Response of the Office of Mergers and Acquisitions

Division of Corporation Finance

Via Email

James A. Brigagliano
Sidley Austin LLP
jbrigagliano@sidley.com

Re:      Request by BofA Securities, Inc. for No-Action Relief under Rule 14e-5

Dear Mr. Brigagliano:

We are responding to your letter dated January 24, 2020, addressed to Ted Yu and Christina Chalk. To avoid having to recite or summarize the facts set forth in your letter, we attach a copy of your letter. Unless otherwise noted, capitalized terms in this response letter have the same meaning as in your letter.

You have requested no-action relief from Rule 14e-5 to permit BofA Securities, Inc., its affiliates, and its separately identifiable departments to engage in hedging activities in connection with index-linked equity derivatives transactions, as described in your letter. On the basis of your representations and the facts presented, the Division will not recommend enforcement action under Rule 14e-5, subject to the conditions listed in your letter. In particular, we note that:

• the relevant index would not be sponsored, administered, or otherwise controlled by BofA or its affiliates; 
• at the time the Derivative Transaction is initiated or amended, such index would be comprised of at least 17 different equity securities (issued by at least 17 different issuers);
• at the time the Derivative Transaction is initiated or amended, no subject or related security would exceed 10% of the index; 
• the hedging activities will be effected in the ordinary course of business and not for the purpose of facilitating any tender offer; 
• the underlying equity securities or related securities acquired as a result of hedging will not be tendered in any offer; 
• BofA or its affiliates will not directly or indirectly enter into Derivative Transactions with an offeror in a tender offer (or any such offeror’s “covered persons”) and no such Derivative Transaction will be entered into with the purpose of facilitating any tender offer by the counterparty;
• the registration statement and other offer documents relating to any tender offer will disclose the possibility of, or the intention to make, purchases of the underlying equity securities or related securities outside the tender offer; and
• except for the relief granted specifically herein, BofA or its affiliates will comply with Rule 14e-5. 

This no-action position is based on the representations made to the Division in your request. Any different facts or conditions might require the Division to reach a different conclusion. Further, this response does not express any legal conclusion on the question presented or any views on any other questions that the transaction may raise.