Linked to the Least Performing
of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s
Corporation
|
•
|
Approximate
3 year term if not called prior to maturity.
|
|
•
|
Payments
on the Notes will depend on the individual performance of the Common Stock of Waste Management, Inc., the Common Stock of Automatic
Data Processing, Inc. and the Common Stock of McDonald’s Corporation (each an “Underlying Stock”).
|
|
•
|
Provided
that the Notes have not previously been automatically called, a fixed coupon rate of 7.50% per annum (0.625% per month) payable
monthly.
|
|
•
|
Beginning
in October 2020, automatically callable quarterly for an amount equal to the principal amount plus a Fixed Coupon Payment if the
Observation Value of each Underlying Stock is greater than or equal to its Starting Value on the relevant Observation Date
occurring each quarter.
|
|
•
|
Assuming
the Notes are not called prior to maturity, if any Underlying Stock declines by more than 40% from its Starting Value, at
maturity your investment will be subject to a 1:1 downside, with up to 100% of the principal at risk; otherwise, at maturity investors
will receive the principal amount. At maturity the investor will also receive the final Fixed Coupon Payment, regardless of the
performance of the Least Performing Underlying.
|
|
•
|
All
payments on the Notes are subject to the credit risk of BofA Finance LLC (“BofA Finance”) and Bank of America Corporation
(“BAC” or the “Guarantor”).
|
|
•
|
The
Notes priced on October 4, 2019, will issue on October 9, 2019 and will mature on October 7, 2022.
|
|
•
|
The
Notes will not be listed on any securities exchange.
|
The initial
estimated value of the Notes as of the pricing date is $982.00 per Note, which is less than the public offering price listed below.
The actual value of your Notes at any time will reflect many factors and cannot be predicted with accuracy. See “Risk Factors”
beginning on page PS-8 of this pricing supplement and “Structuring the Notes” on page PS-20 of this pricing supplement
for additional information. Potential purchasers of the Notes should consider the information in “Risk Factors”
beginning on page PS-8 of this pricing supplement, page PS-5 of the accompanying product supplement, page S-4 of the accompanying
prospectus supplement, and page 7 of the accompanying prospectus.
None of the
Securities and Exchange Commission (the “SEC”), any state securities commission, or any other regulatory body has approved
or disapproved of these securities or determined if this Note Prospectus (as defined on page PS-25) is truthful or complete. Any
representation to the contrary is a criminal offense.
|
Public offering price (1)
|
Underwriting discount (1)
|
Proceeds, before expenses, to BofA Finance
|
Per Note
|
$1,000.00
|
$7.50
|
$992.50
|
Total
|
$2,024,000.00
|
$15,180.00
|
$2,008,820.00
|
(1) Certain
dealers who purchase the Notes for sale to certain fee-based advisory accounts may forgo some or all of their selling concessions,
fees or commissions. The public offering price for investors purchasing the Notes in these fee-based advisory accounts may be as
low as $992.50 per Note.
The Notes and the
related guarantee:
Are Not FDIC Insured
|
Are Not Bank Guaranteed
|
May Lose Value
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Terms of the Notes
Provided that
the Notes have not been previously automatically called, the Fixed Income Auto-Callable Yield Notes Linked to the Least Performing
of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s
Corporation (the “Notes”) provide a monthly Fixed Coupon Payment of $6.25 on each Fixed Payment Date. Beginning in
October 2020, if the Observation Value of each Underlying Stock is greater than or equal to its Starting Value on any of
the Observation Dates indicated by the third footnote appearing below the table on page PS-4, the Notes will be automatically called,
in whole but not in part, at 100% of the principal amount, together with a Fixed Coupon Payment. No further amounts will be payable
following an Automatic Call. If the Notes are not automatically called prior to maturity and the Least Performing Underlying Stock
declines by more than 40% from its Starting Value, there is full exposure to declines in the Least Performing Underlying Stock,
and you will lose a significant portion or all of your investment in the Notes. Otherwise, at maturity you will receive the principal
amount. At maturity, you will also receive the final Fixed Coupon Payment. The Notes are not traditional debt securities and it
is possible that you may lose a significant portion or all of your principal amount at maturity. Any payments on the Notes will
be calculated based on $1,000 in principal amount of Notes and will depend on the performance of the Underlying Stocks, subject
to our and BAC’s credit risk.
Issuer:
|
BofA Finance
|
Guarantor:
|
BAC
|
Denominations:
|
The Notes will be issued in minimum denominations of $1,000 and whole multiples of $1,000 in excess thereof.
|
Term:
|
Approximately three years, unless previously automatically called.
|
Underlying Stocks:
|
The Common Stock of Waste Management, Inc. (NYSE symbol: “WM”), the Common Stock of Automatic Data Processing, Inc. (Nasdaq Global Select Market symbol: “ADP”) and the Common Stock of McDonald’s Corporation (NYSE symbol: “MCD”).
|
Pricing Date:
|
October 4, 2019
|
Issue Date:
|
October 9, 2019
|
Valuation Date:
|
October 4, 2022, subject to postponement as described under “Description of the Notes—Certain Terms of the Notes—Events Relating to Observation Dates” of the accompanying product supplement. If the Valuation Date is not a business day, the Valuation Date will be postponed to the next business day.
|
Maturity Date:
|
October 7, 2022
|
Starting Value:
|
WM: $116.61
ADP: $159.17
MCD: $211.69
|
Observation Value:
|
With respect to each Underlying Stock, its Closing Market Price on the applicable Observation Date, multiplied by its Price Multiplier, determined by the calculation agent.
|
Ending Value:
|
With respect to each Underlying Stock, its Observation Value on the Valuation Date.
|
Threshold Value:
|
WM: $69.97,
which is 60% of its Starting Value (rounded to two decimal places).
ADP: $95.50,
which is 60% of its Starting Value (rounded to two decimal places).
MCD: $127.01,
which is 60% of its Starting Value (rounded to two decimal places).
|
Price Multiplier:
|
With respect to each Underlying Stock, 1, subject to adjustment for certain corporate events relating to that Underlying Stock described in the product supplement under “Description of the Notes—Anti-Dilution Adjustments.”
|
Fixed Coupon Payment:
|
Provided that the Notes have not been previously automatically called, we will pay a monthly Fixed Coupon Payment of $6.25 per $1,000 in principal amount of Notes (equal to a rate of 0.625% per month or 7.50% per annum) on the applicable Fixed Payment Date (including the Maturity Date).
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-2
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Automatic Call:
|
Beginning in October 2020, all (but not less than all) of the Notes will be automatically called if the Observation Value of each Underlying Stock is greater than or equal to its Starting Value on any of the Observation Dates indicated by the third footnote appearing below the table on page PS-4. If the Notes are automatically called, the Early Redemption Amount will be paid on the Fixed Payment Date immediately following such Observation Date. No further amounts will be payable following an Automatic Call.
|
Early Redemption Amount:
|
For each $1,000
in principal amount of Notes, $1,000 plus a Fixed Payment.
|
Redemption Amount:
|
If the Notes
have not been automatically called prior to maturity, the Redemption Amount per $1,000 in principal amount of Notes will be:
a)
If the Ending Value of the Least Performing Underlying
Stock is greater than or equal to its Threshold Value:
$1,000; or
b)
If the Ending Value of the Least Performing Underlying
Stock is less than its Threshold Value:
$1,000 + ($1,000
x the Underlying Stock Return of the Least Performing Underlying Stock)
In this case,
the Redemption Amount will be less than 60% of the principal amount and could be zero.
