FSFR Fifth Str SR Floating Rate Corp

This Schedule 13D/A (“ Amendment ”) constitutes (i) Amendment No. 8 to the Schedule 13D of Fifth Street Asset Management Inc. originally filed on February 24, 2016, as amended by Amendment No. 1 filed on April 8, 2016, Amendment No. 2 filed on August 16, 2016, Amendment No. 3 filed on August 26, 2016, Amendment No. 4 filed on September 8, 2016, Amendment No. 5 filed on September 14, 2016, Amendment No. 6 filed on October 5, 2016 and Amendment No. 7 filed on December 8, 2016, (ii) Amendment No. 7 to the Schedule 13D of Fifth Street Holdings L.P. originally filed on February 24, 2016, as amended by Amendment No. 1 filed on August 16, 2016, Amendment No. 2 filed on August 26, 2016, Amendment No. 3 filed on September 8, 2016, Amendment No. 4 filed on September 14, 2016, Amendment No. 5 filed on October 5, 2016 and Amendment No. 6 filed on December 8, 2016 and (iii) Amendment No. 15 to the Schedule 13D of Leonard M. Tannenbaum originally filed on March 21, 2014, as amended by Amendment No. 1 filed on March 24, 2014, Amendment No. 2 filed on August 26, 2014, Amendment No. 3 filed on December 22, 2014, Amendment No. 4 filed on May 26, 2015, Amendment No. 5 filed on December 2, 2015, Amendment No. 6 filed on December 31, 2015, Amendment No. 7 filed on February 3, 2016, Amendment No. 8 filed on February 24, 2016, Amendment No. 9 filed on August 16, 2016, Amendment No. 10 filed on August 26, 2016, Amendment No. 11 filed on September 8, 2016, Amendment No. 12 filed on September 14, 2016, Amendment No. 13 filed on October 5, 2016 and Amendment No. 14 filed on December 9, 2016. Except as amended herein, each such prior Schedule 13D, as previously amended, remains in effect. Capitalized terms used herein but not otherwise defined in this Amendment shall have the meaning ascribed to them in the reporting persons’ Schedules 13D as previously amended.

Item 4 of each reporting person’s Schedule 13D is hereby amended to include the information set forth in Item 6 of this Amendment and the following:

Asset Purchase Agreement

On July 13, 2017, Fifth Street Management LLC (“ FSM ”), Oaktree Capital Management, L.P. (“ Oaktree ”), Fifth Street Asset Management Inc. (“ FSAM ”) (solely for the purposes set forth therein) and Fifth Street Holdings L.P. (“ FSH ”) (solely for the purposes set forth therein) entered into an Asset Purchase Agreement (the “ Asset Purchase Agreement ”), pursuant to which, and upon the terms and subject to the conditions set forth therein, FSM will sell, convey, assign and transfer to Oaktree and Oaktree will purchase, acquire and accept from FSM all of FSM’s right, title and interest in specified business records with respect to FSM’s existing investment advisory agreements with each of Fifth Street Finance Corp. (“ FSC ”) and Fifth Street Senior Rate Floating Corp. (“ FSFR ”) for a purchase price of $320 million in cash. The Asset Purchase Agreement also provides for the entry by Oaktree into new investment advisory agreements with each of FSC and FSFR. The shares of common stock of FSFR owned by FSH and Leonard M. Tannenbaum (“ Mr. Tannenbaum ”) are not included in the transaction.

Voting Agreement

Concurrently with the execution of the Asset Purchase Agreement, each of FSH, Mr. Tannenbaum, Leonard M. Tannenbaum Foundation (the “ Tannenbaum Foundation ”), Tannenbaum Family 2012 Trust (the “ Tannenbaum Trust ”) and Oaktree entered into a voting agreement (“ FSFR Voting Agreement ”), dated as of July 13, 2017, with respect to the stockholdings of each of FSH, Mr. Tannenbaum, the Tannenbaum Foundation and the Tannenbaum Trust in FSFR. Pursuant to the FSFR Voting Agreement, each of the aforementioned stockholders of FSFR (the “ Stockholder Signatories ”) agreed to vote their shares of FSFR common stock (i) in favor of approving the proposed new investment advisory agreements with Oaktree and facilitating the election of the four director nominees specified by Oaktree to the board of directors of FSFR and (ii) otherwise at the direction of Oaktree.

