|
Free
Writing Prospectus
Filed
Pursuant to Rule 433
Registration
No. 333−136666
April 20, 2007 |
||||
|
|
New
Issue
|
Indicative
Terms
|
||
 |
||||
|
THE
BEAR STEARNS COMPANIES INC.
Note
Linked to a Portfolio of Indices and Index
Funds
|
||||
|
|
Due: May[l], 2012 | |||
|
|
INVESTMENT
HIGHLIGHTS
|
|||
|
·
|
5
year term to maturity.
|
|
|
·
|
The
Notes are 100% principal protected.
|
|
|
·
|
Issue
is a direct obligation of The Bear Stearns Companies Inc.
(Rated A1 by
Moody’s / A+ by S&P).
|
|
|
·
|
Issue
Price: 100.00% of the principal amount ($1,000 per
Note)
|
|
|
·
|
Linked
to the potential positive performance of a portfolio comprised
of eight
indices and two index funds. The following are the eight
indices and their
respective weightings in the portfolio: (1) 25% the Dow Jones
EURO STOXX
50® Index; (2) 20% the Nikkei 225™ Stock Index; (3) 10% the FTSE/Xinhua
China 25 Index; (4) 10% the CECEEUR Index; (5) 10% the FTSE
100 Index; (6)
5% the KOSPI 200 Index; (7) 5% the Swiss Market Index and
(8) 5% the
S&P/ASX 200 Index (each such index an “Index” and together the
“Indices”). The following are the two index funds and their respective
weightings in the portfolio: (1) 5% the iShares MSCI South
Africa Index
Fund and (2) 5% the iShares MSCI Taiwan Index Fund (each
such index fund
an “Index Fund” and together the “Index Funds”). Each such Index or Index
Fund will be a “Component” and the ten Components together will constitute
the “Portfolio”.
|
|
|
·
|
The
Cash Settlement Value will be based on the appreciation,
if any, in the
Portfolio over the term of the Notes as measured by the Portfolio
Return.
The “Portfolio Return” is calculated as the weighted average of the ten
Component Performances, where the “Component Performance” with respect to
a Component measures the average level of such Component
as of six
Observation Dates relative to its Initial Component Level
on the Pricing
Date (with [100.00-105.00]% Participation).
|
|
|
·
|
If,
at maturity, the Portfolio Return is greater than zero, the
Cash
Settlement Value for each Note will be equal to the principal
amount of
the Note, plus the product of: (i) $1,000 multiplied by (ii)
the Portfolio
Return, multiplied by (iii) the Participation Rate.
|
|
|
·
|
If,
at maturity, the Portfolio Return is equal to or less than
zero, the Cash
Settlement Value for each Note will be $1,000.
|
|
|
The
issuer has filed a registration statement (including a prospectus)
with
the SEC for the offering to which this free writing prospectus
relates.
Before you invest, you should read the prospectus in that registration
statement and other documents the issuer has filed with the SEC
for more
complete information about the issuer and this offering. You
may get these
documents for free by visiting EDGAR on the SEC Web site at
www.sec.gov. Alternatively,
the
issuer, any underwriter or any dealer participating in the offering
will
arrange to send you the prospectus if you request it by calling
toll free
1-866-803-9204.
|
||||
|
The
Notes will not be listed on any U.S. securities exchange or quotation
system. Neither the Securities and Exchange Commission nor any
state
securities commission has approved or disapproved of these securities
or
determined that this free writing prospectus is truthful or complete.
