Bear Stearns Medium-Term Notes, Series B – Appointment of Additional Agents and Terms Agreement (2003)

Summary

This agreement, dated January 30, 2003, is between The Bear Stearns Companies Inc. and several financial firms, including Bear, Stearns & Co. Inc., Aegis Capital Corporation, Oberlin Financial Corporation, The Stanford Group Co., Inc., and Thomas Weisel Partners LLC. It appoints these firms as additional agents for the issuance and sale of $10 million in Principal Protected Sector Selector Notes due 2008. The agreement outlines the purchase terms, payment methods, maturity date, and calculation of returns based on the performance of selected sector ETFs. No interest is paid until maturity, when principal and any variable return are paid.

EX-1.(I) 4 be664673-ex1i.txt APPOINTMENT OF ADDITIONAL AGENTS AND TERMS AGMT Exhibit 1(i) THE BEAR STEARNS COMPANIES INC. MEDIUM-TERM NOTES, SERIES B APPOINTMENT OF ADDITIONAL AGENTS AND TERMS AGREEMENT ("TERMS AGREEMENT") January 30, 2003 Bear, Stearns & Co. Inc. 383 Madison Avenue New York, New York 10179 Aegis Capital Corporation 70 East Sunrise Highway Suite 415 Valley Stream, New York 11581 Oberlin Financial Corporation 209 North Main Bryan, Ohio 43506 The Stanford Group Co., Inc. 5050 Westheimer Houston, Texas 77056 Thomas Weisel Partners LLC One Montgomery Tower One Montgomery Street San Francisco, California 94104 Ladies and Gentlemen: In accordance with and subject to the terms and conditions stated herein and in the Distribution Agreement (as hereinafter defined), this Terms Agreement serves as confirmation of the appointment of each of the additional agents listed on the signature pages hereto (each an "Additional Agent") as Additional Agents pursuant to Section 2(a) of the Distribution Agreement, solely with respect to the issuance and sale by The Bear Stearns Companies Inc., a Delaware corporation (the "Company"), of its Principal Protected Sector Selector Notes Due 2008 (the "Sector Selector Notes"), as described in the pricing supplement dated January 30, 2003, to the Prospectus Supplement and Prospectus, each dated January 25, 2002, through the Additional Agents as principals. The Sector Selector Notes are a single series of debt securities under the Company's Medium-Term Notes, Series B program. This Terms Agreement also constitutes a terms agreement pursuant to Section 2(b) of the Distribution Agreement, pursuant to which the Company proposes to issue and sell the Sector Selector Notes to Bear, Stearns & Co. Inc. ("Bear Stearns") and to each of the Additional Agents, as principals, subject to the terms and conditions stated herein. Those provisions of the Distribution Agreement not specifically related to the solicitation by the Agents (as defined in the Distribution Agreement), as agents of the Company, of offers to purchase Notes (as defined in the Distribution Agreement), as modified by this Terms Agreement, are incorporated by reference herein. Nothing contained in this Terms Agreement or in the Distribution Agreement shall make any party to this Terms Agreement an agent of the Company or make such party subject to the provisions of the Distribution Agreement, in either case with respect to the solicitation of offers to purchase Notes from the Company, solely by virtue of such party's execution of this Terms Agreement. The term "Distribution Agreement" refers to the Distribution Agreement dated November 8, 1991, as amended by Amendment No. 1, dated as of December 4, 1991, and by Amendment No. 2, dated as of July 10, 1992, by and among the Company and Bear Stearns, Merrill Lynch & Co., Inc., Morgan Stanley (formerly, Morgan Stanley & Co. Incorporated), Salomon Smith Barney Inc. (formerly, Salomon Brothers Inc.) and Lehman Brothers Inc. (formerly, Shearson Lehman Brothers Inc.). Each of Bear Stearns and the undersigned Additional Agents hereby agree to purchase the aggregate principal amount of Sector Selector Notes set forth adjacent to their names on the signature pages to this Terms Agreement, at the time and place and at the purchase price set forth below. The terms of the Notes shall be as follows: Title: Principal Protected Sector Selector Notes Due 2008 Aggregate Principal Amount: $10,000,000 Public Offering Price: 100% Purchase Price by Bear Stearns: 97.5% Purchase Price by Additional Agents: 98.0% Methods of and Specified Funds for Payment of Purchase Price: By wire transfer to a bank account specified by the Company in immediately available funds. Indenture: The Indenture dated as of May 31, 1991, as amended by the First Supplemental Indenture, dated as of January 29, 1998, between the Company and JPMorgan Chase Bank (formerly known as Chemical Bank), as trustee. Settlement Date and Time: February 5, 2003; 9:00 a.m. Closing Location: Cadwalader, Wickersham & Taft 100 Maiden Lane New York, New York 10038 Maturity Date: February 5, 2008 Option to Extend Maturity Date: None Interest Rate: The Company will not make any periodic payments of interest or any other payments on the Sector Selector Notes, -2- until maturity. At maturity, the Company will pay the principal amount of the Sector Selector Notes plus a Variable Return Amount, if the Variable Return Amount is greater than zero. Variable Return Amount: Based on the performance of ten U.S. sector exchange traded funds issued by iShares Trust(R) (the "Sector ETFs") which comprise the basket, using a semi-annual performance selection mechanism over the five-year term of the Sector Selector Notes. On each semi-annual observation date, the Sector ETF with the most positive or least negative percentage change since the issue date of the Sector Selector Notes is "selected" and its performance rate is "locked in". That Sector ETF is then removed from the basket. At maturity, the Variable Return Amount will equal the arithmetic average of the ten selected performance rates. The Variable Return Amount will not be less than zero. The underlying U.S. Sector ETFs track the following sectors: Basic Materials, Consumer Cyclical, Consumer Non-Cyclical, Energy, Financial, Healthcare, Industrial, Technology, Telecommunications, and Utilities. Each of the U.S. Sector ETFs is quoted on the American Stock Exchange. Observation Dates: January 30th and July 30th of each year during the term of the Sector Selector Notes, subject to Modified Following Business Day convention. The first Observation Date will be July 30, 2003 and the last Observation Date will be January 30, 2008. CUSIP: 073928YH0 Minimum Denominations: $1,000, increased in multiples of $1,000 Form of Notes: Book-entry Listing: American Stock Exchange Ticker Symbol: BYF.A Calculation Agent: Bear Stearns -3- Bear Stearns and each Additional Agent expressly waives its right to receive from the Company the certificates, legal opinions and comfort letters provided for in Sections 5 and 6 of the Distribution Agreement. This Terms Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Transmission by telecopier or facsimile transmission of an executed counterpart of this Terms Agreement shall constitute due and sufficient delivery of such counterpart. Please confirm your acceptance of this Terms Agreement by signing and returning to us the enclosed duplicate copy hereof. [Signature Pages Follow] -4- THE BEAR STEARNS COMPANIES INC. By ------------------------------------- Name: Title: Accepted as of the date hereof: BEAR, STEARNS & CO. INC. By $7,948,000 -------------------------------- Name: Title: ADDITIONAL AGENTS: AEGIS CAPITAL CORPORATION By $85,000 -------------------------------- Name: Title: OBERLIN FINANCIAL CORPORATION By $8,000 -------------------------------- Name: Title: -5- THE STANFORD GROUP CO., INC. By $6,000 -------------------------------- Name: Title: THOMAS WEISEL PARTNERS LLC By $1,953,000 -------------------------------- Name: Title: -6-