8-K
FS Credit Opportunities Corp. (FSCO)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):July 14, 2022
FS CREDIT OPPORTUNITIES CORP.
(Exact name of Registrant as specified in its charter)
| Maryland | 811-22802 | 46-1882356 |
|---|---|---|
| (State or other jurisdiction<br><br> <br>of incorporation) | (Commission<br><br> <br>File Number) | (I.R.S. Employer<br><br> <br>Identification No.) |
| 201 Rouse Boulevard<br><br> <br>Philadelphia, Pennsylvania | 19112 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, includingarea code: (215) 495-1150
None
(Former name or former address, if changed sincelast report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | TradingSymbol(s) | Name of each exchangeon which registered |
|---|---|---|
| N/A | N/A | N/A |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 3.03 | Material Modification to Rights of Security Holders. |
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Amended and Restated Distribution Reinvestment Plan
On July 14, 2022, the board of directors (the “Board”) of FS Credit Opportunities Corp. (the “Company”), including the independent directors, approved the termination of the Company’s existing distribution reinvestment plan, adopted on December 21, 2020, effective as of the listing of the Company’s shares of common stock (the “Shares”) on the New York Stock Exchange (the “Listing”). On July 14, 2022, the Board adopted an amended and restated distribution reinvestment plan (the “A&R DRP”), which will also become effective upon the Listing. Upon the Listing, the A&R DRP will be suspended for 181 days following the Listing. The Listing is expected to occur in the end of the third quarter or the beginning of the fourth quarter of 2022, subject to market conditions and final Board approval. There can be no assurance that the Company will be able to complete the Listing within the expected timeframe or at all. A copy of the A&R DRP is attached hereto as Exhibit 99.1.
| Item 7.01 | Regulation FD Disclosures. |
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Elimination of Fractional Shares
In connection with the Listing, the Board has decided to eliminate any outstanding fractional shares of its common stock (the “Fractional Shares”), as permitted by the Maryland General Corporation Law. The Company will eliminate all outstanding Fractional Shares by rounding up the number of Fractional Shares held by each of the Company’s stockholders to the nearest whole number of shares as of a date prior to the Listing.
Implementation and Limited Waiver of the Application of ShareTransfer Restrictions
On June 22, 2022, at the Company’s 2022 annual meeting (the “2022 Annual Meeting”), the stockholders approved a proposal for the Company to implement share transfer restrictions on the Shares for a period of 180 days upon consummation of the Listing (such restrictions, the “Share Transfer Restrictions”). On July 14, 2022, the Board also approved the Company’s implementation of the Share Transfer Restrictions upon consummation of the Listing and, in connection therewith, approved the waiver of the application of the Share Transfer Restrictions as to holders of the Shares with an account balance that is $15,000 or less.
The information in this Item 7.01 is deemed to have been furnished to, and shall not be deemed to be “filed” with, the U.S. Securities and Exchange Commission.
Cautionary Statement Concerning Forward-Looking Statements
Statements included herein may constitute “forward-looking” statements as that term is defined in Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995, including statements with regard to future events or the future performance or operations of the Company. Words such as “intends,” “will,” “expects,” and “may” or similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results to differ materially from those projected in these forward-looking statements. Factors that could cause actual results to differ materially include changes in the economy, geo-political risks, risks associated with possible disruption to the Company’s operations or the economy generally due to hostilities, terrorism, natural disasters or pandemics such as COVID-19, future changes in laws or regulations and conditions in the Company’s operating area, unexpected costs, the ability of the Company to complete the listing, the price at which the Company’s shares of common stock may trade on the New York Stock Exchange and such other factors that are disclosed in the Company’s filings with the Securities and Exchange Commission (the “SEC”). The inclusion of forward-looking statements should not be regarded as a representation that any plans, estimates or expectations will be achieved. Any forward-looking statements speak only as of the date of this communication. Except as required by federal securities laws, the Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on any of these forward-looking statements.
Important Information
The Company, its directors and certain of its officers may be deemed to be participants in the solicitation of proxies from stockholders in connection with the matters to be considered at the 2022 Annual Meeting. On April 28, 2022, the Company filed a definitive proxy statement with the SEC in connection with any such solicitation of proxies from stockholders. Stockholders are strongly encouraged to read the proxy statement as it contains important information. On June 22, 2022, the Company held the 2022 Annual Meeting where stockholders approved proposals for the election of each member of the board of directors and the implementation of a phased approach to the listing. The meeting was adjourned with respect to the investment advisory agreement amendment proposal to permit additional time to solicit stockholder votes for the proposal. The reconvened meeting will be held on August 16, 2022, at 2:30 pm, Eastern Time at 201 Rouse Boulevard, Philadelphia, PA 19112. Information regarding the identity of potential participants, and their direct or indirect interests in the Company, by security holdings or otherwise, are set forth in the proxy statement and any other materials filed with the SEC in connection with the 2022 Annual Meeting. Stockholders are able to obtain any proxy statement, any amendments or supplements to the proxy statement and other documents filed by the Company with the SEC for no charge at the SEC’s website at www.sec.gov. Copies are available at no charge at the Company’s website at https://fsinvestments.com/investments/all-investments/fsco/.
