Summary
Bank of America Corporation (BAC) filed an 8-K on January 29, 2016, to report on the issuance and terms of its 6.200% Non-Cumulative Preferred Stock, Series CC. The company issued 44,000,000 Depositary Shares, each representing a 1/1,000th interest in a share of the Series CC Preferred Stock, including the full exercise of an over-allotment option. This filing is significant as it details the rights and preferences associated with the Series CC Preferred Stock. Notably, the ability of Bank of America to pay dividends on or repurchase common stock or parity junior preferred stock is restricted if it fails to declare and pay full dividends on the Series CC Preferred Stock. Investors in this new preferred stock offering should note the non-cumulative nature of the dividends and the liquidation preference of $25,000 per share of Series CC Preferred Stock.
Key Highlights
- 1Bank of America issued 44,000,000 Depositary Shares representing interests in Series CC Preferred Stock on January 29, 2016.
- 2The Series CC Preferred Stock carries a fixed dividend rate of 6.200% and is non-cumulative.
- 3A key feature is a restriction on common stock and junior preferred stock dividends/repurchases if Series CC Preferred dividends are not paid in full.
- 4Each Depositary Share represents a 1/1,000th interest in a share of Series CC Preferred Stock.
- 5The Series CC Preferred Stock has a liquidation preference of $25,000 per share.
- 6The issuance included the full exercise of the underwriters' over-allotment option.
- 7The filing includes various agreements and opinions related to the issuance and sale of the Depositary Shares.