bond component, if any, is the percentage required to make the sum of all the components equal to 100%.
In addition, the overall index will be reduced by 22.5 basis points a month.
Investors will receive a coupon in October of 2007, 2008, 2009, 2010 and 2011 equal to any positive gain on the index minus the sum of the previously paid coupons.
Payout at maturity will be par.
Bear, Stearns & Co. Inc. is the underwriter.
| Issuer: | The Bear Stearns Cos. Inc.
|
| Issue: | Medium-term notes
|
| Underlying index: | U.S. Adagio Strategy index
|
| Amount: | $38.5 million
|
| Greenshoe: | $5.775 million
|
| Maturity: | Oct. 14, 2011
|
| Coupon: | Equal to any positive gain on the index minus the sum of the previously paid coupons
|
| Payment at maturity: | Par
|
| Pricing date: | Oct. 10
|
| Settlement date: | Oct. 13
|
| Agent: | Bear, Stearns & Co. Inc.
|
| Agent fees: | 3.1455%
|
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