Any
representation to the contrary is a criminal
offense.
|
||||
1
 |
|
GENERAL
TERMS
|
This
free
writing prospectus relates to a Note offering linked
to
the potential positive performance of a portfolio comprised of
eight indices and
two index funds. The following are the eight indices and their
respective
weightings in the portfolio: (1) 25% the Dow Jones EURO STOXX 50® Index; (2) 20%
the Nikkei 225™ Stock Index; (3) 10% the FTSE/Xinhua 25 Index; (4) 10% the
CECEEUR Index; (5) 10% the FTSE 100 Index; (6) 5% the KOSPI 200
Index; (7) 5%
the Swiss Market Index and (8) 5% the S&P/ASX 200 Index (each such index an
“Index” and together the “Indices”). The following are the two index funds and
their respective weightings in the portfolio: (1) 5% the iShares
MSCI South
Africa Index Fund and (2) 5% the iShares MSCI Taiwan Index Fund
(each such index
fund an “Index Fund” and together the “Index Funds”). Each such Index or Index
Fund will be a “Component” and the ten Components together will constitute the
“Portfolio”. We reserve the right to withdraw, cancel or modify the offering
and
to reject orders in whole or in part. Defined
terms not defined herein shall have the same meaning as in the
Pricing
Supplement discussed below.
|
ISSUER:
|
The
Bear Stearns Companies Inc.
|
|
ISSUER’S
RATING:
|
A1
/ A+ (Moody’s / S&P)
|
|
CUSIP
NUMBER:
|
073928V59
|
|
ISSUE
PRICE:
|
100.00%
of the Principal Amount
|
|
PRINCIPAL
AMOUNT:
|
$[l]
|
|
DENOMINATIONS:
|
$50,000
per Note and $1,000 multiples thereafter
|
|
SELLING
PERIOD ENDS:
|
May
[l],
2007
|
|
SETTLEMENT
DATE:
|
May
[l],
2007
|
|
MATURITY
DATE:
|
May
[l],
2012 (for a term of approximately 60 months). The Maturity
Date is subject
to
adjustment
as described in the Pricing Supplement.
|
|
CASH
SETTLEMENT VALUE:
|
An
amount in cash that depends upon the Portfolio Return.
If, at maturity,
the Portfolio Return is greater than zero, then the Cash
Settlement Value
for each Note will be equal to:
|
|
Principal
Amount of Note + [$1,000 x Portfolio Return x Participation
Rate]
|
|
|
If,
at maturity, the Portfolio Return is equal to or less
than zero, then the
Cash Settlement Value for each Note will be $1,000. Because
the Notes are
principal protected if held to maturity, in no event
will the Cash
Settlement Value for each Note be less than $1,000.
|
|
|
PORTFOLIO
RETURN:
|
An
amount determined by the Calculation Agent and equal
to the sum of the
Component Performance for each Component multiplied by
its respective
Weight in the Portfolio.
|
|
COMPONENT
PERFORMANCE:
|
As
of the Final Observation Date and with respect to a Component,
the
quotient, expressed as a percentage, of (i) the arithmetic
average of the
Observation Levels for that Component as of each Observation
Date minus
the Initial Component Level of that Component divided
by (ii) the Initial
Component Level of that Component.
|
|
FINAL
OBSERVATION DATE:
|
May
[l],
2012.
|
|
OBSERVATION
LEVELS:
|
As
of any Observation Date and with respect to each Index,
the closing index
level as reported by the relevant Index Sponsor and displayed
on Bloomberg
Page SX5E <Index> <Go> with respect to the SX5E; Bloomberg
Page NKY <Index> <Go> with respect to the NKY; Bloomberg Page
XIN0I <Index> <Go> with respect to the XIN0I; Bloomberg Page
CECEEUR <Index> <Go> with respect to the CECEEUR; Bloomberg
Page UKX <Index> <Go> with respect to the UKX; Bloomberg Page
KOSPI2 <Index> <Go> with respect to the KOSPI2; Bloomberg Page
SMI <Index> <Go> with respect to the SMI; and Bloomberg Page
AS51 <Index> <Go> with respect to the AS51. As of any
Observation Date and with respect to each Index Fund,
the closing price as
reported by the Relevant Exchange and as displayed on
Bloomberg Page EZA
US <Equity> <Go> with respect to the EZA US; and Bloomberg
Page EWT US <Equity> <Go> with respect to the EWT
US.
|
FIFTH
THIRD SECURITIES, INC.