| Item 9.01 | Financial Statements and Exhibits. |
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| (d) | Exhibits. |
| --- | --- |
| EXHIBIT NUMBER | |
| --- | --- |
| Exhibit 99.1 | FS Credit Opportunities Corp. Amended and Restated Distribution Reinvestment Plan |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| FS Credit Opportunities Corp. | ||
|---|---|---|
| Date: July 14, 2022 | By: | /s/ Stephen S. Sypherd |
| Stephen S. Sypherd | ||
| Vice President, Treasurer and Secretary |
FS Credit Opportunities Corp. 8-K
Exhibit 99.1
AMENDED AND RESTATED DISTRIBUTION REINVESTMENT PLAN OF FS CREDIT OPPORTUNITIES CORP.
FS Credit Opportunities Corp., a Maryland corporation (the “Company”), hereby adopts the following plan (the “Plan”) with respect to cash dividends or distributions (each, a “Distribution”) declared by its Board of Directors (the “Board of Directors”) on shares of its common stock, par value $0.001 per share (the “CommonStock”):
1. Unless a stockholder specifically elects to receive cash in accordance with the Plan, all Distributions declared after the effective date hereof by the Board of Directors shall be payable in shares of Common Stock, and no action shall be required on such stockholder’s part to receive a Distribution in shares of Common Stock. DST Systems, Inc., the plan administrator and the Company’s transfer agent and registrar (collectively the “Plan Administrator”), will establish an account for shares of Common Stock received pursuant to the Plan for each stockholder who has not affirmatively elected to receive Distributions in cash (each a “Participant”). The Plan Administrator may hold each Participant’s shares of Common Stock, together with the shares of Common Stock of other Participants in the Plan Administrator’s name or that of its nominee. Notwithstanding anything herein to the contrary and subject to certain limitations and exceptions, a stockholder who was not a participant in the Distribution Reinvestment Plan (effective as of December 21, 2020) may continue to receive Distributions in cash until such time as such stockholder otherwise notifies the Plan Administrator in accordance with Section 4.
2. Such Distributions shall be payable on such date or dates (each, a “Payment Date”) as may be fixed from time to time by the Board of Directors to stockholders of record at the close of business on the record date(s) established by the Board of Directors for such Distribution.
3. With respect to each Distribution pursuant to the Plan, the Company reserves the right to either issue new shares of Common Stock or purchase shares of Common Stock in the open market for the accounts of Participants in connection with implementation of the Plan. Unless the Company, in its sole discretion, otherwise directs the Plan Administrator:
(A) if the Market Price (as defined below) is equal to or greater than NAV (as defined below), then the Company shall issue shares of Common Stock at the greater of (i) NAV or (ii) 95% of the Market Price; or
(B) if the Market Price is less than NAV, then, in the sole discretion of the Company, (i) shares of Common Stock shall be purchased in open market transactions for the accounts of Participants to the extent practicable, or (ii) the Company shall issue shares of Common Stock at NAV.
The number of shares of Common Stock to be issued to a Participant is determined by dividing the total dollar amount of the Distribution payable to the Participant by the price at which the Company issues such shares of Common Stock pursuant to Section 3.(A)(i), 3.(A)(ii) or 3.(B)(ii), as applicable. Shares of Common Stock purchased in open market transactions pursuant to Section 3.(B)(i) will be allocated to a Participant based on the average purchase price, excluding any brokerage charges or other charges, of all shares of Common Stock purchased in the open market with respect to such Distribution. “Market Price*”* means the market price per share of the Common Stock at the close of regular trading on the New York Stock Exchange or any other exchange or inter-dealer quotation system that represents the principal trading market for the shares of Common Stock (the “Principal Trading Market”) on the Payment Date, or if no sale is reported for such day, the average of the reported bid and asked prices. “NAV” means the net asset value per share (as estimated in good faith by the Company and rounded up to the nearest whole cent) of Common Stock on the Payment Date.
4. A stockholder may, however, affirmatively elect to receive such stockholder’s Distributions in cash. Except as may otherwise be permitted by the Company in its sole discretion, the election will be effective immediately if such stockholder notifies the Plan Administrator in writing not less than 10 days prior to the record date fixed by the Board of Directors for the next Distribution; otherwise, such election will be effective only with respect to any subsequent Distribution. Such election shall remain in effect until the stockholder shall notify the Plan Administrator in writing of such stockholder’s withdrawal of the election, which withdrawal will be effective immediately if such stockholder notifies the Plan Administrator in writing not less than 10 days prior to the record date fixed by the Board of Directors for the next Distribution; otherwise, such withdrawal will be effective only with respect to any subsequent Distribution.
