SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
THE BEAR STEARNS COMPANIES INC.
(Exact name of registrant as specified in its charter)
DELAWARE 13-3286161
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
245 PARK AVENUE
NEW YORK, NEW YORK 10167
(212) 272-4394
(Address and telephone number of principal executive offices) (zip code)
THE BEAR STEARNS COMPANIES INC.
AE INVESTMENT AND DEFERRED COMPENSATION PLAN
(Full title of the plan)
WILLIAM J. MONTGORIS
CHIEF OPERATING OFFICER
THE BEAR STEARNS COMPANIES INC.
245 PARK AVENUE
NEW YORK, NEW YORK 10167
(Name and address of agent for service)
-------------------
(212) 272-2000
(Telephone number, including area code, of agent for service)
-------------------
COPY TO:
Mitchell S. Fishman, Esq.
Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, New York 10019-6064
(212) 373-3000
-------------------
(cover continued on next page)
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===============================================================================================================================
TITLE OF EACH CLASS OF AMOUNT TO BE Proposed Maximum Proposed Maximum Amount of
SECURITIES TO BE REGISTERED REGISTERED(1) Offering Price Aggregate Offering Registration Fee(1)
Per Share(2) Price (2)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $1.00 par value 500,000 $ 24.44 $12,220,000 $3,703.03
===============================================================================================================================
</TABLE>
(1) 858,191 shares of the Common Stock of The Bear Stearns Companies Inc. (the
"Company") were previously registered pursuant to the Company's registration
statement on Form S-8, Registration No. 33-26181 (the "Original Registration
Statement") with respect to The Bear Stearns Companies Inc. RR Investment
and Deferred Compensation Plan, now known as The Bear Stearns Companies Inc.
AE Investment and Deferred Compensation Plan (the "Plan"). The Company paid
a filing fee of $1200 in connection with the registration of 466,019 shares
of its Common Stock pursuant to the Original Registration Statement; the
distribution of such shares has not been completed. The Company has
effected various stock dividends since the filing of the Original
Registration Statement, and, as a result thereof, an additional 392,172
shares of the Company's Common Stock are covered by the Original
Registration Statement. This registration statement on Form S-8 is being
filed to register an additional 500,000 shares of Common Stock with respect
to the Plan. This registration statement also relates to such indeterminate
number of additional shares of Common Stock of the Company as may be issued
as a result of stock splits, stock dividends and similar transactions.
(2) An estimate has been made as of November 7, 1996 solely for the purpose of
calculating the registration fee upon the basis of fluctuating market prices
pursuant to Rule 457(c) and (h) under the Securities Act of 1933.
In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement also covers an indeterminate amount of interests to
be offered or sold pursuant to the employee benefit plan described herein.
================================================================================
<PAGE>
EXPLANATORY NOTE
The documents containing the information specified in Part I of Form S-8
have not been filed as part of this registration statement pursuant to
the Note to Part I of Form S-8, nor are such documents filed with the
Securities and Exchange Commission either as a prospectus or prospectus
supplement pursuant to Rule 424.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Securities and
Exchange Commission (the "Commission") are incorporated herein by
reference:
1. The Company's Annual Report on Form 10-K for the fiscal year
ended June 30, 1996;
2. The Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended September 27, 1996;
3. The Company's Current Reports on Form 8-K dated October 16,
1996, October 29, 1996 and November 12, 1996;
4. The description of the Common Stock contained in the Company's
Registration Statement on Form 10, dated September 19, 1985.
All documents filed by the Company or the Plan pursuant to
Sections 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 registered hereby
have been sold or which deregisters all securities then remaining unsold,
shall be deemed to be incorporated by reference in this registration
statement and to be part hereof from the date of filing of such
documents.
Item 4. DESCRIPTION OF SECURITIES
Not Applicable.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
II-1
<PAGE>
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Reference is made to Section 145 of the Delaware General Corporation
Law which provides for indemnification of directors and officers in
certain circumstances.
Article VIII of the Company's Restated Certificate of Incorporation
provides for indemnification of directors and officers of the Company
against certain liabilities incurred as a result of their duties as such
and also provides for the elimination of the monetary liability of
directors for certain actions as such. The Company's Restated
Certificate of Incorporation, as amended, is filed as Exhibit 4(a) to the
Registration Statement on Form S-8 (No. 33-49979) filed August 13, 1993,
and is incorporated by reference herein.
The Company has in effect reimbursement insurance for directors' and
officers' liability claims and directors' and officers' liability
insurance indemnifying, respectively, the Company and its directors and
officers within specific limits for certain liabilities incurred by them,
subject to the conditions and exclusions and deductible provisions of the
policies.
For the undertaking with respect to indemnification, see Item 9
herein.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
II-2
<PAGE>
Item 8. EXHIBITS
(3)(a)(1) Restated Certificate of Incorporation of the Company, filed
September 11, 1985 (incorporated by reference to Exhibit No.
(4)(a)(1) to the Company's registration statement on Form S-8 (File
No. 33-49979)).
(3)(a)(2) Certificate of Amendment to the Restated Certificate of
Incorporation of the Company, filed October 29, 1985 (incorporated
by reference to Exhibit No. (4)(a)(2) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(3) Certificate of Stock Designation to the Restated Certificate of
Incorporation of the Company, filed October 29, 1985 (incorporated
by reference to Exhibit No. (4)(a)(3) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(4) Certificate of Change of Address of Registered Agent to the
Restated Certificate of Incorporation of the Company, filed February
14, 1986 (incorporated by reference to Exhibit No. (4)(a)(4) to the
Company's registration statement on Form S-8 (File No. 33-49979)).
(3)(a)(5) Certificate of Amendment to the Restated Certificate of
Incorporation of the Company filed September 18, 1986 (incorporated
by reference to Exhibit No. (4)(a)(5) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(6) Certificate of Stock Designation to the Restated Certificate of
Incorporation of the Company, filed February 19, 1987 (incorporated
by reference to Exhibit No. (4)(a)(6) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(7) Certificate of Correction to the Restated Certificate of
Incorporation of the Company, filed February 25, 1987 (incorporated
by reference to Exhibit No. (4)(a)(7) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(8) Certificate of Change of Address of Registered Agent to the
Restated Certificate of Incorporation of the Company, filed October
27, 1988 (incorporated by reference to Exhibit No. (4)(a)(8) to the
Company's registration statement on Form S-8 (File No. 33-49979)).
