PPL.PR.A - Series 1 Prospectus – Pembina Pipeline Corporation Preferred Shares

PPL.PR.A – Series 1 Prospectus – Pembina Pipeline Corporation Preferred Shares

The following is a set of excerpts from the prospectus document for the Series 1 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 PPL.PR.A – Series 1 Prospectus – Pembina Pipeline Corporation Preferred Shares was used for the excerpts and the important information was highlighted for quick access.

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Excerpt: Size and initial yield

July 19, 2013 PEMBINA PIPELINE CORPORATION $250,000,000 10,000,000 Cumulative Redeemable Rate Reset Class A Preferred Shares, Series 1 Pembina Pipeline Corporation (the “Corporation” or “Pembina”) is hereby qualifying the distribution (the “Offering”) of 10,000,000 cumulative redeemable rate reset Class A Preferred Shares, Series 1 (“Series 1 Shares”) of the Corporation at a price of $25.00 per Series 1 Share. See “Details of the Offering” and “Plan of Distribution”.
The holders of Series 1 Shares will be entitled to receive, as and when declared by the board of directors of the Corporation out of moneys of the Corporation properly applicable to the payment of dividends, fixed cumulative preferential cash dividends for the initial period (the “Initial Fixed Rate Period”) from and including the date of issue of the Series 1 Shares to but excluding December 1, 2018, at an annual rate of $1.0625 per share, payable quarterly on the 1st day of March, June, September and December in each year (other than September 1, 2013). If any such date is not a business day, the dividend will be paid on the next succeeding business day. Assuming an issue date of July 26, 2013, the first dividend, if declared, will be payable December 1, 2013, in the amount of $0.3726 per share.

Excerpt: Reset Date and Yield Terms

For each five-year period after the Initial Fixed Rate Period (each a “Subsequent Fixed Rate Period”, as defined herein), the holders of Series 1 Shares shall be entitled to receive, as and when declared by the board of directors of the Corporation, fixed cumulative preferential cash dividends, payable quarterly on the 1st day of March, June, September and December 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 the 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 Fixed Rate Calculation Date plus a spread of 2.47%. This spread will apply to both the Series 1 Shares and the Series 2 Shares described below, and will remain unchanged over the life of the Series 1 Shares and the Series 2 Shares. See “Details of the Offering”. The Series 1 Shares shall not be redeemable prior to December 1, 2018. On December 1, 2018, and on December 1 in every fifth year thereafter, the Corporation may, at its option, upon not less than 30 days and not more than 60 days prior written notice, redeem for cash all or any part of the outstanding Series 1 Shares by the payment of $25.00 per Series 1 Share plus all accrued and unpaid dividends.

Excerpt: Conversion Terms

Option to Convert into Series 2 Shares The holders of the Series 1 Shares will have the right to convert all or any of their shares into cumulative redeemable floating rate Class A Preferred Shares, Series 2 of the Corporation (the “Series 2 Shares”), subject to certain conditions, on December 1, 2018 and on December 1 in every fifth year thereafter. The holders of the Series 2 Shares will be entitled to receive, as and when declared by the board of directors of the Corporation, quarterly floating rate cumulative preferential cash dividends payable on the 1st day of March, June, September and December in each year (each such quarterly dividend period is referred to as a “Quarterly Floating Rate Period”, as defined herein) in the amount per share 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. 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) plus a spread of 2.47%. See “Details of the Offering”. The Series 1 Shares and Series 2 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.