TORONTO, Aug. 31, 2021 /CNW/ - Intact Financial
Corporation ("IFC") (TSX: IFC) announced today that it does
not intend to exercise its right to redeem all or any part of
the currently outstanding Non-cumulative Rate Reset Class A Shares
Series 3 of IFC (the "Series 3 Preferred Shares") (TSX: IFC.PR.C)
or the Non-cumulative Floating Rate Class A Shares Series 4 of IFC
(the "Series 4 Preferred Shares") (TSX: IFC.PR.D) on September 30, 2021.
As a result, subject to certain conditions set out in the
prospectus supplement dated August 11,
2011 relating to the issuance of the Series 3 Preferred
Shares (the "Prospectus"), the holders of the Series 3 Preferred
Shares will have the right, at their option, to elect to convert
all or any of their Series 3 Preferred Shares into Series 4
Preferred Shares on a one-for-one basis on September 30, 2021. Holders who do not exercise
their right to convert their Series 3 Preferred Shares into Series
4 Preferred Shares on such date will retain their Series 3
Preferred Shares, unless automatically converted in accordance with
the conditions below.
Also, subject to certain conditions set out in the Prospectus,
the holders of the Series 4 Preferred Shares will have the right,
at their option, to elect to convert all or any of their Series 4
Preferred Shares into Series 3 Preferred Shares on a one-for-one
basis on September 30, 2021. Holders
who do not exercise their right to convert their Series 4 Preferred
Shares into Series 3 Preferred Shares on such date will retain
their Series 4 Preferred Shares, unless automatically converted in
accordance with the conditions below.
With respect to any Series 3 Preferred Shares that may remain
outstanding after September 30, 2021,
commencing as of such date, holders thereof will be entitled to
receive fixed non-cumulative preferential cash dividends on a
quarterly basis, as and when declared by the Board of Directors of
IFC. The annual dividend rate for the Series 3 Preferred Shares for
the five-year period from and including September 30, 2021 to but excluding September 30, 2026 will be 3.457%, as determined
in accordance with the terms of the Series 3 Preferred Shares.
With respect to any Series 4 Preferred Shares that may remain
outstanding after September 30, 2021,
holders thereof will be entitled to receive floating rate
non-cumulative preferential cash dividends on a quarterly basis, as
and when declared by the Board of Directors of IFC. The dividend
rate for the Series 4 Preferred Shares for the 3-month floating
rate period from and including September 30,
2021 to but excluding December 31,
2021 will be 0.7176% (2.847% on an annualized basis), as
determined in accordance with the terms of the Series 4 Preferred
Shares (the "Floating Quarterly Dividend Rate"). The Floating
Quarterly Dividend Rate will be reset every quarter.
The foregoing conversion right for the Series 3 Preferred Shares
is subject to the conditions that: (i) if IFC determines that there
would be less than 1,000,000 Series 3 Preferred Shares outstanding
on September 30, 2021, then all
remaining Series 3 Preferred Shares will automatically be converted
into an equal number of Series 4 Preferred Shares on September 30, 2021, and (ii) alternatively, if
IFC determines that there would be less than 1,000,000 Series 4
Preferred Shares outstanding on September
30, 2021, then no Series 3 Preferred Shares will be
converted into Series 4 Preferred Shares. In either case, IFC will
give written notice to that effect to any registered holders of
Series 3 Preferred Shares on or before September 23, 2021.
The foregoing conversion right for the Series 4 Preferred Shares
is subject to the conditions that: (i) if IFC determines that there
would be less than 1,000,000 Series 4 Preferred Shares outstanding
on September 30, 2021, then all
remaining Series 4 Preferred Shares will automatically be converted
into an equal number of Series 3 Preferred Shares on September 30, 2021, and (ii) alternatively, if
IFC determines that there would be less than 1,000,000 Series 3
Preferred Shares outstanding on September
30, 2021, then no Series 4 Preferred Shares will be
converted into Series 3 Preferred Shares. In either case, IFC will
give written notice to that effect to any registered holders of
Series 4 Preferred Shares on or before September 23, 2021.
The Series 3 Preferred Shares and the Series 4 Preferred Shares
are issued in "book entry only" form and must be purchased or
transferred through a participant in the CDS depository service
("CDS Participant"). All rights of holders of Series 3 Preferred
Shares and all rights of holders of Series 4 Preferred Shares must
be exercised through CDS or the CDS Participant through which the
Series 3 Preferred Shares and the Series 4 Preferred Shares are
held. The deadline for (1) the registered shareholder of any Series
3 Preferred Shares to provide notice of exercise of the right to
convert Series 3 Preferred Shares into Series 4 Preferred Shares,
and (2) the registered shareholders of any Series 4 Preferred
Shares to provide notice of exercise of the right to convert Series
4 Preferred Shares into Series 3 Preferred Shares is 5:00 p.m. (ET) on September 15, 2021. Any notices received after
this deadline will not be valid. As such, holders of Series 3
Preferred Shares and/or Series 4 Preferred Shares who wish to
exercise their right to convert their shares should contact their
broker or other intermediary for more information and it is
recommended that this be done well in advance of the deadline in
order to provide the broker or other intermediary with time to
complete the necessary steps.
