8-KShareholder MattersCorporate ChangesExhibits & Filings

BANK OF AMERICA CORP /DE/ 8-K Report, Rights Modification (May 7, 2014)

Filed May 7, 2014For Securities:BACBAC-PBBAC-PKBAC-PLBAC-PMBAC-PNBAC-PSBML-PJBAC-PEBAC-PPBAC-PQBACRPBML-PGBML-PHBML-PLBAC-POMER-PK

Summary

Bank of America Corporation (BAC) filed an 8-K on May 7, 2014, detailing amendments to its Series T Preferred Stock and reporting on the outcomes of its annual stockholder meeting. The most significant event for investors is the modification of the terms for the 6% Non-Cumulative Perpetual Preferred Stock, Series T. These changes, approved by a supermajority of Series T stockholders and a majority of other voting stock, fundamentally alter the dividend structure and redemption terms. Key among these changes is the shift from cumulative to non-cumulative dividends, meaning dividends will now only be paid if declared by the Board of Directors. The dividend rate remains fixed at 6%, but the company also gained the flexibility to redeem this preferred stock only after May 7, 2019. Additionally, the annual meeting saw the election of all director nominees, approval of executive compensation (Say on Pay), and ratification of PricewaterhouseCoopers LLP as the auditor. Notably, all stockholder-initiated proposals, including those on cumulative voting, proxy access, and various reports, were rejected by shareholders.

Key Highlights

  • 1Amendment approved for the terms of the 6% Non-Cumulative Perpetual Preferred Stock, Series T.
  • 2Dividends on Series T Preferred Stock are now non-cumulative and subject to Board declaration.
  • 3The dividend rate for Series T Preferred Stock remains fixed at 6%.
  • 4Redemption of Series T Preferred Stock is now restricted to periods after May 7, 2019.
  • 5All director nominees were elected at the annual stockholder meeting.
  • 6Stockholders approved the advisory vote on executive compensation ('Say on Pay').
  • 7The appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for 2014 was ratified.
  • 8All eight stockholder proposals, including those on voting rights and reporting, were not approved.

Frequently Asked Questions

The primary impact for holders of Series T Preferred Stock is that dividends are now non-cumulative. This means dividends will only be paid if the Board of Directors declares them, and any missed dividend payments will not accrue or be payable in the future. The company also gained the ability to redeem the stock only after May 7, 2019.

The amendment was approved by a significant majority of the Series T Preferred Stock shares, voting as a separate class, and also by a majority of the combined vote of the Company's common stock, Series B Preferred Stock, and Series 1 to 5 Preferred Stock.

Shareholders elected all director nominees, approved the advisory vote on executive compensation (Say on Pay), and ratified the appointment of PricewaterhouseCoopers LLP as the auditor. However, all stockholder-initiated proposals, such as those related to cumulative voting, proxy access, and various reports, were not approved.

This specific 8-K filing primarily details changes to the terms of a specific class of preferred stock (Series T) and the results of the annual meeting. While changes to preferred stock terms can indirectly influence the company's capital structure and financial flexibility, the direct impact on BAC's common stock price is typically less immediate compared to news about earnings or major strategic shifts.