Eagle Point Credit Company Prices Baby Bonds

Eagle Point Credit (ECC) has priced their previously announced notes due 2031.

The issue prices at 6.75%. The issue will have an early redemption in 2024 with maturity in 2031.

ECC has a number of other issues outstanding which can be seen here.

There will not be any OTC trading in this issue and we should see trading in about a week.

The pricing term sheet can be found here.

7 thoughts on “Eagle Point Credit Company Prices Baby Bonds”

  1. https://www.sec.gov/Archives/edgar/data/1604174/000110465921038727/tm2110055-3_424b2.htm

    In addition, we may also use all or a portion of the net proceeds from the sale of our securities to repay any outstanding indebtedness or preferred stock at the time of the offering, including the Series B Term Preferred Stock, if applicable, on which we intend to pay monthly dividends at a fixed annual rate of 7.75% of the liquidation preference and which we would otherwise be required to redeem on October 30, 2026.

    1. Thanks, Ken.

      Note that ECCB has call protection for 7 1/2 more months, until 10/30/21.
      For those who held this on the March 12 record date, I see 8 more monthly $0.161458 divs, or ~$1.29. March, April, May, June, July, August, Sept, and October dividends to be had before the earliest they could redeem ECCB.
      7.75% coupon X $25 par / 12 months = $0.16145833 monthly div

      ~

      1. Good if purchased at par or less, but Friday was at $25.81= 48¢/share, or 1.86% profit ( 2.79% annualized).
        Need more for my $

    2. Ken – My quick scan capabilities seem to be failing me on this one – where is the language you’re quoting in this document? It certainly isn’t in the Use Of Proceeds section…. I also note they have been selling more ECCB thru ATM this calendar year….. page # or something please… Thanks for the tip.

        1. How interesting….. That language, which is for what I presume would be the original Shelf Registration dated May 29, 2020 is left out of the Use Of Proceeds section of this Prospectus Supplement dated, p s-24 which I would assume is language specific to this particular issue… I wonder which language would take precedence?

          The net proceeds to us of this offering are expected to be approximately $37.5 million (or approximately $43.1 million if the underwriters exercise the overallotment option in full), based on a public offering price of $25 per 2031 Note, after deducting the payment of underwriting discounts and commissions payable by us of approximately $1.2 million (or approximately $1.4 million if the underwriters exercise the overallotment option in full) and estimated offering expenses payable by us of approximately $300,000.
          We intend to use the proceeds from the sale of the 2031 Notes pursuant to this prospectus supplement to acquire investments in accordance with our investment objectives and strategies described in this prospectus supplement and the accompanying prospectus, to make distributions to our stockholders and for general working capital purposes. We currently anticipate that it will take up to three to six months after completion of this offering to invest substantially all of the net proceeds in our targeted investments or otherwise utilize such proceeds, although such period may vary and depends on the availability of appropriate investment opportunities consistent with our investment objectives and market conditions. We cannot assure you we will achieve our targeted investment pace, which may negatively impact our returns. Until appropriate investments or other uses can be found, we will invest in temporary investments, such as cash, cash equivalents, U.S. government securities and other high-quality debt investments that mature in one year or less, which we expect will have returns substantially lower than the returns that we anticipate earning from investments in CLO securities and related investments. Investors should expect, therefore, that before we have fully invested the proceeds of the offering in accordance with our investment objectives and policies, assets invested in these instruments would earn interest income at a modest rate, which may not exceed our expenses during this period.

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