Category: Issue Comments

GMP Capital Inc. has announced:

DIVIDENDS

The Company’s net working capital as at June 30, 2020 was $122.8 million. While this level of liquidity is sufficient to pay dividends, under Section 38(3) of the Business Corporations Act (Ontario), the Company’s governing corporate statute, the Company cannot pay a dividend if there are reasonable grounds for believing that the net realizable value of the Company’s assets would be less than the aggregate of its liabilities and its legal stated capital of all classes of shares (common and preferred).

Due to the current level of stated capital of the Company’s outstanding common and preferred shares, the Board of Directors has reasonable grounds to believe that this test would not be satisfied as at September 30, 2020, the date on which its quarterly preferred share dividend would normally be paid. As such the Company is suspending the dividends on its preferred shares. At its next meeting of common shareholders, the Company intends to seek the approval of its common shareholders to reduce the stated capital of the common shares to allow the Company to resume paying dividends, including accrued, unpaid dividends on the preferred shares.

Dividends on the outstanding preferred shares are cumulative and will continue to accrue in accordance with the rights, privileges, restrictions and conditions associated with each series of preferred shares.

Affected issues are GMP.PR.B and GMP.PR.C.

These issues have been on Review-Developing at DBRS for a long time, due to uncertainty regarding the proposed deal with Richardson GMP. It looks like the uncertainty became a lot more uncertain!

Of particular interest is the following quote (emphasis added):

At its next meeting of common shareholders, the Company intends to seek the approval of its common shareholders to reduce the stated capital of the common shares to allow the Company to resume paying dividends, including accrued, unpaid dividends on the preferred shares.

So there’s no indication as to how much of a reduction in stated capital the company will seek. A sharp reduction in stated capital at Aimia allowed the company to resume dividends on the common and to execute a Substantial Issuer Bid for that common, neither of which was good for the preferred shareholders.

Thanks to Assiduous Reader DR for bring this to my attention!

Bank of Montreal has announced (on July 27):

the applicable dividend rates for its Non-Cumulative 5-Year Rate Reset Class B Preferred Shares, Series 33 (Non-Viability Contingent Capital (NVCC)) (the “Preferred Shares Series 33”) and Non-Cumulative Floating Rate Class B Preferred Shares, Series 34 (Non-Viability Contingent Capital (NVCC)) (the “Preferred Shares Series 34”).

With respect to any Preferred Shares Series 33 that remain outstanding after August 25, 2020, commencing as of such date, holders thereof will be entitled to receive fixed rate non-cumulative preferential cash dividends on a quarterly basis, as and when declared by the Board of Directors of the Bank and subject to the provisions of the Bank Act (Canada). The dividend rate for the five-year period commencing on August 25, 2020, and ending on August 24, 2025, will be 3.054 per cent, being equal to the sum of the five-year Government of Canada bond yield as at July 27, 2020 (being the first business day following the dividend rate calculation date of July 26, 2020, established in the Preferred Shares Series 33 prospectus, which falls on a Sunday), plus 2.71 per cent, as determined in accordance with the terms of the Preferred Shares Series 33.

With respect to any Preferred Shares Series 34 that may be issued on August 25, 2020, holders thereof will be entitled to receive floating rate non-cumulative preferential cash dividends on a quarterly basis, calculated on the basis of the actual number of days elapsed in each quarterly floating rate period divided by 365, as and when declared by the Board of Directors of the Bank and subject to the provisions of the Bank Act (Canada). The dividend rate for the three-month period commencing on August 25, 2020, and ending on November 24, 2020, will be 2.878 per cent, being equal to the sum of the three-month Government of Canada Treasury bill yield as at July 27, 2020 (being the first business day following the dividend rate calculation date of July 26, 2020), plus 2.71 per cent, as determined in accordance with the terms of the Preferred Shares Series 34.

Beneficial owners of Preferred Shares Series 33 who wish to exercise their right of conversion should communicate as soon as possible with their broker or other nominee and ensure that they follow their instructions in order to ensure that they meet the deadline to exercise such right, which is 5:00 p.m. (EDT) on August 10, 2020.

