0001504619 2024-07-25 2024-07-25 iso4217:USD 0001504619 false 8-K 2024-07-25 PennantPark Floating Rate Capital Ltd. MD 814-00891 27-3794690 1691 Michigan Avenue Miami Beach FL 33139 (786) 297-9500 false false false false Common stock, par value $0.001 per share PFLT NYSE false <div style="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">On July 25, 2024 (“<div style="text-decoration: underline; letter-spacing: 0px; top: 0px;display:inline;">Closing Date</div>”), PennantPark CLO I, Ltd (the “<div style="text-decoration: underline; letter-spacing: 0px; top: 0px;display:inline;">Issuer</div>”), a wholly-<div style="letter-spacing: 0px; top: 0px;display:inline;">owned </div>and consolidated subsidiary of PennantPark Floating Rate Capital Ltd. (the “<div style="text-decoration: underline; letter-spacing: 0px; top: 0px;display:inline;">Company</div>”), and PennantPark CLO I LLC, a wholly-owned subsidiary of the Issuer (the “<div style="text-decoration: underline; letter-spacing: 0px; top: 0px;display:inline;"><div style="white-space: nowrap; letter-spacing: 0px; top: 0px;display:inline;">Co-Issuer</div></div>” and, together with the Issuer, the “<div style="text-decoration: underline; letter-spacing: 0px; top: 0px;display:inline;">Issuers</div>”), closed the refinancing and upsize of a four-year reinvestment period, twelve-year final maturity $351.0 million debt securitization in the form of a collateralized loan obligation (the “<div style="text-decoration: underline; letter-spacing: 0px; top: 0px;display:inline;">CLO Reset Transaction</div>”). </div> 351000000 <div style="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The CLO Reset Transaction was executed through: (A) the issuance by the Issuers of the following classes of notes pursuant that certain indenture, dated September 19, 2019, by and among the Issuers and U.S. Bank Trust Company, National Association, as amended by the second supplemental indenture, dated June 25, 2024, the “<div style="text-decoration:underline;display:inline;">Indenture</div>”): (i) $203 million of <div style="white-space:nowrap;display:inline;"><div style="white-space:nowrap;display:inline;">A-1-R</div></div> Notes, which bear interest at the three-month secured overnight financing rate (“<div style="text-decoration:underline;display:inline;">SOFR</div>”) plus 1.75%, (ii) $10.5 million of <div style="white-space:nowrap;display:inline;"><div style="white-space:nowrap;display:inline;">A-2-R</div></div> Notes, which bear interest at three-month SOFR plus 1.90%, (iii) $12 million of <div style="white-space:nowrap;display:inline;">Class B-R</div> Notes, which bear interest at three-month SOFR plus 2.05%, (iv) $28 million of <div style="white-space:nowrap;display:inline;">C-R</div> Notes, which bear interest at three-month SOFR plus 2.75% and (v) $21 million of <div style="white-space:nowrap;display:inline;">D-R</div> Notes, which bear interest at three-month SOFR plus 4.30% (collectively, the “<div style="text-decoration:underline;display:inline;">Secured Notes</div>”), (B) the issuance by the Issuer of $64 million of subordinated notes pursuant to the Indenture (the “<div style="text-decoration:underline;display:inline;">Subordinated Notes</div>” and, together with the Secured Notes, the “<div style="text-decoration:underline;display:inline;">Replacement Notes</div>”) and (C) the borrowing by the Issuer of $12.5 million of <div style="white-space:nowrap;display:inline;">Class B-R</div> Loans, which bear interest at three-month SOFR plus 2.05% (the “<div style="text-decoration:underline;display:inline;">Class</div><div style="text-decoration:underline;display:inline;"></div><div style="text-decoration:underline;display:inline;"><div style="white-space:nowrap;display:inline;"> B-R</div> Loans</div>” and, together with the Replacement Notes, the “<div style="text-decoration:underline;display:inline;">Replacement Debt</div>”), pursuant to a credit agreement, dated the Closing Date (the “<div style="text-decoration:underline;display:inline;">Credit Agreement</div>”), by and among the Issuers, the various financial institutions and other persons party thereto, as lenders and U.S. Bank Trust Company, National Association, as loan agent and as trustee. </div> <div style="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">As part of the CLO Reset Transaction, on the Closing Date, the Company and the Issuer also amended and restated the master loan sale agreement, originally dated as of the September 19, 2019 (as amended, the “<div style="text-decoration: underline; letter-spacing: 0px; top: 0px;display:inline;">Amended and Restated Master Loan Sale Agreement</div>”), by and between the Company, the Issuer and PennantPark CLO I Depositor, LLC, a wholly-owned subsidiary of the Company (the “<div style="text-decoration: underline; letter-spacing: 0px; top: 0px;display:inline;">Depositor</div>”), which provided for the sale and contribution of approximately $277 million par amount of middle market loans from the Company to the Issuer on the Closing Date and for future sales and contributions, as applicable, from the Company to the Issuer on an ongoing basis. Such loans constituted part of the initial portfolio of assets securing the Replacement Debt (other than the Subordinated Notes). The Company made customary representations, warranties, and covenants to the Issuer and the Depositor pursuant to the Amended and Restated Master Loan Sale Agreement. </div>