Item 1.01. Entry Into a Material Definitive Agreement.
On May 31, 2023, in connection with a previously announced public offering,
Gladstone Investment Corporation (the “Company”) and UMB Bank, National
Association, as trustee (the “Trustee”), entered into a Fourth Supplemental
Indenture (the “Fourth Supplemental Indenture”) to the Indenture, dated May 22,
2020, between the Company and the Trustee (together with the Fourth Supplemental
Indenture, the “Indenture”). The Fourth Supplemental Indenture relates to the
Company’s issuance, offer and sale of $74,750,000 aggregate principal amount of
its 8.00% Notes due 2028 (the “Notes”).
The Notes will mature on August 1, 2028, unless previously redeemed or
repurchased in accordance with their terms. The interest rate of the Notes is
8.00% per year, and interest on the Notes will be paid on February 1, May 1,
August 1 and November 1 of each year, beginning on August 1, 2023. The Notes are
the Company’s direct unsecured obligations and rank pari passu with the
Company’s existing and future unsecured, unsubordinated indebtedness, including
its 5.00% notes due 2026 and 4.875% notes due 2028; senior to any series of
preferred stock that the Company may issue in the future; senior to any of the
Company’s future indebtedness that expressly provides it is subordinated to the
Notes; effectively subordinated to any future secured indebtedness of the
Company (including indebtedness that is initially unsecured to which the Company
subsequently grants security), to the extent of the value of the assets securing
such indebtedness; and structurally subordinated to all existing and future
indebtedness and other obligations of any of the Company’s existing or future
subsidiaries, including, without limitation, borrowings under the Company’s
credit facility.
The Notes may be redeemed in whole or in part at any time or from time to time
at the Company’s option on or after August 1, 2025, upon not less than 30 days
nor more than 60 days written notice by mail prior to the date fixed for
redemption thereof, at a redemption price of 100% of the outstanding principal
amount of the Notes to be redeemed plus accrued and unpaid interest payments
otherwise payable for the then-current quarterly interest period accrued to, but
not including, the date fixed for redemption.
The Indenture contains certain covenants, including covenants requiring the Company to comply with Section 18(a)(1)(A) as modified by Section 61(a) (2) of the Investment Company Act of 1940, as amended (the "Investment Company Act"), or any successor provisions, to comply with Section 18(a)(1)(B) as modified by Section 61(a)(2) of the Investment Company Act, or any successor provisions but giving effect to any no-action relief granted by the Securities and Exchange Commission (the "SEC") to another business development company and upon which the Company may reasonably rely (or to the Company if the Company determines to seek such similar no-action or other relief), and to provide certain financial information to the holders of the Notes and the Trustee if the Company should no longer be subject to the reporting requirements under the Securities Exchange Act of 1934, as amended. These covenants are subject to important limitations and exceptions that are set forth in the Indenture. The Notes were offered and sold pursuant to the Company's effective shelf registration statement on Form N-2 (Registration No. 333-259302) previously filed with the SEC, as supplemented by a preliminary prospectus supplement dated May 23, 2023, the pricing term sheet dated May 23, 2023 and a final prospectus supplement dated May 23, 2023. This Current Report on Form 8-K shall not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction. The transaction closed on May 31, 2023.
The Company intends to use the net proceeds from the offering to repay a portion
of the amount outstanding under its credit facility, to fund new investment
opportunities and for other general corporate purposes. The Company
intends to re-borrow under its
credit facility to make investments in portfolio companies in accordance with
its investment objectives depending on the availability of appropriate
investment opportunities consistent with its investment objectives depending on
the availability of appropriate investment opportunities consistent with its
investment objectives and market conditions and for other general corporate
purposes.
The description above is only a summary of the material provisions of the Fourth
Supplemental Indenture and the Notes and is qualified in its entirety by
reference to copies of the Fourth Supplemental Indenture and the Notes,
respectively, each filed as exhibits to this Current Report
on Form 8-K and incorporated
by reference herein.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation Under
an Off-Balance Sheet
Arrangement of a Registrant.
The information set forth under Item 1.01 of
this Form 8-K is incorporated
herein by reference.
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Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
4.1 Fourth Supplemental Indenture between Gladstone Investment
Corporation and UMB Bank, National Association, dated as of May 31,
2023.
4.2 Form of Global Note with respect to the 8.00% Notes due 2028,
incorporated by reference to Exhibit 4.1 hereto.
5.1 Opinion of Kirkland & Ellis LLP.
23.1 Consent of Kirkland & Ellis LLP (included in Exhibit 5.1 hereto).
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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