(3)(a)(9) Certificate of Amendment to the Restated Certificate of
Incorporation of the Company, filed November 6, 1989 (incorporated
by reference to Exhibit No. (4)(a)(9) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(10) Certificate of Amendment to the Restated Certificate ofIncorporation
of the Company, filed November 7, 1990 (incorporated by reference to
II-3
<PAGE>
Exhibit No. (4)(a)(10) to the Company's registration statement on
Form S-8 (File No. 33-49979)).
(3)(a)(11) Certificate of Amendment to the Restated Certificate of
Incorporation of the Company, filed November 10, 1992
(incorporated by reference to Exhibit No. (4)(a)(11) to the
Company's registration statement on Form S-8 (File No. 33-
49979)).
(3)(a)(12) Certificate of Stock Designation to the Restated Certificate of
Incorporation of the Company, filed March 23, 1993
(incorporated by reference to Exhibit No. (4)(a)(12) to the
Company's registration statement on Form S-8 (File No. 33-
49979)).
(3)(a)(13) Certificate of Stock Designation to the Restated Certificate of
Incorporation of the Company, filed July 22, 1993 (incorporated
by reference to Exhibit No. (4)(a)(13) to the Company's
registration statement on Form S-8 (File No. 33-49979)).
(3)(a)(14) Form of Certificate of Stock Designations to the Restated
Certificate of Incorporation of the Company, (incorporated by
reference to Exhibit No. 4.4 to the Company' registration
statement on Form 8-A filed on February 23, 1994).
(3)(b) Amended and Restated By-laws of the Company (incorporated by
reference to Exhibit No. (3)(b) to Company's Annual Report on
Form 10-K for its fiscal year ended June 30, 1991 and Exhibit
No. (3)(b) to the Company's Quarterly Report on Form 10-Q for
the quarterly period ended December 31, 1992).
4(a)* The Bear Stearns Companies Inc. AE Investment and Deferred
Compensation Plan, as amended.
5(a)* Opinion of Paul, Weiss, Rifkind, Wharton & Garrison as to the
legality of the securities being registered.
23(a)* Consent of Deloitte & Touche LLP.
23(b)* Consent of Paul, Weiss, Rifkind, Wharton & Garrison (included in
their opinion filed as Exhibit 5(a)).
24(a)* Power of Attorney (included in the signature pages to this
registration statement).
__________________
* Filed herewith.
II-4
<PAGE>
Item 9. UNDERTAKINGS
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 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; (2) that, for the purpose of
determining any liability under the Securities Act of 1933, 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; and (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.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 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.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the registrant's
Certificate of Incorporation or by-laws, by contract, or otherwise, the
registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the 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 Act and will be governed by the final
adjudication of such issue.
II-5
<PAGE>
SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the Securities Act
of 1933, as amended, 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 November 8, 1996.
THE BEAR STEARNS COMPANIES INC.
By:/S/ WILLIAM J. MONTGORIS
------------------------------------
Name:William J. Montgoris
Title:Chief Operating Officer
We, the undersigned officers and directors of The Bear Stearns
Companies Inc., hereby severally constitute Alan C. Greenberg, James E.
Cayne and William J. Montgoris and any of them singly, our true and
lawful attorneys with full power to sign for us and in our names in the
capacities indicated below, any and all amendments, including post-
effective amendments, to this registration statement, and generally do
all such things in our name and behalf in such capacities to enable The
Bear Stearns Companies Inc. to comply with the applicable provisions of
the Securities Act of 1933, as amended, and all requirements of the
Securities and Exchange Commission, and we hereby ratify and confirm our
signatures as they may be signed by our said attorneys, or any of them,
to any and all such amendments.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on November 8, 1996.
SIGNATURE TITLE
/S/ ALAN C. GREENBERG
- -----------------------------
Alan C. Greenberg Chairman of the Board;
Director
/S/ JAMES E. CAYNE
- -----------------------------
James E. Cayne
President and Chief Executive Officer
(Principal Executive Officer); Director
II-6
<PAGE>
SIGNATURE TITLE
/S/ WILLIAM J. MONTGORIS Chief Operating Officer; Director
- -----------------------------
William J. Montgoris
/S/ MARK E. LEHMAN
- -----------------------------
Executive Vice President; Director
Mark E. Lehman
/S/ ALAN D. SCHWARTZ
- -----------------------------
Alan D. Schwartz Executive Vice President; Director
/S/ WARREN J. SPECTOR
- -----------------------------
Warren J. Spector Executive Vice President; Director
/S/ MICHAEL L. TARNOPOL
- -----------------------------
Michael L. Tarnopol Executive Vice President; Director
/S/ MICHAEL MINIKES
- -----------------------------
Michael Minikes Treasurer; Director
- -----------------------------
E. Garrett Bewkes, III Director
II-7
<PAGE>
SIGNATURE TITLE
/S/ DENIS A. BOVIN
- -----------------------------
Denis A. Bovin Director
- -----------------------------
Ralph R. Cioffi Director
/S/ BARRY J. COHEN
- -----------------------------
Barry J. Cohen Director
/S/ PETER D. CHERASIA
- -----------------------------
Peter D. Cherasia Director
/S/ WENDY L. DE MONCHAUX
- -----------------------------
Wendy L. de Monchaux Director
/S/ GRACE J. FIPPINGER Director
- -----------------------------
Grace J. Fippinger
II-8
<PAGE>
SIGNATURE TITLE
/S/ BRUCE E. GEISMAR
- -----------------------------
Bruce E. Geismar Director
/S/ CARL D. GLICKMAN
- -----------------------------
Carl D. Glickman Director
/S/ THOMAS R. GREEN
- -----------------------------
Thomas R. Green Director
/S/ DONALD J. HARRINGTON
- -----------------------------
Donald J. Harrington Director
- -----------------------------
Richard Harriton Director
/S/ DANIEL L. KEATING
- -----------------------------
Daniel L. Keating Director
/S/ JOHN W. KLUGE
- -----------------------------
John W. Kluge Director
/S/ DAVID A. LIEBOWITZ
- -----------------------------
David A. Liebowitz Director
II-9
<PAGE>
SIGNATURE TITLE
/S/ BRUCE M. LISMAN Director
- -----------------------------
Bruce M. Lisman
/S/ ROLAND N. LIVNEY
- -----------------------------
Roland N. Livney Director
/S/ DONALD R. MULLEN, JR.
- -----------------------------
Donald R. Mullen, Jr. Director
/S/ FRANK T. NICKELL
- -----------------------------
Frank T. Nickell Director
/S/ CRAIG M. OVERLANDER
- -----------------------------
Craig M. Overlander Director
/S/ STEPHEN E. RAPHAEL
- -----------------------------
Stephen E. Raphael Director
/S/ E. JOHN ROSENWALD, JR.
