美国银行发行80亿美元无担保优先中期票据，属常规融资备案

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Table of Contents
Filed pursuant to Rule 424(b)(5)
Registration No. 333-277673
Pricing Supplement
(To Prospectus dated March 28, 2024 and
Prospectus Supplement dated March 28, 2024)
October 16, 2026
$8,000,000,000
Medium-Term Notes, Series N
$500,000,000 Floating Rate Senior Notes, due October 2029
$2,000,000,000 5.385% Fixed/Floating Rate Senior Notes, due October 2029
$2,750,000,000 5.748% Fixed/Floating Rate Senior Notes, due October 2032
$2,750,000,000 6.062% Fixed/Floating Rate Senior Notes, due October 2037
This pricing supplement describes four series of our senior notes that will be issued under our Medium-Term Note Program, Series N. We
refer to our Floating Rate Senior Notes, due October 2029 as the “
floating rate notes
,” to our 5.385% Fixed/Floating Rate Senior Notes, due October 2029 as the “
3-year
fixed/floating rate notes
,” to our 5.748% Fixed/Floating Rate Senior Notes, due October 2032 as the “
6-year
fixed/floating rate notes
” and to our 6.062% Fixed/Floating Rate Senior
Notes, due October 2037 as the “
11-year
fixed/floating rate notes
.” We refer to the
3-year
fixed/floating rate notes, the
6-year
fixed/floating rate notes and the
11-year
fixed/floating rate notes collectively as the “
fixed/floating rate notes
,” and to the floating rate notes
and the fixed/floating rate notes collectively as the “
notes
.”
The floating rate notes mature on October 20, 2029.
We will pay interest on the floating rate notes at a floating rate per annum equal to compounded SOFR, plus 0.740%, payable quarterly. The
3-year
fixed/floating rate notes mature on October 20, 2029. We
will pay interest on the
3-year
fixed/floating rate notes (a) from, and including, October 20, 2026 to, but excluding, October 20, 2028, at a fixed rate of 5.385% per annum, payable
semi-annually, and (b) from, and including, October 20, 2028 to, but excluding, the maturity date, at a floating rate per annum equal to compounded SOFR, plus 0.740%, payable quarterly. The
6-year
fixed/floating rate notes mature on October 20, 2032. We will pay interest on the
6-year
fixed/floating rate notes (a) from, and including, October 20, 2026 to, but excluding, October 20,
2031, at a fixed rate of 5.748% per annum, payable semi-annually, and (b) from, and including, October 20, 2031 to, but excluding, the maturity date, at a floating rate per annum equal to compounded SOFR, plus 1.080%, payable quarterly.
The
11-year
fixed/floating rate notes mature on October 20, 2037. We will pay interest on the
11-year
fixed/floating rate notes (a) from, and including,
October 20, 2026 to, but excluding, October 20, 2036, at a fixed rate of 6.062% per annum, payable semi-annually, and (b) from, and including, October 20, 2036 to, but excluding, the maturity date, at a floating rate per annum
equal to compounded SOFR, plus 1.300%, payable quarterly.
We will have the option to redeem each series of the notes prior to the
applicable stated maturity as described in this pricing supplement under the heading “—Optional Redemption” for each series of the notes.
The notes are unsecured and rank equally in right of payment with all of our other unsecured and unsubordinated obligations from time to time
outstanding, except obligations that are subject to any priorities or preferences by law. We do not intend to list the notes on any securities exchange.
Investing in the notes involves risks. See “
Risk Factors Relating to the Notes
” beginning on page
S-9
of the accompanying prospectus supplement and “
Risk Factors
” beginning on page 8 of the accompanying prospectus.
None of the Securities and Exchange Commission, any state securities commission, or any other regulatory body has approved or disapproved of the
notes or passed upon the adequacy or accuracy of this pricing supplement, the accompanying prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.
Floating
Rate Notes
3-Year
Fixed/Floating
Rate Notes
6-Year
Fixed/Floating
Rate Notes
11-Year Fixed/Floating
Rate Notes
Per Note
Total
Per Note
Total
Per Note
Total
Per Note
Total
Public Offering Price
100.000
%
$
500,000,000
100.000
%
$
2,000,000,000
100.000
%
$
2,750,000,000
100.000
%
$
2,750,000,000
Selling Agents’ Commission
0.200
%
$
1,000,000
0.200
%
$
4,000,000
0.350
%
$
9,625,000
0.450
%
$
12,375,000
Proceeds (before expenses)
99.800
%
$
499,000,000
99.800
%
$
1,996,000,000
99.650
%
$
2,740,375,000
99.550
%
$
2,737,625,000
We expect to deliver the notes in book-entry only form through the facilities of The Depository Trust Company on
October 20, 2026.
Sole Book-Runner
BofA
Securities
ANZ Securities
Apto Partners, LLC
Banco Sabadell
BMO Capital Markets
BNY Capital Markets
C.L. King & Associates
CastleOak Securities, L.P.
CIBC Capital Markets
Citizens Capital Markets
Commonwealth Bank of Australia
Fifth Third Securities
First Citizens Capital Securities
Goodbody
Huntington Capital Markets
KeyBanc Capital Markets
Lloyds Securities
M&T Securities
Mizuho
nabSecurities, LLC
Natixis
Nomura
Nordea
PNC Capital Markets LLC
Rabo Securities
Raiffeisen Bank International
Ramirez & Co., Inc.
Scotiabank
Siebert Williams Shank
SMBC Nikko
Standard Chartered Bank
TD Securities
Truist Securities
UniCredit
Westpac Capital Markets LLC
Table of Contents
SPECIFIC TERMS OF THE NOTES
The descriptions of certain specific terms of the notes set forth below supplement, and should be read together with, the description of our
Medium-Term Notes, Series N included in “Description of the Notes” in the accompanying prospectus supplement dated March 28, 2024 and the general description of our debt securities included in “Description of Debt
Securities” in the accompanying prospectus also dated March 28, 2024.
If there is any inconsistency or conflict between the
information in this pricing supplement and in the accompanying prospectus supplement or prospectus, the information in this pricing supplement will govern and control. Capitalized or other defined terms used, but not defined, in this pricing
supplement have the same meanings as are given to them in the accompanying prospectus supplement or prospectus, as applicable.
Terms of
the Floating Rate Notes
•
Title of the Series:
Floating Rate Senior Notes, due October 2029
•
Type of Notes:
Floating rate notes
•
Specified Currency:
U.S. dollars
•
Issue Price:
100%
•
Aggregate Principal Amount Initially Being Issued:
$500,000,000
•
Issue Date
:
October 20, 2026
•
CUSIP No.:
06051GNF2
•
ISIN:
US06051GNF27
•
Maturity Date:
October 20, 2029
•
Minimum Denominations:
$2,000 and multiples of $1,000 in excess of $2,000
•
Ranking:
Senior
•
Interest Rate:
Base Rate plus the Spread per annum, payable quarterly in arrears for each quarterly Interest Period. The floating rate notes will be “compounded SOFR notes” as such term is defined in the accompanying prospectus
supplement.
•
Base Rate:
Compounded SOFR, which is a compounded average of daily SOFR (the Secured Overnight Financing Rate) as determined for each quarterly Interest Period as set forth under “Description of the Notes—Floating-Rate
Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA—Determination of Compounded SOFR (Payment Delay)” in the accompanying prospectus supplement.
•
Spread:
74 basis points
•
Payment Delay Convention:
Applicable. Accrued interest, Interest Periods, the interest rate and timing of interest payments for a particular Interest Period, among other terms and
PS-2
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provisions of the floating rate notes, will be determined as set forth under “Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and
Compounded AONIA” in the accompanying prospectus supplement.
•
Interest Periods:
Each quarterly period from, and including, an Interest Period Demarcation Date (or, in the case of the first Interest Period, the Issue Date) to, but excluding, the next Interest Period Demarcation Date (or, in the case of the
final Interest Period, the Maturity Date or, if the floating rate notes are redeemed earlier, the redemption date).
•
Interest Period Demarcation Dates:
The 20
th
of each January, April, July and October, commencing January 20, 2027 and ending on the Maturity Date (or, if the floating rate notes are redeemed earlier, ending
on the redemption date).
•
Interest Payment Dates:
The second Business Day following each Interest Period Demarcation Date; provided that the Interest Payment Date with respect to the final Interest Period will be the Maturity Date or, if the floating rate notes are redeemed
earlier, the redemption date.
•
Rate
Cut-Off
Date:
The second U.S. government securities business day prior to the Maturity Date or redemption date, as applicable.
For purposes of calculating compounded SOFR with respect to the final Interest Period,
the level of SOFR for each U.S. government securities business day in the period from, and including, the Rate
Cut-Off
Date to, but excluding, the Maturity Date or redemption date, as applicable, will be the
level of SOFR in respect of such Rate
Cut-Off
Date.
•
Optional Redemption:
We may redeem the floating rate notes at our option, (a) in whole, but not in part, on October 20, 2028, or (b) in whole at any time or in part from time to time, on or after September 19, 2029 and prior to
the Maturity Date, in each case, upon at least 5 business days’ but not more than 60 calendar days’ prior written notice to holders of the floating rate notes being redeemed at a redemption price equal to 100% of the principal amount of
the floating rate notes being redeemed, plus accrued and unpaid interest, if any, thereon to, but excluding, the redemption date.
•
Day Count Convention:
Actual/360.
PS-3
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•
Business Days:
New York/Charlotte and U.S. government securities business day.
•
Business Day Convention:
Modified following business day convention (adjusted).
Terms of the
3-Year
Fixed/Floating Rate Notes
•
Title of the Series:
5.385% Fixed/Floating Rate Senior Notes, due October 2029
•
Type of Notes:
Fixed/floating rate notes
•
Specified Currency:
U.S. dollars
•
Issue Price:
100%
•
Aggregate Principal Amount Initially Being Issued:
$2,000,000,000
•
Issue Date
:
October 20, 2026
•
CUSIP No.:
06051GNE5
•
ISIN:
US06051GNE51
•
Maturity Date:
October 20, 2029
•
Minimum Denominations:
$2,000 and multiples of $1,000 in excess of $2,000
•
Ranking:
Senior
•
Fixed Interest Rate:
5.385% per annum, payable semi-annually in arrears for each semi-annual Interest Period during the period from, and including, the Issue Date to, but excluding, October 20, 2028 (the
“
3-Year
Fixed Rate Period
”).
•
Floating Interest Rate:
Base Rate plus the Spread per annum, payable quarterly in arrears for each quarterly Interest Period during the period from, and including, October 20, 2028 to, but excluding, the Maturity Date (the “
3-Year
Floating Rate Period
”). During the
3-Year
Floating Rate Period, the
3-year
fixed/floating rate notes will be
“compounded SOFR notes” as such term is defined in the accompanying prospectus supplement.
•
Base Rate:
Compounded SOFR, which is a compounded average of daily SOFR (the Secured Overnight Financing Rate) as determined for each quarterly Interest Period during the
3-Year
Floating Rate Period
as set forth under “Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA—Determination of Compounded SOFR (Payment Delay)” in
the accompanying prospectus supplement.
PS-4
Table of Contents
•
Spread:
74 basis points
•
Payment Delay Convention:
Applicable. During the
3-Year
Floating Rate Period, accrued interest, Interest Periods, the interest rate and timing of interest payments for a particular Interest Period, among other terms
and provisions of the
3-year
fixed/floating rate notes, will be determined as set forth under “Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR,
Compounded SONIA, Compounded CORRA and Compounded AONIA” in the accompanying prospectus supplement.
•
Interest Periods:
During the
3-Year
Fixed Rate Period, each semi-annual period from, and including, an Interest
Payment Date (or, in the case of the first Interest Period, the Issue Date) to, but excluding, the next Interest Payment Date (or, if the
3-year
fixed/floating rate notes are redeemed earlier, the redemption
date).
During the
3-Year
Floating Rate
Period, each quarterly period from, and including, an Interest Period Demarcation Date (or in the case of the first Interest Period during the
3-Year
Floating Rate Period, the scheduled Interest Payment Date
of October 20, 2028 (adjusted, if applicable, as set forth under “Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA—General
Terms and Provisions Applicable to the Notes Using the Payment Delay Convention” in the accompanying prospectus supplement)) to, but excluding, the next Interest Period Demarcation Date (or, in the case of the final Interest Period, the
Maturity Date or, if the
3-year
fixed/floating rate notes are redeemed earlier, the redemption date).
•
Interest Period Demarcation Dates during the
3-Year
Floating Rate Period:
The 20
th
of each January, April, July and October, commencing January 20, 2029 and ending on the Maturity Date (or, if the
3-year
fixed/floating rate notes are redeemed earlier, ending on the redemption date).
•
Interest Payment Dates:
During the
3-Year
Fixed Rate Period, April 20 and October 20 of each year, beginning
April 20, 2027 and ending on October 20, 2028.
During the
3-Year
Floating Rate Period, the second Business Day following each Interest Period Demarcation Date; provided that the Interest Payment Date with respect to the final Interest Period will be the Maturity Date or,
if the
3-year
fixed/floating rate notes are redeemed earlier, the redemption date.
PS-5
Table of Contents
•
Rate
Cut-Off
Date:
The second U.S. government securities business day prior to the Maturity Date or redemption date, as applicable.
For purposes of calculating compounded SOFR with respect to the final Interest Period,
the level of SOFR for each U.S. government securities business day in the period from, and including, the Rate
Cut-Off
Date to, but excluding, the Maturity Date or redemption date, as applicable, will be the
level of SOFR in respect of such Rate
Cut-Off
Date.
•
Optional Redemption:
We may redeem the
3-year
fixed/floating rate notes at our option, (a) in whole, but not in
part, on October 20, 2028, or (b) in whole at any time or in part from time to time, on or after September 19, 2029 and prior to the Maturity Date, in each case, upon at least 5 business days’ but not more than 60 calendar
days’ prior written notice to holders of the
3-year
fixed/floating rate notes being redeemed at a redemption price equal to 100% of the principal amount of the
3-year
fixed/floating rate notes being redeemed, plus accrued and unpaid interest, if any, thereon to, but excluding, the redemption date.
In addition, we may redeem the
3-year
fixed/floating rate notes at our option, in whole at any time or in part from time to time, on or after April 20, 2027 (or, if additional
3-year
fixed/floating rate notes are issued after October 20,
2026, on or after the date that is six months after the issue date of such additional
3-year
fixed/floating rate notes), and prior to October 20, 2028 (which is the last day of the “remaining
term” of the
3-year
fixed/floating rate notes for purposes of such redemption), upon at least 5 business days’ but not more than 60 calendar days’ prior written notice to the holders of the
3-year
fixed/floating rate notes being redeemed, pursuant to a “make-whole redemption” at the applicable “make-whole” redemption price, in accordance with the applicable terms and provisions
set forth in the accompanying prospectus supplement under the heading “Description of the Notes—Redemption—Make-Whole Redemption.” The applicable “spread” to be added to the treasury rate for the
“make-whole” redemption price is 10 basis points.
PS-6
Table of Contents
Terms of the
6-Year
Fixed/Floating Rate Notes
•
Title of the Series:
5.748% Fixed/Floating Rate Senior Notes, due October 2032
•
Type of Notes:
Fixed/floating rate notes
•
Specified Currency:
U.S. dollars
•
Issue Price:
100%
•
Aggregate Principal Amount Initially Being Issued:
$2,750,000,000
•
Issue Date
:
October 20, 2026
•
CUSIP No.:
06051GNG0
•
ISIN:
US06051GNG00
•
Maturity Date:
October 20, 2032
•
Minimum Denominations:
$2,000 and multiples of $1,000 in excess of $2,000
•
Ranking:
Senior
•
Fixed Interest Rate:
5.748% per annum, payable semi-annually in arrears for each semi-annual Interest Period during the period from, and including, the Issue Date to, but excluding, October 20, 2031 (the
“
6-Year
Fixed Rate Period
”).
•
Floating Interest Rate:
Base Rate plus the Spread per annum, payable quarterly in arrears for each quarterly Interest Period during the period from, and including, October 20, 2031 to, but excluding, the Maturity Date (the “
6-Year
Floating Rate Period
”). During the
6-Year
Floating Rate Period, the
6-year
fixed/floating rate notes will be
“compounded SOFR notes” as such term is defined in the accompanying prospectus supplement.
•
Base Rate:
Compounded SOFR, which is a compounded average of daily SOFR (the Secured Overnight Financing Rate) as determined for each quarterly Interest Period during the
6-Year
Floating Rate Period
as set forth under “Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA—Determination of Compounded SOFR (Payment Delay)” in
the accompanying prospectus supplement.
•
Spread:
108 basis points
•
Payment Delay Convention:
Applicable. During the
6-Year
Floating Rate Period, accrued interest, Interest Periods, the interest rate and timing of interest payments for a particular Interest Period, among other terms
and provisions of the
PS-7
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6-year
fixed/floating rate notes, will be determined as set forth under “Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR, Compounded
SONIA, Compounded CORRA and Compounded AONIA” in the accompanying prospectus supplement.
•
Interest Periods:
During the
6-Year
Fixed Rate Period, each semi-annual period from, and including, an Interest
Payment Date (or, in the case of the first Interest Period, the Issue Date) to, but excluding, the next Interest Payment Date (or, if the
6-year
fixed/floating rate notes are redeemed earlier, the redemption
date).
During the
6-Year
Floating Rate
Period, each quarterly period from, and including, an Interest Period Demarcation Date (or in the case of the first Interest Period during the
6-Year
Floating Rate Period, the scheduled Interest Payment Date
of October 20, 2031 (adjusted, if applicable, as set forth under “Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA—General
Terms and Provisions Applicable to the Notes Using the Payment Delay Convention” in the accompanying prospectus supplement)) to, but excluding, the next Interest Period Demarcation Date (or, in the case of the final Interest Period, the
Maturity Date or, if the
6-year
fixed/floating rate notes are redeemed earlier, the redemption date).
•
Interest Period Demarcation Dates during the
6-Year
Floating Rate Period:
The 20
th
of each January, April, July and October, commencing January 20, 2032 and ending on the Maturity Date (or, if the
6-year
fixed/floating rate notes are redeemed earlier, ending on the redemption date).
•
Interest Payment Dates:
During the
6-Year
Fixed Rate Period, April 20 and October 20 of each year, beginning
April 20, 2027 and ending on October 20, 2031.
During the
6-Year
Floating Rate Period, the second Business Day following each Interest Period Demarcation Date; provided that the Interest Payment Date with respect to the final Interest Period will be the Maturity Date or,
if the
6-year
fixed/floating rate notes are redeemed earlier, the redemption date.
•
Rate
Cut-Off
Date:
The second U.S. government securities business day prior to the Maturity Date or redemption date, as applicable.
PS-8
Table of Contents
For purposes of calculating compounded SOFR with respect to the
final Interest Period, the level of SOFR for each U.S. government securities business day in the period from, and including, the Rate
Cut-Off
Date to, but excluding, the Maturity Date or redemption date, as
applicable, will be the level of SOFR in respect of such Rate
Cut-Off
Date.
•
Optional Redemption:
We may redeem the
6-year
fixed/floating rate notes at our option, (a) in whole, but not in
part, on October 20, 2031, or (b) in whole at any time or in part from time to time, on or after September 17, 2032 and prior to the Maturity Date, in each case, upon at least 5 business days’ but not more than 60 calendar
days’ prior written notice to holders of the
6-year
fixed/floating rate notes being redeemed at a redemption price equal to 100% of the principal amount of the
6-year
fixed/floating rate notes being redeemed, plus accrued and unpaid interest, if any, thereon to, but excluding, the redemption date.
In addition, we may redeem the
6-year
fixed/floating rate notes at our option, in whole at any time or in part from time to time, on or after April 20, 2027 (or, if additional
6-year
fixed/floating rate notes are issued after October 20,
2026, on or after the date that is six months after the issue date of such additional
6-year
fixed/floating rate notes), and prior to October 20, 2031 (which is the last day of the “remaining term”
of the
6-year
fixed/floating rate notes for purposes of such redemption), upon at least 5 business days’ but not more than 60 calendar days’ prior written notice to the holders of the
6-year
fixed/floating rate notes being redeemed, pursuant to a “make-whole redemption” at the applicable “make-whole” redemption price, in accordance with the applicable terms and provisions
set forth in the accompanying prospectus supplement under the heading “Description of the Notes—Redemption—Make-Whole Redemption.” The applicable “spread” to be added to the treasury rate for the
“make-whole” redemption price is 15 basis points.
Terms of the
11-Year
Fixed/Floating Rate Notes
•
Title of the Series:
6.062% Fixed/Floating Rate Senior Notes, due October 2037
•
Type of Notes:
Fixed/floating rate notes
•
Specified Currency:
U.S. dollars
•
Issue Price:
100%
PS-9
Table of Contents
•
Aggregate Principal Amount Initially Being Issued:
$2,750,000,000
•
Issue Date
:
October 20, 2026
•
CUSIP No.:
06051GNH8
•
ISIN:
US06051GNH82
•
Maturity Date:
October 20, 2037
•
Minimum Denominations:
$2,000 and multiples of $1,000 in excess of $2,000
•
Ranking:
Senior
•
Fixed Interest Rate:
6.062% per annum, payable semi-annually in arrears for each semi-annual Interest Period during the period from, and including, the Issue Date to, but excluding, October 20, 2036 (the
“
11-Year
Fixed Rate Period
”).
•
Floating Interest Rate:
Base Rate plus the Spread per annum, payable quarterly in arrears for each quarterly Interest Period during the period from, and including, October 20, 2036 to, but excluding, the Maturity Date (the “
11-Year
Floating Rate Period
”). During the
11-Year
Floating Rate Period, the
11-year
fixed/floating rate notes will be
“compounded SOFR notes” as such term is defined in the accompanying prospectus supplement.
•
Base Rate:
Compounded SOFR, which is a compounded average of daily SOFR (the Secured Overnight Financing Rate) as determined for each quarterly Interest Period during the
11-Year
Floating Rate Period
as set forth under “Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA—Determination of Compounded SOFR (Payment Delay)” in
the accompanying prospectus supplement.
•
Spread:
130 basis points
•
Payment Delay Convention:
Applicable. During the
11-Year
Floating Rate Period, accrued interest, Interest Periods, the interest rate and timing of interest payments for a particular Interest Period, among other
terms and provisions of the
11-year
fixed/floating rate notes, will be determined as set forth under “Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR,
Compounded SONIA, Compounded CORRA and Compounded AONIA” in the accompanying prospectus supplement.
•
Interest Periods:
During the
11-Year
Fixed Rate Period, each semi-annual period from, and including, an Interest
PS-10
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Payment Date (or, in the case of the first Interest Period, the Issue Date) to, but excluding, the next Interest Payment Date (or, if the
11-year
fixed/floating rate notes are redeemed earlier, the redemption date).
During the
11-Year
Floating Rate Period, each quarterly period from, and including, an Interest Period Demarcation Date
(or in the case of the first Interest Period during the
11-Year
Floating Rate Period, the scheduled Interest Payment Date of October 20, 2036 (adjusted, if applicable, as set forth under
“Description of the Notes—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA—General Terms and Provisions Applicable to the Notes Using the Payment Delay
Convention” in the accompanying prospectus supplement)) to, but excluding, the next Interest Period Demarcation Date (or, in the case of the final Interest Period, the Maturity Date or, if the
11-year
fixed/floating rate notes are redeemed earlier, the redemption date).
•
Interest Period Demarcation Dates during the
11-Year
Floating Rate Period:
The 20
th
of each January, April, July and October, commencing January 20, 2037 and ending on the Maturity Date (or, if the
11-year
fixed/floating rate notes are redeemed earlier, ending on the redemption date).
•
Interest Payment Dates:
During the
11-Year
Fixed Rate Period, April 20 and October 20 of each year, beginning
April 20, 2027 and ending on October 20, 2036.
During the
11-Year
Floating Rate Period, the second Business Day following each Interest Period Demarcation Date; provided that the Interest Payment Date with respect to the final Interest Period will be the Maturity Date or,
if the
11-year
fixed/floating rate notes are redeemed earlier, the redemption date.
•
Rate
Cut-Off
Date:
The second U.S. government securities business day prior to the Maturity Date or redemption date, as applicable.
For purposes of calculating compounded SOFR with respect to the final Interest Period,
the level of SOFR for each U.S. government securities business day in the period from, and including, the Rate
Cut-Off
Date to, but excluding, the Maturity Date or redemption date, as applicable, will be the
level of SOFR in respect of such Rate
Cut-Off
Date.
PS-11
Table of Contents
•
Optional Redemption:
We may redeem the
11-year
fixed/floating rate notes at our option, (a) in whole, but not in
part, on October 20, 2036, or (b) in whole at any time or in part from time to time, on or after July 20, 2037 and prior to the Maturity Date, in each case, upon at least 5 business days’ but not more than 60 calendar
days’ prior written notice to holders of the
11-year
fixed/floating rate notes being redeemed at a redemption price equal to 100% of the principal amount of the
11-year
fixed/floating rate notes being redeemed, plus accrued and unpaid interest, if any, thereon to, but excluding, the redemption date.
In addition, we may redeem the
11-year
fixed/floating rate notes at our option, in whole at any time or in part from time to time, on or after April 20, 2027 (or, if additional
11-year
fixed/floating rate notes are issued after
October 20, 2026, on or after the date that is six months after the issue date of such additional
11-year
fixed/floating rate notes), and prior to October 20, 2036 (which is the last day of the
“remaining term” of the
11-year
fixed/floating rate notes for purposes of such redemption), upon at least 5 business days’ but not more than 60 calendar days’ prior written notice to
the holders of the
11-year
fixed/floating rate notes being redeemed, pursuant to a “make-whole redemption” at the applicable “make-whole” redemption price, in accordance with the
applicable terms and provisions set forth in the accompanying prospectus supplement under the heading “Description of the Notes—Redemption— Make-Whole Redemption.” The applicable “spread” to be added to the
treasury rate for the “make-whole” redemption price is 15 basis points.
Terms Applicable to Each Series of the Fixed/Floating Rate Notes
•
Day Count Convention:
30/360 during the
3-Year
Fixed Rate Period, the
6-Year
Fixed Rate Period and the
11-Year
Fixed Rate Period;
Actual/360 during the
3-Year
Floating Rate Period, the
6-Year
Floating Rate Period and the
11-Year
Floating Rate
Period.
•
Business Days:
During the
3-Year
Fixed Rate Period, the
6-Year
Fixed Rate Period and the
11-Year
Fixed Rate Period, New
York/Charlotte; during the
3-Year
Floating Rate Period, the
6-Year
Floating Rate Period and the
11-Year
Floating Rate Period, New
York/Charlotte and U.S. government securities business day.
PS-12
Table of Contents
•
Business Day Convention:
During the
3-Year
Fixed Rate Period, the
6-Year
Fixed Rate Period and the
11-Year
Fixed Rate Period,
following unadjusted business day convention; during the
3-Year
Floating Rate Period, the
6-Year
Floating Rate Period and the
11-Year
Floating Rate Period, modified following business day convention (adjusted).
Terms Applicable to Each Series of the Notes
•
Record Dates for Interest Payments:
For book-entry only notes, the close of business on the date that is one business day prior to the applicable Interest Payment Date. If the notes are not held in book-entry only form, the record dates will be the fifteenth
calendar day preceding the applicable Interest Payment Date as originally scheduled to occur.
•
Repayment at Option of Holder:
None
•
Listing:
None
•
Calculation Agent:
For purposes of calculating the rate of interest on the floating rate notes and on the fixed/floating rate notes during the
3-Year
Floating Rate Period, the
6-Year
Floating Rate Period and the
11-Year
Floating Rate Period, we have entered into an agreement with The Bank of New York Mellon Trust Company, N.A. to act as
calculation agent. We may remove the calculation agent at any time, and we may appoint a replacement calculation agent, which may be an affiliate of ours, without your consent and without notifying you of the change.
•
Further Issuances:
We have the ability to “reopen,” or increase after the Issue Date, the aggregate principal amount of each series of the notes initially being issued without notice to the holders of existing notes of the relevant
series by selling additional notes of that series having the same terms, provided that such additional notes of such series will be fungible for U.S. federal income tax purposes. However, any new notes of this kind may have a different offering
price and may begin to bear interest on a different date.
PS-13
Table of Contents
SUPPLEMENTAL INFORMATION CONCERNING THE PLAN OF
DISTRIBUTION AND CONFLICTS OF INTEREST
On October 16, 2026, we entered into an agreement with the selling agents identified below for the purchase and sale of the notes (the
“
written terms agreement
”). We have agreed to sell to each of the selling agents, and each of the selling agents has agreed to purchase from us, the principal amount of the notes shown opposite its name in the table below at the
public offering price set forth above.
Selling Agent
Principal Amount
of Floating
Rate Notes
Principal Amount
of
3-Year
Fixed/Floating
Rate Notes
Principal Amount
of
6-Year
Fixed/Floating
Rate Notes
Principal Amount
of
11-Year
Fixed/Floating
Rate Notes
BofA Securities, Inc.
$
421,800,000
$
1,687,200,000
$
2,319,900,000
$
2,319,900,000
ANZ Securities, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
Apto Partners, LLC
2,300,000
9,200,000
12,650,000
12,650,000
Banco de Sabadell, S.A.
2,300,000
9,200,000
12,650,000
12,650,000
BMO Capital Markets Corp.
2,300,000
9,200,000
12,650,000
12,650,000
BNY Mellon Capital Markets, LLC
2,300,000
9,200,000
12,650,000
12,650,000
C.L. King & Associates, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
CastleOak Securities, L.P.
2,300,000
9,200,000
12,650,000
12,650,000
CIBC World Markets Corp.
2,300,000
9,200,000
12,650,000
12,650,000
Citizens JMP Securities, LLC
2,300,000
9,200,000
12,650,000
12,650,000
Commonwealth Bank of Australia
2,300,000
9,200,000
12,650,000
12,650,000
Fifth Third Securities, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
First Citizens Capital Securities, LLC
2,300,000
9,200,000
12,650,000
12,650,000
Goodbody Stockbrokers UC
2,300,000
9,200,000
12,650,000
12,650,000
Huntington Securities, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
KeyBanc Capital Markets Inc.
2,300,000
9,200,000
12,650,000
12,650,000
Lloyds Securities Inc.
2,300,000
9,200,000
12,650,000
12,650,000
M&T Securities, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
Mizuho Securities USA LLC
2,300,000
9,200,000
12,650,000
12,650,000
nabSecurities, LLC
2,300,000
9,200,000
12,650,000
12,650,000
Natixis Securities Americas LLC
2,300,000
9,200,000
12,650,000
12,650,000
Nomura Securities International, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
Nordea Bank Abp
2,300,000
9,200,000
12,650,000
12,650,000
PNC Capital Markets LLC
2,300,000
9,200,000
12,650,000
12,650,000
Rabo Securities USA, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
RB International Markets (USA) LLC
2,300,000
9,200,000
12,650,000
12,650,000
Samuel A. Ramirez & Company, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
Scotia Capital (USA) Inc.
2,300,000
9,200,000
12,650,000
12,650,000
Siebert Williams Shank & Co., LLC
2,300,000
9,200,000
12,650,000
12,650,000
SMBC Nikko Securities America, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
Standard Chartered Bank
2,300,000
9,200,000
12,650,000
12,650,000
TD Securities (USA) LLC
2,300,000
9,200,000
12,650,000
12,650,000
Truist Securities, Inc.
2,300,000
9,200,000
12,650,000
12,650,000
UniCredit Capital Markets LLC
2,300,000
9,200,000
12,650,000
12,650,000
Westpac Capital Markets LLC
2,300,000
9,200,000
12,650,000
12,650,000
Total
$
500,000,000
$
2,000,000,000
$
2,750,000,000
$
2,750,000,000
The obligations of the selling agents under the written terms agreement are several and not joint. The selling
agents have agreed to purchase all of the notes if any of them are purchased. In the event of a default by any selling agent, the written terms agreement provides that, in certain circumstances,
non-defaulting
selling agents may increase their purchase commitments, or the written terms agreement may be terminated.
The selling agents may sell the
notes to certain dealers at the public offering price, less a concession which will not exceed 0.120% of the principal amount of the floating rate notes, 0.120% of the principal amount of the
3-year
fixed/floating rate notes, 0.200% of the principal amount of the
6-year
fixed/floating rate notes and 0.250% of the principal amount of the
11-year
fixed/floating rate
notes, and the selling agents and those dealers
PS-14
Table of Contents
may resell the notes to other dealers at a reallowance discount which will not exceed 0.080% of the principal amount of the floating rate notes, 0.080% of the principal amount of the
3-year
fixed/floating rate notes, 0.150% of the principal amount of the
6-year
fixed/floating rate notes and 0.200% of the principal amount of the
11-year
fixed/floating rate notes.
After the initial offering of the notes, the concessions and
reallowance discounts for the notes may change.
We estimate that the total offering expenses for the notes, excluding the selling
agents’ commissions, will be approximately $1,750,000.
BofA Securities, Inc. is our wholly-owned subsidiary, and we will receive
the net proceeds of the offering.
We expect that delivery of the notes will be made to investors on or about October 20, 2026, which
is the second business day following the date of this pricing supplement (such settlement being referred to as “T+2”). Under Rule
15c6-1
of the Securities Exchange Act of 1934, as amended, trades
in the secondary market generally are required to settle in one business day, unless the parties to a trade expressly agree otherwise. Accordingly, purchasers who wish to trade notes at any time prior to the first business day preceding the issue
date will be required, by virtue of the fact that the notes initially settle in T+2, to specify an alternate settlement cycle at the time of the trade to prevent a failed settlement and should consult their own advisors in connection with that
election.
Some of the selling agents and their affiliates have engaged in, and may in the future engage in, investment banking, corporate
trust and other commercial dealings in the ordinary course of business with us or our affiliates. They have received, or may in the future receive, customary fees and commissions for these transactions.
In addition, in the ordinary course of their business activities, the selling agents and their affiliates may make or hold a broad array of
investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers. Such investments and securities activities
may involve securities and/or instruments of ours or our affiliates. The selling agents or their affiliates that have a lending relationship with us routinely hedge their credit exposure to us consistent with their customary risk management
policies. Typically, such selling agents and their affiliates would hedge such exposure by entering into transactions which consist of either the purchase of credit default swaps or the creation of short positions in our securities, including
potentially the notes offered hereby. Any such short positions could adversely affect future trading prices of the notes offered hereby. The selling agents and their affiliates may also make investment recommendations and/or publish or express
independent research views in respect of such securities or financial instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.
To the extent any selling agent that is not a U.S. registered broker-dealer intends to effect any offers or sales of any notes in the United
States, it will do so through one or more U.S. registered broker-dealers in accordance with the applicable U.S. securities laws and regulations.
PS-15
Table of Contents
VALIDITY OF THE NOTES
In the opinion of McGuireWoods LLP, as counsel to Bank of America Corporation (“BAC”), when the notes offered hereby have been
completed and executed by BAC, and authenticated by the trustee in accordance with the provisions of the indenture governing the notes, and the notes have been delivered against payment therefor as contemplated in this pricing supplement and the
related prospectus and prospectus supplement, all in accordance with the provisions of the indenture governing the notes, the notes will be the legal, valid and binding obligations of BAC, subject to the effects of applicable bankruptcy, insolvency
(including laws relating to preferences, fraudulent transfers and equitable subordination), reorganization, moratorium and other similar laws affecting creditors’ rights generally, and to general principles of equity. This opinion is given as
of the date of this pricing supplement and is limited to the laws of the State of New York and the Delaware General Corporation Law (including the statutory provisions, all applicable provisions of the Delaware Constitution and reported
judicial decisions interpreting the foregoing) as in effect on the date of this pricing supplement. In addition, this opinion is subject to customary assumptions about the trustee’s authorization, execution and delivery of the indenture
governing the notes, the validity, binding nature and enforceability of the indenture governing the notes with respect to the trustee, the legal capacity of individuals, the genuineness of signatures, the authenticity of all documents submitted to
McGuireWoods LLP as originals, the conformity to original documents of all documents submitted to McGuireWoods LLP as copies thereof, the authenticity of the originals of such copies and certain factual matters, all as stated in the letter of
McGuireWoods LLP dated March 5, 2024, which has been filed as an exhibit to BAC’s Registration Statement relating to the notes filed with the Securities and Exchange Commission on March 5, 2024.
PS-16
Table of Contents
Filed Pursuant to Rule 424(b)(3)
Registration No. 333-277673
Medium-Term Notes, Series N
We may offer from time to time our Bank of America Corporation Medium-Term Notes, Series N. The specific terms of any notes that we offer will be
determined before each sale and will be described in a separate pricing supplement and/or other prospectus supplement or supplements. Terms may include:
•
Priority: senior or subordinated
•
Interest rate:
¡
fixed-rate
¡
floating-rate
¡
fixed/floating rate
¡
fixed-rate reset
¡
non-interest
bearing
•
Maturity: 365 days (one year) or more
•
Currencies for denomination and/or payment: U.S. dollars, euro, Canadian dollars, Australian dollars, pounds sterling or any other currency that we specify in the applicable pricing supplement
•
Base rates for floating-rate notes:
¡
SOFR
¡
CORRA
¡
AONIA
¡
BBSW
¡
EURIBOR
¡
SONIA
¡
federal funds (effective) rate
¡
prime rate
¡
treasury (auction) rate
¡
any other rate we specify in the applicable pricing supplement
•
Reset reference rates for fixed-rate reset notes:
¡
U.S. Treasury Rate
¡
UK Government Bond (Gilt) Rate
We may sell the notes to selling agents as
principal for resale at varying or fixed offering prices or through the selling agents as agents using their best efforts on our behalf. We also may sell the notes directly to investors.
We may use this prospectus supplement and the accompanying prospectus in the initial sale of any notes. In addition, BofA Securities, Inc., or any of our other
broker-dealer affiliates, may use this prospectus supplement and the accompanying prospectus in market-making transactions in notes after their initial sale. Unless we or one of our selling agents informs you otherwise in the confirmation of sale,
this prospectus supplement and the accompanying prospectus are being used in a market-making transaction.
Unless otherwise specified in the applicable
supplement, the notes will not be listed or quoted on any securities exchange or quotation system.
Investing in the notes involves risks. See “
Risk
Factors Relating to the Notes
” beginning on
page S-9
and “
Risk Factors
” beginning on page 8 of the accompanying prospectus.
The notes are unsecured and are not savings accounts, deposits, or other obligations of a bank. The notes are not guaranteed by Bank of America, N.A. or any
other bank, and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency, and may involve investment risks.
None of the Securities and Exchange Commission, nor any state securities commission, nor any other regulatory body has approved or disapproved of the notes
or passed upon the adequacy or accuracy of this prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.
BofA Securities
Prospectus Supplement to Prospectus dated March 28, 2024
March 28, 2024
Table of Contents
TABLE OF CONTENTS
Page
Prospectus Supplement
About this Prospectus Supplement
S-3
Risk Factors Summary
S-7
Risk Factors Relating to the Notes
S-9
Description of the Notes
S-34
General
S-34
Ranking
S-35
Fixed-Rate Notes
S-36
Fixed/Floating Rate Notes
S-37
Floating-Rate Notes
S-37
Fixed-Rate Reset Notes
S-92
Specific Terms and Provisions of the Notes
S-101
Calculation Agents; Decisions and Determinations
S-102
Paying and Transfer Agents; Registrars
S-103
Payment of Principal, Interest, and Other Amounts Payable
S-104
Redemption
S-107
Repayment at Option of Holder
S-112
Reopenings
S-113
Extendible/Renewable Notes
S-113
Other Provisions
S-113
Repurchase
S-113
Form, Exchange, Registration, and Transfer of Notes
S-113
U.S. Federal Income Tax Considerations
S-116
Supplemental Plan of Distribution (Conflicts of Interest)
S-117
Selling Restrictions
S-120
Legal Matters
S-132
Index of Certain Defined Terms
S-133
Page
Prospectus
About this Prospectus
3
Prospectus Summary
4
Risk Factors
8
Risks Relating to Regulatory Resolution Strategies and Long-Term Debt Requirements
8
Risks Relating to Debt Securities Generally
9
Risks Relating to Our Common Stock and Preferred Stock
12
Other Risks
14
Bank of America Corporation
16
Use of Proceeds
16
Description of Debt Securities
17
General
17
Financial Consequences to Unsecured Debtholders of Single Point of Entry Resolution
Strategy
17
The Indentures
18
Form and Denomination of Debt Securities
19
Payment for
Non-U.S.
Dollar-Denominated
Debt Securities
19
Different Series of Debt Securities
20
Types of Debt Securities
21
Calculation Agents for Certain Types of Debt Securities
22
Original Issue Discount Notes
22
Payment of Principal, Interest, and Other Amounts Payable
22
No Sinking Fund
27
Redemption
27
Repayment
28
Repurchase
28
Conversion
28
Exchange, Registration, and Transfer
28
Subordination
29
Sale or Issuance of Capital Stock of Principal Subsidiary Bank
30
Limitation on Mergers and Sales of Assets
31
Waiver of Covenants
31
Modification of the Indentures
31
Meetings and Action by Securityholders
32
Events of Default and Rights of Acceleration; Covenant Breaches
32
Collection of Indebtedness and Suits for Enforcement by Trustee
33
Limitation on Suits
33
Payment of Additional Amounts
34
Redemption for Tax Reasons
37
Defeasance and Covenant Defeasance
38
Satisfaction and Discharge of the Indenture
39
Notices
39
Concerning the Trustee
39
Page
Governing Law
39
Description of Warrants
40
General
40
Description of Securities Warrants
40
Description of Index Warrants
41
Description of Currency Warrants
41
Modification
42
Enforceability of Rights of Warrantholders, No Trust Indenture Act Protection
42
Description of Purchase Contracts
43
General
43
Purchase Contract Property
43
Information in Supplement
43
Prepaid Purchase Contracts; Applicability of Indenture
44
Non-Prepaid
Purchase Contracts; No Trust
Indenture Act Protection
45
Pledge by Holders to Secure Performance
45
Settlement of Purchase Contracts that Are Part of Units
45
Failure of Holder to Perform Obligations
46
Description of Units
47
General
47
Unit Agreements: Prepaid,
Non-Prepaid,
and
Other
48
Modification
48
Enforceability of Rights of Unitholders; No Trust Indenture Act
Protection
48
Description of Preferred Stock
50
General
50
Dividends
51
Voting
51
Liquidation Preference
51
Preemptive Rights
51
Existing Preferred Stock
52
Additional Classes or Series of Stock
92
Description of Depositary Shares
93
General
93
Form of the Depositary Shares
93
Withdrawal of Preferred Stock
93
Dividends and Other Distributions
94
Redemption of Depositary Shares
94
Voting the Deposited Preferred Stock
94
Amendment and Termination of the Deposit Agreement
95
Charges of Depository
95
Miscellaneous
95
Resignation and Removal of Depository
95
Description of Common Stock
96
General
96
Voting and Other Rights
96
Dividends
96
Certain Anti-Takeover Matters
97
Registration and Settlement
98
Book-Entry Only Issuance
98
Definitive Securities
98
Street Name Owners
99
Legal Holders
99
Special Considerations for Indirect Owners
99
Depositories for Global Securities
100
Special Considerations for Global Securities
105
U.S. Federal Income Tax Considerations
108
Taxation of Debt Securities
109
Taxation of Common Stock, Preferred Stock, and Depositary
Shares
124
Taxation of Warrants
129
Taxation of Purchase Contracts
129
Taxation of Units
129
Reportable Transactions
130
Foreign Account Tax Compliance Act
130
Plan of Distribution (Conflicts of Interest)
132
Distribution Through Underwriters
132
Distribution Through Dealers
133
Distribution Through Agents
133
Direct Sales
133
General Information
133
Market-Making Transactions by Affiliates
134
Conflicts of Interest
134
ERISA Considerations
136
Where You Can Find More Information
138
Forward-Looking Statements
139
Legal Matters
140
Experts
140
S-2
Table of Contents
ABOUT THIS PROSPECTUS SUPPLEMENT
We have registered our Medium-Term Notes, Series N (the “notes”) on a registration statement on Form
S-3
filed with the Securities and Exchange Commission (the “SEC”), Registration
No. 333-277673.
From time to time, we intend to use this prospectus
supplement, the accompanying prospectus, and a related pricing supplement and/or other prospectus supplement or supplements to offer the notes. You should read each of these documents before investing in the notes.
This prospectus supplement describes additional terms of the notes and supplements the description of our debt securities that may be issued
under the Indentures (as defined below), including the notes, contained in the accompanying prospectus. If the information in this prospectus supplement is inconsistent with the accompanying prospectus, this prospectus supplement will supersede the
information in the accompanying prospectus.
For each offering of notes, we will issue a pricing supplement (and may issue other
prospectus supplement(s)) that will contain additional terms of the offering and specific terms and provisions of the notes being offered. Such pricing supplement also may add, update, or change information in this prospectus supplement or the
accompanying prospectus. In this prospectus supplement, references to the “applicable supplement” mean this prospectus supplement, and any applicable pricing supplement and/or other prospectus supplement or supplements filed with the SEC
pursuant to Rule 424 under the Securities Act, that describe the particular notes being offered to you. If there are any differences between the information contained in the applicable supplement or any document dated after the date of this
prospectus supplement and incorporated by reference into the accompanying prospectus, the information contained in such applicable supplement or document will supersede the information in this prospectus supplement. If the applicable supplement for
a series of notes includes terms and provisions that modify, conflict with or otherwise are inconsistent with the applicable terms and provisions of the notes set forth in this prospectus supplement, then, regardless of whether or not the applicable
terms and provisions set forth below are stated to apply “unless otherwise specified in the applicable supplement,” such terms and provisions set forth in the applicable supplement shall govern and control with respect to such
series of notes. We will state in the applicable supplement the interest rate for fixed-rate notes, the base rate for floating-rate notes or the reset reference rate for fixed-rate reset notes, as applicable, the applicable spread (if any), the
issue price, the maturity date, and the interest payment dates, redemption or repayment provisions, if any, and other relevant terms and provisions for each note at the time of issuance. An applicable supplement also may include a discussion of any
risk factors or other additional considerations that apply to a particular type of note or a particular series of notes. Each applicable supplement can be detailed and always should be read carefully.
IN CONNECTION WITH ANY OFFERING OF THE NOTES, WE MAY APPOINT A STABILIZING MANAGER, IN WHICH CASE THE STABILIZING MANAGER WILL BE IDENTIFIED
IN THE APPLICABLE SUPPLEMENT. THE STABILIZING MANAGER (OR PERSONS ACTING ON ITS BEHALF), IF ANY, MAY OVER ALLOT NOTES OR EFFECT TRANSACTIONS WITH A VIEW TO SUPPORTING THE MARKET PRICE OF THE APPLICABLE NOTES DURING THE STABILIZATION PERIOD AT A
LEVEL HIGHER THAN THAT WHICH MIGHT OTHERWISE PREVAIL. HOWEVER, STABILIZATION ACTION MAY NOT NECESSARILY OCCUR. ANY STABILIZATION ACTION MAY BEGIN ON OR AFTER THE DATE ON WHICH ADEQUATE PUBLIC DISCLOSURE OF THE TERMS OF THE OFFER OF THE APPLICABLE
SERIES OF NOTES IS MADE AND, IF BEGUN, MAY BE ENDED AT ANY TIME, BUT IT MUST END NO LATER THAN 30 DAYS AFTER THE DATE ON WHICH WE RECEIVE THE PROCEEDS OF THE APPLICABLE OFFERING OF NOTES, OR NO LATER THAN 60 DAYS AFTER THE DATE OF ALLOTMENT OF THE
APPLICABLE SERIES NOTES, WHICHEVER IS THE EARLIER. ANY STABILIZATION ACTION OR OVERALLOTMENT MUST
S-3
Table of Contents
BE CONDUCTED BY THE STABILIZING MANAGER (OR PERSONS ACTING ON ITS BEHALF) IN ACCORDANCE WITH ALL APPLICABLE LAWS AND RULES AND WILL BE UNDERTAKEN AT THE OFFICES OF THE STABILIZING MANAGER (OR
PERSONS ACTING ON ITS BEHALF) AND ON THE APPLICABLE STOCK EXCHANGE ON WHICH THE APPLICABLE SERIES OF NOTES IS LISTED, IF ANY.
This
prospectus supplement and the accompanying prospectus have been prepared on the basis that any offer of notes in any Member State of the European Economic Area (the “EEA”) (each, a “Relevant Member State”) will be made under
an exemption under Regulation (EU) No. 2017/1129 (as amended, the “EU Prospectus Regulation”), from the requirement to publish a prospectus for offers of notes. Accordingly, any person making or intending to make an offer in that
Relevant Member State of any notes which are contemplated in this prospectus supplement and the accompanying prospectus may only do so in circumstances in which no obligation arises for us or any of the selling agents to publish a prospectus
pursuant to Article 3 of the EU Prospectus Regulation or supplement a prospectus pursuant to Article 23 of the EU Prospectus Regulation, in each case, in relation to such offer. Neither we nor the selling agents have authorized, and neither we nor
they authorize, the making of any offer of notes in circumstances in which an obligation arises for us or any selling agent to publish or supplement a prospectus for the purposes of the EU Prospectus Regulation in relation to such offer. Neither
this prospectus supplement nor the accompanying prospectus constitutes an approved prospectus for the purposes of the EU Prospectus Regulation.
This prospectus supplement and the accompanying prospectus have been prepared on the basis that any offer of notes in the United Kingdom will
be made pursuant to an exemption under the UK Prospectus Regulation from the requirement to publish a prospectus for offers of notes. Accordingly, any person making or intending to make an offer in the United Kingdom of notes which are the subject
of this prospectus supplement and the accompanying prospectus may only do so in circumstances in which no obligation arises for us or any of the selling agents to publish a prospectus pursuant to section 85 of the Financial Services and Markets Act
2000 (as amended, the “FSMA”) or supplement a prospectus pursuant to Article 23 of the UK Prospectus Regulation, in each case, in relation to such offer. Neither we nor the selling agents have authorized, and neither we nor they
authorize, the making of any offer of notes in circumstances in which an obligation arises for us or any of the selling agents to publish or supplement a prospectus for the purposes of the UK Prospectus Regulation in relation to such offer. Neither
this prospectus supplement nor the accompanying prospectus constitutes an approved prospectus for the purposes of the UK Prospectus Regulation. The expression “UK Prospectus Regulation” means Regulation (EU) 2017/1129 as it forms part of
United Kingdom domestic law by virtue of the European Union (Withdrawal) Act of 2018 (the “EUWA”) and the regulations made under the EUWA.
This prospectus supplement and the accompanying prospectus are only for distribution to and directed at: (i) in the United Kingdom,
persons having professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the “Order”) and high net worth entities
falling within Article 49(2)(a) to (d) of the Order; (ii) persons who are outside the United Kingdom; and (iii) any other person to whom it can otherwise be lawfully distributed (all such persons together being referred to as
“Relevant Persons”). Any investment or investment activity to which this prospectus supplement and the accompanying prospectus relate is available only to and will be engaged in only with Relevant Persons, and any person who is not a
Relevant Person should not rely on them.
IMPORTANT – EEA RETAIL INVESTORS
– The notes are not intended to be offered,
sold or otherwise made available to and should not be offered, sold or otherwise made available to any
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retail investor in the EEA. For these purposes, a “retail investor” means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of
Directive 2014/65/EU (as amended, “MiFID II”); (ii) a customer within the meaning of Directive (EU) 2016/97 (as amended, the “Insurance Distribution Directive”), where that customer would not qualify as a professional client
as defined in point (10) of Article 4(1) of MiFID II; or (iii) not a qualified investor as defined in the EU Prospectus Regulation. Consequently no key information document required by Regulation (EU) No 1286/2014 (as amended, the
“EU PRIIPs Regulation”) for offering or selling the notes or otherwise making them available to retail investors in the EEA has been prepared and therefore offering or selling the notes or otherwise making them available to any retail
investor in the EEA may be unlawful under the EU PRIIPs Regulation.
IMPORTANT – UK RETAIL INVESTORS
— The notes are
not intended to be offered, sold or otherwise made available to and should not be offered, sold or otherwise made available to any retail investor in the United Kingdom (the “UK”). For these purposes, a “retail investor”
means a person who is one (or more) of: (i) a retail client as defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as it forms part of UK domestic law by virtue of the EUWA and the regulations made under the EUWA; (ii) a
customer within the meaning of the provisions of the FSMA and any rules or regulations made under the FSMA to implement Directive (EU) 2016/97, where that customer would not qualify as a professional client, as defined in point (8) of Article
2(1) of Regulation (EU) No 600/2014 as it forms part of UK domestic law by virtue of the EUWA and the regulations made under the EUWA; or (iii) not a qualified investor as defined in Article 2 of the UK Prospectus Regulation. Consequently, no
key information document required by Regulation (EU) No 1286/2014 as it forms part of UK domestic law by virtue of the EUWA and the regulations made under the EUWA (the “UK PRIIPs Regulation”) for offering or selling the notes or
otherwise making them available to retail investors in the UK, has been prepared and therefore offering or selling the notes or otherwise making them available to any retail investor in the UK may be unlawful under the UK PRIIPs Regulation.
Notification under Section
309B(1) of the Securities and Futures Act 2001 (the “SFA”)
- Unless otherwise
stated in the applicable supplement in respect of any notes, all notes issued or to be issued using this prospectus supplement and the accompanying prospectus are prescribed capital markets products (as defined in the Securities and Futures (Capital
Markets Products) Regulations 2018) and Excluded Investment Products (as defined in the Monetary Authority of Singapore (the “MAS”) Notice SFA
04-N12:
Notice on the Sale of Investment Products and
MAS Notice
FAA-N16:
Notice on Recommendations on Investment Products).
We are not licensed as a
bank or a credit institution in the United States or any other jurisdiction, and, under applicable U.S. laws, we are not required to be so licensed in order to issue any notes.
INVESTORS SHOULD NOTE THAT BANK OF AMERICA CORPORATION IS NOT LICENCED TO OPERATE AS A BANK IN ITALY.
*****************************************
Unless we indicate otherwise or unless the context requires otherwise, all references in this prospectus supplement to “Bank of
America,” “we,” “us,” “our,” or similar references are to Bank of America Corporation excluding its consolidated subsidiaries. In this prospectus supplement, references to “floating-rate notes”
mean both floating-rate notes and fixed/floating rate notes at any time such fixed/floating rate notes bear interest at a floating rate.
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Any term that is used, but not defined, in this prospectus supplement has the meaning set
forth in the accompanying prospectus. Certain terms that are used in this prospectus supplement have the specific meanings set forth herein. A listing of the pages on which such terms are defined can be found in the “Index of Certain Defined
Terms” beginning on page S-133 of this prospectus supplement. Capitalized or other defined terms used and defined in this prospectus supplement are sometimes defined after their first use without a reference such as “defined in this
prospectus supplement.”
When we refer to “you” or “investors” in this prospectus supplement, we mean those
who invest in the notes being offered by this prospectus supplement, whether they are the registered holders or only indirect owners of those notes. When we refer to “your notes” in this prospectus supplement, we mean the notes in
which you will hold a direct or indirect interest.
References in this prospectus supplement to “$,” “dollars” and
“U.S. dollars” are to the currency of the United States of America; references to “C$,” “Canadian dollars” and “CAD” are to the currency of Canada; references to “A$,” “Australian
dollars” and “AUD” are to the currency of the Commonwealth of Australia; references to “£,” “pounds sterling” and “GBP” are to the currency of the United Kingdom; and references to
“€,” “euro” and “EUR” are to the currency introduced at the start of the third stage of the European Economic and Monetary Union pursuant to Article 109g of the Treaty establishing the European Community, as
amended from time to time.
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RISK FACTOR SUMMARY
Your investment in the notes will involve certain risks. Set forth below is a summary of risks associated with an investment in the notes
that are discussed in more detail in this prospectus supplement under “Risk Factors Relating to the Notes” below.
Risks Relating to
the Secured Overnight Financing Rate and SOFR Notes Generally
•
Any failure of SOFR to maintain market acceptance could adversely affect the return on or value of the SOFR
notes and result in a limited secondary trading market for the SOFR notes.
•
SOFR may be modified or discontinued, which could adversely affect the return on, value of or market for
affected SOFR notes.
Risks Relating to the Sterling Overnight Index Average and Compounded SONIA Notes Generally
•
SONIA may be modified or discontinued, which could adversely affect the return on, value of or market for
affected compounded SONIA notes.
•
The market continues to develop in relation to SONIA as a base rate for floating-rate notes.
Risks Relating to the Canadian Overnight Repo Rate Average and Compounded CORRA Notes Generally
•
The composition and characteristics of CORRA are not the same as those of CDOR, and CORRA is not expected to be
a comparable substitute or replacement for CDOR.
•
The Applicable Fallback Rate for compounded CORRA notes may not be a suitable replacement for CORRA.
•
Any failure of CORRA to maintain market acceptance could adversely affect the return on or value of the
compounded CORRA notes and result in a limited secondary trading market for the compounded CORRA notes.
•
CORRA may be modified or discontinued, which could adversely affect the return on, value of or market for
affected compounded CORRA notes.
•
The market continues to develop in relation to CORRA as a base rate for floating-rate notes.
Risks Relating to the Australian Overnight Index Average Rate and Compounded AONIA Notes Generally
•
The composition and characteristics of AONIA are not the same as those of BBSW, and AONIA is not expected to be
a comparable substitute or replacement for BBSW.
•
The Applicable Fallback Rate for compounded AONIA notes may not be a suitable replacement for AONIA.
•
Any failure of AONIA to maintain market acceptance could adversely affect the return on or value of the
compounded AONIA notes and result in a limited secondary trading market for the compounded AONIA notes.
•
AONIA may be modified or discontinued, which could adversely affect the return on, value of or market for
affected compounded AONIA notes.
•
The market continues to develop in relation to AONIA as a base rate for floating-rate notes.
Risks Relating to Compounded SOFR Notes, Compounded SONIA Notes, Compounded CORRA Notes, Compounded AONIA Notes and Simple Average
SOFR Notes
•
The interest rate on a series of compounded notes or simple average SOFR notes will be based on a compounded or
simple average, respectively, of the applicable daily rate. Such compounded and simple average rates are relatively new in the marketplace.
•
Interest payments due on a series of compounded notes or simple average SOFR notes will be determined only at
the end of the relevant interest period.
•
With respect to a series of compounded notes using the payment delay convention, or simple average SOFR notes
that do not use a rate lookback, it will not be possible to calculate accrued interest with respect to any period until after the end of such period.
•
With respect to a series of compounded notes using the rate
cut-off
convention or payment delay convention, or a series of simple average SOFR notes that employs a rate
cut-off
date, pursuant to the formula used to determine compounded SOFR, compounded SONIA, compounded CORRA,
compounded AONIA or simple average SOFR, as applicable, for such notes for an applicable interest period, the applicable daily rate used in such calculation for any day from, and including, the rate
cut-off
date to, but excluding, the relevant interest payment date (or maturity or redemption date, if applicable) will be such daily rate in respect of the relevant rate
cut-off
date.
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•
Investors in a series of compounded notes using the payment delay convention will receive payments of interest
on a delayed basis.
Risks Relating to USD Benchmark Transition Provisions
•
The selection of a USD Benchmark Replacement could adversely affect the return on, value of or market for
affected SOFR notes.
Risks Relating to
Non-USD
Benchmark Transition Provisions
•
The selection of a
Non-USD
Benchmark Replacement could adversely affect
the return on, value of or market for affected notes.
Risks Relating to the Euro Interbank Offered Rate and EURIBOR Notes Generally
•
Regulation, reform and the actual or potential discontinuation of EURIBOR may adversely affect the return on,
value of and market for affected EURIBOR notes.
Risks Relating to the Bank Bill Swap Reference Rate and BBSW Notes Generally
•
Regulation, reform and the actual or potential discontinuation of BBSW may adversely affect the return on, value
of and market for affected BBSW notes.
•
If a Temporary Disruption Event occurs with respect to BBSW, BBSW will be determined in accordance with
alternative methods, and if a Permanent Discontinuation Trigger and related Permanent Fallback Effective Date occur with respect to BBSW, the Applicable Fallback Rate for BBSW may not be a suitable replacement for BBSW.
Risks Relating to the Floating-Rate Notes Generally
•
Floating-rate notes bear additional risks.
•
We or our affiliates may publish research reports that could affect the market value of the floating-rate notes.
•
The unavailability of certain base rates may result in the effective application of a fixed rate of interest for
the applicable floating-rate notes.
•
Historical rates are not an indication of future rates.
Risks Relating to Fixed-Rate Reset Notes with U.S. Treasury Rate as the Reset Reference Rate
•
The value of and return on any fixed-rate reset notes for which the reset reference rate is the U.S. Treasury
Rate may be adversely affected if the interest rate is determined using an alternative method or a replacement rate is used.
•
We or our designee (after consulting with us) may make determinations with respect to the U.S. Treasury Rate
that could affect the market value of your fixed-rate reset notes.
Risks Relating to Fixed-Rate Reset Notes with UK Government Bond
(Gilt) Rate as the Reset Reference Rate
•
The selection of a Gilt Benchmark Replacement could adversely affect the return on, value of or market for
affected notes.
Risks Relating to Fixed-Rate Reset Notes Generally
•
The interest rate on a series of fixed-rate reset notes will reset periodically and the subsequent interest rate
may be lower than the interest rate for prior interest periods.
•
Historical rates are not an indication of future rates.
Risks Relating to Notes Denominated in a Currency Other than the Investor’s Home Currency
•
An investment in a note denominated or payable in a currency other than your home currency involves
currency-related risks.
•
Changes in currency exchange rates can be volatile and may adversely affect an investment in a note denominated
or payable in a currency other than your home currency.
•
We will not adjust notes denominated or payable in a currency other than your home currency to compensate for
changes in foreign currency exchange rates.
•
Government policy can adversely affect foreign currency exchange rates and an investment in a note denominated
or payable in a currency other than your home currency.
•
Notes denominated or payable in currencies other than U.S. dollars permit us to make payments in U.S. dollars if
we are unable to obtain the specified currency.
•
An investor may bear currency exchange risk in a lawsuit for payment on a note denominated or payable in a
currency other than U.S. dollars.
•
Information about currency exchange rates may not be indicative of future performance.
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RISK FACTORS RELATING TO THE NOTES
Your investment in the notes involves significant risks. Your decision to purchase the notes should be made only after carefully
considering the risks of an investment in the notes, including those discussed below in this prospectus supplement relating to floating-rate notes, floating rates of interest, fixed-rate reset notes and fixed-rate reset rates of interest, and in the
applicable supplement for the specific notes, with your advisors in light of your particular circumstances. The notes are not an appropriate investment for you if you are not knowledgeable about significant elements of the notes or financial matters
in general. For information regarding risks and uncertainties that may materially affect our business and results, please refer to the information under the captions “Item 1A. Risk Factors” in our annual report on Form
10-K
for the year ended December 31, 2023, which is incorporated by reference in the accompanying prospectus, as well as those risks and uncertainties discussed in the accompanying prospectus and our subsequent
filings that are incorporated by reference in the accompanying prospectus. You also should review the risk factors that will be set forth in other documents that we will file after the date of this prospectus supplement.
This discussion of risks uses a number of capitalized and other defined terms that are defined elsewhere in this prospectus supplement. A
listing of the pages on which certain of such terms are defined can be found under the Index of Certain Defined Terms at the end of this prospectus supplement.
Risks Relating to the Secured Overnight Financing Rate and SOFR Notes Generally
The following discussion of risks relates to the Secured Overnight Financing Rate (
“
SOFR
”
) and SOFR
notes generally.
In this discussion, references to
“
SOFR notes
”
mean a series of compounded SOFR notes or simple average SOFR notes. You should carefully consider the following discussion of risks
before investing in SOFR notes.
Any failure of SOFR to maintain market acceptance could adversely affect the return on or value of
the SOFR notes and result in a limited secondary trading market for the SOFR notes.
According to the Federal Reserve Bank of New
York’s Alternative Reference Rates Committee (the “ARRC”), SOFR was developed for use in certain U.S. dollar derivatives and other financial contracts as an alternative to the London Interbank Offered Rate for deposits in U.S.
Dollars (“U.S. Dollar LIBOR”) in part because it is considered a good representation of general funding conditions in the overnight U.S. Treasury repurchase agreement market. However, as a rate based on transactions secured by U.S.
Treasury securities, it does not measure bank-specific credit risk and, as a result, is less likely to correlate with the unsecured short-term funding costs of banks. This may mean that market participants would not consider SOFR a suitable
substitute, replacement or successor for U.S. Dollar LIBOR, which may, in turn, lead to lessened market acceptance of SOFR.
To the
extent market acceptance for SOFR as a benchmark for floating-rate notes declines, the return on and value of the SOFR notes and the price at which investors can sell the SOFR notes in the secondary market could be adversely affected. In addition,
investors in the SOFR notes may not be able to sell the SOFR notes at all or may not be able to sell the SOFR notes at prices that will provide them with a yield comparable to similar investments that continue to have a developed secondary market,
and may consequently suffer from increased pricing volatility and market risk. Further, investors wishing to sell any securities linked to SOFR in the secondary market will have to make assumptions as to the future performance of SOFR during the
interest payment period in which they intend the sale to take place. As a result, investors may suffer from increased pricing volatility and market risk.
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As of the date of this prospectus supplement, there are multiple market conventions with
respect to the implementation of SOFR as a base rate for floating-rate notes or other securities. The manner of calculation and related conventions with respect to the determination of interest rates based on SOFR in floating-rate notes markets may
differ materially within floating-rate notes markets and compared with the manner of calculation and related conventions with respect to the determination of interest rates based on SOFR in other markets, such as the derivatives and loan markets.
Investors should carefully consider how any potential inconsistencies between the manner of calculation and related conventions with respect to the determination of interest or other payment rates based on SOFR across these markets may impact any
hedging or other financial arrangements that they may put in place in connection with any acquisition, holding or disposition of the SOFR notes.
SOFR may be modified or discontinued, which could adversely affect the return on, value of or market for affected SOFR notes.
The Federal Reserve Bank of New York (the “FRBNY”) (or a successor), as administrator of SOFR, may make methodological or other
changes that could change the value of SOFR, including changes related to the method by which SOFR is calculated, eligibility criteria applicable to the transactions used to calculate SOFR, or timing related to the publication of SOFR. The
administrator of SOFR may withdraw, modify, amend, suspend or discontinue the calculation or dissemination of SOFR in its sole discretion and without notice and has no obligation to consider the interests of investors in the SOFR notes in
calculating, withdrawing, modifying, amending, suspending or discontinuing SOFR. For purposes of the formula used to calculate interest with respect to a series of SOFR notes, SOFR in respect of a particular date will not be adjusted for any
modifications or amendments to SOFR data that the administrator of SOFR may publish after the interest rate on SOFR notes for that day has been determined in accordance with the terms and provisions set forth in this prospectus supplement and the
applicable supplement.
Risks Relating to the Sterling Overnight Index Average and Compounded SONIA Notes Generally
The following discussion of risks specifically relates to the Sterling Overnight Index Average rate (“SONIA”) and compounded
SONIA notes generally. You should carefully consider the following discussion of risks before investing in compounded SONIA notes.
SONIA may be modified or discontinued, which could adversely affect the return on, value of or market for affected compounded SONIA notes.
The Bank of England (the “BoE”) (or a successor), as administrator of SONIA, may make methodological or other changes
that could change the value of SONIA, including changes related to the method by which SONIA is calculated, eligibility criteria applicable to the transactions used to calculate SONIA, or timing related to the publication of SONIA (which may include
withdrawing, suspending or discontinuing the calculation or dissemination of SONIA). In addition, the BoE may make any or all of these changes in its sole discretion and without notice, and it has no obligation to consider the interests of investors
in any compounded SONIA notes in calculating, withdrawing, modifying, amending, suspending or discontinuing SONIA. We have no control over the methods of calculation, publication schedule, rate revision practices or availability of SONIA or the
SONIA Index at any time.
There can be no guarantee that SONIA will not be modified or discontinued in a manner that is materially adverse
to an investor in a series of compounded SONIA notes. If the manner in which SONIA is calculated is changed or if SONIA is discontinued, that change or discontinuance could reduce or otherwise negatively impact the amount of interest that accrues on
a series of compounded SONIA notes, which could adversely affect the return on, value of and market for such series of compounded SONIA notes.
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The market continues to develop in relation to SONIA as a base rate for floating-rate
notes.
The market continues to develop in relation to SONIA as a base rate as an alternative to the London Interbank Offered Rate for
pounds sterling. In particular, market participants and relevant working groups still are exploring alternative reference rates based on the risk free rates, including, for example, term SONIA reference rates which seek to measure the market’s
forward expectation of an average SONIA rate over a designated term.
The market or a significant part thereof may adopt an application of
SONIA that differs significantly from that set out and used in the terms and provisions relating to a particular series of compounded SONIA notes. If the market adopts a different calculation method, that would likely adversely affect the market
price of the applicable series of compounded SONIA notes.
In the future, we may also issue notes referencing SONIA that differ materially
in terms of interest determination when compared with any previous notes referencing SONIA. The development of SONIA as an interest base rate for the Eurobond markets, as well as continued development of the market infrastructure for adopting such
rates, could result in reduced liquidity or increased volatility or could otherwise affect the market price of any compounded SONIA notes.
The manner of adoption or application of SONIA in the Eurobond markets may differ materially compared with the application and adoption of
SONIA in other markets, such as the derivatives and loan markets. Investors should carefully consider how any mismatch between the adoption of SONIA in the bond, loan and derivatives markets may impact any hedging or other financial arrangement
which they may put in place in connection with any acquisition, holding or disposal of compounded SONIA notes.
Risks Relating to the Canadian
Overnight Repo Rate Average and Compounded CORRA Notes Generally
The following discussion of risks relates to the Canadian
Overnight Repo Rate Average (“CORRA”) and compounded CORRA notes generally. You should carefully consider the following discussion of risks before investing in compounded CORRA notes.
The composition and characteristics of CORRA are not the same as those of CDOR, and CORRA is not expected to be a comparable substitute or
replacement for CDOR.
In October 2020, the mandate of the Canadian Alternative Reference Rate working group (“CARR”) of
the Bank of Canada was expanded to contemplate a primary objective of supporting the adoption of, and transition to, CORRA as a key financial benchmark for Canadian derivatives and securities, and to analyze the current status of the Canadian Dollar
Offered Rate (“CDOR”). The composition and characteristics of CORRA are not the same as those of CDOR. CORRA measures the cost of overnight general collateral funding in Canadian dollars using Government of Canada treasury bills and
bonds as collateral for repurchase transactions. CORRA is not the economic equivalent of CDOR. While CORRA is a secured rate, CDOR is an unsecured rate. And, while CORRA is an overnight rate, CDOR is a committed bank lending rate or
“executable rate” at which contributing banks are obligated to lend funds to corporate borrowers with existing committed credit facilities referencing CDOR, and which is calculated using submitted rates from a panel of contributor banks.
As a result, there can be no assurance that CORRA will perform in the same way as CDOR would have at any time, including, without limitation, as a result of changes in interest and yield rates in the market, bank credit risk, market volatility or
global or regional economic, financial, political, regulatory, judicial or other events. For the same reasons, CORRA is not expected to be a comparable substitute or replacement for CDOR. For example, daily changes in
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CORRA have, on occasion, been more volatile than daily changes in other benchmark or market rates, such as CDOR, during corresponding periods. See also “—Any failure of CORRA to
maintain market acceptance could adversely affect the return on or value of the compounded CORRA notes and result in a limited secondary trading market for the compounded CORRA notes” below.
The Applicable Fallback Rate for compounded CORRA notes may not be a suitable replacement for CORRA.
The terms of the compounded CORRA notes provide for a waterfall of alternative rates to be used to determine the rate of interest on the
compounded CORRA notes if an Index Cessation Event and a related Index Cessation Effective Date occur with respect to CORRA. The first alternative rate to CORRA in the waterfall is the CAD Recommended Rate, which is the rate recommended as the
replacement for CORRA by a committee officially endorsed or convened by the Bank of Canada for the purpose of recommending a replacement for CORRA. If the CAD Recommended Rate is not available at the time of an Index Cessation Effective Date with
respect to CORRA, or if a CAD Recommended Rate is available at such time and an Index Cessation Effective Date subsequently occurs with respect to it, the next alternative rate in the waterfall is the BOC Target Rate, which is the Bank of
Canada’s target for the overnight rate as set by the Bank of Canada and published on the Bank of Canada’s website. Uncertainty with respect to market conventions related to the calculation of these CORRA fallback rates and whether either
alternative reference rate is a suitable replacement or successor for CORRA may adversely affect the return on, value of and market for the compounded CORRA notes.
There can be no assurance that the characteristics of any of the alternative rates for CORRA will be similar to those of CORRA, or that any
such alternative rate will produce the economic equivalent of the applicable CORRA rate as a reference rate for interest on an applicable series of compounded CORRA notes. Although the CORRA fallback provisions provide for us or our designee (after
consulting with us) to make certain term and spread adjustments to the Applicable Fallback Rate in order to attempt to make the resulting rate comparable to CORRA, such adjustments will not necessarily make the alternative rate equivalent to the
applicable CORRA rate.
In addition to the term and spread adjustments that we or our designee (after consulting with us) may make to an
Applicable Fallback Rate, the terms of the compounded CORRA notes expressly authorize us or our designee, after consulting with us, in connection with implementation of an Applicable Fallback Rate to make certain changes to the terms and provisions
of the applicable series of compounded CORRA notes with respect to, among other things, the determination of interest periods and the timing and frequency of determining rates and making payments of interest and other administrative matters. The
application of an Applicable Fallback Rate, including any term and/or spread adjustments that may be made to such rate by us or our designee (after consulting with us), and any implementation by us or our designee (after consulting with us) of any
other applicable changes to the terms and provisions of a series of compounded CORRA notes in connection with the implementation of an Applicable Fallback Rate, could result in adverse consequences to the interest rate or the amount of interest
payable on the notes, which could adversely affect the return on, value of and market for such notes and the price at which investors may be able to sell such notes.
Moreover, certain determinations, decisions and elections with respect to the Applicable Fallback Rate, any term or spread adjustments to the
Applicable Fallback Rate, and any other changes to the terms and provisions of an applicable series of compounded CORRA notes in connection with the implementation of an Applicable Fallback Rate, or the occurrence or nonoccurence of an Index
Cessation Event, may require the exercise of discretion and the making of subjective judgments by us or our designee (after consulting with us). Any determination, decision
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or election made by us or our designee pursuant to the fallback provisions with respect to CORRA set forth in this prospectus supplement will, if made by us, be made in our sole discretion and,
if made by our designee, be made after consultation with us and, in each case, will become effective without consent from the investors in the affected compounded CORRA notes or any other party. We may designate an entity to make any determination,
decision or election that we have the right to make in connection with the CORRA fallback provisions set forth in this prospectus supplement. Any designee that we may appoint in connection with these determinations, decisions or elections may be our
affiliate. When performing such functions, potential conflicts of interest may exist between us, our designee and investors in the compounded CORRA notes and making such potentially subjective determinations may adversely affect the return on, value
of and market for the compounded CORRA notes. All determinations by us or our designee in our or its discretion will be conclusive for all purposes and binding on us and investors in the applicable compounded CORRA notes absent manifest error.
Any failure of CORRA to maintain market acceptance could adversely affect the return on or value of the compounded CORRA notes and result
in a limited secondary trading market for the compounded CORRA notes.
As a rate based on transactions secured by Government of Canada
treasury bills and bonds, CORRA does not measure unsecured corporate credit risk and, as a result, is less likely to correlate with the unsecured short-term funding costs of corporations. This may mean that market participants would not consider
CORRA a suitable substitute or successor for CDOR, which may, in turn, lead to lessened market acceptance of CORRA.
To the extent market
acceptance for CORRA as a benchmark for floating-rate notes declines, the return on and value of the compounded CORRA notes and the price at which investors can sell the compounded CORRA notes in the secondary market could be adversely affected. In
addition, investors in the compounded CORRA notes may not be able to sell the compounded CORRA notes at all or may not be able to sell the compounded CORRA notes at prices that will provide them with a yield comparable to similar investments that
continue to have a developed secondary market, and may consequently suffer from increased pricing volatility and market risk.
The
methodology for calculating compounded CORRA for other compounded CORRA notes that we may issue may change, and we may in the future issue other compounded CORRA notes that differ materially in terms of interest determination when compared with any
previous compounded CORRA notes. The continued development of CORRA as a reference rate for the capital markets, as well as continued development of CORRA-based rates for such market and the market infrastructure for adopting such rates, could
result in reduced liquidity or increased volatility or could otherwise affect the market price of any compounded CORRA notes from time to time.
CORRA may be modified or discontinued, which could adversely affect the return on, value of or market for affected compounded CORRA notes.
The Bank of Canada, which has been the administrator of CORRA since June 2020 and which commenced publishing the CORRA compounded
index in April 2021, may make methodological or other changes that could change the value of CORRA or the CORRA compounded index, including changes related to the method by which CORRA or the CORRA compounded index are calculated, eligibility
criteria applicable to the transactions used to calculate CORRA, or timing related to the publication of CORRA or the CORRA compounded index. If the manner in which CORRA or the CORRA compounded index are calculated is changed, such change may
result in a reduction of the amount of interest payable on compounded CORRA notes, which may adversely affect the trading prices of compounded CORRA notes. The administrator of CORRA and the CORRA compounded
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index may withdraw, modify, amend, suspend or discontinue the calculation or dissemination of CORRA or the CORRA compounded index in its sole discretion and without notice and has no obligation
to consider the interests of investors in compounded CORRA notes in calculating, withdrawing, modifying, amending, suspending or discontinuing CORRA or the CORRA compounded index. For purposes of the formula used to calculate interest with respect
to a series of compounded CORRA notes, neither CORRA nor the CORRA compounded index, as applicable, in respect of a particular date will be adjusted for any modifications or amendments to CORRA or the CORRA compounded index data that the
administrator of CORRA or the CORRA compounded index may publish after the interest rate on compounded CORRA notes for that day has been determined in accordance with the terms and provisions set forth in this prospectus supplement and the
applicable supplement.
There can be no guarantee that either CORRA or the CORRA compounded index will not be modified or discontinued in
a manner that is materially adverse to an investor in compounded CORRA notes. If the manner in which CORRA or the CORRA compounded index is calculated is changed, or if CORRA or the CORRA compounded index are discontinued, such change or
discontinuance could reduce or otherwise negatively impact the amount of interest that accrues on a series of compounded CORRA notes, which could adversely affect the return on, value of and market for such series of compounded CORRA notes.
The market continues to develop in relation to CORRA as a base rate for floating-rate notes.
The market continues to develop in relation to CORRA as a base rate for floating-rate notes.
The market or a significant part thereof may adopt an application of CORRA that differs significantly from that set out and used in the terms
and provisions relating to the compounded CORRA notes. The use of the specific formula used to calculate compounded CORRA with respect to a series of notes may not be widely adopted by other market participants, if at all. If the market adopts a
different calculation method, that would likely adversely affect the market price of the applicable series of compounded CORRA notes.
In
the future, we may also issue notes referencing compounded CORRA that differ materially in terms of interest determination when compared with any previous notes referencing compounded CORRA. The development of compounded CORRA as a base rate for the
Canadian bond markets, as well as continued development of the market infrastructure for adopting such rates, could result in reduced liquidity or increased volatility or could otherwise affect the market price of any compounded CORRA notes.
The manner of adoption or application of CORRA in the Canadian bond market may differ materially compared with the application and adoption of
CORRA in other markets, such as the derivatives and loan markets. Investors should carefully consider how any mismatch between the adoption of CORRA in the bond, loan and derivatives markets may impact any hedging or other financial arrangement
which they may put in place in connection with any acquisition, holding or disposal of compounded CORRA notes.
Risks Relating to the Australian
Overnight Index Average Rate and Compounded AONIA Notes Generally
The following discussion of risks relates to the Australian
Overnight Index Average (“AONIA”) rate and compounded AONIA notes generally. You should carefully consider the following discussion of risks before investing in compounded AONIA notes.
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The composition and characteristics of AONIA are not the same as those of BBSW, and AONIA
is not expected to be a comparable substitute or replacement for BBSW.
The composition and characteristics of AONIA are not the same
as those of BBSW. While BBSW is a forward-looking term rate based on observed bid and offer rates for Australian prime bank eligible securities (which rates may incorporate a premium for credit risk), AONIA is an overnight, risk free cash rate and
is not the economic equivalent of BBSW. As a result, there can be no assurance that AONIA will perform in the same way as BBSW would have at any time, including, without limitation, as a result of changes in interest and yield rates in the market,
bank credit risk, market volatility or global or regional economic, financial, political, regulatory, judicial or other events. For the same reasons, AONIA is not expected to be a comparable substitute or replacement for BBSW. See also
“—Any failure of AONIA to maintain market acceptance could adversely affect the return on or value of the compounded AONIA notes and result in a limited secondary trading market for the compounded AONIA notes” below.
The Applicable Fallback Rate for compounded AONIA notes may not be a suitable replacement for AONIA.
The terms of the compounded AONIA notes provide for a waterfall of alternative rates to be used to determine the rate of interest on the
compounded AONIA notes if a Permanent Discontinuation Trigger and a related Permanent Fallback Effective Date occur with respect to AONIA. The first alternative rate to AONIA in the waterfall is the RBA Recommended Rate, which is the rate (inclusive
of any spreads or adjustments) recommended as the replacement for AONIA by the Reserve Bank of Australia. If the RBA Recommended Rate is not available at the time of a Permanent Discontinuation Trigger with respect to AONIA and related Permanent
Fallback Effective Date, or if an RBA Recommended Rate is available at such time and a Permanent Discontinuation Trigger and related Permanent Fallback Effective Date subsequently occur with respect to it, the next alternative rate in the waterfall
is the Final Fallback Rate, which is the rate determined by us or our designee (after consulting with us) as a commercially reasonable alternative for the Applicable Benchmark Rate taking into account all available information that, in good faith,
we or our designee (after consulting with us) considers relevant, together with (without double counting) such spread adjustment (which may be a positive or negative value or zero) that is customarily applied to the relevant successor rate or
alternative rate (as the case may be) in international debt capital markets transactions to produce an industry-accepted replacement rate for AONIA-linked floating rate notes at such time. Uncertainty with respect to market conventions related to
the calculation of these AONIA fallback rates and whether either alternative reference rate is a suitable replacement or successor for AONIA may adversely affect the return on, value of and market for the compounded AONIA notes.
There can be no assurance that the characteristics of any of the alternative rates for AONIA will be similar to those of AONIA, or that any
such alternative rate will produce the economic equivalent of the applicable AONIA rate as a reference rate for interest on an applicable series of compounded AONIA notes. Although the AONIA fallback provisions provide for us or our designee (after
consulting with us) to make certain term and spread adjustments to the Applicable Fallback Rate in order to attempt to make the resulting rate comparable to AONIA, such adjustments will not necessarily make the alternative rate equivalent to the
applicable AONIA rate.
In addition to the spread adjustments that we or our designee (after consulting with us) may make to an Applicable
Fallback Rate, the terms of the compounded AONIA notes expressly authorize us or our designee, after consulting with us, in connection with implementation of an Applicable Fallback Rate to make certain changes to the terms and provisions of the
applicable series of compounded AONIA notes with respect to, among other things, the determination of
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interest periods and the timing and frequency of determining rates and making payments of interest and other administrative matters. The application of an Applicable Benchmark Rate, including any
spread adjustment that may be made to such rate by us or our designee (after consulting with us), and any implementation by us or our designee (after consulting with us) of any other applicable changes to the terms and provisions of a series of
compounded AONIA notes in connection with the implementation of an Applicable Fallback Rate, could result in adverse consequences to the interest rate or the amount of interest payable on the notes, which could adversely affect the return on, value
of and market for such notes and the price at which investors may be able to sell such notes.
Moreover, certain determinations, decisions
and elections with respect to the Applicable Fallback Rate, any spread adjustments to the Applicable Fallback Rate, and any other changes to the terms and provisions of an applicable series of compounded AONIA notes in connection with the
implementation of an Applicable Fallback Rate, or the occurrence or nonoccurence of a Permanent Discontinuation Trigger, may require the exercise of discretion and the making of subjective judgments by us or our designee (after consulting with us).
Any determination, decision or election made by us or our designee pursuant to the fallback provisions with respect to AONIA set forth in this prospectus supplement will, if made by us, be made in our sole discretion and, if made by our designee, be
made after consultation with us and, in each case, will become effective without consent from the investors in the affected compounded AONIA notes or any other party. We may designate an entity to make any determination, decision or election that we
have the right to make in connection with the AONIA fallback provisions set forth in this prospectus supplement. Any designee that we may appoint in connection with these determinations, decisions or elections may be our affiliate. When performing
such functions, potential conflicts of interest may exist between us, our designee and investors in the compounded AONIA notes and making such potentially subjective determinations may adversely affect the return on, value of and market for the
compounded AONIA notes. All determinations by us or our designee in our or its discretion will be conclusive for all purposes and binding on us and investors in the applicable compounded AONIA notes absent manifest error.
Any failure of AONIA to maintain market acceptance could adversely affect the return on or value of the compounded AONIA notes and result
in a limited secondary trading market for the compounded AONIA notes.
As an overnight, risk free cash rate, AONIA does not measure
unsecured corporate credit risk and, as a result, is less likely to correlate with the unsecured short-term funding costs of corporations. This may mean that market participants would not consider AONIA a suitable substitute or successor for BBSW,
which may, in turn, lead to lessened market acceptance of AONIA.
To the extent market acceptance for AONIA as a benchmark for
floating-rate notes declines, the return on and value of the compounded AONIA notes and the price at which investors can sell the compounded AONIA notes in the secondary market could be adversely affected. In addition, investors in the compounded
AONIA notes may not be able to sell the compounded AONIA notes at all or may not be able to sell the compounded AONIA notes at prices that will provide them with a yield comparable to similar investments that continue to have a developed secondary
market, and may consequently suffer from increased pricing volatility and market risk.
The market or a significant part thereof may adopt
an application of AONIA that differs significantly from that used in relation to the compounded AONIA notes, which could result in reduced liquidity or otherwise affect the market price of the notes. Furthermore, the methodology for calculating
compounded AONIA for other compounded AONIA notes that we may issue may change, and we may in the future issue other compounded AONIA notes that differ materially in
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terms of interest determination when compared with any previous compounded AONIA notes. The continued development of AONIA as an interest reference rate for the capital markets, as well as
continued development of AONIA-based rates for such market and the market infrastructure for adopting such rates, could result in reduced liquidity or increased volatility or could otherwise affect the market price of any compounded AONIA notes from
time to time.
AONIA may be modified or discontinued, which could adversely affect the return on, value of or market for affected
compounded AONIA notes.
The Reserve Bank of Australia, as the administrator of AONIA, may make methodological or other changes that
could change the value of AONIA, including changes related to the method by which AONIA is calculated, eligibility criteria applicable to the transactions used to calculate AONIA, or timing related to the publication of AONIA. If the manner in which
AONIA is calculated is changed, such change may result in a reduction of the amount of interest payable on compounded AONIA notes, which may adversely affect the trading prices of compounded AONIA notes. The administrator of AONIA may withdraw,
modify, amend, suspend or discontinue the calculation or dissemination of AONIA in its sole discretion and without notice and has no obligation to consider the interests of investors in compounded AONIA notes in calculating, withdrawing, modifying,
amending, suspending or discontinuing AONIA. For purposes of the formula used to calculate interest with respect to a series of compounded AONIA notes, AONIA in respect of a particular date will be adjusted for any modifications or amendments to
AONIA data that the administrator of AONIA may publish after the interest rate on compounded AONIA notes for that day has been determined in accordance with the terms and provisions set forth in this prospectus supplement and the applicable
supplement.
There can be no guarantee that AONIA will not be modified or discontinued in a manner that is materially adverse to an
investor in compounded AONIA notes. If the manner in which AONIA is calculated is changed, or if AONIA is discontinued, such change or discontinuance could reduce or otherwise negatively impact the amount of interest that accrues on a series of
compounded AONIA notes, which could adversely affect the return on, value of and market for such series of compounded AONIA notes.
The
market continues to develop in relation to AONIA as a base rate for floating-rate notes.
The market continues to develop in relation
to AONIA as a base rate for floating-rate notes.
As of the date of this prospectus supplement, there are limited floating-rate notes in
the market using AONIA as a benchmark. Therefore, the return on and value of the compounded AONIA notes and the price at which investors can sell the compounded AONIA notes in the secondary market could be limited.
In the future, we may also issue notes referencing compounded AONIA that differ materially in terms of interest determination when compared
with any previous notes referencing compounded AONIA. The development of compounded AONIA as interest base rates for the Australian bond markets, as well as continued development of the market infrastructure for adopting such rates, could result in
reduced liquidity or increased volatility or could otherwise affect the market price of any compounded AONIA notes.
There currently is no
uniform market convention with respect to the implementation of risk free rates as a base rate for floating-rate notes or other securities. The manner of adoption or application of AONIA in the Australian bond market may differ materially compared
with the
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application and adoption of AONIA in other markets, such as the derivatives and loan markets. Investors should carefully consider how any mismatch between the adoption of AONIA in the bond, loan
and derivatives markets may impact any hedging or other financial arrangement which they may put in place in connection with any acquisition, holding or disposal of compounded AONIA notes.
Risks Relating to Compounded SOFR Notes, Compounded SONIA Notes, Compounded CORRA Notes, Compounded AONIA Notes and Simple Average SOFR Notes
The following discussion of risks specifically relates to compounded SOFR notes, compounded SONIA notes, compounded CORRA notes, compounded
AONIA notes and simple average SOFR notes (including, for the avoidance of doubt, compounded SOFR notes using the SOFR Index convention and compounded SONIA notes using the SONIA Compounded Index convention). In this discussion, references to
“compounded notes” mean a series of compounded SOFR notes, compounded SONIA notes, compounded CORRA notes or compounded AONIA notes, as applicable, references to “daily rate” mean SOFR, SONIA or CORRA, as applicable, and
references to “compounded index” mean the SOFR Index or the SONIA Compounded Index, as applicable. You should carefully consider the following discussion of risks before investing in compounded notes.
The interest rate on a series of compounded notes or simple average SOFR notes will be based on a compounded or simple average,
respectively, of the applicable daily rate. Such compounded and simple average rates are relatively new in the marketplace.
For each
interest period, the interest rate on a series of compounded notes or simple average SOFR notes will be based on a compounded or simple average, respectively, of the applicable daily rate calculated as described under “Description of the
Notes—Floating-Rate Notes,” in this prospectus supplement. For this and other reasons, the interest rate on a series of compounded notes or simple average SOFR notes during any interest period may not be the same as the interest rate on
other instruments bearing interest at a rate based on SOFR, SONIA or CORRA, as applicable, that use an alternative method to determine the applicable interest rate. Further, if a daily rate in respect of a particular date during an interest period
or observation period, if applicable, for a series of compounded notes or simple average SOFR notes is negative, the inclusion of such daily rate in the calculation of compounded notes or simple average SOFR notes for the applicable interest period
will reduce the interest rate and the interest payable on such series of compounded notes or simple average SOFR notes, as applicable, for such interest period.
The method for calculating an interest rate based upon compounded SOFR, compounded SONIA, compounded CORRA, compounded AONIA or simple average
SOFR (for example, payment delays, observation periods/lookbacks and/or lockout/suspension periods) in market precedents varies. This variation in the market could adversely affect the return on, value of and market for the compounded notes. In
addition, the specific formula for the compounded SOFR, compounded SONIA, compounded CORRA, compounded AONIA or simple average SOFR used in the notes may not continue to be utilized by other market participants. If the market transitions to a
different calculation method, that would likely adversely affect the market value of such notes.
Interest payments due on a series of
compounded notes or simple average SOFR notes will be determined only at the end of the relevant interest period.
Interest payments
due on a series of compounded notes or simple average SOFR notes will be determined only at the end of the relevant interest period. Therefore, investors in any series of compounded notes or simple average SOFR notes will not know the amount of
interest payable with respect to each interest period until shortly prior to the related interest payment date, and it may be difficult for investors in such compounded notes or simple average SOFR notes to estimate
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reliably the amounts of interest that will be payable on each such interest payment date at the beginning of or during the relevant interest period. In addition, some investors may be unwilling
or unable to trade such compounded notes or simple average SOFR notes without changes to their information technology systems, which could adversely impact the liquidity and trading price of any series of compounded notes or simple average SOFR
notes.
With respect to a series of compounded notes using the payment delay convention, or simple average SOFR notes that do not use a
rate lookback, it will not be possible to calculate accrued interest with respect to any period until after the end of such period.
With respect to a series of compounded notes using the payment delay convention, or simple average SOFR notes that do not use a rate lookback,
the applicable daily rate in respect of a given day is not published until the U.S. government securities business day, London banking day or Toronto banking day, as applicable, immediately following such day. As a result, it will not be possible to
calculate accrued interest with respect to any period for such notes until after the end of such period, which may adversely affect your ability to trade such notes in the secondary market.
