Business Context and Reporting Period
This Form 8-K is filed by XAI Octagon Floating Rate & Alternative Income Trust (NYSE: XFLT) for the reporting period ending February 28, 2024. The filing reports on an unregistered sale of equity securities under Item 3.02.
Key Financial Metrics
- Transaction Type: Issuance and sale of 6.95% Series 2029 Convertible Preferred Shares.
- Shares Issued: 400,000 shares.
- Price Per Share: $23.25.
- Net Proceeds: Approximately $9.3 million (before expenses).
- Total Outstanding Convertible Preferred Shares: 800,000 shares immediately following this transaction.
Note: The filing does not provide data on revenue, profit, cash flow, margins, debt, or liquidity metrics for the period.
Material Changes
The Trust executed a portion of a purchase agreement entered into on November 6, 2023, with Eagle Point Credit Management LLC. This transaction increased the outstanding count of the 6.95% Series 2029 Convertible Preferred Shares from 400,000 to 800,000 shares.
Guidance, Outlook, and Risks
The filing does not contain management guidance, outlook, or specific risk factors beyond the standard disclosure of the unregistered sale. The transaction was conducted pursuant to Section 4(a)(2) of the Securities Act of 1933. The Trust has the capacity to issue up to 1,200,000 shares under the existing agreement, with a deadline of May 6, 2025.
Investor Verification Checklist
- Verify the total outstanding count of 800,000 Convertible Preferred Shares.
- Confirm the remaining capacity under the purchase agreement (up to 800,000 additional shares).
- Review the Statement of Preferences of Term Preferred Shares (Exhibit 3.1 from the November 7, 2023 filing) for dividend and conversion terms.
- Monitor future filings for additional issuances under the agreement before the May 6, 2025 deadline.