- -----------------------------
E. John Rosenwald, Jr. Director
II-10
<PAGE>
SIGNATURE TITLE
- -----------------------------
Lewis A. Sachs Director
- -----------------------------
Richard Sachs Director
/S/ FREDERIC V. SALERNO
- -----------------------------
Frederic V. Salerno Director
/S/ DAVID M. SOLOMON
- -----------------------------
David M. Solomon Director
/S/ ROBERT M. STEINBERG
- -----------------------------
Robert M. Steinberg Director
/S/ VINCENT TESE
- -----------------------------
Vincent Tese Director
- -----------------------------
Michael J. Urfirer Director
- -----------------------------
Fred Wilpon Director
/S/ UZI ZUCKER
- -----------------------------
Uzi Zucker Director
II-11
<PAGE>
SIGNATURE TITLE
/S/ MICHAEL J. ABATEMARCO
- -----------------------------
Michael J. Abatemarco Controller
/S/ SAMUEL L. MOLINARO, JR.
- -----------------------------
Samuel L. Molinaro, Jr. Chief Financial Officer (Principal
Financial and Accounting Officer)
II-12
<PAGE>
SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities Act of 1933,
the Plan 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 November 8, 1996.
THE BEAR STEARNS COMPANIES INC.
AE INVESTMENT AND DEFERRED
COMPENSATION PLAN
By: /S/ GEORGE SARNER
---------------------------------
Name: George Sarner
Title: Member of the AE
Deferred Compensation
and Investment Committee
By: /S/ STEVEN M. DANTUS
---------------------------------
Name:Steven M. Dantus
Title:Member of the AE
Deferred Compensation
and Investment Committee
By: /S/ STEPHEN A. LACOFF
---------------------------------
Name:Stephen A. Lacoff
Title:Member of the AE
Deferred Compensation
and Investment Committee
II-13
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
(3)(a)(1) Restated Certificate of Incorporation of the Company, filed
September 11, 1985 (incorporated by reference to Exhibit No.(4)(a)(1)
to the Company's registration statement on Form S-8 (File No. 33-
49979)).
(3)(a)(2) Certificate of Amendment to the Restated Certificate of
Incorporation of the Company, filed October 29, 1985 (incorporated by
reference to Exhibit No. (4)(a)(2) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(3) Certificate of Stock Designation to the Restated Certificate of
Incorporation of the Company, filed October 29, 1985 (incorporated by
reference to Exhibit No. (4)(a)(3) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(4) Certificate of Change of Address of Registered Agent to the Restated
Certificate of Incorporation of the Company, filed February 14, 1986
(incorporated by reference to Exhibit No. (4)(a)(4) to the Company's
registration statement on Form S-8 (File No. 33-49979)).
(3)(a)(5) Certificate of Amendment to the Restated Certificate of
Incorporation of the Company filed September 18, 1986 (incorporated
by reference to Exhibit No. (4)(a)(5) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(6) Certificate of Stock Designation to the Restated Certificate of
Incorporation of the Company, filed February 19, 1987 (incorporated
by reference to Exhibit No. (4)(a)(6) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(7) Certificate of Correction to the Restated Certificate of
Incorporation of the Company, filed February 25, 1987 (incorporated
by reference to Exhibit No. (4)(a)(7) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(8) Certificate of Change of Address of Registered Agent to the Restated
Certificate of Incorporation of the Company, filed October 27, 1988
(incorporated by reference to Exhibit No. (4)(a)(8) to the Company's
registration statement on Form S-8 (File No. 33-49979)).
(3)(a)(9) Certificate of Amendment to the Restated Certificate of
Incorporation of the Company, filed November 6, 1989 (incorporated by
reference to Exhibit No. (4)(a)(9) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
<PAGE>
(3)(a)(10) Certificate of Amendment to the Restated Certificate of
Incorporation of the Company, filed November 7, 1990 (incorporated
by reference to Exhibit No. (4)(a)(10) to the Company's
registration statement on Form S-8 (File No. 33-49979)).
(3)(a)(11) Certificate of Amendment to the Restated Certificate of
Incorporation of the Company, filed November 10, 1992 (incorporated
by reference to Exhibit No. (4)(a)(11) to the Company's
registration statement on Form S-8 (File No. 33-49979)).
(3)(a)(12) Certificate of Stock Designation to the Restated Certificate of
Incorporation of the Company, filed March 23, 1993 (incorporated by
reference to Exhibit No. (4)(a)(12) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(13) Certificate of Stock Designation to the Restated Certificate of
Incorporation of the Company, filed July 22, 1993 (incorporated by
reference to Exhibit No. (4)(a)(13) to the Company's registration
statement on Form S-8 (File No. 33-49979)).
(3)(a)(14) Form of Certificate of Stock Designations to the Restated
Certificate of Incorporation of the Company, (incorporated by
reference to Exhibit No. 4.4 to the Company' registration statement
on Form 8-A filed on February 23, 1994).
(3)(b) Amended and Restated By-laws of the Company (incorporated by
reference to Exhibit No. (3)(b) to Company's Annual Report on Form
10-K for its fiscal year ended June 30, 1991 and Exhibit No. (3)(b)
to the Company's Quarterly Report on Form 10-Q for the quarterly
period ended December 31, 1992).
4(a)* The Bear Stearns Companies Inc. AE Investment and Deferred
Compensation Plan, as amended.
5(a)* Opinion of Paul, Weiss, Rifkind, Wharton & Garrison as to the
legality of the securities being registered.
23(a)* Consent of Deloitte & Touche LLP.
23(b)* Consent of Paul, Weiss, Rifkind, Wharton & Garrison (included in
their opinion filed as Exhibit 5(a)).
24(a)* Power of Attorney (included in the signature pages to this
registration statement).
__________________
* Filed herewith.
THE BEAR STEARNS COMPANIES INC.
AE INVESTMENT AND DEFERRED COMPENSATION PLAN
<PAGE>
THE BEAR STEARNS COMPANIES INC.
AE INVESTMENT AND DEFERRED COMPENSATION PLAN
SECTION 1
PURPOSE AND EFFECTIVE DATE
1.1 The purpose of The Bear Stearns Companies Inc. AE Investment
and Deferred Compensation Plan is to assist The Bear Stearns Companies
Inc. in attracting and retaining account executives who will make a
significant contribution to the success of the business of The Bear
Stearns Companies Inc. and its subsidiary,
Bear, Stearns & Co. Inc.
