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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): May
22, 2026
ANGEL OAK FINANCIAL STRATEGIES INCOME TERM TRUST
(Exact name of Registrant as Specified in Its Charter)
|
delaware |
|
811-23358 |
|
83-1328557 |
(State or Other Jurisdiction
of Incorporation) |
|
(Commission
File Number) |
|
(IRS Employer
Identification No.) |
|
980 Hammond Drive, Suite 200
Atlanta, Georgia |
|
30328 |
| (Address of Principal Executive Offices) |
|
(Zip Code) |
Registrant’s telephone number, including area
code: (404) 953-4900
N/A
(Former Name or Former Address, if Changed Since Last
Report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |
|
Trading Symbol(s) |
|
Name of each exchange on which registered |
| Common Shares of Beneficial Interest |
|
FINS |
|
New York Stock Exchange |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐ Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company
as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934
(§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant
to Section 13(a) of the Exchange Act. ☐
Item 1.01. Entry into a Material Definitive
Agreement.
Series A Mandatorily Redeemable Preferred Shares
On May 22, 2026, Angel Oak Financial
Strategies Income Term Trust (NYSE: FINS) (the “Fund”) entered into a securities purchase agreement (the “Securities
Purchase Agreement”), by and among the Fund and the purchaser named therein (the “Securities Purchaser”), in connection
with the issuance and sale of 2,000,000 shares of the Fund’s Series A Mandatorily Redeemable Preferred Shares, due April 30, 2031,
liquidation preference of $25.00 (the “MRPS”), in a transaction exempt from registration under the Securities Act of 1933,
as amended (the “Preferred Placement”). The Fund received gross proceeds from the sale of the MRPS of $50 million. The description
above is only a summary of the material provisions of the Securities Purchase Agreement and is qualified in its entirety by reference
to a copy of the Securities Purchase Agreement, which is incorporated by reference and filed as Exhibit 10.1 to this Current Report on
Form 8-K
As a result of its ownership of
MRPS, the Securities Purchaser has the right to elect two members (the “Preferred Trustees”) of the board of trustees of the
Fund (the “Board”). The Board may designate nominees to serve as Preferred Trustees to be elected by the Securities Purchaser.
The Board has nominated Ira P. Cohen to serve as a Preferred Trustee – a Class III Trustee of the Fund. The Securities Purchaser
also has the right to vote with the holders of common shares of the Fund to elect the balance of the Trustees. The description above is
only a summary of the material provisions of the Supplement to Declaration of Trust Relating to Series A Mandatory Redeemable Preferred
Shares and is qualified in its entirety by reference to a copy of the Supplement to Declaration of Trust Relating to Series A Mandatory
Redeemable Preferred Shares, which is incorporated by reference and filed as Exhibit 3.1 to this Current Report on Form 8-K.
FINS intends to use the proceeds of the Preferred Placement
primarily to refinance the Fund’s existing debt and to make new portfolio investments.
Series C Senior Notes
On May
22, 2026, the Fund entered into a notes purchase agreement (the “Note Purchase Agreement”), by and among the Fund and the
purchaser named therein (the “Note Purchaser”), in connection with the private offering of the Fund’s 5.364% Series
C Senior Notes, due July 8, 2030 (the “Series C Notes”), in a transaction exempt from registration under the Securities Act
of 1933, as amended (the “Note Placement”). The Series C Notes bear a fixed interest rate of 5.364% per year and mature on
July 8, 2030, unless redeemed, purchased or repaid prior to such date by FINS in accordance with their terms. The Fund will receive gross
proceeds from the sale of Series C Notes of $40 million.
FINS
intends to use the proceeds of the offering of Series C Notes to redeem the Fund’s 2.35% Series A Senior Notes, which mature July
8, 2026, in accordance with their terms.
Item 3.02. Unregistered
Sales of Equity Securities
The disclosure
required by this Item and included in Item 1.01 of this Current Report is incorporated herein by reference.
Item 5.03. Amendments
to Articles of Incorporation or Bylaws; Change in Fiscal Year
On May
22, 2026, the Fund adopted the Supplement to Declaration of Trust Relating to Series A Mandatory Redeemable Preferred Shares (the “Supplement”)
establishing and fixing the rights and preferences of the MRPS. The Supplement authorized 2,000,000 MRPS, liquidation preference $25.00
per share. A copy of the Supplement is filed herewith as Exhibit 3.1 and incorporated herein by reference.
Item 8.01. Other Events.
