Bank of America Announces Commencement of Cash Tender Offer for MBIA Notes

CHARLOTTE, N.C.--()--Bank of America Corporation (the “Offeror”) announced today that it has commenced an offer to purchase for cash (the “Tender Offer”) any and all of the outstanding 5.70% Senior Notes due 2034 (CUSIP No. 55262CAJ9) (the “2004 MBIA Notes”) issued by MBIA Inc., a Connecticut corporation (MBIA), pursuant to a senior indenture dated as of November 24, 2004 (as supplemented, the “2004 Indenture”), between MBIA and The Bank of New York Mellon as trustee.

The purpose of the Tender Offer is to induce holders of record of 2004 MBIA Notes as of 5:00 p.m., New York City time, on November 6, 2012, and who have the right to grant or withhold consent to the 2004 Proposed Amendments (as defined below) (each an “Eligible Holder” and collectively the “Eligible Holders”) to sell their 2004 MBIA Notes to the Offeror rather than consent to certain proposed amendments to the 2004 Indenture (the “2004 Proposed Amendments”) being sought by MBIA in connection with MBIA’s consent solicitation, commenced on November 7, 2012 (the “MBIA Consent Solicitation”).

Affiliates of the Offeror are party to certain credit default swap transactions for which MBIA Insurance Corporation (a subsidiary of MBIA) has provided credit support with a notional value of $6.15 billion (against which we have established credit valuation adjustments for a significant portion). Bank of America believes that if the MBIA Consent Solicitation is successful, the risk of MBIA Insurance Corporation being placed in rehabilitation or liquidation will increase, which would jeopardize all policyholder claims, including Bank of America’s claims under these transactions.

Eligible Holders of 2004 MBIA Notes that are validly tendered and not validly withdrawn prior to 11:59 p.m., New York City time, on November 27, 2012 (the “Early Tender Date”), unless extended by the Offeror, will be eligible to receive the “Total Consideration” of $1,000 in cash per $1,000 principal amount of 2004 MBIA Notes that are accepted for payment, which includes an “Early Tender Premium” of $50 in cash per $1,000 principal amount of 2004 MBIA Notes. Eligible Holders of the 2004 MBIA Notes that are validly tendered after the Early Tender Date but prior to 11:59 p.m., New York City time, on December 11, 2012 (the “Expiration Date”), unless extended by the Offeror, will be eligible to receive only the “Tender Offer Consideration” of $950 in cash per $1,000 principal amount of 2004 MBIA Notes that are accepted for purchase.

In addition to the Total Consideration or the Tender Offer Consideration, as applicable, Eligible Holders whose 2004 MBIA Notes are accepted for purchase in the Tender Offer will also receive accrued and unpaid interest in cash from the most recent interest payment date on the 2004 MBIA Notes up to, but not including, the settlement date for the Tender Offer, which is expected to occur promptly after the Expiration Date, assuming all conditions of the Tender Offer have been either satisfied or waived. The Tender Offer is irrevocable, subject only to the satisfaction or waiver of the express conditions set forth in the Offer to Purchase. The Offeror expressly reserves the right to extend the Early Tender Date, the Withdrawal Deadline (as defined below) and/or the Expiration Date, and to amend the Tender Offer in a manner not adverse to holders of the 2004 MBIA Notes, as described more fully in the materials being sent to holders of 2004 MBIA Notes.

Eligible Holders of the 2004 MBIA Notes will be entitled to withdraw their tendered Notes prior to 11:59 p.m., New York City time, on November 27, 2012 (the “Withdrawal Deadline”), but not thereafter, unless the Withdrawal Deadline is extended by the Offeror.