1.2 The effective date of this Plan is January 1, 1989.
SECTION 2
DEFINITIONS
When used herein, the following terms shall have the following
meanings:
2.1 "Account" means a Company Contribution Account or a Deferred
Compensation Account under this Plan.
2.2 "Affiliate" means any corporation or other entity which is
controlled, directly or indirectly, by the Company and which the
Committee designates as an "affiliate" for purposes of the Plan from time
to time.
2.3 "Associate" means (1) any corporation or organization of which
such Person is an officer or partner or is, directly or indirectly, the
Beneficial Owner of 10% or more of any class of equity securities, (2)
any trust or other estate in which such Person has a substantial
beneficial interest or as to which such Person serves as trustee or in a
similar fiduciary capacity, and (3) any relative or spouse of such
Person, or any relative of such spouse, who has the same home as such
Person or who is a director or officer of such Person or any of its
parents or subsidiaries.
2.4 "Bear Stearns" means Bear, Stearns & Co. Inc., a Delaware
corporation, and its successors and assigns.
2.5 "Beneficial Owner," "Beneficial Ownership" and similar terms
shall have the meaning specified in Rule 13d-3 under the Securities
Exchange Act of 1934, except that in any case a Person shall be deemed
the Beneficial Owner of any securities owned directly or indirectly by
the Affiliates and Associates of such Person.
2.6 "Beneficiary" means the beneficiary or beneficiaries designated
in accordance with Section 11 to receive the amount, if any, payable
hereunder upon the death of a Participant.
1
<PAGE>
2.7 "Board of Directors" means the Board of Directors of the
Company.
2.8 "Change in Control" means (i) a majority of the Board of
Directors ceases to consist of Continuing Directors; (ii) any Person
becomes the Beneficial Owner of 50% or more of the outstanding voting
power of the Company unless such acquisition is approved by a majority of
the Continuing Directors; (iii) the stockholders of the Company approve
an agreement to merge or consolidate into any other entity, unless such
merger or consolidation is approved by a majority of the Continuing
Directors; or (iv) the stockholders of the Company approve an agreement
to dispose of all or substantially all of the assets of the Company,
unless such disposition is approved by a majority of the Continuing
Directors.
2.9 "Committee" means the AE Deferred Compensation and Investment
Committee designated by the Board of Directors or any duly authorized
committee thereof to administer this Plan.
2.10 "Company" means The Bear Stearns Companies Inc., a Delaware
corporation and its successors and assigns.
2.11 "Company Common Stock" means common stock, par value $1.00 per
share, of the Company.
2.12 "Company Contribution Account" means the bookkeeping entry
established and maintained in respect of a Participant pursuant to
Section 4.1.
2.13 "Compensation" means all amounts paid to an Employee by the
Company or Bear Stearns during a calendar year, including any elective
deferrals under this Plan, The Bear Stearns Companies Inc. Cash or
Deferred Compensation Plan or any other tax-qualified or nonqualified
deferred compensation plan or program, but excluding any payments of
amounts under such plans, payments made under the Company's or Bear
Stearns' short-term sick pay plan, and any other form of non-cash
compensation; PROVIDED, HOWEVER, that with respect to each Employee who
is designated by an Employer as a Senior Managing Director, Compensation
means only commissions and fees (excluding base salary and bonus).
2.14 "Continuing Director" means any member of the Board of
Directors who was such a member on January l, 1989 or who is elected to
the Board of Directors after January l, 1989 upon the recommendation or
with the approval of a majority of the Continuing Directors at the time
of such recommendation or approval.
2.15 "Deferred Compensation Account" means the bookkeeping entry
established and maintained in respect of a Participant pursuant to
Section 5.3.
2.16 "Disability" means the complete and permanent inability of an
individual to perform his duties due to his physical or mental
incapacity, all as determined by the
2
<PAGE>
Committee upon the basis of such evidence, including independent
medical reports and data, as the Committee deems appropriate or
necessary. Notwithstanding the above, an individual automatically shall
be deemed to have suffered a Disability if such individual is eligible
for disability benefits under any employer sponsored long term
disability program or under the U.S. Social Security system.
2.17 "Employee" means any person (other than any executive officer
or director of the Company unless such person is an account executive who
becomes a director) employed by Bear Stearns or, if so determined by the
Committee, by any Affiliate, as an account executive, provided that such
individual's Compensation in the applicable calendar year is at least
$100,000 or such other amount as determined by the Committee.
2.18 "Fund" means any one or more of the investment vehicles
selected by the Committee in order to determine the amounts to be
credited or debited on the unpaid amount in each Company Contribution
Account and Deferred Compensation Account pursuant to Section 6. The
Committee shall determine the investment performance of any Fund or
Funds.
2.19 "Hardship" shall mean an unforeseen emergency to the
Participating Director resulting from a sudden and unexpected illness or
accident of the Participating Director or the Participating Director's
dependent (as defined in section 152(a) of the Internal Revenue Code of
1986, as amended), loss of the Participating Director's property due to
casualty or other similar extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of the Participating
Director.
2.20 "Participant" means any Employee, former Employee,
Participating Director or former Participating Director who is eligible
to participate in the Plan or for whom a Company Contribution Account or
Deferred Compensation Account is maintained.
2.21 "Participating Director" shall mean an Employee who is a Senior
Managing Director, Managing Director or Associate Director of the
Company.
2.22 "Person" shall mean an individual, a corporation, a
partnership, an association, a joint stock company, a trust, any
unincorporated organization or a government or a political subdivision
thereof.
2.23 "Plan" means The Bear Stearns Companies Inc. AE Investment and
Deferred Compensation Plan as set forth herein and as amended and
restated from time to time.
2.24 "Retirement" means the termination of an individual's
employment with the Company on or after attaining the age 65 or at such
other date as the Committee determines.
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2.25 "Valuation Date" means, for each Fund, the applicable date as
designated by the Committee, on which the value of a Fund or of a
Participant's Account with respect to a Fund is to be determined,
including any other date as the Committee, in its sole discretion, may
designate from time to time.
SECTION 3
ELIGIBILITY
3.1 Each Employee shall participate in the Plan in accordance with
the terms of the Plan; provided, however, that only Participating
Directors who have filed a valid Compensation Reduction Agreement (as
defined in Section 5.1) with the Committee shall be eligible to defer
Compensation pursuant to Section 5.