The Redemption
Amount will also include the final Fixed Coupon Payment regardless of the performance of the Least Performing Underlying Stock.
|
Observation Dates:
|
As set forth on page PS-4.
|
Fixed Payment Dates:
|
As set forth on page PS-4.
|
Calculation Agent:
|
BofA Securities, Inc. (“BofAS”), an affiliate of BofA Finance.
|
Selling Agent:
|
BofAS
|
CUSIP:
|
09709TVY4
|
Underlying Stock Return:
|
With respect
to each Underlying Stock,
|
Events of Default and Acceleration:
|
If an Event of Default, as defined in the senior indenture and in the section entitled “Events of Default and Rights of Acceleration” beginning on page 35 of the accompanying prospectus, with respect to the Notes occurs and is continuing, the amount payable to a holder of the Notes upon any acceleration permitted under the senior indenture will be equal to the amount described under the caption “—Redemption Amount” above, calculated as though the date of acceleration were the Maturity Date of the Notes and as though the Valuation Date were the third trading day prior to the date of acceleration. The final Fixed Coupon Payment will be prorated by the calculation agent to reflect the length of the final fixed payment period. In case of a default in the payment of the Notes, whether at their maturity or upon acceleration, the Notes will not bear a default interest rate.
|
Least Performing Underlying Stock:
|
The Underlying Stock with the lowest Underlying Stock Return.
|
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-3
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Observation Dates
and Fixed Payment Dates
Observation Dates*
|
|
Fixed Payment Dates**
|
November 4, 2019
|
|
November 7, 2019
|
December 4, 2019
|
|
December 9, 2019
|
January 6, 2020
|
|
January 9, 2020
|
February 4, 2020
|
|
February 7, 2020
|
March 4, 2020
|
|
March 9, 2020
|
April 6, 2020
|
|
April 9, 2020
|
May 4, 2020
|
|
May 7, 2020
|
June 4, 2020
|
|
June 9, 2020
|
July 6, 2020
|
|
July 9, 2020
|
August 4, 2020
|
|
August 7, 2020
|
September 4, 2020
|
|
September 10, 2020
|
October 5, 2020***
|
|
October 8, 2020
|
November 4, 2020
|
|
November 9, 2020
|
December 4, 2020
|
|
December 9, 2020
|
January 4, 2021***
|
|
January 7, 2021
|
February 4, 2021
|
|
February 9, 2021
|
March 4, 2021
|
|
March 9, 2021
|
April 5, 2021***
|
|
April 8, 2021
|
May 4, 2021
|
|
May 7, 2021
|
June 4, 2021
|
|
June 9, 2021
|
July 6, 2021***
|
|
July 9, 2021
|
August 4, 2021
|
|
August 9, 2021
|
September 7, 2021
|
|
September 10, 2021
|
October 4, 2021***
|
|
October 7, 2021
|
November 4, 2021
|
|
November 9, 2021
|
December 6, 2021
|
|
December 9, 2021
|
January 4, 2022***
|
|
January 7, 2022
|
February 4, 2022
|
|
February 9, 2022
|
March 4, 2022
|
|
March 9, 2022
|
April 4, 2022***
|
|
April 7, 2022
|
May 4, 2022
|
|
May 9, 2022
|
June 6, 2022
|
|
June 9, 2022
|
July 5, 2022***
|
|
July 8, 2022
|
August 4, 2022
|
|
August 9, 2022
|
September 6, 2022
|
|
September 9, 2022
|
October 4, 2022 (the “Valuation Date”)
|
|
October 7, 2022 (the “Maturity Date”)
|
* The Observation
Dates are subject to postponement as set forth in “Description of the Notes—Certain Terms of the Notes—Events
Relating to Observation Dates” on page PS-19 of the accompanying product supplement. If an Observation Date is not a business
day, such Observation Date will be postponed to the next business day.
** Postponement
of a monthly Observation Date will not cause the postponement of the Fixed Payment Date immediately following such Observation
Date.
*** The Notes
will be automatically called if on such date the Observation Value of each Underlying Stock is greater than or equal to its Starting
Value. If the Notes are automatically called, the Early Redemption Amount will be paid on the applicable Fixed Payment Date immediately
following such Observation Date. No further amounts will be payable following an Automatic Call.
Any
payments on the Notes depend on the credit risk of BofA Finance, as issuer, and BAC, as guarantor, and on the performance of the
Underlying Stocks. The economic terms of the Notes are based on BAC’s internal funding rate, which is the rate it would pay
to borrow funds through the issuance of market-linked notes, and the economic terms of certain related hedging arrangements BAC’s
affiliates enter into.
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-4
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
BAC’s internal funding rate is typically lower
than the rate it would pay when it issues conventional fixed or floating rate debt securities. This difference in funding rate,
as well as the underwriting discount and the hedging related charges described below (see
“Risk Factors” beginning on page PS-10),
reduced the economic terms of the Notes to you and the initial estimated value of the Notes. Due to these factors, the public offering
price you are paying to purchase the Notes is greater than the initial estimated value of the Notes as of the pricing date.
The initial
estimated value of the Notes as of the pricing date is set forth on the cover page of this pricing supplement. For more information
about the initial estimated value and the structuring of the Notes, see “Risk Factors” beginning on page PS-8 and “Structuring
the Notes” on page PS-20.
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-5
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Redemption Amount Determination
Assuming the Notes have not been automatically called, on the Maturity Date, you will receive a cash payment per $1,000 in principal
amount of Notes determined as follows:
All payments
described above are subject to issuer and guarantor credit risk.
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-6
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Hypothetical Payout Profile and Examples
of Payments at Maturity
Fixed Income Auto-Callable
Yield Notes Table
The following
table is for purposes of illustration only. It assumes the Notes have not been automatically called prior to maturity and is based
on hypothetical values and shows hypothetical returns on the Notes. The table illustrates the calculation of the
Redemption Amount and the return on the Notes based on a hypothetical Starting Value of 100, a hypothetical Threshold Value of
60 for the Least Performing Underlying Stock, the Fixed Coupon Payment of $6.25 per $1,000 in principal amount of Notes and a range
of hypothetical Ending Values of the Least Performing Underlying Stock. The actual amount you receive and the resulting return
will depend on the actual Starting Values, Threshold Values, Observation Values and Ending Values of the Underlying Stocks, whether
the Notes are automatically called prior to maturity, and whether you hold the Notes to maturity. The following examples do
not take into account any tax consequences from investing in the Notes.
For recent actual
prices of the Underlying Stocks, see “The Underlying Stocks” section below. The Ending Value of each Underlying Stock
will not include any income generated by dividends paid on that Underlying Stock, which you would otherwise be entitled to receive
if you invested in those Underlying Stocks directly. In addition, all payments on the Notes are subject to Issuer and Guarantor
credit risk.
Ending Value of the
Least Performing Underlying Stock
|
Underlying Stock Return of the
Least Performing Underlying Stock
|
Redemption Amount per Note (including any final Fixed Coupon Payment)
|
Return
on the Notes(1)
|
160.00
|
60.00%
|
$1,006.25 (2)
|
0.625%
|
150.00
|
50.00%
|
$1,006.25
|
0.625%
|
140.00
|
40.00%
|
$1,006.25
|
0.625%
|
130.00
|
30.00%
|
$1,006.25
|
0.625%
|
120.00
|
20.00%
|
$1,006.25
|
0.625%
|
110.00
|
10.00%
|
$1,006.25
|
0.625%
|
105.00
|
5.00%
|
$1,006.25
|
0.625%
|
102.00
|
2.00%
|
$1,006.25
|
0.625%
|
100.00(3)
|
0.00%
|
$1,006.25
|
0.625%
|
90.00
|
-10.00%
|
$1,006.25
|
0.625%
|
80.00
|
-20.00%
|
$1,006.25
|
0.625%
|
70.00
|
-30.00%
|
$1,006.25
|
0.625%
|
60.00(4)
|
-40.00%
|
$1,006.25
|
0.625%
|
55.00
|
-45.00%
|
$556.25
|
-44.375%
|
50.00
|
-50.00%
|
$506.25
|
-49.375%
|
0.00
|
-100.00%
|
$6.25
|
-99.375%
|
|
(1)
|
The “Return on the
Notes” is calculated based on the Redemption Amount and final Fixed Coupon Payment, not including any Fixed Coupon Payments
paid prior to maturity.
|
|
(2)
|
This amount represents
the sum of the principal amount and the final Fixed Coupon Payment.
|
|
(3)
|
The hypothetical Starting
Value of 100 used in the table above has been chosen for illustrative purposes only. The actual Starting Value for each Underlying
Stock is set forth on page PS-2 above.
|
|
(4)
|
This is the hypothetical
Threshold Value of the Least Performing Underlying Stock.