At a
November 2025 meeting of the Board, the Board, based on feedback provided to management and the recommendation of management, approved
the calling of the 2026 annual meeting of FINS shareholders at a date and time that is later than 30 days from the date of the anniversary
of the previous year’s annual meeting of shareholders. The description of the November 2025 special meeting of the Board is qualified
in its entirety by reference to the Current Report on Form 8-K filed by FINS on November 26, 2025.
On May
21, 2026, the Board called the annual meeting of FINS shareholders (the “Annual Shareholder Meeting”) and approved its time,
date and location and further approved certain matters to be brought before FINS’s shareholders (the “Shareholders”)
at the annual meeting. The Annual Shareholder Meeting will be at 1:00 p.m. on September 25, 2026, at the offices of Angel Oak Capital
Advisors, LLC, 980 Hammond Drive, Suite 200, Atlanta, Georgia 30328. At the Annual Shareholder Meeting, the Shareholders will be asked
to vote on the following proposals:
| 1. |
To elect each of Keith M. Schappert and Andrea N. Mullins as a Class II Trustee of the Fund; |
| 2. |
In the case of holders of MRPS of the Fund, to elect Ira P. Cohen as a Class III Trustee of the Fund; |
| 3. |
To approve an amendment to the Fund’s Declaration of Trust to lower the threshold for the Shareholders to remove a Trustee for “Cause” as defined in the Declaration of Trust from 75% to 66.67% and lower the threshold for Trustees to remove a Trustee of the Fund for “Cause” from 75% to 66.67% (the “Amendment”); |
| 4. |
To approve adjournments of the Annual Shareholder Meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the Annual Shareholder Meeting to approve the proposals or establish quorum; |
| 5. |
To ratify the selection of Cohen & Company, Ltd. as the Fund’s independent registered public accounting firm for the fiscal year ending January 31, 2027; and |
| 6. |
To approve the transacting of such other business as may properly come before the Annual Shareholder Meeting. |
The description
of the Amendment is qualified in its entirety by reference to the Current Report on Form 8-K filed by FINS on November 26, 2025.
Based
on the terms of the Bylaws, for nominations or other business to be properly brought by Shareholders before the Annual Shareholder Meeting,
notice must be delivered not earlier than the 150th day prior to the date of the Annual Shareholder Meeting and not later than the close
of business on the later of the 120th day prior to the date of the Annual Shareholder Meeting or the tenth day following the day on which
public announcement of the date of such meeting is first made. In addition, the deadline and requirements for shareholder proposals of
business to be conducted at the 2026 annual meeting of the shareholders of FINS must be made in compliance with the applicable securities
laws.
On May
22, 2026, FINS issued a press release. A copy of such press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| 3.1 |
Supplement to Declaration of Trust Relating to Series A Mandatory Redeemable Preferred Shares |
| |
|
| 10.1 |
Securities Purchase Agreement, dated as of May 22, 2026, between the Fund and the Purchasers |
| |
|
| 99.1 |
Press Release dated May 22, 2026 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Angel
Oak Financial Strategies Income Term Trust has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| |
Angel Oak Financial Strategies Income Term Trust |
| |
|
| |
|
| Date: May 26, 2026 |
By: |
/s/ Ward Bortz |
| |
Name: |
Ward Bortz |
| |
Title: |
President |
ANGEL OAK FINANCIAL STRATEGIES INCOME TERM TRUST 8-K
Exhibit 99.1
Angel Oak Financial Strategies Income Term Trust
Issues Mandatorily Redeemable Preferred Shares and New Notes and Sets Record Date and Date for Annual Meeting of Shareholders
ATLANTA – (May 22, 2026) Angel Oak Financial
Strategies Income Term Trust (NYSE – FINS) (the “Fund”) has closed a $50 million private offering of Series A Mandatorily
Redeemable Preferred Shares, due April 30, 2031 (the “MRPS”). The MRPS are rated A3 by Moody’s Investors Service, Inc.
Net proceeds from the offering of the MRPS will be
used primarily to refinance the Fund's existing debt and to make new portfolio investments.
In addition, the Fund has entered into a Notes Purchase
Agreement in connection with a private offering of $40 million of Series C Senior Notes, due July 8, 2030 (“Series C Notes”).
The Series C Notes are rated A1 by Moody’s Investors Service, Inc.
Net proceeds from the offering of the Series C Notes
will be used to redeem the Fund’s 2.35% Series A Senior Notes, which mature July 8, 2026, in accordance with their terms.
