FS KKR Capital Corp. Form 8-K Summary
Business Context and Reporting Period
This Current Report on Form 8-K was filed by FS KKR Capital Corp. on October 12, 2021. The filing details the entry into material definitive agreements regarding the issuance of new senior unsecured notes.
Key Financial Metrics and Transaction Details
- Debt Issuance: The Company issued two tranches of notes:
- $500,000,000 aggregate principal of 1.650% Notes due 2024.
- $750,000,000 aggregate principal of 3.125% Notes due 2028.
- Total Principal: $1,250,000,000.
- Net Proceeds: Approximately $1,234,000,000.
- Transaction Costs: Underwriting discounts and commissions of approximately $12,500,000 and estimated offering expenses of approximately $600,000.
- Interest Payments: Semi-annual payments commencing April 12, 2022.
- Use of Proceeds: General corporate purposes, including repayment of outstanding indebtedness.
Material Changes
The filing represents a significant increase in the Company's debt obligations through the creation of new direct financial obligations. The Notes rank pari passu with existing unsecured unsubordinated indebtedness and are structurally junior to subsidiary indebtedness. The filing does not provide comparative financial metrics (revenue, profit, cash flow) as this is a transactional report rather than a periodic financial statement.
Outlook, Risks, and Covenants
- Covenants: The Indenture requires compliance with asset coverage requirements under the Investment Company Act of 1940.
- Change of Control: The Company is required to offer to repurchase the Notes at 100% of principal plus accrued interest upon a "change of control repurchase event."
- Redemption: The Notes may be redeemed at the Company's option at prices set forth in the Indenture.
- Regulation FD: A press release was issued on October 12, 2021, containing additional disclosure deemed furnished but not filed.
Investor Verification Checklist
- Verify the specific terms of the "change of control repurchase event" in the Ninth and Tenth Supplemental Indentures.
- Confirm the exact amount of outstanding indebtedness intended to be repaid with the net proceeds.
- Review the full text of the Indenture for limitations and exceptions to the asset coverage covenants.
- Check the press release (Exhibit 99.1) for any additional management commentary not included in the 8-K text.