[CADWALADER, WICKERSHAM & TAFT LETTERHEAD]
January 11, 2001
The Bear Stearns Companies Inc.
245 Park Avenue
New York, New York 10167
Ladies and Gentlemen:
We have acted as special counsel to The Bear Stearns Companies Inc., a Delaware
corporation (the "Company"), in connection with the preparation and filing by
the Company of the Prospectus Supplement, dated January 11, 2001 (the
"Prospectus Supplement"), to the Prospectus, dated January 11, 2001 (the
"Prospectus"), pursuant to which the Company may from time to time issue its
Medium Term Notes, Series B (the "Notes") in an aggregate principal amount at
any one time outstanding of up to U.S. $9,015,893,162 (or an equivalent amount
in other currencies). The Prospectus and Prospectus Supplement are included in
the Registration Statement on Form S-3 (Registration No. 333-52902) (the
"Registration Statement") filed with the Securities and Exchange Commission (the
"Commission") pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), to which this opinion letter is an exhibit.
In rendering the opinion set forth below, we have examined and relied upon,
among other things, (a) the Registration Statement, including the Prospectus and
Prospectus Supplement constituting a part thereof, (b) the Indenture, dated as
of May 31, 1991, as supplemented by the First Supplemental Indenture, dated as
of January 29, 1998 (as supplemented, the "Indenture"), between the Company and
The Chase Manhattan Bank (formerly known as Chemical Bank and successor by
merger to Manufacturers Hanover Trust Company), as Trustee, filed as an exhibit
to the Registration Statement, and (c) originals, copies or specimens, certified
or otherwise identified to our satisfaction, of such certificates, corporate and
public records, agreements and instruments and other documents as we have deemed
appropriate as a basis for the opinion expressed below. In such examination we
have assumed the genuineness of all signatures, the authenticity of all
documents, agreements and instruments submitted to us as originals, the
conformity to original documents, agreements and instruments of all documents,
agreements and instruments submitted to us as copies or specimens, the
authenticity of the originals of such documents, agreements and instruments
submitted to us as copies or specimens, and the accuracy of the matters set
forth in the documents, agreements and instruments we reviewed. As to any facts
material to such opinion that were not known to us, we have relied upon
statements and representations of officers and other representatives of the
Company. Except as expressly set forth
<PAGE>
The Bear Stearns Companies Inc. -2- January 11,2001
herein, we have not undertaken any independent investigation (including, without
limitation, conducting any review, search or investigation of any public files,
records or dockets) to determine the existence or absence of the facts that are
material to our opinion, and no inference as to our knowledge concerning such
facts should be drawn from our reliance on the representations of the Company in
connection with the preparation and delivery of this letter. In addition, we
have assumed that the Notes will be executed and delivered in substantially the
form in which they are filed as an exhibit to the Registration Statement.
We are members of the Bar of the State of New York, and in rendering the opinion
below, we do not purport to be an expert in, or express any opinion concerning,
the laws of any jurisdiction other than the federal tax laws of the United
States of America.
Based upon and subject to the qualifications set forth herein, we are of the
opinion that:
The statements made in the Prospectus Supplement, under the caption "Certain
United States Federal Income Tax Considerations," insofar as such statements
purport to summarize certain federal income tax laws of the United States or
legal conclusions with respect thereto, have been reviewed by us and constitute
a fair summary of the principal U.S. federal tax consequences of the purchase,
ownership and disposition of the Notes. All such statements are based upon
current law, which is subject to change, possibly with retroactive effect.
Further, there can be no assurance that the Internal Revenue Service will not
take a contrary position.
We assume no obligation to update or supplement this letter to reflect any
facts, circumstances, laws, rules or regulations, or any changes thereto, or any
court or other authority or body decisions or governmental or regulatory
authority determinations which may hereafter occur or come to our attention.
We hereby consent to the filing of this opinion letter as an exhibit to the
Registration Statement and to the reference to this Firm in the Prospectus
Supplement constituting a part of the Registration Statement under the caption
"Validity of the Notes," without admitting that we are "experts" within the
meaning of the Securities Act or the rules and regulations of the Commission
issued thereunder with respect to any part of the Registration Statement,
including this exhibit.
Very truly yours,
/s/ CADWALADER, WICKERSHAM & TAFT
