Company Name: Bank of America Corp.
Public Availability Date: February 17, 2006
Document Sections:
INQUIRY LETTER
INQUIRY LETTER
STAFF REPLY LETTER
[INQUIRY LETTER]
February 13, 2006
BY OVERNIGHT DELIVERY
Securities and Exchange Commission
Office of Chief Counsel
Division of Corporation Finance
100 F. Street, N.E.
Washington, DC 20549
Re: Stockholder Proposal Submitted by John Jennings Crapo
Ladies and Gentlemen:
Bank of America Corporation (the "Corporation") received a letter on November
22, 2005 (the "Crapo Letter") from John Jennings Crapo. The Crapo Letter was
addressed to multiple parties, including the U.S. Court of Appeals for the First
Circuit, the City of Boston Inspectional Service Department, the Securities and
Exchange Commission (the "Commission") and the Commonwealth [Co-operative] Bank.
The Crapo Letter is generally illegible and, as discussed in more detail below,
does not appear to include a proposal for inclusion in the proxy materials for
the Corporation's 2006 Annual Meeting of Stockholders (the "2006 Annual
Meeting"). The Crapo Letter also includes multiple exhibits, none of which
appear related to any shareholder proposal. The Crapo Letter is attached hereto
as Exhibit A. Under the portion of the Crapo Letter addressed to the Commission,
there appears to be some reference to a possible shareholder proposal (for the
purposes of this letter, the "Proposal"). While the Corporation does not believe
that the Crapo Letter contains a shareholder proposal the Corporation
nevertheless submitted, by letter dated December 19, 2005, a request for
confirmation that the staff of the Division of Corporation Finance (the
"Division") would not recommend enforcement action if the Corporation omits the
Proposal from its proxy materials for the 2006 Annual Meeting for the reasons
set forth herein (the "December 19thLetter").
The Corporation has since learned that the December 19thLetter contained
irrelevant information that should have been omitted. Accordingly, the
Corporation is now resubmitting a substantively identical request to the
Division with that information removed. The Corporation requests that the
Division either not consider this letter to be a new request for purposes of the
eighty day requirement set forth in Rule 14a-8(j)(1), or that the Division
consider removal of the information previously submitted to be good cause for
missing the eighty day deadline and therefore accept this letter under authority
granted to it in Rule 14a-8(j)(1). See Abercrombie & Fitch Co. (May 2, 2005).
GENERAL
The 2006 Annual Meeting is scheduled to be held on or about April 26, 2006. The
Corporation intends to file its definitive proxy materials with the Commission
on or about March 20, 2006 and to commence mailing to its stockholders on or
about such date.
Pursuant to Rule 14a-8(j) promulgated under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), enclosed are:
1. Six copies of this letter, which includes an explanation of why the
Corporation believes that it may exclude the Proposal; and
2. Six copies of the Proposal.
A copy of this letter is also being sent to the Proponent as notice of the
Corporation's intent to omit the Proposal from the Corporation's proxy materials
for the 2006 Annual Meeting.
SUMMARY OF PROPOSAL
As noted above, the Corporation does not believe that the Crapo Letter contains
a shareholder proposal.
Under the portion of the Crapo Letter addressed to the Corporation it states:
"please add this & accompanying records to file of my shareholder proposal to
upcoming shareholders meeting of proxies and stockholders convened as a meeting
of stockholders in accordance"
Under the portion of the Crapo Letter addressed to the Commission it states:
"please add this to the files of my shareholders proposal re: limiting salary
increases of Bank of America members of its Corporate Board of Directors."
The Crapo Letter also included numerous exhibits. It is not clear whether these
exhibits are intended to be part of the Proposal.
REASONS FOR EXCLUSION OF PROPOSAL
The Corporation believes that the Proposal may be properly omitted from the
proxy materials for the 2006 Annual Meeting pursuant to Rules 14a-8(d) and (f)
and Rule 14a-8(i)(3). The Proposal may be excluded pursuant to Rule 14a-8(d) and
(f) because the Proposal, including its accompanying supporting statement and
exhibits, exceed the 500-word limitation. The Proposal may be excluded pursuant
to Rule 14a-8(i)(3) because it is vague and indefinite, in violation of Rule
14a-9 and Rule 14a-5.
1. The Corporation may omit the Proposal pursuant to Rules 14a-8(d) and (f)
because the Proposal, including its supporting statement, exceeds the 500 word
limitation.