Conversion enquiries should be directed to BMO’s Registrar and Transfer Agent, Computershare Trust Company of Canada, at 1-800-340-5021.

BMO.PR.Y is a FixedReset, 3.80%+271, that commenced trading 2015-6-5 after being announced 2015-5-27. Notice of extension was published 2020-6-29. The issue is tracked by HIMIPref™ and is assigned to the FixedReset (Discount) subindex.

Dundee Corporation has announced:

that it intends to commence a substantial issuer bid (the “Offer”) to purchase for cancellation from the holders thereof who choose to participate up to C$44,000,000 in value of its Cumulative 5-Year Rate Reset First Preference Shares, Series 2 in the capital of the Corporation (the “Series 2 Shares”). The Offer is being made by way of a modified Dutch auction”, which will allow holders who choose to participate in the Offer to individually select the price, within a price range of not less than C$16.00 and not more than C$18.50 per Series 2 Share (in increments of C$0.10 per Share), at which they will tender their Series 2 Shares to the Offer. Upon expiry of the Offer, the Corporation will determine the lowest purchase price (the “Purchase Price”) (which will not be less than C$16.00 and not more than C$18.50 per Series 2 Share) based on all tenders validly deposited and not properly withdrawn pursuant to the Offer that will allow it to purchase the maximum number of Series 2 Shares tendered to the Offer, having an aggregate purchase price not exceeding C$44,000,000.

In addition to the Purchase Price, Shareholders who have Series 2 Shares taken up and paid for by the Corporation pursuant to the Offer will be entitled to receive the portion of any quarterly cash dividend declared by the Board of Directors on such Series 2 Shares for the quarter ended September 30, 2020, with such portion of the quarterly cash dividend per Series 2 Share being equal to the amount obtained when the amount of any quarterly dividend that would otherwise have been payable in respect of the dividend period is multiplied by a fraction, the numerator of which is the number of calendar days in such dividend period that such Series 2 Share has been outstanding (to but excluding the date of being taken up) and the denominator of which is the number of calendar days in such dividend period. As an example, assuming the Offer expires on August 27, 2020, the Series 2 Shares are taken up and paid for by the Corporation on August 31, 2020 and a dividend consistent with the prior quarter was declared on the Series 2 Shares, the accrued dividend amount payable per Series 2 Share validly tendered, taken up and paid for under the Offer is estimated to be approximately C$0.22.

The Offer will expire at 5:00 p.m. (Toronto time) on August 27, 2020 or such later time and date to which the Offer may be extended by Dundee, unless varied or withdrawn by Dundee.
…
“In this current and ongoing low interest rate environment we believe this is an effective way to lower our cost of capital and reduce our overall cash outflows by purchasing the more expensive Series 2 Shares tendered as part of this Offer compared to the Series 3 Shares,” said Robert Sellars, Executive Vice President and Chief Financial Officer.

The Board of Directors of the Corporation will continue to review various options for the allocation of capital, including any portion of the C$44,000,000 under the Offer remaining in excess of the aggregate purchase price payable pursuant to the Offer, with such options including, but not limited to, further repurchases of the Corporation’s securities, including without limitation, its Class A Subordinate Voting Shares and Cumulative Floating Rate First Preference Shares, Series 3 (“Series 3 Shares”). Throughout 2019 and during 2020 to date, the Corporation has continued to implement its strategy of rationalizing its portfolio of investments and monetizing non-core assets as it exits business lines which are no longer deemed to be aligned with its longer-term strategy, while remaining committed to creating value for the Corporation and considering opportunities that might present themselves, including potential returns to shareholders of the Corporation. In line with the Corporation’s longer-term strategy and commitment to creating value for the Corporation, the Board believes that the purchase of Series 2 Shares under the Offer represents an attractive investment opportunity for Dundee and will be welcomed by certain holders of Series 2 Shares who may wish to reduce their share ownership positions.

