Capstone Infrastructure Corporation has announced:
today the applicable dividend rates for its Cumulative 5-Year Rate Reset Preferred Shares, Series A (the “Series A shares”) and Cumulative Floating Rate Preferred Shares, Series B (the “Series B shares”) that will take effect on July 31, 2026.
With respect to any Series A shares that remain outstanding after July 31, 2026 (when, subject to the terms of the Corporation’s articles, holders of Series A shares who elect to exchange some or all of their Series A shares for Series B shares will have such shares exchanged) (the “Conversion Date”), holders of Series A shares will be entitled to receive quarterly fixed cumulative preferential cash dividends, if, as and when declared by the Board of Directors of Capstone. The dividend rate for the five-year period from and including July 31, 2026 to but excluding July 31, 2031 will be 5.788% per annum, being equal to the five-year Government of Canada bond yield determined as of today plus 2.71%, in accordance with the terms of the Series A shares.
With respect to any Series B shares that may be issued on the Conversion Date, holders thereof will be entitled to receive quarterly floating rate cumulative preferential cash dividends, if, as and when declared by the Board of Directors of Capstone. The dividend rate for the three-month period from and including July 31, 2026 to but excluding October 31, 2026 will be 4.994% per annum, being equal to the three-month Government of Canada Treasury Bill yield per annum determined as of today plus 2.71%, with the amount of any quarterly dividend calculated based on the actual number of days in such quarterly period divided by 365, in accordance with the terms of the Series B shares.
Beneficial owners of Series A shares who wish to exercise their conversion right should communicate with their broker or other nominee to ensure their instructions are followed so that the registered holder of the Series A shares can meet the deadline to exercise such conversion right, which is 5:00 p.m. (Toronto time) on July 15, 2026.
CSE.PR.A was issued as a FixedReset, 5.00%+271, that commenced trading 2011-6-30 after being announced 2011-6-13. Notice of extension was provided and it reset to 3.271% in 2016. I recommended against conversion and there was no conversion to FloatingReset. The issue reset to 3.702% in 2021; there was no conversion. Extension notice was provided in 2026. The issue is now unrated.