Business Context and Reporting Period
This Form 8-K filing by Owl Rock Capital Corporation (Note: Input metadata referenced "Blue Owl Capital Corp," but the filing text identifies the registrant as Owl Rock Capital Corporation) covers the date of August 17, 2021. The report details the creation of a direct financial obligation through the issuance of additional senior notes.
Key Financial Metrics
- New Debt Issuance: $400 million aggregate principal amount of 2.875% Notes due 2028.
- Total Outstanding Notes: $850 million (combining the new issuance with $450 million of existing notes issued on June 11, 2021).
- Interest Rate: 2.875% per annum, payable semiannually.
- Maturity Date: June 11, 2028.
- Accrued Interest: $2,108,333.33 accrued from June 11, 2021, to August 17, 2021, payable on December 11, 2021.
- Revenue/Profit/Cash Flow: The filing text does not provide a clear value for revenue, profit, operating cash flow, or margins.
Material Changes
The primary material change is the expansion of the Company's 2.875% Notes due 2028 series. The aggregate principal amount increased from $450 million to $850 million. The new notes are fungible with the existing notes and rank equally as direct unsecured obligations.
Outlook, Management Commentary, and Risks
- Use of Proceeds: The Company expects to use net proceeds to pay down existing indebtedness, specifically under the SPV Asset Facility III (maturing December 14, 2023) and SPV Asset Facility IV (maturing April 1, 2030).
- Debt Refinancing Context: The facilities being paid down currently bear a weighted average interest rate of 2.3%, compared to the 2.875% rate on the new notes.
- Redemption Terms: The Company may redeem notes at any time at a price equal to the greater of 100% of principal or the present value of remaining payments discounted at the Treasury Rate plus 30 basis points. Redemption at 100% principal is permitted on or after April 11, 2028.
- Change of Control: A change of control repurchase event (triggered by a change of control and a below investment-grade rating) requires the Company to offer to purchase the notes at 100% of principal plus accrued interest.
- Covenants: The Indenture includes covenants regarding compliance with the Investment Company Act of 1940 and financial reporting requirements.
Investor Verification Checklist
- Verify the exact amount of existing indebtedness under SPV Asset Facility III and IV to be repaid with the $400 million proceeds.
- Confirm the impact of the higher interest rate (2.875%) on the new notes versus the lower rate (2.3%) on the facilities being refinanced.
- Review the full text of the Seventh Supplemental Indenture for specific limitations and exceptions to covenants.
- Monitor the Company's credit ratings with Fitch, S&P, and Moody's to assess the risk of a change of control repurchase event.