Additional Details of the Offer

If the Purchase Price is determined to be C$16.00 per Series 2 Share (which is the minimum Purchase Price under the Offer), the maximum number of Series 2 Shares that may be purchased by the Corporation under the Offer is 2,750,000 Series 2 Shares, which represents approximately 88.25% of the Series 2 Shares issued and outstanding as at July 21, 2020. If the Purchase Price is determined to be C$18.50 per Series 2 Share (which is the maximum Purchase Price under the Offer), the maximum number of Series 2 Shares that may be purchased by the Corporation under the Offer is 2,378,378 Series 2 Shares, which represents approximately 76.33% of the Series 2 Shares issued and outstanding as at July 21, 2020.

If Series 2 Shares with an aggregate purchase price of more than C$44,000,000 are properly tendered and not properly withdrawn, the Corporation will purchase the Series 2 Shares on a pro rata basis after giving effect to “odd lot” tenders (of holders beneficially owning fewer than 100 Series 2 Shares), which will not be subject to pro-ration. In that case, all Series 2 Shares tendered at or below the finally determined Purchase Price will be purchased, subject to pro-ration, at the same Purchase Price determined pursuant to the terms of the Offer. Series 2 Shares that are not purchased, including all Series 2 Shares tendered pursuant to auction tenders at prices above the Purchase Price, will be returned to shareholders.

The Offer and all deposits of Series 2 Shares are subject to the terms and conditions set forth in the offer to purchase, the accompanying issuer bid circular and the related letter of transmittal and notice of guaranteed delivery (all such documents, as amended or supplemented from time to time, collectively constitute and are herein referred to as, the “Offer Documents”). Further details of the Offer, including the terms and conditions thereof and instructions for tendering Series 2 Shares, are included in the Offer Documents. The Offer Documents will be mailed to shareholders, filed with the applicable Canadian securities regulatory authorities and made available without charge on SEDAR at www.sedar.com in accordance with applicable securities laws, as well as being posted on the Corporation’s website at www.dundeecorp.com, on the date of this news release.

As at July 21, 2020, the Corporation had 3,115,978 Series 2 Shares issued and outstanding. The Series 2 Shares are listed and posted for trading on the Toronto Stock Exchange (the “TSX”) under the symbol “DC.PR.B”. On July 21, 2020, the last full trading day prior to the day the terms of the Offer were publicly announced, the closing price of the Series 2 Shares on the TSX was C$16.26.

The Corporation expects to fund any purchases of Series 2 Shares under the Offer using the Corporation’s available cash on hand. All Series 2 Shares purchased by the Corporation under the Offer will be cancelled.

The Offer is not conditional upon any minimum number of Series 2 Shares being deposited. However, the Offer is subject to certain conditions that are customary for transactions of this nature.

…

DC.PR.B closed at 17.75 today, near the top of the range for the offer and up 9.16% on the day.

There was a very long thread of comments about Dundee and its preferreds on an unrelated thread in mid-May, 2020.

I find it fascinating that they are leaving the issue’s FloatingReset counterparts, DC.PR.D, out of the offer. The dividend on DC.PR.D is a little more than that of DC.PR.B at the moment ($0.35777 vs. $0.33025 as of June 4, according to their recent dividend announcement) although I confess I don’t quite see how that works, given that the five-year Canada yield was well above 1% at the end of August, 2019, when the reset rate was calculated. Regardless, I would have thought that the additional offerings they would get by taking the DC.PR.D on equal terms (or maybe at some discount) with DC.PR.B would lower the total price sufficiently to outweigh any such short-term concerns.

Update2020-7-24: Regarding the dividend rate on DC.PR.D … the quarterly period ending June 30 commenced on the last day of March, 2020, and the rate was calculated 30 days prior to this. The Bank of Canada reports a 3-Month T-Bill yield of 1.61% on February 26, and 1.14% on March 4, 2020, before dropping even further, so the dividend quoted for the Series 3, DC.PR.D, is not unreasonable. The next one will be a lot lower!

