PrefBlog

The Toronto-Dominion Bank has announced (press release dated 2024-09-23):

that it does not intend to exercise its right to redeem all or any part of the currently outstanding 20,000,000 Non-Cumulative 5-Year Rate Reset Class A First Preferred Shares, Series 1 (Non-Viability Contingent Capital (NVCC)) (the “Series 1 Shares”) of TD on October 31, 2024. As a result and subject to certain conditions set out in the prospectus supplement dated May 28, 2014 relating to the issuance of the Series 1 Shares, the holders of the Series 1 Shares have the right to convert all or part of their Series 1 Shares, on a one-for-one basis, into Non-Cumulative Floating Rate Class A First Preferred Shares, Series 2 (Non-Viability Contingent Capital (NVCC)) (the “Series 2 Shares”) of TD on October 31, 2024. Holders who do not exercise their right to convert their Series 1 Shares into Series 2 Shares on such date will continue to hold their Series 1 Shares, subject to the conditions described below.

The foregoing conversion right is subject to the conditions that: (i) if TD determines that there would be less than 1,000,000 Series 2 Shares outstanding after taking into account all shares tendered for conversion on October 31, 2024, then holders of Series 1 Shares will not be entitled to convert their shares into Series 2 Shares, and (ii) alternatively, if TD determines that there would remain outstanding less than 1,000,000 Series 1 Shares after taking into account all shares tendered for conversion on October 31, 2024, then all remaining Series 1 Shares will automatically be converted into Series 2 Shares on a one-for-one basis on October 31, 2024. In either case, TD will give written notice to that effect to holders of Series 1 Shares no later than October 24, 2024.

The dividend rate applicable to the Series 1 Shares for the 5-year period from and including October 31, 2024 to but excluding October 31, 2029, and the dividend rate applicable to the Series 2 Shares for the 3-month period from and including October 31, 2024 to but excluding January 31, 2025, will be determined and announced by way of a press release on October 1, 2024.

Beneficial owners of Series 1 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 October 1, 2024 until 5:00 p.m. (Toronto time) on October 16, 2024.

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

TD.PF.A was issued as a FixedReset, 3.90%+224, NVCC-compliant issue that commenced trading 2014-6-4 after being announced 2014-5-26. TD.PF.A reset at 3.662% effective October 31, 2019. I recommended against conversion and there was no conversion. It is tracked by HIMIPref™ and is assigned to the FixedReset – Discount subindex.

The extension caused shock and consternation in the market today: the issue closed 9/23 at 24.52 and today at 22.73, down 7.30%. TD.PF.C, which resets 2025-1-31 closed 9/23 at 23.96 and today at 22.71, down 5.21%. There were a fair number of bets that redemption was in the cards!

Thanks to Assiduous Reader niagara for bringing this to my attention!

This entry was posted on Tuesday, September 24th, 2024 at 8:26 pm and is filed under Issue Comments. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.