Cenovus provides Series 1 and Series 2 First Preferred Shares conversion privilege notice, Series 1 and Series 2 First Prefer...
March 01 2021 - 1:08PM
Cenovus Energy Inc. (TSX: CVE) (NYSE: CVE) is providing notice the
company does not intend to exercise its right to redeem its
Cumulative Redeemable First Preferred Shares, Series 1 (Series 1
Shares) and Cumulative Redeemable First Preferred Shares, Series 2
(Series 2 Shares) on March 31, 2021. As a result, subject to
certain conditions:
- the holders of Series 1 Shares have
the right to choose one of the following options with regard to
their shares:
- retain any or all of their Series 1
Shares and continue to receive an annual fixed-rate dividend paid
quarterly; or
- convert, on a one-for-one basis, any
or all of their Series 1 Shares into Series 2 Shares and receive an
annual floating-rate dividend paid quarterly, and
- the holders of Series 2 Shares have
the right to choose one of the following options with regard to
their shares:
- retain any or all of their Series 2
Shares and continue to receive an annual floating-rate dividend
paid quarterly; or
- convert, on a one-for-one basis, any
or all of their Series 2 Shares into Series 1 Shares and receive an
annual fixed-rate dividend paid quarterly.
Conversion to either Series 1 Shares or Series 2 Shares is
subject to the conditions that, after taking into account all
Series 1 Shares and Series 2 Shares tendered for conversion: (i) if
Cenovus determines there would be less than 1,000,000 Series 1
Shares outstanding after March 31, 2021, then all remaining Series
1 Shares will automatically be converted to Series 2 Shares on a
one-for-one basis on March 31, 2021 and no Series 2 Shares tendered
for conversion will be converted into Series 1 Shares; and (ii) if
Cenovus determines there would be less than 1,000,000 Series 2
Shares outstanding after March 31, 2021, then all remaining Series
2 Shares will automatically be converted to Series 1 Shares on a
one-for-one basis on March 31, 2021 and no Series 1 Shares tendered
for conversion will be converted into Series 2 Shares. In either
case, Cenovus will issue a news release to that effect no later
than March 24, 2021.
Holders of Series 1 Shares who choose to retain any or all of
their shares or holders of Series 2 Shares who choose to convert to
Series 1 Shares will receive the new annual fixed-rate dividend
paid quarterly applicable to the Series 1 Shares for the five-year
period commencing March 31, 2021 to, but excluding, March 31, 2026
of 2.577%, being equal to the sum of the Government of Canada
five-year bond yield of 0.847% plus 1.73% in accordance with the
terms of the Series 1 Shares, subject to the conditions described
above.
Holders of Series 2 Shares who choose to retain any or all of
their shares or holders of Series 1 Shares who choose to convert to
Series 2 Shares will receive a new annual floating-rate dividend
paid quarterly applicable to the Series 2 Shares for the five-year
period commencing March 31, 2021 to, but excluding, March 31, 2026.
The dividend rate applicable to the Series 2 Shares for the
three-month period commencing March 31, 2021 to, but excluding,
June 30, 2021 will be 1.80301%, being equal to the annual rate for
the most recent auction of 90-day Government of Canada Treasury
Bills of 0.073% plus 1.73%, in accordance with the terms of the
Series 2 Shares (the Floating Quarterly Dividend Rate), subject to
the conditions described above. The Floating Quarterly Dividend
Rate will be reset every quarter.
Beneficial owners of Series 1 Shares or Series 2 Shares who wish
to exercise the right of conversion should communicate as soon as
possible with their brokers or other nominees in order to meet the
deadline for registered holders to exercise such right, which is 5
p.m. ET on March 16, 2021. It is recommended this communication be
had well in advance of the deadline in order to provide the brokers
or other intermediaries with time to complete the necessary steps.
Holders of Series 1 Shares who do not exercise the right of
conversion by this deadline will continue to hold Series 1 Shares
with the new annual fixed rate dividend, subject to the conditions
described above. Holders of Series 2 Shares who do not exercise the
right of conversion by this deadline will continue to hold Series 2
Shares with the new annual floating rate dividend, which will be
reset every quarter, subject to the conditions described above.
Holders of the Series 1 Shares and the Series 2 Shares will have
the opportunity to convert their shares again on March 31, 2026 and
every five years thereafter as long as the shares remain
outstanding.
Cenovus Energy Inc. Cenovus Energy Inc. is an
integrated energy company with oil and natural gas production
operations in Canada and the Asia Pacific region, and upgrading,
refining and marketing operations in Canada and the United States.
The company is focused on managing its assets in a safe, innovative
and cost-efficient manner, integrating environmental, social and
governance considerations into its business plans. Cenovus common
shares and warrants are listed on the Toronto and New York stock
exchanges, and the company’s preferred shares are listed on the
Toronto Stock Exchange. For more information,
visit cenovus.com.
Find Cenovus on Facebook, Twitter, LinkedIn, YouTube and
Instagram.
CENOVUS CONTACTS: |
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Investor
RelationsInvestor Relations general
line403-766-7711 |
Media
RelationsMedia Relations general
line403-766-7751 |
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