DC.PR.B is a FixedReset, 5.688%+410, that commenced trading 2009-9-15 with a 6.75% coupon after being announced 2009-8-25. It reset to 5.688% effective 2014-09-30. I made no recommendation regarding conversion. Now, DC.PR.B will reset at 5.284% effective September 30, 2019. I recommended retaining, or converting to, DC.PR.B. Instead, there was a small net conversion to DC.PR.D leaving DC.PR.B with about 61% of the total. The issue is tracked by HIMIPref™ but is relegated to the Scraps – FixedReset (Discount) subindex on credit concerns.

DC.PR.D is a FloatingReset, +410, that came into existence via a partial conversion from DC.PR.B. It is tracked by HIMIPref™ but relegated to the Scraps – FloatingReset subindex on credit concerns.

Canadian Imperial Bank of Commerce has announced:

that, during the conversion notice period which ran from July 1, 2020 to July 16, 2020, 106,305 Non-cumulative Rate Reset Class A Preferred Shares Series 43 (Non-Viability Contingent Capital (NVCC)) of CIBC (the “Series 43 Shares”) were tendered for conversion, on a one-for-one basis, into Non-cumulative Floating Rate Class A Preferred Shares Series 44 (Non-Viability Contingent Capital (NVCC)) of CIBC (the “Series 44 Shares”). As per the conditions set out in the prospectus supplement dated February 27, 2015 relating to the issuance of the Series 43 Shares, since less than 1,000,000 Series 44 Shares would be outstanding on July 31, 2020, holders of Series 43 Shares who tendered their Series 43 Shares for conversion will not be entitled to convert their shares into Series 44 Shares. As a result, Series 44 Shares will not be issued at this time.

On July 31, 2020, CIBC will have 12,000,000 Series 43 Shares issued and outstanding. The Series 43 Shares are currently listed on the Toronto Stock Exchange under the symbol CM.PR.Q.

The fixed dividend rate applicable to the Series 43 Shares for the five-year period from and including July 31, 2020 to but excluding July 31, 2025 is 3.143%, payable quarterly as and when declared by the Board of Directors of CIBC.

CM.PR.Q is a FixedReset, 3.60%+279, that commenced trading 2015-3-11 after being announced 2015-2-26. It will reset to 3.143% effective 2020-7-31. The issue is tracked by HIMIPref™ and is assigned to the FixedResets (Discount) subindex.

Bank of Montreal has announced (on June 29):

that it does not intend to exercise its right to redeem the currently outstanding Non-Cumulative 5-Year Rate Reset Class B Preferred Shares, Series 33 (Non-Viability Contingent Capital (NVCC)) of the Bank (the “Preferred Shares Series 33”) on August 25, 2020. As a result, subject to certain conditions, the holders of Preferred Shares Series 33 have the right, at their option, to convert all or part of their Preferred Shares Series 33 on a one-for-one basis into Non-Cumulative Floating Rate Class B Preferred Shares, Series 34 (Non-Viability Contingent Capital (NVCC)) of the Bank (the “Preferred Shares Series 34”) on August 25, 2020. Holders who do not exercise their right to convert their Preferred Shares Series 33 into Preferred Shares Series 34 on such date will retain their Preferred Shares Series 33, unless automatically converted in accordance with the conditions below.

The foregoing conversions are subject to the conditions that: (i) if, after August 10, 2020, the Bank determines that there would be less than 1,000,000 Preferred Shares Series 33 outstanding on August 25, 2020, then all remaining Preferred Shares Series 33 will automatically be converted into an equal number of Preferred Shares Series 34 on August 25, 2020; and (ii) alternatively, if the Bank determines that there would be less than 1,000,000 Preferred Shares Series 34 outstanding on August 25, 2020, no Preferred Shares Series 33 will be converted into Preferred Shares Series 34. In either case, the Bank will give written notice to that effect to any registered holders of Preferred Shares Series 33 affected by the preceding minimums on or before August 14, 2020.

