Brigade Capital Management, LLC, or “Brigade”, an investment advisor
whose affiliates hold approximately 32.8% of the auction rate preferred
shares of PIMCO Income Strategy Fund and approximately 25.9% of the
auction rate preferred shares of PIMCO Income Strategy Fund II
(together, the “Funds”), announced today that Institutional Shareholder
Services, or “ISS”, is recommending that the preferred shareholders of
PFL vote in favor of the election of Alan Bruce Miller and Marti Murray,
Brigade’s nominees, to serve as the preferred shares trustees of PFL and
that the preferred shareholders of PFN vote in favor of the election of
Marti Murray, Brigade’s nominee, to serve as the preferred shares
trustee of PFN.
In its reports dated July 18, 2014, ISS concluded that “[s]upport of
ARPS holders FOR Brigade's nominees, Alan Bruce Miller and Marti Murray,
is warranted given that the nomination of Mr. Miller and Ms. Murray
would further influence the [Funds’ boards] to provide liquidity for the
holders of ARPS and by the [Funds’] failure to provide liquidity to ARPS
holders at levels consistent with, much less higher than, industry
average. Additionally, a WITHHOLD recommendation for the [Funds’]
incumbent nominees also appears warranted under standard ARPS policy for
the same failure to provide ARPS liquidity at or above industry average
levels.” (1)
In response to ISS’ report, Donald E. Morgan, the managing member of
Brigade, issued the following statement: “We are extremely pleased that
ISS is endorsing change at the boards of the Funds by recommending
Brigade’s nominees for election to the boards of the Funds. We believe
that there are very attractive financing alternatives to the preferred
shares and that the Funds’ trustees could pursue these financing
opportunities to provide preferred shareholders with a redemption of or
offer to repurchase their securities and at the same time protect the
interests of the common shareholders. While interest rates remain low by
historical standards, they continue to increase. We believe that the
recent market place changes confirm the wisdom of redemption, yet the
Funds’ trustees continue to resist this logical step already taken by
most other funds. In our view, ISS’ reports provide independent
validation that the boards should take action to immediately redeem the
preferred shares.”
VOTE THE GREEN PROXY CARD TO MAKE A DIFFERENCE IN THE FUNDS’ FUTURE
Brigade urges all preferred shareholders to follow ISS’ recommendation
for change on the boards of the Funds – it is important that the
preferred shareholders of PFL return the GREEN proxy card and
vote FOR Alan Bruce Miller and Marti Murray and that the
preferred shareholders of PFN return the GREEN proxy card and
vote FOR Marti Murray. The preferred shareholders of the Funds SHOULD
NOT RETURN THE WHITE PROXY CARDS or any other proxy cards furnished
to them on behalf of the Funds.
If you have already returned a proxy card, you have every right to
change your vote by signing, dating, and returning a later dated GREEN
proxy card or by voting in person at the upcoming annual meeting.
Investor Contact:
Alliance Advisors LLC
200 Broadacres Drive, 3rd floor
Bloomfield,
NJ 07003
Call Toll Free: 855-973-0092
Banks and Brokers Call
Collect: 973-873-7710
(1) Permission to use quotations was neither sought nor obtained.
About Brigade Capital Management, LP
Brigade Capital Management, LP is an SEC-registered investment advisor
whose products include long/short credit, distressed debt and
traditional high yield. The firm is headquartered in New York and had
$16 billion under management as of July 14, 2014 across its various
products and credit-themed strategies.
Additional Information
THE PARTICIPANTS IN ANY SOLICITATION OF PROXIES RELATING HERETO ARE THE
SAME AS THE PARTICIPANTS IDENTIFIED IN THE DEFINITIVE PROXY STATEMENT
FILED BY BRIGADE WITH RESPECT TO THE FUNDS ON JUNE 30, 2014 (THE “PROXY
STATEMENT”). ACCORDINGLY, PREFERRED SHAREHOLDERS ARE ADVISED TO READ THE
PROXY STATEMENT AND OTHER DOCUMENTS RELATED TO THE SOLICITATION OF
PROXIES BY BRIGADE FROM THE PREFERRED SHAREHOLDERS OF THE FUNDS BECAUSE
THEY CONTAIN IMPORTANT INFORMATION. PREFERRED SHAREHOLDERS MAY OBTAIN A
COPY OF THE PROXY STATEMENT AT NO CHARGE ON THE SECURITIES AND EXCHANGE
COMMISSION'S WEBSITE AT HTTP://WWW.SEC.GOV.
Copyright Business Wire 2014