The FSFR Voting Agreement terminates upon the earliest of Oaktree no longer advising FSFR, the termination of the Asset Purchase Agreement or, with respect to any Stockholder Signatory, when such Stockholder Signatory no longer owns shares of FSFR common stock. If the Asset Purchase Agreement terminates under certain circumstances where FSAM stockholder approval has not been obtained, then the FSFR Voting Agreement will not terminate until 6 months after the termination of the Asset Purchase Agreement.

Each Stockholder Signatory has agreed not to transfer shares of FSFR common stock prior to the closing of the transactions contemplated by the Asset Purchase Agreement (the “ Closing ”). Following the Closing, subject to a right of first refusal for the benefit of Oaktree, a Stockholder Signatory may transfer shares of FSFR common stock to third parties (these transfers are subject to volume restrictions outside of transfers to certain specified institutional investors).

The foregoing description of the FSFR Voting Agreement and the transactions contemplated thereby does not purport to be complete and is subject to and qualified in its entirety by reference to the FSFR Voting Agreement, a copy of which is filed as Exhibit 99.6 to this Amendment and is incorporated herein by reference.

Item 5 of each reporting person’s Schedule 13D is hereby amended and restated as follows:

The information set forth in rows 7 through 13 of the cover page to this Amendment is incorporated by reference. The percentage set forth in row 13 is based on 29,466,768 shares of common stock outstanding as of May 10, 2017, as reported in the Issuer’s Form 10-Q filed on May 10, 2017. For purposes of Section 13 of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), Mr. Tannenbaum and Oaktree have shared voting and dispositive power over the following shares of FSFR common stock: (i) 5,098,783.622 shares held by Mr. Tannenbaum directly, (ii) 95,634 shares held by the Leonard M. Tannenbaum Foundation, for which Mr. Tannenbaum serves as the President; and (iii) 139,367 shares held directly by the Leonard M. Tannenbaum 2012 Trust (the “ Trust ”) for the benefit of certain members of Mr. Tannenbaum’s family for which Mr. Bernard D. Berman is a trustee and (iv) 2,677,519 shares of FSFR common stock directly held by FSH.

Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

Item 6 of each reporting person’s Schedule 13D is hereby amended and supplemented as follows:

The description of the FSFR Voting Agreement provided in Item 4 above is incorporated herein by reference. 

Pledge and Security Agreement

At the closing of the transactions contemplated by the Asset Purchase Agreement, FSFR and FSH will enter into a Pledge and Security Agreement (“ Security Agreement ”), pursuant to which FSH will grant a security interest in, and pledge and assign as applicable, a number of shares of FSFR common stock equal to $10 million in value, calculated pursuant to Sections 8.1(d) and (e) of the Asset Purchase Agreement. These shares will be used to secure indemnification obligations of FSM and FSH relating to certain SEC investigation-related legal costs and expenses of FSFR and related fees, fines, monetary penalties, deductibles and disgorgements paid by FSFR, net of any disgorgements paid by FSM to FSFR and insurance recoveries received by FSFR.

The Security Agreement contains default and similar provisions that are standard for such agreements.

The foregoing description of the Security Agreement and the transactions contemplated thereby does not purport to be complete and is subject to and qualified in its entirety by reference to the Security Agreement, a copy of which is filed as Exhibit 99.7 to this Amendment and is incorporated herein by reference.

Item 7 of each reporting person’s Schedule 13D is hereby amended to include the following:

SIGNATURES

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: July 17, 2017