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-7
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Risk Factors
Your investment in the Notes
entails significant risks, many of which differ from those of a conventional debt security. 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, 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. You should carefully review the more detailed explanation
of risks relating to the Notes in the “Risk Factors” sections beginning on page PS-5 of the accompanying product supplement,
page S-4 of the accompanying prospectus supplement and page 7 of the accompanying prospectus, each as identified on page PS-25
below.
|
•
|
Your
investment may result in a loss; there is no guaranteed return of principal. There is no fixed principal repayment amount on
the Notes at maturity. If the Notes are not automatically called prior to maturity and the Ending Value of any Underlying
Stock is less than its Threshold Value, you will lose 1% of the principal amount for each 1% that the Ending Value of the Least
Performing Underlying Stock is less than its Starting Value. In that case, you will lose a significant portion or all of your investment
in the Notes.
|
|
•
|
Your
return on the Notes is limited to the return represented by the Fixed Coupon Payments over the term of the Notes. Your return
on the Notes is limited to the Fixed Coupon Payments paid over the term of the Notes, regardless of the extent to which the Ending
Value of any Underlying Stock exceeds its Starting Value. Similarly, the amount payable at maturity or upon an Automatic Call will
never exceed the sum of the principal amount and a Fixed Coupon Payment, regardless of the extent to which the Observation Value
of any Underlying Stock exceeds its Starting Value. In contrast, a direct investment in one or more of the Underlying Stocks would
allow you to receive the benefit of any appreciation in their prices. Thus, any return on the Notes will not reflect the return
you would realize if you actually owned shares of an Underlying Stock and received the dividends paid or distributions made on
them.
|
|
•
|
The
Notes are subject to a potential Automatic Call, which would limit your ability to receive the Fixed Coupon Payments over the full
term of the Notes. The Notes are subject to a potential Automatic Call. Beginning in October 2020, the Notes will be automatically
called if, on any of the Observation Dates indicated by the third footnote appearing below the table on page PS-4, the Observation
Value of each Underlying Stock is greater than or equal to its Starting Value. If the Notes are automatically called, you will
be entitled to receive the principal amount and a Fixed Coupon Payment. In this case, you will lose the opportunity to continue
to receive Fixed Coupon Payments after the date of the Automatic Call. If the Notes are called prior to the Maturity Date, you
may be unable to invest in other securities with a similar level of risk that could provide a return that is similar to the Notes.
|
|
•
|
Your return on
the Notes may be less than the yield on a conventional debt security of comparable maturity. Any return that you receive on
the Notes may be less than the return you would earn if you purchased a conventional debt security with the same Maturity Date.
As a result, your investment in the Notes may not reflect the full opportunity cost to you when you consider factors, such as inflation,
that affect the time value of money. In addition, if interest rates increase during the term of the Notes, the Fixed Coupon Payment
may be less than the yield on a conventional debt security of comparable maturity.
|
|
•
|
Any
payments on the Notes are subject to the credit risk of BofA Finance and the Guarantor, and actual or perceived changes in BofA
Finance or the Guarantor’s creditworthiness are expected to affect the value of the Notes. The Notes are our senior unsecured
debt securities. Any payment on the Notes will be fully and unconditionally guaranteed by the Guarantor. The Notes are not guaranteed
by any entity other than the Guarantor. As a result, your receipt of the Early Redemption Amount or the Redemption Amount at maturity,
as applicable, will be dependent upon our ability and the ability of the Guarantor to repay our respective obligations under the
Notes on the applicable Fixed Payment Date or the Maturity Date, regardless of the Ending Value of the Least Performing Underlying
Stock as compared to its Starting Value.
|
In
addition, our credit ratings and the credit ratings of the Guarantor are assessments by ratings agencies of our respective abilities
to pay our obligations. Consequently, our or the Guarantor’s perceived creditworthiness and actual or anticipated decreases
in our or the Guarantor’s credit ratings or increases in the spread between the yield on our respective securities and the
yield on U.S. Treasury securities (the “credit spread”) prior to the Maturity Date may adversely affect the market
value of the Notes. However, because your return on the Notes depends upon factors in addition to our ability and the ability of
the Guarantor to pay our respective obligations, such as the values of the Underlying Stocks, an improvement in our or the Guarantor’s
credit ratings will not reduce the other investment risks related to the Notes.
|
•
|
We
are a finance subsidiary and, as such, will have limited assets and operations. We are a finance subsidiary of BAC and will
have no assets, operations or revenues other than those related to the issuance, administration and repayment of our debt securities
that are guaranteed by the Guarantor. As a finance subsidiary, to meet our obligations under the Notes, we are dependent upon payment
or contribution of funds and/or repayment of outstanding loans from the Guarantor and/or its other subsidiaries. Therefore, our
ability to make payments on the Notes may be limited.
|
|
•
|
The
public offering price you are paying for the Notes exceeds their initial estimated value. The initial estimated value of the
Notes that is provided on the cover page of this pricing supplement is an estimate only, determined as of the pricing date by reference
to our and our affiliates’ pricing models. These pricing models consider certain assumptions and variables, including our
credit spreads and those of the Guarantor, the Guarantor’s internal funding rate, mid-market terms on hedging transactions,
expectations on interest rates, dividends and volatility, price-sensitivity analysis, and the expected term of the Notes. These
pricing models rely in part on certain forecasts about future events, which may prove to be incorrect. If you attempt to sell the
Notes prior to maturity, their market value may be lower than the price you paid for them and lower than their initial estimated
value. This is due to, among other things, changes in the prices of the Underlying
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-8
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Stocks, the Guarantor’s internal funding
rate, and the inclusion in the public offering price of the underwriting discount and the hedging related charges, all as further
described in "Structuring the Notes" below. These factors, together with various credit, market and economic factors
over the term of the Notes, are expected to reduce the price at which you may be able to sell the Notes in any secondary market
and will affect the value of the Notes in complex and unpredictable ways.
|
•
|
The initial estimated
value does not represent a minimum or maximum price at which we, BAC, BofAS or any of our other affiliates
would be willing to purchase your Notes in any secondary market (if any exists) at any time. The value of your Notes at any
time after issuance will vary based on many factors that cannot be predicted with accuracy, including the performance of the Underlying
Stocks, our and BAC’s creditworthiness and changes in market conditions.
|
|
•
|
We
cannot assure you that a trading market for your Notes will ever develop or be maintained. We will not list the Notes on any
securities exchange. We cannot predict how the Notes will trade in any secondary market or whether that market will be liquid or
illiquid.
|
|
•
|
The
Early Redemption Amount or Redemption Amount, as applicable, will not reflect the prices of the Underlying Stocks other than on
the Observation Dates or the Valuation Date, as applicable. The prices of the Underlying Stocks during the term of the Notes
other than on the Observation Dates will not affect payments on the Notes. Notwithstanding the foregoing, investors should generally
be aware of the performance of the Underlying Stocks while holding the Notes. The Calculation Agent will calculate the Early Redemption
Amount or the Redemption Amount, as applicable, by comparing only the Starting Value, or the Threshold Value, as applicable, to
the Observation Value or the Ending Value for each Underlying Stock. No other prices of the Underlying Stocks will be taken into
account. As a result, if the Notes are not automatically called prior to maturity, you will receive less than the principal amount
at maturity even if the price of each Underlying Stock has increased at certain times during the term of the Notes before the Least
Performing Underlying Stock decreases to a price that is less than its Threshold Value as of the Valuation Date.
|
|
•
|
Because
the Notes are linked to the least performing (and not the average performance) of the Underlying Stocks, you may not receive any
return on the Notes and may lose some or all of your principal amount even if the Ending Value of one Underlying Stock is greater
than or equal to its Threshold Value. Your Notes are linked to the least performing of the Underlying Stocks, and a change
in the price of one Underlying Stock may not correlate with changes in the price of the other Underlying Stock(s). The Notes are
not linked to a basket composed of the Underlying Stocks, where the depreciation in the price of one Underlying Stock could be
offset to some extent by the appreciation in the price of the other Underlying Stock(s). In the case of the Notes, the individual
performance of each Underlying Stock would not be combined, and the depreciation in the price of one Underlying Stock would not
be offset by any appreciation in the price of the other Underlying Stock(s). Even if the Ending Value of an Underlying Stock is
at or above its Threshold Value, you will lose a portion of your principal if the Ending Value of the Least Performing Underlying
Stock is below its Threshold Value.
