PIMCO Income Strategy Fund II SC TO-I/A, filed Apr 15, 2024
PIMCO Income Strategy Fund II (PFN)
As filed with the Securities and Exchange Commission on April 15, 2024
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE TO
Tender Offer Statement Under Section 14(d)(1) or 13(e)(1) of the
Securities Exchange Act Of 1934
Amendment No. 1
PIMCO Income Strategy Fund II
(Name of Subject Company (Issuer))
PIMCO Corporate & Income Opportunity Fund
(Name of Filing Person (Issuer))
Auction-Rate Preferred Shares, Series M, Series T, Series W, Series TH, and Series F, Par Value $0.00001
(Title of Class of Securities)
72201J500
72201J203
72201J302
72201J401
72201J609
(CUSIP Number of Class of Securities)
Ryan Leshaw
PIMCO Income Strategy Fund II
1633 Broadway
New York, NY 10019
Telephone: (949) 720-6980
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of the Person(s) Filing Statement)
With a Copy to:
David C. Sullivan
Ropes & Gray LLP
Prudential Tower
800 Boylston Street
Boston, MA 02199-3600
Telephone: (617) 951-7362
| ☐ | Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. |
Check the appropriate boxes below to designate any transactions to which the statement relates:
| ☐ | third party tender offer subject to Rule 14d-1. |
| ☒ | issuer tender offer subject to Rule 13e-4. |
| ☐ | going-private transaction subject to Rule 13e-3. |
| ☐ | amendment to Schedule 13D under Rule 13d-2. |
Check the following box if the filing is a final amendment reporting the results of the tender offer. ☒
ITEMS 1 THROUGH 9 AND ITEM 11.
This Amendment No. 1 (this “Amendment”) amends and supplements the Tender Offer Statement (the “Statement”) on Schedule TO initially filed by PIMCO Income Strategy Fund II, a Massachusetts business trust (the “Fund”). This Schedule TO relates to the Fund’s offer to purchase for cash up to 100% of its outstanding shares of auction-rate preferred shares, $0.00001 par value and a liquidation preference of $25,000 per share, designated Auction-Rate Preferred Shares, Series M, Series T, Series W, Series TH, and Series F (the “Preferred Stock”), upon the terms and subject to the conditions set forth in the Offer to Purchase dated March 12, 2024 (the “Offer to Purchase”) and in the Fund’s related Letter of Transmittal (the “Letter of Transmittal” which, together with the Offer to Purchase, as each may be amended and supplemented from time to time, constitutes the “Offer”), copies of which have been previously filed as Exhibits (a)(1)(i) and (a)(1)(ii) to the Schedule TO, respectively. The price to be paid for the Preferred Stock is an amount per share, net to the seller in cash, equal to 96% of the liquidation preference of $25,000 per share (or $24,000 per share) in cash, plus any unpaid dividends accrued through April 12, 2024, less any applicable withholding taxes and without interest, and subject to the conditions set forth in the Offer, if properly tendered and not withdrawn prior to the Expiration Date (as defined in the Offer). The information set forth in the Offer is incorporated herein by reference with respect to Items 1 through 9 and Item 11 of this Amendment.
This Amendment is the final amendment to the Statement and is being filed to report the results of the Offer. Filed herewith as Exhibit (a)(5)(ii) and incorporated herein by reference is a copy of the press release issued by the Fund dated April 15, 2024 announcing the results of the Offer.
ITEM 10.
Not applicable.
ITEM 12. EXHIBITS.
| Exhibit No. | Document | |
| (a)(1)(i) |
Offer to Purchase dated March 12, 2024. (1) | |
| (a)(1)(ii) |
Form of Letter of Transmittal. (1) | |
| (a)(1)(iii) |
Form of Notice of Guaranteed Delivery. (1) | |
| (a)(1)(iv) |
Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (1) | |
| (a)(1)(v) |
Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (1) | |
| (a)(1)(vi) |
Form of Notice of Withdrawal. (1) | |
| (a)(5)(i) |
Press Release issued on March 12, 2024.(1) | |
| (a)(5)(ii) |
Press Release issued on April 15, 2024.* | |
| (d)(i) |
Tender Offer Agreement, dated March 12, 2024, by and among PIMCO Corporate & Income Opportunity Fund, PIMCO High Income Fund, PIMCO Income Strategy Fund, PIMCO Income Strategy Fund II, PIMCO Corporate & Income Strategy Fund, PIMCO Municipal Income Fund, PIMCO Municipal Income Fund II, PIMCO Municipal Income Fund III, PIMCO California Municipal Income Fund, PIMCO California Municipal Income Fund II, PIMCO California Municipal Income Fund III, PIMCO New York Municipal Income Fund, PIMCO New York Municipal Income Fund II, PIMCO New York Municipal Income Fund III, Pacific Investment Management Company LLC, and UBS Real Estate Securities, Inc. (1) | |
| EX-FILINGFEES |
Calculation of Filing Fees Table* | |
| __________________ *Filed herewith. (1) Incorporated by reference to the Fund’s Schedule TO, as filed with the Securities and Exchange Commission on March 12, 2024. | ||
ITEM 13.