With respect to a series of compounded notes using the rate
cut-off
convention or payment delay
convention, or a series of simple average SOFR notes that employs a rate
cut-off
date, pursuant to the formula used to determine compounded SOFR, compounded SONIA, compounded CORRA, compounded AONIA or simple
average SOFR, as applicable, for such notes for an applicable interest period, the applicable daily rate used in such calculation for any day from, and including, the rate
cut-off
date to, but excluding, the
relevant interest payment date (or maturity or redemption date, if applicable) will be such daily rate in respect of the relevant rate
cut-off
date.
The formula used to determine the base rate for compounded notes using the payment delay convention employs a rate
cut-off
date for the final interest period with respect to any series of notes. In addition, the formula used to determine the base rate for (i) any series of compounded notes for which the applicable
supplement specifies that the rate
cut-off
convention applies and (ii) any series of simple average SOFR notes for which the applicable supplement specifies that a rate
cut-off
date applies, may employ a rate
cut-off
date for each interest period with respect to such series.
For the final interest period with respect to a series of compounded notes using the payment delay convention, the applicable daily rate used
in the calculation of compounded SOFR, compounded SONIA, compounded CORRA or compounded AONIA, as applicable, for any day from, and including, the rate
cut-off
date to, but excluding, the maturity date or the
redemption date, if applicable, will be the applicable daily rate in respect of the rate
cut-off
date. The rate
cut-off
date will be (1) for compounded SOFR, two
U.S. government securities business days (or such other number of U.S. government securities business days as we may specify in the applicable supplement), (2) for compounded SONIA, five London banking days (or such other number of London banking
days as we may specify in the applicable supplement), (3) for compounded CORRA, two Toronto banking days (or such other number of Toronto banking days as we may specify in the applicable supplement), prior to the applicable maturity date (or
redemption date, if applicable) or (4) for compounded AONIA, two Sydney banking days (or such other number of Sydney banking days as we may specify in the applicable supplement), prior to the applicable maturity date (or redemption date, if
applicable).
For each interest period with respect to (i) any series of compounded SOFR notes using the rate
cut-off
convention and (ii) any series of simple average SOFR notes using a rate
cut-off
date, the applicable daily rate used in the calculation of compounded SOFR or
simple average SOFR, as
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applicable, for any day from, and including, the rate
cut-off
date to, but excluding, the relevant interest payment date or the maturity or redemption
date, if applicable, will be the applicable daily rate in respect of the rate
cut-off
date. The rate
cut-off
date will be (1) for compounded SOFR, five U.S.
government securities business days (or such other number of U.S. government securities business days as we may specify in the applicable supplement) or (2) for simple average SOFR, two U.S. government securities business days (or such other
number of U.S. government securities business days as we may specify in the applicable supplement), prior to each interest payment date or the maturity date (or redemption date, if applicable).
As a result of the foregoing, a holder of a series of compounded notes using the payment delay convention will not receive the benefit of any
increase in the level of SOFR, SONIA, CORRA or AONIA, as applicable, on any date subsequent to the applicable rate
cut-off
date in connection with the determination of the interest payable with respect to the
final interest period for such series of compounded notes using the payment delay convention. A holder of compounded SOFR notes using the rate
cut-off
convention or simple average SOFR notes using a
rate-cut
off date will not receive the benefit of any increase in the level of SOFR on any date subsequent to the applicable rate
cut-off
date in connection with the
determination of the interest payable with respect to each interest period for a series of compounded SOFR notes using the rate
cut-off
convention or simple average SOFR notes using a rate
cut-off
date, which could reduce the amount of interest that may be payable on the applicable series of notes.
Investors in a series of compounded notes using the payment delay convention will receive payments of interest on a delayed basis
.
The interest payment dates for any series of compounded notes using the payment delay convention with respect to interest rate
determination and interest payments will be two business days (or such other number of business days as we may specify in the applicable supplement) after the interest period demarcation date at the end of each interest period for such series. This
convention differs from the interest payment convention that has been used historically for floating-rate notes with interest rates based on other benchmark or market rates, where interest typically has been paid on a fixed day that immediately
follows the final day of the applicable interest period. As a result, investors in a series of compounded notes using the payment delay convention will receive payments of interest on a delayed basis as compared to traditional floating-rate notes
without payment delay in which they previously may have invested.
Risks Relating to USD Benchmark Transition Provisions
The following discussion of risks specifically relates to USD benchmark transition provisions. You should carefully consider the following
discussion of risks relating to USD benchmark transition provisions before investing in any SOFR notes. In this discussion, references to “SOFR notes” mean a series of compounded SOFR notes or simple average SOFR notes.
The selection of a USD Benchmark Replacement could adversely affect the return on, value of or market for affected SOFR notes.
If we or our designee, after consulting with us, determines that a USD Benchmark Transition Event and related USD Benchmark Replacement Date
have occurred with respect to a series of SOFR notes, the applicable USD Benchmark Replacement will replace the then-current USD Benchmark (which will be a rate based on SOFR at the original issue date of the relevant SOFR notes) for all purposes
relating to such SOFR notes. If a particular USD Benchmark Replacement or USD Benchmark Replacement Adjustment cannot be determined, then the next-available USD Benchmark Replacement or USD Benchmark Replacement Adjustment will apply. These
replacement rates and adjustments may be selected or formulated by (i) the USD Relevant
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Governmental Body (such as the ARRC), (ii) the International Swaps and Derivatives Association, Inc. (“ISDA”) or any successor thereto or (iii) in certain circumstances, us or
our designee (which may be our affiliate), after consulting with us.
In addition, the terms of the SOFR notes expressly authorize us or
our designee (which may be our affiliate), after consulting with us, in connection with a USD Benchmark Replacement to make USD Benchmark Replacement Conforming Changes with respect to, among other things, the determination of interest periods and
the timing and frequency of determining rates and making payments of interest and other administrative matters. The application of a USD Benchmark Replacement and USD Benchmark Replacement Adjustment, and any implementation of USD Benchmark
Replacement Conforming Changes, could result in adverse consequences to the interest rate or amount of interest payable on the SOFR notes, which could adversely affect the return on, value of and market for such SOFR notes and the price at which
investors may be able to sell such SOFR notes.
Moreover, certain determinations, decisions and elections with respect to the USD
Benchmark Replacement and any USD Benchmark Replacement Conforming Changes, or the occurrence or nonoccurence of a USD Benchmark Transition Event, may require the exercise of discretion and the making of subjective judgments by us or our designee
(after consulting with us). Any determination, decision or election made by us or our designee pursuant to the USD benchmark transition provisions set forth in this prospectus supplement will, if made by us, be made in our sole discretion and, if
made by our designee, be made after consultation with us and, in each case, will become effective without consent from the investors in the affected SOFR notes or any other party. We may designate an entity to make any determination, decision or
election that we have the right to make in connection with the USD benchmark transition provisions set forth in this prospectus supplement. Any designee that we may appoint in connection with these determinations, decisions or elections may be our
affiliate. When performing such functions, potential conflicts of interest may exist between us, our designee and investors in the SOFR notes and making such potentially subjective determinations may adversely affect the return on, value of and
market for the SOFR notes. All determinations by us or our designee in our or its discretion will be conclusive for all purposes and binding on us and investors in the applicable SOFR notes absent manifest error.
Further, (i) the composition and characteristics of any USD Benchmark Replacement for a series of SOFR notes will not be the same as
those of the applicable SOFR rate for a series of SOFR notes, the USD Benchmark Replacement will not be the economic equivalent of SOFR and there can be no assurance that the USD Benchmark Replacement will perform in the same way as SOFR would have
at any time and there is no guarantee that the USD Benchmark Replacement will be a comparable substitute for SOFR (each of which means that a USD Benchmark Transition Event could adversely affect the return on, value of and market for the applicable
series of SOFR notes), (ii) any failure of the USD Benchmark Replacement to gain market acceptance could adversely affect the relevant series of SOFR notes, (iii) the USD Benchmark Replacement may have a very limited history and the future
performance of the USD Benchmark Replacement may not be able to be predicted based on historical performance, (iv) the secondary trading market for debt securities linked to the USD Benchmark Replacement may be limited and (v) the
administrator of the USD Benchmark Replacement may make changes that could change the value of the USD Benchmark Replacement or discontinue the USD Benchmark Replacement and would not have any obligation to consider the interests of investors in the
relevant series of SOFR notes in doing so. For more information, see the USD benchmark transition provisions set forth under “Description of the Notes—Floating-Rate Notes—Effect of a USD Benchmark Transition Event and Related USD
Benchmark Replacement Date with Respect to SOFR” below.
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Risks Relating to
Non-USD
Benchmark Transition Provisions
The following discussion of risks specifically relates to the
Non-USD
benchmark transition
provisions. You should carefully consider the following discussion of risks before investing in EURIBOR notes (as defined below) or compounded SONIA notes.
In this discussion, references to “notes” mean a series of EURIBOR notes or compounded SONIA notes, as applicable.
The selection of a
Non-USD
Benchmark Replacement could adversely affect the return on, value of or
market for affected notes.
If we or our designee, after consulting with us, determines that a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark Replacement Date have occurred with respect to a series of notes, the applicable
Non-USD
Benchmark Replacement will replace the then-current
Non-USD
Benchmark for all purposes relating to such notes. If a particular
Non-USD
Benchmark Replacement or
Non-USD
Benchmark Replacement Adjustment cannot be determined, then the next-available
Non-USD
Benchmark Replacement or
Non-USD
Benchmark Replacement Adjustment will apply. These replacement rates and adjustments may be selected or formulated by the
Non-USD
Relevant Governmental Body or, in certain circumstances, us or our designee, after consulting with us.
In addition, the terms of the
notes expressly authorize us or our designee, after consulting with us, in connection with implementation of a
Non-USD
Benchmark Replacement to make
Non-USD
Benchmark
Replacement Conforming Changes with respect to, among other things, the determination of interest periods and the timing and frequency of determining rates and making payments of interest and other administrative matters. The application of a
Non-USD
Benchmark Replacement and
Non-USD
Benchmark Replacement Adjustment, and any implementation of
Non-USD
Benchmark Replacement
Conforming Changes, could result in adverse consequences to the interest rate or the amount of interest payable on the notes, which could adversely affect the return on, value of and market for such notes and the price at which investors may be able
to sell such notes.
Moreover, certain determinations, decisions and elections with respect to the
Non-USD
Benchmark Replacement and any
Non-USD
Benchmark Replacement Conforming Changes, or the occurrence or nonoccurence of a
Non-USD
Benchmark Transition Event, may require the exercise of discretion and the making of subjective judgments by us or our designee (after consulting with us). Any determination, decision or election made
by us or our designee pursuant to the
Non-USD
benchmark transition provisions set forth in this prospectus supplement will, if made by us, be made in our sole discretion and, if made by our designee, be made
after consultation with us and, in each case, will become effective without consent from the investors in the affected notes or any other party. We may designate an entity to make any determination, decision or election that we have the right to
make in connection with the
Non-USD
benchmark transition provisions set forth in this prospectus supplement. Any designee that we may appoint in connection with these determinations, decisions or elections may
be our affiliate. When performing such functions, potential conflicts of interest may exist between us, our designee and investors in the notes and making such potentially subjective determinations may adversely affect the return on, value of and
market for the notes. All determinations by us or our designee in our or its discretion will be conclusive for all purposes and binding on us and investors in the applicable notes absent manifest error.
Further, (i) the composition and characteristics of any
Non-USD
Benchmark Replacement in respect
of a series of notes will not be the same as those of EURIBOR or SONIA, as applicable, the
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Non-USD
Benchmark Replacement will not be the economic equivalent of EURIBOR or SONIA, as applicable, there can be no assurance that the
Non-USD
Benchmark Replacement will perform in the same way as EURIBOR or SONIA, as applicable, would have at any time and there is no guarantee that the
Non-USD
Benchmark
Replacement will be a comparable substitute for EURIBOR or SONIA, as applicable (each of which means that a
Non-USD
Benchmark Transition Event could adversely affect the return on, value of and market for the
applicable series of notes), (ii) any failure of the
Non-USD
Benchmark Replacement to gain market acceptance could adversely affect the relevant series of notes, (iii) the
Non-USD
Benchmark Replacement may have a very limited history and the future performance of the
Non-USD
Benchmark Replacement may not be able to be predicted based on
historical performance, (iv) the secondary trading market for debt securities linked to the
Non-USD
Benchmark Replacement may be limited and (v) the administrator of the
Non-USD
Benchmark Replacement may make changes that could change the value of the
Non-USD
Benchmark Replacement or discontinue the
Non-USD
Benchmark Replacement and would not have any obligation to consider the interests of investors in the relevant series of notes in doing so. For more information, see the
Non-USD
benchmark transition provisions set forth under “Description of the Notes—Floating-Rate Notes—Effect of a
Non-USD
Benchmark Transition Event
and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA” below.
Risks Relating
to the Euro Interbank Offered Rate and EURIBOR Notes Generally
The following discussion of risks specifically relates to the Euro
Interbank Offered Rate (
“
EURIBOR
”
) and EURIBOR notes generally.
You should carefully consider the following discussion of risks before investing in EURIBOR notes.
Regulation, reform and the actual or potential discontinuation of EURIBOR may adversely affect the return on, value of and market for
affected EURIBOR notes.
Previously, certain interest rates which are deemed to be “benchmark” rates have been the subject
of national, international and other regulatory guidance, reform and other actions. This has resulted in regulatory reform and changes to existing benchmarks. Such reform of benchmarks includes the Regulation (EU) 2016/1011 (as amended, the
“EU Benchmarks Regulation”) of the European Parliament and of the Council of 8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds and
amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No 596/2014, and the EU Benchmarks Regulation as it forms part of UK domestic law by virtue of the UK European Union (Withdrawal) Act 2018 (the “UK Benchmarks Regulation”
and, together with the EU Benchmarks Regulation, the “Benchmarks Regulations”), which apply to the provision of benchmarks, the contribution of input data to a benchmark and the use of a benchmark within the European Union (the
“EU”) and the United Kingdom (the “UK”), respectively.
Among other things, the Benchmarks Regulations
(i) require benchmark administrators to be authorized or registered (or, if
non-EU-based
or
non-UK
based, to be subject to
an equivalent regime or otherwise recognized or endorsed) and (ii) prevent certain uses by EU and UK supervised entities, as applicable, of benchmarks of administrators that are not authorized or registered (or if non
EU-based
or
UK-based,
as applicable, not deemed equivalent or recognized or endorsed).
The Benchmarks Regulations could have a material impact on EURIBOR notes, in particular, if the methodology or other terms of EURIBOR are
changed in order to comply with the requirements of the Benchmarks Regulations. Such changes could, among other things, have the effect of reducing, increasing or otherwise affecting the volatility of the published rate or level of EURIBOR.
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On September 21, 2017, the European Central Bank announced that it would be part of a
new working group tasked with the identification and adoption of a “risk free overnight rate” to serve as a basis for an alternative to benchmarks used in a variety of financial instruments and contracts used in the euro area. On
September 13, 2018, the working group on euro risk-free rates recommended the new euro short-term rate (“€STR”) as the new risk free rate for the euro area. €STR was published for the first time on October 2, 2019. In
addition, in response to regulatory scrutiny and applicable legal requirements, the European Money Markets Institute (the “EMMI”), as administrator of EURIBOR, conducted a series of consultations on a proposed reformed hybrid methodology
for EURIBOR. In July 2019, EMMI published its EURIBOR Benchmark Statement setting forth its reformed hybrid methodology and received regulatory authorization for the continued administration of EURIBOR. Although EURIBOR has been reformed in order to
comply with the terms of the EU Benchmarks Regulation, its future remains uncertain. It is not known how long EURIBOR will continue in its current form. Any of these developments could have a material adverse effect on the value and the return on
EURIBOR notes.
The euro risk-free rate working group for the euro area has published a set of guiding principles and high level
recommendations for the fallback provisions in, among other things, new euro denominated cash products (including floating-rate notes) referencing EURIBOR. The guiding principles indicate, among other things, that continuing to reference EURIBOR in
relevant contracts (without robust fallback provisions) may increase the risk to the euro area financial system. On May 11, 2021, the euro risk-free rate working group published its recommendations on EURIBOR fallback trigger events and
€STR-based
fallback rates. €STR has a different methodology and other important differences from EURIBOR and has little historical track record and may be subject to changes in its methodology.
In order to address the effect of any discontinuance of EURIBOR, EURIBOR notes include certain fallback provisions. With respect to any series
of EURIBOR notes, if we or our designee, after consulting with us, determines that a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark Replacement Date
have occurred with respect to EURIBOR, the applicable
Non-USD
Benchmark Replacement will replace EURIBOR for all purposes relating to such notes. See “Risks Relating to
Non-USD
Benchmark Transition Provisions” above. This may, among other things, result in the application of backward-looking €STR compounded in arrears, whereas EURIBOR is expressed on the basis of a
forward-looking term and includes a risk element based on interbank lending.
In the future, EURIBOR could be subject to further
regulatory scrutiny, reform efforts and/or other actions. Any such regulatory scrutiny, reform efforts and/or other actions could increase the costs and risks of administering or otherwise participating in the setting of EURIBOR and complying with
applicable regulations or requirements. Such factors may have the effect of discouraging market participants from continuing to administer or contribute to EURIBOR, trigger changes in the rules or methodologies used in EURIBOR or lead to the
elimination, discontinuance or obsolescence of EURIBOR. Following the implementation of reforms, the manner of administration of EURIBOR may change, with the result that EURIBOR may perform differently than in the past, or could be eliminated or
discontinued entirely, or there could be other consequences that cannot be predicted. Even prior to the implementation of any changes, uncertainty as to the nature of potential alternative reference rates and as to the nature and effect of potential
changes to EURIBOR may adversely affect EURIBOR during the term of a series of EURIBOR notes, as well as the value of, the return on and/or trading market for such series. Any of the foregoing consequences could have a material adverse effect on the
interest rate on, value of, return on and trading market for any EURIBOR notes.
Furthermore, if EURIBOR is discontinued or ceases to be
published, there can be no assurances that we and other market participants will be adequately prepared for such
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discontinuance or cessation, which may have an unpredictable impact on contractual mechanics (including, but not limited to, the interest rate with respect to particular series of EURIBOR notes),
among other adverse consequences.
Risks Relating to the Bank Bill Swap Reference Rate and BBSW Notes Generally
The following discussion of risks specifically relates to the Bank Bill Swap Reference Rate (“BBSW”) and BBSW notes generally.
You should carefully consider the following discussion of risks before investing in BBSW notes.
Regulation, reform and the actual
or potential discontinuation of BBSW may adversely affect the return on, value of and market for affected BBSW notes.
Interest rate
benchmarks, including BBSW, have been and continue to be the subject of regulatory guidance and proposals for reform in Australia and internationally. These reforms may cause such benchmarks to perform differently than in the past, to disappear
entirely, or have other consequences which cannot be predicted. Any such consequence as it relates to BBSW could have a material adverse effect on BBSW notes. In Australia, examples of reforms that are already effective include the replacement of
the Australian Financial Markets Association (“AFMA”) as BBSW administrator with the Australian Securities Exchange, changes to the methodology for calculation of BBSW, and amendments to the Corporations Act 2001 (Cth) made by the
Treasury Laws Amendment (2017 Measures No. 5) Act 2018 (Cth) which, among other things, enable the Australian Securities and Investment Commission (“ASIC”) to make rules relating to the generation and administration of financial
benchmarks. On June 6, 2018, ASIC designated BBSW as a “significant financial benchmark” and made the ASIC Financial Benchmark (Administration) Rules 2018 and the ASIC Financial Benchmarks (Compelled) Rules 2018.
Although many of the Australian reforms were designed to support the reliability and robustness of BBSW, it is not possible to predict with
certainty whether, and to what extent, BBSW will continue to be supported or the extent to which related regulations, rules, practices or methodologies may be amended going forward. This may cause BBSW to perform differently than it has in the past,
and may have other consequences which cannot be predicted. For example, it is possible that these changes could cause BBSW to cease to exist, to become commercially or practically unworkable, or to become more or less volatile or liquid. Any such
changes could have a material adverse effect on the BBSW notes.
If a Temporary Disruption Event occurs with respect to BBSW, BBSW will
be determined in accordance with alternative methods, and if a Permanent Discontinuation Trigger and related Permanent Fallback Effective Date occur with respect to BBSW, the Applicable Fallback Rate for BBSW may not be a suitable replacement for
BBSW.
On September 13, 2021, the Reserve Bank of Australia (“RBA”) announced its requirement that floating rate
notes issued after December 1, 2022 referencing BBSW must contain at least one “robust” and “reasonable and fair” fallback rate for BBSW if it permanently ceases to exist. The AFMA published the “AFMA Fallback
Language Template for Floating Rate Notes” on November 1, 2022 (the “AFMA Market Guidelines”) for voluntary use in contracts that reference BBSW to assist market participants to meet the requirements of the RBA’s updated
criteria. The fallback provisions relating to BBSW included herein under “Description of the Notes—Floating Rate Notes—Floating Rate Notes without Payment Delay—Determination of Base Rates—BBSW Notes—BBSW Fallback
Provisions” are based on the AFMA Market Guidelines (the “BBSW Fallback Provisions”). The BBSW Fallback Provisions distinguish between temporary and permanent triggers affecting BBSW. If a Temporary Disruption Trigger occurs in
respect of the
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BBSW, the interest rate for any day on which that Temporary Disruption Trigger is continuing will be the interest rate determined, in the first instance, with preference given to the
Administrator Recommended Rate (which is a rate formally recommended for use as the replacement for BBSW by the administrator of such rate). The second preference will be given to the Supervisor Recommended Rate (which is a rate formally recommended
for use as the replacement for BBSW by the supervisor of the administrator for BBSW). Finally, preference will be given to the Final Fallback Rate.
The terms of the BBSW notes provide for a waterfall of alternative rates to be used to determine the rate of interest on the BBSW notes if a
Permanent Discontinuation Trigger and a related Permanent Fallback Effective Date occur with respect to BBSW. The first alternative rate to BBSW in the waterfall is the AONIA Rate, which is equal to Compounded Daily AONIA plus the Adjustment Spread
(each as defined in the BBSW Fallback Provisions). Investors should be aware that, while BBSW is a forward-looking term rate based on observed bid and offer rates for Australian prime bank eligible securities (which rates may incorporate a premium
for credit risk), AONIA is an overnight, risk free cash rate and, if the AONIA Rate is the Applicable Fallback Rate, will be applied to calculate interest by compounding observed rates in arrear at or near the end of the applicable interest period
and adding the Adjustment Spread (which may be positive or negative or zero). The second alternative rate to BBSW in the waterfall is the RBA Recommended Fallback Rate, which is the rate (inclusive of any spreads or adjustments) recommended as the
replacement for AONIA by the Reserve Bank of Australia and is applicable when a permanent Fallback Effective Date occurs with respect to AONIA. If the RBA Recommended Rate is not available at the time of a Permanent Discontinuation Trigger with
respect to AONIA and related Permanent Fallback Effective Date, or if an RBA Recommended Rate is available at such time and a Permanent Discontinuation Trigger and related Permanent Fallback Effective Date subsequently occur with respect to it, the
next alternative rate in the waterfall is the Final Fallback Rate, which is the rate determined by us or our designee (after consulting with us) as a commercially reasonable alternative for the Applicable Benchmark Rate taking into account all
available information that, in good faith, we or our designee (after consulting with us) considers relevant, together with (without double counting) such spread adjustment (which may be a positive or negative value or zero) that is customarily
applied to the relevant successor rate or alternative rate (as the case may be) in international debt capital markets transactions to produce an industry-accepted replacement rate for AONIA-linked floating rate notes at such time. Uncertainty with
respect to market conventions related to the calculation of these BBSW fallback rates and whether any alternative reference rate is a suitable replacement or successor for BBSW may adversely affect the return on, value of and market for the BBSW
notes.
There can be no assurance that the characteristics of any of the alternative rates for AONIA will be similar to those of BBSW, or
that any such alternative rate will produce the economic equivalent of BBSW as a reference rate for interest on an applicable series of BBSW notes. Although the BBSW Fallback Provisions provide for us or our designee (after consulting with us) to
make certain term and spread adjustments to the Applicable Fallback Rate in order to produce an industry-accepted replacement rate for BBSW, such adjustments will not necessarily make the alternative rate equivalent to BBSW.
In addition to the spread adjustments that we or our designee (after consulting with us) may make to an Applicable Fallback Rate, the terms of
the BBSW notes expressly authorize us or our designee, after consulting with us, in connection with implementation of an Applicable Fallback Rate to make certain changes to the terms and provisions of the applicable series of BBSW notes with respect
to, among other things, the determination of interest periods and the timing and frequency of determining rates and making payments of interest and other administrative matters. The application of an Applicable Benchmark Rate, including any spread
adjustment that may be
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made to such rate by us or our designee (after consulting with us), and any implementation by us or our designee (after consulting with us) of any other applicable changes to the terms and
provisions of a series of BBSW notes in connection with the implementation of an Applicable Fallback Rate, could result in adverse consequences to the interest rate or the amount of interest payable on the notes, which could adversely affect the
return on, value of and market for such notes and the price at which investors may be able to sell such notes.
Moreover, certain
determinations, decisions and elections with respect to the Applicable Fallback Rate, any term or spread adjustments to the Applicable Fallback Rate, and any other changes to the terms and provisions of an applicable series of BBSW notes in
connection with the implementation of an Applicable Fallback Rate, or the occurrence or nonoccurence of a Permanent Discontinuation Trigger, may require the exercise of discretion and the making of subjective judgments by us or our designee (after
consulting with us). Any determination, decision or election made by us or our designee pursuant to the BBSW Fallback Provisions set forth in this prospectus supplement will, if made by us, be made in our sole discretion and, if made by our
designee, be made after consultation with us and, in each case, will become effective without consent from the investors in the affected BBSW notes or any other party. We may designate an entity to make any determination, decision or election that
we have the right to make in connection with the BBSW Fallback Provisions set forth in this prospectus supplement. Any designee that we may appoint in connection with these determinations, decisions or elections may be our affiliate. When performing
such functions, potential conflicts of interest may exist between us, our designee and investors in the BBSW notes and making such potentially subjective determinations may adversely affect the return on, value of and market for the BBSW notes. All
determinations by us or our designee in our or its discretion will be conclusive for all purposes and binding on us and investors in the applicable BBSW notes absent manifest error.
Investors should consult their own independent advisors and make their own assessment about the potential risks imposed by BBSW reforms and
the potential for BBSW to be discontinued in making any investment decision with respect to any BBSW notes.
Risks Relating to the Floating-Rate Notes
Generally
The following discussion of risks relates to the floating-rate notes generally. You should carefully consider the
following discussion of risks before investing in floating-rate notes.
Floating-rate notes bear additional risks.
For notes that bear interest at a floating-rate, there will be additional significant risks not associated with a conventional fixed-rate debt
security. These risks include fluctuation of the interest rates and the possibility that investors will receive an amount of interest that is lower than expected. We have no control over a number of matters, including economic, financial, and
political events, that are important in determining the existence, magnitude, and longevity of market volatility and other risks and their impact on the value of, or payments made on, floating-rate notes. Volatility of rates may adversely impact the
return on or market value of such floating-rate notes.
We or our affiliates may publish research reports that could affect the market
value of the floating-rate notes.
We or one or more of our affiliates, at present or in the future, may publish research reports with
respect to movements in interest rates generally or any base rate that may be used for the floating-rate notes. This research may be modified from time to time without notice and may express opinions or provide recommendations that are inconsistent
with purchasing or holding the notes. Any of these activities could affect the market value of the floating-rate notes.
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The unavailability of certain base rates may result in the effective application of a
fixed rate of interest for the applicable floating-rate notes.
In the event that any base rate described in this prospectus
supplement is unavailable on any date of determination, but the applicable provisions for a replacement rate (if any) have not been triggered, the last published level of the base rate or, the base rate for the previous interest period (depending on
the terms and conditions for the relevant base rate) will be used as the base rate for such date of determination. In addition, because the federal funds (effective) rate, prime rate and treasury (auction) rate do not have provisions for a
replacement rate, the use of the final fallback provision will result in the effective application of a fixed rate of interest for the applicable floating-rate notes. Furthermore, if AONIA, BBSW or EURIBOR is unavailable and the applicable
provisions for a replacement rate have been triggered, but a replacement rate cannot be determined under such provisions, then the last available rate will be used as the base rate under the final fallback provisions, which may result in the
effective application of a fixed rate of interest for the applicable floating-rate notes based on such last available rate.
Historical
rates are not an indication of future rates.
In the past, the certain base rates that may be used for the floating-rate notes have
experienced significant fluctuations. You should note that historical levels, fluctuations and trends of the base rates are not necessarily indicative of future levels. Any historical upward or downward trend in the applicable base rate is not an
indication that such base rate is more or less likely to increase or decrease at any time. Future levels of a base rate may bear little or no relation to the historical actual or historical indicative base rate data. Prior observed patterns, if any,
in the behavior of market variables and their relation to the base rate, such as correlations, may change in the future. In addition, to the extent that any
pre-publication
historical data is published with
respect to a base rate, production of such historical indicative data inherently involves assumptions, estimates and approximations. No future performance of any base rate may be inferred from any of the historical actual or historical indicative
base rate data.
Risks Relating to Fixed-Rate Reset Notes with U.S. Treasury Rate as the Reset Reference Rate
The following discussion of risks relates to the fixed-rate reset notes with the U.S. Treasury Rate as the reset reference rate. You should
carefully consider the following discussion of risks before investing in fixed-rate reset notes with the U.S. Treasury Rate as the reset reference rate.
The value of and return on any fixed-rate reset notes for which the reset reference rate is the U.S. Treasury Rate may be adversely
affected if the interest rate is determined using an alternative method or a replacement rate is used.
Under the circumstances
described herein under “Description of the Notes—Fixed-Rate Reset Notes—Determination of Reset Reference Rates—U.S. Treasury Rate,” the interest rate for a series of fixed-rate reset notes for which the reset reference
rate is the U.S. Treasury Rate will be determined using an alternative method to determine the applicable U.S. Treasury Rate or, if a rate substitution event has occurred with respect to the applicable U.S. Treasury Rate, using a replacement rate.
If the interest rate on such a series of notes is determined by using such an alternative method or replacement rate, such alternative method or replacement rate may result in an interest rate and interest payments that are lower than or that do not
otherwise correlate over time with the interest rate and interest payments that would have been made on such notes if the reset reference rate had been determined using the first method for determining the applicable U.S. Treasury Rate specified
under “Description of the Notes—Fixed-Rate Reset Notes—Determination of Reset Reference Rates—U.S. Treasury Rate.” If a rate substitution event has occurred and it is determined there is no industry-accepted successor
rate to the applicable
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U.S. Treasury Rate (or then-applicable replacement rate), the interest rate for the applicable reset period will be: (a) if the first reset interest rate is to be determined, the initial
interest rate or (b) if a subsequent reset interest rate is to be determined, the interest rate that was applicable for the preceding reset period.
We or our designee (after consulting with us) may make determinations with respect to the U.S. Treasury Rate that could affect the market
value of your fixed-rate reset notes.
If we or our designee, after consulting with us, determines that the applicable U.S. Treasury
Rate cannot be determined in the manner set forth under “Description of the Notes—Fixed-Rate Reset Notes—Determination of Reset Reference Rates—U.S. Treasury Rate,” the terms of the applicable fixed-rate reset notes
expressly authorize us or our designee, after consulting with us, to determine whether there is an industry-accepted successor rate to the applicable U.S. Treasury Rate and, if applicable, to determine and make certain adjustments with respect to
such industry-accepted successor rate and the use thereof as the rate used to determine the interest rate on such fixed-rate reset notes. If we or our designee, after consulting with us, determines that there is no such industry-accepted successor
rate, then the interest rate for the applicable reset period will be (a) if the first reset interest rate is to be determined, the initial interest rate or (b) if a subsequent reset interest rate is to be determined, the interest rate that
was applicable for the preceding reset period, and such rate could remain in effect for so long as such fixed-rate reset notes are outstanding.
Certain of these determinations, and other related determinations described in this prospectus supplement, may require the exercise of
discretion and the making of subjective judgments by us or our designee, after consulting with us. In making these potentially subjective determinations, we or our designee may have economic interests that are adverse to interests of investors in
fixed-rate reset notes, and such determinations may adversely affect the return on, value of and market for the fixed-rate reset notes.
Risks Relating
to Fixed-Rate Reset Notes with UK Government Bond (Gilt) Rate as the Reset Reference Rate
The following discussion of risks
relates to the fixed-rate reset notes with the UK Government Bond (Gilt) Rate as the reset reference rate. You should carefully consider the following discussion of risks before investing in fixed-rate reset notes with the UK Government Bond (Gilt)
Rate as the reset reference rate.
The selection of a Gilt Benchmark Replacement could adversely affect the return on, value of or
market for affected notes.
If we or our designee, after consulting with us, determines that a Gilt Benchmark Transition Event and
related Gilt Benchmark Replacement Date have occurred with respect to a series of fixed-rate reset notes for which the reset reference rate is specified in the applicable supplement to be the UK Government Bond (Gilt) Rate, the applicable Gilt
Benchmark Replacement will replace the then-current Gilt Benchmark for all purposes relating to such notes. If a particular Gilt Benchmark Replacement or Gilt Benchmark Replacement Adjustment cannot be determined, then the next-available Gilt
Benchmark Replacement or Gilt Benchmark Replacement Adjustment will apply. These replacement rates and adjustments may be selected or formulated by the Gilt Relevant Governmental Body or, in certain circumstances, us or our designee, after
consulting with us.
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In addition, the terms of fixed-rate reset notes for which the reset reference rate is
specified in the applicable supplement to be the UK Government Bond (Gilt) Rate expressly authorize us or our designee, after consulting with us, in connection with implementation of a Gilt Benchmark Replacement to make Gilt Benchmark Replacement
Conforming Changes with respect to, among other things, the determination of interest periods and the timing and frequency of determining rates and making payments of interest and other administrative matters. The application of a Gilt Benchmark
Replacement and Gilt Benchmark Replacement Adjustment, and any implementation of Gilt Benchmark Replacement Conforming Changes, could result in adverse consequences to the amount of interest payable on such notes, which could adversely affect the
interest rate, the return on, value of and market for such notes and the price at which investors may be able to sell such notes.
Moreover, certain determinations, decisions and elections with respect to the Gilt Benchmark Replacement and any Gilt Benchmark Replacement
Conforming Changes, or the occurrence or nonoccurence of a Gilt Benchmark Transition Event, may require the exercise of discretion and the making of subjective judgments by us or our designee, after consulting with us. Any determination, decision or
election made by us or our designee pursuant to the Gilt benchmark transition provisions set forth in this prospectus supplement under the heading “Description of the Notes—Fixed-Rate Reset Notes—Effect of a Gilt Transition Event
and Related Gilt Replacement Date” will, if made by us, be made in our sole discretion and, if made by our designee, be made after consultation with us and, in each case, will become effective without consent from the investors in the affected
notes or any other party. We may designate an entity to make any determination, decision or election that we have the right to make in connection with the Gilt benchmark transition provisions set forth in this prospectus supplement. Any designee
that we may appoint in connection with these determinations, decisions or elections may be our affiliate. When performing such functions, potential conflicts of interest may exist between us or our designee and investors in the affected notes. All
determinations by us or our designee in our or its discretion will be conclusive for all purposes and binding on us and investors in the applicable notes absent manifest error. In making these potentially subjective determinations, we, or our
designee may have economic interests that are adverse to your interests, and such determinations may adversely affect the return on, value of and market for the applicable notes.
Further, (i) the composition and characteristics of any Gilt Benchmark Replacement in respect of a series of affected notes will not be
the same as those of the applicable UK Government Bond (Gilt) Rate, as applicable, the Gilt Benchmark Replacement will not be the economic equivalent of the applicable UK Government Bond (Gilt) Rate, there can be no assurance that the Gilt Benchmark
Replacement will perform in the same way as the applicable UK Government Bond (Gilt) Rate would have at any time and there is no guarantee that the Gilt Benchmark Replacement will be a comparable substitute for the applicable UK Government Bond
(Gilt) Rate (each of which means that a Gilt Benchmark Transition Event could adversely affect the return on, value of and market for the applicable series of notes), (ii) any failure of the Gilt Benchmark Replacement to gain market acceptance could
adversely affect the relevant series of notes, (iii) the Gilt Benchmark Replacement may have a very limited history and the future performance of the Gilt Benchmark Replacement may not be able to be predicted based on historical performance,
(iv) the secondary trading market for debt securities linked to the Gilt Benchmark Replacement may be limited and (v) the administrator of the Gilt Benchmark Replacement, if applicable, may make changes that could change the value of the
Gilt Benchmark Replacement or discontinue the Gilt Benchmark Replacement and would not have any obligation to consider the interests of investors in the relevant series of notes in doing so. For more information, see the Gilt benchmark transition
provisions set forth under “Description of the Notes—Fixed-Rate Reset Notes—Effect of a Gilt Transition Event and Related Gilt Replacement Date” below in this prospectus supplement.
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Risks Relating to Fixed-Rate Reset Notes Generally
The following discussion of risks relates to the fixed-rate reset notes generally. You should carefully consider the following discussion
of risks before investing in fixed-rate reset notes.
The interest rate on a series of fixed-rate reset notes will reset
periodically and the subsequent interest rate may be lower than the interest rate for prior interest periods.
The interest on a
series of fixed-rate reset notes will reset periodically and the interest or rate for each interest period will equal the reset reference rate specified in the applicable supplement plus a spread, as applicable. Therefore, after the interest rate
resets, the interest rate could be less than the fixed rate for the initial interest period and any subsequent interest rate, if applicable, may be less than a prior rate. We have no control over the factors that may affect interest rates, including
geopolitical conditions and economic, financial, political, regulatory, judicial or other events that may affect the market generally and interest rates specifically.
Historical rates are not an indication of future rates.
In the past, certain reset reference rates that may be used for the fixed-rate reset notes have experienced significant fluctuations. You
should note that historical levels, fluctuations and trends of the reset reference rates are not necessarily indicative of future levels. Any historical upward or downward trend in the applicable reset reference rate is not an indication that such
reset reference rate is more or less likely to increase or decrease at any time, and you should not take the historical reset reference rate levels as an indication of future levels.
Risks Relating to Notes Denominated in a Currency Other than the Investor’s Home Currency
We may issue notes denominated in, or with respect to which principal, interest
and/or
other amounts payable are payable in,
a currency other than the currency of the country in which you reside or the currency in which you conduct your business or activities (the “home currency”). If you intend to invest in notes denominated or payable in a currency other
than your home currency, you should consult your own financial and legal advisors as to the currency risks related to your investment. Such notes are not an appropriate investment for you if you are not knowledgeable about the significant terms and
conditions of such notes, foreign currency transactions or financial matters in general.
An investment in a note denominated or
payable in a currency other than your home currency involves currency-related risks.
An investment in a note denominated or payable
in a currency other than your home currency entails significant risks that are not associated with a similar investment in a note that is payable solely in your home currency. These risks include possible significant changes in rates of exchange
between your home currency and the applicable specified currency of the notes, and the imposition or modification of foreign exchange controls or other conditions by applicable governmental entities. These risks generally depend on factors over
which we have no control, such as economic and political events and the supply of and demand for the relevant currencies in the global markets.
Changes in currency exchange rates can be volatile and may adversely affect an investment in a note denominated or payable in a currency
other than your home currency.
In recent years, exchange rates between certain foreign currencies have been highly volatile. This
volatility may continue and could spread to other currencies in the future. Fluctuations in
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currency exchange rates could affect adversely an investment in a note denominated or payable in a currency other than your home currency, and such changes in exchange rates may vary considerably
during the life of that note. Depreciation of the applicable specified currency for a series of notes against your home currency could result in a decrease in your home currency equivalent value of payments on such notes, including the principal or
other amounts payable at maturity or the redemption amount payable upon those notes. That in turn could cause the market value such notes to fall.
We will not adjust notes denominated or payable in a currency other than your home currency to compensate for changes in foreign currency
exchange rates.
Except as described below or in the applicable supplement, we will not make any adjustment in or change to the terms
of notes denominated or payable in currencies other than your home currency for changes in the foreign currency exchange rate for the relevant specified currency for a series of notes, including any devaluation, revaluation, or imposition of
exchange or other regulatory controls or taxes, or for other developments affecting that currency or any other currency. Consequently, you will bear the risk that your investment may be affected adversely by these types of events.
Government policy can adversely affect foreign currency exchange rates and an investment in a note denominated or payable in a currency
other than your home currency.
Foreign currency exchange rates either can float or be fixed by sovereign governments. Governments or
governmental bodies, including the European Central Bank, may intervene from time to time in their economies to alter the exchange rate or exchange characteristics of their currencies. For example, a central bank may intervene to devalue or revalue
a currency or to replace an existing currency. In addition, a government may impose regulatory controls or taxes to affect the exchange rate of its currency or may issue a new currency or replace an existing currency. As a result, the amounts
payable on and rate of return of a note denominated or payable in a currency other than your home currency could be affected significantly and unpredictably by governmental actions. Even in the absence of governmental action directly affecting
currency exchange rates, political or economic developments in the country or region issuing the specified currency for an applicable series of notes or elsewhere could result in significant and sudden changes in the exchange rate between your home
currency and specified currency. Changes in exchange rates could affect the value of notes denominated or payable in a currency other than your home currency as participants in the global currency markets move to buy or sell the specified currency
or your home currency in reaction to these developments.
If a governmental authority imposes exchange controls or other conditions, such
as taxes on the exchange or transfer of the specified currency, there may be limited availability of the specified currency for payment on notes denominated or payable in a currency other than your home currency at their maturity or on any other
payment date. In addition, the ability of a holder to move currency freely out of the country in which payment in the currency is received or to convert the currency at a freely determined market rate could be limited by governmental actions.
Notes denominated or payable in currencies other than U.S. dollars permit us to make payments in U.S. dollars if we are unable to obtain
the specified currency.
The terms of any series of notes denominated or payable in a currency other than U.S. dollars provide that we
have the right to make a payment in U.S. dollars instead of the specified currency, if at or about the time when the payment on such notes comes due, the specified currency is subject to convertibility, transferability, market disruption, or other
conditions affecting its availability
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because of circumstances beyond our control. These circumstances could include the imposition of exchange controls, our inability to obtain the specified currency because of a disruption in the
currency markets for the specified currency, or unavailability because the specified currency is no longer used by the government of the relevant country or for settlement of transactions by public institutions of or within the international banking
community. In addition, if the specified currency for a note has been replaced by a new currency, we will have the option to choose whether we make payments on such note in the replacement currency or in U.S. dollars. In either case, the exchange
rate used to make payment in U.S. dollars or the replacement currency, if any, may be based on limited information and would involve significant discretion on the part of the exchange rate agent, which may be one of our affiliates, to be appointed
by us. As a result, the value of the payment in our home currency may be less than the value of the payment you would have received in the specified currency if the specified currency had been available. The exchange rate agent generally will not
have any liability for its determinations.
See “Description of Debt Securities—Payment of Principal, Interest, and Other
Amounts Payable—Payments Due in Other Currencies—Unavailability of Currencies and Replacement Currencies” in the accompanying prospectus. Any payment in respect of the notes so made in U.S. dollars where the required payment is in
an unavailable specified currency will not constitute an event of default under the relevant indenture or the notes. If your home currency is not U.S. dollars, any such payment will expose you to the significant risks described above in this section
“—Risks Relating to Notes Denominated in a Currency Other Than an Investor’s Home Currency.”
An investor may
bear currency exchange risk in a lawsuit for payment on a note denominated or payable in a currency other than U.S. dollars.
Any
notes issued under the Senior Indenture or the Subordinated Indenture will be governed by New York law. Under Section 27 of the New York Judiciary Law, a state court in the State of New York rendering a judgment on notes denominated or payable
in a currency other than U.S. dollars and governed by New York law would be required to render the judgment in such
non-U.S.
currency. In turn, the judgment would be converted into U.S. dollars at the exchange
rate prevailing on the date of entry of the judgment. Consequently, in a lawsuit for payment on notes denominated or payable in a
non-U.S.
currency and governed by New York law, you would bear currency
exchange risk until judgment is entered, which could be a long time.
In courts outside of New York, you may not be able to obtain
judgment in a specified currency other than U.S. dollars. For example, a judgment for money in an action based on notes denominated or payable in a
non-U.S.
currency in many other U.S. federal or state courts
ordinarily would be enforced in the United States only in U.S. dollars. The date and method used to determine the rate of conversion of the specified currency into U.S. dollars will depend on various factors, including which court renders the
judgment.
Information about currency exchange rates may not be indicative of future performance.
If we issue a note denominated or payable in a currency other than your home currency, we may include in the applicable supplement information
about historical exchange rates for the relevant currency or currencies. Any information about exchange rates that we may provide will be furnished as a matter of information only, and you should not regard the information as indicative of the range
of, or trends in, fluctuations in currency exchange rates that may occur in the future.
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DESCRIPTION OF THE NOTES
This section describes general terms and provisions of the notes, which may be senior or subordinated medium-term notes. This section
supplements, and should be read together with, the general description of our debt securities, and the terms and provisions thereof, included in “Description of Debt Securities” in the accompanying prospectus. If there is any
inconsistency between the information in this prospectus supplement and the accompanying prospectus, the information in this prospectus supplement will supersede the information in the accompanying prospectus.
The terms and provisions of the notes set forth in this prospectus supplement will apply to a series of notes, to the extent applicable as
set forth below, unless otherwise specified in the applicable supplement. If the applicable supplement for a series of notes includes terms and provisions that modify, conflict with or otherwise are inconsistent with the applicable terms and
provisions set forth below, then, regardless of whether the applicable terms and provisions set forth below are stated to apply “unless otherwise specified in the applicable supplement,” such terms and provisions set forth in the
applicable supplement shall govern and control with respect to such series of notes.
Certain capitalized or other defined terms
that are used in this section “Description of the Notes” have the specific meanings set forth herein. A listing of the pages on which certain of such terms are defined can be found under the “Index of Certain Defined Terms”
beginning on page S-133 of this prospectus supplement.
General
We will issue the notes as part of a series of debt securities under the Senior Indenture or the Subordinated Indenture, as applicable, which
are contracts between us, as issuer, and The Bank of New York Mellon Trust Company, N.A., as trustee. In this prospectus supplement, we refer to The Bank of New York Mellon Trust Company, N.A. and any successor trustee under the Senior
Indenture or the Subordinated Indenture, as applicable, as the “trustee,” and we refer to the Senior Indenture and the Subordinated Indenture, each as may be supplemented from time to time, individually as an “Indenture” and
together as the “Indentures.” In addition to the following summary of general terms of the notes and the Indentures, you should review the forms of the global note certificates and the specific provisions of the Senior Indenture and the
Subordinated Indenture, as applicable, which we have filed with the SEC.
The Indentures are subject to, and governed by, the Trust
Indenture Act of 1939.
Our senior debt securities, which we refer to in this prospectus supplement as our “senior notes,”
will be issued under the Senior Indenture and will rank equally in right of payment with our other unsecured and unsubordinated obligations. Our subordinated debt securities, which we refer to in this prospectus supplement as our “subordinated
notes,” will be issued under the Subordinated Indenture and will be subordinate and junior in right of payment to all of our senior indebtedness from time to time outstanding as provided in the Subordinated Indenture.
We and the selling agents, in the ordinary course of our respective businesses, have conducted and may conduct business with the trustee or
its affiliates. See “Description of Debt Securities—The Indentures” in the accompanying prospectus for more information about the Indentures and the functions of the trustee.
The notes are our direct unsecured obligations and are not obligations of our subsidiaries. The Indentures do not limit the amount of
indebtedness that we may incur. We may issue other debt securities under the Indentures from time to time in one or more series up to the aggregate principal amount of the then-existing grant of authority by our board of directors.
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Unless otherwise provided in the applicable supplement, the minimum denomination of the
notes will be $1,000 and integral multiples of $1,000 in excess of $1,000 (or the equivalent in other currencies).
We may issue the
following types of notes: fixed-rate notes, floating-rate notes, fixed/floating rate notes and fixed-rate reset notes. For more information on these types of notes, see below under “—Fixed-Rate Notes,” “—Floating-Rate
Notes,” “—Fixed/Floating Rate Notes” and “—Fixed-Rate Reset Notes.” In addition, we may issue notes that do not bear interest.
Ranking
Because we are a holding company, our right to participate in any distribution of assets of any subsidiary upon such subsidiary’s
liquidation or reorganization or otherwise is subject to the prior claims of creditors of that subsidiary, except to the extent we may ourselves be recognized as a creditor of that subsidiary. Accordingly, our obligations under senior notes or
subordinated notes will be structurally subordinated to all existing and future liabilities of our subsidiaries, and claimants should look only to our assets for payments on the notes. Further, creditors of our subsidiaries recapitalized pursuant to
our resolution plan generally would be entitled to payments of their claims from the assets of the subsidiaries, including our contributed assets. In addition, any of our obligations under the senior notes and the subordinated notes will be
unsecured and therefore in a bankruptcy or similar proceeding will effectively rank junior to our secured obligations to the extent of the value of the assets securing such obligations. See “Risk Factors—Risks Relating to Regulatory
Resolution Strategies and Long-Term Debt Requirements,” “Risk Factors—Risks Relating to Debt Securities Generally” and “Description of Debt Securities—Financial Consequences to the Unsecured Debtholders of Single
Point of Enty Resolution Strategy” in the accompanying prospectus.
Senior Notes
The senior notes will be unsecured and will rank equally in right of payment with all our other unsecured and unsubordinated obligations from
time to time outstanding, except obligations that are subject to any priorities or preferences by law.
The Senior Indenture and the
senior notes do not contain any limitation on the amount of obligations that we may incur in the future.
Subordinated Notes
Our indebtedness evidenced by the subordinated notes, including the principal and any premium, interest, and other amounts
payable, will be unsecured and will be subordinate and junior in right of payment to all of our senior indebtedness from time to time outstanding to the extent and in the manner provided in the Subordinated Indenture. The subordinated notes will
rank equally in right of payment with all our other unsecured and subordinated indebtedness, other than unsecured and subordinated indebtedness that by its terms is subordinated to the subordinated notes. Due to differing subordination provisions in
various series of subordinated debt securities issued by us and our predecessors, in the event of a dissolution, winding up, liquidation, reorganization, insolvency, receivership or other proceeding, investors in subordinated notes may receive more
or less, ratably, than investors in some other series of our outstanding subordinated debt securities. Payment of principal of our subordinated indebtedness, including any subordinated notes, may not be accelerated if there is a default in the
payment of amounts payable under, or a default in any of our other covenants applicable to, our subordinated indebtedness.
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The Subordinated Indenture and the subordinated notes do not contain any limitation on the
amount of obligations ranking senior to the subordinated notes, or the amount of obligations ranking equally with the subordinated notes, that we may incur in the future.
Unless we specify otherwise in the applicable supplement, the subordinated notes will not be guaranteed by us or any of our affiliates and
will not be subject to any other arrangement that legally or economically enhances the ranking of the subordinated notes. For more information about our subordinated notes, see “Description of Debt Securities—Subordination” in the
accompanying prospectus.
Fixed-Rate Notes
We may issue notes that bear interest at a fixed rate as set forth in the applicable supplement, which we refer to as “fixed-rate
notes.” Unless we specify otherwise in the applicable supplement, each fixed-rate note will bear interest from its original issue date or from the most recent date to which interest on the note has been paid or made available for payment.
Interest will accrue on the principal of a fixed-rate note at the fixed annual rate stated in the applicable supplement, until the principal is paid or made available for payment.
Unless we specify otherwise in the applicable supplement, we will pay interest on any fixed-rate note quarterly, semiannually, or annually, as
applicable, in arrears, on the days set forth in the applicable supplement (each such day being an “interest payment date” for a fixed-rate note) and at the maturity date or earlier redemption date, as applicable. Unless we specify
otherwise in the applicable supplement, each interest payment due on an interest payment date, the maturity date or earlier redemption date, as the case may be, will include interest accrued from, and including, the most recent interest payment date
to which interest has been paid, or, if no interest has been paid, from the original issue date, to, but excluding, the next interest payment date, the maturity date or earlier redemption date, as the case may be (each such period, an
“interest period”). The amount of accrued interest on a fixed-rate note for an interest period is calculated by multiplying the principal amount of such note by an accrued interest factor. This accrued interest factor will be determined
by multiplying the per annum fixed interest rate by a factor resulting from the day count convention that applies with respect to such determination. Unless we specify otherwise in the applicable supplement, the factor resulting from the day count
convention will be (a) with respect to fixed-rate notes denominated in U.S. dollars, computed on the basis of a
360-day
year consisting of twelve
30-day
months,
which we may refer to as the “30/360” day count convention, (b) with respect to fixed-rate notes denominated in Australian dollars, computed and paid on the basis of the actual number of days in the relevant period divided by 365,
or if any portion of the relevant period falls in a leap year, the sum of (i) the actual number of days in that portion of the relevant period falling in a leap year divided by 366 and (ii) the actual number of days in that portion of the
relevant period falling in a
non-leap
year divided by 365, which we may refer to as the “Actual/Actual” day count convention, (c) with respect to fixed-rate notes denominated in pounds
sterling or euro, computed on the basis of an Actual/Actual (ICMA) (as defined in the rulebook of the International Capital Markets Association) day count convention, which we may refer to as the “Actual/Actual (ICMA)” day count
convention and (d) with respect to fixed-rate notes denominated in Canadian dollars, computed on the basis of (i) the 30/360 day count convention when calculating interest for a full semi-annual interest period and (ii) the actual
number of days in the relevant period divided by 365, when calculating interest for any period that is shorter than a full semi-annual interest period, which we may refer to together as the “Actual/Actual (Canadian Compound Method)” day
count convention. We will make payments on fixed-rate notes as described below under “—Payment of Principal, Interest, and Other Amounts Payable” and in the accompanying prospectus under the heading “Description of Debt
Securities—Payment of Principal, Interest, and Other Amounts Payable.”
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We also may issue amortizing notes, which are fixed-rate notes for which combined principal
and interest payments are made in installments over the life of the note. Unless we specify otherwise in the applicable supplement, payments on amortizing notes are applied first to interest due and then to the reduction of the unpaid principal
amount, and the applicable supplement for an amortizing note will include a table setting forth repayment information.
Fixed/Floating Rate Notes
We may issue notes with elements of each of the fixed-rate notes described above and floating-rate notes described below. For example, a note
may bear interest at a fixed rate for some interest periods and at a floating rate for other interest periods. We will describe the determination of interest for any of these notes in the applicable supplement.
Floating-Rate Notes
We may issue notes that will bear interest at a floating interest rate determined in accordance with the applicable terms and provisions set
forth in this section and the applicable supplement. We refer to these notes as “floating-rate notes.” The terms and provisions of floating-rate notes set forth in this prospectus supplement will apply, to the extent applicable as set
forth below, unless otherwise specified in the applicable supplement.
Overview of Base Rates and Floating-Rate Note Provisions
The interest rate for each series of floating-rate notes will be determined by reference to a “base rate” specified
in the applicable supplement. The “base rate” for a floating-rate note will, if so specified in the applicable supplement, be one or more of the following, or may be any other base rate as may be specified in the applicable supplement:
•
the Australian dollar Bank Bill Swap Reference Rate, in which case the note will be a “BBSW note”;
•
the euro interbank offered rate, in which case the note will be a “EURIBOR note”;
•
the federal funds (effective) rate, in which case the note will be a “federal funds (effective) rate
note”;
•
the prime rate, in which case the note will be a “prime rate note”;
•
the treasury (auction) rate, in which case the note will be a “treasury (auction) rate note”;
•
compounded SOFR, calculated by reference to the Secured Overnight Financing Rate, in which case the note will be
a “compounded SOFR note”;
•
compounded SONIA, calculated by reference to the Sterling Overnight Index Average, in which case the note will be
a “compounded SONIA note”;
•
compounded CORRA, calculated by reference to the Canadian Overnight Repo Rate Average, in which case the note
will be a “compounded CORRA note”;
•
compounded AONIA, calculated by reference to the Australian dollar interbank overnight cash rate, in which case
the note will be a “compounded AONIA note”; and
•
simple average SOFR, calculated by reference to the Secured Overnight Financing Rate, in which case the note will
be a “simple average SOFR note.”
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The description of the terms and provisions of floating-rate notes in this prospectus
supplement generally is divided into (i) a description of floating-rate notes that use a “payment delay convention” with respect to interest accrual and payment and (ii) a description of floating-rate notes that do not use such
convention, and is summarized as follows:
•
Floating-Rate Notes with Payment Delay
. Compounded SOFR, compounded SONIA, compounded CORRA or compounded
AONIA may be the base rate for floating-rate notes that use the “payment delay convention.” For such notes, accrued interest is calculated and paid with respect to interest periods that run from, and including, each interest period
demarcation date specified in the applicable supplement (or, in the case of the initial interest period, the issue date) to, but excluding the next following interest period demarcation date (or, in the case of the final interest period, the
maturity date or, if the floating-rate notes are redeemed earlier, the redemption date). Interest will be paid on interest payment dates falling a specified number of days after the interest period demarcation date at the end of each interest
period, as set forth under “—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA” below or in the applicable supplement. Compounded SOFR, compounded SONIA, compounded CORRA or
compounded AONIA, as applicable, for an interest period will be determined on the basis of a compounded average of SOFR, SONIA, CORRA or AONIA, as applicable, calculated in arrears at the end of each applicable interest period in accordance with the
applicable formula set forth below under “—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA.”
The full terms and provisions with respect to floating-rate notes using the “payment delay convention” are set forth below under
“—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA,” which sets forth general terms and provisions applicable to all series of floating-rate notes using the “payment delay
convention” and specific terms and provisions for the determination of compounded SOFR, compounded SONIA, compounded CORRA and compounded AONIA. The terms and provisions set forth in such section will govern and control with respect to such
notes.
•
Floating-Rate Notes without Payment Delay
. The base rate for floating-rate notes not using the
“payment delay convention” may be any of the base rates set forth above, as specified in the applicable supplement, or any other base rate as may be specified in the applicable supplement. For such notes, accrued interest is calculated
and paid with respect to interest periods that run from, and including, each interest payment date specified in the applicable supplement (or, in the case of the initial interest period, the issue date) to, but excluding, the next following interest
payment date (or, in the case of the final interest period, the maturity date or, if the floating-rate notes are redeemed earlier, the redemption date). Interest will be paid on the interest payment dates specified in the applicable supplement. The
base rate for such notes may be determined either in advance, at or prior to the beginning of each interest period, or in arrears near the end of each interest period, summarized as follows:
•
Determination of Base Rate in Advance.
If the base rate for a series of floating-rate notes is BBSW,
EURIBOR, federal funds (effective) rate, prime rate or the treasury (auction) rate (each, an “In Advance Base Rate”), the applicable base rate will be determined for an interest period in advance by reference to such base rate as
observed at a specified time on an interest determination date occurring on or prior to the commencement of such interest period, all as set forth in this prospectus supplement and/or in the applicable supplement. Such base rate as so determined
will apply for the entirety of the interest period commencing on or directly after the applicable interest determination date, and will reset on the interest reset date falling at the end of such interest period.
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•
Determination of Base Rate in Arrears.
If the base rate for a series of floating-rate notes is compounded
SOFR, compounded SONIA, compounded CORRA, compounded AONIA or simple average SOFR (each, an “In Arrears Base Rate”), the applicable base rate for an interest period will be determined on the basis of a compounded or simple average of
SOFR, SONIA, CORRA or AONIA, as applicable, calculated in arrears at or near the end of each applicable interest period in accordance with the formula or the terms and provisions for such calculation set forth in the applicable section of
“—Floating-Rate Notes without Payment Delay—Determination of Base Rates.” Such base rates may be calculated in accordance with a number of different calculation conventions that are described more fully under the applicable
section of “—Floating-Rate Notes without Payment Delay—Determination of Base Rates.” The applicable supplement will specify which calculation convention applies with respect to calculation of the base rate for an applicable
series of floating-rate notes.
The full terms and provisions with respect to floating-rate notes not using the
“payment delay convention” are set forth below under “—Floating Rate Notes without Payment Delay,” which sets forth general terms and provisions applicable to all such series of floating-rate notes without payment delay
and specific terms and provisions for the determination of each base rate. The terms and provisions set forth in such section will govern and control with respect to such notes.
The interest rate applicable during each interest period for a series of floating-rate notes will be determined by the calculation agent. See
“—Calculation Agents; Decisions and Determinations.”
Payment Delay Notes – Compounded SOFR, Compounded
SONIA, Compounded CORRA and Compounded AONIA
Accrued interest, interest periods, the interest rate and/or timing of interest
payments for a particular interest period, among other terms and provisions of compounded SOFR notes, compounded SONIA notes, compounded CORRA notes and compounded AONIA notes, will be determined in accordance with a “payment delay
convention,” if so specified in the applicable supplement. The terms and provisions of such notes relating to accrued interest, interest periods, the interest rate and/or timing of interest payments for a particular interest period, among
other terms and provisions of the notes, differ from the terms and provisions that generally are applicable to notes that do not use a payment delay convention.
If the applicable supplement for a series of compounded SOFR notes, compounded SONIA notes, compounded CORRA notes or compounded AONIA
notes specifies that the “payment delay convention” applies, then the following terms and provisions will apply to such series. References to “notes” in this section “—Payment Delay Notes—Compounded SOFR,
Compounded SONIA, Compounded CORRA and Compounded AONIA” are to compounded SOFR notes, compounded SONIA notes, compounded CORRA notes or compounded AONIA, as applicable, using the payment delay convention.
General Terms and Provisions Applicable to the Notes Using the Payment Delay Convention
Each series of notes will accrue interest from the original issue date of such series until the principal amount is paid or made available for
payment at a rate per annum equal to compounded SOFR, compounded SONIA, compounded CORRA or compounded AONIA, as specified in the applicable supplement, plus or minus the spread (if any), or multiplied by the spread multiplier (if any), as may be
specified in the applicable supplement. The “spread” is the number of basis points we may specify to be added to or subtracted from the applicable base rate. The “spread multiplier” is the percentage (or number) we may
specify by which the specified base rate is multiplied in order to calculate the applicable interest rate.
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The interest rate for a series of notes also may be subject to (i) a maximum interest
rate limit, or ceiling, on the interest that may accrue during any interest or other applicable period; and/or (ii) a minimum interest rate limit, or floor, on the interest that may accrue during any interest or other applicable period.
The interest rate for a series of notes will be determined by reference to compounded SOFR, compounded SONIA, compounded CORRA or compounded
AONIA, calculated in respect of each interest period in accordance with the formula set forth under “—Determination of Compounded SOFR (Payment Delay),” “—Determination of Compounded SONIA (Payment Delay),”
“—Determination of Compounded CORRA (Payment Delay)” or “—Determination of Compounded AONIA (Payment Delay)” below, and the terms and provisions of the notes set forth under “—Effect of a USD Benchmark
Transition Event and Related USD Benchmark Replacement Date with Respect to SOFR” or “—Effect of a
Non-USD
Benchmark Transition Event and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA.”
We will pay interest
on a series of notes on each interest payment date with respect to such series of notes. Each interest payment due on an interest payment date, the maturity date or the redemption date, as applicable, will include interest accrued from, and
including, the most recent interest period demarcation date to which interest has been paid, or, if no interest has been paid, from the original issue date, to, but excluding, the next interest period demarcation date (or, in the case of the final
interest period, the maturity date or, if such notes are redeemed earlier, the redemption date) (each such period, an “interest period” for such series of notes). The applicable supplement for a series of notes will specify, among other
terms and provisions, the “interest period demarcation dates” with respect to such series.
We will pay interest on each
series of notes in arrears, on the second business day (or such other number of business days we may specify in the applicable supplement) following each interest period demarcation date (each such day being an “interest payment date”
for such notes); provided that the interest payment date with respect to the final interest period for a series of notes will be the maturity date for such series or, if the notes are redeemed earlier, the redemption date. On each interest payment
date, we will pay accrued interest for the most recently completed interest period.
If an interest period demarcation date other than the
final interest period demarcation date otherwise would fall on a day that is not a business day, then such interest period demarcation date will be postponed to the next day that is a business day, except that, if the next succeeding business day
falls in the next calendar month, then such interest period demarcation date will be advanced to the immediately preceding day that is a business day. If the scheduled final interest period demarcation date (which will be the maturity date or, if we
elect to redeem the notes earlier, the redemption date) falls on a day that is not a business day, the payment of principal and interest will be made on the next succeeding business day, and such final interest period demarcation date (and the
related maturity date or redemption date falling on such final interest period demarcation date) will be postponed to such succeeding business day. In each case, the related interest periods also will be adjusted for
non-business
days.
With respect to any series of fixed/floating rate notes for which compounded
SOFR, compounded SONIA, compounded CORRA or compounded AONIA is specified to be the base rate for the applicable floating-rate period and for which the payment delay convention is specified to be applicable, notwithstanding anything to the contrary
in the applicable terms and provisions of the notes, and provided that such series of notes is not redeemed prior to the commencement of the floating-rate period, if the final interest payment date falling in the fixed-rate period otherwise would
fall on a day that is not a business day, then such interest payment date will be postponed to the next day that is a business day, and the related interest period also will be adjusted for
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non-business
days. If such final interest payment date during the fixed-rate period is so postponed, the first day of the initial interest period during
the floating-rate period will be adjusted accordingly.
The calculation agent will determine compounded SOFR, compounded SONIA, compounded
CORRA or compounded AONIA, as applicable, the interest rate and accrued interest for each interest period in arrears as soon as reasonably practicable on or after the interest period demarcation date at the end of such interest period (or, in the
case of the final interest period, the rate
cut-off
date) and prior to the relevant interest payment date and will notify us of compounded SOFR, compounded SONIA, compounded CORRA or compounded AONIA, as
applicable, and such interest rate and accrued interest for each interest period as soon as reasonably practicable after such determination, but in any event by the business day immediately prior to the interest payment date.
All amounts resulting from any calculation on a note will be rounded to the nearest cent, in the case of U.S. dollars and Canadian dollars, or
to the nearest pence, in the case of pounds sterling, with
one-half
cent or pence, as applicable, being rounded upward. All percentages resulting from any calculation with respect to a note will be rounded, if
necessary, to the nearest one hundred-thousandth of a percent, with five
one-millionths
of a percentage point rounded upwards, e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655).
Determination of Compounded SOFR (Payment Delay)
The calculation agent will determine “compounded SOFR” for a series of notes for each interest period in accordance with the
formula set forth below. For purposes of calculating compounded SOFR in accordance with such formula with respect to the final interest period, SOFR for each U.S. government securities business day in the period from, and including, the rate
cut-off
date to, but excluding, the maturity date or redemption date, as applicable, will be SOFR in respect of such rate
cut-off
date. The “rate
cut-off
date” will be the second U.S. government securities business day (or such other number of U.S. government securities business days as we may specify in the applicable supplement) prior to the maturity
date or the redemption date, as applicable.
where:
“
d
0
”, for any interest period, is the number of U.S. government
securities business days in such interest period;
“
i
”, for such interest period, is a series of whole numbers from one
to
d
0
, each representing the relevant U.S. government securities business days in chronological order from, and including, the first U.S. government securities business day in such
interest period;
“
SOFR
i
” for any U.S. government
securities business day “
i
” in such interest period, is equal to SOFR in respect of that day, determined by the calculation agent; provided that, for purposes of calculating compounded SOFR with respect to the final interest
period, SOFR for each U.S. government securities business day in the period from, and including, the rate
cut-off
date to, but excluding, the maturity date or redemption date, as applicable, will be SOFR in
respect of such rate
cut-off
date;
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“
n
i
” for
U.S. government securities business day “
i
” in such interest period, is the number of calendar days from, and including, such U.S. government securities business day “
i
” to, but excluding, the following U.S.
government securities business day; and
“
d
” , for such interest period, is the number of calendar days in such
interest period.
For purposes of the foregoing terms and provisions, the following terms have the meanings set forth below:
“SOFR” means, with respect to any U.S. government securities business day prior to a USD Benchmark Replacement Date:
(1)
the Secured Overnight Financing Rate published for such U.S. government securities business day as such rate
appears on the SOFR Administrator’s Website at 3:00 p.m. (New York City time) on the immediately following U.S. government securities business day; or
(2)
if the rate specified in (1) above does not so appear, the Secured Overnight Financing Rate as published
in respect of the first preceding U.S. government securities business day for which the Secured Overnight Financing Rate was published on the SOFR Administrator’s Website.
Notwithstanding the foregoing, if we or our designee, after consulting with us, determines that a USD Benchmark Transition Event and related
USD Benchmark Replacement Date have occurred prior to the applicable USD Benchmark Reference Time in respect of any determination of SOFR on any date as described under “—Effect of a USD Benchmark Transition Event and Related USD
Benchmark Replacement Date with Respect to SOFR” below, then the USD benchmark transition provisions set forth under such heading will thereafter apply to all determinations of the interest rate payable on the relevant notes. In accordance
with the USD benchmark transition provisions, after a USD Benchmark Transition Event and related USD Benchmark Replacement Date have occurred, the amount of interest that will be payable for each applicable interest period will be determined by
reference to a per annum rate equal to the USD Benchmark Replacement plus or minus the spread, or multiplied by the spread multiplier, as may be specified in the applicable supplement. Certain capitalized terms used in this paragraph have the
meanings set forth under “—Effect of a USD Benchmark Transition Event and Related USD Benchmark Replacement Date with Respect to SOFR.”
“SOFR Administrator” means the FRBNY (or a successor administrator of the Secured Overnight Financing Rate).
“SOFR Administrator’s Website” means the website of the FRBNY, or any successor source. The information contained on such
website is not part of this prospectus supplement and is not incorporated in this prospectus supplement by reference.
Determination
of Compounded SONIA (Payment Delay)
The calculation agent will determine “compounded SONIA” for a series of notes for
each interest period in accordance with the formula set forth below. For purposes of calculating compounded SONIA in accordance with such formula with respect to the final interest period, SONIA for each London banking day in the period from, and
including, the rate
cut-off
date to, but excluding, the maturity date or redemption date, as applicable, will be SONIA in respect of such rate
cut-off
date. The
“rate
cut-off
date” will be the fifth London banking day (or such other number
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of London banking days as we may specify in the applicable supplement) prior to the maturity date or the redemption date, as applicable.
where:
“
d
0
”, for any interest period, is the number of London banking days
in such interest period;
“
i
”, for such interest period, is a series of whole numbers from one to
d
0
, each representing the relevant London banking days in chronological order from, and including, the first London banking day in such interest period;
“
SONIA
i
” means, in relation to any London banking day
“
i
” in such interest period, SONIA in respect of that day, determined by the calculation agent; provided that, for purposes of calculating compounded SONIA with respect to the final interest period, SONIA for each London banking
day in the period from, and including, the rate
cut-off
date to, but excluding, the maturity date or redemption date, as applicable, will be SONIA in respect of such rate
cut-off
date;
“
n
i
” means, in relation to any London banking day
“
i
” in such interest period, the number of calendar days from, and including, such London banking day “
i
” to, but excluding, the next following London banking day; and
“
d
”, for such interest period, is the number of calendar days in such interest period.
For purposes of the foregoing terms and provisions, the following terms have the meanings set forth below:
“SONIA” means, in relation to any London banking day, the daily Sterling Overnight Index Average rate for such London banking day
as provided by the administrator of SONIA to authorized distributors and as then published on the SONIA Screen Page or, if the SONIA Screen Page is unavailable, as otherwise published by such authorized distributors in each case at 12:00 p.m.,
London time, on the London banking day immediately following such London banking day; provided that if, in respect of any London banking day, the calculation agent determines that the SONIA rate is not available on the SONIA Screen Page or has not
otherwise been published by the relevant authorized distributors, such SONIA rate shall be:
(1)
(i) the BoE’s Bank Rate (the “Bank Rate”) prevailing at 5:00 p.m., London time (or, if
earlier, close of business) on the relevant London banking day; plus (ii) the mean of the spread of the SONIA rate to the Bank Rate over the previous five days on which a SONIA rate has been published, excluding the highest spread (or, if there
is more than one highest spread, one only of those highest spreads) and lowest spread (or, if there is more than one lowest spread, one only of those lowest spreads); or
(2)
if the Bank Rate is not published by the BoE at 5:00 p.m., London time (or, if earlier, close of business) on
the relevant London banking day, the SONIA rate published on the SONIA Screen Page (or otherwise published by the relevant authorized distributors) for the first preceding London banking day on which the SONIA rate was published on the SONIA Screen
Page (or otherwise published by the relevant authorized distributors).
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Notwithstanding the foregoing, if we or our designee, after consulting with us, determines
that a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark Replacement Date have occurred prior to the applicable
Non-USD
Benchmark Reference Time in respect of any determination of SONIA on any date as described under “—Effect of a
Non-USD
Benchmark Transition Event and
Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA” below, then the
Non-USD
benchmark transition provisions set forth under such heading
will thereafter apply to all determinations of the interest rate payable on the relevant notes. In accordance with the
Non-USD
benchmark transition provisions, after a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark Replacement Date have occurred, the amount of interest that will be payable for each applicable interest
period will be determined by reference to a per annum rate equal to the
Non-USD
Benchmark Replacement plus or minus the spread, or multiplied by the spread multiplier, as may be specified in the applicable
supplement. Certain capitalized terms used in this paragraph have the meanings set forth under “—Effect of a
Non-USD
Benchmark Transition Event and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA.”
Notwithstanding the
foregoing provisions, in the event the BoE publishes guidance as to (i) how SONIA is to be determined or (ii) any rate of interest that is to replace the SONIA rate, the calculation agent shall, in consultation with us, follow such
guidance in order to determine the SONIA rate for so long as the SONIA rate is not available or has not been published by the authorized distributors.
“SONIA Screen Page” means Reuters Screen SONIA Page or such other page, section or other part as may replace it as may be
nominated by the person providing or sponsoring the information appearing there for the purpose of displaying rates or prices comparable to SONIA.
Determination of Compounded CORRA (Payment Delay)
The calculation agent will determine “compounded CORRA” for a series of notes for each interest period in accordance with the
formula set forth below. For purposes of calculating compounded CORRA in accordance with such formula with respect to the final interest period, CORRA for each Toronto banking day in the period from, and including, the rate
cut-off
date to, but excluding, the maturity date or redemption date, as applicable, will be CORRA in respect of such rate
cut-off
date. The “rate
cut-off
date” will be the second Toronto banking day (or such other number of Toronto banking days as we may specify in the applicable supplement) prior to the maturity date or the redemption date, as
applicable.
where:
“
d
0
”, for any interest period, is the number of Toronto banking
days in such interest period;
“
i
”, for such interest period, is a series of whole numbers from one to
d
0
, each representing the relevant Toronto banking days in chronological order from, and including, the first Toronto banking day in such interest period;
“
CORRA
i
” means, in respect of any Toronto banking day
“
i
” in such interest period, CORRA in respect of that day, determined by the calculation agent; provided that, for purposes of calculating compounded CORRA with respect to the final interest period, CORRA for each
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Toronto banking day in the period from, and including, the rate
cut-off
date to, but excluding, the maturity date or redemption date, as applicable, will
be CORRA in respect of such rate
cut-off
date;
“
n
i
” for Toronto banking day “
i
” in such interest period, is the number of calendar days from, and including, such Toronto banking day “
i
” to, but
excluding, the following Toronto banking day; and
“
d
”, for such interest period, is the number of calendar days in
such interest period.
For purposes of the foregoing terms and provisions, the following terms have the meanings set forth below:
“CORRA” means, in respect of any Toronto banking day:
(1)
a reference rate equal to the daily Canada Overnight Repo Rate Average for such Toronto banking day as provided
by the Bank of Canada (or any successor administrator of such rate) as administrator of CORRA to authorized distributors and as then published on the Bank of Canada’s website, or any successor website designated by the Bank of Canada or any
successor administrator, at any time the Bank of Canada (or such successor administrator) is administrator of CORRA, or such other source or page as is specified in the applicable supplement or, if the Bank of Canada’s website or such other
source or page as is specified in the applicable supplement, as applicable, is unavailable, as otherwise published by such authorized distributors (in each case, at approximately 11:00 a.m., Toronto time (or such other time as is specified in the
applicable supplement), on the Toronto banking day immediately following such Toronto banking day); or
(2)
if, in respect of any applicable Toronto banking day, the calculation agent determines that CORRA is not
available in accordance with (1) above or has not otherwise been published by the relevant authorized distributors, the calculation agent will determine CORRA for such applicable Toronto banking day as being CORRA in respect of the most recent
Toronto banking day for which CORRA was published in accordance with (1) above or as otherwise published by the relevant authorized distributors.
Notwithstanding the foregoing, upon the occurrence of an Index Cessation Event with respect to CORRA or an Applicable Fallback Rate, the terms
and provisions set forth in (i) and (ii) below will apply, in the order set forth below, with respect to an applicable series of compounded CORRA notes. In addition, in connection with the implementation of an Applicable Fallback Rate, we or
our designee (after consulting with us) may make such changes or adjustments to (1) the Applicable Fallback Rate or the applicable fallback spread, (2) any observation period, interest payment date, other relevant date, business day
convention or interest period, (3) the manner, timing and frequency of determining rates and amounts of interest that are payable on the compounded CORRA notes and the conventions relating to such determination, (4) the timing and
frequency of making payments of interest, (5) rounding conventions, (6) tenors, and (7) any other terms or provisions of the relevant series of compounded CORRA notes and related definitions, in each case that we or our designee
(after consulting with us) determines, from time to time, and notifies to the calculation agent, are consistent with accepted market practice or applicable regulatory or legislative action or guidance for the use of such Applicable Fallback Rate for
debt obligations comparable to the relevant series of compounded CORRA notes in such circumstances.
(i)
Index Cessation Effective Date with respect to CORRA
. If an Index Cessation Effective Date occurs
with respect to CORRA, then the rate for an applicable interest period in respect of which any day of such interest period occurs on or after the Index Cessation Effective Date with respect to CORRA will be the CAD Recommended Rate, to
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which the calculation agent shall apply a spread (which may be positive or negative or zero) and make such adjustments to the CAD Recommended Rate as are necessary to account for any difference
in term structure or tenor of the CAD Recommended Rate by comparison to CORRA (if any), with such spread and adjustments (if any) being determined by us or our designee (after consulting with us). If there is a CAD Recommended Rate before the end of
the first Toronto banking day following the Index Cessation Effective Date with respect to CORRA but neither the administrator nor authorized distributors provide or publish the CAD Recommended Rate and an Index Cessation Effective Date with respect
to it has not occurred, then, in respect of any day for which the CAD Recommended Rate is required, references to the CAD Recommended Rate will be deemed to be references to the last provided or published CAD Recommended Rate.
(ii)
No CAD Recommended Rate or Index Cessation Effective Date with respect to CAD Recommended Rate
.
If there is no CAD Recommended Rate before the end of the first Toronto banking day following the Index Cessation Effective Date with respect to CORRA, or there is a CAD Recommended Rate and an Index Cessation Effective Date subsequently occurs with
respect to such CAD Recommended Rate, then the rate for an applicable interest period in respect of which any day of such interest period occurs on or after the Index Cessation Effective Date with respect to CORRA or the Index Cessation Effective
Date with respect to the CAD Recommended Rate, as applicable, will be Bank of Canada’s Target for the overnight rate as set by the Bank of Canada and published on the Bank of Canada’s website (the “BOC Target Rate”). If
neither the administrator nor authorized distributors provide or publish the BOC Target Rate, then, in respect of any day for which the BOC Target Rate is required, references to the BOC Target Rate will be deemed to be references to the last
provided or published BOC Target Rate.
As used in the foregoing terms and provisions relating to the determination of
CORRA:
“Applicable Fallback Rate” means the CAD Recommended Rate, or the BOC Target Rate, as applicable;
“CAD Recommended Rate” means the rate (inclusive of any spreads or adjustments) recommended as the replacement for CORRA by a
committee officially endorsed or convened by the Bank of Canada for the purpose of recommending a replacement for CORRA (which rate may be produced by the Bank of Canada or another administrator) and as provided by the administrator of that rate or,
if that rate is not provided by the administrator thereof (or a successor administrator), published by an authorized distributor;
“Index Cessation Effective Date” means, in respect of an Index Cessation Event, the first date on which CORRA or the Applicable
Fallback Rate, as applicable, is no longer provided. If CORRA or the Applicable Fallback Rate, as applicable, ceases to be provided on the same day that it is required to determine the base rate for an interest period pursuant to the terms of an
applicable series of compounded CORRA notes but it was provided at the time at which it is to be observed pursuant to the terms and provisions of such series of compounded CORRA notes (or, if no such time is specified in the terms and provisions of
such series, at the time at which it is ordinarily published), then the Index Cessation Effective Date will be the next day on which the rate would ordinarily have been published;
“Index Cessation Event” means:
(A)
a public statement or publication of information by or on behalf of the administrator or provider of CORRA or
the Applicable Fallback Rate, as applicable, announcing that it has ceased or will cease to provide CORRA or the Applicable Fallback Rate, as applicable,
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permanently or indefinitely, provided that, at the time of the statement or publication, there is no successor administrator or provider that will continue to provide CORRA or the Applicable
Fallback Rate, as applicable; or
(B)
a public statement or publication of information by the regulatory supervisor for the administrator or provider
of CORRA or the Applicable Fallback Rate, as applicable, the Bank of Canada, an insolvency official with jurisdiction over the administrator or provider for CORRA or the Applicable Fallback Rate, as applicable, a resolution authority with
jurisdiction over the administrator or provider for CORRA or the Applicable Fallback Rate, as applicable, or a court or an entity with similar insolvency or resolution authority over the administrator or provider for CORRA or the Applicable Fallback
Rate, as applicable, which states that the administrator or provider of CORRA or the Applicable Fallback Rate, as applicable, has ceased or will cease to provide CORRA or the Applicable Fallback Rate, as applicable, permanently or indefinitely,
provided that, at the time of the statement or publication, there is no successor administrator or provider that will continue to provide CORRA or the Applicable Fallback Rate, as applicable.
Determination of Compounded AONIA (Payment Delay)
The calculation agent will determine “compounded AONIA” for a series of notes for each interest period in accordance with the
formula set forth below. For purposes of calculating compounded AONIA in accordance with such formula with respect to the final interest period, AONIA for each Sydney banking day in the period from, and including, the rate
cut-off
date to, but excluding, the maturity date or redemption date, as applicable, will be AONIA in respect of such rate
cut-off
date. The “rate
cut-off
date” will be the second Sydney banking day (or such other number of Sydney banking days as we may specify in the applicable supplement) prior to the maturity date or the redemption date, as
applicable.
where:
“
d
0
”, for any interest period, is the number of Sydney banking days
in such interest period;
“
i
”, for such interest period, is a series of whole numbers from one to
d
0
, each representing the relevant Sydney banking days in chronological order from, and including, the first Sydney banking day in such interest period;
“
AONIA
i
” means, in respect of any Sydney banking day
“
i
” in such interest period, AONIA in respect of that day, determined by the calculation agent; provided that, for purposes of calculating compounded AONIA with respect to the final interest period, AONIA for each Sydney banking
day in the period from, and including, the rate
cut-off
date to, but excluding, the maturity date or redemption date, as applicable, will be AONIA in respect of such rate
cut-off
date;
“n
i
” for
Sydney banking day “
i
” in such interest period, is the number of calendar days from, and including, such Sydney banking day “
i
” to, but excluding, the following Sydney banking day; and
“
d
”, for such interest period, is the number of calendar days in such interest period.
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For purposes of the foregoing terms and provisions, the following terms have the meanings
set forth below:
“AONIA” means, in respect of any Sydney banking day:
(1)
a reference rate equal to the Australian dollar interbank overnight cash rate (AONIA) for such Sydney banking
day administered by the Reserve Bank of Australia (or any successor administrator of such rate) as provided by the Administrator to authorized distributors and as then published on the Refinitiv Screen RBA30 Page or on the Bloomberg Screen RBAO7
Page or on any successor screen page, or such other source or page as is specified in the applicable supplement or, if such screen page or such other source or page as is specified in the applicable supplement, as applicable, is unavailable, as
otherwise published by such authorized distributors (in each case, at approximately 4:00 p.m., Sydney time (or any amended publication time for the final intraday refix of such rate specified by the Administrator in its benchmark methodology) (or
such other time as is specified in the applicable supplement)), on the Sydney banking day immediately following such Sydney banking day; or
(2)
if, in respect of any applicable Sydney banking day, (i) the calculation agent determines that AONIA is
not available in accordance with (1) above or has not otherwise been published by the relevant authorized distributors or (ii) we or our designee (after consulting with us) determine that AONIA has been published or provided but there is
an obvious or proven error in such rate, the calculation agent will determine AONIA for such applicable Sydney banking day as being AONIA in respect of the most recent Sydney banking day for which AONIA was published in accordance with
(1) above or as otherwise published by the relevant authorized distributors.
Notwithstanding the foregoing, if a
Permanent Discontinuation Trigger has occurred with respect to AONIA, the terms and provisions set forth in (i) and (ii) below (such terms and provisions, the “AONIA Fallback Provisions”) will apply, in the order set forth below,
with respect to an applicable series of compounded AONIA notes. In addition, in connection with the implementation of an Applicable Fallback Rate, we or our designee (after consulting with us) may make such changes or adjustments to (1) the
Applicable Fallback Rate or the applicable fallback spread, (2) any observation period, interest payment date, other relevant date, business day convention or interest period, (3) the manner, timing and frequency of determining rates and
amounts of interest that are payable on the compounded AONIA notes and the conventions relating to such determination, (4) the timing and frequency of making payments of interest, (5) rounding conventions, (6) tenors, and (7) any
other terms or provisions of the relevant series of compounded AONIA notes and related definitions, in each case that we or our designee (after consulting with us) determines, from time to time, and notifies to the calculation agent, are consistent
with accepted market practice or applicable regulatory or legislative action or guidance for the use of such Applicable Fallback Rate for debt obligations comparable to the relevant series of compounded AONIA notes in such circumstances.
(i)
Permanent Discontinuation Trigger with respect to AONIA
. If a Permanent Discontinuation Trigger
has occurred with respect to AONIA, the rate for any day for which AONIA is required on or after the AONIA Permanent Fallback Effective Date will be the first rate available in the following order of precedence:
(A)
if at the time of the AONIA Permanent Fallback Effective Date, an RBA Recommended Rate has been created but no
RBA Recommended Rate Permanent Fallback Effective Date has occurred, the RBA Recommended Rate; and
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(B)
if paragraph (A) above does not apply, the Final Fallback Rate; and
(ii)
Permanent Discontinuation Trigger with respect to RBA Recommended Rate.
Where a determination of
the RBA Recommended Rate is required for the purposes of paragraph (i) above, if a Permanent Discontinuation Trigger has occurred with respect to the RBA Recommended Rate, the rate for any day for which the RBA Recommended Rate is required on
or after that Permanent Fallback Effective Date will be the Final Fallback Rate.
When calculating an amount of interest
in circumstances where an Applicable Fallback Rate other than the Final Fallback Rate applies, that interest will be calculated as if references to AONIA were references to such Applicable Fallback Rate. When calculating interest in circumstances
where the Final Fallback Rate applies, the amount of interest will be calculated on the same basis as if the Applicable Benchmark Rate in effect immediately prior to the application of that Final Fallback Rate remained in effect but with necessary
adjustments to substitute all references to that Applicable Benchmark Rate with corresponding references to the Final Fallback Rate.
As
used in the foregoing terms and provisions relating to the determination of AONIA:
“Administrator” means:
(A)
in respect of AONIA, the Reserve Bank of Australia; and
(B)
in respect of any other Applicable Benchmark Rate, the administrator for that rate or benchmark or, if there is
no administrator, the provider of that rate or benchmark,
and, in each case, any successor administrator or, as applicable, any
successor administrator or provider;
“Applicable Benchmark Rate” means, initially, AONIA; provided that if a Permanent
Fallback Effective Date has occurred with respect to AONIA or the then-current Applicable Benchmark Rate, then the Applicable Fallback Rate;
“Applicable Fallback Rate” means, where a Permanent Discontinuation Trigger for an Applicable Benchmark Rate has occurred, the
rate that applies to replace that Applicable Benchmark Rate in accordance with the AONIA Fallback Provisions;
“Final Fallback
Rate” means, in respect of an Applicable Benchmark Rate, the rate:
(A)
determined by us or our designee (after consulting with us) as a commercially reasonable alternative for the
Applicable Benchmark Rate taking into account all available information that, in good faith, we or our designee (after consulting with us) considers relevant, provided that any rate (inclusive of any spreads or adjustments) implemented by central
counterparties and/or futures exchanges with representative trade volumes in derivatives or futures referencing the Applicable Benchmark Rate will be deemed to be acceptable for the purposes of this paragraph (A), together with (without double
counting) such spread adjustment (which may be a positive or negative value or zero) that is customarily applied to the relevant successor rate or alternative rate (as the case may be) in international debt capital markets transactions to produce an
industry-accepted replacement rate for AONIA-linked floating rate notes at such time, or, if no such industry standard is recognized or acknowledged, the spread adjustment determined in accordance with a method for calculating or determining such
spread adjustment determined by us or our designee (after consulting with us) to be appropriate; provided that
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(B)
if and for so long as no such successor rate or alternative rate can be determined in accordance with paragraph
(A), the Final Fallback Rate will be the last provided or published level of that Applicable Benchmark Rate;
“Non-Representative”
means, in respect of an Applicable Benchmark Rate, that the Administrator of the Applicable Benchmark Rate:
(A)
has determined that such Applicable Benchmark Rate is no longer, or as of a specified future date will no
longer be, representative of the underlying market and economic reality that such Applicable Benchmark Rate is intended to measure and that representativeness will not be restored; and
(B)
is aware that such determination will engage certain contractual triggers for fallbacks activated by
pre-cessation
announcements by such Supervisor (howsoever described) in contracts;
“Permanent Discontinuation Trigger” means, in respect of an Applicable Benchmark Rate:
(A)
a public statement or publication of information by or on behalf of the Administrator of the Applicable
Benchmark Rate announcing that it has ceased or that it will cease to provide the Applicable Benchmark Rate permanently or indefinitely, provided that, at the time of the statement or publication, there is no successor administrator or provider, as
applicable, that will continue to provide the Applicable Benchmark Rate;
(B)
a public statement or publication of information by the Supervisor of the Applicable Benchmark Rate, the
Reserve Bank of Australia (or any successor central bank for Australian dollars), an insolvency official or resolution authority with jurisdiction over the Administrator of the Applicable Benchmark Rate or a court or an entity with similar
insolvency or resolution authority over the Administrator of the Applicable Benchmark Rate which states that the Administrator of the Applicable Benchmark Rate has ceased or will cease to provide the Applicable Benchmark Rate permanently or
indefinitely, provided that, at the time of the statement or publication, there is no successor administrator or provider that will continue to provide the Applicable Benchmark Rate;
(C)
a public statement by the Administrator of the Applicable Benchmark Rate if the Applicable Benchmark Rate is
AONIA or the RBA Recommended Rate, as a consequence of which the Applicable Benchmark Rate will be prohibited from being used either generally, or in respect of applicable series of compounded AONIA notes, or that its use will be subject to
restrictions or adverse consequences to us or a holder of the applicable series of compounded AONIA notes;
(D)
as a consequence of a change in law or directive arising after the original issue date of an applicable series
of compounded AONIA notes, it has become unlawful for the applicable calculation agent, us or any other party responsible for calculations of interest under the terms and provisions of the applicable series of compounded AONIA notes to calculate any
payments due to be made using the Applicable Benchmark Rate;
(E)
a public statement or publication of information by the Administrator of the Applicable Benchmark Rate if the
Applicable Benchmark Rate is AONIA or the RBA Recommended Rate, stating that the Applicable Benchmark Rate is
Non-Representative;
or
(F)
the Applicable Benchmark Rate has otherwise ceased to exist or be administered on a permanent or indefinite
basis;
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“Permanent Fallback Effective Date” means, in respect of a Permanent
Discontinuation Trigger for an Applicable Benchmark Rate:
(A)
in the case of paragraphs (A) and (B) of the definition of “Permanent Discontinuation
Trigger,” the first date on which the Applicable Benchmark Rate would ordinarily have been published or provided and is no longer published or provided;
(B)
in the case of paragraphs (C) and (D) of the definition of “Permanent Discontinuation
Trigger,” the date from which use of the Applicable Benchmark Rate is prohibited or becomes subject to restrictions or adverse consequences or the calculation becomes unlawful, as applicable;
(C)
in the case of paragraph (E) of the definition of “Permanent Discontinuation Trigger,” the
first date on which the Applicable Benchmark Rate would ordinarily have been published or provided but is
Non-Representative
by reference to the most recent statement or publication contemplated in that
paragraph and even if such Applicable Benchmark Rate continues to be published or provided on such date; or
(D)
in the case of paragraph (F) of the definition of “Permanent Discontinuation Trigger,” the
date that event occurs;
“RBA Recommended Rate” means, in respect of any relevant day (including any day
“
i
”), the rate (inclusive of any spreads or adjustments) recommended as the replacement for AONIA by the Reserve Bank of Australia (which rate may be produced by the Reserve Bank of Australia or another administrator) and as
provided by the Administrator of that rate or, if that rate is not provided by the Administrator thereof, published by an authorized distributor in respect of that day;
“Supervisor” means, in respect of an Applicable Benchmark Rate, the supervisor or competent authority that is responsible for
supervising that Applicable Benchmark Rate or the Administrator of that Applicable Benchmark Rate, or any committee officially endorsed or convened by any such supervisor or competent authority that is responsible for supervising that Applicable
Benchmark Rate or the Administrator of that Applicable Benchmark Rate;
“Sydney banking day”
means any day on which
commercial banks are open for general business in Sydney.