The table below summarizes certain key terms of the
Fund’s current leverage:
| |
Amount ($MM) |
Moody's Rating |
Maturity |
| Repurchase Agreement Leverage |
75.5 |
|
|
| 5.364% Series C Notes* |
40 |
A1 |
July 8, 2030 |
| 2.80% Series B Senior Notes |
45 |
A1 |
July 8, 2028 |
| MRPS |
50 |
A3 |
April 30, 2031 |
| |
|
|
|
| * Note the Series C Senior Note has a delayed draw and will replace the maturing Series A Senior Notes in July 2026. |
Angel Oak Capital Advisors, LLC (“Angel Oak”),
the Fund’s investment adviser, anticipates that its strategic use of leverage will be beneficial to income generation due to the
positive interest-rate differential between the interest earned and the cost of leverage. Angel Oak further believes that the MRPS and
Series C Notes will allow the Fund to continue to seek to drive value for Fund shareholders and take advantage of current market conditions
for capital deployment.
Annual Meeting
The Fund’s Board of Trustees (the “Board”)
has called the annual meeting of Fund shareholders (the “Annual Shareholder Meeting”) to be held at 1:00 p.m. on September
25, 2026, at the offices of Angel Oak Capital Advisors, LLC, 980 Hammond Drive, Suite 200, Atlanta, Georgia 30328. The Fund has set the
record date for July 10, 2026.
Based on the terms of the Bylaws, for nominations or
other business to be properly brought before the Annual Shareholder Meeting, notice must be delivered not earlier than the 150th day prior
to the date of the Annual Shareholder Meeting and not later than the close of business on the later of the 120th day prior to the date
of the Annual Shareholder Meeting or the tenth day following the day on which public announcement of the date of such meeting is first
made. In addition, the deadline and requirements for shareholder proposals of business to be conducted at the 2026 annual meeting of the
shareholders of FINS must be made in compliance with the applicable securities laws.
At the Annual Shareholder Meeting, Fund shareholders
(holders of common shares and MRPS) will be asked to vote on the following proposals:
| 1. |
To elect each of Keith M. Schappert and Andrea N. Mullins
as a Class II Trustee of the Fund; |
| 2. |
In the case of holders of the MRPS only, to elect Ira P. Cohen as a
Class III Trustee of the Fund; |
| 3. |
To approve an amendment to the Fund’s Declaration of Trust to
lower the threshold for the Shareholders to remove a Trustee for “Cause,” as defined in the Declaration of Trust, from
75% to 66.67% and lower the threshold for Trustees to remove a Trustee of the Fund for “Cause” from 75% to 66.67%; |
| 4. |
To approve adjournments of the Annual Meeting for the purpose of soliciting
additional proxies if there are not sufficient votes at the Annual Meeting to approve the proposals or establish quorum; |
| 5. |
To ratify the selection of Cohen & Company, Ltd. as the Fund’s
independent registered public accounting firm for the fiscal year ending January 31, 2027; and |
| 6. |
To approve the transacting of such other business as may properly come
before the Annual Shareholder Meeting. |
About FINS
Led by Angel Oak’s experienced financial services
team, the Fund invests predominantly in U.S. financial sector debt as well as selective opportunities across financial sector preferred
and common equity. Under normal circumstances, at least 50% of the Fund’s portfolio is publicly rated investment grade or, if unrated,
judged to be of investment grade quality by Angel Oak.
ABOUT ANGEL OAK
Angel Oak is an investment management firm focused
on providing compelling fixed-income investment solutions to its clients. Backed by a value-driven approach, Angel Oak seeks to deliver
attractive, risk-adjusted returns through a combination of stable current income and price appreciation. Its experienced investment team
seeks the best opportunities in fixed income, with a specialization in mortgage-backed securities and other areas of structured credit.
Information regarding the Fund and Angel Oak can be
found at www.angeloakcapital.com.
Past performance is neither indicative nor a guarantee
of future results. Investors should carefully consider the Fund’s investment objective and policies, risk considerations, charges
and ongoing expenses of an investment before investing. For more information, please contact your investment representative or Destra
Capital Advisors LLC at 877.855.3434.
Contacts
Media:
Bernardo Soriano, Gregory for Angel Oak Capital Advisors
610-200-0570
bsoriano@gregoryagency.com
Company Contact:
Randy Chrisman, Chief Marketing & Corporate IR Officer, Angel Oak Capital Advisors
404-953-4969
randy.chrisman@angeloakcapital.com
