Summary
This 8-K filing by Goldman Sachs Group Inc. (GS) on October 29, 2021, primarily concerns the issuance and terms of its new 4.125% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series V. The company has officially filed a Certificate of Designations to establish the terms of this preferred stock, which has a liquidation preference of $25,000 per share. This action is significant as it introduces a new class of preferred equity to Goldman Sachs' capital structure. The most critical implication for investors revolves around the dividend and share repurchase provisions. The filing explicitly states that Goldman Sachs' ability to declare or pay dividends on its common stock, or to repurchase its common stock, will be restricted if the company fails to pay dividends on the newly issued Series V Preferred Stock. This prioritizes the dividend payments to the Series V Preferred Stockholders over common stock distributions and buybacks, a standard feature for preferred stock but important to note for common shareholders.
Key Highlights
- 1Goldman Sachs issued new 4.125% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series V.
- 2The Series V Preferred Stock has a liquidation preference of $25,000 per share.
- 3The filing of a Certificate of Designations with the Secretary of State of Delaware officially establishes the terms of the Series V Preferred Stock.
- 4A key restriction is imposed on Goldman Sachs' ability to pay common stock dividends or repurchase common stock if it fails to pay dividends on the Series V Preferred Stock.
- 5This issuance is related to an offering and sale of depositary shares representing interests in the Series V Preferred Stock.
- 6Several exhibits, including the Certificate of Designations and legal opinions, are filed with the report.