Floating-Rate Notes without Payment Delay
With respect to any series of notes listed below, the applicable terms and provisions of and other information with respect to the notes
set forth in this section “—Floating-Rate Notes without Payment Delay” will apply to such series, as and to the extent set forth in this section:
•
BBSW notes;
•
EURIBOR notes;
•
federal funds (effective) rate notes;
•
prime rate notes;
•
treasury (auction) rate notes;
•
compounded SOFR notes (other than compounded SOFR notes using the payment delay convention);
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•
compounded SONIA notes (other than compounded SONIA notes using the payment delay convention);
•
compounded CORRA notes (other than compounded CORRA notes using the payment delay convention);
•
compounded AONIA notes (other than compounded AONIA notes using the payment delay convention); and
•
simple average SOFR notes.
References to “notes” or “floating-rate notes” in this section “—Floating-Rate Notes without Payment
Delay” are to an applicable series of such notes.
General Terms and Provisions Applicable to the Notes
Determination of Interest Rates
The interest rate for a floating-rate note will be determined by reference to:
•
the specified base rate (based on the specified index maturity, if applicable) for each interest or other
applicable period determined in accordance with the applicable provisions set forth in this prospectus supplement and/or the applicable supplement;
•
plus or minus the spread, if any; and/or
•
multiplied by the spread multiplier, if any.
The “index maturity,” if applicable, is the period to maturity of the instrument for which the base rate is calculated and will be
specified in the applicable supplement. The “spread” is the number of basis points we may specify in the applicable supplement to be added to or subtracted from the applicable base rate. The “spread multiplier” is the
percentage (or number) we may specify in the applicable supplement by which the specified base rate is multiplied in order to calculate the applicable interest rate.
Interest rates for a floating-rate note also may be subject to:
•
a maximum interest rate limit, or ceiling, on the interest that may accrue during any interest or other
applicable period; and/or
•
a minimum interest rate limit, or floor, on the interest that may accrue during any interest or other applicable
period.
Accrual of Interest, Interest Payment Dates and Interest Periods
Each floating-rate note will accrue interest from its original issue date or from the most recent date to which interest on the floating-rate
note has been paid or made available for payment. Interest will accrue on the principal amount of a floating-rate note at the applicable per annum floating interest rate until the principal amount is paid or made available for payment. We will pay
accrued interest on any floating-rate note monthly, quarterly, semiannually or annually (or for such other period as we may specify in the applicable supplement), as applicable, in arrears, on the dates set forth in the applicable supplement (each
such day being an “interest payment date” for such floating-rate note) and at the maturity date or earlier redemption date, as applicable. Each
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interest payment due on an interest payment date, the maturity date or earlier redemption date, as the case may be, will include interest accrued from, and including, the most recent interest
payment date to which interest has been paid, or, if no interest has been paid, from the original issue date, to, but excluding, the next interest payment date or the maturity date or earlier redemption date, as the case may be (each such period, an
“interest period”). Interest payment dates and interest periods for floating-rate notes may be adjusted in accordance with the business day convention (as described below under “—Payment of Principal, Interest, and Other
Amounts Payable—Business Day Conventions”) specified in the applicable supplement.
Interest Reset Dates and Interest
Determination Dates for In Advance Base Rates
The terms and provisions set forth below in this section will apply to any series of
notes for which the base rate is specified in the applicable supplement to be BBSW, EURIBOR, federal funds (effective) rate, prime rate, the treasury (auction) rate or any other base rate as may be specified in the applicable supplement as an In
Advance Base Rate, but will not apply to series of notes for which the base rate is specified in the applicable supplement to be compounded SOFR, compounded SONIA, compounded CORRA, compounded AONIA or simple average SOFR.
The interest rate in effect from, and including, the original issue date of a series of floating-rate notes to, but excluding, the first
interest reset date for such notes will be the initial interest rate set forth in the applicable supplement or determined as set forth in the applicable supplement. The interest rate of a series of floating-rate notes may be reset daily, weekly,
monthly, quarterly, semiannually, or annually, or at any other interval, as we specify in the applicable supplement. If so specified in the applicable supplement, a single interest period may contain multiple interest reset dates, in which case the
interest rate with respect to the applicable series of notes will reset on each such interest reset date in accordance with the terms and provisions set forth in this section or as otherwise set forth in the applicable supplement, and interest will
accrue on such series of notes at the interest rate in effect from time to time during such interest period. We refer to each date on which the interest rate for a floating-rate note will reset as an “interest reset date.” We will
specify the interest reset dates in the applicable supplement. Interest reset dates may be adjusted in accordance with the applicable business day convention (as described below under “—Payment of Principal, Interest, and Other Amounts
Payable—Business Day Conventions”) specified in the applicable supplement.
The calculation agent will determine the interest
rate for an interest period on the corresponding interest determination date. The “interest determination date” in respect of any interest reset date is the day to which the calculation agent will refer when determining the interest rate
at which the applicable floating interest rate will reset. Unless we specify otherwise in the applicable supplement, the interest determination date for an interest reset date will be:
•
for a BBSW note, the first day of the relevant interest period;
•
for a EURIBOR note, the second TARGET Settlement Date preceding the interest reset date;
•
for a federal funds (effective) rate note or a prime rate note, the business day immediately preceding the
interest reset date;
•
for a treasury (auction) rate note, the day of the week in which the interest reset date falls on which Treasury
bills (as described below) would normally be auctioned; and
•
for a floating-rate note with two or more base rates, the most recent business day that is at least two business
days prior to the applicable interest reset date on which each applicable base rate is determinable.
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With respect to treasury (auction) rate notes, Treasury bills usually are sold at auction on
Monday of each week, unless that day is a legal holiday, in which case the auction usually is held on the following Tuesday, except that the auction may be held on the preceding Friday. If, as a result of a legal holiday, an auction is held on the
preceding Friday, that preceding Friday will be the interest determination date pertaining to the interest reset date occurring in the next succeeding week. The treasury (auction) rate will be determined as of that date, and the applicable interest
rate will take effect on the applicable interest reset date. If Treasury bills are sold at an auction that falls on a day that is an interest reset date, that interest reset date will be the next following business day unless we specify otherwise in
the applicable supplement.
In determining the base rate that applies to a EURIBOR note or a treasury (auction) rate note during a
particular interest period, the calculation agent may obtain rate quotes from various banks or dealers active in the relevant market, as described below under “—Determination of Base Rates” and/or in the applicable supplement.
Those reference banks and dealers may include the calculation agent itself and its affiliates, as well as any underwriter, dealer or agent participating in the distribution of the relevant notes, and its affiliates, and they may include our
affiliates.
Determination of Base Rates
The terms and provisions set forth below with respect to the determination of the base rate for BBSW notes, EURIBOR notes, federal funds
(effective) rate notes, prime rate notes, treasury (auction) rate notes, compounded SOFR notes (other than compounded SOFR notes using the payment delay convention), compounded SONIA notes (other than compounded SONIA notes using the payment delay
convention), compounded CORRA notes (other than compounded CORRA notes using the payment delay convention), compounded AONIA notes (other than compounded AONIA notes using the payment delay convention) and simple average SOFR notes will apply to
applicable series of floating-rate notes.
BBSW Notes
BBSW, for any interest determination date, will mean the rate for prime bank eligible securities having a tenor closest to the index maturity
specified in the applicable supplement which is designated as the “AVG MID” on the Refinitiv Screen ASX29 Page or Bloomberg Screen BBSW Page (or any designation which replaces that designation on that page, or any replacement page, as
applicable), or such other Relevant Screen Page as may be specified in the applicable supplement, at 12:00 Noon (Sydney time) (or any amended publication time for the final intraday refix of such rate specified by the Administrator for BBSW in its
benchmark methodology) on the interest determination date.
Notwithstanding the foregoing, if the calculation agent determines that a
Temporary Disruption Trigger has occurred with respect to BBSW as of any interest determination date, or if we or our designee (after consulting with us) determines that a Permanent Discontinuation Trigger has occurred with respect to BBSW as of any
interest determination date, the provisions set forth below under “—BBSW Fallback Provisions” (the “BBSW Fallback Provisions”) will apply, in the order set forth below, with respect to an applicable series of BBSW
notes. In addition, in connection with the implementation of an Applicable Fallback Rate following a Permanent Fallback Effective Date, we or our designee (after consulting with us) may make such changes or adjustments to (1) the Applicable
Fallback Rate or the spread thereon, (2) any interest determination date, interest payment date, other relevant date, business day convention or interest period, (3) the manner, timing and frequency of determining rates and amounts of
interest that are payable on the BBSW notes and the conventions relating to such determination, (4) the timing and frequency of making payments of interest, (5) rounding conventions, (6) tenors, and (7) any other terms or
provisions of the relevant series of BBSW notes and related definitions, in each case that we or our designee
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(after consulting with us) determines, from time to time, and notifies to the calculation agent, to be reasonable to reflect the implementation of such Applicable Fallback Rate giving due
consideration to any industry-accepted market practice for Australian-dollar denominated floating-rate notes.
BBSW Fallback
Provisions
If, in respect of any determination of BBSW on any applicable interest determination date for a series of BBSW notes:
(A)
the calculation agent determines that a Temporary Disruption Trigger has occurred; or
(B)
we or our designee (after consulting with us) determines that a Permanent Discontinuation Trigger has occurred,
then the base rate for the applicable interest period for an applicable series of BBSW notes, while such Temporary Disruption Trigger
is continuing or after a Permanent Discontinuation Trigger has occurred, will be (in the following order of precedence):
(A)
where BBSW is the Applicable Benchmark Rate, if a Temporary Disruption Trigger has occurred with respect to
BBSW, in the following order of precedence:
(i)
first, the Administrator Recommended Rate;
(ii)
then the Supervisor Recommended Rate; and
(iii)
lastly, the Final Fallback Rate;
(B)
where AONIA is the Applicable Benchmark Rate or is used in calculations of the Applicable Benchmark Rate, or a
determination of the AONIA Rate is required for the purposes of paragraph (A) above, if a Temporary Disruption Trigger has occurred with respect to AONIA, the rate for any day for which AONIA is required will be the last provided or published
level of AONIA;
(C)
where a determination of the RBA Recommended Rate is required for the purposes of paragraph (A) or (B)
above, if a Temporary Disruption Trigger has occurred with respect to the RBA Recommended Rate, the rate for any day for which the RBA Recommended Rate is required will be the last rate provided or published by the Administrator of the RBA
Recommended Rate (or if no such rate has been so provided or published, the last provided or published level of AONIA);
(D)
where BBSW is the Applicable Benchmark Rate, if a Permanent Discontinuation Trigger has occurred with respect
to BBSW, the rate for any day for which BBSW is required on or after the Permanent Fallback Effective Date will be the first rate available in the following order of precedence:
(i)
first, if at the time of the BBSW Permanent Fallback Effective Date, no AONIA Permanent Fallback Effective Date
has occurred, the AONIA Rate;
(ii)
then, if at the time of the BBSW Permanent Fallback Effective Date, an AONIA Permanent Fallback Effective Date
has occurred, an RBA Recommended Rate has been created but no RBA Recommended Rate Permanent Fallback Effective Date has occurred, the RBA Recommended Fallback Rate; and
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(iii)
lastly, if neither paragraph (i) nor paragraph (ii) above apply, the Final Fallback Rate;
(E)
where AONIA is the Applicable Benchmark Rate or is used in calculations of the Applicable Benchmark Rate, or a
determination of the AONIA Rate is required for the purposes of paragraph (D)(i) above, if a Permanent Discontinuation Trigger has occurred with respect to AONIA, the rate for any day for which AONIA is required on or after the AONIA Permanent
Fallback Effective Date will be the first rate available in the following order of precedence:
(i)
first, if at the time of the AONIA Permanent Fallback Effective Date, an RBA Recommended Rate has been created
but no RBA Recommended Rate Permanent Fallback Effective Date has occurred, the RBA Recommended Rate; and
(ii)
lastly, if paragraph (i) above does not apply, the Final Fallback Rate; and
(F)
where a determination of the RBA Recommended Rate is required for the purposes of paragraph (D) or (E)
above, respectively, if a Permanent Discontinuation Trigger has occurred with respect to the RBA Recommended Rate, the rate for any day for which the RBA Recommended Rate is required on or after that Permanent Fallback Effective Date will be the
Final Fallback Rate.
When calculating an amount of interest in circumstances where an Applicable Fallback Rate other
than the Final Fallback Rate applies, that interest will be calculated as if references to BBSW or the AONIA Rate, as applicable, were references to such Applicable Fallback Rate. When calculating interest in circumstances where the Final Fallback
Rate applies, the amount of interest will be calculated on the same basis as if the Applicable Benchmark Rate in effect immediately prior to the application of that Final Fallback Rate remained in effect but with necessary adjustments to substitute
all references to that Applicable Benchmark Rate with corresponding references to the Final Fallback Rate.
As used in the foregoing BBSW
Fallback Provisions:
“Adjustment Spread”
means the adjustment spread as at the Adjustment Spread Fixing Date (which
may be a positive or negative value or zero and determined pursuant to a formula or methodology) that is:
(a)
determined as the median of the historical differences between BBSW and AONIA over a five calendar year period
prior to the Adjustment Spread Fixing Date using practices based on those used for the determination of the Bloomberg Adjustment Spread as at December 1, 2022, provided that for so long as the Bloomberg Adjustment Spread is published and
determined based on the five year median of the historical differences between BBSW and AONIA, that adjustment spread will be deemed to be acceptable for the purposes of this paragraph (a); or
(b)
if no such median can be determined in accordance with paragraph (a), set using the method for calculating or
determining such adjustment spread determined by us or our designee (after consulting with us) to be appropriate;
“Adjustment Spread Fixing Date”
means the first date on which a Permanent Discontinuation Trigger occurs with respect to
BBSW;
“Administrator”
means:
(a)
in respect of BBSW, ASX Benchmarks Pty Limited;
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(b)
in respect of AONIA, the Reserve Bank of Australia; and
(c)
in respect of any other Applicable Benchmark Rate, the administrator for that rate or benchmark or, if there is
no administrator, the provider of that rate or benchmark,
and, in each case, any successor administrator or, as applicable, any
successor administrator or provider;
“Administrator Recommended Rate”
means the rate formally recommended for use as
the temporary replacement for BBSW by the Administrator of BBSW;
“AONIA” means, in respect of any Sydney banking day, a
reference rate equal to the Australia dollar interbank overnight cash rate (AONIA) for such Sydney banking day administered by the Reserve Bank of Australia (or any successor administrator of such rate) as provided by the Administrator to authorized
distributors and as then published on the Refinitiv Screen RBA30 Page or on the Bloomberg Screen RBAO7 Page or on any successor screen page or, if such screen page is unavailable, as otherwise published by such authorized distributors (in each case,
at approximately 4:00 p.m., Sydney time (or any amended publication time for the final intraday refix of such rate specified by the Administrator in its benchmark methodology)), on the Sydney banking day immediately following such Sydney banking
day;
“AONIA Observation Period”
means the period from, and including, the date falling five Sydney banking days prior
to the first day of the relevant interest period with respect to an applicable series of BBSW notes (and the first interest period with respect to any such series shall begin on, and include, the original issue date of such series) and ending on,
but excluding, the date falling five Sydney banking days prior to the interest payment date for such interest period (or the date falling five Sydney banking days prior to such earlier date, if any, on which the applicable series of BBSW notes
becomes due and payable);
“AONIA Rate”
means, for an applicable interest period with respect to an applicable series
of BBSW notes, and in respect of the applicable interest determination date for such interest period, the rate determined by the calculation agent to be Compounded Daily AONIA for that interest period and interest determination date plus the
Adjustment Spread;
“Applicable Benchmark Rate”
means, initially, BBSW; provided that if a Permanent Fallback Effective
Date has occurred with respect to BBSW or the then-current Applicable Benchmark Rate, then the Applicable Fallback Rate;
“Applicable Fallback Rate” means, where a Permanent Discontinuation Trigger for an Applicable Benchmark Rate has occurred, the
rate that applies to replace that Applicable Benchmark Rate in accordance with the BBSW Fallback Provisions;
“Bloomberg Adjustment
Spread”
means the term adjusted AONIA spread relating to BBSW provided by Bloomberg Index Services Limited (or a successor provider as approved and/or appointed by ISDA from time to time as the provider of term adjusted AONIA and the
spread) (“BISL”) on the Fallback Rate (AONIA) Screen (or by other means), or provided to, and published by, authorized distributors where Fallback Rate (AONIA) Screen means the Bloomberg Screen corresponding to the Bloomberg ticker for
the fallback for BBSW accessed via the Bloomberg Screen <FBAK> <GO> Page (or, if applicable, accessed via the Bloomberg Screen <HP> <GO>) or any other published source designated by BISL;
“Compounded Daily AONIA”
means, with respect to an interest period with respect to an applicable series of BBSW notes, the
rate of return of a daily compound interest investment during
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the AONIA Observation Period corresponding to such interest period (with AONIA as the reference rate for the calculation of interest) as calculated by the calculation agent on the fifth Sydney
banking day prior to the last day of each interest period, in accordance with the formula set forth below:
where:
“
AONIA
i
-
5SBD
” means the per annum rate expressed as a decimal which is the level of AONIA for the Sydney banking day falling five
Sydney banking days prior to such Sydney banking day “
i
”;
“
d
” is the number of calendar days
in the relevant interest period;
“
d
0
” is the number of
Sydney banking days in the relevant interest period;
“
i
” is a series of whole numbers from 1 to
d
0
, each representing the relevant Sydney banking days in chronological order from (and including) the first Sydney banking day in the relevant interest period to, and including, the last Sydney
banking day in such interest period; and
“
n
i
” for any
Sydney banking day “
i
”, means the number of calendar days from (and including) such Sydney banking day “
i
” up to (but excluding) the following Sydney banking day;
If, for any reason, Compounded Daily AONIA needs to be determined for a period other than an interest period, Compounded Daily AONIA is to be
determined as if that period were an interest period starting on, and including, the first day of that period and ending on, but excluding, the last day of that period (which will be the applicable interest payment date or the maturity date or
earlier redemption date, as the case may be);
“Final Fallback Rate”
means, in respect of an Applicable Benchmark Rate,
the rate:
(a)
determined by us or our designee (after consulting with us) as a commercially reasonable alternative for the
Applicable Benchmark Rate taking into account all available information that, in good faith, we or our designee (after consulting with us) considers relevant, provided that any rate (inclusive of any spreads or adjustments) implemented by central
counterparties and/or futures exchanges with representative trade volumes in derivatives or futures referencing the Applicable Benchmark Rate will be deemed to be acceptable for the purposes of this paragraph (a), together with (without double
counting) such spread adjustment (which may be a positive or negative value or zero) that is customarily applied to the relevant successor rate or alternative rate (as the case may be) in international debt capital markets transactions to produce an
industry-accepted replacement rate for Applicable Benchmark Rate-linked floating rate notes at such time (together with such other adjustments to the business day convention, interest determination dates and related provisions and definitions, in
each case that are consistent with accepted market practice for the use of such successor rate or alternative rate for Applicable Benchmark Rate-linked floating rate notes at such time), or, if no such industry standard is recognized or
acknowledged, the spread adjustment determined in accordance with a method for calculating or determining such spread adjustment determined by us or our designee (after consulting with us) to be appropriate; provided that
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(b)
if and for so long as no such successor rate or alternative rate can be determined in accordance with paragraph
(a), the Final Fallback Rate will be the last provided or published level of that Applicable Benchmark Rate;
“Non-Representative”
means, in respect of an Applicable Benchmark Rate, that the Supervisor of that Applicable Benchmark Rate if the Applicable Benchmark Rate is BBSW, or the Administrator of the
Applicable Benchmark Rate if the Applicable Benchmark Rate is AONIA (or if AONIA is used in calculations of the Applicable Benchmark Rate) or the RBA Recommended Rate:
(a)
has determined that such Applicable Benchmark Rate is no longer, or as of a specified future date will no
longer be, representative of the underlying market and economic reality that such Applicable Benchmark Rate is intended to measure and that representativeness will not be restored; and
(b)
is aware that such determination will engage certain contractual triggers for fallbacks activated by
pre-cessation
announcements by such Supervisor (howsoever described) in contracts;
“Permanent Discontinuation Trigger”
means, in respect of an Applicable Benchmark Rate:
(a)
a public statement or publication of information by or on behalf of the Administrator of the Applicable
Benchmark Rate announcing that it has ceased or that it will cease to provide the Applicable Benchmark Rate permanently or indefinitely, provided that, at the time of the statement or publication, there is no successor administrator or provider, as
applicable, that will continue to provide the Applicable Benchmark Rate and, in the case of BBSW, a public statement or publication of information by or on behalf of the Supervisor of BBSW has confirmed that cessation;
(b)
a public statement or publication of information by the Supervisor of the Applicable Benchmark Rate, the
Reserve Bank of Australia (or any successor central bank for Australian dollars), an insolvency official or resolution authority with jurisdiction over the Administrator of the Applicable Benchmark Rate or a court or an entity with similar
insolvency or resolution authority over the Administrator of the Applicable Benchmark Rate which states that the Administrator of the Applicable Benchmark Rate has ceased or will cease to provide the Applicable Benchmark Rate permanently or
indefinitely, provided that, at the time of the statement or publication, there is no successor administrator or provider that will continue to provide the Applicable Benchmark Rate and, in the case of BBSW and a public statement or publication of
information other than by the Supervisor, a public statement or publication of information by or on behalf of the Supervisor of BBSW has confirmed that cessation;
(c)
a public statement by the Supervisor of the Applicable Benchmark Rate if the Applicable Benchmark Rate is BBSW,
or the Administrator of the Applicable Benchmark Rate if the Applicable Benchmark Rate is AONIA (or if AONIA is used in calculations of the Applicable Benchmark Rate) or the RBA Recommended Rate, as a consequence of which the Applicable Benchmark
Rate will be prohibited from being used either generally, or in respect of an applicable series of BBSW notes, or that its use will be subject to restrictions or adverse consequences to us or the holders of the notes;
(d)
as a consequence of a change in law or directive arising after the original issue date of an applicable series
of BBSW notes, it has become unlawful for the calculation agent, us or any other party responsible for calculations of interest in respect of such series of BBSW notes to calculate any payments due to be made to any holder of such notes using the
Applicable Benchmark Rate;
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(e)
a public statement or publication of information by the Supervisor of the Applicable Benchmark Rate if the
Applicable Benchmark Rate is BBSW, or the Administrator of the Applicable Benchmark Rate if the Applicable Benchmark Rate is AONIA (or if AONIA is used in calculations of the Applicable Benchmark Rate) or the RBA Recommended Rate, stating that the
Applicable Benchmark Rate is
Non-Representative;
or
(f)
the Applicable Benchmark Rate has otherwise ceased to exist or be administered on a permanent or indefinite
basis;
“Permanent Fallback Effective Date”
means, in respect of a Permanent Discontinuation Trigger
for an Applicable Benchmark Rate:
(a)
in the case of paragraphs (a) and (b) of the definition of “Permanent Discontinuation
Trigger,” the first date on which the Applicable Benchmark Rate would ordinarily have been published or provided and is no longer published or provided;
(b)
in the case of paragraphs (c) and (d) of the definition of “Permanent Discontinuation
Trigger,” the date from which use of the Applicable Benchmark Rate is prohibited or becomes subject to restrictions or adverse consequences or the calculation becomes unlawful (as applicable);
(c)
in the case of paragraph (e) of the definition of “Permanent Discontinuation Trigger,” the
first date on which the Applicable Benchmark Rate would ordinarily have been published or provided but is
Non-Representative
by reference to the most recent statement or publication contemplated in that
paragraph and even if such Applicable Benchmark Rates continues to be published or provided on such date; or
(d)
in the case of paragraph (f) of the definition of “Permanent Discontinuation Trigger,” the
date that event occurs;
“RBA Recommended Fallback Rate” has the same meaning given to AONIA Rate but with
necessary adjustments to substitute all references to AONIA with corresponding references to the RBA Recommended Rate;
“RBA
Recommended Rate” means, in respect of any relevant day (including any day “
i
”), the rate (inclusive of any spreads or adjustments) recommended as the replacement for AONIA by the Reserve Bank of Australia (which rate may be
produced by the Reserve Bank of Australia or another administrator) and as provided by the Administrator of that rate or, if that rate is not provided by the Administrator thereof, published by an authorized distributor in respect of that day;
“Supervisor” means, in respect of an Applicable Benchmark Rate, the supervisor or competent authority that is responsible for
supervising that Applicable Benchmark Rate or the Administrator of that Applicable Benchmark Rate, or any committee officially endorsed or convened by any such supervisor or competent authority that is responsible for supervising that Applicable
Benchmark Rate or the Administrator of that Applicable Benchmark Rate;
“Supervisor Recommended Rate”
means the rate
formally recommended for use as the temporary replacement for BBSW by the Supervisor of BBSW;
“Sydney banking day”
means any day on which commercial banks are open for general business in Sydney;
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“Temporary Disruption Trigger” means, in respect of any Applicable Benchmark
Rate which is required for any determination:
(a)
the Applicable Benchmark Rate has not been published by the applicable Administrator or an authorized
distributor and is not otherwise provided by the Administrator, in respect of, on, for or by the time and date on which that Applicable Benchmark Rate is required; or
(b)
the Applicable Benchmark Rate is published or provided but the calculation agent determines that there is an
obvious or proven error in that rate.
EURIBOR Notes
The Euro-zone interbank offered rate (“EURIBOR”), for any interest determination date, will mean the rate for deposits in euro as
sponsored, calculated, and published by the EMMI having the index maturity specified in the applicable supplement, as that rate appears on the Designated EURIBOR Page, as of 11:00 a.m., Brussels time on such interest determination date.
The following procedures will be followed if EURIBOR cannot be determined as described above:
•
If no offered rate appears on the Designated EURIBOR Page on an interest determination date at approximately
11:00 a.m., Brussels time, then the calculation agent will request four major banks in the Eurozone interbank market selected and identified by us to provide a quotation of the rate at which deposits in euro having the index maturity specified in
the applicable supplement are offered to prime banks in the Eurozone interbank market, and in a principal amount not less than the equivalent of €1,000,000, that is representative of a single transaction in euro in that market at that time. If
at least two quotations are provided, EURIBOR will be the average of those quotations.
•
If fewer than two quotations are provided, then the calculation agent will request four major banks in the
Eurozone interbank market selected and identified by us to provide a quotation of the rate offered by them, at approximately 11:00 a.m., Brussels time, on the interest determination date, for loans in euro to prime banks in the Eurozone interbank
market for a period of time equivalent to the index maturity specified in the applicable supplement commencing on the reset date to which such interest determination date relates and in a principal amount not less than the equivalent of
€1,000,000, that is representative of a single transaction in euro in that market at that time. If at least three quotations are provided, EURIBOR will be the average of those quotations.
•
If three quotations are not provided, EURIBOR for that interest determination date will be equal to the most
recent rate that could have been determined in accordance with the first paragraph of this EURIBOR Notes section.
Notwithstanding the foregoing, if we or our designee, after consulting with us, determines that a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark Replacement Date have occurred prior to the applicable
Non-USD
Benchmark Reference Time in respect of any determination of EURIBOR on any date as described under “—Effect of a
Non-USD
Benchmark Transition Event and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA” below, then the
Non-USD
benchmark transition provisions set forth under such heading will
thereafter apply to all determinations of the interest rate payable on the relevant notes. In accordance with the
Non-USD
benchmark transition provisions, after a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark Replacement Date have occurred, the amount of interest that will be payable for each applicable interest
period will be determined by reference
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to a per annum rate equal to the
Non-USD
Benchmark Replacement plus or minus the spread, or multiplied by the spread multiplier, as may be specified in the
applicable supplement. Certain capitalized terms used in this paragraph have the meanings set forth under “—Effect of a
Non-USD
Benchmark Transition Event and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA.”
As used in the
foregoing terms and provisions relating to the determination of EURIBOR:
“Designated EURIBOR Page” means the display on the
page specified in the applicable supplement for the purpose of displaying EURIBOR; provided, however, that if no such page is specified in the applicable supplement, the display on Reuters on the EURIBOR01 page (or any other page as may replace such
page on such service) shall be used.
Federal Funds (Effective) Rate Notes
“Federal funds (effective) rate,” for any interest determination date, will be the rate for that date as displayed on the Reuters
Screen Page FEDFUNDS1 (or any successor service or any other page that replaces that page on that service) under the heading “EFFECT” on that date. With respect to any interest determination date, if such rate is not displayed on Reuters
Screen Page FEDFUNDS1 by 5:00 p.m., New York City time, on that date the federal funds (effective) rate for such interest determination date will be the federal funds (effective) rate for such interest determination date, as published on that date
in H.15 Daily Update under the heading “Federal Funds (Effective).” If such rate is not published in H.15 Daily Update by 5:00 p.m., New York City time, on that date, the federal funds (effective) rate for such interest determination
date will be the federal funds (effective) rate as published for the first preceding New York banking day for which the federal funds (effective) rate can be determined in accordance with the first sentence of this paragraph.
As used in the foregoing terms and provisions relating to the determination of the federal funds (effective) rate:
“H.15 Daily Update” means the Selected Interest Rates
(Daily)-H.15
release of the Board of
Governors of the Federal Reserve System (the “Federal Reserve”), available at www.federalreserve.gov/releases/h15/update, or any successor site or publication.
“New York banking day” means a day of the work week other than a holiday observed by the FRBNY.
Prime Rate Notes
The
“prime rate” for any interest determination date will be the prime rate or base lending rate on that date, as published in H.15 Daily Update by 5:00 p.m., New York City time, on the related calculation date, under the heading “Bank
prime loan” (or in another recognized electronic source determined by us or our designee (after consulting with us)).
The following
procedures will be followed if the prime rate cannot be determined as described above:
•
If the rate is not published in H.15 Daily Update by 5:00 p.m., New York City time, on the related calculation
date, then the prime rate will be the rate as published in any other recognized electronic source used for the purpose of displaying the applicable rate, under the caption “Bank prime loan” (or in another recognized electronic source
determined by us or our designee (after consulting with us)).
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•
If the alternative rate described above is not published in another recognized electronic source by 5:00 p.m.,
New York City time, on the related calculation date, then the calculation agent will determine the prime rate to be the arithmetic mean of the rates of interest publicly announced by each bank that appears on Reuters page USPRIME1, as defined below,
as that bank’s prime rate or base lending rate as in effect as of 11:00 a.m., New York City time, on that interest determination date.
•
If fewer than four rates appear on the Reuters page USPRIME1 for that interest determination date, by 5:00 p.m.,
New York City time, then the calculation agent will determine the prime rate to be the average of the prime rates or base lending rates furnished in New York City by three substitute banks or trust companies (all organized under the laws of the
United States or any of its states and having total equity capital of at least $500,000,000) selected by us.
•
If the banks selected by us are not quoting as described above, the prime rate will remain the prime rate then in
effect on the interest determination date.
As used in the foregoing terms and provisions relating to the determination
of the Federal funds (effective) rate:
“H.15 Daily Update” means the Selected Interest Rates
(Daily)-H.15
release of the Federal Reserve, available at www.federalreserve.gov/releases/h15/update, or any successor site or publication.
“Reuters page USPRIME1” means the display designated as page “USPRIME1” on Reuters for the purpose of displaying prime
rates or base lending rates of major U.S. banks.
Treasury (Auction) Rate Notes
The “treasury (auction) rate” for any interest determination date will be the rate from the auction held on such interest
determination date, of direct obligations of the United States, referred to as “Treasury bills,” having the index maturity specified in the applicable supplement, as such rate appears under the caption “INVEST RATE” on
Reuters (or any successor service) page USAUCTION10 or page USAUCTION11 (or any other page as may replace either such page on such service or as otherwise specified in the applicable supplement).
The following procedures will be followed in the order set forth below if the treasury (auction) rate cannot be determined as described above:
•
If the rate is not displayed on Reuters (or any successor service) by 5:00 p.m., New York City time, on the
related calculation date, the treasury (auction) rate will be the bond equivalent yield, as defined below, of the auction rate of the applicable Treasury bills as of the applicable interest determination date, as announced by the U.S. Department of
the Treasury.
•
If the alternative rate described in the bullet immediately above is not announced by the U.S. Department of the
Treasury, the treasury (auction) rate will be the bond equivalent yield of the rate on the particular interest determination date of the applicable Treasury bills as published in H.15 Daily Update, or another recognized electronic source (as
determined by us or our designee (after consulting with us)) used for the purpose of displaying the applicable rate, under the caption “U.S. government securities/Treasury bills/(secondary market).”
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•
If the alternative rate described in the bullet immediately above is not published by 5:00 p.m., New York City
time, on the related calculation date, the treasury (auction) rate will be the rate on the particular interest determination date calculated by the calculation agent as the bond equivalent yield of the arithmetic mean of the secondary market bid
rates, as of approximately 3:30 p.m., New York City time, on that interest determination date, of three primary U.S. government securities dealers, which may include our affiliates selected by us or our designee, after consultation with us, for the
issue of Treasury bills with a remaining maturity closest to the particular index maturity.
•
If the dealers selected by us or our designee are not quoting as described in the bullet immediately above, the
treasury (auction) rate will be the treasury (auction) rate in effect on the particular interest determination date.
The bond equivalent yield will be calculated using the following formula:
where “
D
” refers to the applicable annual rate for Treasury bills quoted on a bank
discount basis and expressed as a decimal, “
N
” refers to 365 or 366, as the case may be, and “
M
” refers to the actual number of days in the applicable interest period.
As used in the foregoing terms and provisions relating to the determination of the treasury (auction) rate:
“H.15 Daily Update” means the Selected Interest Rates
(Daily)-H.15
release of the Federal
Reserve, available at www.federalreserve.gov/releases/h15/update, or any successor site or publication.
Compounded SOFR Notes (Other
than Compounded SOFR Notes Using the Payment Delay Convention)
For a series of compounded SOFR notes not using the payment delay
convention, compounded SOFR will be determined in accordance with an “observation period convention,” a “rate
cut-off
convention” or a “SOFR Index convention” in accordance
with the terms and provisions applicable to such convention as set forth below. The applicable supplement relating to a series of compounded SOFR notes will specify whether the “observation period convention,” the “rate
cut-off
convention” or the “SOFR Index convention” applies to such compounded SOFR notes.
The calculation agent will determine compounded SOFR, the interest rate and accrued interest for each interest period in arrears as soon as
reasonably practicable on or after the last day of the applicable observation period, and in any event on or prior to the business day immediately preceding the relevant interest payment date, and will notify us of compounded SOFR and such interest
rate and accrued interest for each interest period as soon as reasonably practicable after such determination, but in any event by the business day immediately prior to the interest payment date.
With respect to a series of compounded SOFR notes using the “observation period convention,” the “rate
cut-off
convention” or the “SOFR Index convention,” the following terms will have the meanings set forth below:
“observation period” means, in respect of each interest period, the period from, and including, the date that is two U.S.
government securities business days (or such other number of U.S.
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government securities business days as we may specify in the applicable supplement) preceding the first date in such interest period to, but excluding, the date that is two U.S. government
securities business days (or such other number of U.S. government securities business days as we may specify in the applicable supplement) preceding the interest payment date for such interest period.
“SOFR” means, with respect to any U.S. government securities business day prior to a USD Benchmark Replacement Date:
(1)
the Secured Overnight Financing Rate published for such U.S. government securities business day as such rate
appears on the SOFR Administrator’s Website at 3:00 p.m., New York City time, on the immediately following U.S. government securities business day; or
(2)
if the rate specified in (1) above does not so appear, the Secured Overnight Financing Rate as published
in respect of the first preceding U.S. government securities business day for which the Secured Overnight Financing Rate was published on the SOFR Administrator’s Website.
Notwithstanding the foregoing, if we or our designee, after consulting with us, determines that a USD Benchmark Transition Event and related
USD Benchmark Replacement Date have occurred prior to the applicable USD Benchmark Reference Time in respect of any determination of SOFR on any date as described under “—Effect of a USD Benchmark Transition Event and Related USD
Benchmark Replacement Date with Respect to SOFR” below, then the USD benchmark transition provisions set forth under such heading will thereafter apply to all determinations of the interest rate payable on the relevant notes. In accordance
with the USD benchmark transition provisions, after a USD Benchmark Transition Event and related USD Benchmark Replacement Date have occurred, the amount of interest that will be payable for each applicable interest period will be determined by
reference to a per annum rate equal to the USD Benchmark Replacement plus or minus the spread, or multiplied by the spread multiplier, as may be specified in the applicable supplement. Certain capitalized terms used in this paragraph have the
meanings set forth under “—Effect of a USD Benchmark Transition Event and Related USD Benchmark Replacement Date with Respect to SOFR.”
“SOFR Administrator” means the FRBNY (or a successor administrator of the Secured Overnight Financing Rate).
“SOFR Administrator’s Website” means the website of the FRBNY, or any successor source. The information contained on such
website is not part of this prospectus supplement and is not incorporated in this prospectus supplement by reference.
Observation
Period Convention
If the applicable supplement for a series of compounded SOFR notes specifies that the “observation period
convention” applies, then “compounded SOFR” means, for each applicable interest period, a rate calculated in accordance with the formula set forth below with respect to the observation period relating to such interest period:
where:
“
d
0
”, for any observation period, is the number of U.S. government
securities business days in such observation period;
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“
i
”, for such observation period, is a series of whole numbers from one
to
d
0
, each representing the relevant U.S. government securities business days in chronological order from, and including, the first U.S. government securities business day in such
observation period;
“
SOFR
i
” for any U.S. government
securities business day “
i
” in such observation period, is equal to SOFR in respect of that day, determined by the calculation agent;
“
n
i
” for U.S. government securities business day
“
i
” in such observation period, is the number of calendar days from, and including, such U.S. government securities business day “
i
” to, but excluding, the following U.S. government securities business day; and
“
d
”, for such observation period, is the number of calendar days in such observation period.
Rate
Cut-Off
Convention
If the applicable supplement for a series of compounded SOFR notes specifies that the “rate
cut-off
convention” applies, then “compounded SOFR” means, for each applicable interest period, a rate calculated in accordance with the formula set forth below. For purposes of calculating
compounded SOFR in accordance with such formula with respect to any interest period for an applicable series of compounded SOFR notes, SOFR for each U.S. government securities business day in the period from, and including, the rate
cut-off
date to, but excluding, the interest payment date in respect of such interest period (or, in the case of the final interest period, the maturity date or redemption date, as applicable), will be SOFR in
respect of such rate
cut-off
date. With respect to each applicable interest period, the “rate
cut-off
date” will be the fifth U.S. government securities
business day (or such other number of U.S. government securities business days as we may specify in the applicable supplement) prior to the interest payment date in respect of such interest period (or, in the case of the final interest period, the
maturity date or redemption date, as applicable).
where:
“
d
0
”, for any interest period, is the number of U.S. government
securities business days in such interest period;
“
i
” is a series of whole numbers from one to
d
0
, each representing the relevant U.S. government securities business days in chronological order from, and including, the first U.S. government securities business day in such interest period;
“
SOFR
i
” for any U.S. government securities business day
“
i
” in such interest period, is equal to SOFR in respect of that day, determined by the calculation agent; provided that, for purposes of calculating compounded SOFR with respect to any interest period, SOFR for each U.S.
government securities business day in the period from, and including, the rate
cut-off
date to, but excluding, the interest payment date in respect of such interest period (or, in the case of the final
interest period, the maturity date or redemption date, as applicable), will be SOFR in respect of such rate
cut-off
date;
“n
i
” for U.S. government securities business day
“
i
” in such interest period, is the number of calendar days from, and including, such U.S. government securities business day “
i
” to, but excluding, the following U.S. government securities business day; and
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“
d
” is the number of calendar days in such interest period.
SOFR Index Convention
If the applicable supplement for a series of compounded SOFR notes specifies that the “SOFR Index convention” applies, then
“compounded SOFR ” means, for each applicable interest period, a rate calculated in accordance with the formula set forth below:
where:
“
SOFR Index
End
” is the SOFR Index value on the day which is
two U.S. government securities business days (or such other number of U.S. government securities business days as we may specify in the applicable supplement) (such date, the “SOFR Index End Date”) preceding the interest payment date
relating to such interest period;
“
SOFR Index
Start
” is
the SOFR Index value on the day which is two U.S. government securities business days (or such other number of U.S. government securities business days as we may specify in the applicable supplement) (such date, the “SOFR Index Start
Date”) preceding the first day of the relevant interest period;
“
d
” is the number of calendar days from (and
including) the SOFR Index Start Date to (but excluding) the SOFR Index End Date;
“SOFR” means the daily Secured Overnight
Financing Rate as provided by the SOFR Administrator on the SOFR Administrator’s Website; and
“SOFR Index,” with
respect to any U.S. Government Securities Business Day, means:
(1)
the SOFR Index value as published by the SOFR Administrator as such index appears on the SOFR
Administrator’s Website at 3:00 p.m., New York City time, on such U.S. government securities business day (the “SOFR Index Determination Time”); or
(2)
if a SOFR Index value specified in (1) above does not so appear at the SOFR Index Determination Time,
then:
(i)
if a USD Benchmark Transition Event and its related USD Benchmark Replacement Date have not occurred with
respect to SOFR, then compounded SOFR shall be the rate determined pursuant to the “SOFR Index Unavailability” provisions below; or
(ii)
if a USD Benchmark Transition Event and its related USD Benchmark Replacement Date have occurred with respect
to SOFR, then compounded SOFR shall be the rate determined in accordance with the terms and provisions set forth under “—Effect of a USD Benchmark Transition Event and Related USD Benchmark Replacement Date with Respect to SOFR”
below.
SOFR Index Unavailability Provisions
– If SOFR Index
Start
or SOFR Index
End
is not published or otherwise is not available on the relevant interest determination date and a USD Benchmark
Transition Event and its related USD Benchmark Replacement Date have not occurred with respect to SOFR, “compounded SOFR” will mean, for the applicable interest period for which such
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index is not available, the base rate calculated in accordance with the formula set forth above under “—Observation Period Convention” as if the applicable supplement had
specified “observation period convention” to be applicable to the notes, rather than “SOFR Index convention,” where “observation period” means, in respect of such interest period, the period from, and including,
the SOFR Index Start Date for such interest period to, but excluding, the SOFR Index End Date for such interest period.
Compounded
SONIA Notes (Other than Compounded SONIA Notes Using the Payment Delay Convention)
For a series of compounded SONIA notes not using
the payment delay convention, compounded SONIA will be determined in accordance with an “observation period convention,” “lookback convention” or “SONIA Compounded Index convention” in accordance with the terms
and provisions applicable to such convention as set forth below. The applicable supplement relating to a series of compounded SONIA notes will specify whether the “observation period convention,” “lookback convention” or
“SONIA Compounded Index convention” applies to such compounded SONIA notes.
The calculation agent will determine compounded
SONIA, the interest rate and accrued interest for each interest period in arrears as soon as reasonably practicable on or after (a) the last day of the applicable observation period (if “observation period convention” or
“SONIA Compounded Index convention” has been specified in the applicable supplement) or (b) the date falling “p” London banking days prior to the final London banking day in an applicable interest period (if
“lookback convention” has been specified in the applicable supplement), and in any event on or prior to the business day immediately preceding the relevant interest payment date, and will notify us of compounded SONIA and such interest
rate and accrued interest for each interest period as soon as reasonably practicable after such determination, but in any event by the business day immediately prior to the relevant interest payment date.
With respect to a series of compounded SONIA notes using the “observation period convention,” the “lookback
convention” or the “SONIA Compounded Index convention,” the following terms will have the meanings set forth below:
“observation period” means, in respect of each interest period, the period from, and including, the date that is five London
banking days (or such other number of London banking days as we may specify in the applicable supplement) preceding the first date in such interest period to, but excluding, the date that is five London banking days (or such other number of London
banking days as we may specify in the applicable supplement) preceding the interest payment date for such interest period; and
“SONIA” means, in relation to any London banking day, the daily Sterling Overnight Index Average rate for such London banking day
as provided by the administrator of SONIA to authorized distributors and as then published on the SONIA Screen Page or, if the SONIA Screen Page is unavailable, as otherwise published by such authorized distributors in each case at 12:00 p.m.,
London time, on the London banking day immediately following such London banking day; provided that if, in respect of any London banking day, the calculation agent determines that the SONIA rate is not available on the SONIA Screen Page or has not
otherwise been published by the relevant authorized distributors, such SONIA rate shall be:
(1)
(i) the BoE’s Bank Rate (the “Bank Rate”) prevailing at 5:00 p.m., London time (or, if
earlier, close of business) on the relevant London banking day; plus (ii) the mean of the spread of the SONIA rate to the Bank Rate over the previous five days on which a SONIA rate has been published, excluding the highest spread (or, if there
is more than one highest
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spread, one only of those highest spreads) and lowest spread (or, if there is more than one lowest spread, one only of those lowest spreads); or
(2)
if the Bank Rate is not published by the BoE at 5:00 p.m., London time (or, if earlier, close of business) on
the relevant London banking day, the SONIA rate published on the SONIA Screen Page (or otherwise published by the relevant authorized distributors) for the first preceding London banking day on which the SONIA rate was published on the SONIA Screen
Page (or otherwise published by the relevant authorized distributors).
Notwithstanding the foregoing, if we or our
designee, after consulting with us, determines that a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark Replacement Date have occurred prior to the
applicable
Non-USD
Benchmark Reference Time in respect of any determination of SONIA on any date as described under “—Effect of a
Non-USD
Benchmark
Transition Event and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA” below, then the
Non-USD
benchmark transition provisions set forth
under such heading will thereafter apply to all determinations of the interest rate payable on the relevant notes. In accordance with the
Non-USD
benchmark transition provisions, after a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark Replacement Date have occurred, the amount of interest that will be payable for each applicable interest
period will be determined by reference to a per annum rate equal to the
Non-USD
Benchmark Replacement plus or minus the spread, or multiplied by the spread multiplier, as may be specified in the applicable
supplement. Certain capitalized terms used in this paragraph have the meanings set forth under “—Effect of a
Non-USD
Benchmark Transition Event and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA.”
Notwithstanding the
foregoing provisions, in the event the BoE publishes guidance as to (i) how SONIA is to be determined or (ii) any rate of interest that is to replace the SONIA rate, the calculation agent shall, in consultation with us, follow such
guidance in order to determine the SONIA rate for so long as the SONIA rate is not available or has not been published by the authorized distributors.
“SONIA Screen Page” means Reuters Screen SONIA Page or such other page, section or other part as may replace it as may be
nominated by the person providing or sponsoring the information appearing there for the purpose of displaying rates or prices comparable to SONIA.
Observation Period Convention
If the applicable supplement for a series of compounded SONIA notes specifies that the “observation period convention” applies,
then “compounded SONIA” means, for each applicable interest period, a rate calculated in accordance with the formula set forth below with respect to the observation period relating to such interest period:
where:
“
d
0
”, for any observation period, is the number of London banking
days in such observation period;
“
i
”, for such observation period, is a series of whole numbers from one to
d
0
, each representing the relevant London banking days in chronological order from, and including, the first London banking day in such observation period;
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“
SONIA
i
”
means, in relation to any London banking day “
i
” in such observation period, SONIA in respect of that day, determined by the calculation agent;
“
n
i
” means, in relation to any London banking day
“
i
” in such observation period, the number of calendar days from, and including, such London banking day “
i
” to, but excluding, the next following London banking day; and
“
d
”, for such observation period, is the number of calendar days in such observation period.
Lookback Convention
If
the applicable supplement for a series of compounded SONIA notes specifies that the “lookback convention” applies, then “compounded SONIA” means, for each applicable interest period, a rate calculated in accordance with the
formula set forth below:
where:
“
d
0
”, for any interest period, is the number of London banking days
in such interest period;
“
i
”, for such interest period, is a series of whole numbers from one to
d
0
, each representing the relevant London banking days in chronological order from, and including, the first London banking day in such interest period;
“
SONIA
i-
p
LBD
” means, in relation to any London banking day “
i
” in such interest period, SONIA in respect of the London banking day falling “
p
” London
banking days prior to such London banking day “
i
”, determined by the calculation agent;
“
n
i
” means, in relation to any London banking day “
i
” in such interest period, the number of calendar days from, and including, such London banking day
“
i
” to, but excluding, the next following London banking day;
“
d
”, for such interest period, is the
number of calendar days in such interest period; and
“
p
” means the number of London banking days specified in the
applicable supplement (or, if no such number is specified, five London banking days).
SONIA Compounded Index Convention
If the applicable supplement for a series of compounded SONIA notes specifies that the “SONIA Compounded Index convention”
applies, then “compounded SONIA” means, for each applicable interest period, a rate calculated in accordance with the formula set forth below:
where:
“SONIA Compounded Index
End
” is the SONIA Compounded Index
value on the day which is five London banking days (or such other number of London banking days as we may specify in the
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applicable supplement) (such date, the “SONIA Compounded Index End Date”) preceding the interest payment date relating to such interest period;
“
SONIA Compounded Index
Start
” is the SONIA Compounded Index
value on the day which is five London banking days (or such other number of London banking days as we may specify in the applicable supplement) (such date, the “SONIA Compounded Index Start Date”) preceding the first day of the relevant
interest period; and
“
d
” is the number of calendar days from (and including) the SONIA Compounded Index Start Date to
(but excluding) the SONIA Compounded Index End Date.
“SONIA Compounded Index” means, with respect to any London banking day,
the SONIA Compounded Index value as published at 10:00 a.m., London time, by the BoE (or a successor administrator thereof), on the BoE’s Interactive Statistical Database, or any successor source, on such London banking day.
SONIA Compounded Index Unavailability Provisions
– If SONIA Compounded
Index
Start
or SONIA Compounded Index
End
is not published or displayed by the administrator of the SONIA Compounded Index or otherwise is
not available by 5:00 p.m., London time, on the relevant interest determination date, “compounded SONIA” will mean, for the applicable interest period for which such index is not available, the base rate calculated in accordance with the
formula set forth above under “—Observation Period Convention” as if the applicable supplement had specified “observation period convention” to be applicable to the notes, rather than “SONIA Compounded Index
convention,” where “observation period” means, in respect of such interest period, the period from, and including, the SONIA Compounded Index Start Date for such interest period to, but excluding, the SONIA Compounded Index End
Date for such interest period.
Compounded CORRA Notes (Other than Compounded CORRA Notes Using the Payment Delay Convention)
For a series of compounded CORRA notes not using the payment delay convention, compounded CORRA will be determined in accordance with an
“observation period convention” or a “CORRA Compounded Index convention” in accordance with the terms and provisions applicable to such convention as set forth below. The applicable supplement relating to a series of
compounded CORRA notes will specify whether the “observation period convention” or the “CORRA Compounded Index convention” applies to such compounded CORRA notes.
The calculation agent will determine compounded CORRA, the interest rate and accrued interest for each interest period in arrears as soon as
reasonably practicable on or after the last day of the applicable observation period, and in any event on or prior to the business day immediately preceding the relevant interest payment date, and will notify us of compounded CORRA and such interest
rate and accrued interest for each interest period as soon as reasonably practicable after such determination, but in any event by the business day immediately prior to the relevant interest payment date.
With respect to a series of compounded CORRA notes using the “observation period convention” or the “CORRA Compounded Index
convention,” the following terms will have the meanings set forth below:
“observation period” means, in respect of each
interest period, the period from, and including, the date that is two Toronto banking days (or such other number of Toronto banking days as we may specify in the applicable supplement) preceding the first date in such interest period to, but
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excluding, the date that is two Toronto banking days (or such other number of Toronto banking days as we may specify in the applicable supplement) preceding the interest payment date for such
interest period.
“CORRA” means, in respect of any Toronto banking day:
(1)
a reference rate equal to the daily Canada Overnight Repo Rate Average for such Toronto banking day as provided
by the Bank of Canada (or any successor administrator of such rate) as administrator of CORRA to authorized distributors and as then published on the Bank of Canada’s website, or any successor website designated by the Bank of Canada or any
successor administrator, at any time the Bank of Canada (or such successor administrator) is administrator of CORRA, or such other source or page as is specified in the applicable supplement or, if the Bank of Canada’s website or such other
source or page as is specified in the applicable supplement, as applicable, is unavailable, as otherwise published by such authorized distributors (in each case, at approximately 11:00 a.m., Toronto time (or such other time as is specified in the
applicable supplement), on the Toronto banking day immediately following such Toronto banking day); or
(2)
if, in respect of any applicable Toronto banking day, the calculation agent determines that CORRA is not
available in accordance with (1) above or has not otherwise been published by the relevant authorized distributors, the calculation agent will determine CORRA for such applicable Toronto banking day as being CORRA in respect of the most recent
Toronto banking day for which CORRA was published in accordance with (1) above or as otherwise published by the relevant authorized distributors.
Notwithstanding the foregoing, upon the occurrence of an Index Cessation Event with respect to CORRA or an Applicable Fallback Rate, the terms
and provisions set forth in (i) and (ii) below will apply, in the order set forth below, with respect to an applicable series of compounded CORRA notes. In addition, in connection with the implementation of an Applicable Fallback Rate, we or
our designee (after consulting with us) may make such changes or adjustments to (1) the Applicable Fallback Rate or the applicable fallback spread, (2) any observation period, interest payment date, other relevant date, business day
convention or interest period, (3) the manner, timing and frequency of determining rates and amounts of interest that are payable on the compounded CORRA notes and the conventions relating to such determination, (4) the timing and
frequency of making payments of interest, (5) rounding conventions, (6) tenors, and (7) any other terms or provisions of the relevant series of compounded CORRA notes and related definitions, in each case that we or our designee
(after consulting with us) determines, from time to time, and notifies to the calculation agent, are consistent with accepted market practice or applicable regulatory or legislative action or guidance for the use of such Applicable Fallback Rate for
debt obligations comparable to the relevant series of compounded CORRA notes in such circumstances.
(i)
Index Cessation Effective Date with respect to CORRA
. If an Index Cessation Effective Date occurs
with respect to CORRA, then the rate for an applicable interest period in respect of which any day of the related observation period occurs on or after the Index Cessation Effective Date with respect to CORRA will be the CAD Recommended Rate, to
which the calculation agent shall apply a spread (which may be positive or negative or zero) and make such adjustments to the CAD Recommended Rate as are necessary to account for any difference in term structure or tenor of the CAD Recommended Rate
by comparison to CORRA (if any), with such spread and adjustments (if any) being determined by us or our designee (after consulting with us). If there is a CAD Recommended Rate before the end of the first Toronto banking day following the Index
Cessation Effective Date with respect to CORRA but neither the administrator nor authorized distributors provide or publish the CAD Recommended Rate and an Index
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Cessation Effective Date with respect to it has not occurred, then, in respect of any day for which the CAD Recommended Rate is required, references to the CAD Recommended Rate will be deemed to
be references to the last provided or published CAD Recommended Rate.
(ii)
No CAD Recommended Rate or Index Cessation Effective Date with respect to CAD Recommended Rate
.
If there is no CAD Recommended Rate before the end of the first Toronto banking day following the Index Cessation Effective Date with respect to CORRA, or there is a CAD Recommended Rate and an Index Cessation Effective Date subsequently occurs with
respect to such CAD Recommended Rate, then the rate for an applicable interest period in respect of which any day of the related observation period occurs on or after the Index Cessation Effective Date with respect to CORRA or the Index Cessation
Effective Date with respect to the CAD Recommended Rate, as applicable, will be Bank of Canada’s Target for the overnight rate as set by the Bank of Canada and published on the Bank of Canada’s website (the “BOC Target
Rate”). If neither the administrator nor authorized distributors provide or publish the BOC Target Rate, then, in respect of any day for which the BOC Target Rate is required, references to the BOC Target Rate will be deemed to be references
to the last provided or published BOC Target Rate.
As used in the foregoing terms and provisions relating to the
determination of CORRA:
“Applicable Fallback Rate” means the CAD Recommended Rate, or the BOC Target Rate, as applicable;
“CAD Recommended Rate” means the rate (inclusive of any spreads or adjustments) recommended as the replacement for CORRA by a
committee officially endorsed or convened by the Bank of Canada for the purpose of recommending a replacement for CORRA (which rate may be produced by the Bank of Canada or another administrator) and as provided by the administrator of that rate or,
if that rate is not provided by the administrator thereof (or a successor administrator), published by an authorized distributor;
“Index Cessation Effective Date” means, in respect of an Index Cessation Event, the first date on which CORRA or the Applicable
Fallback Rate, as applicable, is no longer provided. If CORRA or the Applicable Fallback Rate, as applicable, ceases to be provided on the day that it is required to determine the rate for an interest period pursuant to the terms of an applicable
series of compounded CORRA notes but it was provided at the time at which it is to be observed pursuant to the terms and provisions of such series of compounded CORRA notes (or, if no such time is specified in the terms and provisions of such
series, at the time at which it is ordinarily published), then the Index Cessation Effective Date will be the next day on which the rate would ordinarily have been published;
“Index Cessation Event” means:
(A)
a public statement or publication of information by or on behalf of the administrator or provider of CORRA or
the Applicable Fallback Rate, as applicable, announcing that it has ceased or will cease to provide CORRA or the Applicable Fallback Rate, as applicable, permanently or indefinitely, provided that, at the time of the statement or publication, there
is no successor administrator or provider that will continue to provide CORRA or the Applicable Fallback Rate, as applicable; or
(B)
a public statement or publication of information by the regulatory supervisor for the administrator or provider
of CORRA or the Applicable Fallback Rate, as applicable, the Bank of Canada, an insolvency official with jurisdiction over the administrator or provider for CORRA or the Applicable Fallback Rate, as applicable, a resolution authority with
jurisdiction over the administrator or provider for CORRA or the Applicable Fallback Rate,
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as applicable, or a court or an entity with similar insolvency or resolution authority over the administrator or provider for CORRA or the Applicable Fallback Rate, as applicable, which states
that the administrator or provider of CORRA or the Applicable Fallback Rate, as applicable, has ceased or will cease to provide CORRA or the Applicable Fallback Rate, as applicable, permanently or indefinitely, provided that, at the time of the
statement or publication, there is no successor administrator or provider that will continue to provide CORRA or the Applicable Fallback Rate, as applicable.
Observation Period Convention
If the applicable supplement for a series of compounded CORRA notes specifies that the “observation period convention” applies,
then “compounded CORRA” means, for each applicable interest period, a rate calculated in accordance with the formula set forth below with respect to the observation period relating to such interest period:
where:
“
d
0
”, for any observation period, is the number of Toronto banking
days in such observation period;
“
i
”, for such observation period, is a series of whole numbers from one to
d
0
, each representing the relevant Toronto banking days in chronological order from, and including, the first Toronto banking day in such observation period;
“
CORRA
i
” means, in respect of any Toronto banking day
“
i
” in such observation period, CORRA in respect of that day, determined by the calculation agent;
“
n
i
” for Toronto banking day “
i
” in such observation period, is the number of calendar days from, and including, such Toronto banking day “
i
” to, but
excluding, the following Toronto banking day; and
“
d
”, for such observation period, is the number of calendar days in
such observation period.
CORRA Compounded Index Convention
If the applicable supplement for a series of compounded CORRA notes specifies that the “CORRA Compounded Index convention”
applies, then “compounded CORRA” means, for each applicable interest period, a rate calculated in accordance with the formula set forth below:
where:
“
CORRA Compounded Index
start
” is equal to the CORRA
Compounded Index value on the date that is two Toronto banking days (or such other number of Toronto banking days as we may specify
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in the applicable supplement) (such date, the “CORRA Compounded Index Start Date”) preceding the first date of an interest period;
“
CORRA Compounded Index
end
” is equal to the CORRA Compounded
Index value on the date that is two Toronto banking days (or such other number of Toronto banking days as we may specify in the applicable supplement) (such date, the “CORRA Compounded Index End Date”) preceding the interest payment date
relating to such interest period;
“
d
” is the number of calendar days from (and including) the CORRA Compounded Index
Start Date to (but excluding) the CORRA Compounded Index End Date; and
“CORRA Compounded Index” means the measure of the
cumulative impact of CORRA compounding over time administered by the Bank of Canada (or any successor administrator) and published on the website of the Bank of Canada (or any successor website).
CORRA Compounded Index Unavailability Provisions
– If (i) the CORRA Compounded Index
start
or the CORRA Compounded Index
end
is not published or displayed by the administrator or authorized distributor by 11:30 a.m., Toronto
time (or an amended publication time, if any, as specified in the administrator’s methodology for calculating the CORRA Compounded Index), on an applicable date but a CORRA Compounded Index Cessation Effective Date has not occurred or
(ii) a CORRA Compounded Index Cessation Effective Date has occurred, then “compounded CORRA” will mean, for the applicable interest period for which such index is not available, the base rate calculated in accordance with the
formula set forth above under “—Observation Period Convention,” as if the applicable supplement had specified “observation period convention” to be applicable to the notes, rather than “CORRA Compounded Index
convention,” where “observation period” means, in respect of such interest period, the period from, and including, the CORRA Compounded Index Start Date for such interest period to, but excluding, the CORRA Compounded Index End
Date for such interest period.
For purposes of the foregoing CORRA Compounded Index Unavailability Provisions, the following terms have
the meanings set forth below:
“CORRA Compounded Index Cessation Effective Date” means, in respect of one or more CORRA
Compounded Index Cessation Events, the first date on which the CORRA Compounded Index is no longer provided. If the CORRA Compounded Index ceases to be provided on the day on which it would have been observed to determine the base rate for an
interest period pursuant to the terms of an applicable series of compounded CORRA notes but it was provided at the time at which it is to be observed pursuant to the terms and provisions of such series of compounded CORRA notes (or, if no such time
is specified in the terms and provisions of such series, at the time at which it is ordinarily published), then the CORRA Compounded Index Cessation Effective Date will be the next day on which the rate would ordinarily have been published;
“CORRA Compounded Index Cessation Event” means:
(A)
a public statement or publication of information by or on behalf of the administrator or provider of the CORRA
Compounded Index announcing that it has ceased or will cease to provide the CORRA Compounded Index permanently or indefinitely, provided that, at the time of the statement or publication, there is no successor administrator or provider that will
continue to provide the CORRA Compounded Index; or
(B)
a public statement or publication of information by the regulatory supervisor for the administrator of the
CORRA Compounded Index (if applicable), the Bank of Canada, an insolvency official with jurisdiction over the administrator for the CORRA Compounded
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Index, a resolution authority with jurisdiction over the administrator for the CORRA Compounded Index, or a court or an entity with similar insolvency or resolution authority over the
administrator for the CORRA Compounded Index, which states that the administrator of the CORRA Compounded Index has ceased or will cease to provide the CORRA Compounded Index permanently or indefinitely, provided that, at the time of the statement
or publication, there is no successor administrator that will continue to provide the CORRA Compounded Index.
Compounded
AONIA Notes (Other than Compounded AONIA Notes Using the Payment Delay Convention)
For a series of compounded AONIA notes not using
the payment delay convention, compounded AONIA will be determined in accordance with an “observation period convention,” or “lookback convention” in accordance with the terms and provisions applicable to such convention as
set forth below. The applicable supplement relating to a series of compounded AONIA notes will specify whether the “observation period convention” or “lookback convention” applies to such compounded AONIA notes.
The calculation agent will determine compounded AONIA, the interest rate and accrued interest for each interest period in arrears as soon as
reasonably practicable on or after (a) the last day of the applicable observation period (if “observation period convention” has been specified in the applicable supplement) or (b) the date falling “p” Sydney
banking days prior to the final Sydney banking day in an applicable interest period (if “lookback convention” has been specified in the applicable supplement), and in any event on or prior to the business day immediately preceding the
relevant interest payment date, and will notify us of compounded AONIA and such interest rate and accrued interest for each interest period as soon as reasonably practicable after such determination, but in any event by the business day immediately
prior to the relevant interest payment date.
With respect to a series of compounded AONIA notes using the “observation period
convention” or the “lookback convention,” the following terms will have the meanings set forth below:
“observation period” means, in respect of each interest period, the period from, and including, the date that is five Sydney
banking days (or such other number of Sydney banking days as we may specify in the applicable supplement) preceding the first date in such interest period to, but excluding, the date that is five Sydney banking days (or such other number of Sydney
banking days as we may specify in the applicable supplement) preceding the interest payment date for such interest period; and
“AONIA” means,
in respect of any Sydney banking day:
(1)
a reference rate equal to the Australia dollar interbank overnight cash rate (AONIA) for such Sydney banking
day administered by the Reserve Bank of Australia (or any successor administrator of such rate) as provided by the Administrator to authorized distributors and as then published on the Refinitiv Screen RBA30 Page or on the Bloomberg Screen RBAO7
Page or on any successor screen page, or such other source or page as is specified in the applicable supplement or, if such screen page or such other source or page as is specified in the applicable supplement, as applicable, is unavailable, as
otherwise published by such authorized distributors (in each case, at approximately 4:00 p.m., Sydney time (or any amended publication time for the final intraday refix of such rate specified by the Administrator in its benchmark methodology) (or
such other time as is specified in the applicable supplement)), on the Sydney banking day immediately following such Sydney banking day; or
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(2)
if, in respect of any applicable Sydney banking day, (i) the calculation agent determines that AONIA is
not available in accordance with (1) above or has not otherwise been published by the relevant authorized distributors or (ii) we or our designee (after consulting with us determine that AONIA has been published or provided but there is an
obvious or proven error in such rate, the calculation agent will determine AONIA for such applicable Sydney banking day as being AONIA in respect of the most recent Sydney banking day for which AONIA was published in accordance with (1) above
or as otherwise published by the relevant authorized distributors.
Notwithstanding the foregoing, if a Permanent
Discontinuation Trigger has occurred with respect to AONIA, the terms and provisions set forth in (i) and (ii) below (such terms and provisions, the “AONIA Fallback Provisions”) will apply, in the order set forth below, with respect
to an applicable series of compounded AONIA notes. In addition, in connection with the implementation of an Applicable Fallback Rate, we or our designee (after consulting with us) may make such changes or adjustments to (1) the Applicable
Fallback Rate or the applicable fallback spread, (2) any observation period, interest payment date, other relevant date, business day convention or interest period, (3) the manner, timing and frequency of determining rates and amounts of
interest that are payable on the compounded AONIA notes and the conventions relating to such determination, (4) the timing and frequency of making payments of interest, (5) rounding conventions, (6) tenors, and (7) any other
terms or provisions of the relevant series of compounded AONIA notes and related definitions, in each case that we or our designee (after consulting with us) determines, from time to time, and notifies to the calculation agent, are consistent with
accepted market practice or applicable regulatory or legislative action or guidance for the use of such Applicable Fallback Rate for debt obligations comparable to the relevant series of compounded AONIA notes in such circumstances.
(i)
Permanent Discontinuation Trigger with respect to AONIA
. If a Permanent Discontinuation Trigger
has occurred with respect to AONIA, the rate for any day for which AONIA is required on or after the AONIA Permanent Fallback Effective Date will be the first rate available in the following order of precedence:
(A)
if at the time of the AONIA Permanent Fallback Effective Date, an RBA Recommended Rate has been created but no
RBA Recommended Rate Permanent Fallback Effective Date has occurred, the RBA Recommended Rate; and
(B)
if paragraph (A) above does not apply, the Final Fallback Rate; and
(ii)
Permanent Discontinuation Trigger with respect to RBA Recommended Rate.
Where a determination of
the RBA Recommended Rate is required for the purposes of paragraph (i) above, if a Permanent Discontinuation Trigger has occurred with respect to the RBA Recommended Rate, the rate for any day for which the RBA Recommended Rate is required on
or after that Permanent Fallback Effective Date will be the Final Fallback Rate.
When calculating an amount of interest
in circumstances where an Applicable Fallback Rate other than the Final Fallback Rate applies, that interest will be calculated as if references to AONIA were references to such Applicable Fallback Rate. When calculating interest in circumstances
where the Final Fallback Rate applies, the amount of interest will be calculated on the same basis as if the Applicable Benchmark Rate in effect immediately prior to the application of that Final Fallback Rate remained in effect but with necessary
adjustments to substitute all references to that Applicable Benchmark Rate with corresponding references to the Final Fallback Rate.
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As used in the foregoing terms and provisions relating to the determination of AONIA:
“Administrator” means:
(A)
in respect of AONIA, the Reserve Bank of Australia; and
(B)
in respect of any other Applicable Benchmark Rate, the administrator for that rate or benchmark or, if there is
no administrator, the provider of that rate or benchmark,
and, in each case, any successor administrator or, as applicable, any
successor administrator or provider.
“Applicable Benchmark Rate” means, initially, AONIA; provided that if a Permanent
Fallback Effective Date has occurred with respect to AONIA or the then-current Applicable Benchmark Rate, then the Applicable Fallback Rate.
“Applicable Fallback Rate” means, where a Permanent Discontinuation Trigger for an Applicable Benchmark Rate has occurred, the
rate that applies to replace that Applicable Benchmark Rate in accordance with the AONIA Fallback Provisions;
“Final Fallback
Rate” means, in respect of an Applicable Benchmark Rate, the rate:
(A)
determined by us or our designee (after consulting with us) as a commercially reasonable alternative for the
Applicable Benchmark Rate taking into account all available information that, in good faith, we or our designee (after consulting with us) considers relevant, provided that any rate (inclusive of any spreads or adjustments) implemented by central
counterparties and/or futures exchanges with representative trade volumes in derivatives or futures referencing the Applicable Benchmark Rate will be deemed to be acceptable for the purposes of this paragraph (A), together with (without double
counting) such spread adjustment (which may be a positive or negative value or zero) that is customarily applied to the relevant successor rate or alternative rate (as the case may be) in international debt capital markets transactions to produce an
industry-accepted replacement rate for AONIA-linked floating rate notes at such time, or, if no such industry standard is recognized or acknowledged, the spread adjustment determined in accordance with a method for calculating or determining such
spread adjustment determined by us or our designee (after consulting with us) to be appropriate; provided that
(B)
if and for so long as no such successor rate or alternative rate can be determined in accordance with paragraph
(A), the Final Fallback Rate will be the last provided or published level of that Applicable Benchmark Rate.
“Non-Representative”
means, in respect of an Applicable Benchmark Rate, that the Administrator of the Applicable Benchmark Rate:
(A)
has determined that such Applicable Benchmark Rate is no longer, or as of a specified future date will no
longer be, representative of the underlying market and economic reality that such Applicable Benchmark Rate is intended to measure and that representativeness will not be restored; and
(B)
is aware that such determination will engage certain contractual triggers for fallbacks activated by
pre-cessation
announcements by such Supervisor (howsoever described) in contracts;
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“Permanent Discontinuation Trigger” means, in respect of an Applicable Benchmark
Rate:
(A)
a public statement or publication of information by or on behalf of the Administrator of the Applicable
Benchmark Rate announcing that it has ceased or that it will cease to provide the Applicable Benchmark Rate permanently or indefinitely, provided that, at the time of the statement or publication, there is no successor administrator or provider, as
applicable, that will continue to provide the Applicable Benchmark Rate;
(B)
a public statement or publication of information by the Supervisor of the Applicable Benchmark Rate, the
Reserve Bank of Australia (or any successor central bank for Australian dollars), an insolvency official or resolution authority with jurisdiction over the Administrator of the Applicable Benchmark Rate or a court or an entity with similar
insolvency or resolution authority over the Administrator of the Applicable Benchmark Rate which states that the Administrator of the Applicable Benchmark Rate has ceased or will cease to provide the Applicable Benchmark Rate permanently or
indefinitely, provided that, at the time of the statement or publication, there is no successor administrator or provider that will continue to provide the Applicable Benchmark Rate;
(C)
a public statement by the Administrator of the Applicable Benchmark Rate if the Applicable Benchmark Rate is
AONIA or the RBA Recommended Rate, as a consequence of which the Applicable Benchmark Rate will be prohibited from being used either generally, or in respect of applicable series of compounded AONIA notes, or that its use will be subject to
restrictions or adverse consequences to us or a holder of the applicable series of compounded AONIA notes;
(D)
as a consequence of a change in law or directive arising after the original issue date of an applicable series
of compounded AONIA notes, it has become unlawful for the applicable calculation agent, us or any other party responsible for calculations of interest under the terms and provisions of the applicable series of compounded AONIA notes to calculate any
payments due to be made using the Applicable Benchmark Rate;
(E)
a public statement or publication of information by the Administrator of the Applicable Benchmark Rate if the
Applicable Benchmark Rate is AONIA or the RBA Recommended Rate, stating that the Applicable Benchmark Rate is
Non-Representative;
or
(F)
the Applicable Benchmark Rate has otherwise ceased to exist or be administered on a permanent or indefinite
basis.
“Permanent Fallback Effective Date” means, in respect of a Permanent Discontinuation Trigger for an
Applicable Benchmark Rate:
(A)
in the case of paragraphs (a) and (b) of the definition of “Permanent Discontinuation
Trigger,” the first date on which the Applicable Benchmark Rate would ordinarily have been published or provided and is no longer published or provided;
(B)
in the case of paragraphs (c) and (d) of the definition of “Permanent Discontinuation
Trigger,” the date from which use of the Applicable Benchmark Rate is prohibited or becomes subject to restrictions or adverse consequences or the calculation becomes unlawful, as applicable;
(C)
in the case of paragraph (e) of the definition of “Permanent Discontinuation Trigger,” the
first date on which the Applicable Benchmark Rate would ordinarily have been published or provided but is
Non-Representative
by reference to the most recent statement or publication contemplated in that
paragraph and even if such Applicable Benchmark Rate continues to be published or provided on such date; or
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(D)
in the case of paragraph (f) of the definition of “Permanent Discontinuation Trigger,” the
date that event occurs.
“RBA Recommended Rate” means, in respect of any relevant day (including any day
“
i
”), the rate (inclusive of any spreads or adjustments) recommended as the replacement for AONIA by the Reserve Bank of Australia (which rate may be produced by the Reserve Bank of Australia or another administrator) and as
provided by the Administrator of that rate or, if that rate is not provided by the Administrator thereof, published by an authorized distributor in respect of that day.
“Supervisor” means, in respect of an Applicable Benchmark Rate, the supervisor or competent authority that is responsible for
supervising that Applicable Benchmark Rate or the Administrator of that Applicable Benchmark Rate, or any committee officially endorsed or convened by any such supervisor or competent authority that is responsible for supervising that Applicable
Benchmark Rate or the Administrator of that Applicable Benchmark Rate.
“Sydney banking day”
means any day on which
commercial banks are open for general business in Sydney.
Observation Period Convention
If the applicable supplement for a series of compounded AONIA notes specifies that the “observation period convention” applies,
then “compounded AONIA” means, for each applicable interest period, a rate calculated in accordance with the formula set forth below with respect to the observation period relating to such interest period:
where:
“
d
0
”, for any observation period, is the number of Sydney banking
days in such observation period;
“
i
”, for such observation period, is a series of whole numbers from one to
d
0
, each representing the relevant Sydney banking days in chronological order from, and including, the first Sydney banking day in such observation period;
“
AONIA
i
” means, in relation to any Sydney banking day
“
i
” in such observation period, AONIA in respect of that day, determined by the calculation agent;
“
n
i
” means, in relation to any Sydney banking day “
i
” in such observation period, the number of calendar days from, and including, such Sydney banking day
“
i
” to, but excluding, the next following Sydney banking day; and
“
d
”, for such observation period,
is the number of calendar days in such observation period.
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Lookback Convention
If the applicable supplement for a series of compounded AONIA notes specifies that the “lookback convention” applies, then
“compounded AONIA” means, for each applicable interest period, a rate calculated in accordance with the formula set forth below:
where:
“
d
0
”, for any interest period, is the number of Sydney banking days
in such interest period;
“
i
”, for such interest period, is a series of whole numbers from one to
d
0
, each representing the relevant Sydney banking days in chronological order from, and including, the first Sydney banking day in such interest period;
“AONIA
i-
p
SBD
” means, in relation to any Sydney banking day “
i
” in such interest period, the per annum rate expressed as a decimal which is the level of AONIA in respect of the
Sydney banking day falling “
p
” Sydney banking days prior to such London banking day “
i
”, determined by the calculation agent;
“n
i
” means, in relation to any Sydney banking day
“
i
” in such interest period, the number of calendar days from, and including, such Sydney banking day “
i
” to, but excluding, the next following Sydney banking day;
“
d
”, for such interest period, is the number of calendar days in such interest period; and
“
p
” means the number of Sydney banking days specified in the applicable supplement (or, if no such number is specified,
five Sydney banking days).
Simple Average SOFR Notes
“Simple average SOFR” means, for each applicable interest period, a rate equal to the sum of the daily base rate for each calendar
day in such interest period divided by the number of calendar days in such interest period, calculated in accordance with the terms and provisions set forth below.
Subject to the provisions below relating to a “rate lookback” or “rate
cut-off
date,” as applicable, the “daily base rate” with respect to each calendar day in a relevant interest period will be SOFR in respect of such day; provided that for any calendar day in an interest period that is not a U.S. government
securities business day, SOFR in respect of such calendar day will be SOFR published for the U.S. government securities business day immediately preceding such calendar day.
If the applicable supplement specifies that a “rate lookback” applies, then, notwithstanding the terms and provisions set forth in
the preceding paragraph: (i) the “daily base rate” with respect to each U.S. government securities business day in a relevant interest period will be SOFR in respect of the U.S. government securities business day falling two U.S.
government securities business days (or such other number of U.S. government securities business days as may be specified in the applicable supplement) prior to such U.S. government securities business day (such number of days, the “lookback
period”); and (ii) the “daily base rate” with respect to each calendar day in a relevant interest period that is not a U.S. government securities business day will be equal to the daily base rate in effect for the immediately
preceding U.S. government securities business day.
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If the applicable supplement specifies that a “rate
cut-off
date” applies then, notwithstanding the terms and provisions set forth in the second preceding paragraph, for each calendar day in an interest period falling after the rate
cut-off
date for such interest period, the “daily base rate” for each such calendar day will be SOFR published for such rate
cut-off
date; provided that if such
applicable supplement specifies that both “rate lookback” and “rate
cut-off
date” are applicable, then the “daily base rate” for each calendar day in an applicable interest
period falling after such rate
cut-off
date will be equal to the daily base rate in effect for such rate
cut-off
date, determined in accordance with the provisions
relating to “rate lookback” in the preceding paragraph. Unless we specify otherwise in the applicable supplement, the “rate
cut-off
date” for an interest period, if applicable, will be
the second U.S. government securities business day (or such other number of U.S. government securities business days as we may specify in the applicable supplement) prior to the interest payment date for such interest period.
The calculation agent will determine simple average SOFR, the interest rate and accrued interest for each interest period in arrears as soon
as reasonably practicable prior to the relevant interest payment date and will notify us of simple average SOFR and such interest rate and accrued interest for each interest period as soon as reasonably practicable after such determination, but in
any event by the business day immediately prior to the interest payment date.
For purposes of the foregoing terms and provisions, the
following terms have the meanings set forth below:
“SOFR” means, with respect to any U.S. government securities business day
prior to a Benchmark Replacement Date:
(1)
the Secured Overnight Financing Rate published for such U.S. government securities business day as such rate
appears on the SOFR Administrator’s Website at 3:00 p.m. (New York City time) on the immediately following U.S. government securities business day; or
(2)
if the rate specified in (1) above does not so appear, the Secured Overnight Financing Rate as published
in respect of the first preceding U.S. government securities business day for which the Secured Overnight Financing Rate was published on the SOFR Administrator’s Website.
Notwithstanding the foregoing, if we or our designee, after consulting with us, determines that a USD Benchmark Transition Event and related
USD Benchmark Replacement Date have occurred prior to the applicable USD Benchmark Reference Time in respect of any determination of SOFR on any date as described under “—Effect of a USD Benchmark Transition Event and Related USD
Benchmark Replacement Date with Respect to SOFR” below, then the USD benchmark transition provisions set forth under such heading will thereafter apply to all determinations of the interest rate payable on the relevant notes. In accordance
with the USD benchmark transition provisions, after a USD Benchmark Transition Event and related USD Benchmark Replacement Date have occurred, the amount of interest that will be payable for each applicable interest period will be determined by
reference to a per annum rate equal to the USD Benchmark Replacement plus or minus the spread, or multiplied by the spread multiplier, as may be specified in the applicable supplement. Certain capitalized terms used in this paragraph have the
meanings set forth under “—Effect of a USD Benchmark Transition Event and Related USD Benchmark Replacement Date with Respect to SOFR.”
“SOFR Administrator” means the FRBNY (or a successor administrator of the Secured Overnight Financing Rate).
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“SOFR Administrator’s Website” means the website of the FRBNY, or any
successor source. The information contained on such website is not part of this prospectus supplement and is not incorporated in this prospectus supplement by reference.
Calculation of Interest Amounts for Floating-Rate Notes
The amount of accrued interest on a floating-rate note for an interest period is calculated by multiplying the principal amount of such note
by an accrued interest factor. This accrued interest factor will be determined by multiplying the per annum floating interest rate determined by reference to the applicable base rate, as determined for the applicable interest period, by a factor
resulting from the day count convention that applies with respect to such determination. The factor resulting from the day count convention will be, if so specified in the applicable supplement, one of the following, or may be any other convention
set forth in the applicable supplement:
•
a factor based on a
360-day
year of twelve
30-day
months if the day count convention specified in the applicable supplement is “30/360”;
•
a factor equal to the actual number of days in the relevant interest period divided by 360 if the day count
convention specified in the applicable supplement is “Actual/360”;
•
a factor equal to the actual number of days in the relevant interest period divided by 365, or if any portion of
that relevant period falls in a leap year, the sum of (A) the actual number of days in that portion of the relevant period falling in a leap year divided by 366 and (B) the actual number of days in that portion of the relevant period
falling in a
non-leap
year divided by 365, if the day count convention specified in the applicable supplement is “Actual/Actual”; or
•
a factor equal to the actual number of days in the relevant interest period divided by 365, if the day count
convention specified in the applicable supplement is “Actual/365 (Fixed).”
If no day count convention is
specified in the applicable supplement, the accrued interest factor will be as follows:
•
for BBSW notes, compounded CORRA notes or compounded AONIA notes, the factor will be equal to the actual number
of days in the relevant period divided by 365;
•
for treasury (auction) rate notes and compounded SONIA notes, the factor will be equal to the actual number of
days in the relevant period divided by 365 (or, if any portion of such relevant period falls in a leap year, the sum of (a) the actual number of days in that portion of such relevant period falling in a leap year, divided by 366 and
(b) the actual number of days in that portion of such relevant period falling in a
non-leap
year, divided by 365); and
•
for EURIBOR notes, federal funds (effective) rate notes, prime rate notes, compounded SOFR notes and simple
average SOFR notes and any other floating-rate notes other than the types of notes specified in this bulleted list, the factor will be equal to the actual number of days in the relevant period divided by 360.
On or before the relevant “calculation date,” the calculation agent will calculate the amount of interest that has accrued during
each interest period in accordance with the provisions set forth above. For any series of notes for which the specified base rate is an In Arrears Base Rate, the calculation date pertaining to an applicable interest payment date will be the business
day immediately preceding such interest payment date (including, if applicable, the maturity date or the date of earlier redemption or prepayment, as the case may be). For any series of notes for which
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the specified base rate is an In Advance Base Rate, the calculation date pertaining to an interest payment date will be the earlier of:
•
the tenth calendar day after the applicable interest determination date for the interest period to which such
interest payment date relates or, if that day is not a business day, the next succeeding business day; or
•
the business day immediately preceding such interest payment date, the maturity date, or the date of redemption
or prepayment, as the case may be.
All amounts resulting from any calculation on floating-rate notes will be rounded to
the nearest cent, in the case of U.S. dollars, or to the nearest corresponding hundredth of a unit, in the case of a currency other than U.S. dollars, with
one-half
cent or
one-half
of a corresponding hundredth of a unit or more being rounded upward. All percentages resulting from any calculation with respect to a floating-rate note will be rounded, if necessary, to the nearest
one hundred-thousandth of a percent, with five
one-millionths
of a percentage point rounded upwards, e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655).
The interest rate on a note may not be higher than the maximum rate permitted by New York law, as that rate may be modified by U.S. law of
general application. Under current New York law, the maximum rate of interest, subject to some exceptions, for any loan in an amount less than $250,000 is 16% and for any loan in the amount of $250,000 or more but less than $2,500,000 is 25% per
annum on a simple interest basis. These limits do not apply to loans of $2,500,000 or more to any one borrower.
At the request of a
holder of any BBSW note, EURIBOR note, federal funds (effective) rate note, prime rate note or treasury (auction) rate note, the calculation agent will provide the interest rate then in effect for that floating-rate note and, if already determined,
the interest rate that is to take effect on the next interest reset date.
At the request of a holder of any compounded SOFR note,
compounded SONIA note, compounded CORRA note, compounded AONIA note or simple average SOFR note, the calculation agent will provide compounded SOFR, compounded SONIA, compounded CORRA, compounded AONIA or simple average SOFR, as applicable, the
interest rate and the amount of interest accrued with respect to any interest period for such note, after compounded SOFR, compounded SONIA, compounded CORRA, compounded AONIA or simple average SOFR, as applicable, and such interest rate and accrued
interest have been determined.
Effect of a USD Benchmark Transition Event and Related USD Benchmark Replacement Date with Respect
to SOFR
Unless we specify otherwise in the applicable supplement, the provisions set forth in this section
“—Effect of a USD Benchmark Transition Event and Related USD Benchmark Replacement Date with Respect to SOFR,” which we refer to as the “USD benchmark transition provisions,” will apply to all compounded SOFR notes and
simple average SOFR notes. References to “notes” in this section are to such notes.
USD Benchmark Replacement
. If
we or our designee (after consulting with us) determines on or prior to the relevant USD Benchmark Reference Time that a USD Benchmark Transition Event and related USD Benchmark Replacement Date have occurred with respect to the then-current USD
Benchmark for any series of notes, the applicable USD Benchmark Replacement will replace the then-current USD Benchmark for such series of notes for all purposes relating to the relevant notes in respect of all determinations on such date and for
all determinations on all subsequent dates.
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USD Benchmark Replacement Conforming Changes
. In connection with the implementation
of a USD Benchmark Replacement, we or our designee (after consulting with us) will have the right to make USD Benchmark Replacement Conforming Changes from time to time.
Certain Defined Terms
. As used in this prospectus supplement with respect to any USD Benchmark Transition Event and implementation of
the applicable USD Benchmark Replacement and USD Benchmark Replacement Conforming Changes:
“ISDA Definitions” means the 2006
ISDA Definitions published by the International Swaps and Derivatives Association, Inc. or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time
to time.
“ISDA Fallback Adjustment” means the spread adjustment (which may be a positive or negative value or zero) that
would apply for derivatives transactions referencing the ISDA Definitions to be determined upon the occurrence of an index cessation event with respect to the USD Benchmark.
“ISDA Fallback Rate” means the rate that would apply for derivatives transactions referencing the ISDA Definitions to be effective
upon the occurrence of an index cessation date with respect to the USD Benchmark excluding the applicable ISDA Fallback Adjustment.
“USD Benchmark” means, initially, with respect to compounded SOFR notes and simple average SOFR notes, SOFR; provided, in each
case, that if a USD Benchmark Transition Event and related USD Benchmark Replacement Date have occurred with respect to SOFR or the then-current USD Benchmark, then “USD Benchmark” means the applicable USD Benchmark Replacement.
“USD Benchmark Replacement” means with respect to compounded SOFR notes and simple average SOFR notes, the first alternative set
forth in the order below that can be determined by us or our designee, after consulting with us, as of the USD Benchmark Replacement Date:
(1)
the sum of: (a) the alternate rate of interest that has been selected or recommended by the USD Relevant
Governmental Body as the replacement for the then-current USD Benchmark and (b) the USD Benchmark Replacement Adjustment;
(2)
the sum of: (a) the ISDA Fallback Rate and (b) the USD Benchmark Replacement Adjustment;
(3)
the sum of: (a) the alternate rate of interest that has been selected by us or our designee (after
consulting with us) as the replacement for the then-current USD Benchmark giving due consideration to any industry-accepted rate of interest as a replacement for the then-current USD Benchmark for U.S. dollar-denominated floating-rate notes at such
time and (b) the USD Benchmark Replacement Adjustment.
“USD Benchmark Replacement Adjustment” means
the first alternative set forth in the order below that can be determined by us or our designee (after consulting with us) as of the USD Benchmark Replacement Date:
(1)
the spread adjustment (which may be a positive or negative value or zero) that has been selected or recommended
by the USD Relevant Governmental Body or determined by us or our designee (after consulting with us) in accordance with the method for calculating or determining such spread adjustment that has been selected or recommended by the USD Relevant
Governmental Body, in each case for the applicable Unadjusted USD Benchmark Replacement;
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(2)
if the applicable Unadjusted USD Benchmark Replacement is equivalent to the ISDA Fallback Rate, then the ISDA
Fallback Adjustment;
(3)
the spread adjustment (which may be a positive or negative value or zero) that has been selected by us or our
designee (after consulting with us) giving due consideration to any industry-accepted spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the then-current USD Benchmark with the applicable USD
Unadjusted Benchmark Replacement for U.S. dollar-denominated floating-rate notes at such time.
“USD Benchmark
Replacement Conforming Changes” means, with respect to any USD Benchmark Replacement, changes to (1) any interest determination date, interest payment date, interest period demarcation date, interest reset date, business day convention or
interest period, (2) the manner, timing and frequency of determining rates and amounts of interest that are payable on the relevant notes and the conventions relating to such determination, (3) the timing and frequency of making payments
of interest, (4) rounding conventions, (5) tenors, (6) any other terms or provisions of the relevant series of notes, in each case that we or our designee (after consulting with us) determines, from time to time, to be appropriate to
reflect the determination and implementation of such USD Benchmark Replacement in a manner substantially consistent with market practice (or, if we or the calculation agent or our other designee (after consulting with us) decides that implementation
of any portion of such market practice is not administratively feasible or if we or our designee (after consulting with us) determines that no market practice for use of the USD Benchmark Replacement exists, in such other manner as we or our
designee (after consulting with us) determines is appropriate).
“USD Benchmark Replacement Date” means the earliest to occur
of the following events with respect to the then-current USD Benchmark:
(1)
in the case of clause (1) or (2) of the definition of “USD Benchmark Transition Event,” the
later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of the USD Benchmark permanently or indefinitely ceases to provide such USD Benchmark; or
(2)
in the case of clause (3) of the definition of “USD Benchmark Transition Event,” the date of
the public statement or publication of information referenced therein.
For the avoidance of doubt, if the event giving rise to the USD
Benchmark Replacement Date occurs on the same day as, but earlier than, the USD Benchmark Reference Time in respect of any determination, the USD Benchmark Replacement Date will be deemed to have occurred prior to the USD Benchmark Reference Time
for such determination.
“USD Benchmark Transition Event” means the occurrence of one or more of the following events with
respect to the then-current USD Benchmark:
(1)
a public statement or publication of information by or on behalf of the administrator of the USD Benchmark
announcing that such administrator has ceased or will cease to provide the USD Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the
USD Benchmark;
(2)
a public statement or publication of information by the regulatory supervisor for the administrator of the USD
Benchmark, the central bank for the currency of the USD Benchmark, an insolvency official with jurisdiction over the administrator for the USD
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Benchmark, a resolution authority with jurisdiction over the administrator for the USD Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for
the USD Benchmark, which states that the administrator of the USD Benchmark has ceased or will cease to provide the USD Benchmark permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor
administrator that will continue to provide the USD Benchmark; or
(3)
a public statement or publication of information by the regulatory supervisor for the administrator of the USD
Benchmark announcing that the USD Benchmark is no longer representative.
“USD Benchmark Reference Time”
with respect to any determination of the USD Benchmark means (1) with respect to compounded SOFR notes and simple average SOFR notes, if the USD Benchmark is SOFR, 3:00 p.m., New York City time, on the date of such determination, and
(2) otherwise, the time determined by us or our designee (after consulting with us) in accordance with the USD Benchmark Replacement Conforming Changes.
“USD Relevant Governmental Body” means the Federal Reserve and/or the FRBNY, or a committee officially endorsed or convened by the
Federal Reserve and/or the FRBNY or any successor thereto.
“Unadjusted USD Benchmark Replacement” means the USD Benchmark
Replacement excluding the USD Benchmark Replacement Adjustment.
Effect of a
Non-USD
Benchmark Transition Event and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA
Unless we specify otherwise in the applicable supplement, the provisions set forth in this section “—Effect of a
Non-USD
Benchmark Transition Event and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA,” which we refer to as the
“Non-USD
benchmark transition provisions,” will apply to all EURIBOR notes and compounded SONIA notes. References to “notes” in this section are to such notes.