|
|
•
|
Trading
and hedging activities by us, the Guarantor and any of our other affiliates may create conflicts of interest with you and may affect
your return on the Notes and their market value. We, the Guarantor or one or more of our other affiliates, including BofAS,
may buy or sell shares of the Underlying Stocks, or futures or options contracts on those securities, or other listed or over-the-counter
derivative instruments linked to the Underlying Stocks. We, the Guarantor or one or more of our other affiliates, including BofAS,
may execute such purchases or sales for our own or their own accounts, for business reasons, or in connection with hedging our
obligations under the Notes. These transactions may present a conflict of interest between your interest in the Notes and the interests
we, the Guarantor and our other affiliates, including BofAS, may have in our or their proprietary accounts, in facilitating transactions,
including block trades, for our or their other customers, and in accounts under our or their management. These transactions may
affect the prices of the Underlying Stocks in a manner that could be adverse to your investment in the Notes. On or before the
pricing date, any purchases or sales by us, the Guarantor or our other affiliates, including BofAS or others on its behalf (including
for the purpose of hedging anticipated exposures), may have affected the prices of the Underlying Stocks. Consequently, the prices
of the Underlying Stocks may change subsequent to the pricing date, adversely affecting the market value of the Notes.
|
We, the
Guarantor or one or more of our other affiliates, including BofAS, may also have engaged in hedging activities that could have
affected the prices of the Underlying Stocks on the pricing date. In addition, these activities may decrease the market value of
your Notes prior to maturity, and may affect the amounts to be paid on the Notes. We, the Guarantor or one or more of our other
affiliates, including BofAS, may purchase or otherwise acquire a long or short position in the Notes and may hold or resell the
Notes. For example, BofAS may enter into these transactions in connection with any market making activities in which it engages.
We cannot assure you that these activities will not adversely affect the prices of the Underlying Stocks, the market value of your
Notes prior to maturity or the amounts payable on the Notes.
|
•
|
There
may be potential conflicts of interest involving the calculation agent, which is an affiliate of ours. We have the right to
appoint and remove the calculation agent. One of our affiliates will be the calculation agent for the Notes and, as such, will
make a variety of determinations relating to the Notes, including the amounts that will be paid on the Notes. Under some circumstances,
these duties could result in a conflict of interest between its status as our affiliate and its responsibilities as calculation
agent.
|
|
•
|
The
terms of the Notes will not be adjusted for all corporate events that could affect an issuer of an Underlying Stock. The Price
Multiplier, the determination of the payments on the Notes, and other terms of the Notes may be adjusted for the specified corporate
events affecting any Underlying Stock, as described in the section entitled “Description of the Notes—Anti-Dilution
Adjustments” on page PS-21 of product supplement STOCK-1. However, these adjustments do not cover all corporate events
that could affect the market price of an Underlying Stock, such as offerings of common shares for cash or in connection with certain
acquisition transactions. The occurrence of any event that does not require the calculation agent to adjust the applicable Price
Multiplier or the amounts that may be paid on the Notes at maturity may adversely affect the price of an Underlying Stock, and,
as a result, the market value of the Notes.
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-9
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
|
•
|
The
U.S. federal income tax consequences of an investment in the Notes are uncertain, and may be adverse to a holder of the Notes.
No statutory, judicial, or administrative authority directly addresses the characterization of the Notes or securities similar
to the Notes for U.S. federal income tax purposes. As a result, significant aspects of the U.S. federal income tax consequences
of an investment in the Notes are not certain. Under the terms of the Notes, you will have agreed with us to treat the Notes as
fixed income-bearing single financial contracts, as described below under “U.S. Federal Income Tax Summary—General.”
If the Internal Revenue Service (the “IRS”) were successful in asserting an alternative characterization for the Notes,
the timing and character of gain or loss with respect to the Notes may differ. No ruling will be requested from the IRS with respect
to the Notes and no assurance can be given that the IRS will agree with the statements made in the section entitled “U.S.
Federal Income Tax Summary.” You are urged to consult with your own tax advisor regarding all aspects of the U.S. federal
income tax consequences of investing in the Notes.
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-10
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
The Underlying Stocks
We
have derived the following information on each Underlying Stock and each company issuing each Underlying Stock (each, an “Underlying
Company” and, together, the “Underlying Companies”) from publicly available documents. Because each Underlying
Stock is registered under the Securities Exchange Act of 1934, the Underlying Companies are required to file periodically certain
financial and other information specified by the SEC. Information provided to or filed with the SEC by the Underlying Companies
can be located through the SEC’s web site at sec.gov by reference to the applicable CIK number set forth below.
This
document relates only to the offering of the Notes and does not relate to any offering of Underlying Stock or any other securities
of the Underlying Companies. None of us, the Guarantor, BofAS or any of our other affiliates has made any due diligence inquiry
with respect to the Underlying Companies in connection with the offering of the Notes. None of us, the Guarantor, BofAS or any
of our other affiliates has independently verified the accuracy or completeness of the publicly available documents or any other
publicly available information regarding the Underlying Companies and hence makes no representation regarding the same. Furthermore,
there can be no assurance that all events occurring prior to the date of this document, including events that would affect the
accuracy or completeness of these publicly available documents that would affect the trading price of the Underlying Stocks, have
been or will be publicly disclosed. Subsequent disclosure of any events or the disclosure or failure to disclose material future
events concerning an Underlying Company could affect the price of the applicable Underlying Stock and therefore could affect your
return on the Notes. The selection of the Underlying Stocks is not a recommendation to buy or sell the Underlying Stocks.
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-11
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Waste Management, Inc.
Waste Management, Inc. provides
waste management and environmental services. This Underlying Stock trades on the NASDAQ under the symbol “ADP.” The
company’s CIK number is 0000823768.
The following table shows
the quarterly high and low Closing Market Prices of the shares of this Underlying Stock on its primary exchange from the first
quarter of 2008 through October 4, 2019. We obtained this historical data from Bloomberg L.P. We have not independently verified
the accuracy or completeness of the information obtained from Bloomberg L.P. These historical trading prices may have been adjusted
to reflect certain corporate actions, such as stock splits and reverse stock splits.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
|
34.45
|
29.15
|
Second Quarter
|
39.10
|
33.80
|
Third Quarter
|
37.06
|
31.49
|
Fourth Quarter
|
33.14
|
25.76
|
2009
|
|
|
First Quarter
|
33.78
|
22.23
|
Second Quarter
|
28.88
|
25.59
|
Third Quarter
|
30.75
|
26.58
|
Fourth Quarter
|
34.10
|
28.39
|
2010
|
|
|
First Quarter
|
34.88
|
31.40
|
Second Quarter
|
35.66
|
31.29
|
Third Quarter
|
35.85
|
31.65
|
Fourth Quarter
|
36.99
|
34.25
|
2011
|
|
|
First Quarter
|
38.34
|
36.04
|
Second Quarter
|
39.61
|
36.37
|
Third Quarter
|
38.00
|
28.17
|
Fourth Quarter
|
34.68
|
29.83
|
2012
|
|
|
First Quarter
|
35.64
|
32.35
|
Second Quarter
|
36.08
|
32.15
|
Third Quarter
|
35.68
|
31.59
|
Fourth Quarter
|
34.33
|
30.96
|
2013
|
|
|
First Quarter
|
39.21
|
33.97
|
Second Quarter
|
42.75
|
38.14
|
Third Quarter
|
43.50
|
39.85
|
Fourth Quarter
|
46.10
|
40.40
|
2014
|
|
|
First Quarter
|
44.20
|
40.41
|
Second Quarter
|
44.84
|
41.06
|
Third Quarter
|
47.53
|
43.89
|
Fourth Quarter
|
51.58
|
46.28
|
2015
|
|
|
First Quarter
|
55.18
|
51.23
|
Second Quarter
|
55.14
|
46.35
|
Third Quarter
|
52.70
|
46.37
|
Fourth Quarter
|
54.61
|
50.10
|
2016
|
|
|
First Quarter
|
59.71
|
51.52
|
Second Quarter
|
66.27
|
56.35
|
Third Quarter
|
67.90
|
62.65
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-12
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Fourth Quarter
|
71.14
|
61.70
|
2017
|
|
|
First Quarter
|
73.78
|
69.18
|
Second Quarter
|
74.25
|
70.50
|
Third Quarter
|
78.62
|
73.39
|
Fourth Quarter
|
86.30
|
76.28
|
2018
|
|
|
First Quarter
|
89.71
|
79.12
|
Second Quarter
|
86.02
|
80.00
|
Third Quarter
|
92.51
|
81.49
|
Fourth Quarter
|
93.75
|
83.70
|
2019
|
|
|
First Quarter
|
103.91
|
88.48
|
Second Quarter
|
116.97
|
100.57
|
Third Quarter
|
120.65
|
111.90
|
Fourth Quarter (through the pricing date)
|
116.61
|
114.77
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-13
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Automatic Data Processing,
Inc.