SECTION 4
COMPANY BENEFIT
4.1 During the first quarter of each calendar year beginning with
the year 1990, the Company shall credit, for bookkeeping purposes only,
to each Employee's Company Contribution Account, the percentage of such
Employee's Compensation for the immediately preceding calendar year
determined pursuant to the following table:
INCREMENTAL
INCREMENTAL COMPENSATION
COMPANY CONTRIBUTION
$100,000 or less ............................... 0%
between $100,001($300,000 ...................... 3.25%
between $300,001($500,000 ...................... 4.25%
between $500,001($700,000 ...................... 4.50%
$700,001 and over............................... 4.75%
An Employee shall not be eligible to receive a Company Contribution
under this Section 4 in any calendar year in which his Compensation is
less than or equal to $100,000 or such other amount as determined by the
Committee.
Notwithstanding anything else herein to the contrary, the amount
credited to an Employee's Company Contribution Account for any calendar
year shall not exceed $44,300 (regardless of the amount of the Employee's
Compensation for such year) unless prior to the start of such year the
Committee determines to apply a different limit.
4.2 The amount credited to an Employee's Company Contribution
Account under Section 4.1 for any year, as adjusted pursuant to Section
6.1, shall become fully
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vested on the fifth anniversary of the December 31 of the calendar year
to which such credit relates, provided that the Employee has five
consecutive years of service with Bear Stearns or any Affiliate during
such period, or such shorter period as determined by the Committee. In
addition, the entire amount credited to an Employee's Company
Contribution Account shall become fully vested upon his
termination of employment with Bear Stearns without being employed
substantially contemporaneously therewith by an Affiliate due to his
death, Disability or Retirement or upon the occurrence of a Change in
Control. Upon termination of an Employee's employment for any reason
other than death, Disability or Retirement, the unvested amount allocated
to such Employee's Company Contribution Account shall be forfeited except
such unvested amount that the Committee, in its sole discretion,
determines to vest in the Employee. If the Company terminates the Plan
pursuant to Section 10, the Committee shall, in its sole discretion,
determine whether the Participant shall continue to vest in unvested
amounts credited to the Participant's Company Contribution Account,
whether such amounts shall become immediately vested, or any combination
of the foregoing. The Company shall have no obligation to pay any
Participant or Beneficiary any amounts forfeited under this Section 4.2.
4.3 The establishment and maintenance of, or credits to, a Company
Contribution Account shall not vest in any Participant or his Beneficiary
any right, title or interest in or to any specific assets of the Company,
or in or to any specific assets of any Fund.
SECTION 5
ELECTIVE DEFERRALS
5.1 Each Participating Director may execute and file with the
Committee a "Compensation Reduction Agreement," in the form approved by
the Committee, electing that a portion of his Compensation for a calendar
year, equal to one percent and not more than twenty percent (or ten
percent in the case of a Participating Director who is an Associate
Director), in multiples of one percent, of his compensation during a
calendar year shall be payable only as deferred Compensation under the
Plan; provided, however, that a Participating Director shall not be
permitted to defer more than $100,000 of Compensation in any calendar
year or such other dollar limit as may, from time to time, be determined
by the Committee.
5.2(a)Each election to defer Compensation shall be made prior to the
end of the calendar year preceding the calendar year for which such
deferral is to take effect. In addition, any Participating Director may
make such an election (i) within 30 days after the effective date of the
Plan, with respect to his Compensation for services performed during the
calendar year in which the effective date occurs but after the effective
date of the election, and (ii) within 30 days after becoming a
Participating Director, to defer compensation for services performed
during his first calendar year or portion thereof as a Director after the
effective date of the election. In addition, a Participating Director
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<PAGE>
who changes status from Associate Director to Managing Director may
elect, within 30 days after such change in status, to increase his
deferral election to up to twenty percent, in multiples of one percent,
of his Compensation after the effective date of the election. A
Participating Director who changes status from Managing Director to
Associate Director shall not be allowed to defer more than ten percent of
his Compensation in the year following such change in status.
(b) The election to defer Compensation pursuant to a Compensation
Reduction Agreement shall be irrevocable for a full calendar year or for
such portion thereof remaining after the effective date of the election
and shall continue in effect for each subsequent year until the
Participating Director ceases to be a Participating Director or until the
Participating Director terminates or modifies the election; provided,
however, that in the event of a Hardship, the Committee, in its sole
discretion, may terminate any Compensation Reduction Agreement with
respect to a Participating Director for the remainder of the applicable
calendar year. Any such termination or modification shall be made in
writing and filed with the Committee, within the time prescribed by the
Committee and prior to the end of the calendar year preceding the
calendar year for which it is effective.
(c) A Participating Director who has filed a termination of
election pursuant to Section 5.2(b) may thereafter file another election
described in Section 5.2(a) for any calendar year commencing subsequent
to the filing of such election.
(d) If a Participating Director's status changes so that he is no
longer a Participating Director but is still an Employee, no further
amounts shall be credited to such individual's Deferred Compensation
Account pursuant to Section 5 with respect to such individual's
Compensation and such individual's Compensation Reduction Agreement shall
be void, all as of the date of such change in status, but such individual
shall continue to be eligible for credits to his Company Contribution
Account pursuant to Section_4 based on his Compensation as an Employee
for the entire calendar year.
5.3 All Compensation deferred under this Section 5 shall be
credited to the Deferred Compensation Account established for the
Participating Director by the end of the month in which it otherwise
would have been paid. A Participating Director shall always be fully
vested in the amount credited to his Deferred Compensation Account as
adjusted from time to time pursuant to Section 6.1.
5.4 The establishment and maintenance of, or credits to, such
Deferred Compensation Account shall not vest in any Participating
Director or his Beneficiary any right, title or interest in or to any
specific assets of the Company, or in or to any specific assets of any
Fund.
SECTION 6
ADDITIONAL ALLOCATION
6
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6.1 Subject to Section 6.7, each Employee and Participating
Director shall select a Fund or Funds for purposes of allocation under
the Plan in multiples of ten percent for each of his Company Compensation
Account and his Deferred Compensation Account. Such selection shall be
made prior to the later of (i) the date the Employee or Participating
Director becomes eligible to participate in the Plan or (ii) 30 days
after the effective date of the Plan. A Participant may elect to change
his selection of a Fund or Funds for purposes of allocation under the
Plan for a current calendar year twice in each calendar year. Such an
election shall be made on the form and within the time prescribed by the
Committee and no election shall be honored if received by the Committee
earlier or later than such times. No such change in selection shall be
effective prior to 90 days after the effective date of any prior
selection for the current calendar year. A change in selection shall be
effective as of a Valuation Date no later than 30 days after it is timely
filed with the Committee.
