Exploration & Production | Finance & Investing | Capital Markets

Husky Energy Repaying Debt with Latest Offering

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Husky Energy has agreed to issue to a syndicate of underwriters led by Scotia Capital Inc. and TD Securities Inc. for distribution to the public 8,000,000 Cumulative Rate Reset Preferred Shares, Series 3.

The Series 3 Shares will be issued at a price of $25.00 per Series 3 Share, for aggregate gross proceeds of $200 million. Holders of the Series 3 Shares will be entitled to receive a cumulative quarterly fixed dividend yielding 4.50 percent annually for the initial period ending December 31, 2019. Thereafter, the dividend rate will be reset every five years at a rate equal to the five-year Government of Canada bond yield plus 3.13 percent.

Holders of Series 3 Shares will have the right, at their option, to convert their shares into Cumulative Rate Reset Preferred Shares, Series 4, subject to certain conditions, on December 31, 2019 and on December 31 every five years thereafter. Holders of the Series 4 Shares will be entitled to receive cumulative quarterly floating dividends at a rate equal to the 90-day Government of Canada Treasury Bill rate plus 3.13 percent.

Husky has granted the Underwriters an option, exercisable in whole or in part prior to closing, to purchase up to an additional 2,000,000 Series 3 Shares at the same offering price. The Series 3 Shares will be offered by way of prospectus supplement to the short form base shelf prospectus of Husky Energy dated December 31, 2012.

The prospectus supplement will be filed with securities regulatory authorities in all provinces of Canada, except Quebec.

The net proceeds from this offering will be used to further support the Company’s strong balance sheet and business plan as well as for general corporate purposes, which may include, among other things, the partial repayment of the 3.75% medium-term notes due in 2015.