2
|
|
|
OBSERVATION
DATES:
|
December
[l],
2011, January [l],
2012, February [l],
2012, March [l],
2012, April [l],
2012, and May [l],
2012. The Observation Dates are subject to adjustment
as described in the
Pricing Supplement.
|
|
INTIAL
COMPONENT LEVELS:
|
[l]
with respect to the SX5E;
|
|
[l]
with respect to the NKY;
|
|
|
[l]
with respect to the XIN0I;
|
|
|
[l]
with respect to the CECEEUR;
|
|
|
[l]
with respect to the UKX;
|
|
|
[l]
with respect to the KOSPI2;
|
|
|
[l]
with respect to the SMI;
|
|
|
[l]
with respect to the AS51;
|
|
|
[l]
with respect to the EZA US; and
|
|
|
[l]
with respect to the EWT US.
|
|
|
WEIGHT:
|
25%
with respect to the SX5E;
|
|
20%
with respect to the NKY;
|
|
|
10%
with respect to the XIN0I;
|
|
|
10%
with respect to the CECEEUR;
|
|
|
10%
with respect to the UKX;
|
|
|
5%
with respect to the KOSPI2;
|
|
|
5%
with respect to the SMI;
|
|
|
5%
with respect to the AS51;
|
|
|
5%
with respect to the EZA US; and
|
|
|
5%
with respect to the EWT US.
|
|
|
INTEREST:
|
The
Notes will not bear interest.
|
|
PARTICIPATION
RATE:
|
[100.00-105.00]%
|
FIFTH
THIRD SECURITIES, INC.
3
|
|
|
COMPONENTS:
|
The
Notes are linked to the potential positive performance of a portfolio
comprised of eight indices and two index funds. The following are
the
eight indices and their respective weightings in the portfolio:
(1) 25%
the Dow Jones EURO STOXX 50® Index (“SX5E”); (2) 20% the Nikkei 225™ Stock
Index (“NKY”); (3) 10% the FTSE/Xinhua 25 Index (“XIN0I”); (4) 10% the
CECEEUR Index (“CECEEUR”); (5) 10% the FTSE 100 Index (“UKX”); (6) 5% the
KOSPI 200 Index (“KOSPI2”); (7) 5% the Swiss Market Index (“SMI”) and (8)
5% the S&P/ASX 200 Index (“AS51”) (each such index an “Index” and
together the “Indices”). The following are the two index funds and their
respective weightings in the portfolio: (1) 5% the iShares MSCI
South
Africa Index Fund (“EZA US”) and (2) 5% the iShares MSCI Taiwan Index Fund
(“EWT US”) (each such index fund an “Index Fund” and together the “Index
Funds”). Each such Index or Index Fund will be a “Component” and together
will constitute the “Portfolio”. The weighting of each Component is fixed
at the respective weighting mentioned above and will not change
during the
term of the Notes unless one or more Components are modified during
the
term of the Notes.
|
|
INDEX
SPONSORS:
|
STOXX
Limited, a partnership of Deutsche Börse AG, Dow Jones & Company and
the SWX Group as the sponsor of the Dow Jones EURO STOXX 50® Index; Nihon
Keizai Shimbun, Inc. as the sponsor of the Nikkei 225™ Stock Index;
FTSE/Xinhua Index Limited, a joint venture of FTSE International
Limited
and Xinhua Financial Network Limited, as the sponsor of the FTSE/Xinhua
China 25 Index; Wiener Börse as the sponsor of the CECEEUR Index; FTSE
International Limited as the sponsor of the FTSE 100 Index; Korea
Exchange
as the sponsor of the KOSPI 200 Index; Standard & Poor’s, a division
of The McGraw-Hill Companies, Inc., and the Australian Stock Exchange
as
sponsor of the S&P/ASX 200 Index; and the SWX Group as sponsor of the
Swiss Market Index are hereinafter referred to as “Index Sponsors.” See
“Description of the Portfolio” herein.
|
|
INDEX
FUND ISSUER:
|
iShares,
Inc., as the issuer of iShares MSCI South Africa Index Fund and
iShares
MSCI Taiwan Index Fund is hereinafter referred to as the “Index Fund
Issuer.” See “Description of the Portfolio”
herein.
|
FIFTH
THIRD SECURITIES, INC.