Automatic Data Processing, Inc.
is a provider of cloud-based human capital management solutions. This Underlying Stock trades on the NASDAQ under the symbol “ADP.”
The company’s CIK number is 0000008670.
The following table shows
the quarterly high and low Closing Market Prices of the shares of this Underlying Stock on its primary exchange from the first
quarter of 2008 through October 4, 2019. We obtained this historical data from Bloomberg L.P. We have not independently verified
the accuracy or completeness of the information obtained from Bloomberg L.P. These historical trading prices may have been adjusted
to reflect certain corporate actions, such as stock splits and reverse stock splits.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
|
37.92
|
33.25
|
Second Quarter
|
39.66
|
36.53
|
Third Quarter
|
40.21
|
35.45
|
Fourth Quarter
|
36.96
|
27.22
|
2009
|
|
|
First Quarter
|
35.80
|
28.77
|
Second Quarter
|
34.06
|
30.23
|
Third Quarter
|
34.99
|
29.24
|
Fourth Quarter
|
38.81
|
34.02
|
2010
|
|
|
First Quarter
|
39.40
|
35.34
|
Second Quarter
|
39.90
|
35.01
|
Third Quarter
|
37.41
|
33.87
|
Fourth Quarter
|
41.15
|
36.63
|
2011
|
|
|
First Quarter
|
45.01
|
41.13
|
Second Quarter
|
48.35
|
44.93
|
Third Quarter
|
48.27
|
39.31
|
Fourth Quarter
|
47.76
|
40.77
|
2012
|
|
|
First Quarter
|
49.93
|
47.19
|
Second Quarter
|
49.08
|
44.67
|
Third Quarter
|
52.07
|
48.47
|
Fourth Quarter
|
52.22
|
47.96
|
2013
|
|
|
First Quarter
|
57.05
|
51.22
|
Second Quarter
|
63.15
|
55.94
|
Third Quarter
|
65.57
|
60.93
|
Fourth Quarter
|
71.13
|
61.62
|
2014
|
|
|
First Quarter
|
70.87
|
64.51
|
Second Quarter
|
70.18
|
64.68
|
Third Quarter
|
73.99
|
70.15
|
Fourth Quarter
|
86.07
|
71.42
|
2015
|
|
|
First Quarter
|
90.18
|
82.53
|
Second Quarter
|
87.99
|
80.23
|
Third Quarter
|
84.70
|
73.52
|
Fourth Quarter
|
90.53
|
80.89
|
2016
|
|
|
First Quarter
|
89.71
|
77.34
|
Second Quarter
|
91.87
|
85.14
|
Third Quarter
|
95.72
|
86.56
|
Fourth Quarter
|
103.45
|
86.09
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-14
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
2017
|
|
|
First Quarter
|
105.11
|
95.25
|
Second Quarter
|
105.16
|
96.46
|
Third Quarter
|
118.91
|
101.31
|
Fourth Quarter
|
118.64
|
109.32
|
2018
|
|
|
First Quarter
|
123.63
|
108.25
|
Second Quarter
|
140.34
|
113.30
|
Third Quarter
|
150.68
|
132.61
|
Fourth Quarter
|
151.77
|
121.95
|
2019
|
|
|
First Quarter
|
159.74
|
126.21
|
Second Quarter
|
169.61
|
156.00
|
Third Quarter
|
173.27
|
157.77
|
Fourth Quarter (through the pricing date)
|
160.43
|
156.62
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-15
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
McDonald’s
Corporation.
McDonald’s
Corporation is a company that franchises restaurants that serve food and beverages in more than 100 countries. This Underlying
Stock trades on the NYSE under the symbol “MCD.” The company’s CIK number is 0000063908.
The
following table shows the quarterly high and low Closing Market Prices of the shares of this Underlying Stock on its primary exchange
from the first quarter of 2008 through October 4, 2019. We obtained this historical data from Bloomberg L.P. We have not independently
verified the accuracy or completeness of the information obtained from Bloomberg L.P. These historical trading prices may have
been adjusted to reflect certain corporate actions, such as stock splits and reverse stock splits.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
|
58.17
|
50.75
|
Second Quarter
|
61.17
|
55.40
|
Third Quarter
|
65.95
|
57.19
|
Fourth Quarter
|
63.66
|
51.55
|
2009
|
|
|
First Quarter
|
63.75
|
50.86
|
Second Quarter
|
60.99
|
52.40
|
Third Quarter
|
58.82
|
54.23
|
Fourth Quarter
|
64.53
|
56.61
|
2010
|
|
|
First Quarter
|
67.35
|
61.45
|
Second Quarter
|
71.52
|
65.87
|
Third Quarter
|
76.08
|
66.11
|
Fourth Quarter
|
80.34
|
74.92
|
2011
|
|
|
First Quarter
|
76.73
|
72.67
|
Second Quarter
|
84.57
|
75.99
|
Third Quarter
|
90.79
|
82.11
|
Fourth Quarter
|
100.81
|
85.83
|
2012
|
|
|
First Quarter
|
101.74
|
95.55
|
Second Quarter
|
99.40
|
86.32
|
Third Quarter
|
93.71
|
87.15
|
Fourth Quarter
|
94.09
|
84.05
|
2013
|
|
|
First Quarter
|
99.69
|
89.85
|
Second Quarter
|
103.59
|
96.42
|
Third Quarter
|
101.58
|
94.36
|
Fourth Quarter
|
98.92
|
93.27
|
2014
|
|
|
First Quarter
|
98.78
|
93.02
|
Second Quarter
|
103.53
|
97.01
|
Third Quarter
|
101.07
|
91.09
|
Fourth Quarter
|
97.17
|
88.46
|
2015
|
|
|
First Quarter
|
100.25
|
88.78
|
Second Quarter
|
100.68
|
94.30
|
Third Quarter
|
101.10
|
91.21
|
Fourth Quarter
|
120.07
|
98.78
|
2016
|
|
|
First Quarter
|
125.83
|
115.12
|
Second Quarter
|
131.60
|
116.30
|
Third Quarter
|
128.26
|
114.44
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-16
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Fourth Quarter
|
123.72
|
110.57
|
2017
|
|
|
First Quarter
|
129.61
|
119.48
|
Second Quarter
|
154.80
|
129.29
|
Third Quarter
|
161.53
|
151.85
|
Fourth Quarter
|
174.20
|
156.86
|
2018
|
|
|
First Quarter
|
178.36
|
148.27
|
Second Quarter
|
169.48
|
155.94
|
Third Quarter
|
167.29
|
155.41
|
Fourth Quarter
|
189.26
|
162.97
|
2019
|
|
|
First Quarter
|
189.90
|
173.97
|
Second Quarter
|
207.66
|
188.35
|
Third Quarter
|
221.15
|
206.30
|
Fourth Quarter (through the pricing date)
|
211.69
|
206.27
|
|
FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-17
|
Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Supplement to the Plan of Distribution;
Role of BofAS and Conflicts of Interest
BofAS, a broker-dealer
affiliate of ours, is a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”) and will participate
as selling agent in the distribution of the Notes. Accordingly, the offering of the Notes will conform to the requirements of FINRA
Rule 5121. BofAS may not make sales in this offering to any of its discretionary accounts without the prior written approval of
the account holder.