The dividend rate applicable to the Preferred Shares Series 33 for the 5-year period commencing on August 25, 2020, and ending on August 24, 2025, and the dividend rate applicable to the Preferred Shares Series 34 for the 3-month period commencing on August 25, 2020, and ending on November 24, 2020, will be determined and announced by way of a news release on July 27, 2020. This date is the first business day following the dividend rate calculation date of July 26, 2020, established in the Preferred Shares Series 33 prospectus, which falls on a Sunday. The Bank will also give written notice of these dividend rates to the registered holders of Preferred Shares Series 33.

Beneficial owners of Preferred Shares Series 33 who, on or after July 27, 2020, wish to exercise their right of conversion should instruct their broker or other nominee to exercise such right before 5:00 p.m. (EDT) on August 10, 2020.

Conversion inquiries should be directed to BMO’s Registrar and Transfer Agent, Computershare Trust Company of Canada, at 1-800-340-5021.

BMO.PR.Y is a FixedReset, 3.80%+271, that commenced trading 2015-6-5 after being announced 2015-5-27. It is tracked by HIMIPref™ and is been assigned to the FixedReset (Discount) subindex.

Emera Incorporated has announced:

the applicable dividend rates for its Cumulative Rate Reset First Preferred Shares, Series A (the “Series A Shares”) and Cumulative Floating Rate First Preferred Shares, Series B (the “Series B Shares”), in each case, payable if, as and when declared by the Board of Directors of the Company:

2.182% per annum on the Series A Shares ($0.1364 per Series A Share per quarter), being equal to the sum of the Government of Canada bond yield as at July 16, 2020, plus 1.84%, payable quarterly on the 15th of February, May, August and November of each year during the five-year period commencing on August 15, 2020 and ending on (and inclusive of) August 14, 2025; and
2.021% on the Series B Shares for the three-month period commencing on August 15, 2020 and ending on (and inclusive of) November 14, 2020 ($0.1274 per Series B Share for the quarter), being equal to the sum of the three-month Government of Canada treasury bill yield rate as at July 16, 2020, plus 1.84% (calculated on the basis of the actual number of days elapsed during the quarter divided by 365), payable on the 15th of November 2020. The quarterly floating dividend rate will be reset every quarter.
Subject to certain conditions set out in the prospectus supplement of the Company dated May 26, 2010, to the short form base shelf prospectus of the Company dated May 19, 2010 (collectively, the “Prospectus”), on August 15, 2020 (the “Conversion Date”):

(a) The holders of Series A Shares have the right, at their option:

To retain any or all of their Series A Shares and continue to receive a fixed rate quarterly dividend; or
To convert any or all of their Series A Shares, on a one-for-one basis, into Series B Shares and receive a floating rate quarterly dividend, and
(b) The holders of Series B Shares have the right, at their option:

To retain any or all of their Series B Shares and continue to receive a floating rate quarterly dividend; or
To convert any or all of their Series B Shares, on a one-for-one basis, into Series A Shares and receive a fixed rate quarterly dividend.
The conversion of Series A Shares is subject to the conditions that: (i) if the Company determines, after having taken into account all shares tendered for conversion by holders of Series A Shares that there would remain outstanding on such Conversion Date less than 1,000,000 Series A Shares, such remaining number of Series A Shares will automatically be converted into Series B Shares on a one-for-one basis on such Conversion Date, and (ii) alternatively, if the Company determines that, after conversion, there would remain outstanding on such Conversion Date less than 1,000,000 Series B Shares, then no Series A Shares will be converted into Series B Shares.

The conversion of Series B Shares is subject to the conditions that: (i) if the Company determines, after having taken into account all shares tendered for conversion by holders of Series B Shares that there would remain outstanding on such Conversion Date less than 1,000,000 Series B Shares, such remaining number of Series B Shares will automatically be converted into Series A Shares on a one-for-one basis on such Conversion Date, and (ii) alternatively, if the Company determines that, after conversion, there would be outstanding on such Conversion Date less than 1,000,000 Series A Shares, then no Series B Shares will be converted into Series A Shares.

