Eagle Point Income Company Inc. — Form 8-K Summary
Business Context and Reporting Period
The Form 8-K reports actions beginning October 18, 2021, relating to Eagle Point Income Company Inc.’s issuance of Series A Term Preferred Stock. The offering closed on October 22, 2021, subject to customary closing conditions. The Company is a Delaware corporation whose common stock trades on the New York Stock Exchange under the symbol EIC.
Offering and Key Financial Terms
| Item | Reported terms |
|---|---|
| Security issued | 5.00% Series A Term Preferred Stock due 2026 |
| Shares offered | 1,220,000 shares |
| Underwriters’ option | Up to 180,000 additional shares within 30 days of October 18, 2021 |
| Total shares designated | 1,600,000 shares |
| Liquidation preference | $25 per share, plus accumulated and unpaid dividends |
| Dividend rate | 5.00% annually, or $1.25 per share per year; intended to be paid monthly when declared and legally available |
| Mandatory redemption | October 30, 2026, at the liquidation preference plus accumulated and unpaid dividends |
| Optional redemption | Permitted on or after October 31, 2023, at the liquidation preference plus accumulated and unpaid dividends |
The filing does not provide offering proceeds, underwriting discounts, net proceeds, earnings, cash flow, margins, debt balances, liquidity levels, or asset coverage ratios.
Material Changes Versus the Prior Comparable Period
The filing text does not provide a prior-period financial comparison. The material change reported is the creation and offering of a new preferred-stock class and the related modification of preferred security holders’ rights.
Rights, Risks, and Other Important Terms
- The Series A Term Preferred Stock ranks senior to common stock for dividends and distributions, ranks equally with other future preferred stock, and is subordinate to existing and future indebtedness, including the Company’s BNP Paribas credit facility.
- The Company may not modify or repeal its mandatory redemption obligation without unanimous approval of the preferred holders.
- The dividend rate increases by 2 percentage points per annum if the Company fails to redeem the shares when required or fails to pay a dividend on its payment date, continuing until the failure is cured.
- The Company may defer or not pay dividends if its board determines this is not in the best interests of stockholders or if required asset coverage under the Investment Company Act of 1940 is not maintained.
- Preferred holders generally receive one vote per share and vote with common stockholders as a single class, subject to specified class voting rights.
- Preferred holders may elect two directors and, after a failure to pay two full years of dividends, may elect a majority of the board until the default is cured.
- The Series A Term Preferred Stock is expected to trade on the NYSE under the symbol EICA.
Important Facts for Investors to Verify
- Confirm the final number of shares issued, including whether the 180,000-share underwriters’ option was exercised.
- Verify gross and net offering proceeds and how the Company used the capital.
- Review the Company’s asset coverage and compliance with the Investment Company Act requirements.
- Assess the Company’s ability to fund monthly dividends and the $25-per-share mandatory redemption in 2026.
- Review the Series A Term Preferred Stock’s ranking relative to the BNP Paribas credit facility and other indebtedness.
- Confirm the NYSE listing and trading status under ticker EICA and the applicable dividend payment dates.