We will deliver
the Notes against payment therefor in New York, New York on a date that is greater than two business days following the pricing
date. Under Rule 15c6-1 of the Securities Exchange Act of 1934, trades in the secondary market generally are required to settle
in two business days, unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade
the Notes more than two business days prior to the original issue date will be required to specify alternative settlement arrangements
to prevent a failed settlement.
Under our distribution
agreement with BofAS, BofAS will purchase the Notes from us as principal at the public offering price indicated on the cover of
this pricing supplement, less the indicated underwriting discount. BofAS will sell the Notes to other broker-dealers that will
participate in the offering and that are not affiliated with us, at an agreed discount to the principal amount. Each of those broker-dealers
may sell the Notes to one or more additional broker-dealers. BofAS has informed us that these discounts may vary from dealer to
dealer and that not all dealers will purchase or repurchase the Notes at the same discount. Certain dealers who purchase the Notes
for sale to certain fee-based advisory accounts may forgo some or all of their selling concessions, fees or commissions. The public
offering price for investors purchasing the Notes in these fee-based advisory accounts may be as low as $992.50 per Note.
BofAS and any
of our other broker-dealer affiliates, may use this pricing supplement, and the accompanying product supplement, prospectus supplement
and prospectus for offers and sales in secondary market transactions and market-making transactions in the Notes. However, they
are not obligated to engage in such secondary market transactions and/or market-making transactions. The selling agent may act
as principal or agent in these transactions, and any such sales will be made at prices related to prevailing market conditions
at the time of the sale.
At BofAS’s
discretion, for a short, undetermined initial period after the issuance of the Notes, BofAS may offer to buy the Notes in the secondary
market at a price that may exceed the initial estimated value of the Notes. Any price offered by BofAS for the Notes will be based
on then-prevailing market conditions and other considerations, including the performance of the Underlying Stocks and the remaining
term of the Notes. However, none of us, the Guarantor, BofAS or any of our other affiliates is obligated to purchase your Notes
at any price or at any time, and we cannot assure you that any party will purchase your Notes at a price that equals or exceeds
the initial estimated value of the Notes.
Any price that
BofAS may pay to repurchase the Notes will depend upon then prevailing market conditions, the creditworthiness of us and the Guarantor,
and transaction costs. At certain times, this price may be higher than or lower than the initial estimated value of the Notes.
European Economic
Area
None of this pricing
supplement, the accompanying product supplement, the accompanying prospectus or the accompanying prospectus supplement is a prospectus
for the purposes of the Prospectus Regulation (as defined below). This pricing supplement, the accompanying product supplement,
the accompanying prospectus and the accompanying prospectus supplement have been prepared on the basis that any offer of Notes
in any Member State of the European Economic Area (the “EEA”) which has implemented the Prospectus Regulation (each,
a “Relevant Member State”) will only be made to a legal entity which is a qualified investor under the Prospectus Regulation
(“Qualified Investors”). Accordingly any person making or intending to make an offer in that Relevant Member State
of Notes which are the subject of the offering contemplated in this pricing supplement, the accompanying product supplement, the
accompanying prospectus and the accompanying prospectus supplement may only do so with respect to Qualified Investors. Neither
BofA Finance nor BAC have authorized, nor do they authorize, the making of any offer of Notes other than to Qualified Investors.
The expression “Prospectus Regulation” means Regulation (EU) 2017/1129.
PROHIBITION
OF SALES TO 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 retail investor in the EEA. For these purposes: (a) 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”); or (ii) a customer within the meaning of Directive (EU) 2016/97 (the Insurance Distribution Directive),
as amended or superseded, 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 Prospectus Regulation; and (b) the expression “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. Consequently no key information document
required by Regulation (EU) No 1286/2014, as amended (the “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 PRIIPs Regulation.
The communication
of this pricing supplement, the accompanying product supplement, the accompanying prospectus supplement, the accompanying prospectus
and any other document or materials relating to the issue of the Notes offered hereby is not being made, and such documents and/or
materials have not been approved, by an authorized person for the purposes of section 21 of the United Kingdom’s Financial
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FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-18
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Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Services and Markets
Act 2000, as amended (the “FSMA”). Accordingly, such documents and/or materials are not being distributed to, and must
not be passed on to, the general public in the United Kingdom. The communication of such documents and/or materials as a financial
promotion is only being made to those persons in the United Kingdom who have professional experience in matters relating to investments
and who fall within the definition of investment professionals (as defined in Article 19(5) of the Financial Services and Markets
Act 2000 (Financial Promotion) Order 2005, as amended (the “Financial Promotion Order”)), or who fall within Article
49(2)(a) to (d) of the Financial Promotion Order, or who are any other persons to whom it may otherwise lawfully be made under
the Financial Promotion Order (all such persons together being referred to as “relevant persons”). In the United Kingdom,
the Notes offered hereby are only available to, and any investment or investment activity to which this pricing supplement, the
accompanying product supplement, the accompanying prospectus supplement and the accompanying prospectus relates will be engaged
in only with, relevant persons. Any person in the United Kingdom that is not a relevant person should not act or rely on this pricing
supplement, the accompanying product supplement, the accompanying prospectus supplement or the accompanying prospectus or any of
their contents.
Any invitation
or inducement to engage in investment activity (within the meaning of Section 21 of the FSMA) in connection with the issue or sale
of the Notes may only be communicated or caused to be communicated in circumstances in which Section 21(1) of the FSMA does not
apply to the Issuer or the Guarantor.
All applicable
provisions of the FSMA must be complied with in respect to anything done by any person in relation to the Notes in, from or otherwise
involving the United Kingdom.
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FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-19
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Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Structuring the Notes
The
Notes are our debt securities, the return on which is linked to the performance of the Underlying Stocks. The related guarantee
is BAC’s obligation. As is the case for all of our and BAC’s respective debt securities, including our market-linked
notes, the economic terms of the Notes reflect our and BAC’s actual or perceived creditworthiness at the time of pricing.
In addition, because market-linked notes result in increased operational, funding and liability management costs to us and BAC,
BAC typically borrows the funds under these types of notes at a rate, which we refer to in this pricing supplement as BAC’s
internal funding rate, that is more favorable to BAC than the rate that it might pay for a conventional fixed or floating rate
debt security. This generally relatively lower internal funding rate, which is reflected in the economic terms of the Notes, along
with the fees and charges associated with market-linked notes, resulted in the initial estimated value of the Notes on the pricing
date being less than their public offering price.
In order
to meet our payment obligations on the Notes, at the time we issue the Notes, we may choose to enter into certain hedging arrangements
(which may include call options, put options or other derivatives) with BofAS or one of our other affiliates. The terms of these
hedging arrangements are determined based upon terms provided by BofAS and its affiliates, and take into account a number of factors,
including our and BAC’s creditworthiness, interest rate movements, the volatility of the Underlying Stocks, the tenor of
the Notes and the hedging arrangements. The economic terms of the Notes and their initial estimated value depend in part on the
terms of these hedging arrangements.
BofAS
has advised us that the hedging arrangements will include hedging related charges, reflecting the costs associated with, and our
affiliates’ profit earned from, these hedging arrangements. Since hedging entails risk and may be influenced by unpredictable
market forces, actual profits or losses from these hedging transactions may be more or less than any expected amounts.
For
further information, see “Risk Factors” beginning on page PS-8 above and “Supplemental Use of Proceeds”
on page PS-16 of the accompanying product supplement.
Validity of the Notes
In the opinion
of McGuireWoods LLP, as counsel to BofA Finance and BAC, when the trustee has made an appropriate entry on Schedule 1 to the Master
Registered Global Note dated November 4, 2016 that represents the Notes (the “Master Note”) identifying the Notes offered
hereby as supplemental obligations thereunder in accordance with the instructions of BofA Finance, and the Notes have been delivered
against payment therefor as contemplated in this pricing supplement and the related prospectus, prospectus supplement and product
supplement, all in accordance with the provisions of the indenture governing the Notes and the related guarantee, such Notes will
be legal, valid and binding obligations of BofA Finance, and the related guarantee will be the legal, valid and binding obligations
of BAC, subject, in each case, 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 Limited Liability Company Act 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 hereof. In addition, this opinion is subject to customary assumptions about the trustee’s authorization,
execution and delivery of the indenture governing the Notes and due authentication of the Master Note, the validity, binding nature
and enforceability of the indenture governing the Notes and the related guarantee 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 August 23, 2016, which has been
filed as an exhibit to the Registration Statement of BofA Finance and BAC relating to the Notes and the related guarantees initially
filed with the Securities and Exchange Commission on August 23, 2016.
