What is the Series J Preferred Stock and what is its significance for Allstate?

The Series J Preferred Stock is a new class of fixed-rate, noncumulative, perpetual preferred stock issued by Allstate. Its significance lies in its potential impact on dividend payments to common shareholders and other junior securities, as dividend payments on these may be restricted if dividends on the Series J Preferred Stock are not met.

What does 'noncumulative' and 'perpetual' mean in the context of this preferred stock?

'Noncumulative' means that if Allstate fails to declare and pay a dividend for a specific period, that missed dividend is forfeited and will not be owed to shareholders later. 'Perpetual' means the stock has no maturity date and is intended to remain outstanding indefinitely, forming a permanent part of the company's capital structure.

What were the key terms of the offering?

Allstate offered 24,000,000 depositary shares, with each depositary share representing a 1/1000th interest in a share of Series J Preferred Stock. The offering was conducted under an underwriting agreement with several major financial institutions and was registered with the SEC.

ALL 8-K: Shareholder Matters & Corporate Changes

Q: How does the issuance of Series J Preferred Stock affect current common stockholders?

The primary impact on common stockholders is a potential restriction on dividend payments. If Allstate does not pay dividends on the Series J Preferred Stock for the preceding dividend period, the company's ability to declare or pay dividends on its common stock (or any securities ranking junior to or on parity with the Series J Preferred Stock) will be restricted. This filing does not specify the dividend rate for the Series J Preferred Stock.

Summary

The Allstate Corporation (ALL) filed an 8-K report on May 18, 2023, to announce the issuance and closing of its Series J Fixed Rate Noncumulative Perpetual Preferred Stock. This offering consisted of 24,000,000 depositary shares, each representing a 1/1000th interest in a share of the Series J Preferred Stock. This issuance introduces new terms that place restrictions on the company's ability to declare or pay dividends on, or repurchase, its common stock or any securities ranking junior to or on parity with the Series J Preferred Stock, if the company fails to pay dividends on the preferred stock for the preceding dividend period. Investors should note that this is a perpetual preferred stock, meaning it has no maturity date. The terms and conditions, including the dividend restrictions and liquidation preferences, are detailed in the Certificate of Designations filed with Delaware. The public offering of the depositary shares was registered under a Form S-3 registration statement and closed on May 18, 2023. The company entered into an underwriting agreement with several representatives, including BofA Securities and J.P. Morgan Securities.

Key Highlights

1Allstate Corp closed a public offering of 24,000,000 depositary shares, each representing an interest in Series J Fixed Rate Noncumulative Perpetual Preferred Stock.
2The issuance of Series J Preferred Stock imposes dividend restrictions on common stock and junior/parity securities if preferred dividends are not paid.
3This is a perpetual preferred stock, meaning it has no maturity date and is intended to be a permanent part of the capital structure.
4The offering was underwritten by a syndicate of financial institutions, including BofA Securities, J.P. Morgan Securities, Loop Capital Markets, Morgan Stanley, and Wells Fargo Securities.
5The terms and conditions of the Series J Preferred Stock are detailed in a Certificate of Designations filed with the Secretary of State of Delaware.
6The offering was registered under a Form S-3 registration statement (File No. 333-255698).

ALLSTATE CORP 8-K Report, Rights Modification (May 18, 2023)

Summary

Key Highlights

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