In either case, the Company will give written notice to that effect to the holders of Series A Shares and the holders of Series B Shares at least seven days prior to the Conversion Date.

Beneficial owners of Series A Shares or Series B Shares who wish to exercise their conversion right should communicate with their broker or other nominee to obtain instructions for exercising such right during the conversion period, which runs from July 16, 2020 until the deadline of 5:00 p.m. (Toronto Time) on July 31, 2020. Any notices received after this deadline will not be valid. As such, it is recommended that this be done well in advance of the deadline in order to provide their broker or other nominee with adequate time to complete the necessary steps.

Holders of Series A Shares and Series B Shares will have the opportunity to convert their shares again on August 15, 2025 and every five years thereafter as long as the shares remain outstanding. For more information on the terms of, and risks associated with, an investment in Series A Shares and Series B Shares, please see the Company’s Prospectus, which is available on www.sedar.com.

EMA.PR.A was issued as a FixedReset, 4.40%+184, that commenced trading 2010-6-2 after being announced 2010-5-25. Extension was announced in 2015 and a reset to 2.555% announced. I receommended against conversion, but there was a 36% conversion to EMA.PR.B anyway. Notice of extension was provided on 2020-7-9.

EMA.PR.B is a FloatingReset, Bills+184, that became extant in 2015 via a 36% conversion from EMA.PR.A.

The Toronto-Dominion Bank has announced:

that none of its 14 million Non-Cumulative 5-Year Rate Reset Preferred Shares, Series 7 (Non-Viability Contingent Capital (NVCC)) (the “Series 7 Shares”) will be converted on July 31, 2020 into Non-Cumulative Floating Rate Preferred Shares, Series 8 (NVCC) (the “Series 8 Shares”) of TD.

During the conversion period, which ran from July 2, 2020 to July 16, 2020, 119,697 Series 7 Shares were tendered for conversion into Series 8 Shares, which is less than the minimum 1,000,000 shares required to give effect to the conversion, as described in the prospectus supplement for the Series 7 Shares dated March 3, 2015. As a result, no Series 8 Shares will be issued on July 31, 2020 and holders of Series 7 Shares will retain their Series 7 Shares.

The Series 7 Shares are currently listed on the Toronto Stock Exchange under the symbol TD.PF.D. As previously announced on July 2, 2020, the dividend rate for the Series 7 Shares for the 5 year period from and including July 31, 2020 to but excluding July 31, 2025 will be 3.201%.

TD.PF.D is a FixedReset, 3.60%+279, that commenced trading 2015-3-10 after being announced 2015-2-27. Notice of extension was provided on 2020-6-18. The issue will reset at 3.201% effective 2020-7-31. The issue is NVCC-compliant, is tracked by HIMIPref™ and is assigned to the FixedReset (Discount) subindex.

Emera Incorporated has announced:

that it does not intend to exercise its right to redeem all or any part of the currently outstanding Cumulative Rate Reset First Preferred Shares, Series A (the “Series A Shares”) or the Cumulative Floating Rate First Preferred Shares, Series B (the “Series B Shares”) of the Company on August 15, 2020. There are currently 3,864,636 Series A Shares and 2,135,364 Series B Shares outstanding.

As a result, subject to certain conditions set out in the prospectus supplement of the Company dated May 26, 2010, to the short form base shelf prospectus of the Company dated May 19, 2010 (collectively, the “Prospectus”), on August 15, 2020 (the “Conversion Date”):

(a) The holders of Series A Shares have the right, at their option:

To retain any or all of their Series A Shares and continue to receive a fixed rate quarterly dividend; or
To convert any or all of their Series A Shares, on a one-for-one basis, into Series B Shares and receive a floating rate quarterly dividend, and
(b) The holders of Series B Shares have the right, at their option:

To retain any or all of their Series B Shares and continue to receive a floating rate quarterly dividend; or
To convert any or all of their Series B Shares, on a one-for-one basis, into Series A Shares and receive a fixed rate quarterly dividend.
The conversion of Series A Shares is subject to the conditions that: (i) if the Company determines, after having taken into account all shares tendered for conversion by holders of Series A Shares that there would remain outstanding on such Conversion Date less than 1,000,000 Series A Shares, such remaining number of Series A Shares will automatically be converted into Series B Shares on a one-for-one basis on such Conversion Date, and (ii) alternatively, if the Company determines that, after conversion, there would remain outstanding on such Conversion Date less than 1,000,000 Series B Shares, then no Series A Shares will be converted into Series B Shares.