4
|
|
|
ADDITIONAL
TERMS SPECIFIC TO THE
NOTES
|
|
You
should read this document together with the prospectus and
prospectus
supplement, each dated August 16, 2006 (the “Prospectus” and “Prospectus
Supplement,” respectively), and the more detailed information contained
in
the Pricing Supplement, dated April 20, 2007 (subject to
completion) (the
“Pricing Supplement”). You should carefully consider, among other things,
the matters set forth in “Risk Factors” in the Prospectus Supplement and
the Pricing Supplement, as the Notes involve risks not associated
with
conventional debt securities. We urge you to consult your
investment,
legal, tax, accounting and other advisers before you invest
in the Notes.
You may access the Pricing Supplement, the Prospectus Supplement
and the
Prospectus on the SEC web site as
follows:
|
|
·
|
Pricing
Supplement dated April 20, 2007 (subject to
completion):
|
|
·
|
Prospectus
Supplement dated August 16, 2006:
|
|
·
|
Prospectus
dated August 16, 2006:
|
|
ILLUSTRATIVE
HYPOTHETICAL CASH SETTLEMENT VALUE
TABLE
|
|
The
following tables are for illustrative purposes and are
not indicative of
the future performance of the Components or the future
value of the
Notes.
The
following examples demonstrate how the hypothetical Cash
Settlement Value
of a Note is calculated based on the assumptions outlined
below. The
examples do not purport to be representative of every
possible scenario
concerning increases or decreases in the Portfolio or
the Components underlying the Portfolio. You should not
construe the
examples as an indication or assurance of the expected
performance of the
Notes. Actual returns may be different. The examples
demonstrating the
hypothetical Cash Settlement Value of a Note are based
on the following
assumptions:
|
ASSUMPTIONS:
|
·
|
Investor
purchases $1,000 aggregate principal amount of Notes
at the initial public
offering price of $1,000.
|
|
·
|
Investor
holds the Notes to maturity.
|
|
·
|
The
Participation Rate is [100.00]%.
|
|
·
|
The
Initial Component Level for the SX5E is equal to 4,200.00.
|
|
·
|
The
Initial Component Level for the NKY is equal to
17,300.00.
|
|
·
|
The
Initial Component Level for the XIN0I is equal to
15,700.00.
|
|
·
|
The
Initial Component Level for the CECEEUR is equal to
2,650.00.
|
|
·
|
The
Initial Component Level for the UKX is equal to
6,400.00.
|
|
·
|
The
Initial Component Level for the KOSPI2 is equal to
190.00.
|
|
·
|
The
Initial Component Level for the SMI is equal to
9,000.00.
|
|
·
|
The
Initial Component Level for the AS51 is equal to
6,000.00.
|
|
·
|
The
Initial Component Level for the EZA US is equal to
125.00.
|
|
·
|
The
Initial Component Level for the EWT US is equal to
14.00.
|
|
·
|
All
returns are based on a 60 month term, pre-tax
basis.
|
|
·
|
No
Market Disruption Events or Events of Default occur during
the term of the
Notes.
|
FIFTH
THIRD SECURITIES, INC.
5
|
|
Example
1: The Portfolio Return is greater than zero.