Non-USD
Benchmark Replacement
. If we or our designee (after consulting with us) determines on
or prior to the relevant
Non-USD
Benchmark Reference Time that a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark
Replacement Date have occurred with respect to the then-current
Non-USD
Benchmark for any series of notes, the applicable
Non-USD
Benchmark Replacement will replace the
then-current
Non-USD
Benchmark for such series of notes for all purposes relating to the relevant notes in respect of all determinations on such date and for all determinations on all subsequent dates.
Non-USD
Benchmark Replacement Conforming Changes
. In connection with the implementation of a
Non-USD
Benchmark Replacement, we or our designee (after consulting with us) will have the right to make
Non-USD
Benchmark Replacement Conforming Changes from time to time.
Certain Defined Terms
. As used in this prospectus supplement with respect to any
Non-USD
Benchmark Transition Event and implementation of the applicable
Non-USD
Benchmark Replacement and
Non-USD
Benchmark Replacement Conforming Changes:
“Non-USD
Benchmark” means, initially, (i) with respect to EURIBOR notes, EURIBOR for
the index maturity indicated in the applicable supplement and (ii) with respect to compounded SONIA
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notes, SONIA; provided, in each case, that if a
Non-USD
Benchmark Transition Event and related
Non-USD
Benchmark
Replacement Date have occurred with respect to such initial
Non-USD
Benchmark, as applicable, or the then-current
Non-USD
Benchmark, then
“Non-USD
Benchmark” means the applicable
Non-USD
Benchmark Replacement.
“Non-USD
Benchmark Replacement” means, where the then-current
Non-USD
Benchmark is EURIBOR or another forward-looking term rate for which multiple tenors are published by the applicable administrator, the
Non-USD
Interpolated Benchmark,
if applicable, with respect to the then-current
Non-USD
Benchmark, plus the
Non-USD
Benchmark Replacement Adjustment for such
Non-USD
Benchmark, if applicable; provided that if the calculation agent cannot determine the
Non-USD
Interpolated Benchmark as of the
Non-USD
Benchmark Replacement Date, or if the then-current
Non-USD
Benchmark is not EURIBOR or another forward-looking term rate for which multiple tenors are published
by the applicable administrator, then
“Non-USD
Benchmark Replacement” means the first alternative set forth in the order below that can be determined by us or our designee, after consulting with
us, as of the
Non-USD
Benchmark Replacement Date:
(1)
the sum of: (a) the alternate rate of interest that has been selected or recommended by the
Non-USD
Relevant Governmental Body or identified through any other applicable regulatory or legislative action or guidance as the replacement for the then-current
Non-USD
Benchmark for the applicable
Non-USD
Corresponding Tenor (if any) and (b) the
Non-USD
Benchmark Replacement Adjustment;
(2)
the sum of: (a) the alternate rate of interest that has been selected by us or our designee (after
consulting with us) as the replacement for the then-current
Non-USD
Benchmark for the applicable
Non-USD
Corresponding Tenor giving due consideration to any
industry-accepted rate of interest as a replacement for the then-current
Non-USD
Benchmark for floating-rate notes denominated in the specified currency at such time and (b) the
Non-USD
Benchmark Replacement Adjustment;
provided that, if we or our designee (after consulting with
us) determines that there is no such alternate rate of interest as of the applicable
Non-USD
Benchmark Replacement Date, then the
Non-USD
Benchmark will be the most
recent rate that could have been determined for such
Non-USD
Benchmark in accordance with (i) the terms and provisions for determining such
Non-USD
Benchmark in the
section “—Payment Delay Notes—Compounded SOFR and Compounded SONIA” or “—Floating-Rate Notes Without Payment Delay,” as applicable or (ii) any
Non-USD
Benchmark
Replacement Conforming Changes that have been implemented with respect to such
Non-USD
Benchmark, as applicable.
“Non-USD
Benchmark Replacement Adjustment” means the first alternative set forth in the
order below that can be determined by us or our designee (after consulting with us) as of the
Non-USD
Benchmark Replacement Date:
(1)
the spread adjustment (which may be a positive or negative value or zero) that has been selected or recommended
by the
Non-USD
Relevant Governmental Body or determined by us or our designee (after consulting with us) in accordance with the method for calculating or determining such spread adjustment that has been
selected or recommended by the
Non-USD
Relevant Governmental Body, in each case for the applicable Unadjusted
Non-USD
Benchmark Replacement; and
(2)
the spread adjustment (which may be a positive or negative value or zero) that has been selected by us or our
designee (after consulting with us) giving due consideration to any industry-accepted spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the then-current
Non-USD
Benchmark with the
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applicable Unadjusted
Non-USD
Benchmark Replacement for floating-rate notes denominated in the specified currency at such time.
“Non-USD
Benchmark Replacement Conforming Changes” means, with respect to any
Non-USD
Benchmark Replacement, changes to (1) any interest determination date, interest payment date, interest period demarcation date, interest reset date, business day convention or interest period,
(2) the manner, timing and frequency of determining rates and amounts of interest that are payable on the relevant notes and the conventions relating to such determination, (3) the timing and frequency of making payments of interest,
(4) rounding conventions, (5) tenors, (6) any other terms or provisions of the relevant series of notes, in each case that we or our designee (after consulting with us) determines, from time to time, to be appropriate to reflect the
determination and implementation of such
Non-USD
Benchmark Replacement in a manner substantially consistent with market practice (or, if we or the calculation agent or our designee (after consulting with us)
decides that implementation of any portion of such market practice is not administratively feasible or if we or our designee (after consulting with us) determines that no market practice for use of the
Non-USD
Benchmark Replacement exists, in such other manner as we or our designee (after consulting with us) determines is appropriate).
“Non-USD
Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current
Non-USD
Benchmark:
(1)
in the case of clause (1) or (2) of the definition of
“Non-USD
Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of the
applicable
Non-USD
Benchmark permanently or indefinitely ceases to provide such
Non-USD
Benchmark;
(2)
in the case of clause (3) of the definition of
“Non-
USD
Benchmark Transition Event,” if such public statement or publication of information referenced therein indicates that the administrator or regulatory supervisor for the administrator has determined that such
Non-USD
Benchmark is no longer representative or otherwise not appropriate for use as a reference rate for floating-rate notes denominated in the specified currency: (a) at such time, the date of such
public statement or publication of information referenced therein; or (b) as of a specified future date, the first date on which such
Non-USD
Benchmark would ordinarily have been published or provided and
is
non-representative
by reference to the most recent statement or publication referenced therein, even if such rate continues to be published or provided on the same date; or
(3)
in the case of clause (4) of the definition of
“Non-
USD
Benchmark Transition Event,” the date of the public statement, publication of information or determination referenced therein.
For the avoidance of doubt, if the event giving rise to the
Non-USD
Benchmark Replacement Date occurs on the same day
as, but earlier than, the
Non-USD
Benchmark Reference Time in respect of any determination, the
Non-USD
Benchmark Replacement Date will be deemed to have occurred prior
to the
Non-USD
Benchmark Reference Time for such determination.
“Non-USD
Benchmark Transition Event” means the occurrence of one or more of the following
events with respect to the then-current
Non-USD
Benchmark:
(1)
a public statement or publication of information by or on behalf of the administrator of such
Non-USD
Benchmark announcing that such administrator has ceased or will cease to provide such
Non-USD
Benchmark, permanently or indefinitely, provided that, at the time of
such statement or publication, there is no successor administrator that will continue to provide such
Non-USD
Benchmark;
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(2)
a public statement or publication of information by the regulatory supervisor for the administrator of such
Non-USD
Benchmark, the central bank for the currency of such
Non-USD
Benchmark, an insolvency official with jurisdiction over the administrator for such
Non-USD
Benchmark, a resolution authority with jurisdiction over the administrator for such
Non-USD
Benchmark or a court or an entity with similar insolvency or resolution
authority over the administrator for such
Non-USD
Benchmark, which states that the administrator of such
Non-USD
Benchmark has ceased or will cease to provide such
Non-USD
Benchmark permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide such
Non-USD
Benchmark;
(3)
a public statement or publication of information by the regulatory supervisor for the administrator of such
Non-USD
Benchmark announcing that the regulatory supervisor has determined that such
Non-USD
Benchmark is no longer, or as of a specified future date will no longer be,
representative of the underlying market and economic reality that such
Non-USD
Benchmark is intended to measure and that representativeness will not be restored or such
Non-USD
Benchmark otherwise is not, or as at a specified future date will no longer be appropriate for use as a reference rate for floating-rate notes denominated in the specified currency at such time; or
(4)
a determination by us or our designee (after consulting with us) that such
Non-USD
Benchmark for the specified maturity, if applicable, has been permanently or indefinitely discontinued.
“Non-USD
Corresponding Tenor” with respect to a
Non-USD
Benchmark Replacement means a tenor (including overnight) having approximately the same length (disregarding business day adjustment) as the applicable tenor for the then-current
Non-USD
Benchmark.
“Non-USD
Interpolated Benchmark”
means, where the then-current
Non-USD
Benchmark is EURIBOR or another forward-looking term rate for which multiple tenors are published by the applicable administrator, the rate determined for the
Non-USD
Corresponding Tenor by interpolating on a linear basis between: (1) the
Non-USD
Benchmark for the longest period (for which the
Non-USD
Benchmark is available) that is shorter than the
Non-USD
Corresponding Tenor and (2) the
Non-USD
Benchmark for the
shortest period (for which the
Non-USD
Benchmark is available) that is longer than the
Non-USD
Corresponding Tenor.
“Non-USD
Benchmark” as used in clause (1) and (2) of the foregoing definition means the then-current
Non-USD
Benchmark for the applicable periods
specified in such clauses without giving effect to the applicable index maturity (if any).
“Non-USD
Benchmark Reference Time” with respect to any determination of the
Non-USD
Benchmark means (1) with respect to EURIBOR notes, if the
Non-USD
Benchmark is EURIBOR, 11:00 a.m., Brussels time, on the relevant interest determination date,
(2) with respect to compounded SONIA notes, if the
Non-USD
Benchmark is SONIA, 12:00 p.m., London time, on the date of such determination, and (3) otherwise, the time determined by us or our designee
(after consulting with us) in accordance with the
Non-USD
Benchmark Replacement Conforming Changes.
“Non-USD
Relevant Governmental Body” means, with respect to any
Non-USD
Benchmark, the central bank, monetary authority, relevant regulatory supervisor or any similar institution (including any committee or working group thereof sponsored, convened or endorsed by such central
bank, monetary authority or relevant regulatory supervisor) with supervisory authority over the then-current
Non-USD
Benchmark or specified currency for the applicable series of notes.
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“Unadjusted
Non-USD
Benchmark
Replacement” means the
Non-USD
Benchmark Replacement excluding the
Non-USD
Benchmark Replacement Adjustment.
Additional Information About SOFR
As further described in this prospectus supplement, the interest rate on compounded SOFR notes and simple average SOFR notes will be
determined by reference to a rate based on SOFR.
In general, the following discussion relating to SOFR is based on information available
on the SOFR Administrator’s Website. SOFR is published by the FRBNY and is intended to be a broad measure of the cost of borrowing cash overnight collateralized by U.S. Treasury securities. FRBNY reports that SOFR includes all trades in the
Broad General Collateral Rate, plus bilateral Treasury repurchase agreement (“repo”) transactions cleared through the delivery-versus-payment service offered by the Fixed Income Clearing Corporation (the “FICC”), a subsidiary
of The Depository Trust & Clearing Corporation (“DTCC”). SOFR is filtered by FRBNY to remove a portion of the foregoing transactions considered to be “specials.” According to FRBNY, “specials” are repos
for specific-issue collateral which take place at cash-lending rates below those for general collateral repos because cash providers are willing to accept a lesser return on their cash in order to obtain a particular security.
FRBNY reports that SOFR is calculated as a volume-weighted median of transaction-level
tri-party
repo
data collected from The Bank of New York Mellon, which currently acts as the clearing bank for the
tri-party
repo market, as well as General Collateral Finance Repo transaction data and data on bilateral U.S.
Treasury repo transactions cleared through the FICC’s delivery-versus-payment service. FRBNY notes that it obtains information from DTCC Solutions LLC, an affiliate of DTCC.
If data for a given market segment were unavailable for any day, then the most recently available data for that segment would be utilized,
with the rates on each transaction from that day adjusted to account for any change in the level of market rates in that segment over the intervening period. SOFR would be calculated from this adjusted prior day’s data for segments where
current data were unavailable, and unadjusted data for any segments where data were available. To determine the change in the level of market rates over the intervening period for the missing market segment, the FRBNY would use information collected
through a daily survey conducted by its trading desk of primary dealers’ repo borrowing activity. Such daily survey would include information reported by BofA Securities, Inc., our affiliate, as a primary dealer. On June 3, 2019, FRBNY
used this daily survey mechanism to calculate SOFR for May 31, 2019, when access was disrupted to one of the three primary data sources used to calculate the SOFR.
FRBNY currently publishes SOFR daily on its website at https://apps.newyorkfed.org/markets/autorates/sofr. FRBNY states on its publication
page for SOFR that use of SOFR is subject to important disclaimers, limitations and indemnification obligations, including that FRBNY may alter the methods of calculation, publication schedule, rate revision practices or availability of SOFR at any
time without notice.
Each U.S. government securities business day, the FRBNY publishes SOFR on its website at approximately 8:00 a.m.,
New York City time. If errors are discovered in the transaction data provided by The Bank of New York Mellon or DTCC Solutions LLC, or in the calculation process, subsequent to the initial publication of SOFR but on that same day, SOFR and the
accompanying summary statistics may be republished at approximately 2:30 p.m., New York City time. Additionally, if transaction data from The Bank of New York Mellon or DTCC Solutions LLC had previously not been available in time for publication,
but became available later in the day, the affected rate or rates may be republished at around this time. Rate revisions will only be effected
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on the same day as initial publication and will only be republished if the change in the rate exceeds one basis point. Any time a rate is revised, a footnote to the FRBNY’s publication
would indicate the revision. This revision threshold will be reviewed periodically by the FRBNY and may be changed based on market conditions.
SOFR is published by FRBNY based on data received from other sources, and we have no control over its determination, calculation or
publication.
FRBNY started publishing SOFR in April 2018. FRBNY also has published historical indicative Secured Overnight Financing
Rates dating back to 2014, although such historical indicative data inherently involves assumptions, estimates and approximations. Investors should not rely on such historical indicative data or on any historical changes or trends in SOFR as an
indicator of the future performance of SOFR.
Neither the SOFR Administrator’s Website, nor any of the information or materials
available thereon, are incorporated by reference into this prospectus supplement.
Neither are we affiliated with FRBNY, nor does FRBNY
sanction, endorse, or recommend any products or services offered by us.
Fixed-Rate Reset Notes
We may issue notes that will bear interest initially at a fixed interest rate for a specified portion of the applicable term and then reset
such fixed interest rate by reference to a “reset reference rate” at one or more specified intervals for the remainder of such term as determined in accordance with the terms and provisions set forth in the applicable supplement and
below in this prospectus supplement under “—Determination of Interest Rates for Fixed-Rate Reset Notes” and “—Determination of Reset Reference Rates.” We refer to these notes as “fixed-rate reset
notes.”
Overview of Interest Rates and Reset Reference Rates for Fixed-Rate Reset Notes
Each fixed-rate reset note will bear interest from, and including, its original issue date to, but excluding, the “first reset
date” specified in the applicable supplement, at the rate per annum specified to be the “initial interest rate” in the applicable supplement. The interest rate on any fixed-rate reset note will reset on the applicable first reset
date and on any applicable subsequent reset date(s) specified in the applicable supplement, all in accordance with the terms and provisions of fixed-rate reset notes set forth below in this prospectus supplement under “—Determination of
Interest Rates for Fixed-Rate Reset Notes.” The interest rate to which any fixed-rate reset note resets on the first reset date and any applicable subsequent reset date(s) will be determined by reference to the reset reference rate plus the
applicable “spread,” if any, each as specified in the applicable supplement. The reset reference rate will be either the U.S. Treasury Rate or the UK Government Bond (Gilt) Rate, as specified in the applicable supplement to be the reset
reference rate and as determined in accordance with the terms and provisions set forth below in this prospectus supplement under “—Determination of Reset Reference Rates—UK Government Bond (Gilt) Rate” or
“—Determination of Reset Reference Rates—U.S. Treasury Rate,” as applicable.
Accrual of Interest and
Interest Payment Dates
We will pay interest on any fixed-rate reset note quarterly, semiannually, or annually, as applicable, in
arrears, on the days set forth in the applicable supplement (each such day being an “interest payment date” for a fixed-rate reset note) and at the maturity date or earlier redemption date, as applicable. Each interest payment due on an
interest payment date, the maturity date or earlier redemption date, as applicable, will include interest accrued from, and including, the most
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recent interest payment date to which interest has been paid, or, if no interest has been paid, from the original issue date, to, but excluding, the next interest payment date, the maturity date
or earlier redemption date, as the case may be (each such period, an “interest period”). The amount of accrued interest on any fixed-rate reset note for an interest period is calculated by multiplying the principal amount of such note by
an accrued interest factor. This accrued interest factor will be determined by multiplying the per annum fixed interest rate by a factor resulting from the day count convention that applies with respect to such determination. The interest rate
applicable with respect to any interest period for any fixed-rate reset note will be the rate per annum determined in accordance with the applicable terms and provisions set forth below under “—Determination of Interest Rates for
Fixed-Rate Reset Notes” and “—Determination of Reset Reference Rates.”
If no day count convention is specified in
the applicable supplement, the accrued interest factor will be as follows:
•
for fixed-rate reset notes for which the reset reference rate is specified in the applicable supplement to be the
U.S. Treasury Rate, the factor will be computed on the basis of a
360-day
year consisting of twelve
30-day
months, which we may refer to as the “30/360” day
count convention; and
•
for fixed-rate reset notes for which the reset reference rate is specified in the applicable supplement to be the
UK Government Bond (Gilt) Rate, the factor will be computed on the basis of an Actual/Actual (ICMA) (as defined in the rulebook of the International Capital Markets Association) day count convention, which we may refer to as the “Actual/Actual
(ICMA)” day count convention.
We will make payments on fixed-rate reset notes as described below in this
prospectus supplement under “—Payment of Principal, Interest, and Other Amounts Payable” and in the accompanying prospectus under the heading “Description of Debt Securities—Payment of Principal, Interest, and Other
Amounts Payable.”
Determination of Interest Rates for Fixed-Rate Reset Notes
Each fixed-rate reset note will bear interest:
(i)
from, and including, the original issue date to, but excluding, the first reset date (such period, the
“initial fixed rate period”) at a rate per annum equal to the initial interest rate;
(ii)
from, and including, the first reset date to, but excluding, the first “subsequent reset date“
specified in the applicable supplement or, if no subsequent reset dates are specified in the applicable supplement, the maturity date or earlier redemption date, as the case may be, at a rate per annum equal to the first reset interest rate; and
(iii)
for each applicable subsequent reset period thereafter (if any), at a rate per annum equal to the applicable
subsequent reset interest rate,
payable, in each case, in arrears on each applicable interest payment date, the maturity date or
earlier redemption date, as the case may be. For the avoidance of doubt, the applicable interest rate specified in the preceding sentence will apply for each interest period falling within the initial fixed rate period and any reset period, as
applicable.
In addition, for the avoidance of doubt, the “first reset date” and “subsequent reset date(s),” if
any, for each fixed-rate reset note will be specified in the applicable supplement.
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The interest rate applicable during each reset period will be determined by the calculation
agent on each applicable reset determination date. See “—Calculation Agents; Decisions and Determinations.”
Interest
rates for a fixed-rate reset note may also be subject to:
•
a maximum interest rate limit, or ceiling, on the interest that may accrue during any interest or other
applicable period; and/or
•
a minimum interest rate limit, or floor, on the interest that may accrue during any interest or other applicable
period.
In addition, the interest rate on a fixed-rate reset note may not be higher than the maximum rate permitted by
New York law, as that rate may be modified by U.S. law of general application. Under current New York law, the maximum rate of interest, subject to some exceptions, for any loan in an amount less than $250,000 is 16% and for any loan in the amount
of $250,000 or more but less than $2,500,000 is 25% per annum on a simple interest basis. These limits do not apply to loans of $2,500,000 or more to any one borrower.
For purposes of the foregoing terms and provisions, the following terms have the meanings set forth below:
“first reset interest rate” means, in respect of the first reset period, a per annum interest rate equal to the sum of
(a)
the relevant reset reference rate determined as of the relevant reset determination date and (b) the “spread” specified in the applicable supplement for such first reset interest rate.
“first reset period” means the period from, and including, the first reset date to, but excluding, the first subsequent reset date
or, if no subsequent reset dates are specified in the applicable supplement, the maturity date or earlier redemption date, as applicable.
“reset date” means the first reset date and each applicable subsequent reset date, if any.
“reset determination date” means, unless otherwise specified in the applicable supplement:
(a)
with respect to any fixed-rate reset note for which the reset reference rate is the UK Government Bond (Gilt)
Rate, the second London banking day (or such other number of London banking days as we may specify in the applicable supplement) preceding the applicable reset date; and
(b)
with respect to any fixed-rate reset note for which the reset reference rate is the U.S. Treasury Rate, the
third business day (or such other number of business days as we may specify in the applicable supplement) preceding the applicable reset date.
“reset period” means the first reset period or a subsequent reset period, as applicable.
“reset reference rate” means either (a) the U.S. Treasury Rate or (b) the UK Government Bond (Gilt) Rate, as specified
in the applicable supplement and determined in accordance with the terms and provisions set forth below in this prospectus supplement under “—Determination of Reset Reference Rates—U.S. Treasury Rate” or
“—Determination of Reset Reference Rates—UK Government Bond (Gilt) Rate,” as applicable.
“subsequent reset
interest rate” means, in respect of any subsequent reset period, a per annum interest rate equal to the sum of (a) the relevant reset reference rate determined as of the relevant reset determination date and (b) the
“spread” specified in the applicable supplement for such subsequent reset interest rate.
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“subsequent reset period” means the period from, and including, the first
subsequent reset date to, but excluding, the next subsequent reset date or, if no additional subsequent reset dates are specified in the applicable supplement, the maturity date or earlier redemption date, as applicable, and each successive period
from, and including, to, but excluding, the next subsequent reset date or maturity date or earlier redemption date, as applicable.
Determination of Reset Reference Rates
U.S. Treasury Rate
For any reset period commencing on or after the first reset date, the “U.S. Treasury Rate” will be determined by the calculation
agent in the following manner:
(1)
the average of the yields on actively traded U.S. treasury
nominal/non-inflation-indexed
securities adjusted to constant maturities, for the maturity comparable to such reset period, for the five business days (or such other number of business days as we may specify
in the applicable supplement) immediately preceding the applicable reset determination date and appearing (or, if fewer than five business days (or such other number of business days as we may specify in the applicable supplement) so appear on the
applicable reset determination date, for such number of business days appearing) in the most recently published H.15 Daily Update as of 5:00 p.m., New York City time, on the applicable reset determination date; or
(2)
if there are no such published yields on actively traded U.S. treasury
nominal/non-inflation-indexed
securities adjusted to constant maturities, for such maturity, then the “U.S. Treasury Rate” will be determined by interpolation between the average of the yields on
actively traded U.S. treasury
nominal/non-inflation-indexed
securities adjusted to constant maturities for two series of actively traded U.S. treasury
nominal/non-inflation-indexed
securities, (A) one maturing as close as possible to, but earlier than, the reset date following the next succeeding reset determination date (or, if there is no such reset
date, the maturity date) and (B) the other maturing as close as possible to, but later than, such reset date or maturity date, as applicable, in each case for the five business days (or such other number of business days as we may specify in
the applicable supplement) preceding the applicable reset determination date and appearing (or, if fewer than five business days (or such other number of business days as we may specify in the applicable supplement) so appear on the applicable reset
determination date, for such number of business days appearing) in the most recently published H.15 Daily Update as of 5:00 p.m., New York City time, on the applicable reset determination date.
In each case, the U.S. Treasury Rate will be rounded, if necessary, to the nearest one thousandth of a percentage point, with 0.0005% rounded
up to 0.001%.
Notwithstanding the foregoing, if we or our designee, after consulting with us, determines that the then-current reset
reference rate (which, as of the original issue date for any series of fixed-rate reset notes, will be the U.S. Treasury Rate for the specified maturity set forth in the applicable supplement) cannot be determined in the manner applicable for such
reset reference rate (which, as of the original issue date of such series of fixed-rate reset notes, will be pursuant to the methods described in clauses (1) or (2) above) on the applicable reset determination date (such determination, a
“rate substitution event”), we or our designee, after consulting with us, may determine whether there is an industry-accepted successor rate to the then-current reset reference rate (such industry-accepted successor rate, the
“replacement rate“). If we or our designee, after consulting with us, determines that there is such a replacement rate, then such replacement rate will replace the U.S. Treasury Rate (or the then-current reset reference rate) for all
purposes
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relating to an applicable series of fixed-rate reset notes in respect of such determination on such reset determination date and all determinations on all subsequent reset determination dates. In
addition, if a replacement rate is utilized as described in the preceding sentence, we or our designee, after consulting with us, may adopt or make changes to (1) any interest payment date, reset determination date, reset date, other relevant
date, business day convention, interest period or reset period, (2) the manner, timing and frequency of determining rates and amounts of interest that are payable on the applicable series of fixed-rate reset notes and the conventions relating
to such determination, (3) the timing and frequency of making payments of interest, (4) rounding conventions, (5) specified maturities, and (6) any other terms or provisions of the relevant series of notes (including any spread
or adjustment factor needed to make such replacement rate comparable to the then-current reset reference rate (which, as of the original issue date of for any series of fixed-rate reset notes, will be the U.S. Treasury Rate for the specified
maturity)), in each case that we or our designee, after consulting with us, determines, from time to time, to be appropriate to reflect the determination and implementation of such replacement rate in a manner substantially consistent with market
practice (or, if we, the calculation agent or our designee, after consulting with us, determines that implementation of any portion of such market practice is not administratively feasible or if we or our designee, after consulting with us,
determines that no market practice for use of such replacement rate exists, in such other manner as we or our designee, after consulting with us, determines is appropriate) (such changes, the “U.S. Treasury Rate adjustments”). If we or
our designee, after consulting with us, determines that there is no such replacement rate, then the interest rate for the applicable reset period will be: (a) if the first reset interest rate is to be determined, the initial interest rate or
(b) if a subsequent reset interest rate is to be determined, the interest rate that was applicable for the preceding reset period.
For purposes of the foregoing terms and provisions with respect to the determination of the U.S. Treasury Rate, the following term has the
meaning set forth below:
“H.15 Daily Update” means the Selected Interest Rates
(Daily)-H.15
release of the Federal Reserve, available at www.federalreserve.gov/releases/h15/update, or any successor site or publication.
UK Government Bond (Gilt) Rate
For any reset period commencing on or after the first reset date, the “UK Government Bond (Gilt) Rate” will be determined by us
and the gilt determination agent in the following manner:
(1)
the yield (rounded to four decimal places, with 0.00005% being rounded upwards) of the Tradeweb FTSE Gilt
Closing Price of the applicable benchmark gilt (as determined by us and the gilt determination agent) in respect of such reset period that appears on the Bloomberg Screen Page “TWMD2” (or any successor or replacement page) (the
“Gilt Screen Page”) at 3:00 p.m. (London time) on the applicable reset determination date; or
(2)
if the Gilt Screen Page is not available or has been discontinued, or if it is specified in the applicable
supplement that the UK Government Bond (Gilt) Rate will not be determined by reference to the Gilt Screen Page as set forth in clause (1) above, or no yield of such benchmark gilt in respect of such reset period appears on such page on the
applicable reset determination date (as determined by us or the gilt determination agent in consultation with us), then the applicable UK Government Bond (Gilt) Rate will be the gross redemption yield (as calculated by the gilt determination agent
in consultation with us in accordance with generally accepted market practice at the time of determination) on a semi-annual compounding basis (converted to an annualized yield and rounded up, if necessary, to four decimal places, with 0.00005%
being rounded upwards) of the benchmark gilt in respect of that reset period, with the price of the benchmark gilt for this
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purpose being the arithmetic average (rounded up if necessary, to the nearest 0.001%, with 0.0005% being rounded up) of the bid and offered prices of such benchmark gilt quoted by the reset
reference banks at 3:00 p.m., London time, on the relevant reset determination date on a dealing basis for settlement on the next following dealing day in London. If at least four quotations are provided, the benchmark gilt rate will be the rounded
arithmetic mean of the quotations provided, eliminating the highest quotation (or, in the event of equality, one of the highest) and the lowest quotation (or, in the event of equality, one of the lowest). If only two or three quotations are
provided, the benchmark gilt rate will be the rounded arithmetic mean of the quotations provided. If only one quotation is provided, the benchmark gilt rate will be the rounded quotation provided. If no quotations are provided, then the interest
rate for the applicable reset period will be: (a) if the first reset interest rate is to be determined, the initial interest rate or (b) if a subsequent reset interest rate is to be determined, the interest rate that was applicable for the
preceding reset period.
The gilt determination agent will notify us of the benchmark gilt rate once available. Absent
manifest error, all determinations of the gilt determination agent will be final and binding on you, the trustee and us.
For purposes of
the foregoing terms and provisions with respect to the determination of the UK Government Bond (Gilt) Rate, the following terms have the meanings set forth below:
“gilt determination agent” means an independent financial institution of international repute or other independent financial
advisor, in each case which may be one of our affiliates, experienced in the international capital markets, in each case appointed by us at our own expense.
“benchmark gilt” means, in respect of a reset period, such United Kingdom government security having an actual or interpolated
maturity comparable to such reset period, as would be used at the time of selection and in accordance with customary financial practice, in pricing new issues of Sterling-denominated corporate debt securities which have a maturity comparable to such
reset period as we and the gilt determination agent may determine to be appropriate.
“dealing day” means a day, other than a
Saturday or Sunday, on which the London Stock Exchange (or such other stock exchange on which the benchmark gilt is at the relevant time listed) is ordinarily open for the trading of securities.
“reset reference banks” means five brokers of gilts and/or gilt-edged market makers selected by us in our discretion.
Effect of a Gilt Transition Event and Related Gilt Replacement Date
Gilt Benchmark Replacement
. If we or our designee (after consulting with us) determines on or prior to the relevant Gilt Reference Time
that a Gilt Benchmark Transition Event and related Gilt Benchmark Replacement Date have occurred with respect to the then-current Gilt Benchmark for any series of notes, the applicable Gilt Benchmark Replacement will replace the then-current Gilt
Benchmark for such series of notes for all purposes relating to the relevant notes in respect of all determinations on such date and for all determinations on all subsequent dates.
Gilt Benchmark Replacement Conforming Changes
. In connection with the implementation of a Gilt Benchmark Replacement, we or our
designee (after consulting with us) will have the right to make Gilt Benchmark Replacement Conforming Changes from time to time.
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Certain Defined Terms
. As used in this prospectus supplement with respect to any Gilt
Benchmark Transition Event and implementation of the applicable Gilt Benchmark Replacement and Gilt Benchmark Replacement Conforming Changes:
“Gilt Benchmark” means, initially, the applicable benchmark gilt for the applicable series of notes; provided, in each case, that
if a Gilt Benchmark Transition Event and related Gilt Benchmark Replacement Date have occurred with respect to such initial Gilt Benchmark, as applicable, or the then-current Gilt Benchmark, then “Gilt Benchmark” means the applicable
Gilt Benchmark Replacement.
“Gilt Benchmark Replacement” means the Gilt Interpolated Benchmark (if applicable) with respect
to the then-current Gilt Benchmark, plus the Gilt Benchmark Replacement Adjustment for such Gilt Benchmark (if applicable); provided that if the gilt determination agent cannot determine the Gilt Interpolated Benchmark as of the Gilt Benchmark
Replacement Date, then “Gilt Benchmark Replacement” means the first alternative set forth in the order below that can be determined by us or our designee, after consulting with us, as of the Gilt Benchmark Replacement Date:
(1)
the sum of: (a) the alternate rate of interest that has been selected or recommended by the Gilt Relevant
Governmental Body or identified through any other applicable regulatory or legislative action or guidance as the replacement for the then-current Gilt Benchmark for the applicable Gilt Corresponding Tenor (if any) and (b) the Gilt Benchmark
Replacement Adjustment;
(2)
the sum of: (a) the alternate rate of interest that has been selected by us or our designee (after
consulting with us) as the replacement for the then-current Gilt Benchmark for the applicable Gilt Corresponding Tenor giving due consideration to any industry-accepted rate of interest as a replacement for the then-current Gilt Benchmark for
floating-rate notes denominated in pounds sterling at such time and (b) the Gilt Benchmark Replacement Adjustment;
provided that,
if we or our designee (after consulting with us) determines that there is no such alternate rate of interest as of the applicable Gilt Benchmark Replacement Date, then the Gilt Benchmark will be the most recent rate that could have been determined
for such Gilt Benchmark in accordance with (i) the terms and provisions for determining such Gilt Benchmark in the first paragraph above under the heading “—UK Government Bond (Gilt) Rate” or (ii) any Gilt Benchmark
Replacement Conforming Changes that have been implemented with respect to such Gilt Benchmark, as applicable.
“Gilt Benchmark
Replacement Adjustment” means the first alternative set forth in the order below that can be determined by us or our designee (after consulting with us) as of the Gilt Benchmark Replacement Date:
(1)
the spread adjustment (which may be a positive or negative value or zero) that has been selected or recommended
by the Gilt Relevant Governmental Body or determined by us or our designee (after consulting with us) in accordance with the method for calculating or determining such spread adjustment that has been selected or recommended by the Gilt Relevant
Governmental Body, in each case for the applicable Gilt Unadjusted Benchmark Replacement; and
(2)
the spread adjustment (which may be a positive or negative value or zero) that has been selected by us or our
designee (after consulting with us) giving due consideration to any industry-accepted spread adjustment, or method for calculating or determining such
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spread adjustment, for the replacement of the then-current Gilt Benchmark with the applicable Unadjusted Gilt Benchmark Replacement for notes comparable to the fixed-rate reset notes denominated
in pounds sterling at such time.
“Gilt Benchmark Replacement Conforming Changes” means, with respect to any
Gilt Benchmark Replacement, changes to (1) any reset determination date, reset date, interest payment date, reset period, business day convention or interest period, (2) the manner, timing and frequency of determining rates and amounts of
interest that are payable on the relevant notes and the conventions relating to such determination, (3) the timing and frequency of making payments of interest, (4) rounding conventions, (5) tenors, and (6) any other terms or
provisions of the relevant series of notes, in each case that we or our designee (after consulting with us) determines, from time to time, to be appropriate to reflect the determination and implementation of such Gilt Benchmark Replacement in a
manner substantially consistent with market practice or, if we or the gilt determination agent or our designee (after consulting with us) decides that implementation of any portion of such market practice is not administratively feasible or if we or
our designee (after consulting with us) determines that no market practice for use of the Gilt Benchmark Replacement exists, in such other manner as we or our designee (after consulting with us) determines is appropriate.
“Gilt Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current Gilt
Benchmark:
(1)
in the case of clause (1) or (2) of the definition of “Gilt Benchmark Transition Event,” the
later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of the applicable Gilt Benchmark permanently or indefinitely ceases to provide such Gilt Benchmark;
or
(2)
in the case of clause (3) of the definition of “Gilt Benchmark Transition Event,” if such
public statement or publication of information referenced therein indicates that the administrator or regulatory supervisor for the administrator has determined that such Gilt Benchmark is no longer representative or otherwise not appropriate for
use as a reference rate for floating-rate notes denominated in pounds sterling: (a) at such time, the date of such public statement or publication of information referenced therein; or (b) as of a specified future date, the first date on
which such Gilt Benchmark would ordinarily have been published or provided and is
non-representative
by reference to the most recent statement or publication referenced therein, even if such rate continues to
be published or provided on the same date; or
(3)
in the case of clause (4) of the definition of “Gilt Benchmark Transition Event,” the date of
the public statement, publication of information or determination referenced therein.
For the avoidance of doubt, if the event giving
rise to the Gilt Benchmark Replacement Date occurs on the same day as, but earlier than, the Gilt Benchmark Reference Time in respect of any determination, the Gilt Benchmark Replacement Date will be deemed to have occurred prior to the Gilt
Benchmark Reference Time for such determination.
“Gilt Benchmark Transition Event” means the occurrence of one or more of the
following events with respect to the then-current Gilt Benchmark:
(1)
a public statement or publication of information by or on behalf of the administrator of such Gilt Benchmark
announcing that such administrator has ceased or will cease to provide such Gilt Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide
such Gilt Benchmark;
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(2)
a public statement or publication of information by the regulatory supervisor for the administrator of such
Gilt Benchmark, the central bank for the currency of such Gilt Benchmark, an insolvency official with jurisdiction over the administrator for such Gilt Benchmark, a resolution authority with jurisdiction over the administrator for such Gilt
Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for such Gilt Benchmark, which states that the administrator of such Gilt Benchmark has ceased or will cease to provide such Gilt Benchmark
permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide such Gilt Benchmark;
(3)
a public statement or publication of information by the regulatory supervisor for the administrator of such
Gilt Benchmark announcing that the regulatory supervisor has determined that such Gilt Benchmark is no longer, or as of a specified future date will no longer be, representative of the underlying market and economic reality that such Gilt Benchmark
is intended to measure and that representativeness will not be restored or such Gilt Benchmark otherwise is not, or as at a specified future date will no longer be appropriate for use as a reference rate for notes denominated in pounds sterling at
such time; or
(4)
a determination by us or our designee (after consulting with us) that such Gilt Benchmark for the specified
maturity, if applicable, has been permanently or indefinitely discontinued.
“Gilt Corresponding Tenor” with
respect to a Gilt Benchmark Replacement means a tenor (including overnight) having approximately the same length (disregarding business day adjustment) as the applicable tenor for the then-current Gilt Benchmark.
“Gilt Interpolated Benchmark” means, if the then-current Gilt Benchmark is a forward-looking term rate for which multiple tenors
are published by the applicable administrator, the rate determined for the Gilt Corresponding Tenor by interpolating on a linear basis between: (1) the Gilt Benchmark for the longest period (for which the Gilt Benchmark is available) that is
shorter than the Gilt Corresponding Tenor and (2) the Gilt Benchmark for the shortest period (for which the Gilt Benchmark is available) that is longer than the Gilt Corresponding Tenor. “Gilt Benchmark” as used in clause
(1) and (2) of the foregoing definition means the then-current Gilt Benchmark for the applicable periods specified in such clauses without giving effect to the applicable index maturity (if any).
“Gilt Reference Time” with respect to any determination of the Gilt Benchmark means, if the Gilt Benchmark is the UK Government
Bond (Gilt) Rate, 3:00 p.m. (London time) on the date of such determination, and (3) otherwise, the time determined by us or our designee (after consulting with us) in accordance with the Gilt Benchmark Replacement Conforming Changes.
“Gilt Relevant Governmental Body” means, with respect to any Gilt Benchmark, the BoE, the UK Financial Conduct Authority or any
other central bank, monetary authority, relevant regulatory supervisor or any similar institution (including any committee or working group thereof sponsored, convened or endorsed by the BoE, the UK Financial Conduct Authority or any such central
bank, monetary authority or relevant regulatory supervisor) with supervisory authority over the then-current Gilt Benchmark or pounds sterling.
“Unadjusted Gilt Benchmark Replacement” means the Gilt Benchmark Replacement excluding the Gilt Benchmark Replacement Adjustment.
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Specific Terms and Provisions of the Notes
The applicable supplement(s) for each offering of notes will contain terms of the offering and specific terms and provisions of those notes,
in addition to the terms and provisions relating to interest rates set forth in preceding sections of this prospectus supplement, including:
•
the specific designation of the notes;
•
the issue price;
•
the principal amount;
•
the issue date;
•
the stated maturity date, and any terms providing for the extension or postponement of the stated maturity date;
•
the denominations or minimum denominations of the notes, if other than $1,000;
•
the currency or currencies, if not U.S. dollars, in which payments will be made on the notes;
•
whether the note is a fixed-rate note, a floating-rate note, a fixed/floating-rate note or a fixed-rate reset
note;
•
whether the note is senior or subordinated;
•
the method of determining and paying any interest, including any applicable interest rate basis or bases, any
initial interest rate, or the method for determining any initial interest rate, any interest period demarcation dates, any interest reset dates, any payment dates, any observation periods, any applicable tenor, and any maximum or minimum rate of
interest, as applicable;
•
any spread or spread multiplier applicable to a floating-rate note or fixed-rate reset note;
•
the method for the calculation and payment of principal and/or any premium, interest, and other amounts payable;
•
if other than the trustee, the identification of or method of selecting any calculation agents, exchange rate
agents, or any other agents for the notes;
•
if applicable, the circumstances under which the note may be redeemed at our option or repaid at your option
prior to the maturity date set forth on the face of the note, including any repayment date, redemption commencement date, redemption price, and redemption period;
•
if applicable, the circumstances under which the stated maturity date set forth on the face of the note may be
extended at our option or renewed at your option, including the extension or renewal periods and the final maturity date;
•
if applicable, any addition to, elimination of or other change in the events of default or covenants for the
senior notes or remedies available to investors in the senior notes;
•
if the notes will be listed on any securities exchange; and
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•
if applicable, any other material terms or provisions of the note which are different from or in addition to
those described in this prospectus supplement and the accompanying prospectus.
Each note will mature 365 days (one
year) or more from the issue date.
Unless we specify otherwise in the applicable supplement, the notes will not be entitled to the
benefit of any sinking fund.
Calculation Agents; Decisions and Determinations
Calculations relating to floating-rate notes and fixed-rate reset notes, including: (1) with respect to floating-rate notes, calculations
with respect to base rates, interest rates, accrued interest, principal and any premium, and any other amounts payable applicable to floating-rate notes and (ii) with respect to fixed-rate reset notes, calculations with respect to reset
reference rates, first reset interest rates and subsequent reset interest rates, as the case may be, will be made by the applicable calculation agent, which will be an institution that we appoint as our agent for this purpose. The calculation agent
may be one of our affiliates or may be a
non-affiliated
entity that we appoint. Unless we specify otherwise in the applicable supplement, the calculation agent will be: (i) with respect to any series of
floating-rate notes or fixed-rate reset notes denominated in U.S. dollars, The Bank of New York Mellon Trust Company, N.A., (ii) with respect to any series of floating-rate notes or fixed-rate reset notes denominated in Canadian dollars, Merrill
Lynch Canada Inc. and (iii) with respect to any series of floating-rate notes or fixed-rate reset notes denominated in Australian dollars, pounds sterling or euro, The Bank of New York Mellon, London Branch. We have entered into agreements with
each of the foregoing entities for purposes of their acting as calculation agent with respect to any applicable series of floating-rate notes and fixed-rate reset notes. In addition, we may provide that we will appoint the calculation agent after
the original issue date of such floating-rate notes or fixed-rate reset notes but before the first date on which a calculation is required to be performed under the terms of such floating-rate notes or fixed-rate reset notes without notice to the
investors in the applicable series of notes. We may remove and/or appoint different calculation agents from time to time after the original issue date of a floating-rate note or fixed-rate reset note, or we may elect to act as the calculation agent
with respect to such note, in each case without your consent and without notifying you of the change.
In addition, the terms and
provisions of certain floating-rate notes and fixed-rate reset notes provide that we or our designee may make certain determinations, decisions and elections with respect to (i) the determination of applicable base rates for floating-rate notes
or reset reference rates for fixed-rate reset notes if such base rates or reset reference rates are unavailable and (ii) the applicability and implementation of the applicable benchmark transition provisions relating to such base rates and
reset reference rates. If we have appointed a designee to make any such determination, decision or election and such designee fails to do so, then we will make such determination, decision or election.
Unless otherwise specified in the applicable supplement, any determination, decision or election that may be made by us or the applicable
calculation agent or other designee of ours (which may be one of our affiliates) pursuant to the terms and provisions of the floating-rate notes or fixed-rate reset notes set forth in this prospectus supplement or in the applicable supplement, and
any decision to take or refrain from taking any action or any selection:
•
will be conclusive and binding absent manifest error;
•
will be made in our or the calculation agent’s or our other designee’s sole discretion (subject, in
the case of the calculation agent, to applicable standards of care set forth in the applicable
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calculation agency agreement), except if made by the calculation agent or our other designee in connection with the applicable benchmark transition provisions set forth under (i)
“—Floating-Rate Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA—Determination of Compounded CORRA (Payment Delay),” (ii) “—Floating-Rate
Notes—Payment Delay Notes—Compounded SOFR, Compounded SONIA, Compounded CORRA and Compounded AONIA—Determination of Compounded AONIA (Payment Delay),” (iii) “—Floating Rate Notes—Floating Rate Notes without
Payment Delay—Determination of Base Rates—BBSW Notes,” (iv) “—Floating Rate Notes—Floating Rate Notes without Payment Delay— Determination of Base Rates—Compounded CORRA Notes,” (v)
“—Floating Rate Notes—Floating Rate Notes without Payment Delay— Determination of Base Rates—Compounded AONIA Notes,” (vi) “—Floating-Rate Notes—Effect of a USD Benchmark Transition Event and
Related USD Benchmark Replacement Date with Respect to SOFR,” (vii) “—Floating-Rate Notes—Effect of a
Non-USD
Benchmark Transition Event and Related
Non-USD
Benchmark Replacement Date with Respect to EURIBOR or SONIA,” (viii) “—Fixed-Rate Reset Notes—Determination of Reset Reference Rates—U.S. Treasury Rate” and (ix)
“—Fixed-Rate Reset Notes—Determination of Reset Reference Rates—UK Government Bond (Gilt) Rate” (and in all cases, with regard to the calculation agent, any such determination in connection with such benchmark
transition provisions will be limited solely to administrative feasibility as described in this prospectus supplement);
•
if made by the calculation agent or our other designee in connection with the benchmark transition provisions (as
described in the preceding bullet), will be made after consultation with us, and the calculation agent or other designee will not make any such determination, decision or election to which we object; and
•
notwithstanding anything to the contrary in the Senior Indenture or Subordinated Indenture, as applicable, or the
applicable series of floating-rate notes or fixed-rate reset notes, shall become effective without consent from the holders of the relevant series of floating-rate notes or fixed-rate reset notes or any other party.
Any determination, decision or election pursuant to the benchmark transition provisions (as described in the second bullet set forth in the
list above) not made by our designee will be made by us on the basis as described above. The calculation agent shall have no responsibility for making, or any liability for not making any such determination, decision or election in connection with
such benchmark transition provisions. In addition, we may designate an entity other than the calculation agent (which entity may be a calculation agent and/or our affiliate) to make any determination, decision or election that we have the right to
make in connection with such benchmark transition provisions. If we do not agree with any determinations made by the calculation agent regarding administrative feasibility, as described in this prospectus supplement, in connection with such
benchmark transition provisions, then we may, in our sole discretion, remove the calculation agent and appoint a successor calculation agent.
Paying and Transfer Agents; Registrars
As set forth in greater detail below, we have appointed certain entities that will act
initially as our paying agent, transfer agent and/or security registrar with respect to particular series of notes. We may add, replace or terminate paying agents, transfer agents and/or security registrars in accordance with the applicable
Indenture, in each case without your consent and without notifying you of such change. In addition, we may decide to act as our own paying agent with respect to some or all of the notes, and the paying agent may resign, in each case without your
consent and without notifying you of such event.
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With respect to any series of notes denominated in U.S. dollars, the trustee, acting through
its corporate trust office, initially will act as our paying agent, security registrar and transfer agent, pursuant to the applicable indenture. The trustee’s corporate trust office currently is located at 4655 Salisbury Road, Suite 300,
Jacksonville, Florida 32256.
With respect to any series of notes denominated in Canadian dollars, unless otherwise specified in the
applicable supplement, BNY Trust Company of Canada (the “Canadian paying agent”), acting through its office located at 1 York Street, 6th Floor, Toronto, Ontario, Canada M5J 0B6, initially will act as Canadian paying agent, security
registrar and transfer agent. We have entered into an agreement among us, the trustee and the Canadian paying agent for the purposes of the Canadian paying agent’s acting as our paying agent, security registrar and transfer agent. The trustee,
acting through its corporate office (currently located at the address set forth above) also may act as a paying agent and security registrar with respect to any such series of notes in accordance with the applicable provisions of the Indenture and
such agreement with the Canadian paying agent.
With respect to any series of notes denominated in Australian dollars, pounds sterling or
euro, unless otherwise specified in the applicable supplement, The Bank of New York Mellon, London Branch (the “London paying agent”), acting through its office at Merck House, 15 Seldown Lane, Poole, Dorset, BH15 1PX, United Kingdom,
initially will act as paying agent and transfer agent. We have entered into an agreement among us, the trustee and the London paying agent for the purposes of the London paying agent’s acting as our initial paying agent and transfer agent. The
trustee, acting through its corporate office (currently located at the address set forth above) also will act as a paying agent and the security registrar with respect to any such series of notes in accordance with the applicable provisions of the
Indenture and such agreement with the London paying agent.
Payment of Principal, Interest, and Other Amounts Payable
Payments to Holders and Record Dates for Interest
Unless we specify otherwise in the applicable supplement, the provisions described in this section will apply to payments on the notes.
Subject to any applicable business day convention as described below or in the applicable supplement, interest payments, if applicable, on the
notes will be made on each interest payment date applicable to, and at the maturity date, or earlier redemption date, of, the notes. Interest payable on any interest payment date other than the maturity date, or earlier redemption date, will be paid
to the registered holder of the note at the close of business on the regular record date for that interest payment date, as described below. However, unless we specify otherwise in the applicable supplement, the initial interest payment on a note
issued between a regular record date and the interest payment date immediately following the regular record date will be made on the second interest payment date following the original issue date to the holder of record on the regular record date
preceding the second interest payment date. Unless we specify otherwise in the applicable supplement, the principal and interest payable at maturity, or earlier redemption, will be paid to the holder of the note at the time of payment by the paying
agent.
Except as set forth in the following sentence, and unless we specify otherwise in the applicable supplement, the record date for
any interest payment for a note in book-entry only form will be the close of business on the date that is one business day prior to the applicable payment date. If the note is (i) in book-entry only form and held through DTC and is denominated
in a currency other than U.S. dollars or (ii) in a form that is other than book-entry only, and unless we specify otherwise in the applicable supplement, the regular record date for an interest payment date will be the close of business on the
fifteenth calendar day prior to the applicable interest payment date as originally scheduled to occur, whether or not such record date is a business day.
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Business Day Conventions
If the applicable supplement specifies that one of the following business day conventions is applicable to a note, the interest payment dates
(with respect to floating-rate notes other than those that use a “payment delay convention”), interest reset dates, interest period demarcation dates, if applicable, and interest periods for that note will be affected and, consequently,
may be adjusted as described below. Unless we specify otherwise in the applicable supplement, any interest payment due at maturity or on a redemption date or repayment date will not be affected as described below.
•
“Following business day convention (adjusted)” means, if an interest payment date or interest period
demarcation date (if applicable) would otherwise fall on a day that is not a business day (as described below), then such interest payment date or interest period demarcation date, as applicable, will be postponed to the next day that is a business
day. Unless we specify otherwise in the applicable supplement, the related interest reset dates and interest periods also will be adjusted for
non-business
days.
•
“Modified following business day convention (adjusted)” means, if an interest payment date or
interest period demarcation date, if applicable, would otherwise fall on a day that is not a business day, then such interest payment date or interest period demarcation date, as applicable, will be postponed to the next day that is a business day,
except that, if the next succeeding business day falls in the next calendar month, then such interest payment date or interest period demarcation date, as applicable, will be advanced to the immediately preceding day that is a business day. In each
case, unless we specify otherwise in the applicable supplement, the related interest reset dates and interest periods also will be adjusted for
non-business
days.
•
“Following unadjusted business day convention” means, if an interest payment date falls on a day that
is not a business day, any payment due on such interest payment date will be postponed to the next day that is a business day; provided that interest due with respect to such interest payment date will not accrue from and including such interest
payment date to and including the date of payment of such interest as so postponed. Interest reset dates and interest periods also are not adjusted for
non-business
days under the following unadjusted business
day convention.
•
“Modified following unadjusted business day convention” means, if an interest payment date falls on a
day that is not a business day, any payment due on such interest payment date will be postponed to the next day that is a business day; provided that interest due with respect to such interest payment date will not accrue from and including such
interest payment date to and including the date of payment of such interest as so postponed, and, provided further that, if such next succeeding business day would fall in the next succeeding calendar month, the date of payment with respect to such
interest payment date will be advanced to the business day immediately preceding such interest payment date. Interest reset dates and interest periods also are not adjusted for
non-business
days under the
modified following unadjusted business day convention.
•
“Preceding business day convention” means, if an interest payment date would otherwise fall on a day
that is not a business day, then such interest payment date will be advanced to the immediately preceding day that is a business day. If the preceding business day convention is specified in the applicable supplement to be “adjusted,”
then the related interest reset dates and interest periods also will be adjusted for
non-business
days; however, if the preceding business day convention is specified in the applicable supplement to be
“unadjusted,” then the related interest reset dates and interest periods will not be adjusted for
non-business
days.
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In all cases, unless we specify otherwise in the applicable supplement, if the maturity date
or any earlier redemption date or repayment date with respect to any note (other than a compounded SOFR note, a compounded SONIA note, a compounded CORRA note or compounded AONIA note, in each such case, using the payment delay convention) falls on
a day that is not a business day, any payment of principal and any premium, interest and other amounts otherwise due on such day will be made on the next succeeding business day, and no interest on such payment will accrue for the period from and
after such maturity date, redemption date or repayment date, as the case may be.
If no business day convention is specified in the
applicable supplement, then, with respect to any interest period during which the note bears interest at a fixed rate, the following unadjusted business day convention will apply, and, with respect to any interest period during which the note bears
interest at a floating rate, the modified following business day convention (adjusted) will apply. We also may specify and describe a different business day convention from those described above in the applicable supplement.
Unless we specify otherwise in the applicable supplement, the term “business day” means, for any note, a day that meets all the
following applicable requirements:
•
for all notes, is any weekday that is not a legal holiday in New York, New York, Charlotte, North Carolina, or
any other place of payment of the notes, and is not a date on which banking institutions in those cities are authorized or required by law or regulation to be closed;
•
for any note denominated in euro or any EURIBOR note, also is a day on which the real time gross settlement
system operated by the Eurosystem, or any successor system, or “T2,” or any successor is operating for the settlement of payments in euro (a “TARGET Settlement Date”) and also is not a legal holiday in London, England;
•
for any note denominated in Canadian dollars or any compounded CORRA note, is a day on which Schedule I banks
under the
Bank Act
(Canada) are open for business in Toronto, Ontario, other than a Saturday or a Sunday or a public holiday in Toronto (or such revised regular publication calendar for CORRA, the Compounded CORRA Index or an Applicable
Fallback Rate, as applicable, as may be adopted by the administrator of any such rates from time to time, as such terms are used in respect of CORRA) (a “Toronto banking day”);
•
for any note denominated in Australian dollars, any BBSW note or any compounded AONIA note, also is not a legal
holiday in London, England or Sydney, Australia;
•
for any compounded SOFR note or simple average SOFR note, also is not a day on which the Securities Industry and
Financial Markets Association recommends that the fixed income department of its members be closed for the entire day for purpose of trading in U.S. government securities (a “U.S. government securities business day”);
•
for any note denominated in pounds sterling or any compounded SONIA note, also is a day on which commercial banks
are open for general business (including dealing in foreign exchange and foreign currency deposits) in London (a “London banking day”); and
•
for any note that has a specified currency other than U.S. dollars, euro, Canadian dollars, Australian
dollars or pounds sterling, also is not a day on which banking institutions generally are authorized or obligated by law, regulation, or executive order to close in the principal financial center of the country of the specified currency.
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Manner of Payment
Unless otherwise stated in the applicable supplement, we will pay principal and any premium, interest, and other amounts payable on the notes
in book-entry only form in accordance with arrangements then in place between the applicable paying agent and the applicable depository. Unless otherwise stated in the applicable supplement, we will pay any interest on notes in definitive form on
each interest payment date other than the maturity date, or earlier redemption date, by, in our discretion, wire transfer of immediately available funds or check mailed to holders of the notes at the close of business on the applicable record date
at the address appearing on our or the security registrar’s records. Unless otherwise stated in the applicable supplement, we will pay any principal and any premium, interest, and other amounts payable at the maturity date, or earlier
redemption date, of a note in definitive form by wire transfer of immediately available funds to the holder of the note at the time of payment.
Payment of Additional Amounts
If we so specify in the applicable supplement, and subject to the exceptions and limitations set forth in the accompanying prospectus under
“Description of Debt Securities—Payment of Additional Amounts,” we will pay to the holder of notes that is a
“non-U.S.
person” (as defined in the accompanying prospectus under
“Description of Debt Securities—Payment of Additional Amounts”) additional amounts to ensure that every net payment on such notes will not be less, due to the payment of U.S. withholding tax, than the amount then otherwise due and
payable. For this purpose, a “net payment” on such notes means a payment by us or any paying agent, including payment of principal and interest, after deduction for any present or future tax, assessment, or other governmental charge of
the
United States (other than a territory or possession). These additional amounts will constitute additional interest on the note. For this purpose, U.S. withholding tax means a withholding tax of the United States, other than a territory or
possession.
Except as specifically provided in the accompanying prospectus under “Description of Debt Securities—Payment of
Additional Amounts,” we will not be required to make any payment of any tax, assessment, or other governmental charge imposed by any government, political subdivision, or taxing authority of that government.
If we so specify in the applicable supplement, we may redeem the notes, in whole but not in part, at any time before maturity if we have or
will become obligated to pay additional amounts as a result of a change in, or an amendment to, United States tax laws or regulations, as described in the accompanying prospectus under “Description of Debt Securities—Redemption for Tax
Reasons,” subject to any required approvals as described below under “—Redemption.”
Redemption
The applicable supplement will indicate whether we have the option to redeem notes prior to their stated maturity date. If we may
redeem the notes prior to their stated maturity date, the applicable supplement will indicate the redemption price and method for redemption. See also “Description of Debt Securities—Redemption” in the accompanying prospectus. The
redemption of any note that is our eligible long-term debt required under the rules of the Federal Reserve relating to total-loss absorbing capacity (the “TLAC Rules”) (“eligible LTD”) will require the prior approval of the
Federal Reserve if after such redemption we would fail to satisfy our requirements as to eligible LTD or total loss-absorbing capacity under the TLAC Rules. In addition, unless we specify otherwise in the applicable supplement, to the extent then
required by applicable laws or regulations, the subordinated notes may not be redeemed prior to their stated maturity date without the requisite prior approvals, if any, from applicable regulators.
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Make-Whole Redemption
If we so specify in the applicable supplement, we may, at our option, redeem the notes of a series, in whole at any time, or in part from time
to time, on or after the date that is six months after the issue date for the notes of such series as specified in the applicable supplement (or, if additional notes of such series are issued after such issue date, then on or after the date that is
six months after the issue date of such additional notes) and prior to the last day of the applicable “remaining term” of the notes of such series, upon at least five business days’ but not more than sixty (60) calendar
days’ prior written notice to the holders of such notes, at the applicable “make-whole” redemption price. If the notes of an applicable series to be so redeemed are denominated in U.S. dollars, Canadian dollars, Australian dollars
or pounds sterling, unless we specify otherwise in the applicable supplement, the applicable “make-whole” redemption price will be equal to the greater of the following applicable amounts:
(i)
100% of the principal amount of the notes being redeemed; or
(ii)
as determined by the applicable quotation agent specified below, the sum of the present values of (a) the
principal amount of the notes to be redeemed as if such amount had been paid on the last day of the applicable remaining term of the notes and (b) the scheduled payments of interest on the notes to be redeemed that would have been payable from
the applicable redemption date to the last day of the applicable remaining term of the notes, in each such case, discounted to the redemption date as follows: (1) in the case of notes denominated in currencies other than pounds sterling, on a
semi-annual basis (assuming, unless otherwise specified in the applicable supplement, (a) in the case of notes denominated in U.S. dollars or Canadian dollars, a
360-day
year consisting of twelve
30-day
months or (b) in the case of notes denominated in Australian dollars, a
365-day
year) or (2) in the case of notes denominated in pounds sterling, on an annual
basis (Actual/Actual (ICMA)), at (w) in the case of notes denominated in U.S. dollars, the treasury rate, (x) in the case of notes denominated in Canadian dollars, the GOC bond yield, (y) in the case of notes denominated in Australian
dollars, the Australian Treasury Bond Rate or the AUD Interest Rate Swaps, as specified in the applicable supplement, or (z) in the case of notes denominated in pounds sterling, the UK Government Bond (Gilt) rate, plus, in each case, the
applicable spread, if any, as may be set forth in the applicable supplement,
minus
, in each case, interest on the notes to be redeemed accrued to, but excluding, the redemption date,
plus, in either case of (i) or (ii) above, accrued and unpaid interest, if any, on the principal amount of the notes being redeemed to, but excluding,
the applicable redemption date.
We refer to such a redemption as a “make-whole redemption.”
For the purposes of determining the applicable “make-whole” redemption price for the notes of a series, the term “remaining
term” with respect to such notes, means the remaining term of such notes as if such notes matured on the date that is (1) specified as the last date of the remaining term in the applicable supplement, or (2) if no such date is so
specified, the earliest of (x) the stated maturity date of such notes, (y) if the applicable supplement provides that notes of such series also may be redeemed at a redemption price equal to 100% of the principal amount of such notes, plus
accrued and unpaid interest, if any, thereon, to, but excluding, a specified redemption date or dates, the first date on which such notes may be so redeemed or (z) in the case of a series of fixed/floating rate notes, the first date on which
interest begins to accrue on the notes at a floating rate.
The applicable supplement may set forth terms and provisions with respect to a
make-whole redemption applicable to notes denominated in a currency other than U.S. dollars, Canadian
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dollars, Australian dollars or pounds sterling. Further, the applicable supplement may set forth terms with respect to a make-whole redemption for notes denominated in a currency described above
that are different from or in addition to the terms set forth herein, in which case the terms set forth in the applicable supplement will govern.
Unless we default on payment of the applicable redemption price, interest will cease to accrue on the series of notes or portions thereof
called for redemption on the applicable redemption date. If fewer than all of the notes of any applicable series of notes are to be redeemed, for so long as such notes are in book-entry only form, such notes to be redeemed will be selected in
accordance with the procedures of (a) The Depository Trust Company, in the case of notes denominated in U.S. dollars, (b) CDS Clearing and Depository Services, Inc., in the case of notes denominated in Canadian dollars or
(c) Euroclear Bank SA/NV and Clearstream Banking S.A., in the case of notes denominated in Australian dollars or pounds sterling.
If
we redeem any notes denominated in U.S. dollars, Canadian dollars, Australian dollars or pounds sterling pursuant to a “make-whole” redemption, unless otherwise specified in the applicable supplement, BofA Securities, Inc., Merrill Lynch
Canada Inc., Merrill Lynch (Australia) Futures Limited or Merrill Lynch International, respectively, will act as quotation agent with respect thereto as provided in this section “—Make-Whole Redemption.” Because the quotation
agent, including any successor quotation agent or any other entity identified by us in the applicable supplement as a quotation agent, is expected to be our affiliate, the economic interests of such quotation agent may be adverse to the interest of
investors in notes subject to our redemption, including with respect to certain determinations and judgments it must make as quotation agent in the event that we redeem notes before maturity pursuant to the make-whole redemption described above.
Absent manifest error, all determinations of the applicable quotation agent will be final and binding on you, the trustee and us.
Unless
otherwise set forth in the applicable supplement, as used in this prospectus supplement in connection with the redemption of notes denominated in U.S. dollars, Canadian dollars, Australian dollars or pounds sterling pursuant to a make-whole
redemption, the following terms will have the respective meanings set forth below:
For Notes Denominated in U.S. Dollars:
“treasury rate” means, with respect to the applicable redemption date for the notes being redeemed, the rate per
annum equal to: (1) the yield, under the heading that represents the average for the week immediately prior to the applicable calculation date, appearing in the most recently published statistical release appearing on the website of the Federal
Reserve or in another recognized electronic source, in each case, as determined by the quotation agent in its sole discretion, and that establishes yields on actively traded U.S. Treasury securities adjusted to constant maturity, for the maturity
corresponding to the applicable comparable treasury issue; provided that, if no such maturity is within three months before or after the remaining term, yields for the two published maturities most closely corresponding to the applicable comparable
treasury issue will be determined and the applicable treasury rate will be interpolated or extrapolated from those yields on a straight-line basis, rounding to the nearest month; or (2) if such release (or any successor release) is not
published during the week immediately prior to the applicable calculation date or does not contain such yields, the semi-annual equivalent yield to maturity or interpolated maturity (on a
day-count
basis) of
the applicable comparable treasury issue, calculated using a price for the applicable comparable treasury issue (expressed as a percentage of its principal amount) equal to the related comparable treasury price for such redemption date.
The applicable treasury rate will be calculated by the quotation agent on the third business day preceding the applicable redemption date of
the relevant series of notes being redeemed.
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“comparable treasury issue” means, with respect to the applicable redemption
date for the notes being redeemed, the U.S. Treasury security or securities selected by the quotation agent as having an actual or interpolated (on a
day-count
basis) maturity comparable to the remaining term
from such redemption date of the notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining
term of such notes to be redeemed.
“comparable treasury price” means, with respect to any applicable redemption date,
(1) the average of the reference treasury dealer quotations for such redemption date, after excluding the highest and lowest reference treasury dealer quotations, provided that the quotation agent obtains five reference treasury dealer
quotations, or (2) if the quotation agent obtains fewer than five such reference treasury dealer quotations, the average of all such quotations.
“reference treasury dealer” means (1) BofA Securities, Inc., or its successor or any of our other affiliates that may be
identified as a reference treasury dealer in the applicable supplement, unless that firm ceases to be a primary U.S. government securities dealer in New York City (referred to herein as a “primary treasury dealer”), in which case we will
substitute another primary treasury dealer, and (2) four other primary treasury dealers that we may select.
“reference
treasury dealer quotations” means, with respect to each reference treasury dealer and any redemption date, the average, as determined by the quotation agent, of the bid and asked prices for the applicable comparable treasury issue (expressed
in each case as a percentage of its principal amount) quoted in writing to the quotation agent by such reference treasury dealer at 3:30 p.m., New York City time, on the third business day preceding such redemption date.
“quotation agent” means BofA Securities, Inc. or any other entity we identify as the quotation agent in the applicable supplement,
including any successor to such entity or, if that firm is unwilling or unable to select the comparable treasury issue, an investment bank of national standing appointed by us.
For Notes Denominated in Canadian Dollars
“GOC Bond Yield” means, on any date of determination, the arithmetic average of the interest rates quoted to the quotation agent
by two major Canadian registered investment dealers (that are not the quotation agent) selected by us as being the annual yield to maturity on such date, assuming semi-annual compounding, which a
non-callable
Government of Canada bond would carry, if issued in Canadian dollars in Canada, at 100% of its principal amount on the applicable redemption date with a maturity date of the final date of the remaining term of the applicable series of notes. The GOC
Bond Yield will be determined by the quotation agent as set forth above on the third business day immediately preceding the applicable redemption date.
“quotation agent” means Merrill Lynch Canada Inc. or any other entity we identify as the quotation agent in the applicable
supplement, including any successor to such entity or, if that firm is unwilling or unable to select the GOC bond yield, a Canadian investment bank appointed by us.
For Notes Denominated in Australian Dollars
“Australian treasury bond rate” means, with respect to any redemption date, (a) the rate per annum equal to the equivalent
yield to maturity as of such date of the comparable Australian treasury bond, assuming a price for the comparable Australian treasury bond (expressed as a percentage of its principal amount) equal to the comparable Australian treasury bond price for
such redemption date or (b) if the rate cannot be determined in accordance with clause (a), the rate (expressed as a yield to maturity) published by the Reserve Bank of Australia, as “Indicative Mid
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Rates of Australian Government Securities” on the Reserve Bank of Australia’s website, at or about 5:00 p.m., Sydney time, on the third business day in Sydney preceding the redemption
date, as the average of the buy and sell rates transacted on that day by authorized bond dealers for the series of Australian Commonwealth Government Treasury Bonds with a remaining term to maturity closest to the remaining term of the applicable
series of notes. The applicable Australian treasury bond rate will be calculated by the quotation agent on the third business day in Sydney preceding the redemption date.
“AUD Interest Rate Swaps” means, with respect to any redemption date, the rate (expressed as a semi-annual rate which is the
average of the “bid” rate and the “ask” rate, in each case, calculated by ICAP Australia Pty Ltd (“ICAP”) (determined using linear interpolation if necessary) calculated for the period from such redemption date to
the final date of the remaining term of the applicable series of notes as displayed on Bloomberg page “ICAP, IAUS, 34” titled ‘AUD Interest Rate Swaps’ at or around 10:00 a.m., Sydney time, three business days before such
redemption date (or if ICAP no longer calculates that rate or it is not displayed on Bloomberg, the rate determined by the calculation agent to be appropriate having regard to the market rates and sources then available). The applicable AUD Interest
Rate Swaps will be calculated by the quotation agent on the third business day in Sydney preceding the redemption date.
“comparable
Australian treasury bond” means the Australian Commonwealth Government Treasury security selected by a reference Australian treasury bond dealer as having a fixed maturity most nearly equal to the remaining term of the applicable series of
notes, and that would be utilized at the time of selection and in accordance with customary financial practice in pricing new issues of Australian dollar-denominated corporate debt securities in a principal amount approximately equal to the then
outstanding principal amount of the notes and of a comparable maturity most nearly equal to the remaining term of the applicable series of notes; provided, however, that, if the remaining term of the applicable series of notes is less than one year,
a fixed maturity of one year shall be used.
“comparable Australian treasury bond price” means, with respect to any redemption
date, the average of all reference Australian treasury bond dealer quotations for such date (which, in any event, must include at least two such quotations), after excluding the highest and lowest such reference Australian treasury bond dealer
quotations, or if fewer than four such reference Australian treasury bond dealer quotations are obtained, the average of all such quotations.
“quotation agent” means Merrill Lynch (Australia) Futures Limited, or any other entity we identify as the quotation agent in the
applicable supplement, including any successor to such entity or, if that firm is unwilling or unable to perform as described above, an investment bank of national standing appointed by us.
“reference Australian treasury bond dealer” means any authorized bond dealer appointed by us.
“reference Australian treasury bond dealer quotations” means, with respect to each reference Australian treasury bond dealer and
any redemption date, the average, as determined by the quotation agent, of the bid and offered prices for the comparable Australian treasury bond (expressed in each case as a percentage of its principal amount) quoted in writing to the quotation
agent by such reference Australian treasury bond dealer at 3:30 p.m., Sydney time, on the third business day in Sydney preceding the redemption date.
For Notes Denominated in Pounds Sterling
“UK Government Bond (Gilt) rate” means, with respect to the applicable redemption date, (1) the rate per annum equal to the
equivalent yield to maturity or interpolated yield to maturity as
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of such redemption date of the reference security, assuming a price for the reference security (expressed as a percentage of its principal amount) equal to the reference security price for such
redemption date or (2) if the rate cannot be determined in accordance with clause (1) above, the rate calculated based on averaged
mid-price
of conventional UK Government Bond (Gilt) (expressed as a
yield to maturity) published by FTSE Russell and Tradeweb (or any successor provider) at or about 6:30 p.m., London time, on the fourth London banking day preceding the redemption date for the series of conventional UK Government Bond (Gilt), in
each case with a remaining term to maturity closest to the remaining term of such notes.
“quotation agent” means Merrill
Lynch International, or any other entity we identify as the quotation agent in the applicable supplement, including any successor to such entity or, if that firm is unwilling or unable to perform as described above, an investment bank of national
standing appointed by us.
“reference security” means, as determined by the quotation agent in its sole discretion:
(i) one or more UK Government Bond (Gilt) selected by the quotation agent as having an actual or interpolated maturity comparable with the remaining term of the notes to be redeemed, being equal to the length of the period commencing on the
applicable redemption date to the last day of the applicable remaining term of the notes, or (ii) the benchmark or reference rate selected by the quotation agent that would be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities denominated in pounds sterling and having a comparable maturity to the remaining term of such notes.
“reference security price” means, with respect to any relevant redemption date, (1) the arithmetic average of reference
security dealer quotations for the related redemption date, after excluding the highest and lowest such quotations, or (2) if the reference security dealer obtains fewer than the number of quotations specified in the applicable supplement, the
arithmetic average of all such quotations.
“reference security dealer quotations” means, with respect to each reference
security dealer and any relevant redemption date, the arithmetic average, as determined by the quotation agent, of the bid and offered prices for the reference security (expressed in each case as a percentage of its nominal amount) at 6:30 p.m.,
London time, on the fourth London banking day (or such other number of business days as we specify in the applicable supplement) preceding such redemption date quoted in writing to the quotation agent by such reference security dealer.
“reference security dealers” means each of the investment banks or dealers or financial institutions we select (the number of
which to be equal to the number of reference security dealers specified in the applicable supplement), which may include the quotation agent, or our affiliates, which are (1) primary government security dealers in pounds sterling, and their
respective successors, or (2) market makers in pricing corporate bond issues denominated in pounds sterling.
Repayment at Option of Holder
The applicable supplement will indicate whether the notes can be repaid at the holder’s option prior to their stated maturity date. If
the notes may be repaid prior to their stated maturity date, the applicable supplement will indicate the amount at which we will repay the notes and the procedure for repayment. Unless we specify otherwise in the applicable supplement, to the extent
then required by applicable laws or regulations, the subordinated notes may not be repaid prior to their stated maturity date without the requisite prior approvals, if any, from applicable regulators.
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Reopenings
We have the ability to “reopen,” or increase after the issuance date, the principal amount of a particular series of our notes
without notice to the holders of existing notes by selling additional notes having the same terms. Such additional notes may be issued in one or more series and with the same or different CUSIP or other identifying number as the outstanding notes.
Any such additional notes, together with the outstanding notes, will constitute a single series of notes under the Indenture, provided that such additional notes will be issued with the same CUSIP or other identifying number as the outstanding notes
only if they are fungible with the outstanding notes for U.S. federal income tax purposes. However, any new notes of this kind may have a different offering price and may begin to bear interest at a different date.
Extendible/Renewable Notes
We may issue notes for which the maturity date may be extended at our option or renewed at the option of the holder for one or more specified
periods, up to but not beyond the final maturity date stated in the note. The specific terms of and any additional considerations relating to extendible or renewable notes will be set forth in the applicable supplement.
Other Provisions
Any provisions with respect to the determination of an interest rate basis, the specification of interest rate basis, the calculation of the
applicable interest rate or interest amounts, the amounts payable at maturity, earlier redemption or repayment, as the case may be, the interest payment dates, or any other related matters for a particular series of notes, may be modified as
described in the applicable supplement.
Repurchase
We, or our affiliates, may purchase at any time our notes by tender, in the open market at prevailing prices or in private transactions at
negotiated prices. If we purchase notes in this manner, we have the discretion to hold, resell, or cancel any repurchased notes. The repurchase of any note that is our eligible LTD will require the prior approval of the Federal Reserve if after such
repurchase we would fail to satisfy our requirements as to eligible LTD or total loss-absorbing capacity under the TLAC Rules. Unless we specify otherwise in the applicable supplement, to the extent then required by applicable laws or regulations,
the subordinated notes may not be repurchased prior to their stated maturity date without the requisite prior approvals, if any, from applicable regulators.
Form, Exchange, Registration, and Transfer of Notes
Global Notes
We
will issue each note in book-entry only form, unless otherwise specified in the applicable supplement. This means that we will not issue certificated notes in definitive form to each beneficial owner. Instead, the notes will be in the form of a
global note, in fully registered form, registered and held in the name of the applicable depository or a nominee of that depository (or, in the case of notes cleared through Euroclear and Clearstream, a nominee of a common depositary or common
safekeeper for such depository).
Depositories for Global Notes
Unless we specify otherwise in the applicable supplement, the depository for the notes denominated in U.S. dollars will be DTC. Such notes
will be registered in the name of Cede & Co.
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(DTC’s partnership nominee) or any other name as may be requested by an authorized representative of DTC and will be deposited with DTC.
Unless we specify otherwise in the applicable supplement, the depository for notes denominated in Canadian dollars will be CDS Clearing and
Depository Services Inc. (“CDS”). Such notes will be issued as one or more registered global notes initially registered in the name of CDS & CO., as nominee for CDS, and deposited with CDS.
Unless we specify otherwise in the applicable supplement, the depository for notes denominated in Australian dollars, pounds sterling or euro
will be Euroclear and/or Clearstream. Such notes may be issued either under the New Safekeeping Structure (the “NSS”) or the Classic Safekeeping Structure (the “CSS”). Notes issued under the NSS will be registered in the name
of a nominee of a common safekeeper for Euroclear and Clearstream. Notes issued under the CSS will be registered in the name of a nominee of a common depositary for Euroclear and Clearstream. The notes will be deposited with such common safekeeper
or common depositary, as applicable.
If we so specify in the applicable supplement, notes denominated in Australian dollars, pounds
sterling or euro may be issued in the form of two global notes, each in fully registered form, one of which will be registered in the name of DTC or its nominee and deposited with its custodian, and one of which will be either (i) in the case
of notes issued under the NSS, registered in the name of a nominee of a common safekeeper for Euroclear and Clearstream and deposited with such common safekeeper, or (ii) in the case of notes issued under the CSS, registered in the name of a
nominee of a common depositary for Euroclear and Clearstream and deposited with such common depositary.
DTC, CDS, Euroclear, and
Clearstream, as depositories for global securities, and some of their policies and procedures, are described under “Registration and Settlement—Depositories for Global Securities” in the accompanying prospectus. For more
information about book-entry only notes and the procedures for registration, settlement, exchange, and transfer of book-entry only notes, see “Description of Debt Securities—Form and Denomination of Debt Securities” and
“Registration and Settlement” in the accompanying prospectus.
Eurosystem Eligibility of Notes Issued Under
Euroclear/Clearstream’s New Safekeeping Structure
The European Central Bank (“ECB”) has announced that notes issued
under the NSS will be eligible as collateral for Eurosystem credit operations (“Eurosystem eligible”), provided that certain other criteria for such eligibility are met. Unless otherwise specified in the applicable supplement, notes
issued under the NSS are intended to be Eurosystem eligible, meaning that the notes are intended upon issuance to be deposited with an international central securities depository (“ICSD”) as common safekeeper, and registered in the name
of a nominee of an ICSD acting as common safekeeper for Euroclear and Clearstream, and does not necessarily mean that the notes will be recognized as eligible collateral for Eurosystem monetary policy and
intra-day
credit operations by the Eurosystem either upon issuance or at any or all times during their life. Such recognition will depend upon the ECB being satisfied that Eurosystem eligibility criteria have
been met. The ECB has published on its webpage information on its collateral eligibility criteria. Among other criteria, the information published by the ECB indicates that, effective as of February 8, 2018, unsecured debt instruments issued by
credit institutions, or their closely-linked entities, such as Bank of America Corporation, that are not established in the EU member states are not Eurosystem eligible. Therefore, as of the date of this prospectus supplement, the notes will not be
recognized as eligible collateral for Eurosystem monetary and
intra-day
credit operations. In addition, notes issued under the CSS will not be Eurosystem eligible.
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Definitive Notes
In the future, we may cancel a global note or we may issue securities initially in
non-global,
or
definitive, form. We do not expect to exchange global securities for actual notes or certificates registered in the names of the beneficial owners of the global securities representing the securities unless:
•
the depository notifies us that it is unwilling or unable to continue as depository for the global securities, or
the depository ceases to be a clearing agency registered under the Exchange Act or otherwise authorized under applicable law or regulation, and, in either case, we do not appoint a successor depositary within 90 calendar days after receiving such
notice or becoming aware of the foregoing;
•
after the original issue date of a series of notes, the depository and/or relevant clearing system has ceased to
operate as such and no alternative depositary and/or clearing system approved by the applicable holders is available; or
•
we, in our sole discretion, elect to issue definitive notes.
If we ever issue notes in definitive form, unless we specify otherwise in the applicable supplement, those notes will be in registered form,
and the exchange, registration, or transfer of those notes will be governed by the applicable Indenture and the procedures described under “Description of Debt Securities—Exchange, Registration, and Transfer” in the accompanying
prospectus.
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U.S. FEDERAL INCOME TAX CONSIDERATIONS
For the material U.S. federal income tax considerations of the acquisition, ownership and disposition of certain notes, see “U.S.
Federal Income Tax Considerations” on page 108 of the accompanying prospectus and the section “—Taxation of Debt Securities” of that section. Special U.S. federal income tax rules are applicable to certain types of notes we
may issue under this prospectus supplement. The material U.S. federal income tax considerations with respect to any notes we issue, and which are not addressed in the accompanying prospectus, will be discussed in the applicable supplement.
You should consult with your own tax advisor before investing in the notes.
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SUPPLEMENTAL PLAN OF DISTRIBUTION (CONFLICTS OF INTEREST)
We are offering the notes for sale on a continuing basis through the selling agents. The selling agents may act either on a principal
basis or on an agency basis. We may offer the notes at varying prices relating to prevailing market prices at the time of resale, as determined by the selling agents, or, if so specified in the applicable supplement, for resale at a fixed public
offering price. The applicable supplement will set forth the initial price for the notes, or whether they will be sold at varying prices.
If we sell notes on an agency basis, we will pay a commission to the selling agent to be negotiated at the time of sale. The commission will
be determined at the time of sale and will be specified in the applicable supplement. Each selling agent will use its reasonable best efforts when we request it to solicit purchases of the notes as our agent.
Unless otherwise agreed and specified in the applicable supplement, if notes are sold to a selling agent acting as principal, for its own
account, or for resale to one or more investors or other purchasers, including other broker-dealers, then any notes so sold will be purchased by that selling agent at a price equal to 100% of the principal amount of the notes less a commission that
will be a percentage of the principal amount determined as described above. Notes sold in this manner may be resold by the selling agent to investors and other purchasers from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined at the time of sale, or the notes may be resold to other dealers for resale to investors. The selling agents may allow any portion of the discount received in connection
with the purchase from us to the dealers, but the discount allowed to any dealer will not be in excess of the discount to be received by the selling agent from us. After the initial public offering of notes, the selling agent may change the public
offering price or the discount allowed to dealers.
We also may sell notes directly to investors, without the involvement of any selling
agent. In this case, we would not be obligated to pay any commission or discount in connection with the sale, and we would receive 100% of the principal amount of the notes so sold, unless otherwise specified in the applicable supplement.
We will name any selling agents or other persons through which we sell any notes, as well as any commissions or discounts payable to those
selling agents or other persons, in the applicable supplement. As of the date of this prospectus supplement, our selling agent is BofA Securities, Inc. (“BofAS”). We will enter into a distribution agreement with BofAS that describes the
offering of notes by them as our agent and as our principal. The form of distribution agreement was filed as an exhibit to the registration statement of which this prospectus supplement forms a part. We also may accept offers to purchase notes
through additional selling agents on substantially the same terms and conditions, including commissions, as would apply to purchases through BofAS under the distribution agreement. BofAS may assign its rights under the distribution agreement to
another one of our broker-dealer affiliates under the circumstances set forth in the distribution agreement. If a selling agent purchases notes as principal, that selling agent usually will be required to enter into a separate purchase agreement for
the notes, and may be referred to in that purchase agreement and the applicable supplement, along with any other selling agents, as an “underwriter.”
We have the right to withdraw, cancel, or modify the offer made by this prospectus supplement without notice. We will have the sole right to
accept offers to purchase notes, and we, in our absolute discretion, may reject any proposed purchase of notes in whole or in part. Each selling agent will have the right, in its reasonable discretion, to reject in whole or in part any proposed
purchase of notes through that selling agent.
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Unless otherwise specified in the applicable supplement, the obligations of the selling
agents under the distribution agreement, including any agreement to purchase notes, will be several and not joint. With respect to any offering of notes, the selling agents will offer the notes subject to prior sale, when, as and if issued and
accepted by them, subject to the satisfaction of conditions described in the distribution agreement and any other agreement between us and the selling agents, including any terms agreement.
Any selling agent participating in the distribution of the notes may be considered to be an underwriter, as that term is defined in the
Securities Act. We have agreed to indemnify each selling agent and certain other persons against certain liabilities, including liabilities under the Securities Act, or to contribute to payments that the selling agents may be required to make. We
also have agreed to reimburse the selling agents for certain expenses.
The notes will not have an established trading market when issued,
and we do not intend to list the notes on any securities exchange, unless otherwise specified in the applicable supplement. Any selling agent may purchase and sell notes in the secondary market from time to time. However, no selling agent is
obligated to do so, and any selling agent may discontinue making a market in the notes at any time without notice. There is no assurance that there will be a secondary market for any of the notes.
To facilitate offerings of the notes by a selling agent that purchases notes as principal, and in accordance with industry practice, selling
agents may engage in transactions that stabilize, maintain, or otherwise affect the market price of the notes. Those transactions may include overallotment, entering stabilizing bids, effecting syndicate-covering transactions, and imposing penalty
bids to reclaim selling concessions allowed to a member of the syndicate or to a dealer, as follows:
•
An overallotment in connection with an offering creates a short position in the offered securities for the
selling agent’s own account.
•
A selling agent may place a stabilizing bid to purchase a note for the purpose of pegging, fixing, or maintaining
the price of that note.
•
Selling agents may engage in syndicate-covering transactions to cover overallotments or to stabilize the price of
the notes by bidding for, and purchasing, the notes or any other securities in the open market in order to reduce a short position created in connection with the offering.
•
The selling agent that serves as syndicate manager may impose a penalty bid on a syndicate member to reclaim a
selling concession in connection with an offering when offered securities originally sold by the syndicate member are purchased in syndicate-covering transactions, in stabilization transactions, or otherwise.
In connection with any offering of the notes, we may appoint a “stabilizing manager,” in which case the stabilizing manager will
be identified in the applicable supplement. The stabilizing manager (or persons acting on its behalf), if any, may over allot notes or effect transactions with a view to supporting the market price of the applicable notes during the stabilization
period at a level higher than that which might otherwise prevail. However, stabilization action may not necessarily occur. Any stabilization action may begin on or after the date on which adequate public disclosure of the terms of the offer of the
applicable series of notes is made and, if begun, may be ended at any time, but it must end no later than 30 days after the date on which we receive the proceeds of the applicable offering of notes, or no later than 60 days after the date of
allotment of the applicable series of notes, whichever is the earlier. Any stabilization action or over allotment must be
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conducted by the stabilizing manager (or persons acting on its behalf) in accordance with all applicable laws and rules and will be undertaken at the offices of the stabilizing manager (or
persons acting on its behalf) and, if applicable, on the applicable securities exchange on which the applicable series of notes is listed (if any).
Any of these activities may stabilize or maintain the market price of the securities above independent market levels. The selling agents are
not required to engage in these activities, and may end any of these activities at any time. The stabilizing manager (if any) may conduct these activities in the
over-the-counter
market or otherwise. If the stabilizing manager (if any) commences any of these transactions, it may discontinue them at any time.
BofAS, a selling agent and one of our affiliates, is a broker-dealer and member of the Financial Industry Regulatory Authority, Inc., or
“FINRA.” Each initial offering and any remarketing of notes involving any of our broker-dealer affiliates, including BofAS, will be conducted in compliance with the requirements of FINRA Rule 5121 regarding a FINRA member firm’s
offer and sale of securities of an affiliate. None of our broker-dealer affiliates that is a FINRA member will execute a transaction in the notes in a discretionary account without specific prior written approval of the customer. For more
information, see “Plan of Distribution (Conflicts of Interest)—Conflicts of Interest” in the accompanying prospectus.
Following the initial distribution of any notes, our broker-dealer affiliates, including BofAS, may buy and sell the notes in market-making
transactions as part of their business as a broker-dealer. Resales of this kind may occur in the open market or may be privately negotiated at prevailing market prices at the time of sale. Notes may be sold in connection with a remarketing after
their purchase by one or more firms. Any of our affiliates may act as principal or agent in these transactions.
This prospectus
supplement may be used by one or more of our affiliates in connection with offers and sales related to market-making transactions in the notes, including block positioning and block trades, to the extent permitted by applicable law. Any of our
affiliates may act as principal or agent in these transactions.
Notes sold in market-making transactions include notes issued after the
date of this prospectus supplement as well as previously-issued securities. Information about the trade and settlement dates, as well as the purchase price, for a market-making transaction will be provided to the purchaser in a separate confirmation
of sale. Unless we or one of our selling agents informs you in the confirmation of sale that notes are being purchased in an original offering and sale, you may assume that you are purchasing the notes in a market-making transaction.
BofAS and other selling agents that we may name in the future, or their affiliates, have engaged, and may in the future engage, in investment
banking, commercial banking, and financial advisory transactions with us and our affiliates. These transactions are in the ordinary course of business for the selling agents and us and our respective affiliates. In these transactions, the selling
agents or their affiliates receive customary fees and expenses.
Delivery of the securities will be made against payment therefor on or
about the issue date specified in the applicable pricing supplement. Under Rule
15c6-1
of the Exchange Act trades in the secondary market generally are required to settle in two business days after the date
the securities are priced, unless the parties to any such trade expressly agree otherwise. Effective on May 28, 2024 (the “settlement cycle effective date”), the standard settlement cycle under Rule
15c6-1
will be shortened from two business days to one business day. Accordingly, if the applicable pricing supplement specifies that the issue date is more than two business days (or, on or after the
settlement cycle effective date, one business day) after the date on which the securities are priced,
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purchasers who wish to trade such securities at any time prior to the second business day (or, on or after the settlement cycle effective date, the first business day) preceding the issue date
will be required, by virtue of the fact that the securities will not settle in T+2 (or, on or after the settlement cycle effective date, T+1), to specify an alternative settlement cycle at the time of any such trade to prevent a failed settlement;
such purchasers should also consult their own advisors in this regard.
Selling Restrictions
General.
Each of the selling agents, severally and not jointly, has represented and agreed, and each further selling agent
appointed in connection with the notes will be required to represent and agree, that it has not and will not offer, sell, or deliver any note, directly or indirectly, or distribute this prospectus supplement or the accompanying prospectus, or any
other offering material relating to any of the notes, in any jurisdiction except under circumstances that will result in compliance with applicable laws and regulations and that will not impose any obligations on us except as set forth in the
distribution agreement.
Argentina.
We have not made, and will not make, any application to obtain an authorization from the
Comisión Nacional de Valores
(the “CNV”) for the public offering of the notes in Argentina. The CNV has not approved the notes, the offering, this prospectus supplement or the accompanying prospectus, or any other document
relating to the offering or issuance of the notes. The selling agents have represented and agreed, and each further selling agent appointed in connection with the notes will be required to represent and agree, that it has not offered or sold, and
will not offer or sell, any of the notes in Argentina, except in transactions that will not constitute a public offering of the notes within the meaning of Sections 2 and 83 of the Argentine Capital Markets Law No. 26,831, as amended,
supplemented or otherwise modified.
Australia.
No prospectus or other disclosure document (as defined in the Corporations
Act of 2001 (Cth) of Australia (the “Australian Corporations Act”)) in relation to the program or any notes has been, or will be, lodged with the Australian Securities and Investments Commission (“ASIC”) or the Australian
Securities Exchange operated by ASX Limited (“ASX”). Each selling agent has represented and agreed, and each further selling agent appointed in connection with the notes will be required to represent and agree, that in connection with
the distribution of the notes, that it:
(a)
has not (directly or indirectly) made or invited, and will not make or invite, an offer of the notes for issue
or sale in Australia (including an offer or invitation which is received by a person in Australia); and
(b)
has not distributed or published, and will not distribute or publish, this prospectus supplement, the
accompanying prospectus or any other offering material or advertisement relating to any notes in Australia, unless:
(i)
the aggregate consideration payable by each offeree is at least A$500,000 (or its equivalent in an alternate
currency, in either case, disregarding moneys lent by the offeror or its associates) or the offer or invitation does not otherwise require disclosure to investors under Parts 6D.2 or 7.9 of the Australian Corporations Act;
(ii)
the offer or invitation does not constitute an offer to a “retail client” as defined for the
purposes of section 761G of the Australian Corporations Act;
(iii)
such action complies with any applicable laws, regulations and directives in Australia; and
(iv)
such action does not require any document to be lodged with ASIC or the ASX.
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We are not authorized under the Banking Act 1959 of the Commonwealth of Australia (the
“Australian Banking Act”) to carry on banking business and are not subject to prudential supervision by the Australian Prudential Regulation Authority. The notes are not Deposit Liabilities under the Australian Banking Act. We do not
hold an Australian Financial Services License under Chapter 7 of the Australian Corporations Act. We are the holding company for Bank of America, N.A.
Austria
.
