W.PR.M Enbridge Preferred Shares Series 12
The following is a set of excerpts from the prospectus document for the Series 12 preferreds. The excerpts, highlight the most relevant information, an investor should know when analyzing this preferred. A link to the prospectus is provided lower in this page. The original document for W.PR.M Enbridge Preferred Shares Series 12 was used for the excerpts and the important information was highlighted for quick access.
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Excerpt: Size and initial yield
August 23, 2016 WESTCOAST ENERGY INC. $300,000,000 (12,000,000 shares) Cumulative Five-Year Minimum Rate Reset Redeemable First Preferred Shares, Series 12 Westcoast Energy Inc. (the “Corporation”) is hereby qualifying for distribution 12,000,000 cumulative five-year minimum rate reset redeemable first preferred shares, Series 12 of the Corporation (the “Series 12 First Preferred Shares”) at a price of $25.00 per Series 12 First Preferred Share.
See “Plan of Distribution”. The holders of the Series 12 First Preferred Shares shall be entitled to receive fixed cumulative preferential cash dividends, as and when declared by the board of directors of the Corporation (the “Board of Directors”), out of the moneys of the Corporation properly applicable to the payment of dividends. The dividends are expected to be paid at the rate of $1.3000 per share per annum, payable by quarterly installments on the 15th day of January, April, July and October in each year, for the Initial Fixed Rate Period (as defined herein) from and including the date of issue of the Series 12 First Preferred Shares to but excluding October 15, 2021.
If any such date is not a Business Day (as defined herein), the dividend will be paid on the next succeeding Business Day. Assuming an issue date of August 30, 2016, the first dividend, if declared, will be payable on October 15, 2016 in the amount of $0.1638 per share.
Excerpt: Reset Date and Yield Terms
For every five-year period after the Initial Fixed Rate Period (each, a “Subsequent Fixed Rate Period”), the holders of the Series 12 First Preferred Shares shall be entitled to receive fixed cumulative preferential cash dividends, as and when declared by the Board of Directors, out of the moneys of the Corporation properly applicable to the payment of dividends. The dividends will be payable by quarterly installments on the 15th day of January, April, July and October in each year, in the amount per share determined by multiplying one-quarter of the Annual Fixed Dividend Rate (as defined herein) for such Subsequent Fixed Rate Period by $25.00.
The Annual Fixed Dividend Rate for each ensuing Subsequent Fixed Rate Period will be determined by the Corporation on the Fixed Rate Calculation Date (as defined herein) and will be equal to the sum of the Government of Canada Yield (as defined herein) on the applicable Fixed Rate Calculation Date plus a spread of 4.52% (the “Spread”), provided that, in any event, such rate shall not be less than 5.20 %. This Spread will apply to both the Series 12 First Preferred Shares and the Series 13 First Preferred Shares described below, and will remain unchanged over the life of the Series 12 First Preferred Shares and the Series 13 First Preferred Shares.
See “Details of the Offering”. The Corporation may not redeem the Series 12 First Preferred Shares prior to October 15, 2021. On October 15, 2021, and on October 15 in every fifth year thereafter, the Corporation may, on at least 30 days’ notice, redeem at any time the whole or from time to time any part of the then outstanding Series 12 First Preferred Shares on payment for each share to be redeemed of $25.00 together with an amount equal to all accrued and unpaid dividends thereon up to but excluding the date of redemption. See “Details of the Offering”.
Excerpt: Conversion Terms
Option to Convert Into Series 13 First Preferred Shares The holders of the Series 12 First Preferred Shares will have the right to convert their shares into cumulative floating rate redeemable first preferred shares, Series 13 of the Corporation (the “Series 13 First Preferred Shares”), subject to certain conditions, on October 15, 2021, and on October 15 every five years thereafter. The holders of the Series 13 First Preferred Shares shall be entitled to receive cumulative preferential cash dividends, as and when declared by the Board of Directors, out of the moneys of the Corporation properly applicable to the payment of dividends.
The dividends will be payable on the 15th day of January, April, July, and October in each year (each such quarterly dividend period is referred to as a “Quarterly Floating Rate Period”) in the amount per share per annum determined by multiplying the Floating Quarterly Dividend Rate (as defined herein) for such Quarterly Floating Rate Period by $25.00 and multiplying that product by a fraction, the numerator of which is the actual number of days in such Quarterly Floating Rate Period and the denominator of which is 365 or 366, depending upon the actual number of days in the applicable year. If any such date is not a Business Day, the dividend will be paid on the next succeeding Business Day. The Floating Quarterly Dividend Rate will be the annual rate of interest equal to the sum of the T-Bill Rate (as defined herein) on the applicable Floating Rate Calculation Date (as defined herein) and 4.52%.
See “Details of the Offering”. The Series 12 First Preferred Shares and Series 13 First Preferred Shares are series of shares in the same class. The conversion right entitles holders to elect periodically which of the two series they wish to hold and does not entitle holders to receive a different class or type of securities. Other than the different dividend rights and redemption rights attached thereto, the Series 12 First Preferred Shares and Series 13 First Preferred Shares are identical in all material respects.
W.PR. M Enbridge Preferred Shares Series 12 Original Document
I have presented the most important information regarding the Series 12 preferreds. If you need to go through the original and complete document for W.PR .M Enbridge Preferred Shares Series 12 is available here.