This news release constitutes a “designated news release” for the purposes of the Company’s prospectus supplement dated July 7, 2021 to its short form base shelf prospectus dated June 22, 2021.
TORONTO, May 31, 2022 (GLOBE NEWSWIRE) — Canadian Banc Corp. (the “Company’) is pleased to announce it will undertake an offering of Preferred Shares and Class A Shares of the Company. The offering will be led by National Bank Financial Inc.
The Preferred Shares will be offered at a price of $10.00 per Preferred Share to yield 5% and the Class A Shares will be offered at a price of $14.50 per Class A Share with a target yield of 14.9%.
The closing price on the TSX of each of the Preferred Shares and the Class A Shares on May 30, 2022 was $10.10 and $14.88, respectively.
Since inception of the Company, the aggregate dividends declared on the Preferred Shares have been $8.91 per share and the aggregate dividends declared on the Class A Shares have been $18.38 per share, for a combined total of $27.29 per unit. All distributions to date have been made in tax advantaged eligible Canadian dividends or capital gains dividends.
Quadravest Capital Management Inc. (“Quadravest”), the investment manager of the “Company”), announces today that effective June 1, 2022, the Companies will discontinue the payment of the service fee which is currently paid to dealers whose clients hold Class A Shares of the Company.
This change is required in order that the Company can comply with applicable securities laws across all dealer platforms. The discontinuation of the service fee will reduce the expenses of the Company, thereby increasing the returns of the Company.
The net proceeds of the offering will be used by the Company to invest in a portfolio of six publicly traded Canadian Banks as follows:
| Bank of Montreal | Canadian Imperial Bank of Commerce | Royal Bank of Canada |
| The Bank of Nova Scotia | National Bank of Canada | The Toronto-Dominion Bank |
The Company’s investment objectives are to:
Preferred Shares:
- provide holders with cumulative preferential floating rate monthly cash dividends at a rate per annum equal to the prevailing Canadian prime rate plus 1.50% (minimum annual rate of 5.0% and maximum annual rate of 8.0%) based on original issue price; and
- on or about the termination date, currently December 1, 2023 (subject to further 5 year extensions and it has been extended in the past) to pay holders the original $10 issue price of those shares.
Class A Shares:
- provide holders with regular monthly cash distributions currently targeted to be at the annualized rate of 15% based upon the volume-weighted average trading price of the Class A Shares for the last three trading days of the preceding month; and
- on or about the termination date, currently December 1, 2023 (subject to further 5 year extensions and it has been extended in the past) to pay holders the original issue price of those shares.
The sales period of this overnight offering will end at 9:00 a.m. EST on June 1, 2022. The offering is expected to close on or about June 8, 2022 and is subject to certain closing conditions including approval by the TSX.
A prospectus supplement to the Company’s short form base shelf prospectus dated June 22, 2021, as amended May 30, 2022, containing important detailed information about the Preferred Shares and the Class A Shares being offered will be filed with securities commissions or similar authorities in all provinces of Canada. Copies of the prospectus supplement and the short form base shelf prospectus may be obtained from your registered financial advisor using the contact information for such advisor, or from representatives of the agents listed above. There will not be any sale or any acceptance of an offer to buy the securities being offered until the prospectus supplement has been filed with the Securities Commissions or similar authorities in each of the provinces of Canada.
Investor Relations: 1-877-478-2372
Local: 416-304-4443
www.canadianbanc.com
info@quadravest.com