In
this
example, the levels of eight Components increase relative
to their Initial
Component Levels on the related Observation Dates, and the
levels of two
Components decrease relative to their Initial Component Levels
on the related
Observation Dates. This example illustrates how holders of
the Notes may benefit
from the increase in the Observation Level of some of the
Components relative to
their respective Initial Component Levels on each related
Observation
Date.
|
Index
|
Initial
Component Level
|
Observation
Date 1
|
Observation
Date 2
|
Observation
Date 3
|
Observation
Date 4
|
Observation
Date 5
|
Observation
Date 6
|
Component
Performance
|
Weight
in the Portfolio
|
|
SX5E
|
4,200.00
|
6,353
|
5,955
|
5,948
|
6,287
|
5,894
|
5,801
|
43.80%
|
25%
|
|
NKY
|
17,300.00
|
35,509
|
35,053
|
38,814
|
41,636
|
37,942
|
36,620
|
117.32%
|
20%
|
|
XIN0I
|
15,700.00
|
40,658
|
41,994
|
44,323
|
40,387
|
32,586
|
31,461
|
145.66%
|
10%
|
|
CECEEUR
|
2,650.00
|
9,868
|
10,565
|
10,676
|
10,657
|
11,493
|
12,327
|
312.49%
|
10%
|
|
UKX
|
6,400.00
|
6,975
|
6,877
|
7,135
|
7,540
|
7,977
|
8,175
|
16.35%
|
10%
|
|
KOSPI2
|
190.00
|
178
|
170
|
157
|
157
|
152
|
154
|
-15.09%
|
5%
|
|
SMI
|
9,000.00
|
6,176
|
6,162
|
5,751
|
6,139
|
6,001
|
5,809
|
-33.26%
|
5%
|
|
AS51
|
6,000.00
|
8,281
|
8,168
|
7,986
|
7,972
|
8,066
|
9,069
|
37.62%
|
5%
|
|
EZA
US
|
125.00
|
203
|
203
|
192
|
200
|
212
|
230
|
65.33%
|
5%
|
|
EWT
US
|
14.00
|
15
|
14
|
14
|
15
|
15
|
15
|
4.76%
|
5%
|
On
the
Final Observation Date, the Component Performance for SX5E
would be 43.80%, the
Component Performance for NKY would be 117.32%, the Component
Performance for
XIN0I would be 145.66%, the Component Performance for CECEEUR
would be 312.49%,
the Component Performance for UKX would be 16.35%, the Component
Performance for
KOSPI2 would be -15.09%, the Component Performance for SMI
would be -33.26%, the
Component Performance for AS51 would be 37.62%, the Component
Performance for
EZA US would be 65.33%, and the Component Performance for
EWT US would be 4.76%,
each as calculated pursuant to the below formula:
The
Portfolio Return is an amount equal to the sum of the Component
Performance for
each Component multiplied by its respective Weight in the
Portfolio.
Portfolio
Return = (43.80% x 25%) + (117.32% x 20%) + (145.66% x 10%)
+ (312.49% x 10%) +
(16.35% x 10%) + (-15.09 x 5%) + (-33.26% x 5%) + (37.62%
x 5%) + (65.33% x 5%)
+ (4.76% x 5%)
Portfolio
Return = 84.83%
The
Cash
Settlement Value, using the formula below, would equal $1,848.30.
| Cash Settlement Value = |  |
FIFTH
THIRD SECURITIES, INC.
6
|
|
Example
2: The Portfolio Return might be less than zero.
In
this
example, the Observation Levels of seven Components decrease
relative to their
Initial Component Levels on the related Observation Dates
and the Observation
Levels of three Components increase relative to their Initial
Component Levels
on the related Observation Dates. As a result, the Portfolio
Return would be
less than zero, and holders of the Notes would therefore
have received only the
principal amount of each Note at maturity.