The conversion of Series B Shares is subject to the conditions that: (i) if the Company determines, after having taken into account all shares tendered for conversion by holders of Series B Shares that there would remain outstanding on such Conversion Date less than 1,000,000 Series B Shares, such remaining number of Series B Shares will automatically be converted into Series A Shares on a one-for-one basis on such Conversion Date, and (ii) alternatively, if the Company determines that, after conversion, there would be outstanding on such Conversion Date less than 1,000,000 Series A Shares, then no Series B Shares will be converted into Series A Shares.

In either case, Emera will give written notice to that effect to the holders of Series A Shares and the holders of Series B Shares at least seven days prior to the Conversion Date.

The dividend rate applicable for the Series A Shares for the five-year period commencing on August 15, 2020 and ending on (and inclusive of) August 14, 2025, and the dividend rate applicable to the Series B Shares for the 3-month period commencing on August 15, 2020 and ending on (and inclusive of) November 14, 2020, will be determined on July 16, 2020. Notice of such dividend rates shall be provided to the holders of the Series A Shares and the holders of the Series B Shares on that day.

Beneficial owners of Series A Shares or Series B Shares who wish to exercise their conversion right should communicate with their broker or other nominee to obtain instructions for exercising such right during the conversion period, which runs from July 16, 2020 until the deadline of 5:00 p.m. (Toronto Time) on July 31, 2020. Any notices received after this deadline will not be valid. As such, it is recommended that this be done well in advance of the deadline in order to provide their broker or other nominee with adequate time to complete the necessary steps.

Beneficial owners of Series A Shares who do not provide notice or communicate with their broker or other nominee by the deadline will retain their Series A Shares and receive the new annual fixed dividend rate applicable to the Series A Shares, subject to the conditions stated above. Beneficial owners of Series B Shares who do not provide notice or communicate with their broker or other nominee by the deadline will retain their Series B Shares and receive the floating rate quarterly dividend applicable to the Series B Shares, subject to the conditions stated above.

Holders of Series A Shares and Series B Shares will have the opportunity to convert their shares again on August 15, 2025 and every five years thereafter as long as the shares remain outstanding. For more information on the terms of, and risks associated with, an investment in Series A Shares and Series B Shares, please see the Company’s Prospectus, which is available on www.sedar.com.

EMA.PR.A was issued as a FixedReset, 4.40%+184, that commenced trading 2010-6-2 after being announced 2010-5-25. Extension was announced in 2015 and a reset to 2.555% announced. I receommended against conversion, but there was a 36% conversion to EMA.PR.B anyway.

EMA.PR.B is a FloatingReset, Bills+184, that became extant in 2015 via a 36% conversion from EMA.PR.A.

The Toronto-Dominion Bank has announced:

the applicable dividend rates for its Non-Cumulative 5-Year Rate Reset Preferred Shares, Series 7 (Non-Viability Contingent Capital (NVCC)) (the “Series 7 Shares”) and Non-Cumulative Floating Rate Preferred Shares, Series 8 (NVCC) (the “Series 8 Shares”).

With respect to any Series 7 Shares that remain outstanding after July 31, 2020, holders of the Series 7 Shares will be entitled to receive quarterly fixed non-cumulative preferential cash dividends, as and when declared by the Board of Directors of TD, subject to the provisions of the Bank Act (Canada). The dividend rate for the 5-year period from and including July 31, 2020 to but excluding July 31, 2025 will be 3.201%, being equal to the 5-Year Government of Canada bond yield determined as at July 2, 2020 plus 2.79%, as determined in accordance with the terms of the Series 7 Shares.