6.2 Each Company Contribution Account and each Deferred
Compensation Account shall be credited (or debited) with additional
amounts equal to the investment performance (including interest and
dividends paid) of each of the Fund or Funds selected by the Participant
pursuant to Section 6.1 or 6.3 with respect to the relevant period, which
credit (or debit) shall be made as soon as practicable after the
Valuation Date for each of the Fund or Funds. All such amounts credited
(or debited) pursuant to the preceding sentence shall be deemed to be
reinvested in (or deducted from) the Fund to which the amounts relate and
such reinvestment (or deduction) shall be deemed to occur as of the
applicable Valuation Date for such Fund.
6.3 A Participant may select different Funds for purposes of
allocation under the Plan, in multiples of ten percent, with respect to
each calendar year for which amounts are credited to his Company
Contribution Account or Deferred Compensation Account, and, if such
different selections are made, each such Account shall be treated as a
separate Account for purposes of allocation and recordkeeping under the
Plan. The selection of Funds for any calendar year may be changed during
such calendar year pursuant to Section 6.1. If a Participant changes his
selection of Funds for amounts credited to any Account in respect of any
prior calendar year after the end of such year, he shall be deemed to
have changed his selection of Funds for all amounts credited to any
Account in respect of all prior calendar years. Such a change may be
made twice in each calendar year. Such an election shall be made on the
form and within the time prescribed by the Committee and no election
shall be honored if received by the Committee earlier or later than such
time. No such change in selection shall be effective prior to 90 days
after the effective date of any prior election for a prior calendar year.
A change in selection shall be effective as of a Valuation Date no later
than 30 days after it is timely filed with the Committee.
6.4 If the effective date of a change in selection made under
Section 6.1 or 6.3 is not a Valuation Date for both the Fund which had
previously been selected and the newly selected Fund, the amounts
affected by such change shall be credited (or debited)
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with additional amounts equal to the investment performance of the Fund
which is a money market fund from the Valuation Date of the Fund which
had been previously selected until the immediately following
Valuation Date of the newly selected Fund.
6.5 A Participant who ceases to be an employee of Bear Stearns
without becoming employed substantially contemporaneously therewith by an
Affiliate shall have no right to select any Fund or Funds thereafter and
his Account shall be credited (or debited) with investment performance
thereafter in accordance with Section 6.6. No selection of any Fund or
Funds shall be effective if a Participant terminates employment with Bear
Stearns without becoming employed substantially contemporaneously
therewith by an Affiliate before the applicable Valuation Date on which
such selection would otherwise be effective.
6.6 Each Company Contribution Account and Deferred Compensation
Account shall continue to be credited (or debited) under each of the Fund
or Funds selected by the Participant under this Section 6 until (i) in
the case of a Participant who is expected to receive a distribution on
account of a Distribution Election which did not specify distribution
upon his termination of employment, the Valuation Date for each of the
Fund or Funds immediately preceding the date such distribution is
expected to be payable, or (ii) in the case of a Participant who
terminates employment, the Valuation Date for each of the Fund or Funds
immediately following his termination of employment; and, in either case,
such Company Contribution Account or Deferred Compensation Account shall
be credited (or debited) thereafter with additional amounts equal to the
investment performance of the Fund which is a money market fund until
actually distributed to the Participant. Any amount payable to a
Participant on account of termination of employment may be made, as
determined by the Committee, within 60 days after either the immediately
following applicable Valuation Date for each such Fund or Funds to be
valued, or the latest such Valuation Date.
6.7 The Committee may impose any limitations on any Fund or Funds,
including limitations on the minimum and maximum amounts which may be
elected by any or all Participants with respect to any Fund or Funds, and
the minimum and maximum number of Funds which may be selected by a
Participant. If a Participant selects a Fund which is the Company Common
Stock fund, he cannot change this selection at any time. If a
Participant fails to make a selection of Fund or Funds for purposes of
allocation of his Company Contribution Account or Deferred Compensation
Account, such Accounts shall be credited (or debited) with additional
amounts equal to the investment performance of the Fund which is a money
market fund pending such selection.
6.8 The Committee may, but need not, make the same Funds available
to all Participants. The Committee may, in its sole discretion, change
the Funds available under the Plan at any time, including to add any Fund
or Funds which are not managed by Bear Stearns.
8
<PAGE>
6.9 The Company and Bear Stearns shall have no obligation to invest
a Participant's Company Contribution Account or Deferred Compensation
Account in any Fund or Funds selected by the Participant.
SECTION 7
PAYMENT OF BENEFITS
7.1 Prior to becoming eligible to participate in the Plan, each
Employee or Participating Director may execute and file with the
Committee a "Distribution Agreement," in the form approved by the
Committee, electing that the vested amount credited to his Company
Contribution Account and the amount credited to his Deferred Compensation
Account shall be payable to the Employee in the form and at the time or
times specified in such Distribution Agreement. If the Employee or
Participating Director does not file a Distribution Agreement, his vested
Company Contribution Account and his Deferred Compensation Account shall
be paid in a lump sum within 60 days after the Valuation Date immediately
following the later of the date the Employee terminates his employment
with Bear Stearns without becoming employed substantially
contemporaneously therewith by an Affiliate or attains age 65. A
Participant may file a new Distribution Agreement with the Committee
prior to the end of the calendar year preceding the calendar year for
which it is to become effective; provided, however, that no such new
Distribution Agreement shall apply to amounts credited to his Company
Contribution Account or his Deferred Compensation Account prior to the
effective date of such new Distribution Agreement.
7.2 Notwithstanding any election to the contrary, the vested amount
allocated to each Participant's Company Contribution Account and Deferred
Compensation Account shall be paid in a lump sum on the earliest of the
following dates: (i) within 60 days after the Valuation Date next
following a Change in Control, (ii) within 60 days after the Valuation
Date next following the date the Committee receives written notification
of the Participant's death, (iii) within 60 days after the Valuation Date
next following the termination of the Plan, (iv) at the discretion of the
Committee, within 60 days after the December 31 next following the date
the Participant suffers a Disability and (v) at the discretion of the
Committee, as soon as administratively feasible after the date a
Participant requests a distribution as a result of a Hardship. The
Committee may also make payment of amounts due with respect to any
Participant at any time, whether or not he has terminated employment with
the Company or Bear Stearns, regardless of the Participant's Distribution
Agreement.