5. The Plan Administrator will confirm to each Participant each issuance or acquisition made pursuant to the Plan on such Participant’s behalf as soon as practicable, but not later than the next quarterly statement issued to such Participant. Although each Participant may from time to time have a fractional interest (computed to three decimal places) in a share of Common Stock of the Company, no certificates for a fractional share will be issued. However, Distributions on fractional shares will be credited to each Participant’s account.
6. The Plan Administrator or another agent designated by the Company will forward to each Participant any proxy solicitation materials related to the Company and each report or other communication of the Company delivered to stockholders, and will vote any shares of Common Stock held by it under the Plan in accordance with the instructions set forth on proxies returned to the Company by Participants.
7. In the event that the Company makes available to its stockholders rights to purchase additional shares of Common Stock or other securities, the shares of Common Stock held by the Plan Administrator for each Participant under the Plan will be added to any other shares of Common Stock held by the Participant in calculating the number of rights to be issued to the Participant.
8. There will be no brokerage charges or other sales charges on newly-issued shares of Common Stock acquired by a stockholder under the Plan. The Plan Administrator’s service fee, if any, and expenses for administering the Plan will be paid by the Company. If a Participant elects by written notice to the Plan Administrator to have the Plan Administrator sell part or all of the shares of Common Stock held by the Plan Administrator in the Participant’s account and remit the proceeds to the Participant, whether upon termination of the Plan by the Company, termination by a Participant of such Participant’s account under the Plan or otherwise, the Plan Administrator shall be authorized to deduct from the proceeds a $20.00 transaction fee for each transaction requested by a Participant, plus any applicable brokerage commission.
9. The Plan Administrator or applicable brokerage firm will be responsible for generating or providing a Form 1099-DIV or any related tax forms associated with any Distributions that are reinvested or paid out.
10. Each Participant may terminate such Participant’s account under the Plan by so notifying the Plan Administrator in writing. Such termination will be effective immediately if the Participant’s notice is received by the Plan Administrator not less than 10 days prior to the record date fixed by the Board of Directors for the next Distribution; otherwise, such termination will be effective only with respect to any subsequent Distribution. The Plan may be terminated or suspended from time to time by the Company at any time in its sole and absolute discretion. During any suspension of the Plan, all Distributions declared by the Board of Directors shall be payable in cash. The Plan may be reactivated following any suspension by the Company upon notice of such reactivation in a Form 8-K filed with the Securities and Exchange Commission (“SEC”). Upon any termination of the Plan by the Company or by a Participant of such Participant’s account under the Plan, the Plan Administrator will cause whole shares of Common Stock held for the Participant under the Plan to be credited to the Participant in book-entry form with the Company’s transfer agent and a cash adjustment for any fractional shares to be paid to the Participant at the market price per share of Common Stock at the close of regular trading on the Principal Trading Market on the date of such termination. If no sale is reported on the Principal Trading Market on the date of such termination, then the market price for the purpose of the payment of the cash adjustment for any fractional shares shall be the average of their electronically-reported bid and asked prices on the Principal Trading Market on such termination date. The Plan Administrator shall be authorized to deduct a $20.00 transaction fee, plus any applicable brokerage commission.
11. These terms and conditions may be amended or supplemented by the Company at any time. The amendment or supplement shall be in a current report on Form 8-K filed with the SEC, and shall be deemed to be accepted by each Participant unless, prior to the effective date thereof, the Plan Administrator receives written notice of the termination of such Participant’s account under the Plan. Any such amendment or supplement may include an appointment by the Plan Administrator in its place and stead of a successor agent under these terms and conditions, with full power and authority to perform all or any of the acts to be performed by the Plan Administrator under the terms and conditions agreed upon by the Company. Upon any such appointment of any agent for the purpose of receiving Distributions, the Company shall be authorized to pay to such successor agent, for each Participant’s account, all Distributions payable on shares of Common Stock held in the Participant’s name or under the Plan for retention or application by such successor agent as provided in these terms and conditions.
12. The Plan Administrator will at all times act in good faith and use its best efforts within reasonable limits to ensure its full and timely performance of all services to be performed by it under the Plan and to comply with applicable law, but assumes no responsibility and shall not be liable for loss or damage due to errors unless such error is caused by the Plan Administrator’s negligence, bad faith, or willful misconduct or that of its employees or agents.
13. These terms and conditions of the Plan shall be governed by and construed in accordance with the laws of the State of Maryland, without regard to any conflict of laws principals or rules thereof, to the extent such principals would require or permit the application of the laws of another jurisdiction, and the Investment Company Act of 1940, as amended (the “1940 Act”). In the event of a conflict, the applicable provisions of the 1940 Act shall control.
Effective Date: [ ], 2022