The Tender Offer is subject to certain conditions including (i) there having been validly tendered pursuant to the Tender Offer, and not validly withdrawn, not less than a majority in aggregate principal amount of the 2004 MBIA Notes outstanding; (ii) MBIA shall not have obtained the requisite consent of Eligible Holders needed to validly approve the 2004 Proposed Amendments, and the 2004 Proposed Amendments shall not have become effective; and (iii) other customary conditions. By tendering 2004 MBIA Notes, an Eligible Holder will be required to represent and warrant that it is an Eligible Holder and that either it has not delivered a consent in connection with the MBIA Consent Solicitation or any consent previously delivered by it has been timely and validly revoked, and will be required to covenant that it will not deliver any consent in connection with the MBIA Consent Solicitation (or any amendment or supplement thereto) or otherwise vote in favor of the 2004 Proposed Amendments. Eligible Holders of 2004 MBIA Notes may not tender their 2004 MBIA Notes in the Tender Offer and also submit consents in the MBIA Consent Solicitation. However, Eligible Holders who have submitted consents in the MBIA Consent Solicitation and who timely and validly revoke their consents may tender their 2004 MBIA Notes in the Tender Offer.

The complete terms and conditions of the Tender Offer are described in the Offer to Purchase, dated November 13, 2012 (the "Offer to Purchase"), and the related Letter of Transmittal (the "Letter of Transmittal").

D.F. King & Co., Inc. is acting as tender agent and information agent for the Tender Offer. Requests for documents and questions regarding procedures for submission of tenders should be directed to D.F. King & Co., Inc. at 1.800.848.3416 (U.S. toll-free), 212.269.5550 (banks and brokers only, call collect) or mbia@dfking.com or by visiting http://www.dfking.com/mbia. Other questions regarding the Tender Offer may be directed to BofA Merrill Lynch, the dealer manager for the Tender Offer, at 1.888.292.0070 (U.S. toll-free) or 980.388.4813 (collect).

This news release shall not constitute a solicitation to buy or an offer to purchase any securities. The Tender Offer is being made solely pursuant to, and in accordance with the terms and conditions specified in, the Offer to Purchase and the Letter of Transmittal. No offer, solicitation, purchase or sale will be made in any jurisdiction in which such an offer, solicitation, or sale would be unlawful. None of the Offeror, its board of directors, officers or affiliates, the dealer manager, the tender agent, the information agent or the trustee is making any recommendation as to whether Eligible Holders should tender their 2004 MBIA Notes in the Tender Offer.

Bank of America

Bank of America is one of the world's largest financial institutions, serving individual consumers, small- and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving more than 55 million consumer and small business relationships with approximately 5,500 retail banking offices and approximately 16,300 ATMs and award-winning online banking with 30 million active users. Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to more than 3 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients through operations in more than 40 countries. Bank of America Corporation stock (NYSE: BAC) is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange.

Forward-Looking Statements

Certain statements in this news release represent the current expectations, plans or forecasts of Bank of America and are forward-looking. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. These statements often use words like “expects,” “anticipates,” “believes,” “estimates,” “targets,” “intends,” “plans,” “predict,” “goal” and other similar expressions or future or conditional verbs such as “will,” “may,” “might,” “should,” “would” and “could.” The forward-looking statements made in this press release include, without limitation, statements concerning the Tender Offer and the expected timing of payment for the tendered 2004 MBIA Notes. Forward-looking statements speak only as of the date they are made, and Bank of America undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances or events that arise after the date the forward-looking statement was made.

These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumptions that are difficult to predict and are often beyond Bank of America’s control. Actual outcomes and results may differ materially from those expressed in, or implied by, any of these forward-looking statements. You should not place undue reliance on any forward-looking statement and should consider all of the uncertainties and risks discussed under Item 1A. “Risk Factors” of Bank of America’s Annual Report on Form 10-K for the year ended December 31, 2011 and in any of Bank of America’s other subsequent Securities and Exchange Commission filings.

For more Bank of America news, visit the Bank of America newsroom.

www.bankofamerica.com

Contacts

Investors May Contact:
Kevin Stitt, Bank of America, 1.980.386.5667
Lee McEntire, Bank of America, 1.980.388.6780
Reporters May Contact:
Jerry Dubrowski, Bank of America, 1.980.388.2840
jerome.f.dubrowski@bankofamerica.com

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Contacts

Investors May Contact:
Kevin Stitt, Bank of America, 1.980.386.5667
Lee McEntire, Bank of America, 1.980.388.6780
Reporters May Contact:
Jerry Dubrowski, Bank of America, 1.980.388.2840
jerome.f.dubrowski@bankofamerica.com