Any person who is in, or comes into, possession of this prospectus supplement and the accompanying prospectus
understands and acknowledges that no action has been or will be taken which would allow a public offering (
öffentliches Angebot
) of the notes in Austria unless it is in compliance with the relevant provisions of the Austrian Capital
Market Act (
Kapitalmarktgesetz
) and the EU Prospectus Regulation. The notes are being sold in Austria exclusively to qualified investors within the meaning of section 1 paragraph 1 subparagraph 6 Austrian Capital Market Act or Article 2 lit.
e) of the EU Prospectus Regulation (“qualified investors”) in reliance on the prospectus exemption set forth under the Austrian Capital Market Act or the EU Prospectus Regulation, and in accordance with Austrian securities, tax, and
other applicable laws and regulations. In particular, no prospectus within the meaning of the Austrian Capital Market Act or the EU Prospectus Regulation has been, or will be published for the sale of the notes in Austria. Accordingly, the notes may
not be offered, sold, or delivered to any person who is not a qualified investor and this prospectus supplement, the accompanying prospectus and any other offering material is directed only at qualified investors and may not be distributed or made
available to any other person in Austria. Any person who is not a qualified investor must not act or rely on this prospectus supplement and the accompanying prospectus or any of its contents. Any investment or investment activity to which this
prospectus supplement and the accompanying prospectus relate is available only to qualified investors and will be engaged in only with qualified investors. We are a U.S. bank holding company and a financial holding company. We are not a bank under
the Austrian Banking Act (
Bankwesengesetz
) and are not EU passported to perform banking business in Austria.
Bermuda.
The notes being offered hereby are being offered on a private basis to investors. This prospectus supplement and the accompanying prospectus are not subject to, and have not received approval from, either the Bermuda Monetary Authority or
the Bermuda Registrar of Companies and no statement to the contrary, explicit or implicit, is authorized to be made in this regard. The notes may be offered or sold in Bermuda only in compliance with the provisions of the Investment Business Act of
2003 of Bermuda and the Investment Funds Act 2006 of Bermuda which regulate the sale or promotion of fund interests or securities in Bermuda. Additionally,
non-Bermudian
persons (including companies) may not
carry on or engage in any trade or business in Bermuda unless such persons are permitted to do so under applicable Bermuda legislation.
Brazil.
The offer and sale of the notes have not been and will not be registered with the Brazilian Securities Commission
(
comiss
ã
o de valores mobiliários
, or “CVM”) and, therefore, will not be carried out by any means that would constitute a public offering in Brazil under CVM Resolution No 160, dated 13 July 2022, as
amended (“CVM
Resolution 160”) or unauthorized distribution under Brazilian laws and regulations. The notes will be authorized for trading on organized non-Brazilian securities markets and may only be offered to Brazilian
professional investors (as defined by applicable CVM regulation), who may only acquire the notes through a non- Brazilian account, with settlement outside Brazil in non-Brazilian currency. The trading of these notes on regulated securities markets
in Brazil is prohibited.
Canada.
Each selling agent has represented and agreed, and each further selling agent appointed in
connection with the notes will be required to represent and agree, that in connection with the distribution of the notes it will sell the notes from outside Canada solely to purchasers
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purchasing as principal that are both “accredited investors” as defined in National Instrument
45-106
Prospectus Exemptions
or
subsection 73.3(1) of the
Securities Act
(Ontario)
and “permitted clients” as defined in National Instrument
31-103
Registration Requirements, Exemptions and Ongoing Registrant
Obligations.
The People’s Republic of China.
This prospectus supplement and the accompanying prospectus,
and any other offering materials relating to the notes, have not been filed with or approved by the People’s Republic of China (for such purposes, not including Hong Kong, Macau and Taiwan) authorities, and is not an offer of securities
(whether initial public offering or private placement) within the meaning of the Securities Law 2019 or other pertinent laws and regulations of the People’s Republic of China. No person is authorized to and no person may forward or deliver
this prospectus supplement and the accompanying prospectus, or any other offering materials relating to the notes, to the general public or unspecified recipients in the People’s Republic of China. There is no open market in the People’s
Republic of China for the notes, and the notes may not be sold, transferred, offered for sale, pledged or encumbered in the People’s Republic of China unless permitted by the People’s Republic of China laws and regulations.
Prohibition of Sales to EEA Retail Investors
.
Each selling agent has represented and agreed, and each further selling
agent appointed in connection with the notes will be required to represent and agree, that it has not offered, sold or otherwise made available and will not offer, sell or otherwise make available any notes which are the subject of the offering
contemplated by this prospectus supplement and the accompanying prospectus in relation thereto to any retail investor in the EEA. For the purposes of this provision:
(a)
the expression “retail investor” means a person who is one (or more) of the following:
(i)
a retail client as defined in point (11) of Article 4(1) of MiFID II; or
(ii)
a customer within the meaning of the Insurance Distribution Directive, where that customer would not qualify as
a professional client as defined in point (10) of Article 4(1) of MiFID II; or
(iii)
not a qualified investor as defined in the EU Prospectus Regulation; and
(b)
the expression an “offer” includes the communication in any form and by any means of sufficient
information on the terms of the offer and the notes to be offered so as to enable an investor to decide to purchase or subscribe for the notes.
Denmark.
Each selling agent has represented and agreed, and each further selling agent appointed in connection with the notes
will be required to represent and agree, that it has not offered or sold and will not offer, sell or deliver any of the notes directly or indirectly in Denmark by way of a public offering, unless in compliance with, as applicable, the EU Prospectus
Regulation, the Danish Consolidated Act no. 2014 of 1 November 2021 on Capital Markets, as amended, and Executive Orders issued thereunder and in compliance with Executive Order No. 191 of 31 January 2022 on Investor Protection, as
amended, supplemented or replaced from time to time.
France.
This prospectus supplement and the accompanying
prospectus have not been approved by the
Autorité des marchés financiers
(“AMF”).
Each of the selling
agents has represented and agreed, and each further selling agent appointed in connection with the notes will be required to represent and agree, that it has offered or sold and will offer or sell, directly or indirectly, notes to the public in
France, and has distributed
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or caused to be distributed and will distribute or cause to be distributed to the public in France, this prospectus supplement and the accompanying prospectus, or any other offering material
relating to the notes, and that such offers, sales and distributions have been and will be made in France only to (a) qualified investors
(investisseurs qualifiés)
within the meaning of Article 2(e) of the EU Prospectus
Regulation, (b) a restricted group of investors (
cercle restreint d’investisseurs
) acting for their own account and/or (c) other investors in circumstances which do not require the publication by the offeror of a prospectus or
of a summary information document (
document d’information synthétique
)
pursuant to the French
Code monétaire et financier
and the
Règlement général
of the AMF all as defined in,
and in accordance with, Articles
L.411-2
and
L.411-2-1
and Articles
D.411-2
to
D.411-4
of the French
Code
monétaire et financier
, the
Règlement g
énéral of the AMF and other applicable regulations such as the EU Prospectus Regulation.
The direct or indirect resale of the notes to the public in France may be made only as provided by, and in accordance with, Articles
L.411-1,
L.411-2,
L.411-2-1
and
L.621-8
to
L.621-8-2
of the French
Code monétaire et financier
and Articles 5 and
seq.
of the EU Prospectus Regulation.
Greece.
The offer of the notes contemplated in this prospectus supplement and the accompanying prospectus has not been approved
by the Greek authorities, including the Hellenic Capital Markets Commission. The offer is addressed to qualified investors in Greece and is not addressed to the public.
We are not a bank/credit institution within the meaning of Greek law 4261/2014, but a financial holding company.
Haiti.
The offering of the notes should be limited to investors located outside of the jurisdiction of the Republic of Haiti. It
is unlawful for any person while being physically located in the jurisdiction of Haiti to offer, negotiate, sign any agreement regarding the notes to or with a client located in the jurisdiction of Haiti if such person is not licensed and/or
authorized by the Haitian Central Bank of Haiti.
Hong Kong.
In relation to each tranche of notes that we issue, each
selling agent has represented and agreed, and each further selling agent appointed in connection with the notes will be required to represent and agree, that:
(a)
it has not offered or sold and will not offer or sell in the Hong Kong Special Administrative Region of the
People’s Republic of China (“Hong Kong”), by means of any document, any notes other than (i) to “professional investors” as defined in the Securities and Futures Ordinance (Cap. 571) of Hong Kong (the
“SFO”) and any rules made under the SFO; or (ii) in other circumstances which do not result in the document being a “prospectus” as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32)
of Hong Kong (the “CWUMPO”) or which do not constitute an offer to the public within the meaning of the CWUMPO; and
(b)
it has not issued or had in its possession for the purposes of issue, and will not issue or have in its
possession for the purposes of issue, whether in Hong Kong or elsewhere, any advertisement, invitation, or document relating to the notes, which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong
(except if permitted to do so under the securities laws of Hong Kong) other than with respect to the notes which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” as defined in
the SFO and any rules made under the SFO.
Israel
.
This prospectus supplement and the accompanying
prospectus are intended solely for investors listed in the First Supplement of the Israeli Securities Law of 1968, as amended. A
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prospectus has not been prepared or filed, and will not be prepared or filed, in Israel relating to the notes offered hereunder. The notes cannot be resold in Israel other than to investors
listed in the First Supplement of the Israeli Securities Law of 1968, as amended. Subject to any applicable law, the notes offered hereunder may not be offered or sold to more than thirty-five offerees, in the aggregate, who are resident in the
State of Israel, and who are not listed in the First Supplement of the Israeli Securities Law of 1968, as amended. As a prerequisite to purchasing the notes offered under this prospectus supplement and the accompanying prospectus, investors listed
in the First Supplement of the Israeli Securities Law of 1968 may also be required to provide a written approval or evidence, as to such investor’s qualification as such and any additional eligibility as required pursuant to applicable law and
any applicable guidelines, publication or rulings issued from time to time by the Israel Securities Authority. No action will be taken in Israel that would permit an offering of the notes or the distribution of any offering document or any other
material to the public in Israel. In particular, any such offering document or other material has not been reviewed or approved by the Israel Securities Authority. Any material provided to an offeree in Israel may not be reproduced or used for any
other purpose, nor be furnished to any other person other than those to whom copies have been provided directly by us or the selling agents. Any such material shall not be transferred to any other party without our prior written consent or the prior
written consent of the selling agent(s).
Nothing in this prospectus supplement, the accompanying prospectus or any other offering
document/marketing material or other material relating to the notes, should be considered as an offer, a solicitation of an offer or the rendering of a recommendation or advice, including investment advice or investment marketing under the Law For
Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management, 1995, to purchase and/or sell any securities or financial assets, including the notes. Neither we nor the selling agents recommend, advise or express any
opinion with respect to the notes which are the subject matter of any such materials provided to an offeree, with respect to the advisability of investing in the notes, or with respect to the advisability of investment in any party affiliated
thereto.
The purchase of any note will be based on an investor’s own understanding, for the investor’s own benefit and for
the investor’s own account and not with the aim or intention of distributing or offering to other parties. In purchasing the notes, each investor declares that it has the knowledge, expertise and experience in financial and business matters so
as to be capable of evaluating the risks and merits of an investment in the notes, without relying on any of the materials provided.
Italy.
The offering of the notes has not been registered with CONSOB–
Commissione Nazionale per le Società e la
Borsa
(the Italian Companies and Exchange Commission) pursuant to Italian securities legislation and, accordingly, no such notes may be offered, sold or delivered, nor may copies of this prospectus supplement or the accompanying prospectus or of
any other document relating to the notes be distributed in the Republic of Italy except:
(a)
to qualified investors (
investitori qualificati
), as defined in Article 34-
ter
, first paragraph,
letter b), of CONSOB Regulation No. 11971 of May 14, 1999, as amended (“CONSOB Regulation No. 11971”), pursuant to Article 100 of Legislative Decree No. 58 of February 24, 1998, as amended (the “Italian
Financial Services Act”); or
(b)
in other circumstances which are exempted from the rules on offerings of securities to the public pursuant to
Article 100 of the Italian Financial Services Act and Article 34-
ter
, first paragraph, of CONSOB Regulation No. 11971.
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Any offer, sale or delivery of the notes or distribution of copies of this prospectus
supplement and the accompanying prospectus or any other document relating to such notes in the Republic of Italy under (a) or (b) above must be:
(i)
made by an investment firm, bank or financial intermediary permitted to conduct such activities in the Republic
of Italy in accordance with the Italian Financial Services Act, Legislative Decree No. 385 of September 1, 1993, as amended (the “Consolidated Banking Act”), and CONSOB Regulation No. 20307 of February 15, 2018 (as
amended from time to time);
(ii)
in compliance with Article 129 of the Consolidated Banking Act, as amended, and the implementing guidelines of
the Bank of Italy, as amended from time to time, pursuant to which the Bank of Italy may require us or any entity offering the notes to provide data and information on the issue or the offer of the notes in the Republic of Italy; and
(iii)
in compliance with any other applicable laws and regulations, as well as with any regulations or requirements
imposed by CONSOB, the Bank of Italy or other Italian authority.
Please note that in accordance with Article
100-
bis
of the Italian Financial Services Act, concerning the circulation of financial products, where no exemption from the rules on offerings of securities to the public applies under (a) and (b) above, the subsequent distribution of
the notes on the secondary market in Italy must be made in compliance with the public offer and the prospectus requirement rules provided under the Italian Financial Services Act and CONSOB Regulation No. 11971. Furthermore, Article
100-
bis
of the Italian Financial Services Act affects the transferability of the notes in the Republic of Italy to the extent that any placing of the notes is made solely with qualified investors and the notes are then systematically resold
to
non-qualified
investors on the secondary market at any time in the 12 months following such placing. Where this occurs, if a prospectus has not been published, purchasers of the notes who are acting outside
of the course of their business or profession may be entitled to declare such purchase null and void and to claim damages from any authorized intermediary at whose premises the notes were purchased, unless an exemption provided for by the Italian
Financial Services Act applies.
Japan
.
The notes have not been and will not be registered under the Financial
Instruments and Exchange Act of Japan (Act No. 25 of 1948, as amended, the “FIEA”). Each selling agent has represented, warranted and agreed, and each further selling agent or distributor appointed in respect of the notes will be
required to represent, warrant and agree, that it has not offered or sold and will not offer or sell any notes, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person or
resident in Japan, including any corporation or other entity organized under the laws of Japan) or to others for reoffering or resale, directly or indirectly, in Japan or to, or for the benefit of, a resident of Japan, except pursuant to an
exemption from the registration requirements of, and otherwise in compliance with, the FIEA and any other applicable laws, regulations, and ministerial guidelines of Japan.
If the solicitation constitutes qualified institutional investors solicitation (
tekikaku-kikan-toshika-muke-kanyu
) under Article
23-13,
Paragraph 1 of the FIEA (the “QII Solicitation”), the notes are being solicited only to qualified institutional investors (the “QIIs”) as defined in Article 10 of the Cabinet Office
Ordinance Concerning the Definition of Terms provided in Article 2 of the FIEA and the investor of any notes is prohibited from transferring such notes to any person in any way other than to QIIs. As the solicitation of offering constitutes QII
Solicitation, no securities registration statement has been or will be filed under Article 4, Paragraph 1 of the FIEA.
If the
solicitation constitutes small number of investors solicitation (
shoninzu-muke-kanyu
) under Article
23-13,
Paragraph 4 of the FIEA (the “Small Number of
Investors Solicitation”), the
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notes are being solicited only to a small number of potential investors (i.e., less than 50 offerees, except QIIs who are solicited pursuant to the QII Solicitation), and the investor of any
notes (other than the above mentioned QII investors) is prohibited from transferring such notes to another person in any way other than as a whole to one transferee unless the total number of notes is less than 50 and the notes cannot be divided
into any unit/denomination smaller than the unit/denomination represented on the note certificate therefor. As the offering constitutes Small Number of Investors Solicitation, no securities registration statement has been or will be filed under
Article 4, Paragraph 1 of the FIEA.
Luxembourg.
This prospectus supplement and the accompanying prospectus have not been
approved by and will not be submitted for approval to the Luxembourg financial sector supervisory authority (
Commission de Surveillance du Secteur Financier
) (the “CSSF”) for purposes of a public offering or sale in Luxembourg.
Accordingly, the notes may not be offered or sold to the public in Luxembourg, directly or indirectly, and neither this prospectus supplement or the accompanying prospectus, nor any other offering materials relating to the notes, form of
application, advertisement or other material related to such notes may be distributed, or otherwise be made available in or from, or published in, Luxembourg except in circumstances where the offer benefits from an exemption to or constitutes a
transaction otherwise not subject to the requirement to publish a prospectus for the purpose of the EU Prospectus Regulation and the Luxembourg law of July 16, 2019 on prospectuses for securities.
Mexico.
The notes have not been and will not be registered in the National Securities Registry (
Registro Nacional de
Valores
). Therefore, the notes may not be offered or sold in the United Mexican States (“Mexico”) by any means except in circumstances which constitute a private offering (
oferta privada
) pursuant to Article 8 of the
Securities Market Law (
Ley del Mercado de Valores
) and its regulations. All applicable provisions of the Securities Market Law must be complied with in respect to anything done in relation to the notes in, from or otherwise involving Mexico.
We are an entity incorporated pursuant to the laws of the State of Delaware, United States. Neither we nor certain of our affiliates
incorporated outside Mexico holds any authorization, permit or license issued by any Mexican governmental agency, regulator or authority in order to operate as a financial entity in Mexico or is subject to the supervision of Mexican financial
authorities.
If the acquirer or holders of the account(s) to which notes are allocated is in Mexico, each investor in the notes
represents and warrants that (i) it is either (A) an Institutional Investor (
inversionista institucional
) within the meaning of the Mexican Securities Market Law (
Ley del Mercado de valores
) or (B) a Qualified Investor
(
inversionista calificado
) within the meaning of the Mexican Securities Market Law (
Ley del Mercado de Valores
) and the regulations in effect as of the date hereof, and (ii) in the case of (A), the acquisition of the notes
complies with its applicable investment regime.
Netherlands.
We do not have an authorization from the European Central Bank
or Dutch Central Bank (
De Nederlandsche Bank N.V.
) pursuant to the Dutch Financial Supervision Act (
Wet op het financieel toezicht
, the “DFSA”) for the pursuit of the business of a credit institution in the Netherlands and
therefore do not have a license pursuant to section 2.12(1), 2.13(1) or 2.20(1) of the DFSA.
Norway.
The notes have not
been, directly or indirectly, offered or sold and will not, directly or indirectly, be offered or sold in the Kingdom of Norway other than to persons who are considered as “professional clients” as defined in MiFID II article 4 (10).
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Portugal.
The offer of notes has not been subject to approval in Portugal
under the Portuguese Securities Code approved by
Decree-Law
486/99, of November 13, 1999, as amended from time to time (
Código dos Valores Mobiliários
) and, therefore, the notes may
not be offered or sold within the Republic of Portugal or to, or for the account or benefit of, Portuguese persons except in circumstances which cannot be construed as a public offering of notes in the Republic of Portugal within the meaning of the
Portuguese Securities Code, or pursuant to any exemption from public offering rules set out in any applicable Portuguese law.
The notes
may not be offered to retail investors (as defined in the EU PRIIPs Regulation) in Portugal unless (i) any key information document required under the EU PRIIPs Regulation, the PRIIPs legal framework approved by
Decree-Law
35/2018 and the CMVM Regulation 8/2008 (collectively the “PRIIPs Rules”) is prepared and delivered to the investors, (ii) any required registration, filing, approval or recognition
of such document or any advertising material with or by the Portuguese Securities Market Commission (
Comissão do Mercado de Valores Mobiliários
) is made or obtained and (iii) compliance with all laws and regulations
applicable in Portugal to such offering is ensured.
Qatar.
This prospectus supplement and the accompanying prospectus are
provided on an exclusive basis to the specifically intended recipient (being a qualified investor as intended to be described by the Qatar Financial Markets Authority or the Qatar Financial Centre Regulatory Authority (as applicable)) in the State
of Qatar (including Qatar Financial Centre), upon that person’s request and initiative, and for the recipient’s personal use only.
Nothing in this prospectus supplement and the accompanying prospectus constitutes, is intended to constitute, shall be treated as constituting
or shall be deemed to constitute, any offer or sale of notes in the State of Qatar or in the Qatar Financial Centre or the inward marketing or promotion of notes or an attempt to do business, as a bank, an investment company or otherwise in the
State of Qatar or in the Qatar Financial Centre other than in compliance with any laws applicable in the State of Qatar or in the Qatar Financial Centre governing the issue, offering and sale of securities.
This prospectus supplement, the accompanying prospectus and the underlying notes have not been reviewed, considered, approved, registered or
licensed by the Qatar Central Bank, the Qatar Financial Centre Regulatory Authority, the Qatar Financial Markets Authority or any other regulator in the State of Qatar or the Qatar Financial Centre.
Recourse against us, the selling agents and our and their affiliates may be limited or difficult and may have to be pursued in a jurisdiction
outside Qatar and the Qatar Financial Centre.
This information is confidential and must not be reproduced in whole or in part (whether in
electronic or hard copy form). Any distribution of this prospectus supplement and accompanying prospectus by the recipient to third parties in Qatar or the Qatar Financial Centre beyond the terms hereof is not authorized and shall be at the
liability of such recipient.
Singapore.
This prospectus supplement and the accompanying prospectus have not been registered
as a prospectus with the Monetary Authority of Singapore under the Securities and Futures Act 2001, as amended or modified (the “SFA”).
Accordingly, this prospectus supplement and the accompanying prospectus, and any other document or material in connection with the offer or
sale, or invitation for subscription or purchase of the notes, may not be circulated or distributed, nor may the notes be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to
persons in Singapore other than (i) to an institutional investor (as defined in Section 4A(1)(c) of the SFA)
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pursuant to Section 274 of the SFA, (ii) to a relevant person (as defined in Section 275(2) of the SFA) pursuant to Section 275(1) of the SFA, or any person pursuant to
Section 275(1A) of the SFA, and in accordance with the conditions specified in Section 275 of the SFA and, where applicable, the conditions specified in Regulation 3 of the Securities and Futures (Classes of Investors) Regulations 2018 or
(iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.
Where the notes
are subscribed or purchased under Section 275 of the SFA by a relevant person which is:
(a)
a corporation (which is not an accredited investor (as defined in Section 4A(1)(a) of the SFA)) the sole
business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or
(b)
a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each
beneficiary of the trust is an individual who is an accredited investor,
securities (as defined in Section 2(1) of the SFA) or
securities-based derivatives contracts (as defined in Section 2(1) of the SFA) of that corporation or the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferred within six months after that
corporation or that trust has acquired the notes pursuant to an offer made under Section 275 of the SFA except:
(1)
to an institutional investor or to a relevant person or to any person arising from an offer referred to in
Section 275(1A) or Section 276(4)(c)(ii) of the SFA;
(2)
where no consideration is, or will be given, for the transfer;
(3)
where the transfer is by operation of law;
(4)
as specified in Section 276(7) of the SFA; or
(5)
as specified in Regulation 37A of the Securities and Futures (Offers of Investments) (Securities and
Securities-based Derivatives Contracts) Regulations 2018 of Singapore.
South Korea
. The notes have not
been and will not be registered under the Financial Investments Services Capital Markets Act of Korea and the decrees and regulations thereunder (the “FSCMA”) and the notes have been and will be offered in Korea as a private placement
under the FSCMA. None of the notes may be offered, sold and delivered directly or indirectly, or offered or sold to any person for
re-offering
or resale, directly or indirectly, in Korea or to any resident of
Korea except pursuant to the applicable laws and regulations of Korea, including the FSCMA and the Foreign Exchange Transaction Law of Korea and the decrees and regulations thereunder (the “FETL”). For a period of one year from the issue
date of the notes, any acquirer of the notes who was solicited to buy the notes in Korea is prohibited from transferring any of the notes to another person in any way other than as a whole to one transferee. Furthermore, the purchaser of the notes
shall comply with all applicable regulatory requirements (including but not limited to requirements under the FETL) in connection with the purchase of the notes.
Each selling agent has represented, warranted and agreed, and each further selling agent appointed in connection with the notes will be
required to represent, warrant and agree, that it has not offered, sold or delivered the notes, directly or indirectly, or offered or sold the notes to any person for
re-offering
or resale, directly or
indirectly, in Korea or to any resident of Korea and will
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not offer, sell or deliver the notes, directly or indirectly, or offer or sell the notes to any person for
re-offering
or resale, directly or indirectly,
in Korea or to any resident of Korea, except pursuant to an exemption from the registration requirements and otherwise in compliance with, the FSCMA, the FETL and other relevant laws and regulations of Korea.
Spain.
This prospectus supplement and the accompanying prospectus, and any other document related to the notes, has not been and
it is not envisaged to be approved by, registered or filed with or notified to the Spanish Securities Market Commission (
Comisión Nacional del Mercado de Valores
) or any other regulatory authority in Spain or in any other jurisdiction.
It is not intended for the public offering or sale of the notes in Spain and does not constitute a prospectus (registration document or securities note) for the public offering of the notes in Spain.
The marketing, offering, sale, subsequent resale or delivery of the notes contemplated by this prospectus supplement and the accompanying
prospectus or the distribution of this prospectus supplement and the accompanying prospectus (or any other document or copies thereto relating to the notes) in Spain shall not constitute a public offering of the notes in Spain, pursuant to the
requirements set forth by the EU Prospectus Regulation, Article 35 of the Royal Legislative Decree 4/2015 of 23 October of the Securities Markets (
Real Decreto Legislativo 4/2015, de 23 de octubre, por el que se aprueba el texto refundido de
la Ley del Mercado de Valores
), as amended and restated (the “Securities Market Act”) and Article 38 of Royal Decree 1310/2005, of 4 November, of 28 July on admission to trading of securities in official secondary markets,
public offerings and prospectus, (
Real Decreto 1310/2005, de 4 de noviembre, de 28 de julio, del Mercado de Valores, en material de admisio´n a negociación de valores en mercados secundarios oficiales, de ofertas públicas de
venta o suscripción y del folleto exigible a tales efectos
), (“RD 1310/2005”), as further amended, restated and supplemented from time to time.
Accordingly, no notes may be offered, sold, resold, delivered or marketed nor may any copies of this prospectus supplement and the
accompanying prospectus, or any other document relating to the notes, be distributed in Spain and investors in the notes may not sell or offer such notes in Spain, other than in compliance with the EU Prospectus Regulation, the Securities Markets
Act and the RD 1310/2005 and any other related legislation in force from time to time, so that any sale or offering of the notes is not classified as a public offering in Spain.
Switzerland.
This prospectus supplement and the accompanying prospectus do not constitute an offer to the public or a
solicitation to purchase or invest in the notes.
The notes have not been offered and will not be offered to the public in Switzerland,
except that offers of notes may be made to the public in Switzerland under the following exemptions under the Swiss Financial Services Act (“FinSA”):
(a)
to any person which qualifies as a professional client within the meaning of the FinSA;
(b)
to fewer than 500 persons (other than professional clients as defined under the FinSA); or
(c)
in any other circumstances falling within Article 36 FinSA in combination with Article 44 of the Swiss
Financial Services Ordinance (“FinSO”),
provided always that any such offer is conducted in a manner that it does not
require us to publish a prospectus pursuant to Article 35 FinSA.
The notes have not been and will not be listed or admitted to trading on
a trading venue in Switzerland.
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None of this prospectus supplement, the accompanying prospectus and any other offering or
marketing material relating to the notes constitutes a prospectus within the meaning of FinSA and none of this prospectus supplement, the accompanying prospectus and any other offering or marketing material relating to the notes may be publicly
distributed or otherwise made publicly available in Switzerland.
This prospectus supplement and the accompanying prospectus, and any
other offering or marketing materials in relation to the notes, are personal to each recipient and may not be publicly distributed or otherwise made publicly available in or into Switzerland.
Taiwan.
The notes are not permitted to be sold, offered or issued in Taiwan and are not permitted to be made available to Taiwan
resident investors except (i) outside Taiwan for purchase by such investors outside Taiwan; (ii) where applicable, through properly licensed intermediaries expressly permitted to make the notes available to their customers under applicable
Taiwan laws and regulations; or (iii) as otherwise permitted by applicable Taiwan law and regulations.
United Arab Emirates
(excluding the Dubai International Financial Centre and the Abu Dhabi Global Market).
The offering of the notes has not been approved or licensed by the United Arab Emirates Central Bank, the UAE Securities and Commodities Authority
(“SCA”) or any other relevant licensing authorities in the United Arab Emirates (“UAE”), and accordingly does not constitute a public offer of securities in the UAE in accordance with the commercial companies law, Federal Law
No. 2 of 2015 Concerning Commercial Companies (as amended), and SCA Resolution No. 3 R.M. of 2017 Regulating Promotions and Introductions or otherwise. Accordingly, the notes may not be offered to the public in the UAE.
This prospectus supplement and the accompanying prospectus are strictly private and confidential and are being issued to a limited number of
institutional and individual investors:
(a)
who fall within the exemptions set out in SCA Resolutions No. 9 R.M. of 2016 and No. 3 R.M. of 2017
(except natural persons) and have confirmed the same;
(b)
upon their request and confirmation that they understand that the notes have not been approved or licensed by
or registered with the UAE Central Bank, the SCA or any other relevant licensing authorities or governmental agencies in the UAE; and
(c)
must not be provided to any person other than the original recipient, and may not be reproduced or used for any
other purpose.
United Kingdom.
Prohibition of sales to UK Retail Investors.
Each selling agent has represented and agreed, and each further selling agent
appointed in connection with the notes will be required to represent and agree, that it has not offered, sold or otherwise made available and will not offer, sell or otherwise make available any notes which are the subject of the offering
contemplated by this prospectus supplement and the accompanying prospectus to any retail investor in the UK. For the purposes of this provision:
(a)
the expression “retail investor” means a person who is one (or more) of the following:
(i)
a retail client as defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as it forms part of UK
domestic law by virtue of the EUWA and the regulations made under the EUWA;
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(ii)
a customer within the meaning of the provisions of the FSMA and any rules or regulations made under the FSMA to
implement Directive (EU) 2016/97, where that customer would not qualify as a professional client as defined in point (8) of Article 2(1) of Regulation (EU) No 600/2014 as it forms part of UK domestic law by virtue of the EUWA and the
regulations made under the EUWA; or
(iii)
not a qualified investor as defined in Article 2 of UK Prospectus Regulation; and
(b)
the expression an “offer” includes the communication in any form and by any means of sufficient
information on the terms of the offer and the notes to be offered so as to enable an investor to decide to purchase or subscribe for the notes.
Other regulatory restrictions
Each selling agent has represented and agreed, and each further selling agent appointed in connection with the notes will be required to
represent and agree, that:
(a)
it has only communicated or caused to be communicated and will only communicate or cause to be communicated an
invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) received by it in connection with the issue or sale of any notes in circumstances in which section 21(1) of the FSMA does not apply to us; and
(b)
it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it
in relation to any notes in, from, or otherwise involving the UK.
Uruguay.
The notes have not been
registered under Law No. 18,627 of December 2, 2009 with the Superintendence of Financial Services of the Central Bank of Uruguay. The notes are not available publicly in Uruguay and are offered only on a private basis to institutional
investors and/or high net worth individuals only. No action may be taken in Uruguay that would render any offering of the notes a public offering in Uruguay. No Uruguayan regulatory authority has approved the notes or passed on our solvency. In
addition, any resale of the notes must be made in a manner that will not constitute a public offering in Uruguay. Investors of the notes confirm that they fully understand English and the content of this prospectus supplement and the accompanying
prospectus and any other documents provided to such investors and therefore waive the need of being provided with a translation in Spanish thereof.
Los Productos no han sido registrados de acuerdo a Ley No. 18.627 de 2 de Diciembre de 2009 ante la Superintendencia de Servicios
Financieros del Banco Central del Uruguay. Los Productos no están disponibles al público y en Uruguay solo han sido ofrecidos privadamente a inversores institucionales y/o particulares con un alto patrimonio. Ninguna acción
puede ser tomada en el Uruguay que pudiere convertir a la presente oferta en una oferta pública en el Uruguay. Ninguna autoridad regulatoria en el Uruguay ha aprobado los Productos o aprobado solvencia del Emisor. Adicionalmente, cualquier
reventa de los Productos debe ser realizada en forma que no constituya una oferta pública en el Uruguay. Los inversores del Producto confirman que comprenden cabalmente el idioma inglés y la información contenida en este
documento y cualesquiera otros documentos entregados a dichos inversores, y en consecuencia renuncian a recibir una traducción al español.
S-131
Table of Contents
LEGAL MATTERS
The legality of the notes will be passed upon for us by McGuireWoods LLP, Charlotte, North Carolina. Davis Polk & Wardwell LLP, New
York, New York or such other counsel as may be indicated in the applicable supplement will pass upon certain legal matters relating to the notes for the selling agents. McGuireWoods LLP regularly performs legal services for us.
Certain U.S. federal income tax matters will be passed upon for Bank of America by Davis Polk & Wardwell, LLP, New York, New York,
special tax counsel to Bank of America.
S-132
Table of Contents
INDEX OF CERTAIN DEFINED TERMS
Defined Term
Definition Location
€STR
S-24
30/360
S-36, S-83, S-93
Actual/360
S-83
Actual/365 (Fixed)
S-83
Actual/Actual
S-36,
S-83
Actual/Actual (Canadian Compound Method)
S-36
Actual/Actual (ICMA)
S-36,
S-93
adjusted
S-105
adjustment spread
S-56
Adjustment Spread Fixing Date
S-56
Administrator
S-56,
S-78
Administrator Recommended Rate
S-57
AFMA
S-25
AFMA Market Guidelines
S-25
AONIA
S-14,
S-48, S-57, S-76
AONIA Fallback Provisions
S-48,
S-77
AONIA Observation Period
S-57
AONIA Rate
S-57
Applicable Benchmark Rate
S-49, S-57,
S-78
Applicable Fallback Rate
S-46, S-49, S-57, S-73,
S-78
ARRC
S-9
AUD Interest Rate Swaps
S-111
Australian treasury bond rate
S-110
Bank Rate
S-43, S-68
base rate
S-37
BBSW
S-25
BBSW Fallback Provisions
S-25,
S-54
BBSW note
S-37
benchmark gilt
S-97
Benchmarks Regulations
S-23
BISL
S-57
Defined Term
Definition Location
Bloomberg Adjustment Spread
S-57
BOC Target Rate
S-46,
S-73
BoE
S-10
BofAS
S-117
business day
S-106
CAD Recommended Rate
S-46,
S-73
calculation date
S-83
Canadian paying agent
S-104
CARR
S-11
CDOR
S-11
CDS
S-114
comparable Australian treasury bond
S-111
comparable Australian treasury bond price
S-111
comparable treasury issue
S-110
comparable treasury price
S-110
compounded AONIA
S-47, S-80, S-81
compounded AONIA note
S-37
Compounded Daily AONIA
S-57
compounded CORRA
S-44,
S-74,
S-75
compounded CORRA note
S-37
compounded index
S-18
compounded notes
S-18
compounded SOFR
S-41, S-65, S-66, S-67
compounded SOFR note
S-37
compounded SONIA
S-42, S-69, S-70,
S-71
compounded SONIA note
S-37
CORRA
S-11,
S-45,
S-72
CORRA Compounded Index
S-75
CORRA Compounded Index Cessation Effective Date
S-75
S-133
Table of Contents
Defined Term
Definition Location
CORRA Compounded Index Cessation Event
S-75
CORRA Compounded Index convention
S-71,
S-74, S-75
CORRA Compounded Index End Date
S-75
CORAA Compounded Index Start Date
S-75
CSS
S-114
daily base rate
S-81,
S-82
daily rate
S-18
dealing day
S-97
Designated EURIBOR Page
S-62
DTCC
S-91
ECB
S-114
EEA
S-4
eligible LTD
S-107
EMMI
S-24
EU
S-23
EU Benchmarks Regulation
S-23
EU Prospectus Regulation
S-4
EURIBOR
S-23,
S-61
EURIBOR note
S-37
Eurosystem eligible
S-114
EUWA
S-4
Federal funds (effective) rate
S-62
federal funds (effective) rate note
S-37
FICC
S-91
Final Fallback Rate
S-49,
S-58, S-78
first reset date
S-92,
S-93
first reset interest rate
S-94
first reset period
S-94
fixed-rate notes
S-36
fixed-rate reset notes
S-92
floating-rate notes
S-5,
S-37,
S-52
Following business day convention (adjusted)
S-105
Following unadjusted business day convention
S-105
FRBNY
S-10
FSMA
S-4
Gilt Benchmark
S-98,
S-100
Defined Term
Definition Location
Gilt Benchmark Replacement
S-98
Gilt Benchmark Replacement Adjustment
S-98
Gilt Benchmark Replacement Conforming Changes
S-99
Gilt Benchmark Replacement Date
S-99
Gilt Benchmark Transition Event
S-99
Gilt Corresponding Tenor
S-100
gilt determination agent
S-97
Gilt Interpolated Benchmark
S-100
Gilt Reference Time
S-100
Gilt Relevant Governmental Body
S-100
Gilt Screen Page
S-96
GOC Bond Yield
S-110
H.15 Daily Update
S-62,
S-63, S-64, S-96
home currency
S-31
ICAP
S-111
ICSD
S-114
In Advance Base Rate
S-38
In Arrears Base Rate
S-39
Indenture
S-34
Index Cessation Effective Date
S-46,
S-73
Index Cessation Event
S-46,
S-73
index maturity
S-52
initial fixed rate period
S-93
initial interest rate
S-92
interest determination date
S-53
interest payment date
S-36,
S-40,
S-52,
S-92
interest period
S-36,
S-40,
S-53,
S-93
interest period demarcation dates
S-40
interest reset date
S-53
ISDA
S-21
ISDA Definitions
S-85
S-134
Table of Contents
Defined Term
Definition Location
ISDA Fallback Adjustment
S-85
ISDA Fallback Rate
S-85
London banking day
S-106
London paying agent
S-104
lookback convention
S-68,
S-70,
S-76,
S-81
lookback period
S-81
make-whole
S-108,
S-109
make-whole redemption
S-108
Modified following business day convention (adjusted)
S-105
Modified following unadjusted business day convention
S-105
New York banking day
S-62
Non-Representative
S-50,
S-59,
S-78
Non-USD
Benchmark
S-87,
S-88, S-90
Non-USD Benchmark Reference Time
S-90
Non-USD
Benchmark Replacement
S-88
Non-USD
Benchmark Replacement Adjustment
S-88
Non-USD
Benchmark Replacement Conforming Changes
S-89
Non-USD
Benchmark Replacement Date
S-89
Non-USD
Benchmark Transition Event
S-89
Non-USD
benchmark transition provisions
S-87
Non-USD
Corresponding Tenor
S-90
Non-USD
Interpolated Benchmark
S-90
Non-USD
Relevant Governmental Body
S-90
notes
S-3, S-22, S-39, S-52,
S-84,
S-87
Defined Term
Definition Location
NSS
S-114
observation period
S-64, S-68, S-71, S-75,
S-76
observation period convention
S-64, S-65, S-68, S-69,
S-71, S-74, S-75,
S-76,
S-80
Order
S-4
payment delay convention
S-38,
S-39,
S-105
Permanent Discontinuation Trigger
S-50, S-51, S-59, S-60,
S-79,
S-80
Permanent Fallback Effective Date
S-51,
S-60, S-79
Preceding business day convention
S-105
prime rate
S-62
prime rate note
S-37
quotation agent
S-110,
S-111,
S-112
rate
cut-off
convention
S-64,
S-66
rate
cut-off
date
S-41, S-42, S-44, S-47,
S-66,
S-82
rate lookback
S-81,
S-82
rate substitution event
S-95
RBA
S-25
RBA Recommended Fallback Rate
S-60
RBA Recommended Rate
S-51,
S-60,
S-80
reference Australian treasury bond dealer
S-111
reference Australian treasury bond dealer quotations
S-111
reference security
S-112
reference security dealer quotations
S-112
reference security dealers
S-112
reference security price
S-112
reference treasury dealer
S-110
reference treasury dealer quotations
S-110
Relevant Member State
S-4
Relevant Persons
S-4
S-135
Table of Contents
Defined Term
Definition Location
remaining term
S-108
replacement rate
S-95
repo
S-91
reset date
S-94
reset determination date
S-94
reset period
S-94
reset reference banks
S-97
reset reference rate
S-92,
S-94
Reuters page USPRIME1
S-63
SEC
S-3
senior notes
S-34
settlement cycle effective date
S-119
Simple average SOFR
S-81
simple average SOFR note
S-37
SOFR
S-9, S-42, S-65, S-67,
S-82
SOFR Administrator
S-42,
S-65,
S-82
SOFR Administrator’s Website
S-42,
S-65,
S-83
SOFR Index
S-67
SOFR Index convention
S-64,
S-67,
S-68
SOFR Index Determination Time
S-67
SOFR Index Unavailability
S-67
SOFR IndexEnd
S-67
SOFR IndexStart
S-67
SOFR Index End Date
S-67
SOFR Index Start Date
S-67
SOFR notes
S-9,
S-20
SONIA
S-10,
S-43,
S-68
SONIA Compounded Index convention
S-68,
S-70,
S-71
SONIA Compounded IndexEnd
S-70
SONIA Compounded IndexStart
S-71
SONIA Screen Page
S-44,
S-69
spread
S-39,
S-52,
S-92,
S-94
spread multiplier
S-39,
S-52
Defined Term
Definition Location
subsequent reset date
S-93
subsequent reset date(s)
S-93
subsequent reset interest rate
S-94
subsequent reset period
S-95
subordinated notes
S-34
Supervisor
S-51, S-60,
S-80
Supervisor Recommended Rate
S-60
Sydney banking day
S-51, S-60, S-80
TARGET Settlement Date
S-106
Temporary Disruption Trigger
S-61
TLAC Rules
S-107
Toronto Banking Day
S-106
treasury (auction) rate
S-63
treasury (auction) rate note
S-37
treasury rate
S-109
trustee
S-34
UK
S-5
UK Prospectus Regulation
S-4
U.S. government securities business day
S-106
U.S. Treasury Rate
S-95
U.S. Treasury Rate adjustments
S-96
UK Benchmarks Regulation
S-23
UK Government Bond (Gilt) Rate
S-96, S-111
unadjusted
S-105
Unadjusted Gilt Benchmark Replacement
S-100
Unadjusted
Non-USD
Benchmark Replacement
S-91
Unadjusted USD Benchmark Replacement
S-87
USD Benchmark
S-85
S-136
Table of Contents
Defined Term
Definition Location
USD Benchmark Reference Time
S-87
USD Benchmark Replacement
S-85
USD Benchmark Replacement Adjustment
S-85
USD Benchmark Replacement Conforming Changes
S-86
USD Benchmark Replacement Date
S-86
Defined Term
Definition Location
USD Benchmark Transition Event
S-86
USD benchmark transition provisions
S-84
U.S. Dollar LIBOR
S-9
USD Relevant Governmental Body
S-87
S-137
Table of Contents
PROSPECTUS
$160,000,000,000
Debt Securities, Warrants, Units, Purchase Contracts,
Preferred Stock, Depositary Shares, and Common Stock
We
from time to time may offer to sell up to $160,000,000,000, or the equivalent thereof in any other currency, of our debt securities, warrants, purchase contracts, preferred stock, depositary shares representing fractional interests in our preferred
stock, and common stock, as well as units comprised of one or more of these securities, in any combination. The debt securities, warrants, purchase contracts, and preferred stock may be convertible into or exercisable or exchangeable for our common
or preferred stock. Our common stock is listed on the New York Stock Exchange under the symbol “BAC.” The other securities that we may offer from time to time using this prospectus may be listed on the New York Stock Exchange or may be
listed or quoted on another securities exchange or quotation system, as specified in the applicable supplement.
This prospectus provides a general
description of the securities and the manner in which they will be offered. The securities may be offered for sale from time to time in amounts, on terms and at prices as shall be determined in connection with such offer and sale. These terms and
prices will be described in one or more supplements to this prospectus. When we sell a particular issue of securities, we will provide one or more supplements to this prospectus describing the offering and the specific terms of those securities. You
should read this prospectus and any applicable supplement carefully before you invest in the securities.
We will use this prospectus in the initial sale
of the securities. In addition, BofA Securities, Inc., or any of our other broker-dealer affiliates, may use this prospectus in a market-making transaction in any of the securities after their initial sale. Unless you are informed otherwise in the
confirmation of sale, this prospectus is being used in a market-making transaction.
Potential purchasers of our securities should consider the
information set forth in the “
Risk Factors
” section beginning on page 8.
The securities are unsecured and
are not savings accounts, deposits, or other obligations of a bank, are not guaranteed by Bank of America, N.A. or any other bank, are not insured by the Federal Deposit Insurance Corporation or any other governmental agency, and may involve
investment risks.
None of the Securities and Exchange Commission, any state securities commission, or any other regulatory body has approved or
disapproved of the securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
Prospectus dated March 28, 2024
Table of Contents
TABLE OF CONTENTS
Page
Prospectus
About this Prospectus
3
Prospectus Summary
4
Risk Factors
8
Risks Relating to Regulatory Resolution Strategies and Long-Term Debt Requirements
8
Risks Relating to Debt Securities Generally
9
Risks Relating to Our Common Stock and Preferred Stock
12
Other Risks
14
Bank of America Corporation
16
Use of Proceeds
16
Description of Debt Securities
17
General
17
Financial Consequences to Unsecured Debtholders of Single Point of Entry Resolution
Strategy
17
The Indentures
18
Form and Denomination of Debt Securities
19
Payment for
Non-U.S.
Dollar-Denominated
Debt Securities
19
Different Series of Debt Securities
20
Types of Debt Securities
21
Calculation Agents for Certain Types of Debt Securities
22
Original Issue Discount Notes
22
Payment of Principal, Interest, and Other Amounts Payable
22
No Sinking Fund
27
Redemption
27
Repayment
28
Repurchase
28
Conversion
28
Exchange, Registration, and Transfer
28
Subordination
29
Sale or Issuance of Capital Stock of Principal Subsidiary Bank
30
Limitation on Mergers and Sales of Assets
31
Waiver of Covenants
31
Modification of the Indentures
31
Meetings and Action by Securityholders
32
Events of Default and Rights of Acceleration; Covenant Breaches
32
Collection of Indebtedness and Suits for Enforcement by Trustee
33
Limitation on Suits
33
Payment of Additional Amounts
34
Redemption for Tax Reasons
37
Defeasance and Covenant Defeasance
38
Satisfaction and Discharge of the Indenture
39
Notices
39
Concerning the Trustee
39
Governing Law
39
Description of Warrants
40
General
40
Description of Securities Warrants
40
Description of Index Warrants
41
Description of Currency Warrants
41
Modification
42
Enforceability of Rights of Warrantholders, No Trust Indenture Act Protection
42
Description of Purchase Contracts
43
General
43
Purchase Contract Property
43
Information in Supplement
43
Prepaid Purchase Contracts; Applicability of Indenture
44
Page
Non-Prepaid
Purchase Contracts; No Trust
Indenture Act Protection
45
Pledge by Holders to Secure Performance
45
Settlement of Purchase Contracts that Are Part of Units
45
Failure of Holder to Perform Obligations
46
Description of Units
47
General
47
Unit Agreements: Prepaid,
Non-Prepaid,
and
Other
48
Modification
48
Enforceability of Rights of Unitholders; No Trust Indenture Act
Protection
48
Description of Preferred Stock
50
General
50
Dividends
51
Voting
51
Liquidation Preference
51
Preemptive Rights
51
Existing Preferred Stock
52
Additional Classes or Series of Stock
92
Description of Depositary Shares
93
General
93
Form of the Depositary Shares
93
Withdrawal of Preferred Stock
93
Dividends and Other Distributions
94
Redemption of Depositary Shares
94
Voting the Deposited Preferred Stock
94
Amendment and Termination of the Deposit Agreement
95
Charges of Depository
95
Miscellaneous
95
Resignation and Removal of Depository
95
Description of Common Stock
96
General
96
Voting and Other Rights
96
Dividends
96
Certain Anti-Takeover Matters
97
Registration and Settlement
98
Book-Entry Only Issuance
98
Definitive Securities
98
Street Name Owners
99
Legal Holders
99
Special Considerations for Indirect Owners
99
Depositories for Global Securities
100
Special Considerations for Global Securities
105
U.S. Federal Income Tax Considerations
108
Taxation of Debt Securities
109
Taxation of Common Stock, Preferred Stock, and Depositary
Shares
124
Taxation of Warrants
129
Taxation of Purchase Contracts
129
Taxation of Units
129
Reportable Transactions
130
Foreign Account Tax Compliance Act
130
Plan of Distribution (Conflicts of Interest)
132
Distribution Through Underwriters
132
Distribution Through Dealers
133
Distribution Through Agents
133
Direct Sales
133
General Information
133
Market-Making Transactions by Affiliates
134
Conflicts of Interest
134
ERISA Considerations
136
Where You Can Find More Information
138
Forward-Looking Statements
139
Legal Matters
140
Experts
140
2
Table of Contents
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or the “SEC,”
utilizing a “shelf” registration process. Under this shelf process, we may, from time to time, sell any type of the securities described in this prospectus or the registration statement in one or more offerings.
This prospectus provides you with a general description of the securities we may offer and the manner in which they will be offered. Each time
we offer and sell securities, we will provide one or more prospectus supplements and/or pricing supplements that describe the particular securities offering and the specific terms and provisions of the securities being offered. These documents also
may add, update, or change information contained in this prospectus. In this prospectus, when we refer to the “applicable supplement,” we mean the prospectus supplement or supplements, as well as any applicable pricing or other
supplements, that describe the particular securities being offered to you. If there is any inconsistency between the information in this prospectus and the applicable supplement, you should rely on the information in the applicable supplement.
The information in this prospectus is not complete and may be changed. We have not authorized anyone to provide any information other than
information provided in or incorporated by reference in this prospectus and the applicable supplement. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may provide. We are not
making an offer of the securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus and the applicable supplement, as well as information we have filed or will file with
the SEC and incorporated by reference in this prospectus, is accurate only as of the date of the applicable document or other date referred to in that document. Our business, financial condition, and results of operations may have changed since that
date.
Capitalized or other terms used and defined in this prospectus are sometimes defined after their first use without a reference such
as “as defined in this prospectus.”
Unless we indicate otherwise or unless the context requires otherwise, all references in
this prospectus to “Bank of America,” “we,” “us,” “our,” or similar references are to Bank of America Corporation excluding its consolidated subsidiaries.
References in this prospectus to “$,” “dollars” and “U.S. dollars” are to the currency of the United
States of America; references to “Canadian dollars” are to the currency of Canada; and references in this prospectus to “euro” are to the currency introduced at the start of the third stage of the European Economic and
Monetary Union pursuant to Article 109g of the Treaty establishing the European Community, as amended from time to time.
3
Table of Contents
PROSPECTUS SUMMARY
This summary section provides a brief overview of material terms of the securities we may offer and highlights other selected information from
this prospectus. This summary does not contain all the information that you should consider before investing in the securities we may offer using this prospectus. To fully understand the securities we may offer, you should read carefully:
•
this prospectus, which provides a general description of the securities we may offer and the manner in which they
will be offered;
•
the applicable supplement, which describes the specific terms of the particular securities we are offering and
the offering, and which may update or change the information in this prospectus; and
•
the documents we refer to in “Where You Can Find More Information” below for information about us,
including our financial statements.
Bank of America Corporation
Bank of America Corporation is a Delaware corporation, a bank holding company, and a financial holding company. Through our various bank and
nonbank subsidiaries throughout the United States and in international markets, we provide a diversified range of banking and nonbank financial services and products. Our principal executive offices are located in the Bank of America Corporate
Center, 100 North Tryon Street, Charlotte, North Carolina 28255 and our telephone number is (704)
386-5681.
The Securities We May Offer
We may use
this prospectus to offer up to $160,000,000,000, or the equivalent thereof in any other currency, of any of the following of our securities from time to time:
•
debt securities;
•
warrants;
•
purchase contracts;
•
preferred stock;
•
depositary shares representing fractional interests in our preferred stock;
•
common stock; and
•
units, comprised of one or more of any of the securities referred to above, in any combination.
When we use the term “securities” in this prospectus, we mean any of the securities we may offer using this
prospectus, unless we specifically state otherwise. This prospectus, including this summary, describes general terms of the securities we may offer. Each time we sell securities, we will provide you with the applicable supplement that will describe
the offering and the specific terms of the securities being offered. The applicable supplement may include a discussion of additional U.S. federal income tax consequences and any additional risk factors or other special considerations applicable to
those particular securities.
4
Table of Contents
Debt Securities
Our debt securities may be either senior or subordinated obligations in right of payment. Our senior and subordinated debt securities will be
issued under separate indentures that we have with a trustee. The particular terms of each series of debt securities that we offer using this prospectus will be described in the applicable supplement.
Warrants
We may offer warrants,
including:
•
warrants for the purchase of our debt securities, common stock or preferred stock;
•
warrants entitling the holders thereof to receive from us, upon exercise, an amount in cash determined by
reference to decreases or increases in the level of a specific index or in the levels (or relative levels) of two or more indices or combinations of indices, which index or indices may be based on one or more stocks, bonds or other securities, one
or more currencies or currency units, or any combination of the foregoing; and
•
warrants entitling the holders thereof to receive from us, upon exercise, an amount in cash determined by
reference to decreases or increases in the price or level (or relative price, level or exchange rate) of specified amounts of one or more currencies or currency units.
We will issue warrants under warrant agreements that we will enter into with one or more warrant agents. For any warrants we may offer, we
will describe in the applicable supplement the specific terms of the warrants and the applicable warrant agreement.
Purchase Contracts
We may offer purchase contracts for the purchase of, or whose cash value is determined by reference to the performance, level, or value of,
our common or preferred stock or other securities described in this prospectus, a basket of securities or any combination of the foregoing.
For any purchase contracts we may offer, we will describe in the applicable supplement the underlying property, the settlement date, the
purchase price, or manner of determining the purchase price, and whether it must be paid when the purchase contract is issued or at a later date, the amount and kind, or manner of determining the amount and kind, of property to be delivered at
settlement, whether the holder will pledge property to secure the performance of any obligations the holder may have under the purchase contract, and any other specific terms of the purchase contracts.
Units
We may offer units consisting of
one or more securities described in this prospectus, in any combination. For any units we may offer, we will describe in the applicable supplement the particular securities that comprise each unit, whether or not the particular securities will be
separable and, if they will be separable, the terms on which they will be separable, a description of the provisions for the payment, settlement, transfer, or exchange of the units, and any other specific terms of the units. We will issue units
under unit agreements that we will enter into with one or more unit agents.
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Preferred Stock and Depositary Shares
We may offer our preferred stock in one or more series. For any particular series we may offer, we will describe in the applicable supplement:
•
the specific designation;
•
the aggregate number of shares offered;
•
the dividend rate and periods, or manner of calculating the dividend rate and determining the dividend periods,
if any;
•
the stated value and liquidation preference amount, if any;
•
the voting rights, if any;
•
the terms on which the series of preferred stock is convertible into shares of our common stock, preferred stock
of another series, or other securities, if any;
•
the redemption terms, if any; and
•
any other specific terms of the series.
We also may offer depositary shares, each of which will represent a fractional interest in a share or multiple shares of our preferred stock.
We will describe in the applicable supplement any specific terms of the depositary shares. We will issue the depositary shares under deposit agreements that we will enter into with one or more depositories.
Form of Securities
Unless we specify
otherwise in the applicable supplement, we will issue the securities in book-entry only form through one or more depositories, such as The Depository Trust Company, Euroclear Bank SA/NV, Clearstream Banking S.A., Luxembourg, or CDS Clearing and
Depository Services Inc., as identified in the applicable supplement. We will issue the securities only in registered form, without coupons, although we may issue the securities in bearer form if we so specify in the applicable supplement. The
securities issued in book-entry only form will be uncertificated or will be represented by a global security registered in the name of the specified depository or its nominee (unless otherwise specified in the applicable supplement), rather than
certificated securities in definitive form registered in the name of each individual owner. Unless we specify otherwise in the applicable supplement, each sale of securities in book-entry only form will settle in immediately available funds through
the specified depository.
A global security may be exchanged for certificated securities in definitive form registered in the names of
the beneficial owners only under the limited circumstances described in this prospectus.
Payment Currencies
All amounts payable in respect of the securities, including the purchase price, will be payable in U.S. dollars, unless we specify
another currency for payment of such amounts in the applicable supplement.
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Listing
We will state in the applicable supplement whether the particular securities that we are offering will be listed or quoted on a securities
exchange or quotation system.
Distribution
We may offer the securities using this prospectus:
•
through underwriters;
•
through dealers;
•
through agents; or
•
directly to purchasers.
The applicable supplement will include any required information about the firms we use and the discounts or commissions we may pay them for
their services.
BofA Securities, Inc., or any of our other broker-dealer affiliates, may be an underwriter, dealer or agent for us.
Market-Making by Our Affiliates
Following the initial distribution of an offering of securities, BofA Securities, Inc., and other broker-dealer affiliates of ours, may offer
and sell those securities in the course of their businesses as broker-dealers. BofA Securities, Inc. and any such other broker-dealer affiliates may act as a principal or agent in these transactions. This prospectus and the applicable supplement
also will be used in connection with these market-making transactions. Sales in any of these market-making transactions will be made at varying prices related to prevailing market prices and other circumstances at the time of sale.
If you purchase securities in a market-making transaction, you will receive information about the purchase price and your trade and settlement
dates in a separate confirmation of sale.
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RISK FACTORS
This section summarizes some specific risks and investment considerations with respect to an investment in our securities. This summary
does not describe all of the risks and investment considerations with respect to an investment in our securities, including risks and considerations relating to a prospective investor’s particular circumstances. For information regarding risks
and uncertainties that may materially affect our business and results, please refer to the information under the caption “Item 1A. Risk Factors” in our annual report on
Form 10-K
for the
year ended December 31, 2023, which is incorporated by reference in this prospectus, as well as those risks and uncertainties discussed in our subsequent filings that are incorporated by reference in this prospectus. You also should review the
risk factors that will be set forth in any applicable supplement for a particular offering of securities. Prospective investors should consult their own financial, legal, tax, and other professional advisors as to the risks associated with an
investment in our securities and the suitability of the investment for the investor.
Risks Relating to Regulatory
Resolution Strategies and Long-Term Debt Requirements
A resolution under our single point of entry resolution strategy could materially adversely
affect our liquidity and financial condition and our ability to pay our obligations on our securities.
We are required periodically
to submit a plan to the Federal Deposit Insurance Corporation (“FDIC”) and the Board of Governors of the Federal Reserve System (“Federal Reserve”) describing our resolution strategy under the U.S. Bankruptcy Code in the
event of material financial distress or failure. Our preferred resolution strategy is a single point of entry (“SPOE”) strategy, whereby only Bank of America (the parent holding company) would file for bankruptcy under the U.S.
Bankruptcy Code. Certain key operating subsidiaries would be provided with sufficient capital and liquidity to operate through severe stress and to enable such subsidiaries to continue operating or be wound down in a solvent manner following a Bank
of America bankruptcy. We have entered into intercompany arrangements governing the contribution of most of our capital and liquidity to these key subsidiaries. As part of these arrangements, we have transferred most of our assets (and have agreed
to transfer additional assets) to a wholly-owned holding company subsidiary in exchange for a subordinated note. Certain of our remaining assets secure our ongoing obligations under these intercompany arrangements. The wholly-owned holding company
subsidiary also has provided us with a committed line of credit that, in addition to our cash, dividends and interest payments, including interest payments we receive in respect of the subordinated note, may be used to fund our obligations. These
intercompany arrangements include provisions to terminate the line of credit and forgive the subordinated note and require us to contribute our remaining financial assets to the wholly-owned holding company subsidiary if our projected liquidity
resources deteriorate so severely that our resolution becomes imminent, which could adversely affect our liquidity and ability to meet our obligations on our securities. In addition, our preferred resolution strategy could result in holders of our
securities being in a worse position and suffering greater losses than would have been the case under a bankruptcy proceeding or other resolution scenarios or plans.
Under Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Financial Reform Act”), when a
global systemically important banking organization
(“G-SIB”),
such as Bank of America, is in default or danger of default, the FDIC may be appointed receiver to conduct an orderly liquidation and
could, among other things, invoke the orderly liquidation authority, instead of the U.S. Bankruptcy Code, if the Secretary of the U.S. Department of Treasury makes certain financial distress and systemic risk determinations. Additionally, the FDIC
could replace Bank of America with a bridge holding company, which could continue operations and result in an orderly resolution of the underlying bank, but whose equity would be held solely for the benefit of our creditors. The FDIC’s
“single point of entry” strategy may result in
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holders of our securities suffering greater losses than would have been the case under a bankruptcy proceeding or a different resolution strategy. If Bank of America is resolved under the U.S.
Bankruptcy Code or the FDIC’s orderly liquidation authority, third-party creditors of our subsidiaries may receive significant or full recoveries on their claims, while holders of Bank of America’s securities could face significant or
complete losses.
If we enter a resolution proceeding, holders of our debt securities and equity securities would be at risk of absorbing our losses.
If we enter a resolution proceeding under either the U.S. Bankruptcy Code or Title II of the Financial Reform Act, our losses would
be imposed first on holders of our equity securities and thereafter on holders of our unsecured debt, including our debt securities, and some or all of such securities could be significantly reduced or eliminated as a result of such resolution
proceeding.
Under our SPOE resolution strategy, and the single point of entry strategy preferred by the FDIC under Title II of the
Financial Reform Act, the value that would be distributed to holders of our unsecured debt, including our debt securities, may not be sufficient to repay all or part of the principal amount and interest on such debt, and holders of such debt could
receive no consideration at all under these resolution scenarios. Either of these resolution strategies could result in holders of our debt securities being in a worse position and suffering greater losses than would have been the case under a
different resolution strategy. Although SPOE is our preferred resolution strategy, neither Bank of America nor a bankruptcy court would be obligated to follow our SPOE strategy. Additionally, the FDIC is not obligated to follow its SPOE strategy to
resolve Bank of America under Title II of the Financial Reform Act. For more information regarding the financial consequences of any such resolution proceeding, see “Description of Debt Securities—Financial Consequences to Unsecured
Debtholders of Single Point of Entry Resolution Strategy” below.
We are subject to the Federal Reserve’s final rules requiring U.S.
G-SIBs
to maintain minimum amounts of long-term debt meeting specified eligibility requirements.
Under the rules of the Federal Reserve relating to total loss-absorbing capacity (the “TLAC Rules”), we, as a U.S.
G-SIB,
are required to, among other things, maintain minimum amounts of unsecured external long-term debt satisfying certain eligibility criteria (“eligible LTD”) and other loss-absorbing capacity for
the purpose of absorbing our losses in a resolution proceeding under either the U.S. Bankruptcy Code or Title II of the Financial Reform Act. Any senior long-term debt must include terms required by the TLAC Rules in order to qualify as eligible
LTD. Actions required to comply with the TLAC Rules could impact our funding and liquidity risk management plans.
Risks
Relating to Debt Securities Generally
Our obligations on the debt securities will be structurally subordinated to liabilities of our subsidiaries.
Because we are a holding company, our right to participate in any distribution of assets of any subsidiary upon such
subsidiary’s liquidation or reorganization or otherwise is subject to the prior claims of creditors of that subsidiary, except to the extent we may ourselves be recognized as a creditor of that subsidiary. As a result, our obligations under
the debt securities will be structurally subordinated to all existing and future liabilities of our subsidiaries, and claimants should look only to our assets for payments. Further, creditors of subsidiaries recapitalized pursuant to our resolution
plan generally would be entitled to payment of their claims from the assets of the subsidiaries, including our contributed assets. In addition, our debt securities will be unsecured and, therefore, in a bankruptcy or similar proceeding, will
effectively rank junior to our secured obligations to the extent of the value of the assets securing such obligations.
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Holders of our debt securities could be at greater risk for being structurally subordinated if we sell or
convey all or substantially all of our assets to one or more of our majority-owned subsidiaries.
We may sell, convey or transfer all
or substantially all of our assets to one or more entities that are direct or indirect majority-owned subsidiaries of ours in which we or one or more of our subsidiaries owns more than 50% of the combined voting power, and under the indentures under
which the debt securities will be issued, such subsidiary or subsidiaries will not be required to assume our obligations under such debt securities, and we will remain the sole obligor on such debt securities. In such event, creditors of any such
subsidiary or subsidiaries would have additional assets from which to recover on their claims while holders of our debt securities would be structurally subordinated to creditors of such subsidiary or subsidiaries with respect to such transferred
assets. See “Description of Debt Securities—Limitation on Mergers and Sales of Assets” below for more information.
Events for which
acceleration rights under our senior debt securities may be exercised are more limited than those available pursuant to the terms of our outstanding senior debt securities issued prior to January 13, 2017.
In response to the TLAC Rules, on January 13, 2017, we modified the terms of our senior debt securities to be issued on or after that
date to, among other things, limit the circumstances under which the payment of the principal amount of such senior debt securities can be accelerated (unless specified otherwise in the applicable supplement).
All or substantially all of our outstanding senior debt securities issued prior to January 13, 2017 (the
“Pre-2017
Senior Debt Securities”) provide acceleration rights for nonpayment or bankruptcy. The
Pre-2017
Senior Debt Securities also provide acceleration
rights if we default in the performance of our covenants in those debt securities or the applicable indenture under which those securities were issued. In addition, the
Pre-2017
Senior Debt Securities do not
require a
30-day
cure period before a nonpayment of principal becomes an event of default and acceleration rights become exercisable with respect to such nonpayment.
However, under the Senior Indenture (as defined below), unless we specify otherwise in the applicable supplement, payment of the principal
amount of our senior debt securities issued under such indenture:
•
may be accelerated only (i) if we default in the payment of the principal of or interest on those senior
debt securities and, in each case, the default continues for a period of 30 days, or (ii) upon our voluntary or involuntary bankruptcy and, in the case of our involuntary bankruptcy, the event continues for a period of 60 days; and
•
may not be accelerated if we default in the performance of any other covenants contained in such senior debt
securities or the Senior Indenture.
As a result of these differing provisions, if we breach or otherwise default in the
performance of a covenant (other than a payment covenant) that applies both to senior debt securities that we issued on or after January 13, 2017 and the
Pre-2017
Senior Debt Securities, the
Pre-2017
Senior Debt Securities would have acceleration rights that would not be available to the holders of our other senior debt securities. In addition, if we fail to pay principal when due with respect to our
senior debt securities issued on or after on or after January 13, 2017 and the
Pre-2017
Senior Debt Securities, an event of default would occur immediately with respect to the
Pre-2017
Senior Debt Securities (and the exercise of acceleration rights could proceed immediately in accordance with the
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provisions of the indenture under which those debt securities were issued), while the holders of our other senior debt securities must wait for the
30-day
cure period to expire before such nonpayment of principal becomes an event of default and any acceleration rights are triggered with respect to such nonpayment. Any repayment of the principal amount of
Pre-2017
Senior Debt Securities following the exercise of acceleration rights in circumstances in which such rights are not available to the holders of our other senior debt securities (including our debt
securities offered by this prospectus) could adversely affect our ability to make timely payments on such other senior debt securities thereafter.
The
market value of the debt securities may be less than the principal amount of the debt securities.
The market for, and market value
of, the debt securities may be affected by a number of factors. These factors include:
•
the method of calculating the principal of or any premium, interest or other amounts payable on the debt
securities;
•
the time remaining to maturity of the debt securities;
•
the aggregate amount outstanding of the relevant debt securities;
•
any redemption or repayment features of the debt securities;
•
the level, direction, and volatility of market interest rates generally;
•
general economic conditions of the capital markets in the United States;
•
geopolitical conditions and other financial, political, regulatory and judicial events that affect the financial
markets generally; and
•
any market-making activities with respect to the debt securities.
Often, the only way to liquidate your investment in the debt securities prior to maturity will be to sell the debt securities. At that time,
there may be a very illiquid market for the debt securities or no market at all. If you sell your debt securities prior to maturity, you may receive less than the principal amount of such debt securities.
Acceleration rights for our subordinated debt securities are available only in limited circumstances.
The rights of acceleration under our subordinated debt securities are more limited than those available pursuant to the terms of our senior
debt securities. Unless we specify otherwise in the applicable supplement, the payment of principal of our subordinated debt securities may be accelerated only in the event of our voluntary or involuntary bankruptcy under U.S. federal bankruptcy
laws (and, in the case of our involuntary bankruptcy, such event continues for a period of 60 days). If you purchase any subordinated debt securities, you will have no right to accelerate the payment of principal of the subordinated debt securities
if we fail to pay principal or interest when due on those subordinated debt securities or if we fail in the performance of any of our other obligations under those subordinated debt securities.
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Our obligations under subordinated debt securities will be subordinated.
Holders of our subordinated debt securities should recognize that contractual provisions in the Subordinated Indenture (as defined below) may
prohibit us from making payments on the subordinated debt securities. The subordinated debt securities are unsecured and subordinate and junior in right of payment to all of our senior indebtedness (as defined in the Subordinated Indenture), to the
extent and in the manner provided in the Subordinated Indenture. In addition, the subordinated debt securities may be fully subordinated to interests held by the U.S. government in the event we enter into a receivership, insolvency, liquidation or
similar proceedings, including a proceeding under Title II of the Financial Reform Act. For additional information regarding the subordination provisions applicable to the subordinated debt securities, see “Description of Debt
Securities—Subordination” below.
Redemption of our debt securities prior to maturity may result in a reduced return on your investment.
The terms of our debt securities may permit or require redemption of the debt securities prior to maturity. That redemption may occur
at a time when prevailing interest rates are relatively low. As a result, a holder of the redeemed debt securities may not be able to invest the redemption proceeds in a new investment that yields a similar return.
Risks Relating to Our Common Stock and Preferred Stock
Our ability to pay dividends on our common stock and preferred stock may be limited by regulatory policies and requirements.
We are subject to various regulatory policies and requirements relating to capital actions, including payment of dividends. For instance,
Federal Reserve regulations require major U.S. bank holding companies to submit a capital plan as part of an annual Comprehensive Capital Analysis and Review (“CCAR”). Our ability to pay dividends depends in part on our ability to
maintain regulatory capital levels above minimum requirements plus buffers. To the extent that the Federal Reserve increases our stress capital buffer (“SCB”), G-SIB surcharge or countercyclical capital buffer, our ability to pay or
increase dividends could be limited. As part of its annual CCAR, we are subject to extensive regulatory evaluation of capital planning practices by the Federal Reserve, including stress testing on parts of our business using hypothetical economic
scenarios prepared by the Federal Reserve. Those scenarios may affect our CCAR stress test results, which may impact our SCB level, requiring us to hold additional capital or causing changes in required capital buffers. Additionally, the Federal
Reserve may impose limitations or prohibitions on taking capital actions such as paying or increasing common stock dividends. If the Federal Reserve finds that any of our U.S. bank subsidiaries are not “well-capitalized” or
“well-managed,” we would be required to enter into an agreement with the Federal Reserve to comply with all applicable capital and management requirements, which may contain additional limitations or conditions relating to our
activities. Additionally, the applicable federal regulatory authority is authorized to determine, under certain circumstances relating to the financial condition of a bank or bank holding company, that the payment of dividends would be an unsafe or
unsound practice and to prohibit payment thereof.
You may not receive dividends on our common stock.
Holders of our common stock are only entitled to receive such dividends as our board of directors may declare out of funds legally available
for such payments. Furthermore, holders of our common stock are subject to the prior dividend rights of holders of our preferred stock or the depositary shares representing such preferred stock then outstanding. Although we have historically
declared cash dividends on our common stock, we are not required to do so and may reduce or eliminate our common stock dividend in the future.
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Our common stock is equity and is subordinate to our existing and future indebtedness and preferred
stock.
Shares of our common stock are equity interests in us and do not constitute indebtedness. This means that shares of our common
stock will rank junior to all of our indebtedness and to other
non-equity
claims against us and our assets available to satisfy claims against us, including claims in our liquidation. Additionally, holders of
our common stock are subject to the prior dividend and liquidation rights of holders of our outstanding preferred stock or depositary shares representing interests in such preferred stock then outstanding. Our board of directors is authorized to
issue additional classes or series of preferred stock without any action on the part of the holders of our common stock. As of March 25, 2024, the aggregate liquidation preference of all our outstanding preferred stock was approximately
$28.7 billion.
Our preferred stock is equity and is subordinate to our existing and future indebtedness.
Shares of our preferred stock are equity interests in us and do not constitute indebtedness. This means that shares of our preferred stock and
any depositary shares which represent interests in shares of our preferred stock will rank junior to all of our indebtedness and to other
non-equity
claims against us and our assets available to satisfy claims
against us, including claims in our liquidation. Our existing and future indebtedness may restrict payment of dividends on our preferred stock. In addition, holders of our preferred stock or depositary shares representing interests in shares of our
preferred stock may be fully subordinated to interests held by the U.S. government in the event that we enter into a receivership, insolvency, liquidation, or similar proceeding.
Cash dividends on our preferred stock are subject to certain limitations.
Unlike indebtedness, where principal and interest customarily are payable on specified due dates, in the case of our preferred stock
(1) dividends are payable only when, as and if declared by our board of directors or a duly authorized committee of our board of directors and (2) as a corporation, we are restricted to making dividend payments and redemption payments on
our preferred stock out of legally available funds. In addition, under the Federal Reserve’s risk-based capital rules related to additional Tier 1 capital instruments, dividends on our preferred stock may only be paid out of our net income,
retained earnings or surplus related to other additional Tier 1 capital instruments.
If we are deferring payments on our outstanding junior
subordinated notes or are in default under the indentures governing those securities, we will be prohibited from making distributions on our common stock and preferred stock, or redeeming our preferred stock.
The terms of our currently outstanding junior subordinated notes prohibit us from declaring or paying any dividends or distributions on our
common stock and preferred stock, or redeeming, purchasing, acquiring, or making a liquidation payment on such stock, if we are aware of any event that would be an event of default under the indenture governing those junior subordinated notes or at
any time when we have deferred payment of interest on those junior subordinated notes.
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Other Risks
Our ability to pay dividends on our common stock and preferred stock and to make payments on our debt securities depends upon our receipt of funds from our
subsidiaries and applicable laws and regulations, and actions we have taken pursuant to our resolution plan, could restrict the ability of our subsidiaries to transfer funds to us.
We are a holding company and conduct substantially all of our operations through our subsidiaries. We depend on dividends and other
distributions, loans and other payments from our subsidiaries to fund dividend payments on our preferred stock and common stock and to fund payments on our other obligations, including the debt securities. Any inability of our subsidiaries to
transfer funds, pay dividends or make payments to us may adversely affect our cash flow, liquidity and financial condition. Many of our subsidiaries, including our bank and broker-dealer subsidiaries, are subject to laws that restrict dividend
payments or authorize regulatory bodies to block or reduce the flow of funds from those subsidiaries to us or to our other subsidiaries. In addition, our bank and broker-dealer subsidiaries are subject to restrictions on their ability to lend or
transact with affiliates, minimum regulatory capital and liquidity requirements and restrictions on their ability to use funds deposited with them in bank or brokerage accounts to fund their businesses. Lower earnings in our subsidiaries can reduce
the amount of funds available to us. Adverse business and economic conditions, including changes in interest and currency exchange rates, illiquidity or volatility in areas where we have concentrated credit risk, and a failure in or breach of our
operational or security systems or infrastructure, could affect our businesses and results of operations. Intercompany arrangements we have entered into in connection with our resolution planning could restrict the amount of funding available to us
from our subsidiaries under certain adverse conditions, as described above under “—A resolution under our single point of entry resolution strategy could materially adversely affect our liquidity and financial condition and our ability
to pay our obligations on our securities.” These restrictions could prevent those subsidiaries from paying dividends or making other distributions to us or otherwise providing funds to us that we need in order to pay dividends or make payments
on our securities. Also, our right to participate in any distribution of assets of any of our subsidiaries upon such subsidiary’s liquidation or otherwise will be subject to the prior claims of creditors of that subsidiary, except to the
extent that any of our claims as a creditor of such subsidiary may be recognized.
We cannot assure you that a trading market for your securities will
ever develop or be maintained.
We may not list our securities on any securities exchange. We cannot predict how these securities will
trade in the secondary market or whether that market will be liquid or illiquid. The number of potential buyers of our securities in any secondary market may be limited. Although any underwriters or agents may purchase and sell our securities in the
secondary market from time to time, these underwriters or agents will not be obligated to do so and may discontinue making a market for the securities at any time without giving us notice. We cannot assure you that a secondary market for any of our
securities will develop, or that if one develops, it will be maintained.
Our trading activities may create conflicts of interest with you.
We or one or more of our broker-dealer affiliates, including BofA Securities, Inc., may engage in trading activities that are not for your
account or on your behalf. These trading activities may present a conflict of interest between the interest of holders of the securities and the interests we and our affiliates may have in our proprietary accounts, in facilitating transactions,
including block
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trades, for our other customers, and in accounts under our management. These trading activities could influence secondary trading (if any) in the securities, or otherwise could be adverse to the
interests of a beneficial owner of the securities.
Payments on the securities are subject to our credit risk, and actual or perceived changes in our
creditworthiness may affect the value of our securities.
Our credit ratings are an assessment of our ability to pay our obligations.
Consequently, our perceived creditworthiness and actual or anticipated changes in our credit ratings may affect the market value of our securities. However, because the return on our securities generally depends upon factors in addition to our
ability to pay our obligations, an improvement in our credit ratings will not reduce the other investment risks, if any, related to our securities.
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BANK OF AMERICA CORPORATION
Bank of America Corporation is a Delaware corporation, a bank holding company, and a financial holding company. Through various bank and
nonbank subsidiaries throughout the United States and in international markets, we provide a diversified range of banking and nonbank financial services and products. Our principal executive offices are located in the Bank of America Corporate
Center, 100 North Tryon Street, Charlotte, North Carolina 28255 and our telephone number is
(704) 386-5681.
USE OF PROCEEDS
Unless we describe a different use in the applicable supplement, we will use the net proceeds from the sale of the securities for general
corporate purposes. General corporate purposes include, but are not limited to, the following:
•
our working capital needs;
•
the funding of investments in, or extensions of credit to, our subsidiaries;
•
possible reductions, redemptions, repayments or repurchases of outstanding indebtedness or equity securities;
•
the possible acquisitions of, or investments in, other financial institutions or other businesses; and
•
other uses in the ordinary course of conducting our business.
Until we designate the use of these net proceeds, we will invest them temporarily. From time to time, we may engage in additional financings
as we determine appropriate based on our needs and prevailing market conditions. These additional financings may include the sale of other securities.
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DESCRIPTION OF DEBT SECURITIES
General
We
may issue senior or subordinated debt securities. Neither the senior debt securities nor the subordinated debt securities will be secured by any of our property or assets. As a result, by owning a debt security, you are one of our unsecured
creditors.
The senior debt securities will constitute part of our senior debt, will be issued under our Senior Indenture described below,
and will rank equally in right of payment with all of our other unsecured and unsubordinated debt from time to time outstanding, except obligations that are subject to any priorities or preferences by law.
The subordinated debt securities will constitute part of our subordinated debt, will be issued under our Subordinated Indenture described
below, and will be subordinated and junior in right of payment to all of our “senior indebtedness,” as defined in the Subordinated Indenture, from time to time outstanding to the extent and in the manner provided in the Subordinated
Indenture. The subordinated debt securities will rank equally in right of payment with all our other unsecured and subordinated indebtedness, other than unsecured and subordinated indebtedness that by its terms is subordinated to the subordinated
debt securities. Neither the Senior Indenture nor the Subordinated Indenture limits our ability to incur additional “senior indebtedness.”
This section of the prospectus provides a summary of the material terms of the Senior Indenture and the Subordinated Indenture and certain
specific terms of debt securities that may be applicable if so specified in the applicable supplement for such debt securities.
Financial Consequences to Unsecured Debtholders of Single Point of Entry Resolution Strategy
We are subject to the TLAC Rules, which aim to improve the resiliency and resolvability of U.S. global systemically important bank holding
companies (“covered BHCs”), including Bank of America, in the event of material financial distress or failure. The TLAC Rules include the requirement that each covered BHC maintain a minimum amount of eligible LTD and other
loss-absorbing capacity. The eligible LTD would absorb the covered BHC’s losses, following the depletion of its equity, upon its entry into a resolution proceeding under the U.S. Bankruptcy Code or a resolution proceeding administered by the
FDIC under Title II of the Financial Reform Act.
Under Title I of the Financial Reform Act, we are required by the Federal Reserve and
the FDIC to periodically submit a plan for a rapid and orderly resolution under the U.S. Bankruptcy Code in the event of material financial distress or failure. Our preferred resolution strategy under this plan is a SPOE strategy, whereby only Bank
of America would file for bankruptcy under the U.S. Bankruptcy Code. Under this strategy, and pursuant to existing intercompany arrangements under which we have transferred most of our assets to a wholly-owned holding company subsidiary, which holds
the equity interests in our key operating subsidiaries, we would contribute our remaining financial assets, less a holdback to cover our bankruptcy expenses, to this wholly-owned holding company subsidiary prior to filing for bankruptcy. We would
then file for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. Pursuant to an order from the bankruptcy court under section 363 of the U.S. Bankruptcy Code, we, as
debtor-in-possession,
would transfer our subsidiaries to a newly-formed entity (“NewCo”) that would be held in trust for the sole and exclusive benefit of
our bankruptcy estate.
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Under our SPOE resolution strategy, the obligations of Bank of America on its unsecured
debt, including the debt securities offered pursuant to this prospectus, would not be assumed by NewCo; instead, the claims on such obligations would be left behind in the bankruptcy proceeding. After the transferred subsidiaries were stabilized,
NewCo’s residual value in the form of shares or proceeds from the sale of shares would be distributed to the holders of claims against the bankruptcy estate in accordance with the priority of their claims, including to holders of our debt
securities.
In 2013, the FDIC issued a notice describing its similar preferred SPOE recapitalization model for resolving a global
systemically important banking group, such as Bank of America, under Title II of the Financial Reform Act. Under Title II, when a covered BHC is in default or danger of default, the FDIC may be appointed receiver to conduct an orderly liquidation of
such institution as an alternative to resolution of the entity under the U.S. Bankruptcy Code if the Secretary of the Treasury makes certain financial distress and systemic risk determinations. Pursuant to the single point of entry recapitalization
model, the FDIC would use its power to create a “bridge entity” for the covered BHC; transfer the systemically important and viable parts of the covered BHC’s business to the bridge entity; recapitalize those subsidiaries using
assets of the covered BHC that have been transferred to the bridge entity; and exchange external debt claims against the covered BHC, including claims of holders of our debt securities and other unsecured debt, for equity in the bridge entity. This
strategy would allow operating subsidiaries of the covered BHC to continue to operate and impose losses on stockholders and creditors of the covered BHC, which could include holders of our debt securities.
The Indentures
The senior debt securities and the subordinated debt securities each are governed by a document called an indenture, which is a contract
between us and the applicable trustee. Senior debt securities will be issued under the Indenture for Senior Debt Securities dated as of June 27, 2018 (as supplemented from time to time, the “Senior Indenture”) between us, as issuer,
and The Bank of New York Mellon Trust Company, N.A., as trustee, and subordinated debt securities will be issued under the Indenture for Subordinated Debt Securities dated as of June 27, 2018 (as supplemented from time to time, the
“Subordinated Indenture”) between us, as issuer, and The Bank of New York Mellon Trust Company, N.A., as trustee. These indentures are substantially identical in all material respects, except for:
•
the covenant described below under “—Sale or Issuance of Capital Stock of Principal Subsidiary
Bank,” which is included only in the Senior Indenture;
•
the provisions relating to subordination described below under “—Subordination,” which are
included only in the Subordinated Indenture; and
•
the events of default relating to payment defaults and specific provisions for covenant breaches, as described
below under “—Events of Default and Rights of Acceleration; Covenant Breaches,” which are not included in the Subordinated Indenture.
In this prospectus, when we refer to “debt securities,” we mean both our senior debt securities and our subordinated debt
securities. When we refer to the “indenture” or the “trustee” with respect to any debt securities, we mean the indenture under which those debt securities are issued and the trustee under that indenture, and when we refer to
the “indentures,” we mean both the Senior Indenture and the Subordinated Indenture, together.
The trustee under each
indenture has two principal functions:
•
First, the trustee can enforce your rights against us if we default. However, there are limitations on the extent
to which the trustee may act on your behalf, which we describe below under “—Collection of Indebtedness and Suits for Enforcement by Trustee.”
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•
Second, the trustee performs administrative duties for us, including the delivery of interest and other payments
and notices.
Neither of the indentures limit the aggregate amount of debt securities that we may issue or the number of
series or the aggregate amount of any particular series of debt securities. The indentures and the debt securities also do not limit our ability to incur other indebtedness or to issue other securities. This means that we may issue additional debt
securities and other securities at any time without your consent and without notifying you. In addition, neither of the indentures contain provisions protecting holders against a decline in our credit quality resulting from takeovers,
recapitalizations, the incurrence of additional indebtedness, or restructuring. If our credit quality declines as a result of an event of this type, or otherwise, any ratings of our debt securities then outstanding may be withdrawn or downgraded.
This section is a summary of the material terms and provisions of the indentures. We have filed the indentures with the SEC as exhibits
to the registration statement of which this prospectus forms a part. See “Where You Can Find More Information” below for information on how to obtain copies of the indentures. Whenever we refer to the defined terms of an indenture in
this section of this prospectus or in a supplement hereto without defining them, the terms have the meanings given to them in that indenture. You must look to the indentures for the most complete description of the information summarized in this
prospectus.
Form and Denomination of Debt Securities
Unless we specify otherwise in the applicable supplement, we will issue each debt security in book-entry only form. Debt securities in
book-entry only form will be represented by a global security registered in the name of a depository or its nominee. Accordingly, the depository or its nominee will be the registered holder of all the debt securities represented by the global
security. Those who own beneficial interests in a global security will do so through participants in the depository’s securities clearing system, and the rights of these indirect owners will be governed solely by the applicable procedures of
the depository and its participants. We describe the procedures applicable to book-entry only securities below under the heading “Registration and Settlement.”
Unless we specify otherwise in the applicable supplement, we will issue our debt securities in fully registered form, without coupons. If we
issue a debt security in bearer form, we will describe the special considerations applicable to bearer securities in the applicable supplement. Some of the features that we describe in this prospectus may not apply to bearer securities.
Our debt securities may be denominated in U.S. dollars or in another currency as may be specified in the applicable supplement. Unless we
specify otherwise in the applicable supplement, the debt securities will be denominated in U.S. dollars, and unless we specify otherwise in the applicable supplement, the debt securities will be issued in minimum denominations of $1,000 and
integral multiples of $1,000 in excess of $1,000.
Payment for
Non-U.S.
Dollar-Denominated Debt Securities
For any debt securities denominated or payable in a currency other than U.S. dollars (referred to
as
“non-U.S.
dollar-denominated debt securities”), the initial investors will be required to pay for the debt securities in that foreign currency. The applicable selling agent may arrange for the
conversion of U.S. dollars into the applicable foreign currency to facilitate payment for the
non-U.S.
dollar-denominated debt securities by U.S. purchasers desiring to make the initial payment in U.S.
dollars. Any such conversion will be made by that selling agent on the terms and subject to the conditions, limitations, and charges as it may establish from time to time in accordance with its
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regular foreign exchange procedures, and subject to U.S. laws and regulations. All costs of any such conversion for the initial purchase of the
non-U.S.
dollar-denominated debt securities will be borne by the initial investors using those conversion arrangements.
Different
Series of Debt Securities
We may issue our debt securities from time to time in one or more series with the same or different
maturities. We also may “reopen” a series of our debt securities. This means that we can increase the principal amount of a series of our debt securities by selling additional debt securities with the same terms. Such additional debt
securities may be issued in one or more series and with the same or different CUSIP or other identifying number as the outstanding debt securities. Any such additional debt securities, together with the outstanding debt securities, will constitute a
single series of debt securities under the Indenture, provided that such additional debt securities will be issued with the same CUSIP or the same other identifying number as the outstanding debt securities only if they are fungible with the
outstanding debt securities for U.S. federal income tax purposes. We may do so without notice to the existing holders of debt securities of that series. However, any new debt securities of this kind may have a different offering price and may begin
to bear interest (if any) at a different date.
This section of the prospectus summarizes the material terms of the debt securities that
are common to all series under the respective indentures. We will describe the financial and other specific terms of the series of debt securities being offered in the applicable supplement. The applicable supplement also may describe any
differences from the material terms described in this prospectus. If there are any differences between the applicable supplement and this prospectus, the applicable supplement will control.
The terms of your series of debt securities as described in the applicable supplement may include the following:
•
the title and type of the debt securities;
•
the principal amount of the debt securities;
•
the minimum denominations, if other than $1,000 and integral multiples of $1,000 in excess of $1,000;
•
the percentage of the stated principal amount at which the debt securities will be sold and, if applicable, the
method of determining the price;
•
the person to whom any interest is payable, if other than the registered holder of the debt securities;
•
the maturity date or dates;
•
any interest rate or rates, which may be fixed or floating, and the method used to calculate that interest;
•
the base rate that will be used to determine the amounts of any payments on floating rate debt securities;
•
any interest payment dates, the regular record dates for the interest payment dates, the dates from which
interest will begin to accrue, and the applicable business day convention;
•
the place or places where payments on the debt securities may be made and the place or places where the debt
securities may be presented for registration of transfer or exchange;
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•
any date or dates on or after which the debt securities may be redeemed, repurchased, or repaid in whole or in
part at our option or the option of the holder, and the periods, prices, terms, and conditions of that redemption, repurchase, or repayment;
•
if other than the full principal amount, the portion of the principal amount of the debt securities that will be
payable if their maturity is accelerated;
•
the currency of principal, any premium, any interest and any other amounts payable on the debt securities, if
other than U.S. dollars;
•
if the debt securities will be issued in other than book-entry only form;
•
the identification of or method of selecting any calculation agents, exchange rate agents, or any other agents
for the debt securities;
•
any provisions for the discharge of our obligations relating to the debt securities by the deposit of funds or
U.S. government obligations;
•
any provisions relating to the extension or renewal of the maturity date of the debt securities;
•
if the debt securities will be listed on any securities exchange; or
•
any other terms of the debt securities that are permitted under the applicable indenture.
Types of Debt Securities
We may issue the types of debt securities described in this section, and we also may issue debt securities that do not bear interest (which we
refer to as “zero coupon notes”).
Fixed-Rate Notes
We may issue debt securities that bear interest at one or more fixed rates of interest, as specified in the applicable supplement. We refer to
these debt securities as “fixed-rate notes.” We also may issue fixed-rate notes that combine principal and interest payments in installment payments over the life of the notes which we refer to as “amortizing notes.” We will
make payments on fixed-rate notes as described below under the heading “—Payment of Principal, Interest, and Other Amounts Payable” and in the applicable supplement.
Floating-Rate Notes
We may issue debt securities that will bear interest at a floating rate of interest determined by reference to one or more interest rate
bases, referred to as the “base rate.” We refer to these debt securities as “floating-rate notes.” The base rate for a series of floating-rate notes will be specified in, and will be determined in accordance with the specific
formula and/or applicable terms and provisions set forth in, the applicable supplement.
Fixed/Floating Rate Notes
We may issue a debt security with elements of each of the fixed-rate and floating-rate notes described above. For example, a debt security may
bear interest at a fixed rate for some interest periods and at a floating rate in other interest periods. We refer to these debt securities as “fixed/floating rate notes.” We will describe the determination of interest or other amounts
payable for any of these debt securities in the applicable supplement.
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Fixed-Rate Reset Notes
We may issue debt securities that bear interest at a fixed rate for a specified portion of their term and then reset that fixed rate at
specified intervals for the remainder of their term. We refer to these debt securities as “fixed-rate reset notes.” The rate of interest on such debt securities will be specified in, and will be determined in accordance with the terms
and provisions set forth in, the applicable supplement.
Calculation Agents for Certain Types of Debt Securities
For any (a) floating-rate notes, (b) fixed/floating rate notes, during any floating-rate period, or (c) fixed-rate reset notes,
calculations will be made by the applicable calculation agent, which will be an institution that we appoint as our agent for this purpose. The calculation agent may be one of our affiliates and also may be The Bank of New York Mellon Trust Company,
N.A. For floating-rate notes, we will identify in the applicable supplement the initial calculation agent we have appointed for a particular series of debt securities as of the original issue date for such debt securities. For fixed/floating rate
notes and fixed-rate reset notes, we may identify the initial calculation agent in the applicable supplement or we may appoint the calculation agent for a particular series of debt securities after the original issue date for such debt securities,
at any time prior to the commencement of the first floating-rate period, in the case of fixed/floating rate notes, or before the first date on which a calculation is required to be performed, in the case of fixed-rate reset notes. We may remove
and/or appoint different calculation agents from time to time after the original issue date for a series of debt securities, or we may elect to act as the calculation agent with respect to such debt securities, in each case without your consent and
without notifying you of the change. Absent manifest error, all determinations of the calculation agent will be final and binding on you, the trustee and us.
Original Issue Discount Notes
Any of the types of notes described above may be an original issue discount note. Original issue discount notes are debt securities that are
issued at a price lower than their stated principal amount or lower than their minimum guaranteed repayment amount at maturity. Original issue discount notes may be zero coupon notes or may bear interest at a rate that is below market rates at the
time of issuance. Amounts payable in the event of redemption, repayment or upon an acceleration of the maturity of an original issue discount note will be determined in accordance with the terms of that debt security, as described in the applicable
supplement. That amount normally is less than the amount payable at the maturity date. A debt security issued at a discount to its principal may, for U.S. federal income tax purposes, be considered an original issue discount note, regardless of
the amount payable upon redemption or acceleration of maturity. See “U.S. Federal Income Tax Considerations—Taxation of Debt Securities” below for a summary of the U.S. federal income tax consequences of owning an
original issue discount note.
