GOLDMAN SACHS BDC, INC. (NYSE:GSBD) Files An 8-K Entry into a Material Definitive Agreement

GOLDMAN SACHS BDC, INC. (NYSE:GSBD) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 – Entry into a Material Definitive Agreement

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On July2, 2018, in connection with a previously announced offering, Goldman Sachs BDC, Inc. (“the Company”) issued $40million aggregate principal amount of 4.50% Convertible Notes due 2022 (the “Convertible Notes”). The Convertible Notes have identical terms, are fungible with and are a part of a single series with the outstanding $115million aggregate principal amount of the Company’s 4.50% Convertible Notes due 2022 issued in October 2016 in a private offering (the “Existing Notes”). The Convertible Notes were issued to an indenture, dated October3, 2016 (the “Indenture”), between the Company and Wells Fargo Bank, National Association, as trustee (the “Trustee”). The sale of the Convertible Notes generated net proceeds of approximately $38.6million, after deducting the underwriters’ discounts and estimated offering expenses payable by the Company.

The Company intends to use 50% of the net proceeds of this offering to pay down debt under its revolving credit facility.

The Convertible Notes will mature on April1, 2022 (the “Maturity Date”), unless previously converted or repurchased in accordance with their terms. The Convertible Notes bear interest at a rate of 4.50%per year payable semiannually in arrears on April1 and October1 of each year, commencing on October1, 2018.

The Convertible Notes will be unsecured obligations of the Company and will rank senior in right of payment to the Company’s future indebtedness that is expressly subordinated in right of payment to the Convertible Notes; equal in right of payment to the Company’s existing and future indebtedness that is not so subordinated; effectively junior in right of payment to any of the Company’s secured indebtedness (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company’s subsidiaries, financing vehicles or similar facilities.

Prior to the close of business on the business day immediately preceding October1, 2021, holders may convert their Convertible Notes only under certain circumstances set forth in the Indenture. On or after October1, 2021 until the close of business on the scheduled trading day immediately preceding the Maturity Date, holders may convert their Convertible Notes at any time. Upon conversion, the Company will pay or deliver, as the case may be, at its election, cash, shares of its common stock or a combination of cash and shares of its common stock. The conversion rate is initially 40.8397 shares of common stock per $1,000 principal amount of Convertible Notes (equivalent to an initial conversion price of approximately $24.49 per share of common stock). The conversion rate will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. In addition, if certain corporate events occur prior to the Maturity Date, the Company will increase the conversion rate for a holder who elects to convert its Convertible Notes in connection with such a corporate event in certain circumstances.

The Company may not redeem the Convertible Notes at its option prior to maturity. No sinking fund is provided for the Convertible Notes. In addition, if certain corporate events occur in respect of the Company, holders of the Convertible Notes may require the Company to repurchase for cash all or part of their Convertible Notes at a repurchase price equal to 50% of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest through, but excluding, the required repurchase date.

The Indenture contains certain covenants, including covenants requiring the Company to comply with Section18(a)(1)(A) as modified by Section61(a)(1) of the Investment Company Act of 1940, as amended, and to provide financial information to the holders of the Convertible Notes and the Trustee if the Company ceases to be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended. These covenants are subject to important limitations and exceptions that are described in the Indenture.

The Convertible Notes were offered and sold to the Registration Statement on Form N-2 (File No.333-224296), the preliminary prospectus supplement filed with the Securities and Exchange Commission on June27, 2018 and the pricing term sheet filed with the Securities and Exchange Commission on June28, 2018. The transaction closed on July2, 2018.

The foregoing description of the Indenture and the Convertible Notes does not purport to be complete and is qualified in its entirety by reference to the full text of the Indenture (including the Form of the 4.50% Convertible Notes due 2022), filed as an exhibit to the Company’s Current Report on Form 8-K filed on October3, 2016, incorporated by reference herein.

This Current Report on Form 8-K is not an offer to sell any securities of the Company and is not soliciting an offer to buy such securities in any state where such offer and sale is not permitted.

Item 1.01 – Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant

The information set forth under Item 1.01 of this Form 8-K is incorporated herein by reference.


Goldman Sachs BDC, Inc., formerly Goldman Sachs Liberty Harbor Capital, LLC, is a closed-end management investment company. The Company is focused on lending to middle-market companies. Its investment objective is to generate current income and capital appreciation through direct originations of secured debt, including first lien, first lien/last-out unitranche and second lien debt, and unsecured debt, including mezzanine debt, as well as through select equity investments. It focuses on lending to the United States middle-market companies. Its portfolio includes first lien/senior secured debt, first lien/last-out unitranche, second lien/senior secured debt, preferred stock, common stock, and investment funds and vehicles. It invests in healthcare providers and services, textiles, apparel and luxury goods, semiconductors and semiconductor equipment, automobiles, and energy equipment and services sectors. Goldman Sachs Asset Management, L.P. is the investment advisor of the Company.

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