Sidley Austin
LLP, New York, New York, is acting as counsel to BofAS and as special tax counsel to BofA Finance and BAC.
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FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-20
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Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
U.S. Federal Income Tax Summary
The following
summary of the material U.S. federal income tax considerations of the acquisition, ownership, and disposition of the Notes supplements,
and to the extent inconsistent supersedes, the discussions under “U.S. Federal Income Tax Considerations” in the accompanying
prospectus and under “U.S. Federal Income Tax Considerations” in the accompanying prospectus supplement and is not
exhaustive of all possible tax considerations. In addition, any reference to “Morrison & Foerster LLP” in the aforementioned
tax discussions in the accompanying prospectus and prospectus supplement should be read as a reference to “Sidley Austin
LLP.” 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 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 summary 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.
Although the Notes
are issued by us, they will be treated as if they were issued by BAC for U.S. federal income tax purposes. Accordingly throughout
this tax discussion, references to “we,” “our” or “us” are generally to BAC unless the context
requires otherwise.
This summary is
directed solely to U.S. Holders and Non-U.S. Holders that, except as otherwise specifically noted, will purchase the Notes upon
original issuance and will hold the Notes as capital assets within the meaning of Section 1221 of the Code, which generally means
property held for investment, and that are not excluded from the discussion under “U.S. Federal Income Tax Considerations”
in the accompanying prospectus.
You should
consult your own tax advisor concerning the U.S. federal income tax consequences to you of acquiring, owning, and disposing of
the Notes, as well as any tax consequences arising under the laws of any state, local, foreign, or other tax jurisdiction and the
possible effects of changes in U.S. federal or other tax laws.
General
Although there
is no statutory, judicial, or administrative authority directly addressing the characterization of the Notes, we intend to treat
the Notes for all tax purposes as fixed income-bearing single financial contracts with respect to the Underlying Stocks and
under the terms of the Notes, we and every investor in the Notes agree, in the absence of an administrative determination or judicial
ruling to the contrary, to treat the Notes in accordance with such characterization. In the opinion of our counsel, Sidley Austin
LLP, it is reasonable to treat the Notes as fixed income-bearing single financial contracts with respect to the Underlying
Stocks. However, Sidley Austin LLP has advised us that it is unable to conclude that it is more likely than not that this treatment
will be upheld. This discussion assumes that the Notes constitute fixed income-bearing single financial contracts with respect
to the Underlying Stocks for U.S. federal income tax purposes. If the Notes did not constitute fixed income-bearing single
financial contracts, the tax consequences described below would be materially different.
This characterization
of the Notes is not binding on the IRS or the courts. No statutory, judicial, or administrative authority directly addresses the
characterization of the Notes or any similar instruments for U.S. federal income tax purposes, and no ruling is being requested
from the IRS with respect to their proper characterization and treatment. Due to the absence of authorities on point, significant
aspects of the U.S. federal income tax consequences of an investment in the Notes are not certain, and no assurance can be given
that the IRS or any court will agree with the characterization and tax treatment described in this pricing supplement. Accordingly,
you are urged to consult your tax advisor regarding all aspects of the U.S. federal income tax consequences of an investment in
the Notes, including possible alternative characterizations.
Unless otherwise
stated, the following discussion is based on the characterization described above. The discussion in this section assumes that
there is a significant possibility of a significant loss of principal on an investment in the Notes.
We will not attempt
to ascertain whether the issuer of any Underlying Stock would be treated as a “passive foreign investment company”
(“PFIC”), within the meaning of Section 1297 of the Code, or a United States real property holding corporation, within
the meaning of Section 897(c) of the Code. If the issuer of any Underlying Stock were so treated, certain adverse U.S. federal
income tax consequences could possibly apply to a holder of the Notes. You should refer to information filed with the SEC by the
issuers of the Underlying Stocks and consult your tax advisor regarding the possible consequences to you, if any, if the issuer
of any Underlying Stock is or becomes a PFIC or is or becomes a United States real property holding corporation.
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FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-21
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Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
U.S. Holders
Although the U.S.
federal income tax treatment of any Fixed Coupon Payment on the Notes is uncertain, we intend to take the position, and the
following discussion assumes, that any Fixed Coupon Payment constitutes taxable ordinary income to a U.S. Holder at the time
received or accrued in accordance with the U.S. Holder’s regular method of accounting. By purchasing the Notes you agree,
in the absence of an administrative determination or judicial ruling to the contrary, to treat any Fixed Coupon Payment as
described in the preceding sentence.
Upon receipt of
a cash payment at maturity or upon a sale, exchange, or redemption of the Notes prior to maturity, a U.S. Holder generally will
recognize capital gain or loss equal to the difference between the amount realized (other than amounts representing any Fixed
Coupon Payment, which would be taxed as described above) and the U.S. Holder’s tax basis in the Notes. A U.S. Holder’s
tax basis in the Notes will equal the amount paid by that holder to acquire them. This capital gain or loss generally will be long-term
capital gain or loss if the U.S. Holder held the Notes for more than one year. The deductibility of capital losses is subject to
limitations.
Alternative
Tax Treatments. Due to the absence of authorities that directly address the proper tax treatment of the Notes, prospective
investors are urged to consult their tax advisors regarding all possible alternative tax treatments of an investment in the Notes.
In particular, the IRS could seek to subject the Notes to the Treasury regulations governing fixed payment debt instruments.
If the IRS were successful in that regard, the timing and character of income on the Notes would be affected significantly. Among
other things, a U.S. Holder would be required to accrue original issue discount every year at a “comparable yield”
determined at the time of issuance. In addition, any gain realized by a U.S. Holder at maturity or upon a sale, exchange, or redemption
of the Notes generally would be treated as ordinary income, and any loss realized at maturity or upon a sale, exchange, or redemption
of the Notes generally would be treated as ordinary loss to the extent of the U.S. Holder’s prior accruals of original issue
discount, and as capital loss thereafter.
In addition, it
is possible that the Notes could be treated as a unit consisting of a deposit and a put option written by the Note holder, in which
case the timing and character of income on the Notes would be affected significantly.
The IRS released
Notice 2008-2 (the “Notice”), which sought comments from the public on the taxation of financial instruments currently
taxed as “prepaid forward contracts.” This Notice addresses instruments such as the Notes. According to the Notice,
the IRS and Treasury are considering whether a holder of an instrument such as the Notes should be required to accrue ordinary
income on a current basis, regardless of whether any payments are made prior to maturity. It is not possible to determine what
guidance the IRS and Treasury will ultimately issue, if any. Any such future guidance may affect the amount, timing and character
of income, gain, or loss in respect of the Notes, possibly with retroactive effect.
The IRS and Treasury
are also considering additional issues, including whether additional gain or loss from such instruments should be treated as ordinary
or capital, whether foreign holders of such instruments should be subject to withholding tax on any deemed income accruals, whether
Section 1260 of the Code, concerning certain “constructive ownership transactions,” generally applies or should generally
apply to such instruments, and whether any of these determinations depend on the nature of the underlying asset.
In addition, proposed
Treasury regulations require the accrual of income on a current basis for fixed payments made under certain notional principal
contracts. The preamble to the regulations states that the “wait and see” method of accounting does not properly reflect
the economic accrual of income on those contracts, and requires current accrual of income for some contracts already in existence.
While the proposed regulations do not apply to prepaid forward contracts, the preamble to the proposed regulations expresses the
view that similar timing issues exist in the case of prepaid forward contracts. If the IRS or Treasury publishes future guidance
requiring current economic accrual for fixed payments on prepaid forward contracts, it is possible that you could be required
to accrue income over the term of the Notes.