The Corporation believes that the Proposal may be properly omitted from its
proxy materials for the 2006 Annual Meeting pursuant to Rules 14a-8(d) and
14a-8(f). Under Rule 14a-8(d) a stockholder proposal, including any accompanying
supporting statement, may not exceed 500 words. Generally, the Division has
routinely permitted the omission of a stockholder proposal from proxy materials
where a proponent failed, upon appropriate request, to revise a proposal to
comply with the 500-word limitation. See Bank of America Corporation (January
27, 2005); Proctor & Gamble Company (August 10, 2004); and Amgen, Inc. (January
12, 2004). By letter dated November 30 2005 (the "Request Letter"), the
Corporation requested that the Proponent revise his Proposal and supporting
statement to comply with the 500-word limitation. The Request Letter
specifically stated that the Proposal must be revised within 14 calendar days of
the Proponent's receipt of the letter. The Request Letter was received on
December 8, 2005. A copy of the Request Letter and evidence of its receipt by
the Proponent are attached hereto as Exhibit B. As of the date of this letter,
the Proposal has not been revised to comply with Rule 14a-8(d). Accordingly,
because the Proponent failed to cure, in a timely manner, the deficiency noted
above, the Corporation believes it may omit the Proposal from its proxy
materials for the 2006 Annual Meeting pursuant to Rule 14a-8(f).
2. The Corporation may omit the Proposal pursuant to Rule 14a-8(i)(3) because it
is vague and indefinite, in violation of Rule 14a-9 and Rule 14a-5.
The Division has recognized that a proposal and/or supporting statement may be
excluded under Rule 14a-8(i)(3) if it is so vague and indefinite that
shareholders voting on the proposal would not be able to determine with
reasonable certainty exactly what action or measures would be required in the
event the proposal was adopted. See Sara Lee Corporation (March 31, 2004); Bank
of America (March 10, 2004); Philadelphia Electric Co. (July 30, 1992); IDACORP, Inc. (January 9, 2001); and Northeast Utility Service Company (April 9, 2001).
Rule 14a-8(i)(3) permits the exclusion of a proposal if it or its supporting
statement is contrary to any of the Commission's proxy rules and regulations,
including Rule 14a-9, which prohibits the making of false or misleading
statements in proxy soliciting materials or the omission of any material fact
necessary to make statements contained therein not false or misleading, and Rule
14a-5, which requires that information in a proxy statement be "clearly
presented."
No Proposal Submitted. As noted above, the Corporation does not believe that the
Proponent submitted a recognizable proposal under Rule 14a-8. The Corporation
believes that the Crapo Letter is so vague and indefinite that (i) the
Corporation cannot determine what to present in its proxy materials for the 2006
Annual Meeting or what to present to stockholders at the meeting and (ii)
stockholders voting on the submission would not be able to determine with
reasonable certainty exactly what action or measures they are voting for or
against. For the same reasons, the Crapo Letter cannot be "clearly presented" in
the Corporation's proxy materials for the 2006 Annual Meeting. Accordingly the
Corporation believes it may omit the Crapo Letter and Proposal pursuant to Rule
14a-8(i)(3) because it is in violation of Rule 14a-9 and Rule 14a-5.
Assuming a Proposal Exists. Assuming that the Proposal is in fact "limiting
salary increases of Bank of America members of its Corporate Board of
Directors," the Proposal would nevertheless be so vague and indefinite that
shareholders voting on the submission would not be able to determine with
reasonable certainty exactly what action or measures would be required in the
event the Proposal was adopted. The Proposal does not include enough information
for the Corporation's stockholders to make an informed decision on the matter
being presented. Furthermore, the Proposal does not include enough clear
information for the Corporation to be able to implement without making
assumptions regarding what the Proponent actually had in mind. The Corporation
is unable to determine what the Proposal actually is requesting and believes
that its stockholders will face a similar dilemma if presented with the
Proposal. In addition, the supporting statement and exhibits are confusing and
misleading to stockholders because they appear to be wholly unrelated and
irrelevant to the subject matter of the Proposal (which is not particularly
clear). In these instances, the Division has regularly permitted exclusion of
all or portions of a supporting statement. See Sara Lee Corporation (March 31,
2004) (entire supporting statement excludable).
The Division, in numerous no-action letters, has permitted the exclusion of
shareholder proposals "involving vague and indefinite determinations ... that
neither the shareholders voting on the proposal nor the Company would be able to
determine with reasonable certainty what measures the Company would take if the
proposal was approved." See A.H. Belo Corp. (January 29, 1998.) Such proposals
were "inherently so vague and indefinite that neither the shareholders voting on
the proposal, nor the Company in implementing the proposal (if adopted), would
be able to determine with any reasonable certainty exactly what actions or
measures the proposal requires" or "so inherently vague and indefinite that
shareholders voting on the proposal would not be able to determine with
reasonable certainty what actions the Company would take under the proposal" or
"misleading because any action ultimately taken by the Company upon
implementation of the proposal could be significantly different from the actions
envisioned by shareholders voting on the proposal." See Proctor & Gamble Company
(October 25, 2002); Philadelphia Electric Company (July 30, 1992); NYNEX
Corporation (January 12, 1990).