7.3 Notwithstanding any provision herein to the contrary, upon an
occurrence of a Change in Control, amounts shall not be vested or
immediately distributable under the Plan if and to the extent that the
Committee determines that such vesting or acceleration (taken together
with any other payments received or to be received by the Participant
from the Company, Bear Stearns or an Affiliate in connection with a
Change in Control) would constitute or result in an "excess parachute
payment" under Section
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280G of the Internal Revenue Code of 1986, as amended (the
"Code"), or any similar provision of the Code or of any successor
federal income tax law, which would cause such amounts to be subject
to an excise tax to the Participant or nondeductible to the Company
or, Bear Stearns, as the case may be.
7.4 All amounts payable under this Plan shall be paid in cash,
provided that any amounts which are calculated by reference to Company
Common Stock under Section 6 may, in the discretion of the Committee, be
paid in the form of whole shares of Company Common Stock with a cash
payment in lieu of any fractional shares.
SECTION 8
SOURCE OF PAYMENT
8.1 All payments provided for under the Plan shall be paid in cash
from the general funds of the Company; provided, however, that amounts to
be paid in Company Common Stock shall be paid in treasury shares or
shares of authorized but unissued common stock, and provided further,
that such distributions shall be reduced by the amount of any payments
made to the Participant or his Beneficiary from any trust or special or
separate fund established by the Company to assure such payments. The
Company shall not be required to establish a special or separate fund or
otherwise segregate any assets to assure such payments and, if the
Company shall make any investments to aid it in meeting its obligations
hereunder, the Participant and his Beneficiary shall have no right, title
or interest whatever in or to any such investments except such interest,
if any, as may otherwise be expressly provided in a separate written
instrument relating to such investments. Nothing contained in this Plan,
and no action taken pursuant to its provisions, shall create or be
construed to create a trust of any kind between the Company and any
Participant or Beneficiary. To the extent that any Participant or
Beneficiary acquires a right to receive payments from the Company
hereunder, such right shall be no greater than the right of a general
unsecured creditor of the Company.
SECTION 9
ADMINISTRATION OF THE PLAN
9.1 The Plan shall be administered by the Committee, which shall
have full power and authority to interpret, construe and administer the
Plan and to review claims for benefits under the Plan. The Committee's
interpretations and constructions of the Plan and actions thereunder
shall be binding and conclusive on all persons and for all purposes. The
Committee's determination of the amounts in any Fund or Funds or in any
Company Contribution Account or Deferred Compensation Account shall be
final and binding on all persons, including the Company, the Participant
and his Beneficiaries.
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9.2 The Committee shall establish and maintain records of the Plan
and of each account established for any Participant hereunder. The
Committee shall engage such certified public accountants, who may be
accountants for the Company, as it shall require or may deem advisable
for purposes of the Plan, may arrange for the engagement of such legal
counsel, who may be counsel for the Company, and may make use of such
agents and clerical or other personnel as it shall require or may deem
advisable for purposes of the Plan. The Committee may rely upon the
written opinion of the accountants engaged by the Committee and such
counsel and may delegate to any agent or to any subcommittee or member of
the Committee its authority to perform any act hereunder, including
without limitation those matters involving the exercise of discretion,
provided that such delegation of authority shall be subject to revocation
at any time at the discretion of the Committee. The Company shall pay
the fees and expenses of such accountants, counsel, agents and other
personnel and all other costs of administration of the Plan.
9.3 To the maximum extent permitted by applicable law, no member of
the Committee shall be personally liable by reason of any contract or
other instrument executed by him or on his behalf in his capacity as a
member of the Committee or for any mistake of judgment made in good
faith, and the Company shall indemnify and hold harmless, directly from
its own assets (including the proceeds of any insurance policy the
premiums of which are paid from the Company's own assets), each member of
the Committee and each other officer, employee or director of the Company
to whom any duty or power relating to the administration or
interpretation of the Plan or to the management or control of the assets
of the Plan may be delegated or allocated, against any cost or expense
(including fees, disbursements and other charges of legal counsel) or
liability (including any sum paid in settlement of a claim with the
approval of the Company) arising out of any act or omission to act in
connection with the Plan unless arising out of such person's own fraud,
willful misconduct or bad faith.
SECTION 10
AMENDMENT AND TERMINATION
10.1 The Plan may be amended, suspended or terminated, in whole or
in part, by the Board of Directors, but no such action shall
retroactively impair or otherwise adversely affect the rights of any
person to benefits under the Plan which have accrued prior to the date of
such action, as determined by the Committee.
SECTION 11
DESIGNATION OF BENEFICIARIES
11.1 Each Participant who participates in the Plan shall file with
the Committee a written designation of one or more persons as the
Beneficiary who shall be entitled to receive the amount, if any, payable
under the Plan upon his death. A Participant, from
11
<PAGE>
time to time, may revoke or change his Beneficiary designation without
the consent of any prior Beneficiary by filing a new such designation
with the Committee. The most recent such designation received by
the Committee shall be controlling; provided, however, that no
designation, or change of revocation thereof, shall be effective
unless received by the Committee prior to the Participant's death, and
in no event shall it be effective as of the date prior to such receipt.
11.2 If no such Beneficiary designation is in effect at the time of
a Participant's death, or if no designated Beneficiary survives the
Participant, or if such designation conflicts with law, the Participant's
estate shall be deemed to have been designated his Beneficiary and shall
receive the payment of the amount, if any, payable under the Plan upon
his death. If the Committee is in doubt as to the right of any person to
receive such amount, the Committee may retain such amount, without
liability for any interest thereon, until the rights thereto are
determined, or the Committee may pay such amount into any court of
appropriate jurisdiction and such payment shall be a complete discharge
of the liability of the Plan and the Company therefor.
SECTION 12
GENERAL PROVISIONS
12.1 The Plan shall be binding upon and inure to the benefit of the
Company and its successors and assigns and the Participant, his
Beneficiaries and his estate.
12.2 Neither the Plan nor any action taken hereunder shall be
construed as giving to a Participant the right to be retained in the
employ of the Company or any subsidiary or affiliate thereof or as
affecting the right of the Company or any subsidiary or affiliate thereof
to dismiss any Participant.
12.3 The Company may withhold from any amounts payable under this
Plan all federal, state, city or other taxes as may be required pursuant
to any law or governmental regulation or ruling.
