Capital Power Corporation Preferred shares

5.238% Cumulative Rate Reset Preference Shares, Series 5

Toronto Stock Exchange (TSX) ticker symbol: CPX.PR.E
Date of TSX Listing: March 14, 2013
Shares Outstanding: 8,000,000
CUSIP: 14042M706

Preferred Shares (Series 5) conversion privilege and dividend rate notice

On May 31, 2018, Capital Power notified registered shareholders of the Company’s Cumulative 5-Year Rate Reset Preference Shares, Series 5 (Series 5 Shares) of the conversion privilege and dividend rate notice. Series 5 shareholders had 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). Following the conversion deadline on June 15, 2018, approximately 236,824 Series 5 Shares were tendered for conversion, which was less than the one million shares required for conversion into Series 6 Shares. Accordingly, 8,000,000 Series 5 Shares remain outstanding and there were no Series 6 Shares issued as at June 30, 2018. Effective June 30, 2018, the Annual Fixed Dividend Rate for the Series 5 Shares for the next five year period was reset to 5.23800% from 4.50%.

 

Summary

Issue Description Ticker Symbol Par Dividend per Share per Annum Dividend Payable Dates Key Terms
Series 5 Cumulative Rate Reset CPX.PR.E $25.00 $1.3095 Last business day of March, June, September and December Dividend rate was reset on June 30, 2018 and every five years thereafter at a rate equal to the sum of the then five-year Government of Canada bond yield and 3.15%. The Series 5 Shares are redeemable by Capital Power, at its option, on June 30, 2018 and on June 30 of every fifth year thereafter.

 

Dividends Declared

Declaration Date Record Date Dividend Payment Date Dividend Amount per Share
April 26, 2019 June 17, 2019 June 28, 2019 $0.327375
February 15, 2019 March 18, 2019 March 29, 2019 $0.327375
October 26, 2018 December 14, 2018 December 31, 2018 $0.327375
July 30, 2018 September 17, 2018 September 28, 2018 $0.327375
April 27, 2018 June 18, 2018 June 29, 2018 $0.28125
February 15, 2018 March 16, 2018 March 29, 2018 $0.28125
November 16, 2017 December 14, 2017 December 29, 2017 $0.28125
July 26, 2017 September 18, 2017 September 29, 2017 $0.28125
April 28, 2017 June 19, 2017 June 30, 2017 $0.28125
February 17, 2017 March 20, 2017 March 31, 2017 $0.28125
November 17, 2016 December 15, 2016 December 30, 2016 $0.28125
July 25, 2016 September 19, 2016 September 30, 2016 $0.28125
April 22, 2016 June 17, 2016 June 30, 2016 $0.28125
February 18, 2016 March 17, 2016 March 31, 2016 $0.28125
November 18, 2015 December 16, 2015 December 31, 2015 $0.28125
July 27, 2015 September 17, 2015 September 30, 2015 $0.28125
April 24, 2015 June 17, 2015 June 30, 2015 $0.28125
February 25, 2015 March 18, 2015 March 31, 2015 $0.28125
November 20, 2014 December 16, 2014 December 31,2014 $0.28125
July 25, 2014 September 17, 2014 September 30, 2014 $0.28125
April 25, 2014 June 17, 2014 June 30, 2014 $0.28125
February 28, 2014 March 18, 2014 March 31, 2014 $0.28125
November 20, 2013 December 16, 2013 December 31, 2013 $0.28125
July 26, 2013 September 17, 2013 September 30, 2013 $0.28125
April 26, 2013 June 17, 2013 June 28, 2013 $0.3329(1)
(1)The initial dividend on the Series 5 Cumulative Rate Reset Shares represents the time period from when the initial share offering closed on March 14, 2013 to June 30, 2013. Future quarterly dividends, if declared, will be $0.28125 per quarter or $1.125 per annum for the initial five-year period ending June 30, 2018.

 

Excerpt from Prospectus Supplement

The holders of the Series 5 Shares will be entitled to receive fixed cumulative preferential cash dividends, if, as and when declared by the board of directors of the Corporation (the “Board of Directors”), payable quarterly on the last business day of each of March, June, September and December at an annual rate of $1.125 per Series 5 Share for the initial period from and including the Closing Date to but excluding June 30, 2018 (the “Initial Fixed Rate Period”). The initial dividend, if declared, will be payable on June 28, 2013 and will be $0.3329 per Series 5 Share, based on the anticipated closing of this Offering on March 14, 2013.

For each five-year period after the Initial Fixed Rate Period (each, a “Subsequent Fixed Rate Period”), the holders of the Series 5 Shares will be entitled to receive fixed cumulative preferential cash dividends, if, as and when declared by the Board of Directors, payable quarterly on the last business day of each of March, June, September and December at the Annual Fixed Dividend Rate. The Corporation will determine on the 30th day prior to the first day of a Subsequent Fixed Rate Period, the annual fixed dividend rate applicable to that Subsequent Fixed Rate Period (the “Annual Fixed Dividend Rate”). Written notice of the Annual Fixed Dividend Rate for the upcoming Subsequent Fixed Rate Period will be provided by the Corporation to the registered holders on the 30th day prior to the first day of a Subsequent Fixed Rate Period. The Annual Fixed Dividend Rate will be equal to the sum of the 5-Year Government of Canada Bond Yield on the 30th day prior to the first day of a Subsequent Fixed Rate Period plus 3.15%. (See “Details of the Offering” in Prospectus Supplement.

The Series 5 Shares will not be redeemable by the Corporation prior to June 30, 2018.  On June 30, 2018 and on June 30 every five years thereafter, subject to certain other restrictions set out in “Details of the Offering – Provisions Common to the Series 5 Shares and the Series 6 Shares – Restrictions on Dividends and Retirement of Shares”, the Corporation may, at its option, upon not less than 30 days and not more than 60 days prior written notice to the holders of the Series 5 Shares, redeem all or any number of the outstanding Series 5 Shares by the payment of $25.00 in cash per Series 5 Share together with all declared and unpaid dividends to but excluding the date fixed for redemption (less any tax required to be deducted and withheld by the Corporation). See “Details of the Offering” in Prospectus Supplement.

The Series 5 Shares and the Series 6 Shares do not have a fixed maturity date and are not redeemable at the option of the holders thereof.

Holders of the Series 5 Shares will have the right, at their option, to convert their Series 5 Shares into Cumulative Floating Rate Preference Shares, Series 6 (the “Series 6 Shares”) on the basis of one Series 6 Share for each Series 5 Share, subject to certain conditions, on June 30, 2018 and on June 30 every five years thereafter. Series 6 Shares will be entitled to floating rate cumulative preferential cash dividends, if, as and when declared by the Board of Directors, payable quarterly on the last business day of each of March, June, September and December in an amount per Series 6 Share determined by multiplying the applicable Floating Quarterly Dividend Rate by $25.00. The Floating Quarterly Dividend Rate for any Quarterly Floating Rate Period will be equal to the sum of the T-Bill Rate plus 3.15% per annum (calculated on the basis of the actual number of days in the applicable Quarterly Floating Rate Period divided by the number of days in the applicable year) determined on the Floating Rate Calculation Date.  See “Details of the Offering” in Prospectus Supplement.

Eligible Dividend Designation

Dividends are 100 per cent eligible dividends as defined by the Income Tax Act. Under this legislation, individual residents in Canada may be entitled to enhanced dividend tax credits that reduce the income tax otherwise payable.

Last updated: November 16, 2017