Holders of the Series 3 Preferred Shares and the Series 4
Preferred Shares will have the opportunity to convert their shares
again on September 30, 2026, and
every five years thereafter as long as the shares remain
outstanding. Subject to certain conditions described in the
Prospectus, IFC may redeem the Series 3 Preferred Shares, in whole
or in part, on September 30, 2026 and
on September 30 every five years
thereafter and may redeem the Series 4 Preferred Shares, in whole
or in part, on any date after September 30,
2016.
For more information on the terms of, and risks associated with
an investment in, the Series 3 Preferred Shares and the Series 4
Preferred Shares, please see IFC's prospectus supplement dated
August 11, 2011 which is available on
www.sedar.com.
Neither the Series 3 Preferred Shares nor the Series 4 Preferred
Shares have been or will be registered in the United States 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, sold or delivered,
directly or indirectly, in the United
States, its territories, its possessions and other areas
subject to its jurisdiction or to, or for the account or benefit
of, a U.S. person (as defined in Regulation S under the Securities
Act), except in certain transactions exempt from, or not subject
to, the registration requirements of the Securities Act and
applicable state securities laws. This press release does not
constitute an offer to sell or a solicitation to buy securities in
the United States and any public
offering of the securities in the United
States must be made by means of a prospectus.
About Intact Financial Corporation
Intact Financial Corporation (TSX: IFC) is the largest provider
of property and casualty (P&C) insurance in Canada, a leading provider of global specialty
insurance, and, with RSA, a leader in the U.K. and Ireland. Our business has grown organically
and through acquisitions to over $20
billion of total annual premiums.
In Canada, Intact distributes
insurance under the Intact Insurance brand through a wide network
of brokers, including its wholly-owned subsidiary BrokerLink, and
directly to consumers through belairdirect. Intact also provides
affinity insurance solutions through the Johnson Affinity
Groups.
In the U.S., Intact Insurance Specialty Solutions provides a
range of specialty insurance products and services through
independent agencies, regional and national brokers, and
wholesalers and managing general agencies.
Outside of North America, the
Company provides personal, commercial and specialty insurance
solutions across the U.K., Ireland, Europe and the Middle East through the RSA brands.
Forward Looking Statements
Certain statements made in this news release are forward-looking
statements. The words "may", "will", "would", "should", "could",
"expects", "plans", "intends", "trends", "indications",
"anticipates", "believes", "estimates", "predicts", "likely",
"potential" or the negative or other variations of these words or
other similar or comparable words or phrases, are intended to
identify forward-looking statements. These statements include,
without limitation, statements relating to future conversions,
redemptions, quantum and payment of dividends with respect to the
Series 3 Preferred Shares and the Series 4 Preferred Shares. All
such forward-looking statements are made pursuant to the 'safe
harbour' provisions of applicable Canadian securities laws. Unless
otherwise indicated, all forward-looking statements in this press
release are made as of August 31,
2021 and are subject to change after that date.
Forward-looking statements, by their very nature, are subject to
inherent risks and uncertainties and are based on several
assumptions, both general and specific, which give rise to the
possibility that actual results or events could differ materially
from our expectations expressed in or implied by such
forward-looking statements as a result of various factors,
including those discussed in IFC's most recently filed Annual
Information Form dated March 31, 2021
and those made in our Q2-2021 Management's Discussion and Analysis
(including in its "Risk Management" in sections 19-20), our 2020
Annual Management's Discussion and Analysis (sections 28-33), in
Notes 10 and 13 of our Consolidated Financial Statements for the
year ended December 31, 2020 and the
additional risk factors of the Company related to the proposed RSA
acquisition as described at pages 24-28 of the Company's
Presentation entitled "Building a Leading P&C Insurer -
Acquisition of RSA's Canada and
UK&I operations," dated November 18,
2020 and the risk factors included in the Company's Business
Acquisition Report dated June 16,
2021 and available on SEDAR at www.sedar.com. As a
result, we cannot guarantee that any forward-looking statement will
materialize and we caution you against relying on any of these
forward-looking statements. Except as may be required by Canadian
securities laws, we do not undertake any obligation to update or
revise any forward-looking statements contained in this news
release, whether as a result of new information, future events or
otherwise. Please read the cautionary note of IFC's Q2-2021
Management's Discussion and Analysis.
SOURCE Intact Financial Corporation