One year ago, Warren Buffett took an eventful bath. The result: A brainstorm that led to a $5 billion investment in Bank of America.
After deliberating for a day, Bank of America chief executive Brian Moynihan agreed to let Buffett buy 50,000 shares of cumulative preferred equity that would cash out at $100,000 a share.
The stock will pay a 6 percent dividend, or $300 million, annually. Should Buffett want to cash out at any time, Bank of America will pay him a 5 percent, or $250 million, premium on the buyback. (Read More:Bank of America vice chairman, a former CFO, to retire in September.)