CSBJ Daily

J. P. Morgan Chase and Co. and The Bear Stearns Companies have revised their merger agreement, calling for common stock to sell for $10 per share, up from $2 per share.

In addition, both companies entered into a share purchase agreement under which J. P. Morgan Chase will purchase 95 million in newly issued shares of Bear Stearns common stock, or 39.5 percent of the outstanding Bear Stearns common stock. Purchase of the shares is expected to close by April 8.

Boards of directors of both companies have approved the amended agreement and J. P. Morgan has also agreed to guarantee Bear Stearns’ borrowings from the Federal Reserve Bank of New York.

The New York Fed’s special financing of $30 billion has also been amended so that J.P. Morgan will bear the first $1 billion of any losses associated with the financing of Bear Stearns’ assets. The Fed will fund the remaining $29 billion on a non-recourse basis to J. P. Morgan Chase.