Summary
Capital One Financial Corporation (COF) has filed an 8-K report detailing a significant capital raise through the issuance of preferred stock. On September 11, 2019, the company sold 60,000,000 depositary shares, each representing a 1/40th interest in its Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series I. This offering raised approximately $1.462 billion in net proceeds after deducting expenses. The Series I Preferred Stock carries a liquidation preference of $25 per depositary share and is subject to certain dividend and repurchase restrictions. Specifically, the company's ability to pay dividends on, or repurchase, its common stock or parity/junior preferred stock is contingent upon declared and paid dividends on the Series I Preferred Stock for the preceding dividend period. This filing establishes the terms and conditions of this new preferred stock issuance, amending the company's Restated Certificate of Incorporation.
Key Highlights
- 1Capital One Financial Corp. successfully raised approximately $1.462 billion in net proceeds through the sale of 60,000,000 depositary shares of its Series I Fixed Rate Non-Cumulative Perpetual Preferred Stock.
- 2The offering involved depositary shares, each representing a 1/40th ownership interest in the Series I Preferred Stock, with a liquidation preference of $25 per depositary share.
- 3A Certificate of Designations was filed on September 10, 2019, establishing the terms, rights, and preferences of the Series I Preferred Stock.
- 4The issuance of this preferred stock amends Capital One's Restated Certificate of Incorporation.
- 5Dividends on the Series I Preferred Stock are non-cumulative.
- 6Restrictions are in place regarding the company's ability to pay dividends on or repurchase its common stock or junior/parity preferred stock if dividends on the Series I Preferred Stock are not declared and paid or set aside for the preceding period.
- 7The offering was conducted under an Underwriting Agreement with a syndicate of underwriters, including BofA Securities, J.P. Morgan Securities, Morgan Stanley & Co., UBS Securities, and Wells Fargo Securities.