|
Index
|
Initial
Component Level
|
Observation
Date 1
|
Observation
Date 2
|
Observation
Date 3
|
Observation
Date 4
|
Observation
Date 5
|
Observation
Date 6
|
Component
Performance
|
Weight
in the Portfolio
|
|
SX5E
|
4,200.00
|
2,284
|
2,100
|
2,206
|
2,348
|
2,252
|
2,273
|
-46.58%
|
25%
|
|
NKY
|
17,300.00
|
21,054
|
21,926
|
20,641
|
18,744
|
19,111
|
17,423
|
14.55%
|
20%
|
|
XIN0I
|
15,700.00
|
11,821
|
12,151
|
12,294
|
12,237
|
13,057
|
13,425
|
-20.40%
|
10%
|
|
CECEEUR
|
2,650.00
|
2,299
|
2,404
|
2,288
|
2,260
|
2,125
|
2,322
|
-13.85%
|
10%
|
|
UKX
|
6,400.00
|
7,800
|
8,144
|
7,660
|
7,653
|
7,723
|
7,177
|
20.20%
|
10%
|
|
KOSPI2
|
190.00
|
102
|
99
|
96
|
93
|
92
|
93
|
-49.56%
|
5%
|
|
SMI
|
9,000.00
|
4,803
|
4,946
|
5,182
|
5,440
|
5,380
|
5,390
|
-42.33%
|
5%
|
|
AS51
|
6,000.00
|
3,906
|
4,097
|
4,555
|
4,517
|
4,374
|
4,404
|
-28.19%
|
5%
|
|
EZA
US
|
125.00
|
77
|
73
|
75
|
81
|
87
|
99
|
-34.40%
|
5%
|
|
EWT
US
|
14.00
|
16
|
15
|
15
|
15
|
16
|
15
|
9.52%
|
5%
|
On
the
Final Observation Date, the Component Performance for SX5E
would be -46.58%, the
Component Performance for NKY would be 14.55%, the Component
Performance for
XIN0I would be -20.40%, the Component Performance for CECEEUR
would be -13.85%,
the Component Performance for UKX would be 20.20%, the Component
Performance for
KOSPI2 would be -49.56%, the Component Performance for SMI
would be -42.33%, the
Component Performance for AS51 would be -28.19%, the Component
Performance for
EZA US would be -34.40%, and the Component Performance for
EWT US would be
9.52%, each as calculated pursuant to the below formula:
In
this
example, using the formula below, the Portfolio Return would
be less than
zero.
The
Portfolio Return is an amount equal to the sum of the Component
Performance for
each Component multiplied by its respective Weight in the
Portfolio.
Portfolio
Return = (-46.58% x 25%) + (14.55% x 20%) + (-20.40% x 10%)
+ (-13.85% x 10%) +
(20.20% x 10%) + (-49.56x 5%) + (-42.33% x 5%) + (-28.19%
x 5%) + (-34.40% x 5%)
+ (9.52% x 5%)
Portfolio
Return = -17.39%
Since
the
Portfolio Return would be less than zero, the Cash Settlement
Value for each
Note would be the principal amount of $1,000.
FIFTH
THIRD SECURITIES, INC.
7
|
|
Example
3: Some Components move higher while others move lower.
In
this
example, the Observation Levels for four of the Components
increase relative to
the Initial Component Levels for those Components, while
the Observation Levels
for the six other Components decrease relative to the Initial
Component Levels
for those Components.
