Warren Buffett is making a $5 billion investment in the bank of America last Thursday (Aug 25, 2011). Here is the deal:
- a guaranteed dividend payout of about $300 million a year.
- warrants for 700 million shares that he can exercise at $7.14 each over the next 10 years.
- Bank of America has the option to buy back the preferred shares at any time for a 5 percent premium.
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