With respect to any Series 8 Shares that may be issued on July 31, 2020, holders of the Series 8 Shares will be entitled to receive quarterly floating rate non-cumulative preferential cash dividends, calculated on the basis of the actual number of days elapsed in such quarterly period divided by 365, as and when declared by the Board of Directors of TD, subject to the provisions of the Bank Act (Canada). The dividend rate for the floating rate period from and including July 31, 2020 to but excluding October 31, 2020, will be 2.999%, being equal to the 90-day Government of Canada Treasury Bill yield determined as of July 2, 2020 plus 2.79%, as determined in accordance with the terms of the Series 8 Shares.

Beneficial owners of Series 7 Shares who wish to exercise their conversion right should communicate as soon as possible with their broker or other nominee to obtain instructions for exercising such right on or prior to the deadline for exercise, which is 5:00 p.m. (Toronto time) on July 16, 2020.

Inquiries should be directed to TD’s Registrar and Transfer Agent, AST Trust Company (Canada), at 1-800-387-0825 (or in Toronto 416-682-3860).

TD.PF.D is a FixedReset, 3.60%+279, that commenced trading 2015-3-10 after being announced 2015-2-27. Notice of extension was provided on 2020-6-18. The issue is NVCC-compliant, is tracked by HIMIPref™ and is assigned to the FixedReset (Discount) subindex.

The Toronto-Dominion Bank has announced (on June 18):

that it does not intend to exercise its right to redeem all or any part of the currently outstanding 14 million Non-Cumulative 5-Year Rate Reset Preferred Shares, Series 7 (Non-Viability Contingent Capital (NVCC)) (the “Series 7 Shares”) of TD on July 31, 2020. As a result and subject to certain conditions set out in the prospectus supplement dated March 3, 2015 relating to the issuance of the Series 7 Shares, the holders of the Series 7 Shares have the right to convert all or part of their Series 7 Shares, on a one-for-one basis, into Non-Cumulative Floating Rate Preferred Shares, Series 8 (NVCC) (the “Series 8 Shares”) of TD on July 31, 2020. Holders who do not exercise their right to convert their Series 7 Shares into Series 8 Shares on such date will continue to hold their Series 7 Shares.

The foregoing conversion right is subject to the conditions that: (i) if TD determines that there would be less than 1,000,000 Series 8 Shares outstanding after taking into account all shares tendered for conversion on July 31, 2020, then holders of Series 7 Shares will not be entitled to convert their shares into Series 8 Shares, and (ii) alternatively, if TD determines that there would remain outstanding less than 1,000,000 Series 7 Shares after taking into account all shares tendered for conversion on July 31, 2020, then all remaining Series 7 Shares will automatically be converted into Series 8 Shares on a one-for-one basis on July 31, 2020. In either case, TD will give written notice to that effect to holders of Series 7 Shares no later than July 24, 2020.

The dividend rate applicable to the Series 7 Shares for the 5-year period from and including July 31, 2020 to but excluding July 31, 2025, and the dividend rate applicable to the Series 8 Shares for the 3-month period from and including July 31, 2020 to but excluding October 31, 2020, will be determined and announced by way of a press release on July 2, 2020.

Beneficial owners of Series 7 Shares who wish to exercise their conversion right should communicate as soon as possible with their broker or other nominee to obtain instructions for exercising such right during the conversion period, which runs from July 2, 2020 until 5:00 p.m. (Toronto time) on July 16, 2020.

Inquiries should be directed to TD’s Registrar and Transfer Agent, AST Trust Company (Canada), at 1-800-387-0825 (or in Toronto 416-682-3860).

TD.PF.D is a FixedReset, 3.60%+279, that commenced trading 2015-3-10 after being announced 2015-2-27. It is NVCC-compliant and is tracked by HIMIPref™ and is assigned to the FixedReset (Discount) subindex.