Payment of Principal, Interest, and Other Amounts Payable
Paying Agents
We
may appoint one or more financial institutions to act as our paying agents. Initially, under the indentures, we have appointed The Bank of New York Mellon Trust Company, N.A. to act as our paying agent with respect to the debt securities through its
corporate trust office currently located at 4655 Salisbury Road, Suite 300, Jacksonville, Florida 32256. We may add, replace or terminate any paying agent from time to time in accordance with the applicable indenture, in each case without your
consent and without notifying you of such change. In addition, we may decide to act as our own paying agent with respect to some or all of the debt securities, and the paying agent may resign, in each case without your consent and without notifying
you of such event.
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Payments to Holders and Record Dates for Interest
We refer to each date on which interest is payable on a debt security as an “interest payment date.” Subject to any applicable
business day convention set forth in the applicable supplement, interest payments on the debt securities will be made on each interest payment date applicable to, and at the maturity date, or earlier redemption date, of, the applicable debt
securities. Interest payable on any interest payment date other than the maturity date, or earlier redemption date, will be paid to the registered holder of the debt security at the close of business on the regular record date for that interest
payment date. However, unless we specify otherwise in the applicable supplement, the initial interest payment on a debt security issued between a regular record date and the interest payment date immediately following the regular record date will be
made on the second interest payment date following the original issue date to the holder of record on the regular record date preceding the second interest payment date. Unless we specify otherwise in the applicable supplement, the principal and
interest payable at maturity, or earlier redemption, will be paid to the holder of the debt security at the time of payment by the paying agent.
Unless we specify otherwise in the applicable supplement, the record date for any interest payment for a debt security in book-entry only form
will be the close of business on the date that is one business day prior to the payment date, unless such debt security is a
non-U.S.
dollar denominated debt security held through DTC, in which case the record
date for an interest payment date will be the close of business on the fifteenth calendar day prior to such interest payment date, whether or not such record date is a business day. If the debt security is in a form that is other than book-entry
only, and unless we specify otherwise in the applicable supplement, the regular record date for an interest payment date will be the close of business on the fifteenth calendar day prior to such interest payment date, whether or not such record date
is a business day.
Unless we specify otherwise in the applicable supplement, the term “business day” means any weekday that
is not a legal holiday in New York, New York, Charlotte, North Carolina, or any other place of payment of the applicable debt security, and is not a date on which banking institutions in those cities are authorized or required by law or regulation
to be closed.
Payments Due in U.S. Dollars
Unless we specify otherwise in the applicable supplement, our debt securities will be denominated, and payments with respect to the debt
securities will be made, in U.S. dollars. Unless we specify otherwise in the applicable supplement, we will follow the practices described in this section when we pay amounts that are due in U.S. dollars.
We will make payments on debt securities in book-entry only form in accordance with arrangements then in place between the paying agent and
the depository or its nominee, as holder. An indirect owner’s right to receive those payments will be governed by the rules and practices of the depository and its participants, as described below under the heading “Registration and
Settlement.”
Indirect owners should contact their banks or brokers for information on how they will receive payments on
their debt securities.
We will pay any interest on debt securities in definitive form on each interest payment date other than the
maturity date, or earlier redemption date, by, in our discretion, wire transfer of immediately available funds or check mailed to holders of the debt securities on the applicable record date at the address appearing on our or the security
registrar’s records. We will pay
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principal and any premium, interest, or other amounts payable at the maturity date, or earlier redemption date, of a debt security in definitive form by wire transfer of immediately available
funds to the registered holders of the debt security at the time of payment.
Payments Due in Other Currencies
General
If any
of the debt securities are denominated, or if principal and any premium, interest, or other amounts payable on any of the debt securities is payable, in a foreign currency, the specified currency, as well as any additional investment considerations,
risk factors, restrictions, tax consequences, specific terms and other information relating to that series of debt securities and the specified currency will be described in the applicable supplement.
Unless we specify otherwise in the applicable supplement, we will follow the practices described in this section when we pay amounts that are
due on
non-U.S.
dollar-denominated debt securities. Unless we specify otherwise in the applicable supplement, and except as described below, holders of
non-U.S.
dollar-denominated debt securities are not entitled to receive payments in U.S. dollars of an amount due in another currency, either on a global debt security or a debt security in definitive form.
We will make payments on
non-U.S. dollar-denominated
debt securities in book-entry only form in
the applicable specified currency in accordance with arrangements then in place between the paying agent and the depository or its nominee, as holder. An indirect owner’s right to receive those payments will be governed by the rules and
practices of the depository and its participants, as described below under the heading “Registration and Settlement.”
Non-U.S.
Dollar-Denominated Debt Securities Held Through DTC
Unless we specify otherwise in the
applicable supplement, holders of beneficial interests in
non-U.S.
dollar-denominated debt securities through a participant in The Depository Trust Company, or “DTC,” will receive payments in U.S.
dollars, unless they elect to receive payments on those debt securities in the applicable foreign currency. If a holder of such beneficial interests through DTC does not make an election through its DTC participant to receive payments in the
applicable foreign currency, the exchange rate agent for the relevant
non-U.S.
dollar-denominated debt securities to be appointed by us will convert payments to that holder into U.S. dollars, and all costs of
those conversions will be borne by that holder by deduction from the applicable payments.
The holder of a beneficial interest in global
non-U.S.
dollar-denominated debt securities held through a DTC participant may elect to receive payments on those debt securities in the foreign currency by notifying the DTC participant through which it holds its
beneficial interests on or prior to the fifteenth business day prior to the record date for the applicable debt securities of (1) that holder’s election to receive all or a portion of the payment in the applicable foreign currency and
(2) wire transfer instructions to an account for the applicable foreign currency outside the United States. DTC must be notified of the election and wire transfer instructions (a) on or prior to the fifth business day after the record date
for any payment of interest and (b) on or prior to the tenth business day prior to the date for any payment of principal. DTC will notify the trustee or other applicable paying agent of the election and wire transfer instructions (1) on or
prior to the fifth business day after the record date for any payment of interest and (2) on or prior to the tenth business day prior to the date for any payment of principal. If complete instructions are forwarded to and received by DTC
through a DTC participant and forwarded by DTC to the trustee or other applicable paying agent and received on or prior to the dates described above, the holder will receive payment in the applicable foreign currency outside DTC; otherwise, only
U.S. dollar payments will be made by the trustee or other applicable paying agent to DTC.
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For holders of
non-U.S.
dollar-denominated debt
securities held through a DTC participant not electing payment in the applicable foreign currency, the U.S. dollar amount of any payment will be the amount of the applicable foreign currency otherwise payable, converted into U.S. dollars at the
applicable exchange rate prevailing as of 11:00 a.m. (New York City time) on the second business day prior to the relevant payment date, less any costs incurred by the exchange rate agent for that conversion unless we specify otherwise in the
applicable supplement. The costs of those conversions will be shared pro rata among the holders of beneficial interests in the applicable global debt securities receiving U.S. dollar payments in the proportion of their respective holdings. The
exchange rate agent, to be appointed by us at the time of issuance for such
non-U.S.
dollar-denominated debt securities held through a DTC participant, will make those conversions in accordance with prevailing
market practice and the terms of the applicable debt security and with any applicable arrangements between us and the exchange rate agent.
If an exchange rate quotation is unavailable from the entity or source ordinarily used by the exchange rate agent in the normal course of
business, the exchange rate agent will obtain a quotation from a leading foreign exchange bank in New York City, which may be an affiliate of the exchange rate agent or another entity selected by the exchange rate agent for that purpose after
consultation with us. If no quotation from a leading foreign exchange bank is available, payment will be made in the applicable foreign currency to the account or accounts specified by DTC to the trustee or other applicable paying agent, unless the
applicable foreign currency is unavailable due to the imposition of exchange controls or other circumstances beyond our control.
Unavailability of Currencies and Replacement Currencies
If, at or about the time of payment of any principal, premium or interest on a
non-U.S.
dollar-denominated debt security, the relevant specified currency is not legal tender for the payment of public and private debts in the country issuing the currency as of the original issue date of such debt security or is otherwise unavailable,
and the relevant specified currency has been replaced by another currency that has become legal tender for the payment of public and private debts in such country (a “replacement currency”), any amount payable pursuant to such debt
security may be paid, at our option, in the replacement currency or in U.S. dollars, at a rate of exchange which takes into account the conversion, at the rate prevailing on the most recent date on which official conversion rates were quoted or set
by the national government or other authority responsible for issuing the replacement currency, from the specified currency to the replacement currency or to U.S. dollars, if applicable, and, if necessary, the conversion of the replacement currency
into U.S. dollars at the rate prevailing on the date of such conversion. In this circumstance, we will appoint a financial institution to act as exchange rate agent for purposes of making the required conversions in accordance with prevailing market
practice and the terms of the applicable debt security and with any applicable arrangements between us and the exchange rate agent.
Notwithstanding the foregoing, the relevant specified currency may not be available to us for making payments of principal of or any premium,
interest or other amounts payable on any
non-U.S.
dollar-denominated debt securities. This could occur due to the imposition of exchange controls or other circumstances beyond our control, or if the specified
currency is no longer used by the government of the country issuing that currency or by public institutions within the international banking community for the settlement of transactions. If the specified currency is unavailable and has not been
replaced, and unless otherwise specified in the applicable supplement, we may satisfy our obligations to holders of the relevant
non-U.S.
dollar-denominated debt securities by making those payments due in the
relevant specified currency on the date of payment in U.S. dollars. The amount of such payments made in U.S. dollars will be determined by an exchange rate agent to be appointed by us on the basis of the noon dollar buying rate in The City of New
York for cable transfers of the specified currency or currencies in which a payment on any
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such
non-U.S.
dollar-denominated debt securities was to be made, published by the Federal Reserve Bank of New York, which is referred to as the
“market exchange rate,” or such other rate as may be set forth in the applicable supplement. If that rate of exchange is not then available or is not published for a particular payment currency, the market exchange rate will be based on
the highest bid quotation in The City of New York received by the exchange rate agent at approximately 11:00 a.m., New York City time, on the second business day preceding the applicable payment date from three recognized foreign exchange dealers
for the purchase by the quoting dealer:
•
of the specified currency for U.S. dollars for settlement on the payment date;
•
in the aggregate amount of the specified currency payable to those holders or beneficial owners of
non-U.S.
dollar-denominated debt securities; and
•
at which the applicable dealer commits to execute a contract.
One of the dealers providing quotations may be the exchange rate agent unless the exchange rate agent is our affiliate. If those bid
quotations are not available, the exchange rate agent will determine the market exchange rate at its sole discretion in accordance with prevailing market practice and the terms of the applicable debt security and with any applicable arrangements
between us and the exchange rate agent.
The above provisions do not apply if a specified currency is unavailable because it has been
replaced by the euro. If the euro has been substituted for a specified currency of the relevant
non-U.S.
dollar-denominated debt security, we may, at our option, or will, if required by applicable law, without
the consent of the holders of the affected debt securities, pay the principal of and any premium, interest or other amounts payable on any
non-U.S.
dollar-denominated debt securities in euro instead of the
specified currency, in conformity with legally applicable measures taken pursuant to, or by virtue of, the Treaty establishing the European Community, as amended. Any payment made in U.S. dollars, an applicable replacement currency, or in euro as
described above where the required payment is in an unavailable specified currency will not constitute an event of default under the relevant indenture or the applicable debt securities.
The exchange rate agent to be appointed by us may be one of our affiliates, and, from time to time after the initial appointment of an
exchange rate agent, we may appoint one or more different exchange rate agents for the relevant
non-U.S.
dollar-denominated debt security without your consent and without notifying you of the change. The
exchange rate agent will determine the applicable rate of exchange that would apply to a payment made in U.S. dollars or a replacement currency in its sole discretion unless we state in the applicable supplement that any determination requires our
approval. Absent manifest error, those determinations will be final and binding on you and us.
For purposes of the above discussion about
currency conversions and payments on
non-U.S.
dollar-denominated debt securities, unless otherwise specified in the applicable supplement, the term “business day” means any weekday that is not a
legal holiday in New York, New York or Charlotte, North Carolina and is not a day on which banking institutions in those cities are authorized or required by law or regulation to be closed.
Indirect owners of a debt security with a specified currency other than U.S. dollars should contact their banks or brokers for
information about how to receive payments in the specified currency or in U.S. dollars.
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Non-U.S.
Dollar-Denominated Securities in
Definitive Form
We will pay any interest on
non-U.S. dollar-denominated
debt
securities in definitive form on each interest payment date other than the maturity date, or earlier redemption date, by, in our discretion, wire transfer of immediately available funds or check mailed to holders of the debt securities on the
applicable record date at the address appearing on our or the security registrar’s records. Unless we specify otherwise in the applicable supplement, we will pay principal and any premium, interest, or other amounts payable at the maturity
date, or earlier redemption date, of a
non-U.S. dollar-denominated
debt security in definitive form by wire transfer of immediately available funds to the registered holders of the debt security at the
time of payment.
No Sinking Fund
Unless we specify otherwise in the applicable supplement, our debt securities will not be entitled to the benefit of any sinking fund. This
means that we will not deposit money on a regular basis into any separate custodial account to repay the debt securities.
Redemption
The applicable supplement will indicate whether we may redeem the debt securities prior to their stated maturity date. If we may redeem the
debt securities prior to their stated maturity date, the applicable supplement will indicate the redemption price, the method for redemption, and the date or dates upon which we may redeem the debt securities. Debt securities to be redeemed in part
may only be redeemed in increments of their minimum denomination. The redemption of any debt security that is our eligible LTD will require the prior approval of the Federal Reserve if after such redemption we would fail to satisfy our requirements
as to eligible LTD or total loss-absorbing capacity under the TLAC Rules. In addition, unless we specify otherwise in the applicable supplement, to the extent then required by applicable laws or regulations, our subordinated debt securities may not
be redeemed prior to their stated maturity date without the requisite prior approvals, if any, from applicable regulators.
Notice
of Redemption
Unless we specify otherwise in the applicable supplement, we may exercise our right to redeem debt securities by
giving notice to the holders under the applicable indenture at least 5 business days but not more than 60 calendar days before the specified redemption date. The notice will specify:
•
the date fixed for redemption;
•
the redemption price (or, if not then ascertainable, the manner of calculation thereof);
•
the CUSIP number and any other identifying number of the debt securities to be redeemed;
•
the amount to be redeemed, if less than all of the outstanding debt securities of a series are to be redeemed;
•
the place of payment for the debt securities to be redeemed;
•
that interest (if any) accrued on the debt securities to be redeemed will be paid as specified in the notice; and
•
that, subject to satisfaction of any conditions to such redemption set forth in the notice of redemption and
unless we default in payment of the redemption price, on and after the date fixed for redemption, interest (if any) will cease to accrue on the debt securities to be redeemed.
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Such redemption may be subject to the satisfaction of one or more conditions precedent, in
which case the notice of redemption will describe each condition and, if applicable, state that the redemption date may, in our discretion, be delayed until such time as any or all conditions have been satisfied, or such redemption may not occur and
such notice may be rescinded in the event that any or all of the conditions have not been satisfied by the redemption date stated in the notice of redemption, or by the redemption date as it may be delayed in our discretion.
If notice of redemption has been given in accordance with the applicable indenture, the debt securities being redeemed shall, subject to the
satisfaction of any conditions to the redemption as specified in the notice of redemption, become due and payable on the date fixed for redemption.
So long as a depository is the record holder of the applicable debt securities to be redeemed, we, or the trustee on our behalf if we so
request, will deliver any notice of our election to exercise our redemption right only to that depository.
Repayment
The applicable supplement will indicate whether the debt securities can be repaid at the holder’s option prior to their stated
maturity date. If the debt securities may be repaid prior to their stated maturity date, the applicable supplement will indicate the applicable repayment price or prices, the procedures for repayment and the date or dates on or after which the
holder can request repayment.
Repurchase
We may purchase at any time and from time to time, including through a subsidiary or affiliate of ours, outstanding debt securities by tender,
in the open market, or by private agreement. The repurchase of any debt security that is our eligible LTD will require the prior approval of the Federal Reserve if after such repurchase we would fail to satisfy our requirements as to eligible LTD or
total loss-absorbing capacity under the TLAC Rules. We, or our affiliates, have the discretion to hold or resell any repurchased debt securities. We also have the discretion to cancel any repurchased debt securities.
Conversion
We
may issue debt securities that are convertible into, or exercisable or exchangeable for, at either our option or the holder’s option or otherwise as provided in the applicable supplement, our preferred stock, depositary shares, common stock,
or other debt securities. The applicable supplement will describe the terms of any conversion, exercise, or exchange features, including:
•
the periods during which conversion, exercise, or exchange, as applicable, may be elected;
•
the conversion, exercise, or exchange price payable and the number of shares or amount of our preferred stock,
depositary shares, common stock, or other debt securities, that may be issued upon conversion, exercise, or exchange, and any adjustment provisions; and
•
the procedures for electing conversion, exercise, or exchange, as applicable.
Exchange, Registration, and Transfer
Unless we specify otherwise in the applicable supplement, we will issue each debt security in global, or book-entry only, form. Debt
securities in global form may be exchanged for debt securities in definitive form only in the limited circumstances described in the relevant debt securities or in the applicable indenture.
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Subject to the terms of the applicable indenture, debt securities of any series in
definitive form may be exchanged at the option of the holder for other debt securities of the same series and of an equal aggregate principal amount and type in any authorized denominations.
Debt securities in definitive form may be presented for registration of transfer at the office of the security registrar or at the office of
any transfer agent that we designate and maintain. The security registrar or the transfer agent will make the registration of transfer only if it is satisfied with the documents of title and identity of the person making the request. There will not
be a service charge for any exchange or registration of transfer of debt securities, but we may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with the exchange or transfer. Unless
we specify otherwise in the applicable supplement, initially, The Bank of New York Mellon Trust Company, N.A. will be the authenticating agent, security registrar, and transfer agent for the debt securities issued under the respective
indentures. We may change the security registrar or the transfer agent or approve a change in the location through which any security registrar or transfer agent acts at any time, in each case without your consent and without notifying you of such
event. We will be required to maintain a security registrar and transfer agent in each place of payment for each series of debt securities. At any time, we may designate additional transfer agents for any series of debt securities.
We will not be required to (1) issue, exchange, or register the transfer of any debt security of any series to be redeemed for a period
of 15 days before the date on which we deliver the notice of redemption or (2) exchange or register the transfer of any debt security (i) that was selected, called, or is being called for redemption, except the unredeemed portion of
any debt security being redeemed in part or (ii) as to which the holder has exercised any right to require us to repay such debt security, except the portion to remain outstanding of any debt security being repaid in part.
For a discussion of restrictions on the exchange, registration, and transfer of book-entry only securities, see “Registration and
Settlement” below.
Subordination
Our subordinated debt securities are subordinated and junior in right of payment to all of our “senior indebtedness.” The
Subordinated Indenture defines “senior indebtedness” as any indebtedness for money borrowed, including all of our indebtedness for borrowed and purchased money, all of our obligations arising from
off-balance
sheet guarantees and direct credit substitutes, and our obligations associated with derivative products such as interest and foreign exchange rate contracts and commodity contracts, that was
outstanding on the date we executed the Subordinated Indenture, or was created, incurred, or assumed after that date, for which we are responsible or liable as obligor, guarantor, or otherwise, and all deferrals, renewals, extensions, and refundings
of that indebtedness or obligations, other than the debt securities issued under the Subordinated Indenture or any other indebtedness that by its terms is subordinate in right of payment to any of our other indebtedness. Each supplement for a series
of subordinated debt securities will indicate the aggregate amount of our senior indebtedness outstanding, as of the most recent practicable date, and any limitation on the issuance of additional senior indebtedness. As of December 31, 2023, on
a
non-consolidated
basis, we had approximately $223 billion of senior long-term debt and certain senior short-term borrowings. Senior indebtedness also includes our obligations under letters of credit,
guarantees, foreign exchange contracts and interest rate swap contracts, none of which are included in such amount. In addition, holders of subordinated debt securities may be fully subordinated to interests held by the U.S. government in the event
that we enter into a receivership, insolvency, liquidation or similar proceeding.
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If there is a default or event of default under any senior indebtedness that would allow
acceleration of maturity of that senior indebtedness and that default or event of default is not remedied, and we and the trustee of the Subordinated Indenture receive notice of this default from the holders of at least 10% in principal amount of
any kind or category of any senior indebtedness or if the trustee of the Subordinated Indenture receives notice from us, then we will not be able to make any principal, premium, interest, or other payments on the subordinated debt securities or
repurchase our subordinated debt securities.
If any subordinated debt security is declared due and payable before the stated maturity
date (or other date for payment of principal) upon a payment or distribution of our assets to creditors pursuant to our dissolution, winding up, liquidation, or reorganization, whether voluntary or involuntary, we are required to pay all principal
and any premium, interest, or other payments to holders of senior indebtedness before any holders of subordinated debt are paid. In addition, if any amounts previously were paid to the holders of our subordinated debt securities or the trustee under
the Subordinated Indenture, the holders of senior indebtedness will have first rights to the amounts previously paid.
Subject to the
payment in full of all our senior indebtedness, the holders of our subordinated debt securities will be subrogated to the rights of the holders of our senior indebtedness to receive payments or distributions of our assets applicable to the senior
indebtedness until our subordinated debt securities are paid in full. For purposes of this subrogation, the subordinated debt securities will be subrogated equally and ratably with all our other indebtedness that by its terms ranks equally with our
subordinated debt securities and is entitled to like rights of subrogation.
Due to differing subordination provisions in various series
of subordinated debt securities issued by us and our predecessors, in the event of a dissolution, winding up, liquidation, reorganization, insolvency, receivership or other proceeding, holders of subordinated debt securities may receive more or
less, ratably, than holders of some other series of our outstanding subordinated debt securities.
Sale or Issuance of
Capital Stock of Principal Subsidiary Bank
The Senior Indenture prohibits the issuance, sale, or other disposition of capital stock,
or securities convertible into or options, warrants, or rights to acquire capital stock, of any Principal Subsidiary Bank (as defined below) or of any subsidiary which owns shares of capital stock, or securities convertible into or options,
warrants, or rights to acquire capital stock, of any Principal Subsidiary Bank, with the following exceptions:
•
sales or other dispositions of directors’ qualifying shares;
•
sales or other dispositions for fair market value, if, after giving effect to the disposition and to conversion
of any shares or securities convertible into capital stock of a Principal Subsidiary Bank, we would own at least 80% of each class of the capital stock of that Principal Subsidiary Bank;
•
sales or other dispositions made in compliance with an order of a court or regulatory authority of competent
jurisdiction;
•
any sale by a Principal Subsidiary Bank of additional shares of its capital stock, securities convertible into
shares of its capital stock, or options, warrants, or rights to subscribe for or purchase shares of its capital stock, to its stockholders at any price, so long as before that sale we owned, directly or indirectly, securities of the same class and
immediately after the sale, we owned, directly or indirectly, at least as great a percentage of each class of securities of the Principal Subsidiary Bank as we owned before the sale of additional securities; and
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•
any issuance of shares of capital stock, or securities convertible into or options, warrants, or rights to
subscribe for or purchase shares of capital stock, of a Principal Subsidiary Bank or any subsidiary which owns shares of capital stock, or securities convertible into or options, warrants, or rights to acquire capital stock, of any Principal
Subsidiary Bank, to us or our wholly owned subsidiary.
A “Principal Subsidiary Bank” is defined in the
Senior Indenture as any subsidiary bank with total assets equal to more than 10% of our total consolidated assets. As of the date of this prospectus, Bank of America, N.A. is our only Principal Subsidiary Bank.
Limitation on Mergers and Sales of Assets
Each indenture generally permits a consolidation or merger between us and another entity, subject to certain requirements. It also permits the
sale, conveyance or transfer by us of all or substantially all of our assets, subject to certain requirements. These transactions are permitted if:
•
the resulting or acquiring entity, if other than us, is organized and existing under the laws of the United
States, any state of the United States or the District of Columbia and expressly assumes all of our obligations under that indenture; and
•
immediately after the transaction, we (or any successor entity) are not in default in the performance of any
covenant or condition under that indenture.
The foregoing requirements do not apply in the case of a sale, conveyance
or transfer by us of all or substantially all of our assets to one or more entities that are direct or indirect subsidiaries in which we and/or one or more of our subsidiaries own more than 50% of the combined voting power.
Upon any consolidation, merger, sale, conveyance or transfer of this kind (other than, where permitted as described above, a sale, conveyance
or transfer of all or substantially all of our assets to our direct or indirect subsidiary or subsidiaries in which we own more than 50% of the combined voting power as described in the preceding paragraph), the resulting or acquiring entity will be
substituted for us in the applicable indenture with the same effect as if it had been an original party to that indenture. As a result, the successor entity may exercise our rights and powers under that indenture.
Waiver of Covenants
The holders of a majority in principal amount of the debt securities of all affected series then outstanding under an indenture may waive
compliance with some of the covenants or conditions of that indenture.
Modification of the Indentures
We and the trustee may modify the applicable indenture and the rights of the holders of the debt securities with the consent of the holders of
at least 50% of the aggregate principal amount of all series of outstanding debt securities under that indenture affected by the modification.
No modification may extend the fixed maturity of, reduce the principal amount or redemption premium of, or reduce the rate of interest, or
extend the time of payment of interest or other amounts due, on any debt security without the consent of each holder affected by the modification. No modification may reduce the percentage of debt securities that is required to consent to
modification of an indenture without the consent of all holders of the debt securities outstanding under that indenture.
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In addition, we and the trustee may execute supplemental indentures in some circumstances
without the consent of any holders of outstanding debt securities.
For purposes of determining the aggregate principal amount of the debt
securities outstanding at any time in connection with any request, demand, authorization, direction, notice, consent, or waiver under the applicable indenture, (1) the principal amount of any debt security issued with original issue discount is
that amount of principal that would be due and payable at that time upon a declaration of acceleration of the maturity of the original issue discount note, and (2) the principal amount of a debt security denominated in a foreign currency or
currency unit is the U.S. dollar equivalent on the date of original issuance of the debt security, determined as specified in the applicable supplement for that debt security.
Meetings and Action by Securityholders
The trustee may call a meeting in its discretion, or upon request by us or the holders of at least 10% in principal amount of a series of
outstanding debt securities, by giving notice. If a meeting of holders is duly held, any resolution raised or decision taken in accordance with the indenture will be binding on all holders of debt securities of that series.
Events of Default and Rights of Acceleration; Covenant Breaches
The Senior Indenture defines an event of default for a series of senior debt securities as any one of the following events:
•
our failure to pay principal of or any premium on any senior debt securities of that series when due and payable,
and continuance of such default for a period of 30 days;
•
our failure to pay interest on any senior debt securities of that series when due and payable, and continuance of
such default for a period of 30 days;
•
specified events involving our bankruptcy, insolvency, or liquidation; and
•
any other events of default specified for a series of senior debt securities pursuant to the Senior Indenture.
The Subordinated Indenture defines an event of default for subordinated debt securities only as our voluntary or
involuntary bankruptcy under U.S. federal bankruptcy laws (and, in the case of our involuntary bankruptcy, continuing for a period of 60 days) and any other events of default specified for a series of subordinated debt securities pursuant to the
Subordinated Indenture.
Any additional or different events of default for a series of senior or subordinated debt securities will be
specified in the applicable supplement.
Unless otherwise specified in the applicable supplement, if an event of default under an
indenture occurs and is continuing, either the trustee or the holders of 25% in aggregate principal amount of the debt securities outstanding under the applicable indenture (or, in the case of an event of default with respect to a series of senior
debt securities under the Senior Indenture, the holders of 25% in aggregate principal amount of the outstanding senior debt securities of all series affected) may declare the principal amount, or, if the debt securities are issued with original
issue discount, such amount as described in the applicable supplement, of all debt securities (or the outstanding senior debt securities of all series affected, as the case may be) to be due and payable immediately. The holders of a majority in
aggregate principal amount of the debt securities then outstanding (or of all series affected, as the case may be), in some circumstances, may annul the declaration of acceleration and waive past defaults.
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With respect to a failure on our part to observe or perform any of the covenants or
agreements contained in the debt securities or in the applicable indenture (other than (i) with respect to senior debt securities, those for which acceleration rights are available as discussed above and (ii) with respect to subordinated
debt securities, default in payment of principal or interest), which failure continues for a period of 90 days after the date on which written notice of such failure is given (a “covenant breach”), the trustee and the holders of the debt
securities may pursue certain remedies as described below or as set forth in the applicable indenture.
Unless otherwise specified in the
applicable supplement, an event of default will not occur under our senior debt securities, and neither the trustee nor the holders of any senior debt securities will have the right to accelerate the payment of principal of such senior debt
securities, as a result of a covenant breach. In addition, an event of default will not occur, and neither the trustee nor the holders of such senior debt securities will have the right to accelerate the payment of principal of such senior debt
securities, as a result of our failure to pay principal of or premium on such senior debt securities when due and payable until such default has continued for a period of 30 days.
Unless otherwise specified in the applicable supplement, payment of principal of the subordinated debt securities may not be accelerated in
the case of a default in the payment of principal or any premium, interest, or other amounts or a breach in the performance of any of our other covenants.
We are required periodically to file with the trustees a certificate stating that we are not in default under any of the terms of the
indentures.
Collection of Indebtedness and Suits for Enforcement by Trustee
If (i) we fail to pay the principal of or any premium on any debt securities or (ii) we are over 30 calendar days late on an
interest payment on the debt securities, the applicable trustee can demand that we pay to it, for the benefit of the holders of those debt securities, the amount which is due and payable on those debt securities, including any interest incurred
because of our failure to make that payment. In the event of our nonpayment of principal, interest or any premium (which nonpayment for senior debt securities constitutes an event of default) or a covenant breach, the trustee may take appropriate
action, including instituting judicial proceedings against us.
In addition, a holder of our debt securities also may file suit to enforce
our obligation to make payment of principal and any premium, interest, or other amounts payable on such debt securities regardless of the actions taken by the trustee.
The holders of a majority in principal amount of each series of the debt securities then outstanding under an indenture may direct the time,
method, and place of conducting any proceeding for any remedy available to the trustee under that indenture. The trustee may decline to act if the direction is contrary to law and in certain other circumstances set forth in the applicable indenture.
The trustee is not obligated to exercise any of its rights or powers under the applicable indenture at the request or direction of the holders of the debt securities unless the holders offer the trustee reasonable indemnity against expenses and
liabilities.
Limitation on Suits
Each indenture provides that no individual holder of debt securities of any series may institute any action against us under that indenture,
except actions for payment of overdue principal and interest, unless the following actions have occurred:
•
the holder must have previously given written notice to the trustee of a continuing event of default or covenant
breach;
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•
the holders of not less than 25% in principal amount of such outstanding debt securities issued under the
applicable indenture must have (1) requested the trustee to institute proceedings in respect of such event of default or covenant breach and (2) offered the trustee indemnity against liabilities incurred by the trustee for taking such
action, which indemnity is reasonably satisfactory to the trustee;
•
the trustee must have failed to institute proceedings within 60 days after receipt of the request referred to
above; and
•
the holders of a majority in principal amount of such outstanding debt securities issued under the applicable
indenture must not have given direction to the trustee inconsistent with the request of the holders referred to above.
However, the holder of any senior debt securities will have an absolute right to receive payment of principal of and any premium and interest
on the senior debt security when due and to institute suit to enforce this payment, and the holder of any subordinated debt securities will have, subject to applicable subordination provisions, the absolute right to receive payment of principal of
and any premium and any interest on the subordinated debt security when due and to institute suit to enforce this payment.
Payment of Additional Amounts
If we so specify in the applicable supplement, and subject to the exceptions and limitations set forth below, we will pay to the holder of any
debt security that is a
“non-U.S. person”
additional amounts to ensure that every net payment on that debt security will not be less, due to the payment of U.S. withholding tax, than the
amount then otherwise due and payable. For this purpose, a “net payment” on a debt security means a payment by us or any paying agent, including payment of principal and interest, after deduction for any present or future tax,
assessment, or other governmental charge of the United States (other than a territory or possession). These additional amounts will constitute additional interest on the debt security. For this purpose, U.S. withholding tax means a withholding
tax of the United States, other than a territory or possession.
However, notwithstanding our obligation, if so specified, to pay
additional amounts, we will not be required to pay additional amounts in any of the circumstances described in items (1) through (15) below, unless we specify otherwise in the applicable supplement.
(1)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld solely by reason of the beneficial owner of the debt security:
•
having a relationship with the United States as a citizen, resident, or otherwise;
•
having had such a relationship in the past; or
•
being considered as having had such a relationship.
(2)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld solely by reason of the beneficial owner of the debt security:
•
being treated as present in or engaged in a trade or business in the United States;
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•
being treated as having been present in or engaged in a trade or business in the United States in the past;
•
having or having had a permanent establishment in the United States; or
•
having or having had a qualified business unit which has the U.S. dollar as its functional currency.
(3)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld solely by reason of the beneficial owner of the debt security being or having been a:
•
personal holding company;
•
foreign personal holding company;
•
private foundation or other
tax-exempt
organization;
•
passive foreign investment company;
•
controlled foreign corporation; or
•
corporation which has accumulated earnings to avoid U.S. federal income tax.
(4)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld solely by reason of the beneficial owner of the debt security owning or having owned, actually or constructively, 10% or more of the total combined voting power of all classes of
our stock entitled to vote.
(5)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld solely by reason of the beneficial owner of the debt security being a bank extending credit under a loan agreement entered into in the ordinary course of business.
For purposes of items (1) through (5) above, “beneficial owner” includes, without
limitation, a holder and a fiduciary, settlor, partner, member, shareholder, or beneficiary of the holder if the holder is an estate, trust, partnership, limited liability company, corporation, or other entity, or a person holding a power over an
estate or trust administered by a fiduciary holder.
(6)
Additional amounts will not be payable to any beneficial owner of a debt security that is:
•
A fiduciary;
•
A partnership;
•
A limited liability company;
•
Another fiscally transparent entity; or
•
Not the sole beneficial owner of the debt security, or any portion of the debt security.
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However, this exception to the obligation to pay additional amounts will apply only to the
extent that a beneficiary or settlor in relation to the fiduciary, or a beneficial owner, partner, or member of the partnership, limited liability company, or other fiscally transparent entity, would not have been entitled to the payment of an
additional amount had the beneficiary, settlor, beneficial owner, partner, or member received directly its beneficial or distributive share of the payment.
(7)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld solely by reason of the failure of the beneficial owner of the debt security or any other person to comply with applicable certification, identification, documentation, or other
information reporting requirements. This exception to the obligation to pay additional amounts will apply only if compliance with such requirements is required as a precondition to exemption from such tax, assessment, or other governmental charge by
statute or regulation of the United States or by an applicable income tax treaty to which the United States is a party.
(8)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is collected or imposed by any method other than by withholding from a payment on a debt security by us or any paying agent.
(9)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld by reason of a change in law, regulation, or administrative or judicial interpretation that becomes effective more than 15 days after the payment becomes due or is duly provided
for, whichever occurs later.
(10)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld by reason of the presentation by the beneficial owner of a debt security for payment more than 30 days after the date on which such payment becomes due or is duly provided for,
whichever occurs later.
(11)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any:
•
estate tax;
•
inheritance tax;
•
gift tax;
•
sales tax;
•
excise tax;
•
transfer tax;
•
wealth tax;
•
personal property tax; or
•
any similar tax, assessment, or other governmental charge.
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(12)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge required to be withheld by any paying agent from a payment of principal or interest on the applicable security if such payment can be made without such withholding by any other paying agent.
(13)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld by reason of the application of Section 1471 through Section 1474 of the U.S. Internal Revenue Code of 1986, as amended,(or any successor provision), any regulation,
pronouncement, or agreement thereunder, official interpretations thereof, or any law implementing an intergovernmental approach thereto, whether currently in effect or as published and amended from time to time.
(14)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any tax,
assessment, or other governmental charge that is imposed or withheld by reason of the payment being treated as a dividend or dividend equivalent for U.S. tax purposes.
(15)
Additional amounts will not be payable if a payment on a debt security is reduced as a result of any
combination of items (1) through (14) above.
Except as specifically provided in this section, we will not be
required to make any payment of any tax, assessment, or other governmental charge imposed by any government, political subdivision, or taxing authority of that government.
For purposes of determining whether the payment of additional amounts is required, the term “U.S. person” means any individual who
is a citizen or resident of the United States; any corporation, partnership, or other entity created or organized in or under the laws of the United States; any estate if the income of such estate falls within the federal income tax jurisdiction of
the United States regardless of the source of that income; and any trust if a U.S. court is able to exercise primary supervision over its administration and one or more U.S. persons have the authority to control all of the substantial decisions of
the trust. Additionally, for this purpose,
“non-U.S.
person” means a person who is not a U.S. person, and “United States” means the United States of America, including each state of the
United States and the District of Columbia, its territories, its possessions, and other areas within its jurisdiction.
Redemption for Tax Reasons
If we so specify in the applicable supplement, we may redeem the debt securities in whole, but not in part, at any time before maturity, if we
have or will become obligated to pay additional amounts, as described above under “—Payment of Additional Amounts,” as a result of any change in, or amendment to, the laws or regulations of the United States or any political
subdivision or any authority of the United States having power to tax, or any change in the application or official interpretation of such laws or regulations, which change or amendment becomes effective on or after the date of the applicable
supplement for the issuance of those debt securities. If we exercise such right to redeem the debt securities, unless we specify otherwise in the applicable supplement, we will give not less than 5 business days’ nor more than 60 calendar
days’ notice to the trustee under the applicable indenture and to the holders of the debt securities.
In connection with any notice
of redemption for tax reasons, we will deliver to the trustee under the indenture any required certificate, request, or order.
Unless we
specify otherwise in the applicable supplement, any debt securities redeemed for tax reasons will be redeemed at a redemption price equal to 100% of the principal amount of such debt securities, plus accrued and unpaid interest, if any, thereon, to,
but excluding, the date fixed for redemption.
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Defeasance and Covenant Defeasance
If we so specify in the applicable supplement, the provisions for full defeasance and covenant defeasance described below will apply to the
debt securities of a series if certain conditions are satisfied.
Full Defeasance
. If there is a change in the U.S. federal
income tax law, as described below, we can legally release ourselves from all payment and other obligations on the debt securities of a series. This is called full defeasance. For us to do so, among other conditions set forth in the applicable
indenture, each of the following must occur:
•
We must deposit in trust with the trustee for the benefit of the holders of those debt securities a combination
of money and U.S. government or U.S. government agency notes or bonds that, in the opinion of a nationally recognized firm of independent public accountants, will generate enough cash to make interest, principal, and any other payments on
those debt securities when due;
•
There must be a change in current U.S. federal income tax law or an Internal Revenue Service ruling that
lets us make the above deposit without causing the beneficial owners to be taxed for U.S. federal income tax purposes on those debt securities any differently than if we did not make the deposit and repaid those debt securities ourselves; and
•
We must deliver to the trustee under the indenture a legal opinion of our counsel confirming the tax law
treatment described above.
If we ever fully defeased your debt security, you would have to rely solely on the trust
deposit for payments on your debt security.
Covenant Defeasance.
Under current U.S. federal income tax law, we can make the
same type of deposit described above and be released from restrictive covenants relating to your debt security. This is called covenant defeasance. In that event, you would lose the protection of those restrictive covenants. In order to achieve
covenant defeasance for a series of debt securities, among other conditions set forth in the applicable indenture, we must do both of the following:
•
We must deposit in trust with the trustee for the benefit of the holders of those debt securities a combination
of money and U.S. government or U.S. government agency notes or bonds that, in the opinion of a nationally recognized firm of independent public accountants, will generate enough cash to make interest, principal, and any other payments on those debt
securities on their due dates; and
•
We must deliver to the trustee under the indenture a legal opinion of our counsel confirming that under current
U.S. federal income tax law we may make the above deposit without causing the beneficial owners to be taxed for U.S. federal income tax purposes on those debt securities any differently than if we did not make the deposit and repaid the debt
securities ourselves.
If we achieve covenant defeasance with respect to your debt security, you can still look to us
for repayment of your debt security in the event of any shortfall in the trust deposit. You should note, however, that if one of the remaining events of default occurred, such as our bankruptcy, and your debt security became immediately due and
payable, there may be a shortfall. Depending on the event causing the default, you may not be able to obtain payment of the shortfall.
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Satisfaction and Discharge of the Indenture
The indenture under which a series of debt securities has been issued will cease to be of further effect with respect to the debt securities
of such series, if at any time:
•
We have delivered to the trustee for cancellation all debt securities of such series; or
•
All debt securities of such series not delivered to the trustee for cancellation have become due and payable, or
will become due and payable within one year, or are to be called for redemption within one year under arrangements satisfactory to the trustee for the giving of notice of redemption, and we have irrevocably deposited with the trustee or the
applicable paying agent as trust funds for the entire amount in cash due with respect to such debt securities on or after the date of such deposit, including at maturity or upon redemption of all such debt securities, including principal and any
premium, interest and other amounts payable, and any mandatory sinking fund payments, on the dates on which such payments are due and payable.
The trustee, on our demand, accompanied by an officer’s certificate of ours and an opinion of counsel and at our cost and expense, will
execute proper instruments acknowledging such satisfaction of and discharging the applicable indenture with respect to such debt securities.
Notices
We or the trustee on our behalf, if so requested, will provide the holders with any required notices by first-class mail
to the addresses of the holders as they appear in the security register. So long as a depository is the record holder of a series of debt securities with respect to which a notice is given, we or the trustee, if so requested, will deliver the notice
only to that depository in accordance with the procedures of that depository then in place.
Concerning the Trustee
We and certain of our affiliates have from time to time maintained deposit accounts and conducted other banking transactions with The Bank of
New York Mellon Trust Company, N.A. and its affiliates in the ordinary course of business. We expect to continue these business transactions. The Bank of New York Mellon Trust Company, N.A. is initially serving as the trustee for the debt securities
issued under the Senior Indenture and the Subordinated Indenture. The Bank of New York Mellon Trust Company, N.A. and its affiliates also serve as trustee for a number of series of outstanding indebtedness of us and our affiliates under other
indentures. Consequently, if an actual or potential event of default occurs with respect to any of these securities, the trustee may be considered to have a conflicting interest for purposes of the Trust Indenture Act of 1939, as amended. In that
case, the trustee may be required to resign under one or more of the indentures, and we would be required to appoint a successor trustee. For this purpose, a “potential” event of default means an event that would be an event of default
if the requirements for giving us default notice or for the default having to exist for a specific period of time were disregarded. In addition, the trustee can resign for any reason by giving at least 30 calendar days’ written notice of
resignation, and we would be required to appoint a successor trustee. The trustee will remain the trustee under the applicable indenture until a successor is appointed.
Governing Law
The indentures are and the debt securities will be governed by New York law.
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DESCRIPTION OF WARRANTS
General
The
warrants are options that are securities within the meaning of Section 2(a)(17) of the Securities Act of 1933, as amended (the “Securities Act”).
We may issue warrants, including securities warrants, index warrants and currency warrants. We may offer warrants separately or as part of a
unit, as described below under the heading “Description of Units.” If we issue warrants as part of a unit, the applicable supplement will specify whether those warrants may be separated from the other securities in the unit prior to the
warrants’ expiration date. Universal warrants issued in the United States may not be so separated prior to the 91st day after the issuance of the unit, unless otherwise specified in the applicable supplement.
We may issue warrants in any amounts or in as many distinct series as we determine. We will issue each series of warrants under a separate
warrant agreement to be entered into between us and a warrant agent to be designated in the applicable supplement. When we refer to a series of warrants, we mean all warrants issued as part of the same series under the applicable warrant agreement.
Any warrants that we issue will contain, to the extent required, contractual provisions required to comply with the “Restrictions
on Qualified Financial Contracts of Systemically Important U.S. Banking Organizations and the U.S. Operations of Systemically Important Foreign Banking Organizations; Revisions to the Definition of Qualifying Master Netting Agreement and Related
Definitions” as issued by the Federal Reserve, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency and other applicable law.
This section describes some of the general terms and provisions of the warrants. We will describe the specific terms of a series of warrants
and the applicable warrant agreement in the applicable supplement. The following description and any description of the warrants in the applicable supplement may not be complete and is subject to and qualified in its entirety by reference to the
terms and provisions of the applicable warrant agreement. A warrant agreement reflecting the particular terms and provisions of a series of offered warrants will be filed with the SEC in connection with the offering and incorporated by reference in
the registration statement and this prospectus. See “Where You Can Find More Information” below for information on how to obtain copies of any warrant agreements.
Description of Securities Warrants
We may issue warrants for the purchase of our debt securities, common stock or preferred stock. We refer to this type of warrant as a
“securities warrant.” If securities warrants are offered, the applicable supplement will describe the terms of the securities warrants and the warrant agreement relating to the securities warrants, including the following:
•
the offering price;
•
the title and aggregate number of the securities warrants;
•
the nature and amount of the securities that the securities warrants represent the right to buy or sell;
•
if applicable, the designation, aggregate stated principal amount, and terms of the securities purchasable upon
exercise of the securities warrants;
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•
the currency, currency unit, or composite currency in which the price for the securities warrants is payable;
•
if applicable, the designation and terms of the debt securities with which the securities warrants are issued,
and the number of securities warrants issued with each security;
•
if applicable, the date on and after which the securities warrants and the related securities will be separately
transferable;
•
the price at which the securities may be purchased or sold, the currency, and the procedures and conditions
relating to exercise;
•
the method of exercising the securities warrants, the method of paying the exercise price, and the method of
settling the securities warrants;
•
the dates the right to exercise the securities warrants will commence and expire and, if the securities warrants
are not continuously exercisable, any dates on which the securities warrants are not exercisable;
•
any circumstances that will cause the securities warrants to be deemed to be automatically exercised;
•
if applicable, a discussion of the U.S. federal income tax consequences;
•
whether the securities warrants or related securities will be listed on any securities exchange;
•
whether the securities warrants will be issued in global or definitive form;
•
the name of the warrant agent;
•
a description of the terms of any warrant agreement to be entered into between us and a bank or trust company, as
warrant agent, governing the securities warrants; and
•
any other terms of the securities warrants which are permitted under the warrant agreement.
Description of Index Warrants
We may issue warrants entitling the holders thereof to receive from us, upon exercise, an amount in cash determined by reference to decreases
or increases in the level of a specific index or in the levels (or relative levels) of two or more indices or combinations of indices, which index or indices may be based on one or more stocks, bonds or other securities, one or more currencies or
currency units, or any combination of the foregoing,
provided
that any warrants that are based, in whole or in part, on one or more currency indices will be listed on a national securities exchange. We refer to this type of warrant as an
“index warrant.”
Description of Currency Warrants
We may also issue warrants entitling the holders thereof to receive from us, upon exercise, an amount in cash determined by reference to
decreases or increases in the price or level (or relative price, level or exchange rate) of specified amounts of one or more currencies or currency units,
provided
that these warrants will be listed on a national securities exchange. We refer
to this type of warrant as a “currency warrant.”
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Modification
We and the warrant agent may amend the terms of any warrant agreement and the warrants without the consent of the holders of the applicable
warrants to cure any ambiguity, to correct any inconsistent provision, or in any other manner we deem necessary or desirable and which will not affect adversely the interests of the holders. In addition, we may amend any warrant agreement and the
terms of the applicable warrants with the consent of the holders of a majority of the outstanding unexercised warrants affected. However, any modification to the warrants cannot change the exercise price, reduce the amounts receivable upon exercise,
cancellation, or expiration, shorten the time period during which such warrants may be exercised, or otherwise materially and adversely affect the rights of the holders of such warrants or reduce the percentage of outstanding warrants required to
modify or amend the warrant agreement or the terms of such warrants, without the consent of the affected holders.
Enforceability of Rights of Warrantholders; No Trust Indenture Act Protection
The warrant agent will act solely as our agent and will not assume any obligation or relationship of agency or trust with the holders of the
warrants. Any record holder or beneficial owner of a warrant, without anyone else’s consent, may enforce by appropriate legal action, on his or her own behalf, his or her right to exercise the warrant in accordance with its terms. A holder of
a warrant will not be entitled to any of the rights of a holder of the debt securities or other securities or warrant property purchasable upon the exercise of the warrant, including any right to receive payments on those securities or warrant
property or to enforce any covenants or rights in the relevant indenture or any other agreement, before exercising the warrant.
No
warrant agreement will be qualified as an indenture, and no warrant agent under any warrant agreement will be required to qualify as a trustee, under the Trust Indenture Act of 1939. Therefore, holders of warrants issued under a warrant
agreement will not have the protection of the Trust Indenture Act of 1939 with respect to their warrants.
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DESCRIPTION OF PURCHASE CONTRACTS
General
We
may issue purchase contracts in any amounts and in as many distinct series as we determine. We may offer purchase contracts separately or as part of a unit, as described below under the heading “Description of Units.” When we refer to a
series of purchase contracts, we mean all purchase contracts issued as part of the same series under the applicable purchase contract.
Any purchase contracts that we issue will contain, to the extent required, contractual provisions required to comply with the
“Restrictions on Qualified Financial Contracts of Systemically Important U.S. Banking Organizations and the U.S. Operations of Systemically Important Foreign Banking Organizations; Revisions to the Definition of Qualifying Master Netting
Agreement and Related Definitions” as issued by the Federal Reserve, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency and other applicable law.
This section describes some of the general terms and provisions applicable to all purchase contracts. We will describe the specific terms of a
series of purchase contracts in the applicable supplement. The following description and any description of the purchase contracts in the applicable supplement may not be complete and is subject to and qualified in its entirety by reference to the
terms and provisions of the applicable purchase contract. A purchase contract reflecting the particular terms and provisions of a series of offered purchase contracts will be filed with the SEC in connection with the offering and incorporated by
reference in the registration statement and this prospectus. See “Where You Can Find More Information” below for information on how to obtain copies of any purchase contracts.
Purchase Contract Property
We may issue purchase contracts for the purchase or sale of, or whose cash value is determined by reference to the performance, level, or
value of securities, including our common or preferred stock or our other securities described in this prospectus, a basket of securities or any combination of the foregoing. We refer to each type of property described above as a “purchase
contract property.”
Each purchase contract will obligate:
•
the holder to purchase or sell, and us to sell or purchase, on specified dates, one or more purchase contract
properties at a specified price or prices; or
•
the holder or us to settle the purchase contract with a cash payment determined by reference to the value,
performance, or level of one or more purchase contract properties, on specified dates and at a specified price or prices.
No holder of a purchase contract will, as such, have any rights of a holder of the purchase contract property purchasable under or referenced
in the contract, including any rights to receive payments on that property.
Information in Supplement
If we offer purchase contracts, the applicable supplement will describe the terms of the purchase contracts, including the following:
•
the purchase date or dates;
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•
if other than U.S. dollars, the currency or currency unit in which payment will be made;
•
the specific designation and aggregate number of, and the price at which we will issue, the purchase contracts;
•
whether the purchase contract obligates the holder to purchase or sell, or both purchase and sell, one or more
purchase contract properties, and the nature and amount of each of those properties, or the method of determining those amounts;
•
the purchase contract property or cash value, and the amount or method for determining the amount of purchase
contract property or cash value, deliverable under each purchase contract;
•
whether the purchase contract is to be prepaid or not and the governing document for the contract;
•
the price at which the purchase contract is settled, and whether the purchase contract is to be settled by
delivery of, or by reference or linkage to the value, performance, or level of, the purchase contract properties;
•
any acceleration, cancellation, termination, or other provisions relating to the settlement of the purchase
contract;
•
if the purchase contract property is an index, the method of providing for a substitute index or indices or
otherwise determining the amount payable;
•
if the purchase contract property is an index or a basket of securities, a description of the index or basket of
securities;
•
whether, following the occurrence of a market disruption event or force majeure event (as defined in the
applicable supplement), the settlement delivery obligation or cash settlement value of a purchase contract will be determined on a different basis than under normal circumstances;
•
whether the purchase contract will be issued as part of a unit and, if so, the other securities comprising the
unit and whether any unit securities will be subject to a security interest in our favor as described below;
•
if applicable, a discussion of the U.S. federal income tax consequences;
•
the identities of any depositories and any paying, transfer, calculation, or other agents for the purchase
contracts;
•
whether the purchase contract will be issued in global or definitive form;
•
any securities exchange or quotation system on which the purchase contracts or any securities deliverable in
settlement of the purchase contracts may be listed; and
•
any other terms of the purchase contracts and any terms required by or advisable under applicable laws and
regulations.
Prepaid Purchase Contracts; Applicability of Indenture
Purchase contracts may require holders to satisfy their obligations under the purchase contracts at the time they are issued. We refer to
these contracts as “prepaid purchase contracts.”
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In certain circumstances, our obligation to settle a prepaid purchase contract on the
relevant settlement date may constitute our senior debt securities or our subordinated debt securities. Accordingly, prepaid purchase contracts may be issued under the indentures, which are described above under the heading “Description of
Debt Securities.”
Non-Prepaid
Purchase Contracts; No Trust Indenture Act
Protection
Some purchase contracts do not require holders to satisfy their obligations under the purchase contracts until settlement.
We refer to these contracts as
“non-prepaid
purchase contracts.” The holder of a
non-prepaid
purchase contract may remain obligated to perform under the
contract for a substantial period of time.
Non-prepaid
purchase contracts will be issued under a
unit agreement, if they are issued in units, or under some other document, if they are not. We describe unit agreements generally under the heading “Description of Units” below. We will describe the particular governing document that
applies to your
non-prepaid
purchase contracts in the applicable supplement.
Non-prepaid
purchase contracts will not be our senior debt securities or subordinated debt securities and will not be issued under one of our indentures, unless we specify otherwise in the applicable supplement.
Consequently, no governing documents for
non-prepaid
purchase contracts will be qualified as indentures, and no third party will be required to qualify as a trustee with regard to those contracts, under the
Trust Indenture Act of 1939. Therefore, holders of
non-prepaid
purchase contracts will not have the protection of the Trust Indenture Act of 1939.
Pledge by Holders to Secure Performance
If we so specify in the applicable supplement, the holder’s obligations under the purchase contract and governing document will be
secured by collateral. In that case, the holder, acting through the unit agent as its
attorney-in-fact,
if applicable, will pledge the items described below to a
collateral agent that we will identify in the applicable supplement, which will hold them, for our benefit, as collateral to secure the holder’s obligations. We refer to this as the “pledge” and all the items described below as the
“pledged items.” Unless we specify otherwise in the applicable supplement, the pledge will create a security interest in the holder’s entire interest in and to:
•
any other securities included in the unit, if the purchase contract is part of a unit, and/or any other property
specified in the applicable supplement;
•
all additions to and substitutions for the pledged items;
•
all income, proceeds, and collections received in respect of the pledged items; and
•
all powers and rights owned or acquired later with respect to the pledged items.
The collateral agent will forward all payments and proceeds from the pledged items to us, unless the payments and proceeds have been released
from the pledge in accordance with the purchase contract and the governing document. We will use the payments and proceeds from the pledged items to satisfy the holder’s obligations under the purchase contract.
Settlement of Purchase Contracts that Are Part of Units
Unless we specify otherwise in the applicable supplement, where purchase contracts issued together with debt securities as part of a unit
require the holders to buy purchase contract property, the unit agent may apply principal payments from the debt securities in satisfaction of
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the holders’ obligations under the related purchase contract as specified in the applicable supplement. The unit agent will not so apply the principal payments if the holder has delivered
cash to meet its obligations under the purchase contract. If the holder is permitted to settle its obligations by cash payment, the holder may be permitted to do so by delivering the debt securities in the unit to the unit agent as provided in the
governing document. If the holder settles its obligations in cash rather than by delivering the debt security that is part of the unit, that debt security will remain outstanding, if the maturity extends beyond the relevant settlement date and, as
more fully described in the applicable supplement, the holder will receive that debt security or an interest in the relevant global debt security.
Book-entry and other indirect owners should consult their banks or brokers for information on how to settle their purchase contracts.
Failure of Holder to Perform Obligations
If the holder fails to settle its obligations under a
non-prepaid
purchase contract as required, the
holder will not receive the purchase contract property or other consideration to be delivered at settlement. Holders that fail to make timely settlement also may be obligated to pay interest or other amounts.
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DESCRIPTION OF UNITS
General
We
may issue units from time to time in such amounts and in as many distinct series as we determine.
We will issue each series of units
under a unit agreement to be entered into between us and a unit agent to be designated in the applicable supplement. When we refer to a series of units, we mean all units issued as part of the same series under the applicable unit agreement.
Any units that we issue will contain, to the extent required, contractual provisions required to comply with the “Restrictions on
Qualified Financial Contracts of Systemically Important U.S. Banking Organizations and the U.S. Operations of Systemically Important Foreign Banking Organizations; Revisions to the Definition of Qualifying Master Netting Agreement and Related
Definitions” as issued by the Federal Reserve, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency and other applicable law.
This section describes some of the general terms and provisions applicable to all the units. We will describe the specific terms of a series
of units and the applicable unit agreement in the applicable supplement. The following description and any description of the units in the applicable supplement may not be complete and is subject to and qualified in its entirety by reference to the
terms and provisions of the applicable unit agreement. A unit agreement reflecting the particular terms and provisions of a series of offered units will be filed with the SEC in connection with the offering and incorporated by reference in the
registration statement and this prospectus. See “Where You Can Find More Information” below for information on how to obtain copies of any unit agreements.
We may issue units consisting of one or more securities described in this prospectus or, in any combination. Each unit will be issued so that
the holder of the unit is also the holder of each security included in the unit. Thus, the holder of a unit will have the rights and obligations of a holder of each included security. The unit agreement under which a unit is issued may provide that
the securities included in the unit may not be held or transferred separately, at any time or at any time before a specified date.
If
units are offered, the applicable supplement will describe the terms of the units, including the following:
•
the designation and aggregate number of, and the price at which we will issue, the units;
•
the terms of the units and of the securities comprising the units, including whether and under what circumstances
the securities comprising the units may or may not be held or transferred separately;
•
the name of the unit agent;
•
a description of the terms of any unit agreement to be entered into between us and a bank or trust company, as
unit agent, governing the units;
•
if applicable, a discussion of the U.S. federal income tax consequences;
•
whether the units will be listed on any securities exchange; and
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•
a description of the provisions for the payment, settlement, transfer, or exchange of the units.
Unit Agreements: Prepaid,
Non-Prepaid,
and Other
If a unit includes one or more purchase contracts, and all those purchase contracts are prepaid purchase contracts, we will issue the unit
under a “prepaid unit agreement.” Prepaid unit agreements will reflect the fact that the holders of the related units have no further obligations under the purchase contracts included in their units. If a unit includes one or more
non-prepaid
purchase contracts, we will issue the unit under a
“non-prepaid
unit agreement.”
Non-prepaid
unit agreements
will reflect the fact that the holders have payment or other obligations under one or more of the purchase contracts comprising their units. We may also issue units under other kinds of unit agreements, which will be described in the applicable
supplement, if applicable.
Each holder of units issued under a
non-prepaid
unit agreement will:
•
be bound by the terms of each
non-prepaid
purchase contract included in
the holder’s units and by the terms of the unit agreement with respect to those contracts; and
•
appoint the unit agent as its authorized agent to execute, deliver, and perform on the holder’s behalf each
non-prepaid
purchase contract included in the holder’s units.
Any unit
agreement for a unit that includes a
non-prepaid
purchase contract also will include provisions regarding the holder’s pledge of collateral and special settlement provisions. These are described above
under the heading “Description of Purchase Contracts.”
A unit agreement also may serve as the governing document for a
security included in a unit. For example, a
non-prepaid
purchase contract that is part of a unit may be issued under and governed by the relevant unit agreement.
Modification
We and the unit agent may amend the terms of any unit agreement and the units without the consent of the applicable holders to cure any
ambiguity, to correct any inconsistent provision, or in any other manner we deem necessary or desirable and which will not affect adversely the interests of such holders. In addition, we may amend any unit agreement and the terms of the units with
the consent of the holders of a majority of the outstanding unexpired units affected. However, any modification to the applicable units that materially and adversely affects the rights of the holders of such units, or reduces the percentage of
outstanding units required to modify or amend the unit agreement or the terms of such units, requires the consent of the affected holders.
Enforceability of Rights of Unitholders; No Trust Indenture Act Protection
The unit agent will act solely as our agent and will
not assume any obligation or relationship of agency or trust with the holders of the units. Except as described below, any record holder of a unit, without anyone else’s consent, may enforce his or her rights as holder under any security
included in the unit, in accordance with the terms of the included security and the indenture, warrant agreement, unit agreement, or purchase contract under which that security is issued. We describe these terms in other sections of this prospectus
relating to debt securities, warrants, and purchase contracts.
Notwithstanding the foregoing, a unit agreement may limit or otherwise
affect the ability of a holder of units issued under that agreement to enforce his or her rights, including any right to bring legal action, with respect to those units or any included securities, other than debt securities. We will describe any
limitations of this kind in the applicable supplement.
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No unit agreement will be qualified as an indenture, and no unit agent will be required to
qualify as a trustee under the Trust Indenture Act of 1939. Therefore, holders of units issued under a unit agreement will not have the protection of the Trust Indenture Act of 1939 with respect to their units.
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DESCRIPTION OF PREFERRED STOCK
General
We
may issue preferred stock in one or more series, each with the preferences, designations, limitations, conversion rights, and other rights as we may determine. As of the date of this prospectus, under our Restated Certificate of Incorporation, we
have authority to issue 100,000,000 shares of preferred stock, par value $.01 per share. As of March 25, 2024, we had approximately 4.1 million issued and outstanding shares of preferred stock and the aggregate liquidation preference of
all of our outstanding preferred stock was approximately $28.7 billion.
Any preferred stock sold using this prospectus will have the
general dividend, voting, and liquidation preference rights stated below unless we specify otherwise in the applicable supplement. The applicable supplement for a series of preferred stock will describe the specific terms of those shares, including,
where applicable:
•
the title and stated value of the preferred stock;
•
the aggregate number of shares of preferred stock offered;
•
the offering price or prices of the preferred stock;
•
the dividend rate or rates or method of calculation, the dividend period, and the dates dividends will be
payable;
•
whether dividends are cumulative or noncumulative, and, if cumulative, the date the dividends will begin to
cumulate;
•
the dividend and liquidation preference rights of the preferred stock relative to any existing or future series
of our preferred stock;
•
the dates the preferred stock become subject to redemption at our option, and any redemption terms;
•
any redemption or sinking fund provisions, including any restriction on the repurchase or redemption of the
preferred stock while there is an arrearage in the payment of dividends;
•
whether the preferred stock will be issued in other than book-entry only form;
•
whether the preferred stock will be listed on any securities exchange;
•
any rights on the part of the stockholder or us to convert the preferred stock into shares of our common stock or
any other security; and
•
any additional voting, liquidation, preemptive, and other rights, preferences, privileges, limitations, and
restrictions.
Shares of our preferred stock will be uncertificated unless our board of directors by resolution
determines otherwise. Shares represented by an existing certificate will remain certificated until such certificate is surrendered to us.
This section summarizes the general terms and provisions of our preferred stock. You also should refer to our Restated Certificate of
Incorporation and the respective certificates of
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designations for each series of our preferred stock. We have filed our Restated Certificate of Incorporation as an exhibit to the registration statement of which this prospectus forms a part, and
we will file with the SEC the certificate of designations with respect to the particular series of preferred stock being offered promptly after the offering of that series of preferred stock.
Dividends
The
holders of our preferred stock will be entitled to receive when, as, and if declared by our board of directors, cash dividends at those rates as will be fixed by our board of directors, subject to the terms of our Restated Certificate of
Incorporation. All dividends will be paid out of funds that are legally available for this purpose. Unless we specify otherwise in the applicable supplement, whenever dividends on any
non-voting
preferred
stock are in arrears for three or more semi-annual dividend periods or six quarterly dividend periods, as applicable (whether or not consecutive), holders of the
non-voting
preferred stock will have the right
to elect two additional directors to serve on our board of directors, and these two additional directors will continue to serve until full dividends on such
non-voting
preferred stock have been paid regularly
for at least two semi-annual or four quarterly dividend periods.
Voting
The holders of our preferred stock will have no voting rights except:
•
as required by applicable law; or
•
as specifically approved by us for that particular series.
Under regulations adopted by the Federal Reserve, if the holders of any series of our preferred stock become entitled to vote for the election
of directors because dividends on that series are in arrears, that series may then be deemed a “class of voting securities.” In such a case, a holder of 25% or more of the series, or a holder of such lower amount of the series as may be
deemed, when coupled with other factors, to constitute a “controlling influence” over us, may then be subject to regulation as a bank holding company in accordance with The Bank Holding Company Act of 1956. In addition, (1) any
other bank holding company may be required to obtain the prior approval of the Federal Reserve to acquire or retain 5% or more of that series, and (2) any person other than a bank holding company may be required to obtain the approval of the
Federal Reserve to acquire or retain 10% or more of that series.
Liquidation Preference
In the event of our voluntary or involuntary dissolution, liquidation, or winding up, the holders of any series of our preferred stock will be
entitled to receive, after distributions to holders of any series or class of our capital stock ranking superior, an amount equal to the stated or liquidation value of the shares of the series plus an amount equal to accrued and unpaid dividends. If
the assets and funds to be distributed among the holders of our preferred stock will be insufficient to permit full payment to the holders, then the holders of our preferred stock will share ratably in any distribution of our assets in proportion to
the amounts that they otherwise would receive on their shares of our preferred stock if the shares were paid in full. In addition, holders of our preferred stock, or depositary shares representing interests in our preferred stock, may be fully
subordinated to interests held by the U.S. government in the event that we enter into a receivership, insolvency, liquidation or similar proceeding.
Preemptive Rights
Unless we specify otherwise in the applicable supplement, holders of our preferred stock will not have any
preemptive rights.
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Existing Preferred Stock
As of the date of this prospectus, under our Restated Certificate of Incorporation, we have authority to issue 100,000,000 shares of preferred
stock, par value $.01 per share. As of March 25, 2024, we had approximately 4.1 million issued and outstanding shares of preferred stock and the aggregate liquidation preference of all of our outstanding preferred stock was approximately
$28.7 billion. Of our authorized and outstanding preferred stock, as of March 25, 2024:
•
35,045 shares were designated as 7% Cumulative Redeemable Preferred Stock, Series B (the “Series
B Preferred Stock”), having a liquidation preference of $100 per share, 7,076 shares of which were issued and outstanding;
•
85,100 shares were designated as Floating Rate
Non-Cumulative
Preferred Stock, Series E (the “Series E Preferred Stock”), having a liquidation preference of $25,000 per share, 12,317 shares of which were issued and outstanding;
•
7,001 shares were designated as Floating Rate
Non-Cumulative
Preferred Stock, Series F (the “Series F Preferred Stock”), having a liquidation preference of $100,000 per share, 1,409 shares of which were issued and outstanding;
•
8,501 shares were designated as Adjustable Rate
Non-Cumulative
Preferred Stock, Series G (the “Series G Preferred Stock”), having a liquidation preference of $100,000 per share, 4,925 shares of which were issued and outstanding;
•
6,900,000 shares were designated as 7.25%
Non-Cumulative
Perpetual
Convertible Preferred Stock, Series L (the “Series L Preferred Stock”), having a liquidation preference of $1,000 per share, 3,080,182 shares of which were issued and outstanding;
•
40,000 shares were designated as
Fixed-to-Floating
Rate
Non-Cumulative
Preferred Stock, Series U (the “Series U Preferred Stock”), having a
liquidation preference of $25,000 per share, 40,000 shares of which were issued and outstanding;
•
80,000 shares were designated as
Fixed-to-Floating
Rate
Non-Cumulative
Preferred Stock, Series X (the “Series X Preferred Stock”), having a
liquidation preference of $25,000 per share, 80,000 shares of which were issued and outstanding;
•
56,000 shares were designated as
Fixed-to-Floating
Rate
Non-Cumulative
Preferred Stock, Series Z (the “Series Z Preferred Stock”), having a
liquidation preference of $25,000 per share, 56,000 shares of which were issued and outstanding;
•
76,000 shares were designated as
Fixed-to-Floating
Rate
Non-Cumulative
Preferred Stock, Series AA (the “Series AA Preferred Stock”), having a
liquidation preference of $25,000 per share, 76,000 shares of which were issued and outstanding;
•
40,000 shares were designated as
Fixed-to-Floating
Rate
Non-Cumulative
Preferred Stock, Series DD (the “Series DD Preferred Stock”), having a
liquidation preference of $25,000 per share, 40,000 shares of which were issued and outstanding;
•
94,000 shares were designated as
Fixed-to-Floating
Rate
Non-Cumulative
Preferred Stock, Series FF (the “Series FF Preferred Stock”), having a
liquidation preference of $25,000 per share, 90,833 shares of which were issued and outstanding;
•
55,200 shares were designated as 6.000%
Non-Cumulative
Preferred Stock,
Series GG (the “Series GG Preferred Stock”), having a liquidation preference of $25,000 per share, 54,000 shares of which were issued and outstanding;
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•
34,160 shares were designated as 5.875%
Non-Cumulative
Preferred Stock,
Series HH (the “Series HH Preferred Stock”), having a liquidation preference of $25,000 per share, 34,049 shares of which were issued and outstanding;
•
40,000 shares were designated as
Fixed-to-Floating
Rate
Non-Cumulative
Preferred Stock, Series JJ (the “Series JJ Preferred Stock”), having a
liquidation preference of $25,000 per share, 34,171 shares of which were issued and outstanding;
•
60,950 shares were designated as 5.375%
Non-Cumulative
Preferred Stock,
Series KK (the “Series KK Preferred Stock”), having a liquidation preference of $25,000 per share, 55,272 shares of which were issued and outstanding;
•
52,400 shares were designated as 5.000%
Non-Cumulative
Preferred Stock,
Series LL (the “Series LL Preferred Stock”), having a liquidation preference of $25,000 per share, 52,045 shares of which were issued and outstanding;
•
44,000 shares were designated as
Fixed-to-Floating
Rate
Non-Cumulative
Preferred Stock, Series MM (the “Series MM Preferred Stock”), having a
liquidation preference of $25,000 per share, 30,753 shares of which were issued and outstanding;
•
44,000 shares were designated as 4.375%
Non-Cumulative
Preferred Stock,
Series NN (the “Series NN Preferred Stock”), having a liquidation preference of $25,000 per share, 42,993 shares of which were issued and outstanding;
•
36,600 shares were designated as 4.125%
Non-Cumulative
Preferred Stock,
Series PP (the “Series PP Preferred Stock”), having a liquidation preference of $25,000 per share, 36,500 shares of which were issued and outstanding;
•
52,000 shares were designated as 4.250%
Non-Cumulative
Preferred Stock,
Series QQ (the “Series QQ Preferred Stock”), having a liquidation preference of $25,000 per share, 51,879 shares of which were issued and outstanding;
•
70,000 shares were designated as 4.375% Fixed-Rate Reset
Non-Cumulative
Preferred Stock, Series RR (the “Series RR Preferred Stock”), having a liquidation preference of $25,000 per share, 66,738 shares of which were issued and outstanding;
•
28,000 shares were designated as 4.750%
Non-Cumulative
Preferred Stock,
Series SS (the “Series SS Preferred Stock”), having a liquidation preference of $25,000 per share, 27,463 shares of which were issued and outstanding;
•
80,000 shares were designated as 6.125% Fixed-Rate Reset
Non-Cumulative
Preferred Stock, Series TT (the “Series TT Preferred Stock”), having a liquidation preference of $25,000 per share, 80,000 shares of which were issued and outstanding;
•
21,000 shares were designated as Floating Rate
Non-Cumulative
Preferred Stock, Series 1 (the “Series 1 Preferred Stock”), having a liquidation preference of $30,000 per share, 3,185 shares of which were issued and outstanding;
•
37,000 shares were designated as Floating Rate
Non-Cumulative
Preferred Stock, Series 2 (the “Series 2 Preferred Stock”), having a liquidation preference of $30,000 per share, 9,967 shares of which were issued and outstanding;
•
20,000 shares were designated as Floating Rate
Non-Cumulative
Preferred Stock, Series 4 (the “Series 4 Preferred Stock”), having a liquidation preference of $30,000 per share, 7,010 shares of which were issued and outstanding; and
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•
50,000 shares were designated as Floating Rate
Non-Cumulative
Preferred Stock, Series 5 (the “Series 5 Preferred Stock”), having a liquidation preference of $30,000 per share, 13,331 shares of which were issued and outstanding.
In addition, as of the date of this prospectus, the following series of preferred stock were designated, but no shares of any of these series
were outstanding:
•
3 million shares of ESOP Convertible Preferred Stock, Series C;
•
20 million shares of $2.50 Cumulative Convertible Preferred Stock, Series BB;
•
50,000 shares of 6%
Non-Cumulative
Perpetual Preferred Stock, Series T;
•
44,000 shares of 6.500%
Non-Cumulative
Preferred Stock, Series Y;
•
44,000 shares of 6.200%
Non-Cumulative
Preferred Stock, Series CC; and
•
36,000 shares of 6.000%
Non-Cumulative
Preferred Stock, Series EE.
The following summarizes the general terms and provisions of our Series B Preferred Stock, Series E Preferred Stock,
Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock and Series 5 Preferred Stock. As of their respective original issue dates, the terms of the Series E
Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series JJ Preferred
Stock, Series MM Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock and Series 5 Preferred Stock (together, the “LIBOR Preferred Stock”) provided for dividend rates to be determined by reference
to three-month U.S. dollar LIBOR (“Three-Month USD LIBOR”) for some or all applicable dividend periods. Three-Month USD LIBOR ceased publication following June 30, 2023. In accordance with the U.S. Adjustable Interest Rate (LIBOR)
Act and Regulation ZZ promulgated thereunder by the Board of Governors of the Federal Reserve System, and/or the applicable fallback provisions relating to Three-Month USD LIBOR contained in the applicable series of LIBOR Preferred Stock, the
three-month CME Term SOFR Reference Rate, as administered by CME Group Benchmark Administration, Ltd. (or any successor administrator thereof), plus a tenor spread adjustment of 0.26161% (such rate, including such tenor spread adjustment,
“Adjusted Three-Month Term SOFR”) replaced Three-Month USD LIBOR as the reference rate for the determinations of dividend rates and calculations of dividend payments for all series of the LIBOR Preferred Stock for all dividend periods
commencing on or after the first London banking date after June 30, 2023 (the “LIBOR Replacement Date”). The replacement of Three-Month USD LIBOR as the replacement rate for each of the LIBOR Preferred Stock with Adjusted
Three-Month Term SOFR is effective for determinations under the terms of the LIBOR Preferred Stock that are made on and after the LIBOR Replacement Date, but will not affect any determinations made prior to the LIBOR Replacement Date. In the
descriptions of the LIBOR Preferred Stock set forth below, references to Three-Month USD LIBOR contained in the original terms of such preferred stock accordingly have been changed to Adjusted Three-Month Term SOFR. You also should refer to our
Restated Certificate of Incorporation and the respective certificate of designations for each series, which are on file with the SEC.
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Series B Preferred Stock
Preferential Rights
. The Series B Preferred Stock ranks senior to the common stock and ranks equally with the Series E Preferred Stock,
Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on liquidation. Shares of the Series
B Preferred Stock are not convertible into or exchangeable for any shares of common stock or any other class of our capital stock. We may issue stock with preferences senior or equal to the Series B Preferred Stock without the consent of holders of
Series B Preferred Stock.
Dividends
. Holders of shares of Series B Preferred Stock are entitled to receive, when and as declared
by our board of directors, cumulative cash dividends at an annual dividend rate per share of 7.00% of the stated value per share of Series B Preferred Stock. The stated value per share of the Series B Preferred Stock is $100. Dividends are payable
quarterly. We cannot declare or pay cash dividends on any shares of common stock unless full cumulative dividends on the Series B Preferred Stock have been paid or declared and funds sufficient for the payment have been set apart.
Voting Rights
. Each share of Series B Preferred Stock has equal voting rights, share for share, with each share of common stock.
Distributions
. In the event of our voluntary or involuntary dissolution, liquidation, or winding up, the holders of Series B Preferred
Stock are entitled to receive, after payment of the full liquidation preference on shares of any class of preferred stock ranking senior to Series B Preferred Stock, but before any distribution on shares of common stock, liquidating distributions in
the amount of the liquidation preference of $100 per share plus accumulated dividends.
Redemption
. Shares of Series B Preferred
Stock are redeemable, in whole or in part, at the option of the holders, at the redemption price of $100 per share plus accumulated dividends, provided that (1) full cumulative dividends have been paid, or declared, and funds sufficient for
payment set apart, upon any class or series of preferred stock ranking senior to the Series B Preferred Stock; and (2) we are not then in default or in arrears on any sinking fund or analogous fund or call for tenders obligation or agreement
for the purchase of any class or series of preferred stock ranking senior to Series B Preferred Stock.
Series E Preferred Stock
Preferential Rights.
The Series E Preferred Stock ranks senior to our common stock and ranks equally with the Series B
Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred
Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock,
Series RR Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation,
dissolution, or winding up. Series E Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series E
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Preferred Stock do not have any preemptive rights. We may issue stock with preferences superior or equal to the Series E Preferred Stock without the consent of the holders of the Series E
Preferred Stock.
Dividends.
Holders of the Series E Preferred Stock are entitled to receive cash dividends when, as, and if
declared by our board of directors or a duly authorized committee thereof, on the liquidation preference of $25,000 per share at an annual rate per share equal to the greater of (a) Adjusted Three-Month Term SOFR (
provided
,
however
, that, for dividend periods commencing prior to the LIBOR Replacement Date, the dividend rate was determined by reference to Three-Month USD LIBOR) plus a spread of 0.35%, and (b) 4.00%. Dividends on the Series E Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series E Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital stock
ranking junior to the Series E Preferred Stock unless full dividends on all outstanding shares of Series E Preferred Stock for the then-current dividend period have been paid in full or declared and a sum sufficient for the payment thereof set
aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series E Preferred Stock for any period unless full dividends on all outstanding shares of Series E Preferred Stock for the then-current dividend period have
been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series E Preferred Stock and on any capital stock ranking equally with the Series E Preferred Stock but cannot make full payment of
those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series E Preferred Stock and the holders of any capital stock ranking equally with the Series E Preferred Stock.
Voting Rights.
Holders of Series E Preferred Stock do not have voting rights, except as specifically required by Delaware law and in
the case of certain dividend arrearages in relation to the Series E Preferred Stock. If any quarterly dividend payable on the Series E Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend
periods, the holders of the Series E Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series E Preferred Stock as to payment of dividends and upon which
voting rights equivalent to those granted to the holders of Series E Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series E Preferred Stock for at
least four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate.
Distributions.
In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series E Preferred
Stock are entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series E
Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation.
Shares of Series E Preferred Stock are not subject to a sinking fund.
Redemption.
We may redeem the Series E Preferred Stock in
whole or in part, at our option, on any dividend payment date for the Series E Preferred Stock, at the redemption price equal to $25,000 per share, plus any declared and unpaid dividends.
Series F Preferred Stock
Preferential Rights.
The Series F Preferred Stock ranks senior to our common stock and ranks equally with the Series B Preferred Stock,
Series E Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred
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Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock,
Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series
2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or winding up. The Series F Preferred Stock is not convertible into or exchangeable for any shares of our
common stock or any other class of our capital stock. Holders of the Series F Preferred Stock do not have any preemptive rights. We may issue stock with preferences superior or equal to the Series F Preferred Stock without the consent of the holders
of the Series F Preferred Stock.
Dividends.
Holders of the Series F Preferred Stock are entitled to receive cash dividends, when,
as, and if declared by our board of directors or a duly authorized committee thereof out of funds legally available for payment, on the liquidation preference of $100,000 per share of Series F Preferred Stock. Dividends on each share of Series F
Preferred Stock will accrue on the liquidation preference of $100,000 per share at a rate per year equal to the greater of (a) Adjusted Three-Month Term SOFR (
provided
,
however
, that, for dividend periods commencing prior to the
LIBOR Replacement Date, the dividend rate was determined by reference to Three-Month USD LIBOR) plus a spread of 0.40%, and (b) 4.00%. Dividends on the Series F Preferred Stock are
non-cumulative
and are
payable quarterly in arrears. As long as shares of Series F preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series F Preferred Stock unless
full dividends on all outstanding shares of Series F Preferred Stock for the then-current dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital
stock ranking equally with the Series F Preferred Stock unless full dividends on all outstanding shares of Series F Preferred Stock for the then-current dividend period have been paid in full or declared and a sum sufficient for the payment thereof
set aside. If we declare dividends on the Series F Preferred Stock and on any capital stock ranking equally with the Series F Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro
rata basis among the holders of the shares of Series F Preferred Stock and the holders of any capital stock ranking equally with the Series F Preferred Stock.
Voting Rights.
Holders of Series F Preferred Stock do not have voting rights, except as specifically required by Delaware law.
Distributions.
In the event of our voluntary of involuntary liquidation, dissolution, or winding up, holders of Series F Preferred
Stock are entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series F
Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $100,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation.
Shares of Series F Preferred Stock are not subject to a sinking fund.
Redemption.
We may redeem the Series F Preferred Stock, in
whole or in part, at our option, on any dividend payment date for the Series F Preferred Stock at the redemption price equal to $100,000 per share, plus dividends that have been declared but not paid plus any accrued and unpaid dividends for the
then-current dividend period to the redemption date.
Series G Preferred Stock
Preferential Rights.
The Series G Preferred Stock ranks senior to our common stock and ranks equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock,
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Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. The Series G Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series G Preferred Stock do not have any preemptive rights. We may issue
stock with preferences superior or equal to the Series G Preferred Stock without the consent of the holders of the Series G Preferred Stock.
Dividends.
Holders of the Series G Preferred Stock are entitled to receive cash dividends when, as, and if declared by our board of
directors or a duly authorized committee thereof out of funds legally available for payment, on the liquidation preference of $100,000 per share of Series G Preferred Stock, payable quarterly in arrears. Dividends on each share of Series G Preferred
Stock will accrue on the liquidation preference of $100,000 per share at a rate per year equal to the greater of (a) Adjusted Three-Month Term SOFR (
provided
,
however
, that, for dividend periods commencing prior to the LIBOR
Replacement Date, the dividend rate was determined by reference to Three-Month USD LIBOR) plus a spread of 0.40%, and (b) 4.00%. Dividends on the Series G Preferred Stock are
non-cumulative.
As long as shares
of Series G Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series G Preferred Stock unless full dividends on all outstanding shares of Series
G Preferred Stock for the then-current dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series G Preferred
Stock unless full dividends on all outstanding shares of Series G Preferred Stock for the then-current dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series G
Preferred Stock and on any capital stock ranking equally with the Series G Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series
G Preferred Stock and the holders of any capital stock ranking equally with the Series G Preferred Stock.
Voting Rights.
Holders
of Series G Preferred Stock do not have voting rights, except as specifically required by Delaware law.
Distributions.
In the
event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series G Preferred Stock are entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of
our assets may be made to or set aside for the holders of capital stock ranking junior to the Series G Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $100,000 per share, plus any
declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series G Preferred Stock are not subject to a sinking fund.
Redemption.
We may redeem the Series G Preferred Stock, in whole or in part, at our option, on any dividend payment date for the Series
G Preferred Stock at the redemption price equal to $100,000 per share, plus dividends that have been declared but not paid plus any accrued and unpaid dividends for the then-current dividend period to the redemption date.
Series L Preferred Stock
Preferential Rights.
The Series L Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock,
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Series G Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Holders of the Series L Preferred Stock do not have any preemptive rights. We may issue stock with preferences superior or equal to the Series L Preferred Stock without the consent of the holders of the Series L Preferred Stock.
Dividends.
Holders of the Series L Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, at an annual dividend rate per share of 7.25% on the liquidation preference of $1,000 per share. Dividends on the Series L Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series L Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of common stock or other capital stock ranking junior to the Series L Preferred Stock
unless full dividends on all outstanding shares of Series L Preferred Stock for the then-current dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on
capital stock ranking equally with the Series L Preferred Stock for any period unless full dividends on all outstanding shares of Series L Preferred Stock for the then-current dividend period have been paid in full or declared and a sum sufficient
for the payment thereof set aside. If we declare dividends on the Series L Preferred Stock and on any capital stock ranking equally with the Series L Preferred Stock but cannot make full payment of those declared dividends, we will allocate the
dividend payments on a pro rata basis among the holders of the shares of Series L Preferred Stock and the holders of any capital stock ranking equally with the Series L Preferred Stock.
Conversion Right.
Each share of the Series L Preferred Stock may be converted at any time, at the option of the holder, into 20 shares
of our common stock (which reflects an initial conversion price of $50.00 per share of common stock) plus cash in lieu of fractional shares, subject to anti-dilution adjustments.
Conversion at Our Option.
We may, at our option, at any time or from time to time, cause some or all of the Series L Preferred Stock to
be converted into shares of our common stock at the then-applicable conversion rate if, for 20 trading days during any period of 30 consecutive trading days, the closing price of our common stock exceeds 130% of the then-applicable conversion price
of the Series L Preferred Stock.
Conversion Upon Certain Acquisitions.
If a make-whole acquisition occurs, holders of Series L
Preferred Stock may cause this Series L Preferred Stock held by such holder to be converted into shares of our common stock, and we will, under certain circumstances, increase the conversion rate in respect of such conversions of the Series L
Preferred Stock that occur during the period beginning on the effective date of the make-whole acquisition and ending on the date that is 30 days after the effective date by a number of additional shares of common stock. The amount of the make-whole
adjustment, if any, will be based upon the price per share of our common stock and the effective date of the make-whole acquisition. Subject to certain exceptions, a “make-whole acquisition” occurs in the event of (1) the
acquisition by a person or group of more than 50% of the voting power of our common stock, or (2) our consolidation or merger where we are not the surviving entity.
Conversion Upon Fundamental Change.
In lieu of receiving the make-whole shares described above, if the reference price (as defined
below) in connection with a make-whole acquisition is less
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than the applicable conversion price (a “fundamental change”), a holder may elect to convert each share of the Series L Preferred Stock during the period beginning on the effective
date of the fundamental change and ending on the date that is 30 days after the effective date of such fundamental change at an adjusted conversion price equal to the greater of (1) the “reference price,” which is the price per
share of our common stock paid in the event of a fundamental change, and (2) $19.95, which is 50% of the closing price of our common stock on January 24, 2008, the date of the initial offering of the Series L Preferred Stock, subject to
adjustment (the “base price”). If the reference price is less than the base price, holders of the Series L Preferred Stock will receive a maximum of 50.1253 shares of our common stock per share of Series L Preferred Stock, subject to
adjustment, which may result in a holder receiving value that is less than the liquidation preference of the Series L Preferred Stock.
Anti-Dilution Adjustments.
The conversion rate may be adjusted in the event of, among other things, (1) stock dividend
distributions, (2) subdivisions, splits, and combinations of our common stock, (3) issuance of stock purchase rights, (4) debt or asset distributions, (5) increases in cash dividends, and (6) tender or exchange offers for
our common stock.
Voting Rights.
Holders of Series L Preferred Stock do not have voting rights, except as specifically required by
Delaware law and in the case of certain dividend arrearages in relation to the Series L Preferred Stock. If any quarterly dividend payable on the Series L Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for
consecutive dividend periods, the holders of the Series L Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series L Preferred Stock as to payment of
dividends and upon which voting rights equivalent to those granted to the holders of Series L Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series
L Preferred Stock for at least four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate.
Liquidation Rights.
In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series L Preferred
Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series L
Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $1,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation.
Shares of Series L Preferred Stock will not be subject to a sinking fund.
Redemption.
We do not have any rights to redeem the
Series L Preferred Stock.
Series U Preferred Stock
Preferential Rights.
The Series U Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series U Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series U
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Preferred Stock do not have any preemptive rights. We may issue stock with preferences equal to the Series U Preferred Stock without the consent of the holders of the Series U Preferred Stock.
Dividends.
Holders of the Series U Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board
of directors or a duly authorized committee thereof, for each semi-annual dividend period from the issue date to, but excluding, June 1, 2023, at a rate of 5.20% per annum on the liquidation preference of $25,000 per share, payable semiannually
in arrears, and, for each quarterly dividend period from June 1, 2023 through the redemption date of the Series U Preferred Stock, at a floating rate equal to Adjusted Three-Month Term SOFR (
provided
,
however
, that, for the
dividend period commencing prior to the LIBOR Replacement Date, the dividend rate was determined by reference to Three-Month USD LIBOR) plus a spread of 3.135% per annum on the liquidation preference of $25,000 per share, payable quarterly in
arrears. Dividends on the Series U Preferred Stock are
non-cumulative.
As long as shares of Series U Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common
stock or other capital stock ranking junior to the Series U Preferred Stock unless full dividends on all outstanding shares of Series U Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum
sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series U Preferred Stock for any period unless full dividends on all outstanding shares of Series U Preferred Stock for
the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series U Preferred Stock and on any capital stock ranking equally with the Series U
Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series U Preferred Stock and the holders of any capital stock ranking equally
with the Series U Preferred Stock.
Voting Rights.
Holders of Series U Preferred Stock do not have voting rights, except as
described herein and as specifically required by Delaware law. If any dividend payable on the Series U Preferred Stock is in arrears for three or more semi-annual dividend periods or six or more quarterly dividend periods, as applicable, whether or
not for consecutive dividend periods, the holders of the Series U Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series U Preferred Stock as to payment of
dividends and upon which voting rights equivalent to those granted to the holders of Series U Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series
U Preferred Stock for at least two semi-annual or four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series U Preferred Stock remains outstanding, the affirmative vote
or consent of the holders of at least 66 2/3% of the voting power of the Series U Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series U Preferred Stock as to
dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security
convertible into or evidencing the right to purchase any such shares of capital stock. In addition, so long as any shares of the Series U Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power
of the Series U Preferred Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series U Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or
special rights of the Series U Preferred Stock.
Distributions.
In the event of our voluntary or involuntary liquidation,
dissolution, or winding up, holders of Series U Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the
holders of our capital stock ranking junior to the Series U Preferred Stock as to
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distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared
dividends, to the date of liquidation. Shares of Series U Preferred Stock will not be subject to a sinking fund.
Redemption.
We
may redeem the Series U Preferred Stock, in whole or in part, at our option, at any time on or after June 1, 2023, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period
to but excluding the redemption date, without accumulation of any undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series U Preferred
Stock, we may redeem the Series U Preferred Stock, in whole but not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without
accumulation of any undeclared dividends.
Series X Preferred Stock
Preferential Rights.
The Series X Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series X Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series X Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series X Preferred Stock without the consent of the holders of the Series X Preferred Stock.
Dividends.
Holders of the Series X Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, for each semi-annual dividend period from the issue date to, but excluding, September 5, 2024, at a rate of 6.250% per annum on the liquidation preference of $25,000 per share, payable
semiannually in arrears, and, for each quarterly dividend period from September 5, 2024 through the redemption date of the Series X Preferred Stock, at a floating rate equal to Adjusted Three-Month Term SOFR plus a spread of 3.705% per annum on
the liquidation preference of $25,000 per share, payable quarterly in arrears. Dividends on the Series X Preferred Stock are
non-cumulative.
As long as shares of Series X Preferred Stock remain outstanding, we
cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series X Preferred Stock unless full dividends on all outstanding shares of Series X Preferred Stock for the immediately preceding
dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series X Preferred Stock for any period unless full
dividends on all outstanding shares of Series X Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series X
Preferred Stock and on any capital stock ranking equally with the Series X Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series
X Preferred Stock and the holders of any capital stock ranking equally with the Series X Preferred Stock.
Voting Rights
. Holders
of Series X Preferred Stock do not have voting rights, except as described herein and as specifically required by Delaware law. If any dividend payable on the
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Series X Preferred Stock is in arrears for three or more semi-annual dividend periods or six or more quarterly dividend periods, as applicable, whether or not for consecutive dividend periods,
the holders of the Series X Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series X Preferred Stock as to payment of dividends and upon which voting rights
equivalent to those granted to the holders of Series X Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series X Preferred Stock for at least two
semi-annual or four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series X Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at
least 66 2/3% of the voting power of the Series X Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series X Preferred Stock as to dividends or the distribution
of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or
evidencing the right to purchase any such shares of capital stock. In addition, so long as any shares of the Series X Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the
Series X Preferred Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series X Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or
special rights of the Series X Preferred Stock.
Distributions.
In the event of our voluntary or involuntary liquidation,
dissolution, or winding up, holders of Series X Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the
holders of our capital stock ranking junior to the Series X Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without
accumulation of any undeclared dividends, to the date of liquidation. Shares of Series X Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series X Preferred Stock, in whole or in part, at our option, at any time on or after September 5,
2024, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends. In addition, at any time
within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series X Preferred Stock, we may redeem the Series X Preferred Stock, in whole but not in part, at a redemption price equal to
$25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends.
Series Z Preferred Stock
Preferential Rights.
The Series Z Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series Z Preferred Stock is not convertible into or exchangeable for any
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shares of our common stock or any other class of our capital stock. Holders of the Series Z Preferred Stock do not have any preemptive rights. We may issue stock with preferences equal to the
Series Z Preferred Stock without the consent of the holders of the Series Z Preferred Stock.
