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 of October 10, 2024. The filing reports on an unregistered sale of equity securities under Item 3.02.
Key Financial Metrics and Transaction Details
- Transaction Type: Issuance and sale of 6.95% Series II 2029 Convertible Preferred Shares.
- Shares Issued: 200,000 shares.
- Price per Share: $23.25.
- Net Proceeds: Approximately $4.65 million (before expenses).
- Total Outstanding Series II 2029 Shares: 1,800,000 shares immediately following this issuance.
Material Changes
The Trust completed a tranche of a previously disclosed purchase agreement entered into on June 10, 2024. This specific issuance on October 10, 2024, increased the total outstanding Series II 2029 Convertible Preferred Shares to the maximum authorized amount of 1,800,000 shares under the agreement.
Guidance, Outlook, and Risks
The filing does not provide new financial guidance, outlook, or management commentary beyond the transaction details. The sale was conducted pursuant to Section 4(a)(2) of the Securities Act of 1933, exempt from registration. For detailed terms regarding the Series II 2029 Convertible Preferred Shares, investors are referred to the Trust's Form 8-K filed on June 14, 2024.
Key Facts for Investor Verification
- Verify the full terms of the 6.95% Series II 2029 Convertible Preferred Shares in the June 14, 2024 Form 8-K and Exhibit 3.1.
- Confirm that the total issuance of 1,800,000 shares represents the full commitment under the June 10, 2024 Purchase Agreement.
- Note that the $4.65 million proceeds are net of expenses; gross proceeds would be higher ($4.65 million / 200,000 shares = $23.25/share).
- Check the Trust's liquidity position post-issuance in subsequent quarterly filings (10-Q).