Blackstone / GSO Secured Lending Fund — Form 8-K Summary
Business Context and Reporting Period
The Form 8-K reports a material financing transaction entered into on December 10, 2019, by BGSL Big Sky Funding LLC, a wholly owned subsidiary of Blackstone / GSO Secured Lending Fund. The report was signed and filed on December 16, 2019.
Material Financing and Key Terms
- Facility: Senior secured revolving credit facility with Bank of America, N.A. as administrative agent and Wells Fargo Bank, N.A. as collateral administrator.
- Initial commitments: $400 million, with an accordion feature that could increase total commitments to up to $500 million, subject to conditions.
- Interest rate: One- or three-month LIBOR plus a 1.60% annual margin.
- Fees: A 1.60% annual fee applies to unused amounts below the required minimum utilization amount. A 0.45% annual unused fee applies to daily unused commitments above the minimum utilization amount beginning three months after closing.
- Minimum utilization: Increases from 20% six months after closing to 80% 15 months after closing and thereafter, in three-month increments.
- Maturity: All outstanding amounts must be repaid three years after the closing date.
- Collateral: First-priority security interest in the subsidiary’s portfolio investments and cash.
- Use of proceeds: Funding portfolio investments and advances under revolving or delayed-draw term loans in which the subsidiary is a lender.
- Recourse: The subsidiary’s obligations are non-recourse to the fund. The fund’s exposure is limited to the value of its investment in the subsidiary.
Material Changes, Outlook, and Risks
The filing does not provide revenue, profit, cash flow, margin, asset value, or liquidity metrics for a comparable prior period. It also does not provide earnings guidance or a broader operating outlook.
The facility creates a new secured financing obligation at the subsidiary level and introduces interest-rate exposure through LIBOR-based borrowings, minimum-utilization requirements, unused-commitment fees, collateral requirements, and customary covenants and reporting obligations. Events of default include a change of control and other customary events. During an event of default, Bank of America may accelerate all outstanding obligations, and the subsidiary must obtain the bank’s consent before selling or disposing of portfolio investments.
Most Important Facts to Verify
- Whether the accordion feature is exercised and total commitments increase above $400 million.
- Actual borrowings, utilization levels, and unused-commitment fees under the facility.
- The closing date and resulting three-year maturity date.
- Compliance with minimum-utilization requirements, covenants, and collateral conditions.
- Any subsequent amendments, defaults, repayment activity, or changes in LIBOR-based pricing.
- The complete facility agreement filed as Exhibit 10.1, including representations, covenants, events of default, and other restrictions.