Dividends.
Holders of the Series Z
Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of directors or a duly authorized committee thereof, for each semi-annual dividend period from the issue date to, but excluding, October 23, 2024, at
a rate of 6.500% per annum on the liquidation preference of $25,000 per share, payable semiannually in arrears, and, for each quarterly dividend period from October 23, 2024 through the redemption date of the Series Z Preferred Stock, at a
floating rate equal to Adjusted Three-Month Term SOFR plus a spread of 4.174% per annum on the liquidation preference of $25,000 per share, payable quarterly in arrears. Dividends on the Series Z Preferred Stock are
non-cumulative.
As long as shares of Series Z Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series Z
Preferred Stock unless full dividends on all outstanding shares of Series Z Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or
pay cash dividends on capital stock ranking equally with the Series Z Preferred Stock for any period unless full dividends on all outstanding shares of Series Z Preferred Stock for the immediately preceding dividend period have been paid in full or
declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series Z Preferred Stock and on any capital stock ranking equally with the Series Z Preferred Stock but cannot make full payment of those declared
dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series Z Preferred Stock and the holders of any capital stock ranking equally with the Series Z Preferred Stock.
Voting Rights
. Holders of Series Z Preferred Stock do not have voting rights, except as described herein and as specifically required
by Delaware law. If any dividend payable on the Series Z Preferred Stock is in arrears for three or more semi-annual dividend periods or six or more quarterly dividend periods, as applicable, whether or not for consecutive dividend periods, the
holders of the Series Z Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series Z Preferred Stock as to payment of dividends and upon which voting rights
equivalent to those granted to the holders of Series Z Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series Z Preferred Stock for at least two
semi-annual or four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series Z Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at
least 66 2/3% of the voting power of the Series Z Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series Z Preferred Stock as to dividends or the distribution of
assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing
the right to purchase any such shares of capital stock. In addition, so long as any shares of the Series Z Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series Z Preferred
Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series Z Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the
Series Z Preferred Stock.
Distributions.
In the event of our voluntary or involuntary liquidation, dissolution, or winding up,
holders of Series Z Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock
ranking junior to the Series Z Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per
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share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series Z Preferred Stock will not be subject to a sinking
fund.
Redemption
. We may redeem the Series Z Preferred Stock, in whole or in part, at our option, at any time on or after
October 23, 2024, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends. In
addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series Z Preferred Stock, we may redeem the Series Z Preferred Stock, in whole but not in part, at a
redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends.
Series AA Preferred Stock
Preferential Rights
. The Series AA Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series AA Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series AA Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series AA Preferred Stock without the consent of the holders of the Series AA Preferred Stock.
Dividends.
Holders of the Series AA Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, for each semi-annual dividend period from the issue date to, but excluding, March 17, 2025, at a rate of 6.100% per annum on the liquidation preference of $25,000 per share, payable semiannually
in arrears, and, for each quarterly dividend period from March 17, 2025 through the redemption date of the Series AA Preferred Stock, at a floating rate equal to Adjusted Three-Month Term SOFR plus a spread of 3.898% per annum on the
liquidation preference of $25,000 per share, payable quarterly in arrears. Dividends on the Series AA Preferred Stock are
non-cumulative.
As long as shares of Series AA Preferred Stock remain outstanding, we
cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series AA Preferred Stock unless full dividends on all outstanding shares of Series AA Preferred Stock for the immediately preceding
dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series AA Preferred Stock for any period unless full
dividends on all outstanding shares of Series AA Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series AA
Preferred Stock and on any capital stock ranking equally with the Series AA Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of
Series AA Preferred Stock and the holders of any capital stock ranking equally with the Series AA Preferred Stock.
Voting Rights
.
Holders of Series AA Preferred Stock do not have voting rights, except as described herein and as specifically required by Delaware law. If any dividend payable on the Series AA Preferred Stock is in arrears for three or more semi-annual dividend
periods or six or
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more quarterly dividend periods, as applicable, whether or not for consecutive dividend periods, the holders of the Series AA Preferred Stock will be entitled to vote as a class, together with
the holders of all series of our preferred stock ranking equally with the Series AA Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the holders of Series AA Preferred Stock have been conferred
and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series AA Preferred Stock for at least two semi-annual or four quarterly dividend periods following a dividend arrearage described above,
these voting rights will terminate. As long as the Series AA Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the voting power of the Series AA Preferred Stock and any voting parity stock
shall be necessary to authorize, create or issue any capital stock ranking senior to the Series AA Preferred Stock as to dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or
to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to purchase any such shares of capital stock. In addition, so long as any shares of
the Series AA Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series AA Preferred Stock shall be necessary to amend, alter or repeal any provision of the certificate of
designations for the Series AA Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the Series AA Preferred Stock.
Distributions
. In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series AA Preferred
Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series AA
Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation.
Shares of Series AA Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series AA Preferred
Stock, in whole or in part, at our option, at any time on or after March 17, 2025, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption
date, without accumulation of any undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series AA Preferred Stock, we may redeem the
Series AA Preferred Stock, in whole but not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any
undeclared dividends.
Series DD Preferred Stock
Preferential Rights
. The Series DD Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series FF Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series DD Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series DD Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series DD Preferred Stock without the consent of the holders of the Series DD Preferred Stock.
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Dividends
. Holders of the Series DD Preferred Stock are entitled to receive cash
dividends, when, as, and if declared by our board of directors or a duly authorized committee thereof, for each semi-annual dividend period from the issue date to, but excluding, March 10, 2026, at a rate of 6.300% per annum on the liquidation
preference of $25,000 per share, payable semiannually in arrears, and, for each quarterly dividend period from March 10, 2026 through the redemption date of the Series DD Preferred Stock, at a floating rate equal to Adjusted Three-Month Term
SOFR plus a spread of 4.553% per annum on the liquidation preference of $25,000 per share, payable quarterly in arrears. Dividends on the Series DD Preferred Stock are
non-cumulative.
As long as shares of
Series DD Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series DD Preferred Stock unless full dividends on all outstanding shares of Series
DD Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series DD
Preferred Stock for any period unless full dividends on all outstanding shares of Series DD Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If
we declare dividends on the Series DD Preferred Stock and on any capital stock ranking equally with the Series DD Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis
among the holders of the shares of Series DD Preferred Stock and the holders of any capital stock ranking equally with the Series DD Preferred Stock.
Voting Rights
. Holders of Series DD Preferred Stock do not have voting rights, except as described herein and as specifically required
by Delaware law. If any dividend payable on the Series DD Preferred Stock is in arrears for three or more semi-annual dividend periods or six or more quarterly dividend periods, as applicable, whether or not for consecutive dividend periods, the
holders of the Series DD Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series DD Preferred Stock as to payment of dividends and upon which voting rights
equivalent to those granted to the holders of Series DD Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series DD Preferred Stock for at least two
semi-annual or four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series DD Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at
least 66 2/3% of the voting power of the Series DD Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series DD Preferred Stock as to dividends or the distribution of
assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing
the right to purchase any such shares of capital stock. In addition, so long as any shares of the Series DD Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series DD Preferred
Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series DD Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the
Series DD Preferred Stock.
Distributions
. In the event of our voluntary or involuntary liquidation, dissolution, or winding up,
holders of Series DD Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock
ranking junior to the Series DD Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared
dividends, to the date of liquidation. Shares of Series DD Preferred Stock will not be subject to a sinking fund.
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Redemption.
We may redeem the Series DD Preferred Stock, in whole or in part, at our
option, at any time on or after March 10, 2026, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption date, without accumulation of any
undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series DD Preferred Stock, we may redeem the Series DD Preferred Stock, in whole but
not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends.
Series FF Preferred Stock
Preferential Rights
. The Series FF Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series GG
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series FF Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series FF Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series FF Preferred Stock without the consent of the holders of the Series FF Preferred Stock.
Dividends
. Holders of the Series FF Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, for each semi-annual dividend period from the issue date to, but excluding, March 15, 2028, at a rate of 5.875% per annum on the liquidation preference of $25,000 per share, payable semiannually
in arrears, and, for each quarterly dividend period from March 15, 2028 through the redemption date of the Series FF Preferred Stock, at a floating rate equal to Adjusted Three-Month Term SOFR plus a spread of 2.931% per annum on the
liquidation preference of $25,000 per share, payable quarterly in arrears. Dividends on the Series FF Preferred Stock are
non-
cumulative. As long as shares of Series FF Preferred Stock remain outstanding, we
cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series FF Preferred Stock unless full dividends on all outstanding shares of Series FF Preferred Stock for the immediately preceding
dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series FF Preferred Stock for any period unless full
dividends on all outstanding shares of Series FF Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series FF
Preferred Stock and on any capital stock ranking equally with the Series FF Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of
Series FF Preferred Stock and the holders of any capital stock ranking equally with the Series FF Preferred Stock.
Voting Rights
.
Holders of Series FF Preferred Stock do not have voting rights, except as described herein and as specifically required by Delaware law. If any dividend payable on the Series FF Preferred Stock is in arrears for three or more semi-annual dividend
periods or six or more quarterly dividend periods, as applicable, whether or not for consecutive dividend periods, the holders of the Series FF Preferred Stock will be entitled to vote as a class, together with the holders of all series of our
preferred stock ranking equally with the Series FF Preferred Stock as to
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payment of dividends and upon which voting rights equivalent to those granted to the holders of Series FF Preferred Stock have been conferred and are exercisable, for the election of two
Preferred Stock Directors. When we have paid full dividends on the Series FF Preferred Stock for at least two semi-annual or four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long
as the Series FF Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the voting power of the Series FF Preferred Stock and any voting parity stock shall be necessary to authorize, create or
issue any capital stock ranking senior to the Series FF Preferred Stock as to dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock
into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to purchase any such shares of capital stock. In addition, so long as any shares of the Series FF Preferred Stock remain
outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series FF Preferred Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series FF Preferred Stock
or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the Series FF Preferred Stock.
Distributions
. In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series FF Preferred
Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series FF
Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation.
Shares of Series FF Preferred Stock will not be subject to a sinking fund.
Redemption.
We may redeem the Series FF Preferred
Stock, in whole or in part, at our option, at any time on or after March 15, 2028, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption
date, without accumulation of any undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series FF Preferred Stock, we may redeem the
Series FF Preferred Stock, in whole but not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any
undeclared dividends.
Series GG Preferred Stock
Preferential Rights.
The Series GG Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series GG Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series GG Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series GG Preferred Stock without the consent of the holders of the Series GG Preferred Stock.
Dividends
. Holders of the Series GG Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, at an annual dividend rate per share of 6.000% on the liquidation preference of $25,000 per share.
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Dividends on the Series GG Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series GG Preferred Stock remain
outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series GG Preferred Stock unless full dividends on all outstanding shares of Series GG Preferred Stock for the
immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series GG Preferred Stock for any
period unless full dividends on all outstanding shares of Series GG Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on
the Series GG Preferred Stock and on any capital stock ranking equally with the Series GG Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the
shares of Series GG Preferred Stock and the holders of any capital stock ranking equally with the Series GG Preferred Stock.
Voting
Rights
. Holders of Series GG Preferred Stock do not have voting rights, except as described herein and as specifically required by Delaware law. If any dividend payable on the Series GG Preferred Stock is in arrears for six or more quarterly
dividend periods, whether or not for consecutive dividend periods, the holders of the Series GG Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series GG
Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the holders of Series GG Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have
paid full dividends on the Series GG Preferred Stock for at least four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series GG Preferred Stock remains outstanding, the
affirmative vote or consent of the holders of at least 66 2/3% of the voting power of the Series GG Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series GG
Preferred Stock as to dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any
obligation or security convertible into or evidencing the right to purchase any such shares of capital stock. In addition, so long as any shares of the Series GG Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66
2/3% of the voting power of the Series GG Preferred Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series GG Preferred Stock or our certificate of incorporation so as to adversely affect
the powers, preferences or special rights of the Series GG Preferred Stock.
Distributions
. In the event of our voluntary or
involuntary liquidation, dissolution, or winding up, holders of Series GG Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made
to or set aside for the holders of our capital stock ranking junior to the Series GG Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid
dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series GG Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series GG Preferred Stock, in whole or in part, at our option, at any time on or after May 16, 2023,
at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends. In addition, at any time within
90 days after a “capital treatment event,” as described in the certificate of designations for the Series GG Preferred Stock, we may redeem the Series GG Preferred Stock, in whole but not in part, at a redemption price equal to $25,000
per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends.
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Series HH Preferred Stock
Preferential Rights.
The Series HH Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series GG Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series HH Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series HH Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series HH Preferred Stock without the consent of the holders of the Series HH Preferred Stock.
Dividends.
Holders of the Series HH Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, at an annual dividend rate per share of 5.875% on the liquidation preference of $25,000 per share. Dividends on the Series HH Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series HH Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other
capital stock ranking junior to the Series HH Preferred Stock unless full dividends on all outstanding shares of Series HH Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the
payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series HH Preferred Stock for any period unless full dividends on all outstanding shares of Series HH Preferred Stock for the immediately
preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series HH Preferred Stock and on any capital stock ranking equally with the Series HH Preferred Stock
but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series HH Preferred Stock and the holders of any capital stock ranking equally with the Series HH
Preferred Stock.
Voting Rights.
Holders of Series HH Preferred Stock do not have voting rights, except as described herein and as
specifically required by Delaware law. If any dividend payable on the Series HH Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the Series HH Preferred Stock
will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series HH Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the holders
of Series HH Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series HH Preferred Stock for at least four quarterly dividend periods following a
dividend arrearage described above, these voting rights will terminate. As long as the Series HH Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the voting power of the Series HH Preferred
Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series HH Preferred Stock as to dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to purchase any such shares of
capital stock. In addition, so long as any shares of the Series HH Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series HH Preferred
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Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series HH Preferred Stock or our certificate of incorporation so as to adversely affect
the powers, preferences or special rights of the Series HH Preferred Stock.
Distributions
. In the event of our voluntary or
involuntary liquidation, dissolution, or winding up, holders of Series HH Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made
to or set aside for the holders of our capital stock ranking junior to the Series HH Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid
dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series HH Preferred Stock will not be subject to a sinking fund.
Redemption.
We may redeem the Series HH Preferred Stock, in whole or in part, at our option, at any time on or after July 24,
2023, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends. In addition, at any time
within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series HH Preferred Stock, we may redeem the Series HH Preferred Stock, in whole but not in part, at a redemption price equal to
$25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends.
Series JJ Preferred Stock
Preferential Rights.
The Series JJ Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series JJ Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series JJ Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series JJ Preferred Stock without the consent of the holders of the Series JJ Preferred Stock.
Dividends.
Holders of the Series JJ Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, (i) for each semi-annual dividend period from the issue date to, but excluding, June 20, 2024, at a rate of 5.125% per annum on the liquidation preference of $25,000 per share, payable
semiannually in arrears, and, (ii) for each quarterly dividend period from June 20, 2024 through the redemption date of the Series JJ Preferred Stock, at a floating rate equal Adjusted Three-Month Term SOFR plus a spread of 3.292% per
annum on the liquidation preference of $25,000 per share, payable quarterly in arrears. Dividends on the Series JJ Preferred Stock are
non-cumulative.
As long as shares of Series JJ Preferred Stock remain
outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series JJ Preferred Stock unless full dividends on all outstanding shares of Series JJ Preferred Stock for the
immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series JJ Preferred Stock for any
period unless full dividends on all outstanding shares of Series JJ Preferred Stock for the immediately preceding dividend period have been paid
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in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series JJ Preferred Stock and on any capital stock ranking equally with the Series JJ
Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series JJ Preferred Stock and the holders of any capital stock ranking equally
with the Series JJ Preferred Stock.
Voting Rights.
Holders of Series JJ Preferred Stock do not have voting rights, except as
described herein and as specifically required by Delaware law. If any dividend payable on the Series JJ Preferred Stock is in arrears for three or more semi-annual dividend periods or six or more quarterly dividend periods, as applicable, whether or
not for consecutive dividend periods, the holders of the Series JJ Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series JJ Preferred Stock as to payment
of dividends and upon which voting rights equivalent to those granted to the holders of Series JJ Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the
Series JJ Preferred Stock for at least two semi-annual or four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series JJ Preferred Stock remains outstanding, the
affirmative vote or consent of the holders of at least 66 2/3% of the voting power of the Series JJ Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series JJ
Preferred Stock as to dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any
obligation or security convertible into or evidencing the right to purchase any such shares of capital stock. In addition, so long as any shares of the Series JJ Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66
2/3% of the voting power of the Series JJ Preferred Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series JJ Preferred Stock or our certificate of incorporation so as to adversely affect
the powers, preferences or special rights of the Series JJ Preferred Stock.
Distributions.
In the event of our voluntary or
involuntary liquidation, dissolution, or winding up, holders of Series JJ Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made
to or set aside for the holders of our capital stock ranking junior to the Series JJ Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid
dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series JJ Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series JJ Preferred Stock, in whole or in part, at our option, at any time on or after June 20,
2024, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends. In addition, at any time
within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series JJ Preferred Stock, we may redeem the Series JJ Preferred Stock, in whole but not in part, at a redemption price equal to
$25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends.
Series KK Preferred Stock
Preferential Rights.
The Series KK Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
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Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP
Preferred Stock, Series QQ Preferred Stock, Series RR Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends
and distributions on our liquidation, dissolution, or winding up. Series KK Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series KK Preferred Stock
do not have any preemptive rights. We may issue stock with preferences equal to the Series KK Preferred Stock without the consent of the holders of the Series KK Preferred Stock.
Dividends.
Holders of the Series KK Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, at an annual dividend rate per share of 5.375% on the liquidation preference of $25,000 per share. Dividends on the Series KK Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series KK Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other
capital stock ranking junior to the Series KK Preferred Stock unless full dividends on all outstanding shares of Series KK Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the
payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series KK Preferred Stock for any period unless full dividends on all outstanding shares of Series KK Preferred Stock for the immediately
preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series KK Preferred Stock and on any capital stock ranking equally with the Series KK Preferred Stock
but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series KK Preferred Stock and the holders of any capital stock ranking equally with the Series KK
Preferred Stock.
Voting Rights.
Holders of Series KK Preferred Stock do not have voting rights, except as described herein and as
specifically required by Delaware law. If any dividend payable on the Series KK Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the Series KK Preferred Stock
will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series KK Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the holders
of Series KK Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series KK Preferred Stock for at least four quarterly dividend periods following a
dividend arrearage described above, these voting rights will terminate. As long as the Series KK Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the voting power of the Series KK Preferred
Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series KK Preferred Stock as to dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to purchase any such shares of
capital stock. In addition, so long as any shares of the Series KK Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series KK Preferred Stock shall be necessary to amend, alter or
repeal any provision of the certificate of designations for the Series KK Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the Series KK Preferred Stock.
Distributions.
In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series KK Preferred
Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or
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set aside for the holders of our capital stock ranking junior to the Series KK Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of
$25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series KK Preferred Stock will not be subject to a sinking fund.
Redemption.
We may redeem the Series KK Preferred Stock, in whole or in part, at our option, at any time on or after June 25,
2024, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends. In addition, at any time
within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series KK Preferred Stock, we may redeem the Series KK Preferred Stock, in whole but not in part, at a redemption price equal to
$25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends.
Series LL Preferred Stock
Preferential Rights.
The Series LL Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series LL Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series LL Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series LL Preferred Stock without the consent of the holders of the Series LL Preferred Stock.
Dividends
. Holders of the Series LL Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, at an annual dividend rate per share of 5.000% on the liquidation preference of $25,000 per share. Dividends on the Series LL Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series LL Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other
capital stock ranking junior to the Series LL Preferred Stock unless full dividends on all outstanding shares of Series LL Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the
payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series LL Preferred Stock for any period unless full dividends on all outstanding shares of Series LL Preferred Stock for the immediately
preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series LL Preferred Stock and on any capital stock ranking equally with the Series LL Preferred Stock
but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series LL Preferred Stock and the holders of any capital stock ranking equally with the Series LL
Preferred Stock.
Voting Rights
. Holders of Series LL Preferred Stock do not have voting rights, except as described herein and as
specifically required by Delaware law. If any dividend payable on the Series LL Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the Series LL Preferred Stock
will be entitled to
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vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series LL Preferred Stock as to payment of dividends and upon which voting rights
equivalent to those granted to the holders of Series LL Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series LL Preferred Stock for at least four
quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series LL Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the
voting power of the Series LL Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series LL Preferred Stock as to dividends or the distribution of assets upon
liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to
purchase any such shares of capital stock. In addition, so long as any shares of the Series LL Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series LL Preferred Stock shall be
necessary to amend, alter or repeal any provision of the certificate of designations for the Series LL Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the Series LL Preferred
Stock.
Distributions
. In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series LL
Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the
Series LL Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of
liquidation. Shares of Series LL Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series LL
Preferred Stock, in whole or in part, at our option, at any time on or after September 17, 2024, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding
the redemption date, without accumulation of any undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series LL Preferred Stock, we may
redeem the Series LL Preferred Stock, in whole but not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation
of any undeclared dividends.
Series MM Preferred Stock
Preferential Rights
. The Series MM Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series MM Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series MM Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series MM Preferred Stock without the consent of the holders of the Series MM Preferred Stock.
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Dividends
. Holders of the Series MM Preferred Stock are entitled to receive cash
dividends, when, as, and if declared by our board of directors or a duly authorized committee thereof, (i) for each semi-annual dividend period from the issue date to, but excluding, January 28, 2025, at a rate of 4.300% per annum on the
liquidation preference of $25,000 per share, payable semiannually in arrears, and, (ii) for each quarterly dividend period from January 28, 2025 through the redemption date of the Series MM Preferred Stock, at a floating rate equal to
Adjusted Three-Month Term SOFR plus a spread of 2.664% per annum on the liquidation preference of $25,000 per share, payable quarterly in arrears. Dividends on the Series MM Preferred Stock are
non-cumulative.
As long as shares of Series MM Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series MM Preferred Stock unless full dividends on all
outstanding shares of Series MM Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking
equally with the Series MM Preferred Stock for any period unless full dividends on all outstanding shares of Series MM Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the
payment thereof set aside. If we declare dividends on the Series MM Preferred Stock and on any capital stock ranking equally with the Series MM Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend
payments on a pro rata basis among the holders of the shares of Series MM Preferred Stock and the holders of any capital stock ranking equally with the Series MM Preferred Stock.
Voting Rights
. Holders of Series MM Preferred Stock do not have voting rights, except as described herein and as specifically required
by Delaware law. If any dividend payable on the Series MM Preferred Stock is in arrears for three or more semi-annual dividend periods or six or more quarterly dividend periods, as applicable, whether or not for consecutive dividend periods, the
holders of the Series MM Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series MM Preferred Stock as to payment of dividends and upon which voting rights
equivalent to those granted to the holders of Series MM Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series MM Preferred Stock for at least two
semi-annual or four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series MM Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at
least 66 2/3% of the voting power of the Series MM Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series MM Preferred Stock as to dividends or the distribution of
assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing
the right to purchase any such shares of capital stock. In addition, so long as any shares of the Series MM Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series MM Preferred
Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series MM Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the
Series MM Preferred Stock.
Distributions
. In the event of our voluntary or involuntary liquidation, dissolution, or winding up,
holders of Series MM Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock
ranking junior to the Series MM Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared
dividends, to the date of liquidation. Shares of Series MM Preferred Stock will not be subject to a sinking fund.
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Redemption.
We may redeem the Series MM Preferred Stock, in whole or in part, at our
option, at any time on or after January 28, 2025, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the redemption date, without accumulation of any
undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series MM Preferred Stock, we may redeem the Series MM Preferred Stock, in whole but
not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation of any undeclared dividends.
Series NN Preferred Stock
Preferential Rights
. The Series NN Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series NN Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series NN Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series NN Preferred Stock without the consent of the holders of the Series NN Preferred Stock.
Dividends
. Holders of the Series NN Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, at an annual dividend rate per share of 4.375% on the liquidation preference of $25,000 per share. Dividends on the Series NN Preferred Stock are non-cumulative and are payable quarterly in arrears.
As long as shares of Series NN Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series NN Preferred Stock unless full dividends on all
outstanding shares of Series NN Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking
equally with the Series NN Preferred Stock for any period unless full dividends on all outstanding shares of Series NN Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the
payment thereof set aside. If we declare dividends on the Series NN Preferred Stock and on any capital stock ranking equally with the Series NN Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend
payments on a pro rata basis among the holders of the shares of Series NN Preferred Stock and the holders of any capital stock ranking equally with the Series NN Preferred Stock.
Voting Rights
. Holders of Series NN Preferred Stock do not have voting rights, except as described herein and as specifically required
by Delaware law. If any dividend payable on the Series NN Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the Series NN Preferred Stock will be entitled to
vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series NN Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the holders of Series NN
Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series NN Preferred Stock for at least four quarterly dividend periods following a dividend
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arrearage described above, these voting rights will terminate. As long as the Series NN Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of
the voting power of the Series NN Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series NN Preferred Stock as to dividends or the distribution of assets upon
liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to
purchase any such shares of capital stock. In addition, so long as any shares of the Series NN Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series NN Preferred Stock shall be
necessary to amend, alter or repeal any provision of the certificate of designations for the Series NN Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the Series NN Preferred
Stock.
Distributions
. In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series NN
Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the
Series NN Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of
liquidation. Shares of Series NN Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series NN
Preferred Stock, in whole or in part, at our option, at any time on or after November 3, 2025, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends, for the then-current dividend period to but excluding the
redemption date, without accumulation of any undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series NN Preferred Stock, we may
redeem the Series NN Preferred Stock, in whole but not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without accumulation
of any undeclared dividends.
Series PP Preferred Stock
Preferential Rights.
The Series PP Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series QQ Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series PP Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series PP Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series PP Preferred Stock without the consent of the holders of the Series PP Preferred Stock.
Dividends.
Holders of the Series PP Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, at an annual dividend rate per share of 4.125% on the liquidation preference of $25,000 per share. Dividends on the Series PP Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series PP Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other
capital stock ranking junior to the
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Series PP Preferred Stock unless full dividends on all outstanding shares of Series PP Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum
sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series PP Preferred Stock for any period unless full dividends on all outstanding shares of Series PP Preferred Stock for
the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series PP Preferred Stock and on any capital stock ranking equally with the Series PP
Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series PP Preferred Stock and the holders of any capital stock ranking equally
with the Series PP Preferred Stock.
Voting Rights.
Holders of the Series PP Preferred Stock do not have voting rights,
except as described herein and as specifically required by Delaware law. If any dividend payable on the Series PP Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders
of the Series PP Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series PP Preferred Stock as to payment of dividends and upon which voting rights
equivalent to those granted to the holders of Series PP Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series PP Preferred Stock for at least four
quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series PP Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the
voting power of the Series PP Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series PP Preferred Stock as to dividends or the distribution of assets upon
liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to
purchase any such shares of capital stock. In addition, so long as any shares of the Series PP Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series PP Preferred Stock shall be
necessary to amend, alter or repeal any provision of the certificate of designations for the Series PP Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the Series PP Preferred
Stock.
Distributions.
In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series PP
Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the
Series PP Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of
liquidation. Shares of Series PP Preferred Stock will not be subject to a sinking fund.
Redemption.
We may redeem the
Series PP Preferred Stock, in whole or in part, at our option any time on or after February 2, 2026, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to, but
excluding, the redemption date, without accumulation of any undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series PP Preferred
Stock, we may redeem the Series PP Preferred Stock, in whole but not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to but excluding the redemption date, without
accumulation of any undeclared dividends.
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Series QQ Preferred Stock
Preferential Rights
. The Series QQ Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series RR
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series QQ Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series QQ Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series QQ Preferred Stock without the consent of the holders of the Series QQ Preferred Stock.
Dividends
. Holders of the Series QQ Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, at an annual dividend rate per share of 4.250% on the liquidation preference of $25,000 per share. Dividends on the Series QQ Preferred Stock
are non-cumulative and
are payable quarterly in arrears. As long as shares of Series QQ Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock
or other capital stock ranking junior to the Series QQ Preferred Stock unless full dividends on all outstanding shares of Series QQ Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient
for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series QQ Preferred Stock for any period unless full dividends on all outstanding shares of Series QQ Preferred Stock for the
immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series QQ Preferred Stock and on any capital stock ranking equally with the Series QQ
Preferred Stock but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series QQ Preferred Stock and the holders of any capital stock ranking equally
with the Series QQ Preferred Stock.
Voting Rights
. Holders of the Series QQ Preferred Stock do not have voting rights, except as
described herein and as specifically required by Delaware law. If any dividend payable on the Series QQ Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the
Series QQ Preferred Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series QQ Preferred Stock as to payment of dividends and upon which voting rights equivalent to
those granted to the holders of Series QQ Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series QQ Preferred Stock for at least four quarterly
dividend periods following a dividend arrearage described above, these voting rights will terminate. As long as the Series QQ Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the voting power
of the Series QQ Preferred Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series QQ Preferred Stock as to dividends or the distribution of assets upon liquidation,
dissolution
or winding-up, or
to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to
purchase any such shares of capital stock. In addition, so long as any shares of the Series QQ Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series QQ Preferred
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Stock shall be necessary to amend, alter or repeal any provision of the certificate of designations for the Series QQ Preferred Stock or our certificate of incorporation so as to adversely affect
the powers, preferences or special rights of the Series QQ Preferred Stock.
Distributions
. In the event of our voluntary or
involuntary liquidation, dissolution, or winding up, holders of Series QQ Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made
to or set aside for the holders of our capital stock ranking junior to the Series QQ Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid
dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series QQ Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series QQ Preferred Stock, in whole or in part, at our option, any time on or after November 17,
2026, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to, but excluding, the redemption date, without accumulation of any undeclared dividends. In addition, at any time
within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series QQ Preferred Stock, we may redeem the Series QQ Preferred Stock, in whole but not in part, at a redemption price equal to
$25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to, but excluding, the redemption date, without accumulation of any undeclared dividends.
Series RR Preferred Stock
Preferential Rights
. The Series RR Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ
Preferred Stock, Series SS Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or
winding up. Series RR Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series RR Preferred Stock do not have any preemptive rights. We may issue stock
with preferences equal to the Series RR Preferred Stock without the consent of the holders of the Series RR Preferred Stock.
Dividends
. Holders of the Series RR Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of
directors or a duly authorized committee thereof, for each quarterly dividend period that occurs (1) during the period from, and including, the issue date, to, but excluding, January 27, 2027, at a fixed rate of 4.375% per annum, and
(2) from, and including, January 27, 2027, during each “reset period,” as defined in the certificate of designations for the Series RR Preferred Stock, at a rate per annum equal to the “Five-Year U.S. Treasury
Rate,” as described in the certificate of designations for the Series RR Preferred Stock, as of the most recent “reset dividend determination date,” as defined in the certificate of designations for the Series RR Preferred Stock,
plus a spread of 2.76% per annum. Dividends on the Series RR Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series RR Preferred Stock remain outstanding, we
cannot declare or pay cash dividends on any shares of our common stock or other capital stock ranking junior to the Series RR Preferred Stock unless full dividends on all outstanding shares of Series RR Preferred Stock for the immediately preceding
dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series RR Preferred Stock
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for any period unless full dividends on all outstanding shares of Series RR Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient
for the payment thereof set aside. If we declare dividends on the Series RR Preferred Stock and on any capital stock ranking equally with the Series RR Preferred Stock but cannot make full payment of those declared dividends, we will allocate the
dividend payments on a pro rata basis among the holders of the shares of Series RR Preferred Stock and the holders of any capital stock ranking equally with the Series RR Preferred Stock.
Voting Rights
. Holders of the Series RR Preferred Stock do not have voting rights, except as described herein and as specifically
required by Delaware law. If any dividend payable on the Series RR Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the Series RR Preferred Stock will be
entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series RR Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the holders of
Series RR Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series RR Preferred Stock for at least four quarterly dividend periods following a dividend
arrearage described above, these voting rights will terminate. As long as the Series RR Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the voting power of the Series RR Preferred Stock and
any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series RR Preferred Stock as to dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to purchase any such shares of
capital stock. In addition, so long as any shares of the Series RR Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series RR Preferred Stock shall be necessary to amend, alter or
repeal any provision of the certificate of designations for the Series RR Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the Series RR Preferred Stock.
Distributions
. In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series RR Preferred
Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series RR
Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation.
Shares of Series RR Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series RR Preferred
Stock, in whole or in part, at our option, on any dividend payment date after January 27, 2027, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to, but excluding,
the redemption date, without accumulation of any undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series RR Preferred Stock, we may
redeem the Series RR Preferred Stock, in whole but not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to, but excluding, the redemption date, without accumulation
of any undeclared dividends.
Series SS Preferred Stock
Preferential Rights
. The Series SS Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred
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Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock,
Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ Preferred Stock, Series RR Preferred Stock, Series TT Preferred Stock, Series 1 Preferred Stock, Series
2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or winding up. Series SS Preferred Stock is not convertible into or exchangeable for any shares of our
common stock or any other class of our capital stock. Holders of the Series SS Preferred Stock do not have any preemptive rights. We may issue stock with preferences equal to the Series SS Preferred Stock without the consent of the holders of the
Series SS Preferred Stock.
Dividends
. Holders of the Series SS Preferred Stock are entitled to receive cash dividends, when, as,
and if declared by our board of directors or a duly authorized committee thereof, at an annual dividend rate per share of 4.750% on the liquidation preference of $25,000 per share. Dividends on the Series SS Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series SS Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other capital
stock ranking junior to the Series SS Preferred Stock unless full dividends on all outstanding shares of Series SS Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the payment
thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series SS Preferred Stock for any period unless full dividends on all outstanding shares of Series SS Preferred Stock for the immediately
preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series SS Preferred Stock and on any capital stock ranking equally with the Series SS Preferred Stock
but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the holders of the shares of Series SS Preferred Stock and the holders of any capital stock ranking equally with the Series SS
Preferred Stock.
Voting Rights
. Holders of the Series SS Preferred Stock do not have voting rights, except as described herein and
as specifically required by Delaware law. If any dividend payable on the Series SS Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the Series SS Preferred
Stock will be entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series SS Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the
holders of Series SS Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series SS Preferred Stock for at least four quarterly dividend periods following
a dividend arrearage described above, these voting rights will terminate. As long as the Series SS Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the voting power of the Series SS Preferred
Stock and any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series SS Preferred Stock as to dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to purchase any such shares of
capital stock. In addition, so long as any shares of the Series SS Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series SS Preferred Stock shall be necessary to amend, alter or
repeal any provision of the certificate of designations for the Series SS Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the Series SS Preferred Stock.
Distributions
. In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series SS Preferred
Stock will be entitled to receive out of assets legally available for
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distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series SS Preferred Stock
as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series
SS Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series SS Preferred Stock, in whole or in
part, at our option, any time on or after February 17, 2027, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to, but excluding, the redemption date, without
accumulation of any undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series SS Preferred Stock, we may redeem the Series SS Preferred
Stock, in whole but not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to, but excluding, the redemption date, without accumulation of any undeclared dividends.
Series TT Preferred Stock
Preferential Rights
. The Series TT Preferred Stock ranks senior to our common stock and equally with the Series B Preferred Stock,
Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF
Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series QQ
Preferred Stock, Series RR, Series SS Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or winding up.
Series TT Preferred Stock is not convertible into or exchangeable for any shares of our common stock or any other class of our capital stock. Holders of the Series TT Preferred Stock do not have any preemptive rights. We may issue stock with
preferences equal to the Series TT Preferred Stock without the consent of the holders of the Series TT Preferred Stock.
Dividends
.
Holders of the Series TT Preferred Stock are entitled to receive cash dividends, when, as, and if declared by our board of directors or a duly authorized committee thereof, for each quarterly dividend period that occurs (1) during the period
from, and including, the issue date, to, but excluding, April 27, 2027, at a fixed rate of 6.125% per annum, and (2) from, and including, April 27, 2027, during each “reset period,” as defined in the certificate of
designations for the Series TT Preferred Stock, at a rate per annum equal to the “Five-Year U.S. Treasury Rate,” as described in the certificate of designations for the Series TT Preferred Stock, as of the most recent “reset
dividend determination date,” as defined in the certificate of designations for the Series TT Preferred Stock, plus a spread of 3.231% per annum. Dividends on the Series TT Preferred Stock are
non-cumulative
and are payable quarterly in arrears. As long as shares of Series TT Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of our common stock or other
capital stock ranking junior to the Series TT Preferred Stock unless full dividends on all outstanding shares of Series TT Preferred Stock for the immediately preceding dividend period have been paid in full or declared and a sum sufficient for the
payment thereof set aside. We cannot declare or pay cash dividends on capital stock ranking equally with the Series TT Preferred Stock for any period unless full dividends on all outstanding shares of Series TT Preferred Stock for the immediately
preceding dividend period have been paid in full or declared and a sum sufficient for the payment thereof set aside. If we declare dividends on the Series TT Preferred Stock and on any capital stock ranking equally with the Series TT Preferred Stock
but cannot make full payment of those declared dividends, we will allocate the dividend payments on a pro rata basis among the
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holders of the shares of Series TT Preferred Stock and the holders of any capital stock ranking equally with the Series TT Preferred Stock.
Voting Rights
. Holders of the Series TT Preferred Stock do not have voting rights, except as described herein and as specifically
required by Delaware law. If any dividend payable on the Series TT Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the Series TT Preferred Stock will be
entitled to vote as a class, together with the holders of all series of our preferred stock ranking equally with the Series TT Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the holders of
Series TT Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors. When we have paid full dividends on the Series TT Preferred Stock for at least four quarterly dividend periods following a dividend
arrearage described above, these voting rights will terminate. As long as the Series TT Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least 66 2/3% of the voting power of the Series TT Preferred Stock and
any voting parity stock shall be necessary to authorize, create or issue any capital stock ranking senior to the Series TT Preferred Stock as to dividends or the distribution of assets upon liquidation, dissolution or
winding-up,
or to reclassify any authorized capital stock into any such shares of such capital stock or issue any obligation or security convertible into or evidencing the right to purchase any such shares of
capital stock. In addition, so long as any shares of the Series TT Preferred Stock remain outstanding, the affirmative vote of the holders of at least 66 2/3% of the voting power of the Series TT Preferred Stock shall be necessary to amend, alter or
repeal any provision of the certificate of designations for the Series TT Preferred Stock or our certificate of incorporation so as to adversely affect the powers, preferences or special rights of the Series TT Preferred Stock.
Distributions
. In the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series TT Preferred
Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series TT
Preferred Stock as to distributions, a liquidating distribution in the amount of the liquidation preference of $25,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation.
Shares of Series TT Preferred Stock will not be subject to a sinking fund.
Redemption
. We may redeem the Series TT Preferred
Stock, in whole or in part, at our option, on any dividend payment date after April 27, 2027, at the redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to, but excluding, the
redemption date, without accumulation of any undeclared dividends. In addition, at any time within 90 days after a “capital treatment event,” as described in the certificate of designations for the Series TT Preferred Stock, we may
redeem the Series TT Preferred Stock, in whole but not in part, at a redemption price equal to $25,000 per share, plus any accrued and unpaid dividends for the then-current dividend period to, but excluding, the redemption date, without accumulation
of any undeclared dividends.
Series 1 Preferred Stock
Preferential Rights.
The Series 1 Preferred Stock ranks senior to common stock and equally with the Series B Preferred Stock, Series E
Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred
Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series 2 Preferred Stock,
Series 4 Preferred Stock, and
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Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or winding up. Shares of the Series 1 Preferred Stock are not convertible into or exchangeable for any
shares of common stock or any other class of our capital stock. Holders of the Series 1 Preferred Stock do not have any preemptive rights. We may issue stock with preferences equal to the Series 1 Preferred Stock without the consent of the holders
of the Series 1 Preferred Stock.
Dividends.
Holders of the Series 1 Preferred Stock are entitled to receive cash dividends, when,
as, and if declared by our board of directors or a duly authorized committee thereof, on the liquidation preference of $30,000 per share at an annual floating rate per share equal to the greater of (a) Adjusted Three-Month Term SOFR
(
provided, however
, that, for dividend periods commencing prior to the LIBOR Replacement Date, the dividend rate was determined by reference to Three-Month USD LIBOR), plus a spread of 0.75% and (b) 3.00%. Dividends on the Series 1 Preferred
Stock are
non-cumulative
and are payable quarterly, if declared. As long as shares of Series 1 Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of common stock or other
capital stock ranking junior to the Series 1 Preferred Stock unless full dividends on all outstanding shares of Series 1 Preferred Stock have been declared, paid or set aside for payment for the immediately preceding dividend period. We cannot
declare or pay cash dividends on capital stock ranking equally with the Series 1 Preferred Stock for any period unless for such dividend period full dividends on all outstanding shares of Series 1 Preferred Stock for the immediately preceding
dividend period have been declared, paid or set aside for payment. When dividends are not paid in full upon the shares of the Series 1 Preferred Stock and any capital stock ranking equally with the Series 1 Preferred Stock, all dividends declared
upon shares of the Series 1 Preferred Stock and all shares of capital stock ranking equally with the Series 1 Preferred Stock shall be declared pro rata so that the amount of dividends declared per share on the Series 1 Preferred Stock, and all such
other of our stock shall in all cases bear to each other the same ratio that accrued dividends per share on the shares of the Series 1 Preferred Stock and all such other stock bear to each other.
Voting Rights.
Holders of Series 1 Preferred Stock do not have voting rights, except as provided herein and as specifically required by
law. Holders of Series 1 Preferred Stock shall be entitled to vote on all matters submitted to a vote of the holders of common stock, voting together with the holders of common stock as one class, and each share of Series 1 Preferred Stock shall be
entitled to 150 votes. If any quarterly dividend payable on the Series 1 Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the Series 1 Preferred Stock will be
entitled to vote as a class, together with the holders of all series of preferred stock ranking equally with the Series 1 Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the holders of Series 1
Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors; each share of Series 1 Preferred Stock shall be entitled to three votes for the election of such Preferred Stock Directors. When we have paid
full dividends on the Series 1 Preferred Stock for at least four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate.
As long as the Series 1 Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least
two-thirds
of the shares of Series 1 Preferred Stock, outstanding at the time (voting as a class with all other series of preferred stock ranking equally with the Series 1 Preferred Stock), shall be necessary to
permit, effect or validate (i) the authorization, creation, or issuance, or any increase in the authorized or issued amount, of any class or series of stock ranking prior to the Series 1 Preferred Stock or (ii) the amendment, alteration,
or repeal, whether by merger, consolidation, or otherwise, of any of the provisions of the Certificate of Incorporation or of the resolutions set forth in a certificate of designations for the Series 1 Preferred Stock, which would adversely affect
any right, preference, or privilege or voting power of the Series 1 Preferred Stock, or of the holders thereof.
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Distributions.
In the event of our voluntary or involuntary liquidation, dissolution,
or winding up, holders of Series 1 Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment out of our assets may be made to or set aside for the holders of Bank
of America capital stock ranking junior to the Series 1 Preferred Stock, a liquidating distribution in the amount of the liquidation preference of $30,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared
dividends, to the date of liquidation. Shares of Series 1 Preferred Stock will not be subject to a sinking fund.
Redemption.
We
may redeem the Series 1 Preferred Stock, in whole or in part, at our option, at the redemption price equal to $30,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends.
Series 2 Preferred Stock
Preferential Rights.
The Series 2 Preferred Stock ranks senior to common stock and equally with the Series B Preferred Stock, Series E
Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred
Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series 1 Preferred Stock,
Series 4 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or winding up. Shares of the Series 2 Preferred Stock are not convertible into or exchangeable for any shares of common stock
or any other class of our capital stock. Holders of the Series 2 Preferred Stock do not have any preemptive rights. We may issue stock with preferences equal to the Series 2 Preferred Stock without the consent of the holders of the Series 2
Preferred Stock.
Dividends.
Holders of the Series 2 Preferred Stock are entitled to receive cash dividends, when, as, and if
declared by our board of directors or a duly authorized committee thereof, on the liquidation preference of $30,000 per share at an annual floating rate per share equal to the greater of (a) Adjusted Three-Month Term SOFR (
provided,
however
, that for dividend periods commencing prior to the LIBOR Replacement Date, the dividend rate was determined by reference to Three-Month USD LIBOR), plus a spread of 0.65% and (b) 3.00%. Dividends on the Series 2 Preferred Stock are
non-cumulative
and are payable quarterly in arrears, if declared. As long as shares of Series 2 Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of common stock or other
capital stock ranking junior to the Series 2 Preferred Stock unless full dividends on all outstanding shares of Series 2 Preferred Stock have been declared, paid or set aside for payment for the immediately preceding dividend period. We cannot
declare or pay cash dividends on capital stock ranking equally with the Series 2 Preferred Stock for any period unless for such dividend period full dividends on all outstanding shares of Series 2 Preferred Stock for the immediately preceding
dividend period have been declared, paid or set aside for payment. When dividends are not paid in full upon the shares of the Series 2 Preferred Stock and any capital stock ranking equally with the Series 2 Preferred Stock, all dividends declared
upon shares of the Series 2 Preferred Stock and all shares of capital stock ranking equally with the Series 2 Preferred Stock shall be declared pro rata so that the amount of dividends declared per share on the Series 2 Preferred Stock, and all such
other stock of ours shall in all cases bear to each other the same ratio that accrued dividends per share on the shares of the Series 2 Preferred Stock and all such other stock bear to each other.
Voting Rights.
Holders of Series 2 Preferred Stock do not have voting rights, except as provided herein and as specifically required by
law. Holders of Series 2 Preferred Stock shall be entitled to vote on all matters submitted to a vote of the holders of common stock, voting together with the holders of common stock as one class, and each share of Series 2 Preferred Stock shall be
entitled to
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150 votes. If any quarterly dividend payable on the Series 2 Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders
of the Series 2 Preferred Stock will be entitled to vote as a class, together with the holders of all series of preferred stock ranking equally with the Series 2 Preferred Stock as to payment of dividends and upon which voting rights equivalent to
those granted to the holders of Series 2 Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors; each share of Series 2 Preferred Stock shall be entitled to three votes for the election of such
Preferred Stock Directors. When we have paid full dividends on the Series 2 Preferred Stock for at least four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate.
As long as the Series 2 Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least
two-thirds
of the shares of Series 2 Preferred Stock, outstanding at the time (voting as a class with all other series of preferred stock ranking equally with the Series 2 Preferred Stock), shall be necessary to
permit, effect, or validate (i) the authorization, creation, or issuance, or any increase in the authorized or issued amount, of any class or series of stock ranking prior to the Series 2 Preferred Stock or (ii) the amendment, alteration,
or repeal, whether by merger, consolidation, or otherwise, of any of the provisions of the Certificate of Incorporation or of the resolutions set forth in a certificate of designations for the Series 2 Preferred Stock, which would adversely affect
any right, preference, or privilege or voting power of the Series 2 Preferred Stock, or of the holders thereof.
Distributions.
In
the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series 2 Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment
out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series 2 Preferred Stock, a liquidating distribution in the amount of the liquidation preference of $30,000 per share, plus any declared and
unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series 2 Preferred Stock will not be subject to a sinking fund.
Redemption.
We may redeem the Series 2 Preferred Stock, in whole or in part, at our option, at the redemption price equal to $30,000
per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends.
Series 4 Preferred Stock
Preferential Rights.
The Series 4 Preferred Stock ranks senior to common stock and equally with the Series B Preferred
Stock, Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series
FF Preferred Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series 1
Preferred Stock, Series 2 Preferred Stock, and Series 5 Preferred Stock as to dividends and distributions on Bank of America’s liquidation, dissolution, or winding up. Shares of the Series 4 Preferred Stock are not convertible into or
exchangeable for any shares of common stock or any other class of our capital stock. Holders of the Series 4 Preferred Stock do not have any preemptive rights. We may issue stock with preferences equal to the Series 4 Preferred Stock without the
consent of the holders of the Series 4 Preferred Stock.
Dividends.
Holders of the Series 4 Preferred Stock are entitled to receive
cash dividends, when, as, and if declared by our board of directors or a duly authorized committee thereof, on the liquidation preference of $30,000 per share at an annual floating rate per share equal to the greater
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of (a) Adjusted Three-Month Term SOFR (
provided, however
, that, for dividend periods commencing prior to the LIBOR Replacement Date, the dividend rate was determined by reference to
Three-Month USD LIBOR), plus a spread of 0.75% and (b) 4.00%. Dividends on the Series 4 Preferred Stock are
non-cumulative
and are payable quarterly in arrears, if declared. As long as shares of Series 4
Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of common stock or other capital stock ranking junior to the Series 4 Preferred Stock unless full dividends on all outstanding shares of Series 4 Preferred
Stock have been declared, paid or set aside for payment for the immediately preceding dividend period. We cannot declare or pay cash dividends on capital stock ranking equally with the Series 4 Preferred Stock for any period unless for such dividend
period full dividends on all outstanding shares of Series 4 Preferred Stock for the immediately preceding dividend period have been declared, paid or set aside for payment. When dividends are not paid in full upon the shares of the Series 4
Preferred Stock and any capital stock ranking equally with the Series 4 Preferred Stock, all dividends declared upon shares of the Series 4 Preferred Stock and all shares of capital stock ranking equally with the Series 4 Preferred Stock shall be
declared pro rata so that the amount of dividends declared per share on the Series 4 Preferred Stock, and all such other of our stock shall in all cases bear to each other the same ratio that accrued dividends per share on the shares of the Series 4
Preferred Stock and all such other stock bear to each other.
Voting Rights.
Holders of Series 4 Preferred Stock do not have voting
rights, except as provided herein and as specifically required by law. Holders of Series 4 Preferred Stock shall be entitled to vote on all matters submitted to a vote of the holders of common stock, voting together with the holders of common stock
as one class, and each share of Series 4 Preferred Stock shall be entitled to 150 votes. If any quarterly dividend payable on the Series 4 Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive
dividend periods, the holders of the Series 4 Preferred Stock will be entitled to vote as a class, together with the holders of all series of preferred stock ranking equally with the Series 4 Preferred Stock as to payment of dividends and upon which
voting rights equivalent to those granted to the holders of Series 4 Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors; each share of Series 4 Preferred Stock shall be entitled to three votes
for the election of such Preferred Stock Directors. When we have paid full dividends on the Series 4 Preferred Stock for at least four quarterly dividend periods following a dividend arrearage described above, these voting rights will terminate.
As long as the Series 4 Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least
two-thirds
of the shares of Series 4 Preferred Stock, outstanding at the time (voting as a class with all other series of preferred stock ranking equally with the Series 4 Preferred Stock), shall be necessary to
permit, effect, or validate (i) the authorization, creation, or issuance, or any increase in the authorized or issued amount, of any class or series of stock ranking prior to the Series 4 Preferred Stock or (ii) the amendment, alteration,
or repeal, whether by merger, consolidation, or otherwise, of any of the provisions of the Certificate of Incorporation or of the resolutions set forth in a certificate of designations for the Series 4 Preferred Stock, which would adversely affect
any right, preference, or privilege or voting power of the Series 4 Preferred Stock, or of the holders thereof.
Distributions.
In
the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series 4 Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment
out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series 4 Preferred Stock, a liquidating distribution in the amount of the liquidation preference of $30,000 per share, plus any declared and
unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series 4 Preferred Stock will not be subject to a sinking fund.
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Redemption.
We may redeem the Series 4 Preferred Stock, in whole or in part, at our
option, at the redemption price equal to $30,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends.
Series 5 Preferred Stock
Preferential Rights.
The Series 5 Preferred Stock ranks senior to common stock and equally with the Series B Preferred Stock, Series E
Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series AA Preferred Stock, Series DD Preferred Stock, Series FF Preferred
Stock, Series GG Preferred Stock, Series HH Preferred Stock, Series JJ Preferred Stock, Series KK Preferred Stock, Series LL Preferred Stock, Series MM Preferred Stock, Series NN Preferred Stock, Series PP Preferred Stock, Series 1 Preferred Stock,
Series 2 Preferred Stock, and Series 4 Preferred Stock as to dividends and distributions on our liquidation, dissolution, or winding up. Shares of the Series 5 Preferred Stock are not convertible into or exchangeable for any shares of common stock
or any other class of our capital stock. Holders of the Series 5 Preferred Stock do not have any preemptive rights. We may issue stock with preferences equal to the Series 5 Preferred Stock without the consent of the holders of the Series 5
Preferred Stock.
Dividends.
Holders of the Series 5 Preferred Stock are entitled to receive cash dividends, when, as, and if
declared by the our board of directors or a duly authorized committee thereof, on the liquidation preference of $30,000 per share at an annual floating rate per share equal to the greater of (a) Adjusted Three-Month Term SOFR (
provided,
however
, that, for dividend periods commencing prior to the LIBOR Replacement Date, the dividend rate was determined by reference to Three-Month USD LIBOR), plus a spread of 0.50% and (b) 4.00%. Dividends on the Series 5 Preferred Stock are
non-cumulative
and are payable quarterly in arrears, if declared. As long as shares of Series 5 Preferred Stock remain outstanding, we cannot declare or pay cash dividends on any shares of common stock or other
capital stock ranking junior to the Series 5 Preferred Stock unless full dividends on all outstanding shares of Series 5 Preferred Stock have been declared, paid or set aside for payment for the immediately preceding dividend period. We cannot
declare or pay cash dividends on capital stock ranking equally with the Series 5 Preferred Stock for any period unless for such dividend period full dividends on all outstanding shares of Series 5 Preferred Stock for the immediately preceding
dividend period have been declared, paid or set aside for payment. When dividends are not paid in full upon the shares of the Series 5 Preferred Stock and any capital stock ranking equally with the Series 5 Preferred Stock, all dividends declared
upon shares of the Series 5 Preferred Stock and all shares of capital stock ranking equally with the Series 5 Preferred Stock shall be declared pro rata so that the amount of dividends declared per share on the Series 5 Preferred Stock, and all such
other of our stock shall in all cases bear to each other the same ratio that accrued dividends per share on the shares of the Series 5 Preferred Stock and all such other stock bear to each other.
Voting Rights.
Holders of Series 5 Preferred Stock do not have voting rights, except as provided herein and as specifically required by
law. Holders of Series 5 Preferred Stock shall be entitled to vote on all matters submitted to a vote of the holders of common stock, voting together with the holders of common stock as one class, and each share of Series 5 Preferred Stock shall be
entitled to 150 votes. If any quarterly dividend payable on the Series 5 Preferred Stock is in arrears for six or more quarterly dividend periods, whether or not for consecutive dividend periods, the holders of the Series 5 Preferred Stock will be
entitled to vote as a class, together with the holders of all series of preferred stock ranking equally with the Series 5 Preferred Stock as to payment of dividends and upon which voting rights equivalent to those granted to the holders of Series 5
Preferred Stock have been conferred and are exercisable, for the election of two Preferred Stock Directors; each share of Series 5 Preferred Stock shall be entitled to three votes for the election of such Preferred
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Stock Directors. When we have paid full dividends on the Series 5 Preferred Stock for at least four quarterly dividend periods following a dividend arrearage described above, these voting rights
will terminate.
As long as the Series 5 Preferred Stock remains outstanding, the affirmative vote or consent of the holders of at least
two-thirds
of the shares of Series 5 Preferred Stock, outstanding at the time (voting as a class with all other series of preferred stock ranking equally with the Series 5 Preferred Stock), shall be necessary to
permit, effect, or validate (i) the authorization, creation, or issuance, or any increase in the authorized or issued amount, of any class or series of stock ranking prior to the Series 5 Preferred Stock or (ii) the amendment, alteration,
or repeal, whether by merger, consolidation, or otherwise, of any of the provisions of the Certificate of Incorporation or of the resolutions set forth in a certificate of designations for the Series 5 Preferred Stock, which would adversely affect
any right, preference, or privilege or voting power of the Series 5 Preferred Stock, or of the holders thereof.
Distributions.
In
the event of our voluntary or involuntary liquidation, dissolution, or winding up, holders of Series 5 Preferred Stock will be entitled to receive out of assets legally available for distribution to stockholders, before any distribution or payment
out of our assets may be made to or set aside for the holders of our capital stock ranking junior to the Series 5 Preferred Stock, a liquidating distribution in the amount of the liquidation preference of $30,000 per share, plus any declared and
unpaid dividends, without accumulation of any undeclared dividends, to the date of liquidation. Shares of Series 5 Preferred Stock will not be subject to a sinking fund.
Redemption.
We may redeem the Series 5 Preferred Stock, in whole or in part, at our option, at the redemption price equal to $30,000
per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends.
Additional Classes or
Series of Stock
We will have the right to create and issue additional classes or series of stock ranking equally with or junior to
our preferred stock as to dividends and distribution of assets upon any liquidation, dissolution, or winding up without the consent of the holders of such preferred stock, or the holders of the related depositary shares.
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DESCRIPTION OF DEPOSITARY SHARES
General
We
may offer depositary shares, each of which will represent a fractional interest in a share or multiple shares of our preferred stock, rather than whole shares of our preferred stock. We will deposit shares of preferred stock of each series
represented by depositary shares under a deposit agreement between us and a U.S. bank or trust company that we will select (the “depository”).
This section describes some of the general terms and provisions applicable to all depositary shares. We will describe the specific terms of a
series of depositary shares and the applicable deposit agreement in the applicable supplement. A form of deposit agreement, including a form of depositary receipt, was filed as an exhibit to the registration statement of which this prospectus forms
a part. See “Where You Can Find More Information” below for information on how to obtain copies of any deposit agreements and depositary receipts that we may file with the SEC in connection with depositary shares that we may offer.
Form of the Depositary Shares
The depositary shares will be evidenced by depositary receipts issued under a deposit agreement. Subject to the terms of the applicable
deposit agreement, each holder of a depositary share will be entitled, in proportion to the fractional interest of a share of preferred stock represented by the applicable depositary share, to all the rights and preferences of the preferred stock
being represented, including dividend, voting, redemption, conversion, and liquidation rights, all as will be set forth in the applicable supplement relating to the depositary shares being offered. Unless we specify otherwise in the applicable
supplement, we will issue depositary shares in book-entry only form. Depositary shares in book-entry only form will be represented by a global depositary receipt deposited with and held in the name of a clearing system or its nominee. Accordingly,
the clearing system will be the registered holder of all the depositary shares represented by the global depositary receipt. Those who own beneficial interests in a global depositary receipt will do so through participants in that clearing
system’s book-entry system, and the rights of these indirect owners will be governed solely by the applicable procedures of the clearing system and its participants. We describe the procedures applicable to book-entry only securities below
under the heading “Registration and Settlement.” A global depositary receipt shall be exchangeable for definitive depositary receipts only in certain circumstances.
Withdrawal of Preferred Stock
Unless the depositary shares have been called for redemption, a holder of depositary shares may surrender his or her depositary receipts at
the principal office of the depository, pay any charges, and comply with any other terms as provided in the applicable deposit agreement for the number of shares of preferred stock underlying the depositary shares. A holder of depositary shares who
withdraws shares of preferred stock will be entitled to receive whole shares of preferred stock on the basis set forth in the applicable supplement relating to the depositary shares being offered.
However, unless we specify otherwise in the applicable supplement, holders of whole shares of preferred stock will not be entitled to deposit
those shares under the applicable deposit agreement or to receive depositary receipts for those shares after the withdrawal. If the depositary shares surrendered by the holder in connection with the withdrawal exceed the number of depositary shares
that represent the number of whole shares of preferred stock to be withdrawn, the depository will deliver to the holder at the same time a new depositary receipt evidencing the excess number of depositary shares.
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Dividends and Other Distributions
The depository will distribute all cash dividends or other cash distributions received in respect of the preferred stock to the record holders
of depositary shares relating to that preferred stock in proportion to the number of depositary shares owned by those holders. However, the depository will distribute only the amount that can be distributed without attributing to any holder of
depositary shares a fraction of one cent. Any balance that is not distributed will be added to and treated as part of the next sum received by the depository for distribution to record holders.
If there is a distribution other than in cash, the depository will distribute property it receives to the record holders of depositary shares
who are entitled to that property. However, if the depository determines that it is not feasible to make this distribution of property, the depository, with our approval, may sell that property and distribute the net proceeds to the holders of the
depositary shares.
Redemption of Depositary Shares
If a series of preferred stock represented by depositary shares is redeemed, the depositary shares will be redeemed from the proceeds received
by the depository from the redemption, in whole or in part, of that series of preferred stock. Unless we specify otherwise in the applicable supplement, the depository will provide notice of redemption at least 30 and not more than 60 calendar days
before the date fixed for redemption to the record holders of the depositary shares to be redeemed. The redemption price per depositary share will be equal to the applicable fraction of the redemption price per share payable on that series of the
preferred stock.
Whenever we redeem preferred stock held by the depository, the depository will redeem as of the same redemption date the
number of depositary shares representing the shares of preferred stock so redeemed. If less than all of the depositary shares are redeemed, the depositary shares redeemed will be selected by lot or pro rata.
After the date fixed for redemption, the depositary shares called for redemption will no longer be deemed to be outstanding. At that time, all
rights of the holder of the depositary shares will cease, except the right to receive any money or other property they become entitled to receive upon surrender to the depository of the depositary receipts.
Voting the Deposited Preferred Stock
Any voting rights of holders of the depositary shares are directly dependent on the voting rights of the underlying preferred stock, which
customarily have limited voting rights. Upon receipt of notice of any meeting at which the holders of the preferred stock held by the depository are entitled to vote, the depository will mail the information contained in the notice of meeting to the
record holders of the depositary shares relating to the preferred stock. Each record holder of depositary shares on the record date, which will be the same date as the record date for the underlying preferred stock, will be entitled to instruct the
depository as to the exercise of the voting rights pertaining to the amount of preferred stock underlying the holder’s depositary shares. The depository will endeavor, insofar as practicable, to vote the amount of preferred stock underlying
the depositary shares in accordance with these instructions. We will agree to take all action which may be deemed necessary by the depository to enable the depository to do so. The depository will not vote any shares of preferred stock except to the
extent it receives specific instructions from the holders of depositary shares representing that number of shares of preferred stock.
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Amendment and Termination of the Deposit Agreement
The form of depositary receipt evidencing the depositary shares and any provision of the applicable deposit agreement may be amended by
agreement between us and the depository. However, any amendment which materially and adversely alters the rights of the existing holders of depositary shares will not be effective unless the amendment has been approved by the record holders of at
least a majority of the depositary shares then outstanding. Either we or the depository may terminate a deposit agreement if all of the outstanding depositary shares have been redeemed or if there has been a final distribution in respect of our
preferred stock in connection with our liquidation, dissolution, or winding up.
Charges of Depository
We will pay all transfer and other taxes, assessments, and governmental charges arising solely from the existence of the depository
arrangements. We will pay the fees of the depository in connection with the initial deposit of the preferred stock and any redemption of the preferred stock. Holders of depositary receipts will pay transfer and other taxes, assessments, and
governmental charges and any other charges as are expressly provided in the applicable deposit agreement to be for their accounts. The depository may refuse to effect any transfer of a depositary receipt or any withdrawals of preferred stock
evidenced by a depositary receipt until all taxes, assessments, and governmental charges with respect to the depositary receipt or preferred stock are paid by their holders.
Miscellaneous
The depository will forward to the holders of depositary shares all of our reports and communications which are delivered to the depository
and which we are required to furnish to the holders of our preferred stock.
Neither we nor the depository will be liable if we are
prevented or delayed by law or any circumstance beyond our control in performing our obligations under the applicable deposit agreement. All of our obligations as well as the depository’s obligations under the applicable deposit agreement are
limited to performance of our respective duties set forth in the applicable deposit agreement without gross negligence, willful misconduct or bad faith, and neither of us will be obligated to prosecute or defend any legal proceeding relating to any
depositary shares or preferred stock unless provided with satisfactory indemnity. We, and the depository, may rely upon written advice of counsel or accountants, or information provided by persons presenting preferred stock for deposit, holders of
depositary shares, or other persons believed to be competent and on documents believed to be genuine.
Resignation and
Removal of Depository
The depository may resign at any time by delivering to us notice of its election to do so, and we may remove
the depository at any time, in each case without your consent and without notifying you of such event. Any resignation or removal will take effect only upon the appointment of a successor depository and the successor depository’s acceptance of
the appointment. Any successor depository must be a U.S. bank or trust company.
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DESCRIPTION OF COMMON STOCK
This section describes the general terms and provisions of the shares of our common stock
.
We also have filed our Restated Certificate
of Incorporation and our bylaws as exhibits to the registration statement of which this prospectus is a part. You should read our Restated Certificate of Incorporation and our bylaws for additional information about our common stock.
General
As of
the date of this prospectus, under our Restated Certificate of Incorporation, we are authorized to issue twelve billion eight hundred million (12,800,000,000) shares of common stock, par value $.01 per share, of which approximately 7.9 billion
shares were outstanding on December 31, 2023. Our common stock trades on the New York Stock Exchange under the symbol “BAC.” As of December 31, 2023, approximately 497 million shares were reserved for issuance in
connection with our various employee and director benefit plans, the conversion of outstanding securities convertible into shares of our common stock, and for other purposes. After taking into account the reserved shares, there were approximately
4.4 billion authorized shares of our common stock available for issuance as of December 31, 2023.
Shares of our common stock
will be uncertificated unless our board of directors by resolution determines otherwise. Shares represented by an existing certificate will remain certificated until such certificate is surrendered to us.
Voting and Other Rights
Holders of our common stock are entitled to one vote per share. There are no cumulative voting rights. In general, a majority of votes cast on
a matter is sufficient to take action upon routine matters, including the election of directors in an uncontested election. However, (1) amendments to our Restated Certificate of Incorporation generally must be approved by the affirmative vote
of the holders of a majority of the voting power of the outstanding stock, and (2) a merger, dissolution, or the sale of all or substantially all of our assets generally must be approved by the affirmative vote of the holders of a majority of
the voting power of the outstanding stock.
In the event of our liquidation, holders of our common stock will be entitled to receive pro
rata any assets legally available for distribution to stockholders, subject to any prior rights of any preferred stock then outstanding.
Our common stock does not have any preemptive rights, redemption privileges, sinking fund privileges, or conversion rights. All the
outstanding shares of our common stock are, and upon proper conversion of any convertible securities, all of the shares of our common stock into which those securities are converted will be, validly issued, fully paid, and nonassessable.
Computershare Trust Company, N.A. is the transfer agent and registrar for our common stock.
Dividends
Subject to the preferential rights of any holders of any outstanding series of preferred stock, the holders of our common stock are entitled
to receive dividends or distributions, whether payable in cash or otherwise, as our board of directors may declare out of funds legally available for payments. Stock dividends, if any are declared, may be paid from our authorized but unissued shares
of common stock.
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Certain Anti-Takeover Matters
Certain provisions of Delaware law and of our Restated Certificate of Incorporation and bylaws could make it more difficult for a third party
to acquire control of us or have the effect of discouraging a third party from attempting to acquire control of us. For example, we are subject to Section 203 of the Delaware General Corporation Law, which would make it more difficult for
another party to acquire us without the approval of our board of directors. Certain provisions of our Restated Certificate of Incorporation and bylaws may make it less likely that our management would be changed or that someone would acquire voting
control of our company without our board’s consent. These provisions could make it more difficult for a third party to acquire us even if an acquisition might be in the best interest of our stockholders.
Preferred Stock
Our board of directors can, at any time, under our Restated Certificate of Incorporation and without stockholder approval, issue one or more
new series of preferred stock. In some cases, the issuance of preferred stock without stockholder approval could discourage or make more difficult attempts to take control of our company through a merger, tender offer, proxy contest or otherwise.
Preferred stock with special voting rights or other features issued to persons favoring our management could stop a takeover by preventing the person trying to take control of our company from acquiring enough voting shares necessary to take
control.
Advance Notice Requirements
Our bylaws establish advance notice procedures with regard to stockholder proposals relating to nominations for the election of directors or
other business to be brought before meetings of our stockholders. These procedures provide that notice of such stockholder proposals must be timely given to our corporate secretary prior to the meeting at which the action is to be taken. The notice
must contain certain information specified in the bylaws and must otherwise comply with the bylaws.
Vacancies
Under our bylaws, a majority vote of our board of directors may increase or decrease the number of directors. Any director may be removed at
any time with or without cause by the affirmative vote of the holders of a majority of the voting power of the outstanding shares then entitled to vote at an election of directors. Any vacancy on our board of directors or newly created directorship
will be filled by a majority vote of the remaining directors then in office, and those newly elected directors will serve for a term expiring at the next annual meeting of stockholders, and until such directors’ successor has been elected and
qualified.
Amendment of Bylaws
Our bylaws may be adopted, amended or repealed by a majority of our board of directors, subject to certain limitations in our bylaws. Our
stockholders also have the power to adopt, amend or repeal our bylaws.
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REGISTRATION AND SETTLEMENT
Unless we specify otherwise in the applicable supplement, we will issue the securities in registered, and not bearer, form. This means that
our obligation runs to the holder of the security named on the face of the security. Each debt security, warrant, purchase contract, unit and depositary share issued in registered form will be represented either by a certificate issued in definitive
form to a particular investor or by one or more global securities representing the entire series of securities. Shares of preferred stock and common stock will be uncertificated unless we specify otherwise.
We refer to those persons who have securities registered in their own names, on the books that we or the trustee, warrant agent, registrar or
other agent maintain for this purpose, as the “holders” of those securities. These persons are the legal holders of the securities. We refer to those who, indirectly through others, own beneficial interests in securities that are not
registered in their own names as indirect owners or beneficial owners of those securities. As we discuss below, indirect owners are not legal holders, and investors in securities issued in global, or book-entry only, form or in street name will be
indirect owners.
Book-Entry Only Issuance
Unless we specify otherwise in the applicable supplement (and other than uncertificated preferred stock and common stock), we will issue each
security in global, or book-entry, form. This means that we will not issue certificated securities in definitive form to investors. Instead, we will issue global securities in registered form representing the entire series of securities. Each global
security will be registered in the name of a financial institution or clearing system that holds the global security as depository on behalf of other financial institutions that participate in that depository’s book-entry system. These
participating institutions, in turn, hold beneficial interests in the global securities on behalf of themselves or their customers.
Because securities issued in global form are registered in the name of the depository, we will recognize only the depository as the holder of
the securities. This means that we will make all payments on the securities, including deliveries of any property other than cash, to the depository. The depository passes along the payments it receives from us to its participants, which in turn
pass the payments along to their customers who are the beneficial owners. The depository and its participants are not obligated to pass these payments along under the terms of the securities. Instead, they do so under agreements they have made with
one another or with their customers.
As a result, investors will not own securities issued in book-entry only form directly. Instead,
they will own beneficial interests in a global security, through a bank, broker, or other financial institution that participates in the depository’s book-entry system or holds an interest through a participant in the depository’s
book-entry system. As long as the securities are issued in global form, investors will be indirect owners, and not holders, of the securities. The depository will not have knowledge of the actual beneficial owners of the securities.
Definitive Securities
In the future, we may cancel a global security or we may issue securities initially in
non-global,
or
definitive, form. We do not expect to exchange global securities for certificated securities in definitive form registered in the names of the beneficial owners of the global securities representing the securities except in the limited circumstances
described in the relevant securities or in the indenture, agreement or other instrument governing the relevant securities.
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Street Name Owners
If we issue certificated securities in definitive form registered in the names of the beneficial owners, investors may choose to hold their
securities in their own names or in street name. Securities held by an investor in street name would be registered in the name of a bank, broker, or other financial institution that the investor chooses, and the investor would hold only a beneficial
interest in those securities through an account that he or she maintains at that institution.
For securities held in street name, we will
recognize only the intermediary banks, brokers, and other financial institutions in whose names the securities are registered as the holders of those securities, and we will make all payments on those securities, including deliveries of any property
other than cash, to them. These institutions pass along the payments they receive to their customers who are the beneficial owners, but only because they agree to do so in their customer agreements or because they are legally required to do so.
Investors who hold securities in street name will be indirect owners, not holders, of those securities.
Legal Holders
Our obligations, as well as the obligations of the trustee under any indenture and the obligations, if any, of any warrant agents,
unit agents, depository for preferred stock represented by depositary shares, and any other third parties employed by us, the trustee, or any of those agents, run only to the holders of the securities. We do not have obligations to investors who
hold beneficial interests in global securities, who hold the securities in street name, or who hold the securities by any other indirect means. This will be the case whether an investor chooses to be an indirect owner of a security or has no choice
because we are issuing the securities only in global form. For example, once we make a payment or give a notice to the holder, we have no further responsibility for that payment or notice even if that holder is required, under agreements with
depository participants or customers or by law, to pass it along to the indirect owners, but does not do so. Similarly, if we want to obtain the approval of the holders for any purpose, such as to amend the indenture for a series of debt securities
or the warrant agreement for a series of warrants or the unit agreement for a series of units or to relieve us of the consequences of a default or of our obligation to comply with a particular provision of an indenture, we would seek the approval
only from the holders, and not the indirect owners, of the relevant securities. Whether and how the holders contact the indirect owners is up to the holders.
When we refer to “you” in this prospectus, we mean those who invest in the securities being offered by this prospectus, whether
they are the holders or only indirect owners of those securities. When we refer to “your securities” in this prospectus, we mean the securities in which you will hold a direct or indirect interest.
Special Considerations for Indirect Owners
If you hold securities through a bank, broker, or other financial institution, either in book-entry only form or in street name, you should
check with your own institution to find out:
•
how it handles payments on your securities and notices;
•
whether it imposes fees or charges;
•
whether and how you can instruct it to exercise any rights to purchase or sell warrant property under a warrant
or purchase contract property under a purchase contract or to exchange or convert a security for or into other property;
•
how it would handle a request for the holders’ consent, if required;
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•
whether and how you can instruct it to send you the securities registered in your own name so you can be a
holder, if that is permitted in the future;
•
how it would exercise rights under the securities if there were a default or other event triggering the need for
holders to act to protect their interests; and
•
if the securities are in book-entry only form, how the depository’s rules and procedures will affect these
matters.
Depositories for Global Securities
Each security issued in book-entry only form will be represented by a global security that we deposit with and register in the name of one or
more financial institutions or clearing systems, which we will select, or their nominees. A financial institution or clearing system that we select for this purpose is called the “depository” for that security. A security usually will
have only one depository, but it may have more.
Each series of securities will have one or more of the following as the depositories:
•
The Depository Trust Company, New York, New York, which is known as “DTC”;
•
a financial institution holding the securities on behalf of Euroclear Bank SA/NV, which is known as
“Euroclear”;
•
a financial institution holding the securities on behalf of Clearstream Banking S.A., Luxembourg, which is known
as “Clearstream, Luxembourg”;
•
CDS Clearing and Depository Services Inc., Toronto, Ontario, Canada, which is known as “CDS”; and
•
any other clearing system or financial institution that we identify in the applicable supplement.
The depositories named above also may be participants in one another’s clearing systems. For example, if DTC is
the depository for a global security, investors may hold beneficial interests in that security through Euroclear or Clearstream, Luxembourg as DTC participants.
We will name the depository or depositories for your securities in the applicable supplement. If no depository is named, the depository will
be DTC.
The Depository Trust Company
The following is based on information made publicly available by DTC:
Unless we specify otherwise in the applicable supplement, DTC will act as securities depository for the securities. The securities will be
issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or any other name as may be requested by an authorized representative of DTC. One fully-registered security certificate will be
issued for each issue of the securities, each in the aggregate principal amount of the issue, and will be deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500 million, one certificate will be issued with
respect to each $500 million of principal amount, and an additional certificate will be issued with respect to any remaining principal amount of the issue. We may also issue one or more global securities that represent multiple series of debt
securities.
DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking
Law, a “banking organization” within the meaning of the New York
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Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency”
registered under Section 17A of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). DTC holds and provides asset servicing for over 3.5 million issues of U.S. and
non-U.S. equity
issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s direct participants deposit with DTC. DTC also facilitates the
post-trade settlement among direct participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between direct participants’ accounts. This eliminates the
need for physical movement of securities certificates. Direct participants include both U.S. and
non-U.S.
securities brokers and dealers, banks, trust companies, clearing corporations, and certain other
organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of
which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and
non-U.S. securities
brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a direct participant, either directly or indirectly (“indirect participants”). The DTC rules applicable
to its participants are on file with the SEC. More information about DTC can be found at www.dtcc.com. Information on that website is not included or incorporated by reference herein.
Purchases of the securities under the DTC system must be made by or through direct participants, which will receive a credit for the
securities on DTC’s records. The ownership interest of each actual purchaser of each security (“beneficial owner”) is in turn to be recorded on the direct and indirect participants’ records. Beneficial owners will not receive
written confirmation from DTC of their purchase. Beneficial owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the direct or indirect
participant through which the beneficial owner entered into the transaction. Transfers of ownership interests in the securities are to be accomplished by entries made on the books of direct and indirect participants acting on behalf of beneficial
owners. Beneficial owners will not receive certificates representing their ownership interests in the securities, except in the event that use of the book-entry system for the securities is discontinued.
To facilitate subsequent transfers, all securities deposited by direct participants with DTC are registered in the name of DTC’s
partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not
effect any change in beneficial ownership. DTC has no knowledge of the actual beneficial owners of the securities; DTC’s records reflect only the identity of the direct participants to whose accounts such securities are credited, which may or
may not be the beneficial owners. The direct and indirect participants will remain responsible for keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to direct participants, by direct participants to indirect participants, and by direct
and indirect participants to beneficial owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial owners of securities may wish to take certain steps to
augment the transmission to them of notices of significant events with respect to the securities, such as redemptions, tenders, defaults, and proposed amendments to the security documents. For example, beneficial owners of securities may wish to
ascertain that the nominee holding the securities for its benefit has agreed to obtain and transmit notices to beneficial owners. In the alternative, beneficial owners may wish to provide their names and addresses to the registrar and request that
copies of notices be provided directly to them.
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Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with
respect to securities unless authorized by a direct participant in accordance with DTC’s Money Market Instrument (“MMI”) procedures. Under its usual procedures, DTC mails an omnibus proxy to us as soon as possible after the record
date. The omnibus proxy assigns Cede & Co.’s consenting or voting rights to those direct participants to whose accounts the securities are credited on the record date (identified in a listing attached to the omnibus proxy).
Dividend payments or any payments of principal, any premium, interest, or other amounts on the securities will be made to Cede & Co.,
or any other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit direct participants’ accounts upon DTC’s receipt of funds and corresponding detail information from us, on the applicable
payment date in accordance with their respective holdings shown on DTC’s records. Payments by participants to beneficial owners will be governed by standing instructions and customary practices, as is the case with securities held for the
accounts of customers in bearer form or registered in “street name,” and will be the responsibility of these participants and not of DTC or its nominee, us, the trustee, or any other agent or party, subject to any statutory or regulatory
requirements that may be in effect from time to time. Payment of dividends or principal and any premium or interest to Cede & Co. (or any other nominee as may be requested by an authorized representative of DTC) is our responsibility.
Disbursement of the payments to direct participants is the responsibility of DTC, and disbursement of the payments to the beneficial owners is the responsibility of the direct or indirect participants.
We will send any redemption notices to DTC. If less than all of the securities of a series are being redeemed, DTC’s practice is to
determine by lot the amount of the interest of each direct participant in the issue to be redeemed.
A beneficial owner shall give notice
to elect to have its securities repurchased through the participant through which it holds its beneficial interest in the security to the applicable trustee or tender agent. The beneficial owner shall effect delivery of its securities by causing the
direct participant to transfer its interest in the securities on DTC’s records. The requirement for physical delivery of securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership
rights in the securities are transferred by the direct participant on DTC’s records and followed by a book-entry credit of tendered securities to the applicable trustee or agent’s DTC account.
DTC may discontinue providing its services as depository for the securities at any time by giving us reasonable notice. If this occurs, and if
a successor securities depository is not obtained, we will print and deliver definitive securities.
We may decide to discontinue use of
the system of book-entry only transfers through DTC (or a successor securities depository). In that event, we will print and deliver definitive securities to DTC.
The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that we believe to be
reliable, but we take no responsibility for its accuracy.
Euroclear and Clearstream, Luxembourg
Euroclear and Clearstream, Luxembourg each hold securities for their customers and facilitate the clearance and settlement of securities
transactions by electronic book-entry transfer between their respective account holders (each such account holder, a “participant” and collectively, the “participants”). Euroclear and Clearstream, Luxembourg provide various
services including safekeeping, administration, clearance and settlement of internationally traded securities and
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securities lending and borrowing. Euroclear and Clearstream, Luxembourg also deal with domestic securities markets in several countries through established depository and custodial relationships.
Euroclear and Clearstream, Luxembourg have established an electronic bridge between their two systems across which their respective participants may settle trades with each other. Euroclear is incorporated under the laws of Belgium and Clearstream,
Luxembourg is incorporated under the laws of Luxembourg.
Euroclear and Clearstream, Luxembourg customers are world-wide financial
institutions, including underwriters, securities brokers and dealers, banks, trust companies, and clearing corporations. Indirect access to Euroclear and Clearstream, Luxembourg is available to other institutions that clear through or maintain a
custodial relationship with a participant of either system.
The address of Euroclear is Euroclear Bank SA/NV, 1 Boulevard du Roi Albert
II,
B-1210
Brussels and the address of Clearstream, Luxembourg is Clearstream Banking, 42 Avenue JF Kennedy,
L-1855,
Luxembourg.
Euroclear and Clearstream, Luxembourg may be depositories for a global security sold or traded outside the United States. In addition, if DTC
is the depository for a global security, Euroclear and Clearstream, Luxembourg may hold interests in the global security as participants in DTC. As long as any global security is held by Euroclear or Clearstream, Luxembourg as depository, you may
hold an interest in the global security only through an organization that participates, directly or indirectly, in Euroclear or Clearstream, Luxembourg. If Euroclear or Clearstream, Luxembourg is the depository for a global security and there is no
depository in the United States, you will not be able to hold interests in that global security through any securities clearing system in the United States.
Payments, deliveries, transfers, exchanges, notices, and other matters relating to the securities made through Euroclear or Clearstream,
Luxembourg must comply with the rules and procedures of those clearing systems. Those clearing systems could change their rules and procedures at any time. We have no control over those clearing systems or their participants, and we take no
responsibility for their activities. Transactions between participants in Euroclear or Clearstream, Luxembourg, on one hand, and participants in DTC, on the other hand, when DTC is the depository, also would be subject to DTC’s rules and
procedures.
Investors will be able to make and receive through Euroclear and Clearstream, Luxembourg payments, deliveries, transfers,
exchanges, notices, and other transactions involving any securities held through those clearing systems only on days when those clearing systems are open for business. Those clearing systems may not be open for business on days when banks, brokers,
and other institutions are open for business in the United States. In addition, because of time-zone differences, U.S. investors who hold their interests in the securities through these clearing systems and wish to transfer their interests, or to
receive or make a payment or delivery or exercise any other right with respect to their interests, on a particular day may find that the transaction will not be effected until the next business day in Brussels or Luxembourg, as applicable. Thus,
investors who wish to exercise rights that expire on a particular day may need to act before the expiration date. In addition, investors who hold their interests through both DTC and Euroclear or Clearstream, Luxembourg may need to make special
arrangements to finance any purchases or sales of their interests between the United States and European clearing systems, and those transactions may settle later than would be the case for transactions within one clearing system.
The information in this section concerning Euroclear and Clearstream, Luxembourg has been obtained from sources that we believe to be
reliable, but we take no responsibility for its accuracy.
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CDS Clearing and Depository Services Inc.
Debt securities that are denominated in Canadian dollars (“Canadian notes”) may be issued as one or more registered notes in
global form (i.e., global notes), initially registered in the name of CDS & CO., as nominee for CDS, and deposited with CDS. Beneficial interests in the global notes will be represented through book-entry accounts of financial institutions
acting on behalf of beneficial owners as direct and indirect participants in CDS. Investors may elect to hold interests in the global notes through any of CDS, Euroclear or Clearstream, Luxembourg if they are participants of those systems, or
indirectly through organizations which are participants in those systems. Euroclear and Clearstream, Luxembourg will hold interests on behalf of their participants through customers’ securities accounts in their respective names on the books
of their respective Canadian subcustodians (“Canadian Subcustodians”), which in turn will hold those interests in customers’ securities accounts in the names of the Canadian Subcustodians on the books of CDS.
The global notes representing Canadian notes will be registered in the name of CDS & CO., as nominee of CDS, for the benefit of
owners of beneficial interests in the global notes, including participants of Euroclear and Clearstream, Luxembourg. Principal and interest payments on the global notes registered in the name of CDS & CO., or any other nominee appointed by
CDS, will be made on our behalf to CDS & CO., or any other nominee appointed by CDS, and CDS will distribute the payments received to the applicable clearing system.
For as long as the Canadian notes are maintained in book-entry only form at CDS, we and any paying agent will treat CDS & CO., or any
other nominee appointed by CDS, as the sole holder of such Canadian notes for all purposes. Canadian notes which are represented by the global notes will be transferable only in accordance with the rules and procedures of CDS.
The registered holder of the applicable global notes will be the only person entitled to receive payments in respect of the Canadian notes
represented by those global notes, and we will be discharged by payment to, or to the order of, the registered holder of those global notes for each amount so paid. Each of the persons shown in the records of CDS as the beneficial holder of a
particular nominal amount of notes represented by the global notes must look solely to CDS for its share of each payment that we make to, or to the order of, the registered holder of the global notes. No person other than the registered holder of
the global notes will have any claim against us in respect of any payments due on the global notes.
CDS is Canada’s national
securities clearing and depositary services organization. CDS participants include banks (including the Canadian Subcustodians), investment dealers, and trust companies and may include certain of the underwriters for a particular offering of
Canadian notes. Functioning as a service utility for the Canadian financial community, CDS provides a variety of computer automated services for financial institutions and investment dealers active in domestic and international capital markets.
Indirect access to CDS is available to other organizations that clear through, or maintain a custodial relationship with, a CDS participant. Transfers of ownership and other interests, including cash distributions, in notes clearing and settling
through CDS may only be processed through CDS participants and will be completed in accordance with existing CDS rules and procedures. CDS is headquartered in Toronto and has offices in Montreal, Calgary, and Vancouver. CDS is a subsidiary of The
Canadian Depository for Securities Limited, part of TMX Group Limited. It is affiliated with CDS Inc., which provides services to the Canadian Securities Administrators, and CDS Innovations Inc., a commercial marketer of CDS information products
such as CDS Bulletins and entitlements information.
The information in this prospectus concerning CDS and CDS’s book-entry system
has been obtained from sources that we believe to be reliable, but we take no responsibility for the accuracy of this information. CDS may change or discontinue its procedures at any time.
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Secondary market trading in Canadian notes between CDS participants will be in accordance
with market conventions applicable to transactions in book-based Canadian domestic bonds. Secondary market trading in Canadian notes between Euroclear participants and Clearstream, Luxembourg participants will occur in the ordinary way in accordance
with the applicable rules and operating procedures of Euroclear and Clearstream, Luxembourg, and will be settled using the procedures applicable to conventional Eurobonds.
Links have been established among CDS, Euroclear, and Clearstream, Luxembourg to facilitate the initial issuance of Canadian notes and
cross-market transfers of such Canadian notes associated with secondary market trading. CDS will be linked to Euroclear and Clearstream, Luxembourg through the CDS accounts of the respective Canadian Subcustodians of Euroclear and Clearstream,
Luxembourg.
Cross-market transfers of Canadian notes between persons holding directly or indirectly through CDS participants, on the one
hand, and directly or indirectly through Euroclear or Clearstream, Luxembourg participants, on the other, will be effected in CDS in accordance with CDS rules; however, these cross-market transactions will require delivery of instructions to the
relevant clearing system by the counterparty in that system in accordance with its rules and procedures and within its established deadlines. The relevant clearing system will, if the transaction meets its settlement requirements, deliver
instructions to CDS directly or through its Canadian Subcustodian to take action to effect final settlement on its behalf by delivering or receiving the relevant Canadian notes in CDS, and making or receiving payment in accordance with the normal
procedures for settlement in CDS. Euroclear and Clearstream, Luxembourg participants may not deliver instructions directly to CDS or to the Canadian Subcustodians.
Because of time-zone differences, credits of Canadian notes received in Euroclear or Clearstream, Luxembourg as a result of a transaction with
a CDS participant will be made during subsequent securities settlement processing and dated the business day following the CDS settlement date. Those credits or any transactions in Canadian notes settled during that processing will be reported to
the relevant Euroclear participants or Clearstream, Luxembourg participants on the applicable business day. Cash received in Euroclear or Clearstream, Luxembourg as a result of sales of Canadian notes by or through a Euroclear participant or a
Clearstream, Luxembourg participant to a CDS participant will be received with value on the CDS settlement date, but will be available in the relevant Euroclear or Clearstream, Luxembourg cash account only as of the business day following settlement
in CDS.
Notices given to CDS, as registered holder of Canadian notes, will be passed on to the beneficial owners of such Canadian notes
in accordance with the standard rules and procedures of CDS and its direct and indirect participants, including Euroclear and Clearstream, Luxembourg.
Special Considerations for Global Securities
As an indirect owner, an investor’s rights relating to a global security will be governed by the account rules of the depository and
those of the investor’s financial institution or other intermediary through which it holds its interest (e.g., Euroclear or Clearstream, Luxembourg, if DTC is the depository), as well as general laws relating to securities transfers. We do not
recognize this type of investor or any intermediary as a holder of securities. Instead, we deal only with the depository that holds the global security.
If securities are issued only in the form of a global security, an investor should be aware of the following:
•
an investor cannot cause the securities to be registered in his or her own name, and cannot obtain physical
certificates for his or her interest in the securities, except in the limited
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circumstances described in the relevant securities or in the indenture, agreement or other instrument governing the relevant securities;
•
an investor will be an indirect holder and must look to his or her own bank or broker for payments on the
securities and protection of his or her legal rights relating to the securities, as we describe above under “—Legal Holders”;
•
for debt securities, under existing industry practices, if we or the applicable trustee request any action of
owners of beneficial interests in any global security or if an owner of a beneficial interest in any global security desires to give instructions or take any action that a holder of an interest in a global security is entitled to give or take under
the applicable indenture, DTC, Euroclear, Clearstream, Luxembourg or CDS, as the case may be, would authorize the participants owning the relevant beneficial interests to give instructions or take such action, and such participants would authorize
indirect holders to give or take such action or would otherwise act upon the instructions of such indirect holders;
•
an investor may not be able to sell interests in the securities to some insurance companies and other
institutions that are required by law to own their securities in definitive form;
•
an investor may not be able to pledge his or her interest in a global security in circumstances where
certificates representing the securities must be delivered to the lender or other beneficiary of the pledge in order for the pledge to be effective; furthermore, as Euroclear and Clearstream, Luxembourg act on behalf of their respective participants
only, who in turn may act on behalf of their respective clients, the ability of beneficial owners who are not participants with Euroclear or Clearstream, Luxembourg to pledge interests in any global security to persons or entities that are not
participants with Euroclear or Clearstream, Luxembourg or otherwise take action in respect of interests in any global security, may be limited;
•
the depository’s policies will govern payments, deliveries, transfers, exchanges, notices, and other
matters relating to an investor’s interest in a global security, and those policies may change from time to time;
•
we, the trustee, any warrant agents, and any unit or other agents will not be responsible for any aspect of the
depository’s policies, actions, or records of ownership interests in a global security;
•
we, the trustee, any warrant agents, and any unit or other agents do not supervise the depository in any way;
•
the depository will require that those who purchase and sell interests in a global security within its book-entry
system use immediately available funds, and your broker or bank may require you to do so as well; and
•
financial institutions that participate in the depository’s book-entry system and through which an investor
holds its interest in the global securities, directly or indirectly, also may have their own policies affecting payments, deliveries, transfers, exchanges, notices, and other matters relating to the securities. Those policies may change from time to
time. For example, if you hold an interest in a global security through Euroclear or Clearstream, Luxembourg when DTC is the depository, Euroclear or Clearstream, Luxembourg, as applicable, will require those who purchase and sell interests in that
security through them to use immediately available funds and comply with other policies and procedures,
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including deadlines for giving instructions as to transactions that are to be effected on a particular day. There may be more than one financial intermediary in the chain of ownership for an
investor. We do not monitor and are not responsible for the policies or actions or records of ownership interests of any of those intermediaries.
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U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following is a general discussion of the material U.S. federal income tax considerations of the acquisition, ownership, and disposition of
certain of the debt securities, preferred stock, depositary shares representing fractional interests in preferred stock, and common stock that we are offering. The following discussion is not exhaustive of all possible tax considerations. This
summary is based upon the Internal Revenue Code of 1986, as amended (the “Code”), regulations promulgated under the Code by the U.S. Treasury Department (“Treasury”) (including proposed and temporary regulations), rulings,
current administrative interpretations and official pronouncements of the Internal Revenue Service (the “IRS”), and judicial decisions, all as currently in effect and all of which are subject to differing interpretations or to change,
possibly with retroactive effect. No assurance can be given that the IRS would not assert, or that a court would not sustain, a position contrary to any of the tax consequences described below. This section constitutes the opinion of Davis
Polk & Wardwell LLP, U.S. tax counsel to Bank of America Corporation.
This summary is for general information only, and does not
purport to discuss all aspects of U.S. federal income taxation that may be important to a particular investor in light of its investment or tax circumstances or to investors subject to special tax rules, such as: partnerships, or other entities
classified as partnerships for U.S. federal income tax purposes, subchapter S corporations, any government (or instrumentality or agency thereof), banks, financial institutions,
tax-exempt
entities, insurance
companies, regulated investment companies, real estate investment trusts, trusts and estates, dealers in securities or currencies, traders in securities that have elected to use the
mark-to-market
method of tax accounting for their securities, persons holding the debt securities, preferred stock, depositary shares, or common stock as part of an
integrated investment, including a “straddle,” “hedge,” “constructive sale,” or “conversion transaction,” persons (other than
Non-U.S.
