Stellus Capital Investment Corporation (NYSE:SCM) Files An 8-K Submission of Matters to a Vote of Security Holders

Stellus Capital Investment Corporation (NYSE:SCM) Files An 8-K Submission of Matters to a Vote of Security Holders
Item 5.07 Submission of Matters to a Vote of Security Holders.

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Stellus Capital Investment Corporation (the “Company”) held its Annual Meeting of Shareholders on June 28, 2018 (the “Annual Meeting”). At the Annual Meeting, the Company submitted three proposals to the vote of the shareholders, which are described in detail in the Company’s proxy statement dated April 30, 2018. As of April 5, 2018, the record date for the Annual Meeting, 15,953,811 shares of common stock were eligible to be voted.

On June 28, 2018, the proposals were submitted to the vote of the shareholders. Of the shares eligible to be voted, 9,922,039 were voted in person or by proxy in connection with the proposals.

Each of the proposals submitted to a vote of the shareholders of the Company at the Annual Meeting was approved as follows:

Proposal 1: Election of Directors

The Company’s shareholders elected Robert T. Ladd, J. Tim Arnoult and Paul Keglevic as directors to each serve for a three year term, or until their successors are duly elected and qualified. The following votes were taken in connection with this proposal:

Nominee Total Votes For Total Votes Withheld
Robert T. Ladd 9,652,626 269,413
J. Tim Arnoult 7,989,689 1,932,350
Paul Keglevic 7,993,553 1,928,486

Proposal 2: Issuance of Shares Below Net Asset Value

The proposal to authorize the Company, with the approval of the Board, to sell or otherwise issue up to 25% of the Company’s outstanding common stock at an offering price that is below the Company’s then current NAV per share was approved. The following votes were taken in connection with this proposal:

Votes For Votes Against Abstentions
All Shareholders 8,360,612 1,367,335 194,091
All Shareholders Excluding Affiliates* 7,502,239 1,367,335 194,091

*Of the 15,953,811 shares of the Company’s common stock eligible to vote as of the record date for the Annual Meeting, 15,095,438 shares of the Company’s common stock were held by persons or entities not affiliated with the Company.

Proposal 3: Approval of Reduced Minimum Asset Coverage

The proposal to approve the reduction of the Company’s required minimum asset coverage ratio from 200% to 150% with immediate effect was approved. The following votes were taken in connection with this proposal:

For Against Abstain
7,290,636 2,413,137 218,262

Item 8.01. Other Events

At the Meeting (as disclosed above under Item 5.07), the Company’s shareholders approved the application of the modified minimum asset coverage requirements set forth in Section 61(a)(2) of the Investment Company Act of 1940, as amended, to the Company. As a result of such approval, and subject to satisfying certain ongoing disclosure requirements, effective June 28, 2018, the asset coverage ratio test applicable to the Company has been decreased from 200% to 150%, permitting the Company to double the amount of debt it may incur.


About Stellus Capital Investment Corporation (NYSE:SCM)

Stellus Capital Investment Corporation is a closed-end, non-diversified management investment company. The Company originates and invests primarily in private middle-market companies through first lien, second lien, unitranche and mezzanine debt financing, with corresponding equity co-investments. The Company’s investment objective is to maximize the total return to its stockholders in the form of current income and capital appreciation. It invests in various sectors, such as business services, energy, general industrial, government services, healthcare, software and specialty finance. Its investment advisor is Stellus Capital Management, LLC (Stellus Capital Management). Stellus Capital Management is responsible for analyzing investment opportunities, conducting research and performing due diligence on investments, negotiating and structuring the Company’s investments, originating prospective investments, and monitoring its investments and portfolio companies on an ongoing basis.

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