Assuming the Proposal is in fact a proposal under Rule 14a-8, the Corporation
believes that the Proposal and its supporting statement are so vague, ambiguous,
indefinite and misleading, that the Proposal may be omitted under Rule
14a-8(i)(3), in violation of both Rule 14a-9 and Rule 14a-5.
CONCLUSION
On the basis of the foregoing, the Corporation respectfully requests the
concurrence of the Division that the Proposal may be excluded from the
Corporation's proxy materials for the 2006 Annual Meeting. Based on the
Corporation's timetable for the 2006 Annual Meeting, a response from the
Division as soon as possible would be of great assistance.
If you have any questions or would like any additional information regarding the
foregoing, please do not hesitate to contact the undersigned at 704-386-5083.
Please acknowledge receipt of this letter by stamping and returning the enclosed
receipt copy of this letter. Thank you for your prompt attention to this matter.
Very truly yours,
/s/
William J. Mostyn III
Deputy General Counsel and Corporate Secretary
cc: John Jennings Crapo
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[INQUIRY LETTER]
November 30, 2005
VIA CERTIFIED MAIL/ RETURN RECEIPT REQUESTED
Mr. John Jennings Crapo
P.O. Box 400151
Cambridge, MA 02140-0002
Re: Bank of America Corporation (the "Corporation")
Dear Mr. Crapo:
On November 22, 2005, we received your request to include a stockholder proposal
in the Corporation's 2006 annual proxy statement. In order to properly consider
your proposal for inclusion in the Corporation's proxy statement, you must meet
certain eligibility requirements. We were able to verify that you have
continuously held at least $2,000 in market value of the Corporation's common
stock and had held such stock continuously for at least one year by the date you
submitted your request to include a stockholder proposal in the Corporation's
2006 annual proxy statement. However, in accordance with Rule 14a-8(b) of the
Securities and Exchange Commission ("SEC"), we need for you to provide a written
statement that you intend to continue to hold the securities through the date of
the meeting of shareholders.
Furthermore, under SEC Rule 14a-8(d), a stockholder proposal and the
accompanying statement may not exceed 500 words. Although your proposal and the
supporting statement exceed this limit, you may submit a revised proposal under
SEC Rule 14a-8(f). Please note, however, if you do not provide a written
statement that you intend to continue to hold the securities through the date of
the meeting of shareholders and you do not submit a revised proposal that
complies with the 500 word limitation within 14 calendar days of your receipt of
this letter, we may properly exclude your proposal from our 2006 proxy
statement. For your convenience, I have attached a copy of the relevant SEC
provisions, Rule 14a-8(b)(d) and (f).
Notwithstanding the foregoing, the Corporation does not relinquish its right to
later object to including your proposal on related or different grounds pursuant
to applicable SEC rules.
Please send any future correspondence to my attention: William J. Mostyn III,
Corporate Secretary, Bank of America Corporation, NC1-007-20-01, 100 North Tryon
Street, Charlotte, NC 28255.
Very truly yours,
/s/
William J. Mostyn III
General Deputy Counsel and Corporate Secretary
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[STAFF REPLY LETTER]
February 17, 2006
Response of the Office of Chief Counsel Division of Corporation Finance
Re: Bank of America Corporation Incoming letter dated February 13, 2006
The submission relates to limiting salary increases of the company's directors.
To the extent that the submission involves a rule 14a-8 issue, there appears to
be some basis for your view that Bank of America may exclude the proposal under
rule 14a-8(i)(3), as vague and indefinite. Accordingly, we will not recommend
enforcement action to the Commission if Bank of America omits the submission
from its proxy materials in reliance on rule 14a-8(i)(3). In reaching this
position, we have not found it necessary to address the alternative basis for
omission upon which Bank of America relies.
We note that Bank of America did not file its statement of objections to
including the proposal in its proxy materials at least 80 days before the date
on which it will file definitive proxy materials as required by rule
14a-8(j)(1). Noting the circumstances of the delay, we grant Bank of America's
request that the 80-day requirement be waived.
Sincerely,
/s/
Mark F. Vilardo
Special Counsel
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