|
Index
|
Initial
Component Level
|
Observation
Date 1
|
Observation
Date 2
|
Observation
Date 3
|
Observation
Date 4
|
Observation
Date 5
|
Observation
Date 6
|
Component
Performance
|
Weight
in the Portfolio
|
|
SX5E
|
4,200.00
|
3,590
|
3,991
|
4,287
|
4,498
|
4,733
|
4,422
|
1.27%
|
25%
|
|
NKY
|
17,300.00
|
15,705
|
15,737
|
15,498
|
15,519
|
15,699
|
15,323
|
-9.94%
|
20%
|
|
XIN0I
|
15,700.00
|
30,611
|
31,784
|
33,513
|
35,011
|
36,270
|
32,804
|
112.31%
|
10%
|
|
CECEEUR
|
2,650.00
|
1,594
|
1,525
|
1,428
|
1,387
|
1,343
|
1,299
|
-46.06%
|
10%
|
|
UKX
|
6,400.00
|
6,198
|
6,619
|
6,199
|
6,044
|
6,114
|
6,739
|
-1.27%
|
10%
|
|
KOSPI2
|
190.00
|
255
|
239
|
221
|
214
|
224
|
230
|
21.32%
|
5%
|
|
SMI
|
9,000.00
|
12,848
|
13,778
|
12,602
|
13,208
|
13,284
|
13,301
|
46.34%
|
5%
|
|
AS51
|
6,000.00
|
5,455
|
5,266
|
5,523
|
5,618
|
5,867
|
6,357
|
-5.32%
|
5%
|
|
EZA
US
|
125.00
|
99
|
105
|
108
|
103
|
101
|
105
|
-17.20%
|
5%
|
|
EWT
US
|
14.00
|
10
|
10
|
11
|
11
|
12
|
11
|
-22.62%
|
5%
|
On
the
Final Observation Date, the Component Performance for SX5E
would be 1.27%, the
Component Performance for NKY would be -9.94%, the Component
Performance for
XIN0I would be 112.31%, the Component Performance for CECEEUR
would be -46.06%,
the Component Performance for UKX would be -1.27%, the Component
Performance for
KOSPI2 would be 21.32%, the Component Performance for SMI
would be 46.34%, the
Component Performance for AS51 would be -5.32%, the Component
Performance for
EZA US would be -17.20%, and the Component Performance for
EWT US would be
-22.62%, each as calculated pursuant to the below formula:
In
this
example, using the formula below, the Portfolio Return would
be greater than
zero.
The
Portfolio Return is an amount equal to the sum of the Component
Performance for
each Component multiplied by its respective Weight in the
Portfolio.
Portfolio
Return = (1.27% x 25%) + (-9.94% x 20%) + (112.31% x 10%)
+ (-46.06% x 10%) +
(-1.27% x 10%) + (21.32x 5%) + (46.34% x 5%) + (-5.32% x
5%) + (-17.20% x 5%) +
(-22.62% x 5%)
Portfolio
Return = 5.95%
The
Cash
Settlement Value, using the formula below, would equal $1,059.50.
| Cash Settlement Value: = |  |
FIFTH
THIRD SECURITIES, INC.
8
|
|
|
SELECTED
RISK CONSIDERATIONS
|
|
·
|
No
current income—We
will not pay any interest on the
Notes.
|
|
·
|
Non-conventional
return—The
yield on the Notes therefore may
be less than the overall return you
would
earn if you purchased a conventional
debt security at the same time and
with the same maturity.
|
|
·
|
No
interest, dividend or other payments—You
will not receive any interest, dividend
payments or other distributions on
the stocks or indices underlying
the Components; nor will such payments
be
included in the calculation of the
Cash Settlement Value you will receive
at maturity.
|
|
·
|
Not
exchange-listed—The
Notes will not be listed on any securities
exchange or quotation system
and we do not expect a trading market
to develop, which may affect the
price that you receive for your Notes
upon any sale prior to maturity.
If
you sell the Notes prior to maturity,
you may receive less, and possibly
significantly less, than your initial
investment in the
Notes.
|
|
·
|
Liquidity—Because
the Notes will not be listed on any
securities exchange or quotation
system, we do not expect a trading
market to develop, and, if such a
market were to develop, it may not
be liquid. Fifth Third Securities,
Inc.
has advised us that they intend under
ordinary market conditions to
indicate prices for the Notes on
request. However, we cannot guarantee
that bids for outstanding Notes will
be made in the future; nor can we
predict the price at which those
bids will be made. In any event,
Notes
will cease trading as of the close
of business on the Maturity Date.
|
|
·
|
The
Components may not move in tandem—At
a time when the level or price of
one or more of the Components increases,
the level or price of one or more
of the other Components may decline.
Therefore, in calculating the Portfolio
Return, increases in the level or
price of one or more of the Components
may be moderated, or wholly offset,
by lesser increases or declines in
the level or price of one or more
of
the other Components.
|
FIFTH
THIRD SECURITIES, INC.
9