Holders) whose functional
currency for tax purposes is not the U.S. dollar, and persons subject to the alternative minimum tax provisions of the Code. This summary does not address special rules applicable to a person required for U.S. federal income tax purposes to conform
the timing of income accruals with respect to the debt securities, preferred stock, depositary shares and common stock to its financial statements under Section 451(b) of the Code. This summary also does not include any description of the tax
laws of any state or local governments, or of any foreign government, that may be applicable to a particular holder. This summary also may not apply to all forms of debt securities, preferred stock, depositary shares, or common stock that we may
issue.
This discussion applies only to investors who, except as otherwise specifically noted:
•
will purchase the debt securities, preferred stock, depositary shares, or common stock offered in this prospectus
upon original issuance; and
•
will hold such securities as capital assets within the meaning of Section 1221 of the Code, which generally
means as property held for investment.
You should consult your own tax advisor concerning the U.S. federal income
tax consequences to you of acquiring, owning, and disposing of these securities (including the consequences resulting from the Medicare tax on investment income), as well as any tax consequences arising under the laws of any state, local,
non-U.S.,
or other tax jurisdiction and the possible effects of changes in U.S. federal or other tax laws.
As used in this prospectus, the term “U.S. Holder” means a beneficial owner of the debt securities, preferred stock, depositary
shares, or common stock offered in this prospectus that is for U.S. federal income tax purposes:
•
a citizen or individual resident of the United States;
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•
a corporation (including an entity treated as a corporation for U.S. federal income tax purposes) created or
organized in or under the laws of the United States or of any state of the United States or the District of Columbia; or
•
an estate or trust the income of which is subject to U.S. federal income taxation regardless of its source.
As used in this prospectus, the term
“Non-U.S.
Holder” is a
beneficial owner that is not a U.S. Holder and is not a partnership for U.S. federal income tax purposes.
If an entity or arrangement
treated as a partnership for U.S. federal income tax purposes holds the debt securities, preferred stock, depositary shares, or common stock offered in this prospectus, the U.S. federal income tax treatment of a partner generally will depend upon
the status of the partner and the activities of the partnership and accordingly, this summary does not apply to partnerships. A partner of a partnership holding the debt securities, preferred stock, depositary shares, or common stock should consult
its own tax advisor regarding the U.S. federal income tax consequences to the partner of the acquisition, ownership, and disposition by the partnership of the debt securities, preferred stock, depositary shares, or common stock.
This discussion is subject to any additional discussion regarding U.S. federal taxation contained in the applicable supplement. Accordingly,
you should also consult the applicable supplement for any additional discussion of U.S. federal taxation with respect to the specific debt securities, preferred stock, depositary shares or common stock offered thereunder.
Taxation of Debt Securities
This section describes the material U.S. federal income tax consequences of the acquisition, ownership, and disposition of the debt securities
offered in this prospectus, other than the debt securities described below under “—Convertible, Renewable, Extendible, Indexed, and Other Debt Securities,” which will be described in the applicable supplement. This section is
directed solely to holders that, except as otherwise specifically noted, will purchase the debt securities offered in this prospectus upon original issuance for cash at the issue price, as defined below.
Consequences to U.S. Holders
The following is a summary of the material U.S. federal income tax consequences that will apply to U.S. Holders of debt securities.
Payment of Stated Interest.
Except as described below in the case of interest on a debt security issued with original issue discount,
as defined below under “—Original Issue Discount,” stated interest on a debt security generally will be included in the income of a U.S. Holder as interest income at the time it is accrued or is received in accordance with the U.S.
Holder’s regular method of accounting for U.S. federal income tax purposes (“method of tax accounting”) and will be ordinary income.
Original Issue Discount.
Some of our debt securities may be issued with original issue discount (“OID”). U.S. Holders of
debt securities issued with OID, other than short-term debt securities with a maturity of one year or less from its date of issue (after taking into account the last possible date that the debt security could be outstanding under its terms), will be
subject to special tax accounting rules, as described in greater detail below. For tax purposes, OID is the excess of the “stated redemption price at maturity” of a debt security over its “issue price.” The “stated
redemption price at maturity” of a debt security is the sum of all payments required to be made on the debt security other than “qualified stated interest” payments. The “issue price” of a debt
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security is generally the first offering price to the public at which a substantial amount of the issue was sold (ignoring sales to bond houses, brokers, or similar persons or organizations
acting in the capacity of underwriters, placement agents, or wholesalers). Subject to any additional discussion in the applicable supplement and to the discussion below regarding reopenings, it is expected, and the discussion below assumes, that,
for U.S. federal income tax purposes, the issue price of a debt security is equal to its stated issue price indicated in the applicable supplement. The term “qualified stated interest” generally means stated interest that is
unconditionally payable in cash or property (other than debt instruments of the issuer), or that is treated as constructively received, at least annually at a single fixed rate or, under certain circumstances, at a variable rate. Subject to the
discussion below under “—Debt Securities Subject to Early Redemption,” if a debt security bears interest during any accrual period at a rate below the rate applicable for the remaining term of the debt security (for example, debt
securities with teaser rates or interest holidays), interest payable at the lowest stated fixed rate generally is qualified stated interest and the excess, if any, is included in the stated redemption price at maturity for purposes of determining
whether the debt security will be issued with original issue discount.
A U.S. Holder of a debt security with a maturity of more than one
year from its date of issue that has been issued with OID (an “OID debt security”) is generally required to include any qualified stated interest payments in income as interest at the time such interest is accrued or is received in
accordance with the U.S. Holder’s method of tax accounting, as described above under “—Payment of Stated Interest.” A U.S. Holder of an OID debt security is generally required to include in income the sum of the daily
accruals of the OID for the debt security for each day during the taxable year (or portion of the taxable year) in which the U.S. Holder held the OID debt security, regardless of such holder’s method of tax accounting. Thus, a U.S. Holder may
be required to include OID in income in advance of the receipt of some or all of the related cash payments. The daily portion is determined by allocating the OID for each day of the accrual period. An accrual period may be of any length and the
accrual periods may even vary in length over the term of the OID debt security, provided that each accrual period is no longer than one year and each scheduled payment of principal or interest occurs either on the first day of an accrual period or
on the final day of an accrual period. The amount of OID allocable to an accrual period is equal to the excess of: (1) the product of the “adjusted issue price” of the OID debt security at the beginning of the accrual period and its
yield to maturity (computed generally on a constant yield method and compounded at the end of each accrual period, taking into account the length of the particular accrual period) over (2) the amount of any qualified stated interest allocable
to the accrual period. OID allocable to a final accrual period is the difference between the amount payable at maturity, other than a payment of qualified stated interest, and the adjusted issue price at the beginning of the final accrual period.
Special rules will apply for calculating OID for an initial short accrual period. The “adjusted issue price” of an OID debt security at the beginning of any accrual period is the sum of the issue price of the OID debt security plus the
amount of OID allocable to all prior accrual periods reduced by any payments received on the OID debt security that were not qualified stated interest. Under these rules, a U.S. Holder generally will have to include in income increasingly greater
amounts of OID in successive accrual periods.
If the excess of the “stated redemption price at maturity” of a debt security
over its “issue price” is less than 0.25% of its stated redemption price at maturity multiplied by the number of complete years from its issue date to its maturity, or “weighted average maturity” in the case of debt
securities with more than one principal payment (“de minimis OID”), the debt security is not treated as issued with OID. The “weighted average maturity” is the sum of the following amounts determined for each payment under
the debt security other than a payment of qualified stated interest: (i) the number of complete years from the issue date of the debt security until the payment is made, multiplied by (ii) a fraction, the numerator of which is the amount
of the payment and the denominator of which is the debt security’s stated redemption price at maturity. A U.S. Holder generally must include the de minimis OID in income at the time payments, other than qualified
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stated interest, on the debt securities are made in proportion to the amount paid (unless the U.S. Holder makes the election described below under “—Election to Treat All Interest as
Original Issue Discount”). Any amount of de minimis OID that is included in income in this manner will be treated as capital gain.
Treasury regulations provide specific rules regarding whether additional debt securities issued in a reopening will be considered part of the
same issue, with the same issue price and yield to maturity, as the original debt securities to which they relate for U.S. federal income tax purposes. Except as provided otherwise in an applicable supplement, we intend to treat additional debt
securities issued by us in any reopening as part of the original issuance to which they relate for U.S. federal income tax purposes, and we therefore expect that the amount of OID on such additional debt securities will generally be the same as that
of the original debt securities to which they relate. However, if the IRS were to successfully challenge such treatment, the additional debt securities would not be treated as part of the same issuance as the original debt securities and, therefore,
the amount of OID on the additional debt securities could differ from that of the original debt securities to which such additional debt securities relate. In that event, because persons responsible for information reporting with respect to the debt
securities may not be able to determine whether original debt securities or additional debt securities are held by a particular holder, such persons may report an amount of OID to the holders of the debt securities and the IRS that exceeds the
amount required to be included in the U.S. Holder’s income. This may adversely impact the trading price (if any) for the entire series of the debt securities. Depending on a U.S. Holder’s purchase price, the additional debt securities
may have bond premium or market discount, in each case as discussed below under “—Amortizable Bond Premium” and “—Market Discount.”
Debt Securities Subject to Early Redemption
. A debt security subject to redemption prior to maturity may be subject to rules that
differ from the general rules described above for purposes of determining the yield and maturity of the debt security (which may affect whether the debt security is treated as issued with OID and, if so, the timing of accrual of the OID). Under
applicable Treasury regulations, we will generally be presumed to exercise an unconditional option to redeem a debt security if the exercise of the option will lower the yield on the debt security. Conversely, a U.S. Holder will generally be
presumed to exercise an unconditional option to require us to repurchase a debt security if the exercise of the option will increase the yield on the debt security. In either case, if such an option is not in fact exercised, the debt security will
be treated, solely for purposes of calculating OID, as if it were redeemed and a new debt security were issued on the presumed exercise date for an amount equal to the debt security’s adjusted issue price on that date.
Under these rules, if a debt security provides for a fixed rate of interest that increases over the term of the debt security, the debt
security’s issue price is not below its stated principal amount and we have an option to redeem the debt security for an amount equal to the stated principal amount (plus accrued interest, if any) on or prior to the first date on which an
increased rate of interest is in effect, the yield on the debt security will be lowered if we redeem the debt security before the initial increase in the interest rate, and therefore our redemption option will be treated as exercised. Since the debt
security will therefore be treated as if it were redeemed and reissued prior to the initial increase in the interest rate, the debt security will not be treated as issued with OID. If a debt security is not treated as issued with OID and if,
contrary to the presumption in the applicable Treasury regulations, we do not redeem the debt security before the initial increase in the interest rate, the same analysis will apply to all subsequent increases in the interest rate. This means that
the debt security that is deemed reissued will be treated as redeemed prior to any subsequent increase in the interest rate, and therefore as issued without OID. If the actual remaining term of a debt security is one year or less at the time of a
deemed reissuance, it is possible that the deemed reissued debt security would be treated as a short-term debt instrument. See “—Short-Term Debt Securities” below. While a debt security with a deemed remaining term of one year or
less based on the presumed exercise of an option should not be treated as a short-term
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debt instrument, the IRS or a court might treat the stated interest payable on the debt security as OID instead of qualified stated interest during that deemed remaining term. U.S. Holders should
consult with their own tax advisors regarding this uncertainty.
Additional rules applicable to debt securities with OID that are
denominated in or determined by reference to a currency other than the U.S. dollar are described under
“—Non-U.S.
Dollar Denominated Debt Securities” below.
Variable Rate Debt Securities
. In the case of a debt security that is a variable rate debt security, special rules apply. A debt
security will qualify as a “variable rate debt instrument” under Treasury regulations if (i) the debt security’s issue price does not exceed the total
non-contingent
principal payments
by more than the lesser of: (a) 0.015 multiplied by the product of the total
non-contingent
principal payments and the number of complete years to maturity from the issue date, or (b) 15% of the total
non-contingent
principal payments; (ii) the debt security provides for stated interest, compounded or paid at least annually, only at one or more qualified floating rates, a single fixed rate and one or more
qualified floating rates, a single objective rate, or a single fixed rate and a single objective rate that is a qualified inverse floating rate, each as defined in the applicable Treasury regulations; and (iii) certain other conditions, as set
forth in the applicable Treasury regulations, are satisfied.
Generally, a rate is a qualified floating rate if: (i) (a) variations
in the value of the rate can reasonably be expected to measure contemporaneous variations in the cost of newly borrowed funds in the currency in which the debt security is denominated; or (b) the rate is equal to such a rate multiplied by
either a fixed multiple that is greater than 0.65 but not more than 1.35 or a fixed multiple greater than 0.65 but not more than 1.35 increased or decreased by a fixed rate, and (ii) the value of the rate on any date during the term of the debt
security is set no earlier than three months prior to the first day on which that value is in effect and no later than one year following that first day. If a debt security provides for two or more qualified floating rates that are within 0.25% of
each other on the issue date or can reasonably be expected to have approximately the same values throughout the term of the debt security, the qualified floating rates together constitute a single qualified floating rate. A debt security will not
have a variable rate that is a qualified floating rate, however, if the variable rate of interest is subject to one or more minimum or maximum rate floors or ceilings or one or more governors limiting the amount of increase or decrease unless such
floor, ceiling, or governor is fixed throughout the term of the debt security or is not reasonably expected as of the issue date to significantly affect the yield on the debt security.
Generally, an objective rate is a rate (i) that is not a qualified floating rate, (ii) that is determined using a single fixed
formula that is based on objective financial or economic information that is not within the control of the issuer or a related party, and (iii) the value of which on any date during the term of the debt security is set no earlier than three
months prior to the first day on which that value is in effect and no later than one year following that first day. If it is reasonably expected that the average value of the variable rate during the first half of the term of a debt security will be
either significantly less than or significantly greater than the average value of the rate during the final half of the term of the debt security, then the debt security will not have a variable rate that is an objective rate. An objective rate is a
qualified inverse floating rate if that rate is equal to a fixed rate minus a qualified floating rate and variations in the rate can reasonably be expected to inversely reflect contemporaneous variations in the qualified floating rate.
A debt security will also have a variable rate that is a single qualified floating rate or an objective rate if interest on the debt security
is stated at a fixed rate for an initial period of one year or less followed by either a qualified floating rate or an objective rate for a subsequent period, and the value of the qualified floating rate or objective rate is intended to approximate
the fixed rate (which is presumed if (a) the fixed rate and (b) the qualified floating rate or objective rate have values on the issue date of the debt security that do not differ by more than 0.25%).
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In the case of a debt security that provides for stated interest that is unconditionally
payable at least annually at a variable rate that is a single qualified floating rate or objective rate, or one of those rates after a single fixed rate for an initial period of one year or less (as described above), all stated interest on the debt
security is treated as qualified stated interest. In that case, both the debt security’s yield to maturity and qualified stated interest will be determined, solely for purposes of calculating the accrual of OID, if any, as though the debt
security will bear interest in all periods throughout its term (in the case of a single qualified floating rate or qualified inverse floating rate) at a fixed rate generally equal to the value of the rate on the issue date or, in the case of an
objective rate (other than a qualified inverse floating rate), the rate that reflects the yield to maturity that is reasonably expected for the debt security (the “fixed rate substitute”). A U.S. Holder should then recognize OID, if any,
that is calculated based on the debt security’s assumed yield to maturity. If the interest actually accrued or paid during an accrual period exceeds or is less than the assumed fixed interest, the qualified stated interest allocable to that
period is increased or decreased, as applicable.
If a debt security provides for stated interest at multiple floating rates, the interest
and OID accruals on the debt security must be determined by (i) determining a fixed rate substitute for each qualified floating rate or qualified inverse floating rate provided under the debt security (as described above), (ii) constructing the
equivalent fixed rate debt instrument, using the fixed rate substitutes, (iii) determining the amount of qualified stated interest and OID with respect to the equivalent fixed rate debt instrument, and (iv) making appropriate adjustments
to qualified stated interest or OID for actual variable rates during the applicable accrual period.
In the case of a debt security that
provides for stated interest either at one or more qualified floating rates or at a qualified inverse floating rate and also provides for stated interest at a single fixed rate other than at a single fixed rate for an initial period (as described
above), the interest and OID accruals on the debt security must be determined by using the method described above. However, the debt security will be treated, for purposes of the first three steps of the determination, as if the debt security had
provided for a qualified floating rate, or a qualified inverse floating rate, rather than the fixed rate. The qualified floating rate, or qualified inverse floating rate, that replaces the fixed rate must be such that the fair market value of the
debt security as of the issue date approximates the fair market value of an otherwise identical debt instrument that provides for the qualified floating rate, or qualified inverse floating rate, rather than the fixed rate.
Fixed-Rate Reset Notes
. Unless otherwise provided in the applicable supplement, it is expected that a fixed-rate reset note will
qualify as a “variable rate debt instrument” that provides for stated interest at a single qualified floating rate in addition to a single fixed rate. Assuming that such treatment applies, a fixed-rate reset note will be subject to the
rules described above in “—Variable Rate Debt Securities.”
Acquisition Premium.
If a U.S. Holder purchases an
OID debt security for an amount greater than its adjusted issue price (as determined above) at the purchase date and less than or equal to the sum of all amounts, other than qualified stated interest, payable on the OID debt security after the
purchase date, the excess is “acquisition premium.” Under these rules, in general, the amount of OID which must be included in income for the debt security for any taxable year (or any portion of a taxable year in which the debt security
is held) will be reduced (but not below zero) by the portion of the acquisition premium allocated to the period. The amount of acquisition premium allocated to each period is determined by multiplying the OID that otherwise would have been included
in income by a fraction, the numerator of which is the excess of the cost over the adjusted issue price of the OID debt security and the denominator of which is the excess of the OID debt security’s stated redemption price at maturity over its
adjusted issue price.
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Amortizable Bond Premium.
If a U.S. Holder purchases a debt security for an amount in
excess of the sum of all amounts payable on the debt security after the purchase date, other than qualified stated interest, such U.S. Holder will be considered to have purchased such debt security with “amortizable bond premium” equal
in amount to such excess. A U.S. Holder may elect to amortize such premium as an offset to interest income using a constant yield method over the remaining term of the debt security based on the U.S. Holder’s yield to maturity with respect to
the debt security.
A U.S. Holder generally may use the amortizable bond premium allocable to an accrual period to offset interest
required to be included in the U.S. Holder’s income under its method of tax accounting with respect to the debt security in that accrual period. If the amortizable bond premium allocable to an accrual period exceeds the amount of interest
allocable to such accrual period, such excess would be allowed as a deduction for such accrual period, but only to the extent of the U.S. Holder’s prior interest inclusions on the debt security that have not been offset previously by bond
premium. Any excess is generally carried forward and allocable to the next accrual period.
If a debt security may be redeemed by us prior
to its maturity date, the amount of amortizable bond premium will be based on the amount payable at the applicable redemption date, but only if use of the redemption date (in lieu of the stated maturity date) results in a smaller amortizable bond
premium for the period ending on the redemption date.
An election to amortize bond premium applies to all taxable debt obligations held
by the U.S. Holder at the beginning of the first taxable year to which the election applies and thereafter acquired by the U.S. Holder and may be revoked only with the consent of the IRS. Generally, a U.S. Holder may make an election to include in
income its entire return on a debt security (i.e., the excess of all remaining payments to be received on the debt security over the amount paid for the debt security by such U.S. Holder) in accordance with a constant yield method based on the
compounding of interest, as discussed below under “—Election to Treat All Interest as Original Issue Discount.” If a U.S. Holder makes such an election for a debt security with amortizable bond premium, such election will result in
a deemed election to amortize bond premium for all of the U.S. Holder’s debt instruments with amortizable bond premium and may be revoked only with the permission of the IRS.
A U.S. Holder that elects to amortize bond premium will be required to reduce its tax basis in the debt security by the amount of the premium
amortized during its holding period. OID debt securities purchased at a premium will not be subject to the OID rules described above. If a U.S. Holder does not elect to amortize bond premium, the amount of bond premium will be included in its tax
basis in the debt security. Therefore, if a U.S. Holder does not elect to amortize bond premium and it holds the debt security to maturity, the premium generally will be treated as capital loss when the debt security matures.
Market Discount.
If a U.S. Holder purchases a debt security for an amount that is less than its stated redemption price at maturity,
or, in the case of an OID debt security, its adjusted issue price, such U.S. Holder will be considered to have purchased the debt security with “market discount.” Any payment, other than qualified stated interest, or any gain upon a
sale, exchange, retirement or other taxable disposition (each, a “taxable disposition”) of a debt security with market discount generally will be treated as ordinary income to the extent of the market discount not previously included in
income that accrued on the debt security during such U.S. Holder’s holding period. In general, market discount is treated as accruing on a straight-line basis over the term of the debt security unless an election is made to accrue the market
discount under a constant yield method. In addition, a U.S. Holder may be required to defer, until the maturity of the debt security
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or its earlier taxable disposition, the deduction of a portion of the interest paid on any indebtedness incurred or maintained to purchase or carry the debt security in an amount not exceeding
the accrued market discount on the debt security.
A U.S. Holder may elect to include market discount in income currently as it accrues
(on either a straight-line or constant yield basis), in lieu of treating a portion of any gain realized upon a taxable disposition of the debt security as ordinary income. If an election is made to include market discount on a current basis, the
interest deduction deferral rule described above will not apply. If a U.S. Holder makes such an election, it will apply to all market discount debt instruments acquired by such U.S. Holder on or after the first day of the first taxable year to which
the election applies. The election may not be revoked without the consent of the IRS. U.S. Holders should consult with their own tax advisors before making this election.
If the difference between the stated redemption price at maturity of a debt security or, in the case of an OID debt security, its adjusted
issue price, and the amount paid for the debt security is less than 0.25% of its stated redemption price at maturity or, in the case of an OID debt security, its adjusted issue price, multiplied by the number of remaining complete years to the debt
security’s maturity (“de minimis market discount”), the U.S. Holder is not treated as acquiring the debt security at a market discount.
Generally, a U.S. Holder may make an election to include in income its entire return on a debt security (i.e., the excess of all remaining
payments to be received on the debt security over the amount paid for the debt security by such U.S. Holder) in accordance with a constant yield method based on the compounding of interest, as discussed below under “—Election to Treat
All Interest as Original Issue Discount.” If a U.S. Holder makes such an election for a debt security with market discount, the U.S. Holder will be required to include market discount in income currently as it accrues on a constant yield basis
for all market discount debt instruments acquired by such U.S. Holder on or after the first day of the first taxable year to which the election applies, and such election may be revoked only with the permission of the IRS.
Election to Treat All Interest as Original Issue Discount.
A U.S. Holder may elect to include in income all interest that accrues on a
debt security using the constant-yield method applicable to OID described above, subject to certain limitations and exceptions. For purposes of this election, interest includes stated interest, acquisition discount, OID, de minimis OID, market
discount, de minimis market discount, and unstated interest, as adjusted by any amortizable bond premium or acquisition premium, each as described herein. If this election is made for a debt security, then, to apply the constant-yield method:
(i) the issue price of the debt security will equal its cost, (ii) the issue date of the debt security will be the date it was acquired, and (iii) no payments on the debt security will be treated as payments of qualified stated
interest. A U.S. Holder must make this election for the taxable year in which the debt security was acquired, and may not revoke the election without the consent of the IRS. U.S. Holders should consult with their own tax advisors before making this
election.
Debt Securities That Trade “Flat
.
”
We expect that certain debt securities will trade in the secondary
market with accrued interest. However, we may issue debt securities with terms and conditions that would make it likely that such debt securities would trade “flat” in the secondary market, which means that upon a sale of a debt security
a U.S. Holder would not be paid a separate amount that reflects the accrued but unpaid interest with respect to such debt security. Nevertheless, for U.S. federal income tax purposes, a portion of the sales proceeds equal to the interest accrued
with respect to such debt security from the last interest payment date to the sale date must be treated as interest income rather than as an amount realized upon the sale. Accordingly, a U.S. Holder that sells such a debt security between interest
payment dates would be
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required to recognize interest income and, in certain circumstances, would recognize a capital loss (the deductibility of which is subject to limitations) on the sale of the debt security.
Concurrently, a U.S. Holder that purchases such a debt security between interest payment dates would not be required to include in income that portion of any interest payment received that is attributable to interest that accrued prior to the
purchase. Such payment is generally treated as a return of capital which reduces the U.S. Holder’s remaining cost basis in the debt security. However, interest that accrues after the purchase date is included in income in the year received or
accrued (depending on the U.S. Holder’s method of tax accounting). U.S. Holders that purchase such debt securities between interest payment dates should consult their own tax advisors concerning such U.S. Holders’ adjusted tax basis in
the debt security and whether such debt securities should be treated as having been purchased with market discount, as described above.
Short-Term Debt Securities
. Some of our debt securities may be issued with maturities of one year or less from the date of issue (after
taking into account the last possible date that the debt security could be outstanding under its terms), which we refer to as short-term debt securities. Treasury regulations provide that no payments of interest on a short-term debt security are
treated as qualified stated interest. Accordingly, in determining the amount of discount on a short-term debt security, all interest payments, including stated interest, are included in the short-term debt security’s stated redemption price at
maturity.
In general, U.S. Holders using the cash method of tax accounting will not be required to include accrued discount on short-term
debt securities in income currently unless they elect to do so, but will be required to include any stated interest in income as the interest is received, except to the extent already included under such election. However, a cash method U.S. Holder
will be required to treat any gain realized upon a taxable disposition of the short-term debt security as ordinary income to the extent such gain does not exceed the discount accrued with respect to the short-term debt security, which will be
determined on a straight-line basis unless the U.S. Holder makes an election to accrue the discount under the constant-yield method, through the date of the taxable disposition. Any gain in excess of this amount will be treated as short-term capital
gain. Any loss recognized will be treated as a capital loss. In addition, a cash method U.S. Holder that does not elect to include accrued discount in income currently will not be allowed to deduct any of the interest paid or accrued on any
indebtedness incurred or maintained to purchase or carry a short-term debt security (in an amount not exceeding the deferred income), but instead will be required to defer deductions for such interest until the deferred income is realized upon the
maturity of the short-term debt security or its earlier disposition in a taxable transaction. Notwithstanding the foregoing, a cash method U.S. Holder of a short-term debt security may elect to include accrued discount in income on a current basis.
If this election is made, the limitation on the deductibility of interest described above will not apply.
A U.S. Holder using the accrual
method of tax accounting generally will be required to include accrued discount on a short-term debt security in income on a current basis, on either a straight-line basis or, at the election of the U.S. Holder, under the constant-yield method based
on daily compounding.
Regardless of whether a U.S. Holder is a cash or accrual method holder, it may elect to include accrued acquisition
discount with respect to a short-term debt security in income on a current basis. “Acquisition discount” is the excess of the remaining redemption amount of the short-term debt security at the time of acquisition over the purchase price.
Acquisition discount will be treated as accruing on a straight-line basis or, at the election of the U.S. Holder, under a constant yield method based on daily compounding. If a U.S. Holder elects to include accrued acquisition discount in income,
the rules for including OID will not apply. In addition, the market discount rules described above will not apply to short-term debt securities.
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Sale, Exchange, Retirement or other Taxable Disposition
. Upon a taxable disposition
of a debt security, a U.S. Holder will recognize gain or loss equal to the difference between the amount realized upon the taxable disposition (less an amount equal to any accrued interest not previously included in income if the debt security is
disposed of between interest payment dates, which will be included in income as interest income for U.S. federal income tax purposes) and the U.S. Holder’s adjusted tax basis in the debt security. The amount realized by the U.S. Holder will
include the amount of any cash and the fair market value of any other property received for the debt security. A U.S. Holder’s adjusted tax basis in a debt security generally will be the cost of the debt security to such U.S. Holder, increased
by any OID, market discount, de minimis OID, de minimis market discount, or any discount with respect to a short-term debt security previously included in income with respect to the debt security, and decreased by the amount of any premium
previously amortized to reduce interest on the debt security and the amount of any payment (other than a payment of qualified stated interest) received in respect of the debt security.
Except as discussed above with respect to market discount, or as described below with respect to debt securities subject to contingencies and
Non-U.S.
Dollar Denominated Debt Securities, gain or loss realized upon a taxable disposition of a debt security generally will be capital gain or loss and will be long-term capital gain or loss if the debt security
has been held for more than one year. Net long-term capital gain recognized by an individual U.S. Holder is generally taxed at preferential rates. The ability of U.S. Holders to deduct capital losses is subject to limitations under the Code. If a
U.S. Holder recognizes a loss above certain thresholds, the U.S. Holder may be required to file a Form 8886 with the IRS, as discussed under “Reportable Transactions” below.
Debt Securities Subject to Contingencies
. Certain of the debt securities may provide for an alternative payment schedule or schedules
applicable upon the occurrence of a contingency or contingencies, other than a remote or incidental contingency, whether such contingency relates to payments of interest or of principal. In addition, subject to the discussion above under
“—Debt Securities Subject to Early Redemption,” certain of the debt securities may contain provisions permitting them to be redeemed prior to their stated maturity at our option and/or at the option of the holder. Debt securities
containing these features may be characterized as “contingent payment debt instruments” for U.S. federal income tax purposes.
If the debt securities are properly characterized as contingent payment debt instruments for U.S. federal income tax purposes, such debt
securities generally will be subject to Treasury regulations governing contingent payment debt instruments. Under those regulations, a U.S. Holder will be required to report OID based on a “comparable yield” and a “projected
payment schedule,” both as described below, established by us for determining interest accruals and adjustments with respect to the debt security.
The “comparable yield” and “projected payment schedule,” which will
generally be included in the applicable pricing supplement, are not used for any purpose other than to determine interest accruals and adjustments thereto in respect of the debt securities for U.S. federal income tax purposes. They do not constitute
a projection or representation by us regarding the actual amounts that will be paid on the debt securities.
A U.S. Holder that does not use the “comparable yield” and follow the “projected payment schedule” to calculate
its OID on a debt security must timely disclose and justify the use of other estimates to the IRS. No payments on a contingent payment debt instrument are treated as qualified stated interest.
A “comparable yield” with respect to a debt security generally is the yield at which we could issue a fixed-rate debt instrument
with terms similar to those of the debt security (taking into account for this purpose the level of subordination, term, timing of payments, and general market conditions, but ignoring any adjustments for liquidity or the riskiness of the
contingencies with respect to the debt security). Notwithstanding the foregoing, a comparable yield must not be less than the applicable U.S. federal rate based on the overall maturity of the debt security.
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A “projected payment schedule” with respect to a debt security generally is a
series of projected payments, the amount and timing of which would produce a yield to maturity on that debt security equal to the comparable yield. This projected payment schedule will consist of a projection for tax purposes of each
non-contingent
and contingent payment.
Based on the comparable yield and the projected payment schedule
of the debt securities, a U.S. Holder of a debt security (regardless of its method of tax accounting) generally will be required to accrue as OID the sum of the daily portions of interest on the debt security for each day in the taxable year on
which the U.S. Holder held the debt security, adjusted upward or downward to reflect the difference, if any, between the actual and projected amount of any contingent payments on the debt security, as set forth below. The daily portions of interest
for a debt security are determined by allocating to each day in an accrual period the ratable portion of interest on the debt security that accrues in the accrual period. The amount of interest on the debt security that accrues in an accrual period
is the product of the comparable yield on the debt security (adjusted to reflect the length of the accrual period) and the adjusted issue price of the debt security at the beginning of the accrual period. The adjusted issue price of a debt security
at the beginning of the first accrual period will equal its issue price (as described above). For any subsequent accrual period, the adjusted issue price will be (i) the sum of the issue price of the debt security and any interest previously
accrued on the debt security by the U.S. Holder (without regard to any positive or negative adjustments, described below) minus (ii) the amount of any projected payments on the debt security for previous accrual periods.
A U.S. Holder of a debt security generally will be required to include in income OID in excess of actual cash payments received for certain
taxable years. In addition to the accrued OID, a U.S. Holder will be required to recognize interest income equal to the amount of any positive adjustment for a debt security for the taxable year in which a contingent payment is paid (including a
payment of interest at maturity). A positive adjustment is the excess of actual payments in respect of contingent payments over the projected amount of contingent payments. A U.S. Holder also will be required to account for any “negative
adjustment” for a taxable year in which a contingent payment is paid. A negative adjustment is the excess of the projected amounts of contingent payments over actual payments in respect of the contingent payments. A net negative adjustment is
the amount by which total negative adjustments in a taxable year exceed total positive adjustments in such taxable year. A net negative adjustment (i) will first reduce the amount of interest for the debt security that a U.S. Holder would
otherwise be required to include in income in the taxable year, and (ii) to the extent of any excess, will result in an ordinary loss equal to that portion of the excess as does not exceed the excess of (a) the amount of all previous
interest inclusions under the debt security over (b) the total amount of the U.S. Holder’s net negative adjustments treated as ordinary loss on the debt security in prior taxable years. A net negative adjustment is not treated as a
miscellaneous itemized deduction under Section 67 of the Code (for which a deduction would be unavailable or, beginning in 2026, available only to a limited extent). Any net negative adjustment in excess of the amounts described above in
(i) and (ii) will be carried forward to offset future interest income on the debt security or to reduce the amount realized upon a taxable disposition of the debt security.
If a contingent payment becomes fixed (within the meaning of applicable Treasury regulations) more than six months before its due date, a
positive or negative adjustment, as appropriate, is made to reflect the difference between the present value of the amount that is fixed and the present value of the projected amount. The present value of each amount is determined by discounting the
amount from the date the payment is due to the date the payment becomes fixed, using a discount rate equal to the comparable yield. If all remaining scheduled contingent payments on the debt security become fixed substantially contemporaneously,
applicable Treasury regulations provide that, with regard to contingent payments that become fixed on a day that is more than six months before their due date, U.S. Holders should take into account positive or negative adjustments in
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respect of such contingent payments over the period to which they relate in a reasonable manner. For purposes of the preceding sentence, a payment (including an amount payable at maturity) will
be treated as fixed if (and when) all remaining contingencies with respect to it are remote or incidental within the meaning of the applicable Treasury regulations. A U.S. Holder’s tax basis in the debt security and the character of any gain
or loss on the sale of the debt security will also be affected. U.S. Holders should consult their tax advisors concerning the application of these special rules, including as to what would be a “reasonable manner” in their particular
situation.
Upon a taxable disposition of a debt security prior to maturity, a U.S. Holder generally will recognize taxable gain or loss
equal to the difference between the amount realized upon the taxable disposition and that U.S. Holder’s tax basis in the debt security. A U.S. Holder’s tax basis in a debt security generally will equal the cost of that debt security,
increased by the amount of OID previously accrued by the U.S. Holder for that debt security (without regard to any positive or negative adjustments) and reduced by any projected payments for previous periods on the debt securities. A U.S. Holder
generally will treat any gain as interest income and will treat any loss as ordinary loss to the extent of the excess of previous interest inclusions over the total negative adjustments previously taken into account as ordinary losses, and the
balance as long-term or short-term capital loss depending upon the U.S. Holder’s holding period for the debt security. The deductibility of capital losses by a U.S. Holder is subject to limitations. If the U.S. Holder recognizes a loss above
certain thresholds, the U.S. Holder may be required to file a Form 8886 with the IRS, as discussed under “Reportable Transactions” below.
U.S. Holders considering the purchase of debt securities with these features should carefully examine the applicable supplement and should
consult their own tax advisors regarding the U.S. federal income tax consequences to a U.S. Holder of the purchase, ownership and disposition of such debt securities.
Non-U.S.
Dollar Denominated Debt Securities.
Additional considerations apply to a U.S. Holder
of a debt security payable in a currency other than U.S. dollars (“foreign currency”).
We refer to these securities as
Non-U.S.
Dollar Denominated Debt Securities. In the case of payments of stated interest, U.S. Holders using the cash method of tax accounting will be required to include in income the U.S. dollar value of the
foreign currency payment on a
Non-U.S.
Dollar Denominated Debt Security (other than OID or market discount) when the payment of interest is received. The U.S. dollar value of the foreign currency payment is
determined by translating the foreign currency received at the spot rate for such foreign currency on the date the payment is received, regardless of whether the payment is in fact converted to U.S. dollars at that time. The U.S. dollar value will
be the U.S. Holder’s tax basis in the foreign currency received. The U.S. Holder will not recognize foreign currency exchange gain or loss with respect to the receipt of such payment.
U.S. Holders using the accrual method of tax accounting will be required to include in income the U.S. dollar value of the amount of interest
income that has accrued and is otherwise required to be taken into account with respect to a
Non-U.S.
Dollar Denominated Debt Security during an accrual period. The U.S. dollar value of the accrued income will
be determined by translating the income at the average rate of exchange for the accrual period or, with respect to an accrual period that spans two taxable years, at the average rate for the partial period within the taxable year. A U.S. Holder may
elect, however, to translate the accrued interest income using the exchange rate on the last day of the accrual period or, with respect to an accrual period that spans two taxable years, using the exchange rate on the last day of the taxable year.
If the last day of an accrual period is within five business days of the date of receipt of the accrued interest, a U.S. Holder may translate the interest using the exchange rate on the date of receipt. The above election will apply to all other
debt obligations held by the U.S. Holder and the election may not be changed without
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the consent of the IRS. U.S. Holders should consult their own tax advisors before making the above election. Upon receipt of an interest payment (including, upon the sale of the debt security,
the receipt of proceeds which include amounts attributable to accrued interest previously included in income), the U.S. Holder will recognize foreign currency exchange gain or loss in an amount equal to the difference between the U.S. dollar value
of such payment (determined by translating the foreign currency received at the spot rate for such foreign currency on the date such payment is received) and the U.S. dollar value of the interest income previously included in income with respect to
such payment. This gain or loss will be treated as ordinary income or loss.
OID on a debt security that is also a
Non-U.S.
Dollar Denominated Debt Security will be determined for any accrual period in the applicable foreign currency and then translated into U.S. dollars, in the same manner as interest income accrued by a U.S.
Holder on the accrual basis, as described above (regardless of such U.S. Holder’s method of tax accounting). A U.S. Holder will recognize foreign currency exchange gain or loss when OID is paid (including, upon the sale of such debt security,
the receipt of proceeds which include amounts attributable to OID previously included in income) to the extent of the difference between the U.S. dollar value of such payment (determined by translating the foreign currency received at the spot rate
for such foreign currency on the date such payment is received) and the U.S. dollar value of the accrued OID (determined in the same manner as for accrued interest). For these purposes, all receipts on a debt security will be viewed: (i) first,
as the receipt of any stated interest payment called for under the terms of the debt security, (ii) second, as receipts of previously accrued OID (to the extent thereof), with payments considered made for the earliest accrual periods first, and
(iii) third, as the receipt of principal.
The amount of market discount on
Non-U.S.
Dollar
Denominated Debt Securities includible in income generally will be determined by translating the market discount determined in the foreign currency into U.S. dollars at the spot rate on the date the
Non-U.S.
Dollar Denominated Debt Security is retired or otherwise disposed of. If a U.S. Holder elected to accrue market discount currently, then the amount which accrues is determined in the foreign currency and then translated into U.S. dollars on the
basis of the average exchange rate in effect during such accrual period. A U.S. Holder will recognize foreign currency exchange gain or loss with respect to market discount which is accrued currently using the approach applicable to the accrual of
interest income as described above.
Amortizable bond premium on a
Non-U.S.
Dollar Denominated
Debt Security will be computed in the applicable foreign currency. If a U.S. Holder elected to amortize the premium, the amortizable bond premium will reduce interest income in the applicable foreign currency. At the time bond premium is amortized,
foreign currency exchange gain or loss will be realized based on the difference between spot rates at such time and the time of acquisition of the
Non-U.S.
Dollar Denominated Debt Security. If a U.S. Holder
does not elect to amortize bond premium, the bond premium computed in the foreign currency must be translated into U.S. dollars at the spot rate on the maturity date and such bond premium will constitute a capital loss which may be offset or
eliminated by foreign currency exchange gain.
If a U.S. Holder purchases a
Non-U.S.
Dollar
Denominated Debt Security with previously owned foreign currency, foreign currency exchange gain or loss (which will be treated as ordinary income or loss) will be recognized in an amount equal to the difference, if any, between the tax basis in the
foreign currency and the U.S. dollar fair market value of the foreign currency used to purchase the
Non-U.S.
Dollar Denominated Debt Security, determined on the date of purchase.
Upon a taxable disposition of a
Non-U.S.
Dollar Denominated Debt Security, a U.S. Holder will
recognize gain or loss equal to the difference between the amount realized upon the taxable disposition (less an amount equal to any accrued and unpaid interest not previously included in income, which will be treated as a payment of interest for
U.S. federal income tax purposes) and
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the adjusted tax basis in the
Non-U.S.
Dollar Denominated Debt Security. The adjusted tax basis in a
Non-U.S.
Dollar Denominated Debt Security will equal the amount paid for the
Non-U.S.
Dollar Denominated Debt Security, increased by the amounts of any market discount or OID previously included in income with respect
to the
Non-U.S.
Dollar Denominated Debt Security and reduced by any amortized premium and any principal payments received in respect of the
Non-U.S.
Dollar Denominated
Debt Security. The amount of any payment in or adjustments measured by foreign currency will be equal to the U.S. dollar value of the foreign currency on the date of the purchase or adjustment. The amount realized will be based on the U.S. dollar
value of the foreign currency on the date the payment is received or the
Non-U.S.
Dollar Denominated Debt Security is disposed of (or deemed disposed of as a result of a material change in the terms of the
debt security). If, however, a
Non-U.S.
Dollar Denominated Debt Security is traded on an established securities market and the U.S. Holder uses the cash method of tax accounting, the U.S. dollar value of the
tax basis and amount realized will be determined by translating the foreign currency payment at the spot rate of exchange on the settlement date of the purchase or sale. A U.S. Holder that uses the accrual method of tax accounting may elect the same
treatment with respect to the purchase and sale of
Non-U.S.
Dollar Denominated Debt Securities traded on an established securities market, provided that the election is applied consistently. This election
cannot be changed without the consent of the IRS.
Except with respect to market discount as discussed above, and the foreign currency
rules discussed below, gain or loss recognized upon a taxable disposition of a
Non-U.S.
Dollar Denominated Debt Security will be capital gain or loss and will be long-term capital gain or loss if at the time
of the taxable disposition the
Non-U.S.
Dollar Denominated Debt Security has been held for more than one year. Net long-term capital gain recognized by an individual U.S. Holder is generally taxed at
preferential rates. The ability of U.S. Holders to deduct capital losses is subject to limitations under the Code. If a U.S. Holder recognizes a loss above certain thresholds, the U.S. Holder may be required to file a disclosure statement with the
IRS, as discussed under “Reportable Transactions” below.
A portion of the gain or loss with respect to the principal amount
of a
Non-U.S.
Dollar Denominated Debt Security may be treated as foreign currency exchange gain or loss. Foreign currency exchange gain or loss will be treated as ordinary income or loss. For these purposes,
the principal amount of the
Non-U.S.
Dollar Denominated Debt Security is the purchase price for the
Non-U.S.
Dollar Denominated Debt Security calculated in the foreign
currency on the date of purchase, and the amount of exchange gain or loss recognized is equal to the difference between (i) the U.S. dollar value of the principal amount determined on the date of the taxable disposition of the
Non-U.S.
Dollar Denominated Debt Security and (ii) the U.S. dollar value of the principal amount determined on the date the
Non-U.S.
Dollar Denominated Debt Security was
purchased. The amount of foreign currency exchange gain or loss will be limited to the amount of overall gain or loss realized on the disposition of the
Non-U.S.
Dollar Denominated Debt Security.
The tax basis in foreign currency received as interest on a
Non-U.S.
Dollar Denominated Debt Security
will be the U.S. dollar value of the foreign currency determined at the spot rate in effect on the date the foreign currency is received. The tax basis in foreign currency received upon a taxable disposition of a
Non-U.S.
Dollar Denominated Debt Security will be equal to the U.S. dollar value of the foreign currency, determined at the time of the taxable disposition. As discussed above, if the
Non-U.S.
Dollar Denominated Debt Securities are traded on an established securities market, a cash method U.S. Holder (or, upon election, an accrual method U.S. Holder) will determine the U.S. dollar value of the
foreign currency by translating the foreign currency received at the spot rate of exchange on the settlement date of the taxable disposition. Accordingly, in such case, no foreign currency exchange gain or loss will result from currency fluctuations
between the trade date and settlement date of a taxable disposition. Any gain or loss recognized upon a taxable disposition of
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foreign currency (including its exchange for U.S. dollars or its use to purchase debt securities) will be ordinary income or loss.
Special rules may apply to
Non-U.S.
Dollar Denominated Debt Securities that are also treated as
contingent payment debt instruments. For the special treatment, if any, of
Non-U.S.
Dollar Denominated Debt Securities that are also contingent payment debt securities, see the applicable supplement.
Consequences to
Non-U.S.
Holders
The following is a summary of the material U.S. federal income tax consequences that will apply to
Non-U.S.
Holders of debt securities.
Non-U.S.
Holders should consult their own tax advisors regarding the U.S. and
non-U.S.
tax
considerations of acquiring, holding, and disposing of debt securities.
Payments of Interest.
Subject to the discussions
below concerning backup withholding and FATCA, principal (and premium, if any) and interest payments, including any OID, that are received from us or our agent and that are not effectively connected with the conduct by the
Non-U.S.
Holder of a trade or business within the United States, or a permanent establishment maintained in the United States if certain tax treaties apply, generally will not be subject to U.S. federal income or
withholding tax except as provided below. Interest, including any OID, may be subject to a 30% withholding tax (or less under an applicable treaty, if any) if:
•
a
Non-U.S.
Holder actually or constructively owns 10% or more of the
total combined voting power of all classes of our stock entitled to vote;
•
a
Non-U.S.
Holder is a “controlled foreign corporation” for
U.S. federal income tax purposes that is related to us (directly or indirectly) through stock ownership;
•
a
Non-U.S.
Holder is a bank extending credit under a loan agreement in
the ordinary course of its trade or business;
•
the interest payments on the debt security are determined by reference to the income, profits, changes in the
value of property or other attributes of the debtor or a related party (other than payments that are based on the value of a security or index of securities that are, and will continue to be, actively traded within the meaning of
Section 1092(d) of the Code, and that are not nor will be a “United States real property interest” as described in Section 897(c)(1) or 897(g) of the Code); or
•
the
Non-U.S.
Holder does not satisfy the certification requirements
described below.
A
Non-U.S.
Holder generally will satisfy the certification
requirements if either: (A) the
Non-U.S.
Holder certifies to the applicable withholding agent, under penalties of perjury, that it is a
non-U.S.
person and provides
its name and address (which certification may generally be made on an IRS Form
W-8BEN
or
W-8BEN-E,
or a successor form), or
(B) a securities clearing organization, bank, or other financial institution that holds customer securities in the ordinary course of its trade or business (a “financial institution”) and holds the debt security certifies to the
applicable withholding agent under penalties of perjury that either it or another financial institution has received the required statement from the
Non-U.S.
Holder certifying that it is a
non-U.S.
person and furnishes us with a copy of the statement.
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Payments not meeting the requirements set forth above and thus subject to withholding of
U.S. federal income tax may nevertheless be exempt from withholding (or subject to withholding at a reduced rate) if the
Non-U.S.
Holder provides the applicable withholding agent with a properly executed IRS
Form
W-8BEN
or
W-8BEN-E
(or successor form) claiming an exemption from, or reduction in, withholding under the benefit of a tax
treaty, or IRS Form
W-8ECI
(or other applicable form) stating that interest paid on the debt securities is not subject to withholding tax because it is effectively connected with the conduct of a trade or
business within the United States as discussed below. To claim benefits under an income tax treaty, a
Non-U.S.
Holder must obtain a taxpayer identification number and certify as to its eligibility under the
appropriate treaty’s limitations on benefits article. In addition, special rules may apply to claims for treaty benefits made by
Non-U.S.
Holders that are entities rather than individuals. A
Non-U.S.
Holder that is eligible for a reduced rate of U.S. federal withholding tax pursuant to an income tax treaty may obtain a refund of any excess amounts withheld by filing an appropriate claim for refund with
the IRS.
Sale, Exchange, Retirement or other Taxable Disposition.
A
Non-U.S.
Holder
generally will not be subject to U.S. federal income or withholding tax on any capital gain or market discount realized upon a taxable disposition of debt securities, provided that: (a) the gain is not effectively connected with the conduct of
a trade or business within the United States, or a permanent establishment maintained in the United States if certain tax treaties apply, (b) in the case of a
Non-U.S.
Holder that is an individual, the
Non-U.S.
Holder is not present in the United States for 183 days or more in the taxable year of the taxable disposition of the debt security, and (c) the
Non-U.S.
Holder
is not subject to tax pursuant to certain provisions of U.S. federal income tax law applicable to certain expatriates. An individual
Non-U.S.
Holder who is present in the United States for 183 days or more in
the taxable year of the taxable disposition of a debt security, provided that certain other conditions are met, will be subject to U.S. federal income tax at a rate of 30% on the gain realized upon the taxable disposition of such debt security.
Income Effectively Connected with a Trade or Business within the United States
. If a
Non-U.S.
Holder of a debt security is engaged in the conduct of a trade or business within the United States and if interest (including any OID) on the debt security, or gain realized upon a taxable disposition of the debt security, is effectively connected
with the conduct of such trade or business (and, if certain tax treaties apply, is attributable to a permanent establishment maintained by the
Non-U.S.
Holder in the United States), the
Non-U.S.
Holder, although exempt from U.S. federal withholding tax (provided that the certification requirements discussed above are satisfied), generally will be subject to U.S. federal income tax on such interest
(including any OID) or gain on a net income basis in the same manner as if it were a U.S. Holder.
Non-U.S.
Holders should read the material under the heading “—Consequences to U.S. Holders”
for a description of the U.S. federal income tax consequences of acquiring, owning, and disposing of debt securities. In addition, if such
Non-U.S.
Holder is a corporation, it may also be subject to a branch
profits tax equal to 30% (or lower rate under an applicable treaty, if any) of a portion of its earnings and profits for the taxable year that are effectively connected with its conduct of a trade or business in the United States, subject to certain
adjustments.
Convertible, Renewable, Extendible, Indexed, and Other Debt Securities
Special U.S. federal income tax rules are applicable to certain other debt securities, including contingent
Non-U.S.
Dollar Denominated Debt Securities, debt securities that may be convertible into or exercisable or exchangeable for our common or preferred stock or other securities or debt or equity securities of
one or more third parties, debt securities the payments on which are determined or partially determined by reference to any index and other debt securities that are subject to the rules governing contingent payment obligations, any renewable and
extendible debt securities and any debt securities providing for the periodic payment of principal over the life of the
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debt security. The material U.S. federal income tax considerations with respect to these debt securities will be discussed in the applicable supplement.
Backup Withholding and Information Reporting
In general, in the case of a U.S. Holder, other than certain exempt holders, we and other payors are required to report to the IRS all
payments of principal, any premium, and interest on the debt security, and the accrual of OID on an OID debt security. In addition, we and other payors generally are required to report to the IRS any payment of proceeds of the sale of a debt
security before maturity. Additionally, backup withholding generally will apply to any payments, including payments of OID, if a U.S. Holder fails to provide an accurate taxpayer identification number and certify that the taxpayer identification
number is correct, the U.S. Holder is notified by the IRS that it has failed to report all interest and dividends required to be shown on its U.S. federal income tax returns or a U.S. Holder does not certify that it has not underreported its
interest and dividend income.
In the case of a
Non-U.S.
Holder, backup withholding and
information reporting will not apply to payments made if the
Non-U.S.
Holder provides the required certification that it is not a U.S. person, or the
Non-U.S.
Holder
otherwise establishes an exemption, provided that the payor or withholding agent does not have actual knowledge or reason to know that the holder is a U.S. person, or that the conditions of any exemption are not satisfied. However, we and other
payors are required to report payments of interest on the debt securities on IRS Form
1042-S
even if the payments are not otherwise subject to information reporting requirements.
Any amounts withheld under the backup withholding rules will be allowed as a refund or a credit against a holder’s U.S. federal income
tax liability provided the required information is furnished to the IRS.
Taxation of Common Stock, Preferred Stock, and
Depositary Shares
This section describes the material U.S. federal income tax consequences of the acquisition, ownership and
disposition of the common stock, preferred stock and depositary shares offered in this prospectus.
Taxation of Holders of
Depositary Shares
For U.S. federal income tax purposes, holders of depositary shares generally will be treated as if they were
the holders of the preferred stock represented by such depositary shares. Accordingly, such holders will be entitled to take into account, for U.S. federal income tax purposes, income, and deductions to which they would be entitled if they were
holders of such preferred stock, as described more fully below. Exchanges of preferred stock for depositary shares and depositary shares for preferred stock generally will not be subject to U.S. federal income taxation.
Consequences to U.S. Holders
The following is a summary of the material U.S. federal income tax consequences that will apply to U.S. Holders of our common stock, preferred
stock, and depositary shares.
Distributions on Common Stock, Preferred Stock, and Depositary Shares.
Distributions made to U.S.
Holders out of our current or accumulated earnings and profits, as determined for U.S. federal income tax purposes, will be included in the income of a U.S. Holder as dividend income and will be subject to tax as ordinary income. Dividends received
by a
non-corporate
U.S. Holder that
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constitute “qualified dividend income” are generally subject to tax at a maximum rate applicable to net long-term capital gains, provided that certain holding period and other
requirements are met. Dividends received by a corporate U.S. Holder, except as described in the next section, generally will be eligible for the 50% dividends-received deduction.
Distributions in excess of our current and accumulated earnings and profits will not be taxable to a U.S. Holder to the extent that the
distributions do not exceed the U.S. Holder’s adjusted tax basis in the shares, but rather will reduce the adjusted tax basis of such shares. To the extent that distributions in excess of our current and accumulated earnings and profits exceed
the U.S. Holder’s adjusted tax basis in the shares, such distributions will be treated as gain from the disposition of our common stock, preferred stock or depositary shares. In addition, a corporate U.S. Holder will not be entitled to the
dividends- received deduction on this portion of a distribution.
Limitations on Dividends-Received Deduction.
A corporate U.S.
Holder may not be entitled to take the 50% dividends-received deduction in all circumstances. Prospective corporate investors in our common stock, preferred stock, or depositary shares should consider the effect of:
•
Section 246A of the Code, which reduces the dividends-received deduction allowed to a corporate U.S. Holder
that has incurred indebtedness that is “directly attributable” to an investment in portfolio stock, which may include our common stock, preferred stock, and depositary shares;
•
Section 246(c) of the Code, which, among other things, disallows the dividends-received deduction in respect
of any dividend on a share of stock that is held for less than the minimum holding period (generally, for common stock, at least 46 days during the
91-day
period beginning on the date which is 45 days before
the date on which such share becomes
ex-dividend
with respect to such dividend); and
•
Section 1059 of the Code, which, under certain circumstances, reduces the basis of stock for purposes of
calculating gain or loss in a subsequent disposition by the portion of any “extraordinary dividend” (as defined below) that is eligible for the dividends-received deduction.
Extraordinary Dividends
. A corporate U.S. Holder will be required to reduce its tax basis (but not below zero) in our common stock,
preferred stock, or depositary shares by the nontaxed portion of any “extraordinary dividend” if the stock was not held for more than two years before the earliest of the date such dividend is declared, announced, or agreed. Generally,
the nontaxed portion of an extraordinary dividend is the amount excluded from income by operation of the dividends-received deduction. An extraordinary dividend generally would be a dividend that:
•
in the case of common stock, equals or exceeds 10% of the corporate U.S. Holder’s adjusted tax basis in the
common stock, treating all dividends having
ex-dividend
dates within an
85-day
period as one dividend; or
•
in the case of preferred stock, equals or exceeds 5% of the corporate U.S. Holder’s adjusted tax basis in
the preferred stock, treating all dividends having
ex-dividend
dates within an
85-day
period as one dividend; or
•
exceeds 20% of the corporate U.S. Holder’s adjusted tax basis in the stock, treating all dividends having
ex-dividend
dates within a
365-day
period as one dividend.
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In determining whether a dividend paid on stock is an extraordinary dividend, a corporate
U.S. Holder may elect to substitute the fair market value of the stock for its tax basis for purposes of applying these tests if the fair market value as of the day before the
ex-dividend
date is established
to the satisfaction of the Secretary of the Treasury. An extraordinary dividend also includes any amount treated as a dividend in the case of a redemption that is either
non-pro
rata as to all stockholders or
in partial liquidation of the corporation, regardless of the stockholder’s holding period and regardless of the size of the dividend. Any part of the nontaxed portion of an extraordinary dividend that is not applied to reduce the corporate
U.S. Holder’s tax basis as a result of the limitation on reducing its basis below zero would be treated as gain from the disposition of such stock and would be recognized in the taxable year in which the extraordinary dividend is received. A
non-corporate
U.S. Holder that receives any extraordinary dividends will be required to treat any losses on a taxable disposition of our common stock, preferred stock, or depositary shares as long-term capital
losses to the extent that such extraordinary dividends qualify for taxation at special rates as qualified dividend income.
U.S.
Holders should consult with their own tax advisors with respect to the possible application of the extraordinary dividend provisions of the Code to the ownership or disposition of common stock, preferred stock, or depositary shares in their
particular circumstances.
Sale, Exchange, or other Taxable Disposition.
Upon a taxable disposition of our common stock,
preferred stock, or depositary shares (other than by redemption or repurchase by us), a U.S. Holder generally will recognize gain or loss equal to the difference between the amount realized upon the taxable disposition and the U.S. Holder’s
adjusted tax basis in the shares. The amount realized by the U.S. Holder will include the amount of any cash and the fair market value of any other property received upon the taxable disposition of the shares. A U.S. Holder’s tax basis in a
share generally will be equal to the cost of the share to such U.S. Holder, which may be adjusted for certain subsequent events (for example, if the U.S. Holder receives a
non-dividend
distribution, as
described above). Gain or loss realized upon a taxable disposition of our common stock, preferred stock, or depositary shares generally will be capital gain or loss and will be long-term capital gain or loss if the shares have been held for more
than one year. Net long-term capital gain recognized by an individual U.S. Holder is generally taxed at preferential rates. The ability of U.S. Holders to deduct capital losses is subject to limitations under the Code. If the U.S. Holder recognizes
a loss above certain thresholds, the U.S. Holder may be required to file a Form 8886 with the IRS, as discussed under “Reportable Transactions” below.
Redemption or Repurchase of Common Stock, Preferred Stock, or Depositary Shares
. If we are permitted to and redeem or repurchase a U.S.
Holder’s common stock, preferred stock, or depositary shares, the redemption or repurchase generally would be a taxable event for U.S. federal income tax purposes. A U.S. Holder would be treated as if it had sold its shares if the redemption
or repurchase:
•
results in a complete termination of the U.S. Holder’s stock interest in us;
•
is substantially disproportionate with respect to the U.S. Holder, in the case of voting shares; or
•
is not essentially equivalent to a dividend with respect to the U.S. Holder, in each case as determined under the
Code and applicable treasury regulations.
In determining whether any of these tests has been met, shares of stock
considered to be owned by a U.S. Holder by reason of certain constructive ownership rules set forth in Section 318 of the Code, as well as shares actually owned, must be taken into account.
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If we redeem or repurchase a U.S. Holder’s shares in a redemption or repurchase that
meets one of the tests described above, the U.S. Holder generally would recognize taxable gain or loss equal to the sum of the amount of cash and fair market value of property (other than our stock or the stock of a successor to us) received less
the U.S. Holder’s tax basis in the shares redeemed or repurchased. This gain or loss generally would be long-term capital gain or capital loss if the shares have been held for more than one year.
If a redemption or repurchase does not meet any of the tests described above, a U.S. Holder generally will be taxed on the cash and fair
market value of the property received as a dividend to the extent paid out of our current and accumulated earnings and profits. Any amount in excess of our current and accumulated earnings and profits would first reduce the U.S. Holder’s tax
basis in the shares and thereafter would be treated as capital gain. If a redemption or repurchase is treated as a distribution that is taxable as a dividend, the U.S. Holder’s tax basis in the redeemed or repurchased shares would be
transferred to the remaining shares of our stock that the U.S. Holder owns, if any.
Special rules apply if we exchange our common stock,
preferred stock, or depositary shares for our debt securities. We will discuss any special U.S. federal income tax considerations in the applicable supplement if we have the option to redeem our common stock, preferred stock, or depositary shares
for our debt securities.
Consequences to
Non-U.S.
Holders
The following is a summary of the material U.S. federal income tax consequences that will apply to
Non-U.S.
Holders of our common stock, preferred stock, and depositary shares.
Distributions on
Common Stock, Preferred Stock, and Depositary Shares.
Distributions made to
Non-U.S.
Holders out of our current or accumulated earnings and profits, as determined for U.S. federal income tax purposes, and
that are not effectively connected with the conduct by the
Non-U.S.
Holder of a trade or business within the United States, or a permanent establishment maintained in the United States if certain tax treaties
apply, generally will be subject to U.S. federal income and withholding tax at a rate of 30% (or lower rate under an applicable treaty, if any). Subject to the discussions below concerning backup withholding and FATCA, payments subject to
withholding of U.S. federal income tax may nevertheless be exempt from withholding (or subject to withholding at a reduced rate) if the
Non-U.S.
Holder provides us with a properly executed IRS Form
W-8BEN
or
W-8BEN-E
(or successor form) claiming an exemption from, or reduction in, withholding under the benefit of a tax treaty, or
IRS Form
W-8ECI
(or other applicable form) stating that a dividend paid on our shares is not subject to withholding tax because it is effectively connected with the conduct of a trade or business within the
United States, as discussed below.
To claim benefits under an income tax treaty, a
Non-U.S.
Holder must certify to us or the applicable withholding agent, under penalties of perjury, that it is a
non-U.S.
person and provide its name and address (which certification may generally be made on an IRS
Form
W-8BEN
or
W-8BEN-E,
or a successor form), obtain and provide a taxpayer identification number, and certify as to its
eligibility under the appropriate treaty’s limitations on benefits article. In addition, special rules may apply to claims for treaty benefits made by
Non-U.S.
Holders that are entities rather than
individuals. A
Non-U.S.
Holder that is eligible for a reduced rate of U.S. federal withholding tax under an income tax treaty may obtain a refund of any excess amounts withheld by filing an appropriate claim
for refund with the IRS.
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Sale, Exchange, or other Taxable Disposition.
Subject to the discussions below
concerning backup withholding and FATCA, a
Non-U.S.
Holder generally will not be subject to U.S. federal income or withholding tax on any capital gain realized upon a taxable disposition of our common stock,
preferred stock, or depositary shares, provided that: (a) the gain is not effectively connected with the conduct of a trade or business within the United States, or a permanent establishment maintained in the United States if certain tax
treaties apply, (b) in the case of a
Non-U.S.
Holder that is an individual, the
Non-U.S.
Holder is not present in the United States for 183 days or more in the
taxable year of the taxable disposition of the shares, (c) the
Non-U.S.
Holder is not subject to tax pursuant to certain provisions of U.S. federal income tax law applicable to certain expatriates, and
(d) we are not nor have we been a “United States real property holding corporation” for U.S. federal income tax purposes. An individual
Non-U.S.
Holder who is present in the United States for
183 days or more in the taxable year of the taxable disposition of our common stock, preferred stock, or depositary shares, provided that certain other conditions are met, will be subject to U.S. federal income tax at a rate of 30% on the gains
realized upon the taxable disposition of such shares.
We believe that we are not currently, and do not anticipate becoming, a
“United States real property holding corporation” for U.S. federal income tax purposes.
Income Effectively Connected with
a Trade or Business within the United States
. If a
Non-U.S.
Holder of our common stock, preferred stock, or depositary shares is engaged in the conduct of a trade or business within the United States and
if dividends on the shares, or gain realized upon a taxable disposition of the shares, are effectively connected with the conduct of such trade or business (and, if certain tax treaties apply, are attributable to a permanent establishment maintained
by the
Non-U.S.
Holder in the United States), the
Non-U.S.
Holder, although exempt from U.S. federal withholding tax (provided that the certification requirements
discussed above are satisfied), generally will be subject to U.S. federal income tax on such dividends or gain on a net income basis in the same manner as if it were a U.S. Holder.
Non-U.S.
Holders should read
the material under the heading “—Consequences to U.S. Holders” above for a description of the U.S. federal income tax consequences of acquiring, owning, and disposing of our common stock, preferred stock, or depositary shares. In
addition, if such
Non-U.S.
Holder is a foreign corporation, it may also be subject to a branch profits tax equal to 30% (or lower rate under an applicable treaty, if any) of a portion of its earnings and
profits for the taxable year that are effectively connected with its conduct of a trade or business in the United States, subject to certain adjustments.
Backup Withholding and Information Reporting
In general, in the case of a U.S. Holder, other than certain exempt holders, we and other payors are required to report to the IRS all
payments of dividends on our common stock, preferred stock, or depositary shares. In addition, we and other payors generally are required to report to the IRS any payment of proceeds of the sale of common stock, preferred stock, or depositary
shares. Additionally, backup withholding generally will apply to any dividend payment and to proceeds received upon a taxable disposition if a U.S. Holder fails to provide an accurate taxpayer identification number and certify that the taxpayer
identification number is correct, the U.S. Holder is notified by the IRS that it has failed to report all dividends required to be shown on its U.S. federal income tax returns, or the U.S. Holder does not certify that it has not underreported its
interest and dividend income.
In the case of a
Non-U.S.
Holder, backup withholding and
information reporting will not apply to payments made if the
Non-U.S.
Holder provides the required certification that it is not a U.S. person, as described above, or the
Non-U.S.
Holder otherwise establishes an exemption, provided that the payor or withholding agent does not have actual knowledge or reason to know that the holder is a U.S. person, or that the conditions of any
exemption are not satisfied.
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Any amounts withheld under the backup withholding rules will be allowed as a refund or a
credit against a holder’s U.S. federal income tax liability provided the required information is furnished to the IRS.
Convertible Preferred Stock and Other Equity Securities
Special U.S. federal income tax rules are applicable to certain other of our equity securities, including preferred stock convertible into or
exercisable or exchangeable for our common stock or other securities. The material U.S. federal income tax considerations with respect to these securities will be discussed in the applicable supplement. Investors should consult with their own tax
advisors regarding the specific U.S. federal income tax considerations with respect to these securities.
Taxation of
Warrants
The applicable supplement will contain a discussion of any special U.S. federal income tax considerations with respect to
the acquisition, ownership and disposition of warrants offered in this prospectus, including any tax considerations relating to the specific terms of the warrants. Investors considering the purchase of warrants we are offering should carefully
examine the applicable supplement regarding the special U.S. federal income tax considerations, if any, of the acquisition, ownership and disposition of the warrants.
Investors should consult with their own tax advisors regarding the U.S. federal income tax consequences and the tax consequences of any
other taxing jurisdiction relating to the ownership and disposition of warrants we are offering in light of their investment or tax circumstances.
Taxation of Purchase Contracts
The applicable supplement will contain a discussion of any special U.S. federal income tax considerations with respect to the acquisition,
ownership and disposition of purchase contracts offered in this prospectus, including any tax considerations relating to the specific terms of the purchase contracts. Investors considering the purchase of purchase contracts we are offering should
carefully examine the applicable supplement regarding the special U.S. federal income tax considerations, if any, of the acquisition, ownership and disposition of the purchase contracts.
Investors should consult with their own tax advisors regarding the U.S. federal income tax consequences and the tax consequences of any
other taxing jurisdiction relating to the ownership and disposition of the purchase contracts in light of their investment or tax circumstances.
Taxation of Units
The applicable supplement will contain a discussion of any special U.S. federal income tax considerations with
respect to the acquisition, ownership and disposition of units that we are offering, including any tax considerations relating to the specific terms of the units. Investors considering the purchase of units that we are offering should carefully
examine the applicable supplement regarding the special U.S. federal income tax consequences, if any, of the acquisition, ownership and disposition of the units.
Investors should consult with their own tax advisors regarding the U.S. federal income tax consequences and the tax consequences of any
other taxing jurisdiction relating to the ownership and disposition of units comprised of one or more of the securities we are offering in light of their investment or tax circumstances.
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Reportable Transactions
Applicable Treasury regulations require taxpayers that participate in “reportable transactions” to disclose their participation to
the IRS by attaching Form 8886 to their U.S. federal tax returns and to retain a copy of all documents and records related to the transaction. In addition, “material advisors” with respect to such a transaction may be required to file
returns and maintain records, including lists identifying investors in the transactions, and to furnish those records to the IRS upon demand. A transaction may be a “reportable transaction” based on any of several criteria, one or more
of which may be present with respect to an investment in the securities that we are offering. Whether an investment in these securities constitutes a “reportable transaction” for any investor may depend on the investor’s particular
circumstances. The Treasury regulations provide that, in addition to certain other transactions, a “loss transaction” constitutes a “reportable transaction.” A “loss transaction” is any transaction resulting in
the taxpayer claiming a loss under Section 165 of the Code, in an amount equal to or in excess of certain threshold amounts, subject to certain exceptions. The Treasury regulations specifically provide that a loss resulting from a
“Section 988 transaction” will constitute a Section 165 loss, and certain exceptions will not be available if the loss from a taxable disposition is treated as ordinary under Section 988. In general, certain securities
issued in a foreign currency will be subject to the rules governing foreign currency exchange gain or loss. Therefore, losses realized with respect to such a security may constitute a Section 988 transaction, and a holder of such a security
that recognizes exchange loss in an amount that exceeds the loss threshold amount applicable to that holder may be required to file Form 8886. Investors should consult their own tax advisors concerning any possible disclosure obligation they may
have with respect to their investment in the securities that we are offering and should be aware that, should any “material advisor” determine that the return filing or investor list maintenance requirements apply to such a transaction,
they would be required to comply with these requirements.
Foreign Account Tax Compliance Act
Legislation commonly known as “FATCA” (sections 1471 through 1474 of the Code) imposes a 30% U.S. withholding tax on certain
U.S.-source payments, including interest (and OID), dividends, other fixed or determinable annual or periodical gain, profits, and income, and on the gross proceeds from a disposition of property of a type which can produce U.S.-source interest or
dividends (“Withholdable Payments”), if paid to a foreign financial institution (including amounts paid to a foreign financial institution on behalf of a holder), unless such institution enters into an agreement with the Treasury to
collect and provide to the Treasury certain information regarding U.S. financial account holders, including certain account holders that are foreign entities with U.S. owners, with such institution or otherwise complies with FATCA. FATCA also
generally imposes a withholding tax of 30% on Withholdable Payments made to a
non-financial
foreign entity unless such entity provides the withholding agent with a certification that it does not have any
substantial U.S. owners or a certification identifying the direct and indirect substantial U.S. owners of the entity. Under certain circumstances, a holder may be eligible for refunds or credits of such taxes.
These withholding and reporting requirements generally apply to U.S.-source periodic payments and to payments of gross proceeds from a sale or
redemption. However, under proposed Treasury regulations (the preamble to which specifies that taxpayers are permitted to rely on them pending finalization), no withholding under FATCA will apply to payments of gross proceeds from a sale or
redemption (other than income treated as U.S.-source “fixed or determinable annual or periodical” income). If we (or an applicable withholding agent) determine withholding under FATCA is appropriate, we (or such agent) will withhold tax
at the applicable statutory rate, without being required to pay any additional amounts in respect of such withholding. Foreign financial institutions and
non-financial
foreign entities located in jurisdictions
that have an intergovernmental agreement with the United States governing FATCA may be subject to different
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rules. Holders are urged to consult with their own tax advisors regarding the possible implications of FATCA on their investment in the debt securities, preferred stock, depositary shares, or
common stock.
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PLAN OF DISTRIBUTION (CONFLICTS OF INTEREST)
We may sell the securities offered using this prospectus:
•
through underwriters;
•
through dealers;
•
through agents; or
•
directly to purchasers.
In addition, we may issue the securities as a dividend or distribution or in a subscription rights offering to our existing security holders.
The underwriters, dealers, or agents may include BofA Securities, Inc. (“BofAS”), or any of our other broker-dealer
affiliates.
Each supplement relating to an offering of securities will state the terms of the offering, including:
•
the names of any underwriters, dealers, or agents;
•
the public offering or purchase price of the offered securities and the net proceeds that we will receive from
the sale;
•
any underwriting discounts and commissions or other items constituting underwriters’ compensation;
•
any discounts, commissions, or fees allowed or paid to dealers or agents; and
•
any securities exchange on which the offered securities may be listed.
Distribution Through Underwriters
We may offer and sell securities from time to time to one or more underwriters who would purchase the securities as principal for resale to
the public, either on a firm commitment or best efforts basis. If we sell securities to underwriters, we will execute an underwriting agreement with them at the time of the sale and will name them in the applicable supplement. In connection with
these sales, the underwriters may be deemed to have received compensation from us in the form of underwriting discounts and commissions. The underwriters also may receive commissions from purchasers of securities for whom they may act as agent.
Unless we specify otherwise in the applicable supplement, the underwriters will not be obligated to purchase the securities unless the conditions set forth in the underwriting agreement are satisfied, and if the underwriters purchase any of the
securities, they will be required to purchase all of the offered securities. The underwriters may acquire the securities for their own account and may resell the securities from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or varying prices determined at the time of sale. The underwriters may sell the offered securities to or through dealers, and those dealers may receive discounts, concessions, or commissions from the
underwriters as well as from the purchasers for whom they may act as agent. Any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time.
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Distribution Through Dealers
We may offer and sell securities from time to time to one or more dealers who would purchase the securities as principal. The dealers then may
resell the offered securities to the public at fixed or varying prices to be determined by those dealers at the time of resale. We will set forth the names of the dealers and the terms of the transaction in the applicable supplement.
Distribution Through Agents
We may offer and sell securities on a continuous basis through agents that become parties to an underwriting or distribution agreement. We
will name any agent involved in the offer and sale, and describe any commissions payable by us in the applicable supplement. Unless we specify otherwise in the applicable supplement, the agent will be acting on a best efforts basis during the
appointment period.
Direct Sales
We may sell directly to, and solicit offers from, institutional investors or others who may be deemed to be underwriters, as defined in the
Securities Act, for any resale of the securities. We will describe the terms of any sales of this kind in the applicable supplement.
General Information
Underwriters, dealers, or agents participating in an offering of securities may be deemed to be underwriters,
and any discounts and commissions received by them and any profit realized by them on resale of the offered securities for whom they act as agent, may be deemed to be underwriting discounts and commissions under the Securities Act.
We may offer to sell securities either at a fixed price or at prices that may vary, at market prices prevailing at the time of sale, at prices
related to prevailing market prices, or at negotiated prices. Securities may be sold in connection with a remarketing after their purchase by one or more firms including our affiliates, acting as principal for their own accounts or as our agent.
In connection with an underwritten offering of the securities, the underwriters may engage in overallotment, stabilizing transactions and
syndicate covering transactions in accordance with Regulation M under the Exchange Act. Overallotment involves sales in excess of the offering size, which creates a short position for the underwriters. The underwriters may enter bids for, and
purchase, securities in the open market in order to stabilize the price of the securities. Syndicate covering transactions involve purchases of the securities in the open market after the distribution has been completed in order to cover short
positions. In addition, the underwriting syndicate may reclaim selling concessions allowed to an underwriter or a dealer for distributing the securities in the offering if the syndicate repurchases previously distributed securities in transactions
to cover syndicate short positions, in stabilization transactions, or otherwise. These activities may cause the price of the securities to be higher than it would otherwise be. Those activities, if commenced, may be discontinued at any time.
Ordinarily, each issue of securities will be a new issue, and there will be no established trading market for any security other than our
common stock prior to its original issue date. We may not list any particular series of securities on a securities exchange or quotation system. Any underwriters to whom or agents through whom the offered securities are sold for offering and sale
may make a market in the offered securities. However, any underwriters or agents that make a market will not be obligated to do so and may stop doing so at any time without notice. We cannot assure you that there will be a liquid trading market for
the offered securities.
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If we offer securities in a subscription rights offering to our existing security holders,
we may enter into a standby underwriting agreement with dealers, acting as standby underwriters. We may pay the standby underwriters a commitment fee for the securities they commit to purchase on a standby basis. If we do not enter into a standby
underwriting arrangement, we may retain a dealer-manager to manage a subscription rights offering for us.
Under agreements entered into
with us, underwriters and agents may be entitled to indemnification by us against certain civil liabilities, including liabilities under the Securities Act, or to contribution for payments the underwriters or agents may be required to make.
Delivery of the securities will be made against payment therefor on or about the issue date specified in the applicable pricing supplement.
Under Rule
15c6-1
of the Exchange Act trades in the secondary market generally are required to settle in two business days after the date the securities are priced, unless the parties to any such trade
expressly agree otherwise. Effective on May 28, 2024 (the “settlement cycle effective date”), the standard settlement cycle under Rule
15c6-1
will be shortened from two business days to one
business day. Accordingly, if the applicable pricing supplement specifies that the issue date is more than two business days (or, on or after the settlement cycle effective date, one business day) after the date on which the securities are priced,
purchasers who wish to trade such securities at any time prior to the second business day (or, on or after the settlement cycle effective date, the first business day) preceding the issue date will be required, by virtue of the fact that the
securities will not settle in T+2 (or, on or after the settlement cycle effective date, T+1), to specify an alternative settlement cycle at the time of any such trade to prevent a failed settlement; such purchasers should also consult their own
advisors in this regard.
Market-Making Transactions by Affiliates
Following the initial distribution of securities, our broker-dealer affiliates, including BofAS, may buy and sell the securities in secondary
market transactions as part of their business as broker-dealers. Resales of this kind may occur in the open market or may be privately negotiated, at prevailing market prices at the time of resale or at related or negotiated prices. This prospectus
and any related supplements may be used by one or more of our affiliates in connection with these market-making transactions to the extent permitted by applicable law. Our affiliates may act as principal or agent in these transactions.
The aggregate initial offering price specified on the cover of the applicable supplement will relate to the initial offering of securities not
yet issued as of the date of this prospectus. This amount does not include any securities to be sold in market-making transactions. The securities to be sold in market-making transactions include securities issued after the date of this prospectus.
Information about the trade and settlement dates, as well as the purchase price, for a market-making transaction will be provided to the
purchaser in a separate confirmation of sale.
Unless we or our agent informs you in your confirmation of sale that the security is
being purchased in its original offering and sale, you may assume that you are purchasing the security in a market-making transaction.
Conflicts of Interest
BofAS is our wholly-owned subsidiary, and unless otherwise set forth in the applicable supplement, we will
receive the net proceeds of any offering in which BofAS participates as an underwriter, dealer or agent. The offer and sale of any securities by BofAS, or any of our other
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broker-dealer affiliates that is a member of the Financial Industry Regulatory Authority, Inc., or “FINRA,” will comply with the requirements of FINRA Rule 5121 regarding a FINRA
member firm’s offer and sale of securities of an affiliate. As required by FINRA Rule 5121, any such offer and sale will not be made to any discretionary account without the prior approval of the customer.
The maximum commission or discount to be received by any FINRA member or independent broker-dealer will not be greater than 8% of the initial
gross proceeds from the sale of any security being sold.
The underwriters, agents and their affiliates may engage in financial or other
business transactions with us and our subsidiaries in the ordinary course of business.
In addition, in the ordinary course of their
business activities, one or more of the underwriters, dealers or agents and/or their respective affiliates, may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial
instruments (including bank loans) for their own account and for the accounts of their customers. These investments and securities activities may involve securities and/or instruments of ours or our affiliates. These underwriters, dealers or agents,
or their affiliates, that have a lending relationship with us routinely hedge their credit exposure to us consistent with their customary risk management policies. Typically, these parties would hedge such exposure to us by entering into
transactions which consist of either the purchase of credit default swaps or the creation of short positions in our securities, including potentially the securities offered hereby. Any such short positions could adversely affect future trading
prices of the securities offered hereby. These broker-dealers or their affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or financial instruments and may hold, or
recommend to clients that they acquire, long and/or short positions in such securities and instruments.
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ERISA CONSIDERATIONS
A fiduciary of a pension, profit-sharing or other employee benefit plan subject to the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), should consider the fiduciary standards of ERISA in the context of the ERISA plan’s particular circumstances before authorizing an investment in the offered securities of Bank of America. Among other factors, the
fiduciary should consider whether such an investment is in accordance with the documents governing the ERISA plan and whether the investment is appropriate for the ERISA plan in view of its overall investment policy and diversification of its
portfolio. A fiduciary should also consider whether an investment in the offered securities may constitute a “prohibited transaction,” as described below.
Certain provisions of ERISA and the Code, prohibit employee benefit plans (as defined in Section 3(3) of ERISA) that are subject to
Title I of ERISA, plans described in Section 4975(e)(1) of the Code (including, without limitation, individual retirement accounts and retirement plans covering self-employed persons) that are subject to Section 4975 of the Code, and
entities whose underlying assets include plan assets by reason of such employee benefit plan’s or plan’s investment in such entities (including, without limitation, as applicable, insurance company general accounts) (each, a
“Plan” and collectively, “Plans”) from engaging in certain transactions involving “plan assets” with persons that are “parties in interest” under ERISA or “disqualified persons” under the
Code with respect to the Plan (referred to as “prohibited transactions”).
Because of its businesses, each of Bank of America
Corporation and certain of its affiliates may be considered a “party in interest” or a “disqualified person” with respect to many Plans on account of being a service provider to such Plans. As a result, a prohibited
transaction may arise if the securities are acquired or held by or on behalf of a Plan unless those securities are acquired and held pursuant to an available exemption.
The U.S. Department of Labor has issued five prohibited transaction class exemptions (“PTCEs”) that may provide exemptive relief
for direct or indirect prohibited transactions resulting from or occurring in connection with the purchase or holding of these securities by or on behalf of a Plan. Those class exemptions are
PTCE 96-23
(for certain transactions determined by
in-house
asset managers),
PTCE 95-60
(for certain transactions involving insurance company general accounts),
PTCE 91-38
(for certain transactions involving bank collective investment funds),
PTCE 90-1
(for certain transactions involving insurance company separate accounts)
and
PTCE 84-14
(for certain transactions determined by independent qualified professional asset managers). In addition, ERISA Section 408(b)(17) and Section 4975(d)(20) of the Code provide an
exemption for the purchase and sale of securities and related lending transactions, provided that neither the issuer of the securities nor any of its affiliates has or exercises any discretionary authority or control or renders any investment advice
with respect to the assets of any plan involved in the transaction and provided further that the plan receives no less, nor pays no more, than adequate consideration in connection with the transaction (the
so-called
“Service Provider Exemption”). There can be no assurance that any of these class or statutory exemptions or any other exemption will be available with respect to transactions involving
these securities.
Governmental plans,
non-U.S.
plans and certain church plans (collectively,
“Non-ERISA
Arrangements”), while not subject to Title I of ERISA or Section 4975 of the Code, may be subject to similar restrictions under state, federal, local or
non-U.S.
laws or regulations (“Similar Laws”).
Accordingly, unless otherwise provided
in connection with a particular offering of securities, the offered securities may not be purchased, held or disposed of by any Plan or
Non-ERISA
Arrangement or any other person investing “plan
assets” of any Plan or
Non-ERISA
Arrangement, unless one of the following exemptions (or a similar exemption or exception acceptable to us) applies to such purchase, holding, and disposition: the Service
Provider Exemption,
PTCE 96-23,
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PTCE 95-60,
PTCE 91-38,
PTCE 90-1,
or
PTCE 84-14.
Therefore, unless otherwise provided in connection with a particular offering of securities, any purchaser of the offered securities or any interest therein will be deemed to have represented and
warranted to us on each day including the date of its purchase of the offered securities through and including the date of disposition of such offered securities that:
(a)
it is not a Plan or
Non-ERISA
Arrangement and is not purchasing such
securities or interest therein on behalf of, or with “plan assets” of, any Plan or
Non-ERISA
Arrangement;
(b)
if it is a Plan or is purchasing such securities or interest therein on behalf of, or with “plan
assets” of, a Plan, its purchase, holding, and disposition of such securities will not constitute or result in a
non-exempt
prohibited transaction under ERISA or the Code; or
(c)
if it is a
Non-ERISA
Arrangement or is purchasing such securities or
interest therein on behalf of, or with “plan assets” of, a
Non-ERISA
Arrangement, its purchase, holding, and disposition of such securities will not violate any Similar Law and are not otherwise
prohibited.
Moreover, any purchaser that is a Plan or is acquiring the offered securities on behalf of a Plan,
including any fiduciary purchasing on behalf of a Plan, will be deemed to have represented, in its corporate and its fiduciary capacity, by its purchase and holding of the offered securities that (a) neither we, any of the underwriters nor any
of our or their respective affiliates (collectively, the “Sellers”) is a “fiduciary” (under Section 3(21) of ERISA, or under any final or proposed regulations thereunder, or with respect to a
Non-ERISA
Arrangement, under any Similar Laws) with respect to the acquisition, holding or disposition of the offered securities, or as a result of any exercise by any Seller of any rights in connection with the
offered securities, (b) no advice provided by any Seller has formed a primary basis for any investment decision by or on behalf of such purchaser in connection with the offered securities and the transactions contemplated with respect to the
securities, and (c) such purchaser recognizes and agrees that any communication from the Sellers to the purchaser with respect to the offered securities is not intended by the Sellers to be impartial investment advice and is rendered in its
capacity as a seller of such offered securities and not as a fiduciary to such purchaser, in each case, in connection with the initial offering of the Securities.
This discussion is a general summary of some of the rules which apply to Plan or
Non-ERISA
Arrangement and their related investment vehicles as of the date of this prospectus. The rules governing investments by Plan or
Non-ERISA
Arrangement change frequently, and we have no duty to, nor will we,
inform you about any changes to such rules if and when they occur. This summary does not describe all of the rules or other considerations that may be relevant to the investment in the offered securities by such plans or arrangements. The
description above is not, and should not be construed as, legal advice or a legal opinion.
Due to the complexity of these rules
and the penalties imposed upon persons involved
in prohibited transactions, it is important that any person considering the purchase
of the offered securities with plan assets consult with its counsel regarding the
consequences
under ERISA and the Code, or any Similar Law, of the acquisition and
holding of offered securities and the availability of exemptive relief under the
class or statutory exemptions listed above or under any other exemption. The sale of
the securities of Bank of America to a
Plan or
Non-ERISA
Arrangement is in no respect a representation by any Seller that
such an investment meets all relevant legal requirements with respect to
investments
by Plans or
Non-ERISA
Arrangements generally or any particular Plan or
Non-ERISA
Arrangement, or that such an investment is appropriate
for
Plans or
Non-ERISA
Arrangements generally or any particular Plan or
Non-ERISA
Arrangements
.
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WHERE YOU CAN FIND MORE INFORMATION
We have filed a registration statement on Form
S-3
with the SEC covering the securities to be offered
and sold using this prospectus. You should refer to this registration statement and its exhibits for additional information about us. This prospectus summarizes material provisions of certain contracts and other documents and may not contain all of
the information that you may find important. You should review the full text of these contracts and other documents, which we have included as exhibits to the registration statement.
We file annual, quarterly, and special reports, proxy statements and other information with the SEC. You may inspect our filings over the
Internet at the SEC’s website, www.sec.gov. The reports and other information we file with the SEC also are available at our website, www.bankofamerica.com. We have included the SEC’s web address and our web address as inactive textual
references only. Except as specifically incorporated by reference into this prospectus, information on those websites is not part of this prospectus.
The SEC allows us to incorporate by reference the information we file with it. This means that:
•
incorporated documents are considered part of this prospectus;
•
we can disclose important information to you by referring you to those documents; and
•
information that we file with the SEC automatically will update and supersede this incorporated information and
information in this prospectus.
We incorporate by reference the documents listed below which were filed with the SEC
under the Exchange Act:
•
our annual report on
Form 10-K
for the year ended December
31, 2023, including information specifically incorporated into our Form 10-K from our
definitive proxy statement relating
to our 2024 annual meeting of shareholders;
•
our current reports on Form
8-K
filed
January 8,
2024
,
January
12, 2024
and
February 2, 2024
(in each case, other than documents or information that is furnished but deemed
not to have been filed); and
•
the description of our common stock which is contained in
Exhibit
4.30
of our annual report on Form
10-K
for the year ended December 31, 2023 and any other amendment or report filed for the purpose of updating such description.
We also incorporate by reference reports that we will file under Sections 13(a), 13(c), 14, and 15(d) of the Exchange Act during the
period after the filing of the initial registration statement and prior to the effectiveness of the registration statement and after the date of this prospectus until the termination of the offering of securities covered by this prospectus, but not
any information that we may furnish but that is not deemed to be filed.
You should assume that the information appearing in this
prospectus is accurate only as of the date of this prospectus. Our business, financial position, and results of operations may have changed since that date.
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We will provide to you, without charge, upon your oral or written request a copy of any
filings referred to above. You may request such copies by contacting us at the following address or telephone number:
Bank of America
Corporation
Fixed Income Investor Relations
100 North Tryon Street
Charlotte,
North Carolina 28255-0065
1-866-607-1234
FORWARD-LOOKING STATEMENTS
Certain statements included or incorporated by reference in this prospectus and the applicable supplements constitute “forward-looking
statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. You may find these statements by looking for words such as “plan,” “believe,” “expect,”
“intend,” “anticipate,” “estimate,” “project,” “potential,” “possible,” or other similar expressions, or future or conditional verbs such as “will,”
“should,” “would,” and “could.”
All forward-looking statements, by their nature, are subject to risks
and uncertainties. Our actual results may differ materially from those set forth in our forward-looking statements. As a large, international financial services company, we face risks that are inherent in the businesses and market places in which we
operate. Information regarding important factors that could cause our future financial performance to vary from that described in our forward-looking statements is contained in our annual report on
Form 10-K
for the year ended December 31, 2023, which is incorporated by reference in this prospectus, under the captions “Item 1A. Risk Factors” and “Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and in our subsequent filings that are incorporated in this prospectus by reference. See “Where You Can Find More Information” above for
information about how to obtain a copy of our annual report.
You should not place undue reliance on any forward-looking statements, which
speak only as of the dates they are made.
All subsequent written and oral forward-looking statements attributable to us or any person on
our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Except to the extent required by applicable law or regulation, we undertake no obligation to update these forward-looking
statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events.
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LEGAL MATTERS
The legality of the securities being registered will be passed upon for us by McGuireWoods LLP, Charlotte, North Carolina, and for the
underwriters or agents by Davis Polk & Wardwell LLP, New York, New York or such other counsel as may be indicated in the applicable supplement. Certain U.S. federal income tax matters will be passed upon for Bank of America by Davis
Polk & Wardwell, LLP, New York, New York, special tax counsel to Bank of America. McGuireWoods LLP regularly performs legal services for us.
EXPERTS
The financial statements and management’s assessment of the effectiveness of internal control over financial reporting (which is
included in Management’s Report on Internal Control over Financial Reporting) incorporated in this prospectus by reference to our Annual Report on Form
10-K
for the year ended December 31, 2023 have
been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
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We have not authorized anyone to provide any information other than that contained or incorporated by
reference in this pricing supplement and the accompanying prospectus supplement and prospectus. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may provide. We are not offering
the securities in any jurisdiction where the offer is not permitted. You should not assume that the information in this pricing supplement and the accompanying prospectus supplement and prospectus is accurate as of any date other than the date on
the front of this pricing supplement or the accompanying prospectus supplement or prospectus, as applicable.
Our affiliates, including BofA
Securities, Inc., will deliver this pricing supplement and the accompanying prospectus supplement and prospectus for offers and sales in the secondary market.
$8,000,000,000
Medium-Term Notes, Series N
$500,000,000 Floating Rate Senior
Notes, due October 2029
$2,000,000,000 5.385% Fixed/
Floating Rate Senior Notes, due
October 2029
$2,750,000,000 5.784% Fixed/
Floating Rate Senior Notes, due
October 2032
$2,750,000,000 6.062% Fixed/
Floating Rate Senior Notes, due
October 2037
PRICING SUPPLEMENT
Sole Book-Runner
BofA Securities
ANZ Securities
Apto
Partners, LLC
Banco Sabadell
BMO Capital Markets
BNY
Capital Markets
C.L. King & Associates
CastleOak Securities, L.P.
CIBC Capital Markets
Citizens Capital Markets
Commonwealth Bank of Australia
Fifth Third Securities
First Citizens Capital Securities
Goodbody
Huntington
Capital Markets
KeyBanc Capital Markets
Lloyds Securities
M&T
Securities
Mizuho
nabSecurities, LLC
Natixis
Nomura
Nordea
PNC Capital Markets LLC
Rabo Securities
Raiffeisen
Bank International
Ramirez & Co., Inc.
Scotiabank
Siebert
Williams Shank
SMBC Nikko
Standard Chartered Bank
TD
Securities
Truist Securities
UniCredit
Westpac Capital
Markets LLC
October 16, 2026

----- d415907dexfilingfees.htm -----
EXHIBIT
FILING
FEES
The prospectus to which this Exhibit is attached is a final prospectus for the related offering.
The maximum aggregate offering price for such offering is $
8,000,000,000
.