12.4 No right to any amount payable at any time under the Plan may
be assigned, transferred, pledged or encumbered, either voluntarily or by
operation of law, except as provided expressly herein (including in
Section 12.6) as to payments to a Participant or Beneficiary or as may
otherwise be required by law. If, by reason of any attempted assignment,
transfer, pledge or encumbrance, or any bankruptcy or other event
happening at any time, any amount payable under the Plan would be made
subject to the debts or liabilities of the Participant or his Beneficiary
or Beneficiaries or would otherwise not be enjoyed by him, then the
Committee, if it so elects, may terminate such person's interest in any
such payment and direct that the same be held and applied to or for the
benefit of the Participant, his Beneficiary or Beneficiaries, or any
other person deemed to be the natural objects of his bounty, taking into
account the expressed wishes of the Participant (or, in the event of his
death, his Beneficiary or Beneficiaries).
12
<PAGE>
12.5 If the Committee shall find that any person to whom any amount
is or was payable hereunder is unable to care for his affairs because of
illness or accident, or has died, then the Committe, if it so elects, may
direct that any payment due him or his estate (unless a prior claim
therefore has been made by a duly appointed legal representative) or any
part thereof be paid or applied for the benefit of such person or to or
for the benefit of his spouse, children or other dependents, an
institution maintaining or having custody of such person, any guardian or
any other person deemed by the Committee to be a proper recipient on
behalf of such person otherwise entitled to payment, or any of them, in
such manner and proportion as the Committee may deem proper. Any such
payment shall be in complete discharge of the liability therefor of the
Company, the Plan or the Committee or any member, officer or employee
thereof.
12.6 The Company, Bear Stearns, and any Affiliate shall have the
absolute right to withhold any amounts payable to any Participant or
Beneficiary under the terms of the Plan, to the extent of any amount owed
for any reason by such Participant in the case of a payment to such
Participant, or to the extent of any amount owed for any reason by the
Participant or such Beneficiary in the case of payment to a Beneficiary,
to the Company, Bear Stearns or any Affiliate, and to set off and apply
the amounts so withheld to payment of any such amount owed to the
Company, Bear Stearns or any Affiliate, whether or not such amounts shall
then be immediately due and payable and in such order or priority as
among such amounts owed as the Committee in its sole discretion shall
determine.
12.7 All elections, designations, requests, notices, instructions
and other communications from a Participant, Beneficiary or other person
to the Committee required or permitted under the Plan shall be in such
form as is prescribed from time to time by the Committee, shall be mailed
by first-class mail or delivered to such location as shall be specified
by the Committee, and shall be deemed to have been given and delivered
only upon actual receipt thereof at such location.
12.8 The benefits payable under this Plan shall be in addition to
any other benefits provided for Participants.
12.9 The captions preceding the sections and articles hereof have
been inserted solely as a matter of convenience and in no way define or
limit the scope or intent of any provisions of the Plan.
12.10 References to Sections herein are to the specified Sections of
this Plan unless another reference is specifically stated.
12.11 This Plan shall be governed by the laws of the State of New
York as from time to time in effect.
12.12 The masculine pronoun wherever used herein shall include the
feminine pronoun.
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12.13 Whenever it is stated herein that the Committee may take any
action or make any determination, it may do so at any time and from time
to time as in its sole discretion it determines, unless specifically
stated to the contrary herein.
14
[LETTERHEAD OF PAUL, WEISS, RIFKIND, WHARTON & GARRISON]
November 13, 1996
The Bear Stearns Companies Inc.
245 Park Avenue
New York, New York 10167
Registration Statement on Form S-8
----------------------------------
Ladies and Gentlemen:
In connection with the registration statement on Form S-8 (the
"Registration Statement") relating to The Bear Stearns Companies Inc. AE
Investment and Deferred Compensation Plan, as amended (the "Plan"), being
filed today by The Bear Stearns Companies Inc. (the "Company") with the
Securities and Exchange Commission (the "Commission") pursuant to the
Securities Act of 1933, as amended (the "Act"), and the rules and
regulations thereunder (the "Rules"), you have requested that we furnish
you our opinion as to the legality of the interests in the Plan and the
shares of the
<PAGE>
The Bear Stearns Companies Inc. 2
Company's common stock, par value $1.00 per share (the "Common Stock"), to
be offered pursuant to the Plan.
In this connection, we have reviewed copies of (i) the
Registration Statement, including the exhibits thereto, (ii) the Restated
Certificate of Incorporation and By-laws of the Company, each as amended,
and (iii) certain records of the Company's corporate proceedings as
reflected in its minute books. In addition, we have made such other
examinations of law and fact as we considered necessary in order to form
a basis for the opinion hereinafter expressed.
In rendering the opinions expressed below, we have assumed (i)
the genuineness of all signatures, (ii) the authenticity of all documents
and instruments submitted to us as originals and that all documents and
instruments submitted to us as copies conform to the originals thereof
and (iii) the legal capacity of natural persons executing any of the
documents, none of which facts we have independently verified.
Based upon and subject to the foregoing, it is our opinion that
the interests in the Plan have been validly authorized by and constitute
legal and binding obligations of the Company and that the shares of
Common Stock which may be issued by the Company in accordance with the
terms of the Plan, when so issued, will be duly authorized, validly
issued, fully paid and nonassessable.
The opinions set forth above are subject to the qualification
that the enforceability of the interests in the Plan may be subject to
(i) bankruptcy, insolvency,
<PAGE>
The Bear Stearns Companies Inc. 3
fraudulent conveyance or transfer, reorganization, moratorium or other
similar laws now or hereafter in effect, relating to or affecting
creditors' rights or remedies generally and (ii) general equitable
principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law).
Our opinions expressed above are limited to the federal laws of
the United States, the laws of the State of New York and the Delaware
General Corporation Law. Our opinions are also rendered only with
respect to the laws, and the rules, regulations and orders thereunder,
which are currently in effect. Please be advised that no member of this
firm is admitted to practice in the State of Delaware.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement. In giving this consent, we do not hereby
agree that we come within the category of persons whose consent is
required by the Act or the Rules.
Very truly yours,
/s/ Paul, Weiss, Rifkind, Wharton & Garrison
PAUL, WEISS, RIFKIND, WHARTON & GARRISON
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of The Bear Stearns Companies Inc. on Form S-8 of our reports
dated August 26, 1996, appearing in and incorporated by reference in the
Annual Report on Form 10-K of The Bear Stearns Companies Inc. for the
year ended June 30, 1996, and to the reference to us under the heading
"Experts" in the Prospectus, which is part of such Registration
Statement.
/s/ DELOITTE & TOUCHE LLP
November 5, 1996
New York, New York