Industrial Alliance Announces Conversion Privilege and Dividend Rates of Non-Cumulative 5-Year Rate Reset Preferred Shares
The foregoing conversion right is subject to the conditions that: (i) if Industrial Alliance determines that there would be less than 1,000,000 Series H Shares outstanding after June 30, 2017, then holders of Series G Shares will not be entitled to convert their shares into Series H Shares, and (ii) alternatively, if Industrial Alliance determines that there would remain outstanding less than 1,000,000 Series G Shares after June 30, 2017, then all remaining Series G Shares will automatically be converted into Series H Shares on June 30, 2017 on a one-for-one basis. In either case, Industrial Alliance will give written notice to that effect to the registered holder of Series G Shares on or before June 22, 2017.
With respect to any Series G Shares that remain outstanding after June 30, 2017, holders of the Series G Shares will be entitled to receive fixed non-cumulative preferential cash dividends, as and when declared by the Board of Directors of Industrial Alliance, payable on a quarterly basis and subject to the provisions of An Act respecting Insurance (Québec). The dividend rate for the five-year period from and including June 30, 2017 to but excluding June 30, 2022 will be 3.777% per annum or $0.2360625 per share per quarter, being equal to the five-year Government of Canada bond yield as at May 31, 2017 plus 2.85%, as determined in accordance with the terms of the Series G Shares as summarized in the Prospectus.
With respect to any Series H Shares that may be issued on June 30, 2017, holders of the Series H Shares will be entitled to receive floating rate, non-cumulative, preferential cash dividends, as and when declared by the Board of Directors of Industrial Alliance, payable on a quarterly basis and subject to the provisions of An Act respecting Insurance (Québec). The dividend rate for the floating rate period from and including June 30, 2017 to but excluding September 30, 2017 will be 0.85169% (3.379% on an annualized basis) and the dividend for such period, if and when declared, will be $0.2129225 per share, being equal to the three month Government of Canada Treasury Bill yield plus 2.85% (calculated on the basis of the actual number of days elapsed in such quarterly period divided by 365), as determined in accordance with the terms of the Series H Shares as summarized in the Prospectus.
The Series G Shares are issued in “book entry only” form and all rights of holders of Series G Shares must be exercised through CDS or the CDS participant through which the Series G Shares are held. Beneficial owners of Series G 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 on or prior to the deadline for exercise, which is 5:00 p.m. (Montreal time) on June 15, 2017.
An application will be made to list the Series H Shares on the Toronto Stock Exchange (“TSX”).
This press release does not constitute an offer to sell or a solicitation to buy securities in Canada, the United States or any other jurisdiction. The securities mentioned herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state of the United States, and may not be offered or sold in the United States absent registration under the Securities Act or in transactions exempt from, or not subject to, the registration requirements of the Securities Act and applicable state securities laws.
Certain statements made in this news release are forward-looking statements. These statements include, without limitation, statements relating to future conversions, redemptions, quantum and payment of dividends with respect to the Series G Shares and the Series H Shares and listing of the Series H Shares. All such forward-looking statements are made pursuant to the ‘safe harbour’ provisions of applicable Canadian securities laws.
Certain material factors or assumptions are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. Information about material factors that could cause actual results to differ materially from expectations and about material factors or assumptions applied in making forward-looking statements may be found under “Risk Factors” in iA Financial Group’s most recent annual information form, in iA Financial Group’s management’s discussion and analysis for the most recent audited consolidated financial statements under “Risk Management”, in the “Management of Risks Associated with Financial Instruments”, “Management of Insurance Risk” and “Insurance Contract Liabilities and Investment Contract Liabilities” notes to iA Financial Group’s most recent audited consolidated financial statements, and elsewhere in iA Financial Group’s filings with Canadian securities regulators, which are available for review at www.sedar.com.
The forward-looking statements in this news release reflect, unless otherwise indicated, iA Financial Group’s expectations as of the date hereof. iA Financial Group does not undertake any obligation to update or release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as required by law.