PRICING SUPPLEMENT NO. 87 Rule 424(b)(3)
DATED: May 7, 1998 File No. 333-43565
(To Prospectus dated January 21, 1998
and Prospectus Supplement dated January 21, 1998)
$7,096,595,162
THE BEAR STEARNS COMPANIES INC.
MEDIUM-TERM NOTES, SERIES B
WITH MINIMUM MATURITY OF NINE MONTHS FROM DATE OF ISSUE
Principal Amount: $5,000,000* Floating Rate Notes [_] Book Entry Notes [x]
Original Issue Date: 5/27/98 Fixed Rate Notes [x] Certificated Notes [_]
Maturity Date: 5/27/2005 CUSIP #: 073928 BX 0
Option to Extend Maturity: No [x]
Yes [_] Final Maturity Date:
Optional Optional
Redemption Repayment Repayment
Redeemable On Price(s) Date(s) Price(s)
- ------------- ----------- ---------- ----------
***** N/A N/A N/A
Applicable Only to Fixed Rate Notes:
- -----------------------------------
Interest Rate: 6.440% Payment Amount: **
Payment Dates: *** Amortization of Principal: ****
Applicable Only to Floating Rate Notes:
- --------------------------------------
Interest Rate Basis: Maximum Interest Rate:
[_] Commercial Paper Rate Minimum Interest Rate:
[_] Federal Funds Rate Interest Reset Date(s):
[_] Treasury Rate Interest Reset Period:
[_] LIBOR Reuters Interest Payment Date(s):
[_] LIBOR Telerate
[_] Prime Rate
[_] CMT Rate
Initial Interest Rate: Interest Payment Period:
Index Maturity:
Spread (plus or minus):
- --------------------------------
* Subject to monthly amortization after November 27, 1999.
** The product of (a) 0.0644, (b) 1/12, and (c) the Principal Amount at the
start of the applicable period.
*** Monthly on the 27th of each month commencing on June 27, 1998.
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**** Amortization of Principal:
Reference Pool: FHLMC A020, 30-Year FHLMC 6.50% Production
issued in calendar months January 1997
through December 1997.
Amortization Dates: Commencing November 27, 1999 and on
each Interest Payment Date thereafter (each
an "Amortization Date"), the then outstanding
Principal Amount of the Note will be subject
to amortization.
Amortization Amounts: On each Amortization Determination Date (as
defined below) the Calculation Agent will
determine the one-month PSA Rate for the
current month (as defined below) and the
corresponding Amortization Reference Rate
based on the Amortization Table on the
corresponding Amortization Date. The then
outstanding Principal Amount of the Note
shall be amortized by an amount such that the
remaining Principal Amount of the Note
outstanding shall be the difference of (a)
the Principal Amount of the Note outstanding
immediately prior to such redemption, less
(b) the product of (i) the "Amortization
Reference Rate" calculated from the
Amortization Table and (ii) the Principal
Amount of the Note immediately prior to such
redemption.
Amortization
Determination Date: The determination date for the Amortization
Amounts will be 10 Business Days prior to
each Payment Date.
PSA Rate: The PSA Rate will be determined by
[Bear Stearns & Co. Inc.], as calculation
agent (the "Calculation Agent"), for each
Amortization Determination Date, in
accordance with the following provisions:
(i) for each Amortization Determination Date,
the PSA Rate will be the one month PSA
prepayment speed calculated based on the
methodology specified as the PSA Standard
Prepayment Model in the Uniform Practices for
the Clearance and Settlement of Mortgage
Backed Securities and other related
securities (as in effect on May 7, 1998) of
the Public Securities Association for
determining the principal amount of a pool of
outstanding 30-year Freddie Mac Gold 6.50%
production issued in calendar months January
1997 through December 1997 (FMAC A020). The
PSA Rate applicable to a particular
Amortization Determination Date will appear
on Bloomberg page FMAC A020 [GO] titled
"Reference Collateral 30Yr Gold 6.5 Issued in
1997" under column "1 MO" opposite the row
"PSA" for the month in which such
Amortization Determination Date falls, or
such other page as may replace that page, for
the purpose of displaying rates or prices
that are comparable, as determined by the
Calculation Agent (after consultation with
the Company) to the one-month PSA prepayment
speed formerly displayed on that page; or
(ii) if the information specified in
subparagraph (i) above is not available on
any Amortization Determination Date, or the
applicable month's rate is not available on
such page on a particular Amortization
Determination Date, then the PSA Rate in
respect of a Amortization Determination Date
will be obtained from FHLMC Investor Inquiry
Department; or
(iii) if the information specified in
subparagraph (i) and (ii) is not available at
any Amortization Determination Date, then the
PSA Rate in respect of an Amortization
Determination Date will be determined by the
Calculation Agent requesting five major
security dealers to provide a quotation of
the PSA Rate for the Reference Pool. If at
least two quotations are provided as
requested, the rate for the Reference Pool in
respect to an Amortization
<PAGE>
Determination Date will be the arithmetic
mean of the quotations;
(iv) if the information specified in
subparagraphs (i) and (ii) above is not
available at any Determination Date and the
Calculation Agent is unable to obtain the
requisite quotations specified in either
subparagraph (iii) above, then the PSA Rate
on the Notes for the applicable period shall
be the same as the PSA Rate on the Notes in
effect at that Amortization Determination
Date.
The calculation of the PSA Rate shall be
rounded to the nearest whole integer.
Amortization Table: Amortization Reference Rate for reference
pool PSA not listed below will be found by
linear interpolation.
Reference Amortization
Collateral Reference
PSA Rate (%)
less than or =125 0.0000
140 0.2886
150 1.6079
160 3.6039
250 3.6039
275 9.0723
greater than or=375 100.0000
***** If as a result of any amortization calculation, the outstanding
Principal Amount outstanding would be less than or equal to 10% of the
original Principal Amount, the Amortization Amount for the
corresponding Amortization Date will be the entire remaining Principal
Amount and the entire remaining Principal Amount will be redeemed on
such Amortization Date at 100% of the outstanding Principal Amount.
The distribution of Notes will conform to the requirements set forth in Rule
2720 of the NASD Conduct Rules.
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