that it has notified registered shareholders of its Cumulative Rate Reset Preference Shares, Series 5 (Series 5 Shares) (TSX: CPX.PR.E) of the Conversion Privilege and Dividend Rate Notice.
Subject to certain conditions, beginning on May 31, 2023 and ending at 5:00 p.m. (Toronto time) on June 15, 2023, each registered holder of Series 5 Shares will have the right to elect to convert any or all of their Series 5 Shares into an equal number of Cumulative Floating Rate Preference Shares, Series 6 (Series 6 Shares) by delivering an Election Notice to the Corporation.
If Capital Power does not receive an Election Notice from a holder of Series 5 Shares during the time fixed therefor, then the Series 5 Shares shall be deemed not to have been converted (except in the case of an Automatic Conversion, see below). Holders of the Series 5 Shares and the Series 6 Shares will have the opportunity to convert their shares again on June 30, 2028, and every five years thereafter as long as the shares remain outstanding.
Effective June 30, 2023, on May 31, 2023, the Annual Fixed Dividend Rate for the Series 5 Shares was set for the next five-year period at 6.63100%. Effective June 30, 2023, on May 31, 2023, the Floating Quarterly Dividend Rate for the Series 6 Shares was set for the first Quarterly Floating Rate Period (being the period from and including June 30, 2023, to but excluding September 30, 2023) at 1.94410%. The Floating Quarterly Dividend Rate will be reset every quarter.
The Series 5 Shares are issued in “book entry only” form and, as such, the sole registered holder of the Series 5 Shares is CDS Clearing and Depository Services Inc. (CDS). All rights of beneficial holders of Series 5 Shares must be exercised through CDS or the CDS participant through which the Series 5 Shares are held. The deadline for the registered shareholder to provide notice of exercise of the right to convert Series 5 Shares into Series 6 Shares is 3:00 p.m. (MT) / 5:00 p.m. (ET) on June 15, 2023. Any Election Notices received after this deadline will not be valid. As such, beneficial holders of Series 5 Shares who wish to exercise their rights to convert their shares should contact their broker or other intermediary for more information and it is recommended that this be done well in advance of the deadline in order to provide the broker or other intermediary with time to complete the necessary steps.
After June 15, 2023, (i) if Capital Power determines that there would remain outstanding on June 30, 2023, less than 1,000,000 Series 5 Shares, all remaining Series 5 Shares will be automatically converted into Series 6 Shares on a one-for-one basis effective June 30, 2023 (an Automatic Conversion); or (ii) if Capital Power determines that there would remain outstanding after June 30, 2023, less than 1,000,000 Series 6 Shares, no Series 5 Shares will be permitted to be converted into Series 6 Shares effective June 30, 2023. There are currently 8,000,000 Series 5 Shares outstanding.
The Toronto Stock Exchange (TSX) has conditionally approved the listing of the Series 6 Shares effective upon conversion. Listing of the Series 6 Shares is subject to the Capital Power fulfilling all the listing requirements of the TSX and upon approval, the Series 6 Shares will be listed on the TSX under the trading symbol CPX.PR.F.
For more information on the terms of, rates and risks associated with an investment in, the Series 5 Shares and the Series 6 Shares, please see Capital Power’s prospectus supplement dated March 7, 2013 which is available on sedar.com or on Capital Power’s website at capitalpower.com.
CPX.PR.E To Reset To 6.631%
Capital Power Corporation has announced:
CPX.PR.E was issued as a FixedReset, 4.50%+315, that commenced trading 2013-3-14 after being announced 2013-3-5. The issue reset to 5.238% in 2018 and there was no conversion. It is tracked by HIMIPref™ but relegated to the Scraps subindex on credit concerns.
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