Bear Stearns (NYSE: BSC) shareholders hoping for a higher offer from J.P. Morgan (NYSE: JPM) might as well call it quits now. Chairman James Cayne sold his entire 5.66 million share stake at $10.84/share for a paltry $61.3 million just weeks after it was worth nearly $380 million. Despite the news, shares rallied to $11.23 before falling after hours to $10.70, which is still above the planned $10.00 per share offer.

A letter filed with the SEC also revealed several other provisions that put the proverbial nail in the coffin. Among them, a provision saying that enables the company to bypass shareholder approval because securing such approval would "seriously jeopardize" the financial viability of the company. Essentially the company is saying that the owners are not responsible enough to make a decision about the future of their own company.

Shares have been trading up recently on speculation that the unhappy James Cayne would try and assemble a competitive offer with billionaire financier Joseph Lewis - the company's second largest shareholder. However, any deal of that sort seems unlikely unless it was Joseph Lewis who received his shares in a private transaction. This possibility seems to be the only thing left keeping shares above the buyout price.

Traders remain divided on the idea of a higher bid. One camp argues that J.P. Morgan's large stake would make it nearly impossible for another bidder to successfully emerge. The other contends that the equity portion of the deal pales in comparison to the assumed debt, which means that a higher offer is entirely possible (as we've already seen with the $2 to $10 jump). However, in the end, the fact that the company has agreed to the $10 offer along with J.P. Morgan's large stake all but seals the deal for this one.

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