Prospectus excerpt: TransCanada Corporation (the ‘‘Corporation’’) is hereby qualifying the distribution (the ‘‘Offering’’) of 14,000,000 cumulative redeemable first preferred shares, series 3 (‘‘Series 3 Shares’’) of the Corporation at a price of $25.00 per Series 3 Share. See ‘‘Details of the Offering’’ and ‘‘Plan of Distribution’’.
The holders of Series 3 Shares will be entitled to receive, as and when declared by the board of directors of the Corporation out of moneys of the Corporation properly applicable to the payment of dividends, fixed cumulative preferential cash dividends for the initial period (the ‘‘Initial Fixed Rate Period’’) from and including the date of issue of the Series 3 Shares to but excluding June 30, 2015, at an annual rate of $1.00 per share, payable quarterly on the last business day of March, June, September and December in each year. Assuming an issue date of March 11, 2010, the first dividend, if declared, will be payable June 30, 2010, in the amount of $0.3041 per share.
For each five-year period after the Initial Fixed Rate Period (each a ‘‘Subsequent Fixed Rate Period’’, as defined herein), the holders of Series 3 Shares shall be entitled to receive, as and when declared by the board of directors of the Corporation, fixed cumulative preferential cash dividends, payable quarterly on the last business day of March, June, September and December in each year, in the amount per share determined by multiplying one-quarter of the Annual Fixed Dividend Rate (as defined herein) for such Subsequent Fixed Rate Period by $25.00. The Annual Fixed Dividend Rate for the ensuing Subsequent Fixed Rate Period will be determined by the Corporation on the Fixed Rate Calculation Date (as defined herein) and will be equal to the sum of the Government of Canada Yield (as defined herein) on the Fixed Rate Calculation Date plus a spread of 1.28%. This spread will apply to both the Series 3 Shares and the Series 4 Shares described below, and will remain unchanged over the life of the Series 3 Shares and the Series 4 Shares. See ‘‘Details of the Offering’’.