Because of the
absence of authority regarding the appropriate tax characterization of the Notes, it is also possible that the IRS could seek to
characterize the Notes in a manner that results in tax consequences that are different from those described above. For example,
the IRS could possibly assert that any gain or loss that a holder may recognize at maturity or upon the sale, exchange, or redemption
of the Notes should be treated as ordinary gain or loss.
Non-U.S. Holders
Because the U.S.
federal income tax treatment of the Notes (including any Fixed Coupon Payment) is uncertain, we will withhold U.S. federal
income tax at a 30% rate (or at a lower rate under an applicable income tax treaty) on the entire amount of any Fixed Coupon
Payment made unless such payments are effectively connected with the conduct by the Non-U.S. Holder of a trade or business in the
U.S. (in which case, to avoid withholding, the Non-U.S. Holder will be required to provide a Form W-8ECI). We will not pay any
additional amounts in respect of such withholding. 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
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FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-22
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Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
the appropriate treaty’s limitations on
benefits article, if applicable. In addition, special rules may apply to claims for treaty benefits made by Non-U.S. Holders that
are entities rather than individuals. The availability of a lower rate of withholding under an applicable income tax treaty will
depend on whether such rate applies to the characterization of the payments under U.S. federal income tax laws. 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.
Except as discussed
below, a Non-U.S. Holder generally will not be subject to U.S. federal income or withholding tax for amounts paid in respect of
the Notes (not including, for the avoidance of doubt, amounts representing any Fixed Coupon Payment which would be subject
to the rules discussed in the previous paragraph) upon the sale, exchange, or redemption of the Notes or their settlement at maturity,
provided that the Non-U.S. Holder complies with applicable certification requirements and that the payment is not effectively connected
with the conduct by the Non-U.S. Holder of a U.S. trade or business. Notwithstanding the foregoing, gain from the sale, exchange,
or redemption of the Notes or their settlement at maturity may be subject to U.S. federal income tax if that Non-U.S. Holder is
a non-resident alien individual and is present in the U.S. for 183 days or more during the taxable year of the sale, exchange,
redemption, or settlement and certain other conditions are satisfied.
If a Non-U.S.
Holder of the Notes is engaged in the conduct of a trade or business within the U.S. and if any Fixed Coupon Payment and gain
realized on the settlement at maturity, or upon sale, exchange, or redemption of the Notes, 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 U.S.), the Non-U.S. Holder, although exempt from U.S. federal withholding tax, generally will be subject to U.S.
federal income tax on such Fixed Coupon Payment and gain on a net income basis in the same manner as if it were a U.S. Holder.
Such Non-U.S. Holders should read the material under the heading “—U.S. Holders,” for a description of the U.S.
federal income tax consequences of acquiring, owning, and disposing of the Notes. 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 such lower rate provided by any applicable tax treaty)
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 U.S., subject to certain adjustments.
A “dividend
equivalent” payment is treated as a dividend from sources within the United States and such payments generally would be subject
to a 30% U.S. withholding tax if paid to a Non-U.S. Holder. Under Treasury regulations, payments (including deemed payments) with
respect to equity-linked instruments (“ELIs”) that are “specified ELIs” may be treated as dividend equivalents
if such specified ELIs reference an interest in an “underlying security,” which is generally any interest in an entity
taxable as a corporation for U.S. federal income tax purposes if a payment with respect to such interest could give rise to a U.S.
source dividend. However, IRS guidance provides that withholding on dividend equivalent payments will not apply to specified ELIs
that are not delta-one instruments and that are issued before January 1, 2021. Based on our determination that the Notes are not
delta-one instruments, Non-U.S. Holders should not be subject to withholding on dividend equivalent payments, if any, under the
Notes. However, it is possible that the Notes could be treated as deemed reissued for U.S. federal income tax purposes upon the
occurrence of certain events affecting the Underlying Stocks or the Notes, and following such occurrence the Notes could be treated
as subject to withholding on dividend equivalent payments. Non-U.S. Holders that enter, or have entered, into other transactions
in respect of the Underlying Stocks or the Notes should consult their tax advisors as to the application of the dividend equivalent
withholding tax in the context of the Notes and their other transactions. If any payments are treated as dividend equivalents subject
to withholding, we (or the applicable paying agent) would be entitled to withhold taxes without being required to pay any additional
amounts with respect to amounts so withheld.
As discussed above,
alternative characterizations of the Notes for U.S. federal income tax purposes are possible. Should an alternative characterization,
by reason of change or clarification of the law, by regulation or otherwise, cause payments as to the Notes to become subject to
withholding tax in addition to the withholding tax described above, tax will be withheld at the applicable statutory rate. Prospective
Non-U.S. Holders should consult their own tax advisors regarding the tax consequences of such alternative characterizations.
U.S. Federal
Estate Tax. Under current law, while the matter is not entirely clear, individual Non-U.S. Holders, and entities whose property
is potentially includible in those individuals’ gross estates for U.S. federal estate tax purposes (for example, a trust
funded by such an individual and with respect to which the individual has retained certain interests or powers), should note that,
absent an applicable treaty benefit, a Note is likely to be treated as U.S. situs property, subject to U.S. federal estate tax.
These individuals and entities should consult their own tax advisors regarding the U.S. federal estate tax consequences of investing
in a Note.
Backup Withholding
and Information Reporting
Please see the
discussion under “U.S. Federal Income Tax Considerations — Taxation of Debt Securities — Backup Withholding and
Information Reporting” in the accompanying prospectus for a description of the applicability of the backup withholding and
information reporting rules to payments made on the Notes.
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FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-23
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Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Foreign Account
Tax Compliance Act (“FATCA”)
The discussion
in the accompanying prospectus under “U.S. Federal Income Tax Considerations – Foreign Account Tax Compliance Act”
is hereby modified to reflect regulations proposed by Treasury indicating its intent to eliminate the requirements under FATCA
of withholding on gross proceeds from the sale, exchange, settlement at maturity, or other disposition of relevant financial instruments.
Treasury has indicated that taxpayers may rely on these proposed regulations pending their finalization.
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FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-24
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Fixed Income Auto-Callable Yield Notes Linked to the Least Performing of the Common Stock of Waste Management, Inc., the Common Stock of Automatic Data Processing, Inc. and the Common Stock of McDonald’s Corporation
Where You Can Find More Information
The terms and risks of the Notes
are contained in this pricing supplement and in the following related product supplement, prospectus supplement and prospectus,
which can be accessed at the following links:
|
•
|
Product
Supplement STOCK-1 dated November 30, 2016:
|
https://www.sec.gov/Archives/edgar/data/70858/000119312516780826/d304271d424b2.htm
These documents
(together, the “Note Prospectus”) have been filed as part of a registration statement with the SEC, which may, without
cost, be accessed on the SEC website at www.sec.gov or obtained from BofAS by calling 1-800-294-1322. Before you invest, you should
read the Note Prospectus, including this pricing supplement, for information about us, BAC and this offering. Any prior or contemporaneous
oral statements and any other written materials you may have received are superseded by the Note Prospectus. Capitalized terms
used but not defined in this pricing supplement have the meanings set forth in the accompanying product supplement or prospectus
supplement. Unless otherwise indicated or unless the context requires otherwise, all references in this document to “we,”
“us,” “our,” or similar references are to BofA Finance, and not to BAC.
As a result
of the completion of the reorganization of Bank of America’s U.S. broker-dealer business, references to Merrill Lynch, Pierce,
Fenner & Smith Incorporated (“MLPF&S”) in the accompanying product supplement, prospectus supplement and prospectus,
as such references relate to MLPF&S’s institutional services, should now be read as references to BofAS.
The Notes
are our senior debt securities. Any payments on the Notes are fully and unconditionally guaranteed by BAC. The
Notes and the related guarantee are not insured by the Federal Deposit Insurance Corporation or secured by collateral. The
Notes will rank equally in right of payment with all of our other unsecured and unsubordinated obligations, and the related guarantee
will rank equally in right of payment with all of BAC’s other unsecured and unsubordinated obligations, except obligations
that are subject to any priorities or preferences by law. Any payments due on the Notes, including any repayment of the principal
amount, will be subject to the credit risk of BofA Finance, as issuer, and BAC, as guarantor.
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FIXED INCOME AUTO-CALLABLE YIELD NOTES | PS-25
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