Not applicable.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
| PIMCO Income Strategy Fund II | ||
| By: | /s/ Joshua D. Ratner | |
| Name: | Joshua D. Ratner | |
| Title: |
President | |
Dated as of: April 15, 2024
EXHIBIT INDEX
| Exhibit No. | Document | |
| (a)(1)(i) |
Offer to Purchase dated March 12, 2024. (1) | |
| (a)(1)(ii) |
Form of Letter of Transmittal. (1) | |
| (a)(1)(iii) |
Form of Notice of Guaranteed Delivery. (1) | |
| (a)(1)(iv) |
Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (1) | |
| (a)(1)(v) |
Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (1) | |
| (a)(1)(vi) |
Form of Notice of Withdrawal. (1) | |
| (a)(5)(i) |
Press Release issued on March 12, 2024.(1) | |
| (a)(5)(ii) |
Press Release issued on April 15, 2024.* | |
| (d)(i) |
Tender Offer Agreement, dated March 12, 2024, by and among PIMCO Corporate & Income Opportunity Fund, PIMCO High Income Fund, PIMCO Income Strategy Fund, PIMCO Income Strategy Fund II, PIMCO Corporate & Income Strategy Fund, PIMCO Municipal Income Fund, PIMCO Municipal Income Fund II, PIMCO Municipal Income Fund III, PIMCO California Municipal Income Fund, PIMCO California Municipal Income Fund II, PIMCO California Municipal Income Fund III, PIMCO New York Municipal Income Fund, PIMCO New York Municipal Income Fund II, PIMCO New York Municipal Income Fund III, Pacific Investment Management Company LLC, and UBS Real Estate Securities, Inc. (1) | |
| EX-FILINGFEES |
Calculation of Filing Fees Table* | |
| __________________ *Filed herewith. (1) Incorporated by reference to the Fund’s Schedule TO, as filed with the Securities and Exchange Commission on March 12, 2024. | ||
April 15, 2024
For information on the Tender Offers:
Financial Advisors: (800) 628-1237
Shareholders: (844) 337-4626 or (844) 33-PIMCO
PIMCO Media Relations: (212) 597-1054
PIMCO CORPORATE & INCOME STRATEGY FUND, PIMCO HIGH INCOME FUND, PIMCO INCOME STRATEGY FUND, PIMCO INCOME STRATEGY FUND II AND PIMCO CORPORATE & INCOME OPPORTUNITY FUND ANNOUNCE FINAL RESULTS OF TENDER OFFERS FOR AUCTION RATE PREFERRED SHARES
NEW YORK, NY, April 15, 2024 – PIMCO Corporate & Income Strategy Fund (NYSE: PCN), PIMCO High Income Fund (NYSE: PHK), PIMCO Income Strategy Fund (NYSE: PFL), PIMCO Income Strategy Fund II (NYSE: PFN) and PIMCO Corporate & Income Opportunity Fund (NYSE: PTY) (each, a “Fund” and, together, the “Funds”) today announced the expiration and final results of each Fund’s previously-announced voluntary tender offer (each, a “Tender Offer” and, together, the “Tender Offers”) for up to 100% of the Fund’s outstanding auction rate preferred shares (“ARPS”) at a price equal to 94.25%, with respect to PCN and PHK, 96%, with respect to PFL and PFN, and 98% with respect to PTY, of the ARPS’ per share liquidation preference of $25,000 per share (or $23,562.50 per share for PCN and PHK, $24,000 per share of PFL and PFN, and $24,500 per share for PTY) and any unpaid dividends accrued through the expiration date of the Tender Offer. The Tender Offers expired on April 12, 2024, at 5:00 p.m. New York City time. All ARPS that were validly tendered and not withdrawn during the offering period of the Tender Offers have been accepted for payment as set forth below.
| NYSE Ticker |
Number of Shares Accepted for Payment |
Shares Accepted as Percentage of the Fund’s Outstanding ARPS |
Number of ARPS Remaining Outstanding | |||
| PCN |
476 |
91.71% |
43 | |||
| PHK |
1,674 |
96.15% |
67 | |||
| PFL |
367 |
90.84% |
37 | |||
| PFN |
1,426 |
91.65% |
130 | |||
| PTY |
3,246 |
94.88% |
175 |
All ARPS that were not tendered will remain outstanding, and the terms of the outstanding ARPS will remain the same as prior to the Tender Offers.
Any questions regarding the Tender Offers can be directed to the Funds’ Information Agent, EQ Fund Solutions, LLC, at (877) 478-5044. Each Fund’s daily New York Stock Exchange closing market price for its common shares, net asset value per common share, as well as other information, including updated portfolio statistics and performance, are available at www.pimco.com/closedendfunds.
As previously announced, each Fund may determine to replace all or a portion of the leverage previously obtained through tendered ARPS with other forms of leverage in accordance with the Fund’s investment policies and related public disclosures. There is no guarantee that a Fund will be able to replace all or a portion of the leverage previously obtained through tendered ARPS with leverage at comparable costs and other terms, or will elect to do so, and any replacement leverage may be at a higher interest rate and/or may result in higher costs to the Fund’s common shareholders.
The information on or accessible through www.pimco.com/closedendfunds is not incorporated by reference herein.
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Except for the historical information and discussions contained herein, statements contained in this news release constitute forward-looking statements. These statements may involve a number of risks, uncertainties and other factors that could cause actual results to differ materially, including the performance of financial markets, the investment performance of PIMCO’s sponsored investment products and separately managed accounts, general economic conditions, future acquisitions, competitive conditions and government regulations, including changes in tax laws. Readers should carefully consider such factors. Further, such forward-looking statements speak only on the date at which such statements are made. PIMCO undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statement.
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