The Board of Directors of Source Capital, Inc. (NYSE: SOR) (the
“Fund”), approved a special distribution:
Special Distribution:
Month
Rate per
Common Share
Record Date
Payable Date
December 2024
$TBD*
December 30, 2024
January 9, 2025
*The final rate is estimated to be approximately 1%-3% of net
asset value and is expected to be determined on or about December
27, 2024.
About Source Capital, Inc.
Source Capital, Inc. is a closed-end investment company managed
by First Pacific Advisors, LP. Its shares are listed on the New
York Stock Exchange under the symbol “SOR.” The investment
objective of the Fund is to seek maximum total return for
shareholders from both capital appreciation and investment income
to the extent consistent with protection of invested capital. The
Fund may invest in longer duration assets like dividend paying
equities and illiquid assets like private loans in pursuit of its
investment objective and is thus intended only for those investors
with a long-term investment horizon (greater than or equal to ~5
years).
You can obtain additional information by visiting the website
at https://fpa.com, by email at
crm@fpa.com, toll free by calling 1-800-982-4372, or by
contacting the Fund in writing.
Important Disclosures
You should consider the Fund’s investment objectives, risks,
and charges and expenses carefully before you invest.
Distributions may include ordinary income, net capital gains
and/or returns of capital. Generally, a return of capital would
occur when the amount distributed by the Fund includes a portion of
(or is comprised entirely of) your investment in the Fund in
addition to (or rather than) your pro-rata portion of the Fund’s
net income or capital gains. The Fund’s distributions in any period
may be more or less than the net return earned by the Fund on its
investments, and therefore should not be used as a measure of
performance or confused with “yield” or “income.” A return of
capital is not taxable; rather it reduces a shareholder’s tax basis
in his or her shares of the Fund. If the Fund estimates that a
portion of its distribution may be comprised of amounts from
sources other than net investment income, the Fund will notify
shareholders of the estimated composition of such distribution
through a separate written Section 19 notice. Such notices are
provided for informational purposes only, and should not be used
for tax reporting purposes. Final tax characteristics of all Fund
distributions will be provided on Form 1099-DIV, which is mailed
after the close of the calendar year.
It is important to note that differences exist between the
Fund’s daily internal accounting records and practices, the Fund’s
financial statements prepared in accordance with U.S. GAAP, and
recordkeeping practices under income tax regulations. Please see
the Fund’s most recent shareholder reports for more detailed tax
information.
The Fund’s distribution rate may be affected by numerous
factors, including changes in realized and projected market
returns, Fund performance, and other factors. There can be no
assurance that a change in market conditions or other factors will
not result in a change in the Fund’s distribution rate at a future
time.
As with any stock, the price of the Fund’s common shares will
fluctuate with market conditions and other factors. Shares of
closed-end management investment companies frequently trade at a
price that is less than (a “discount”) or more than (a “premium”)
their net asset value. If the Fund’s shares trade at a premium to
net asset value, there is no assurance that any such premium will
be sustained for any period of time and will not decrease, or that
the shares will not trade at a discount to net asset value
thereafter.
The Fund’s New York Stock Exchange closing market price, net
asset value per share, as well as other information, including
updated portfolio statistics and performance as of the most recent
quarter end are available by visiting the website at
https://fpa.com/funds/overview/source-capital, by email at
crm@fpa.com, toll free by calling 1-800-279-1241 (option 1), or by
contacting the Fund in writing.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of the
securities in any state in which such offer, solicitation or sale
would be unlawful under the securities laws of any such state. In
the event of a tender offer, there may be tax consequences for a
stockholder. For example, a stockholder may owe capital gains taxes
on any increase in the value of the shares over your original
cost.
Investments, including investments in closed-end funds, carry
risks and investors may lose principal value. Capital markets are
volatile and can decline significantly in response to adverse
issuer, political, regulatory, market, or economic developments. It
is important to remember that there are risks inherent in any
investment and there is no assurance that any investment or asset
class will provide positive performance over time. Value style
investing presents the risk that the holdings or securities may
never reach our estimate of intrinsic value because the market
fails to recognize what the portfolio management team considers the
true business value or because the portfolio management team has
misjudged those values. In addition, value style investing may fall
out of favor and underperform growth or other style investing
during given periods. Non-U.S. investing presents additional risks,
such as the potential for adverse political, currency, economic,
social or regulatory developments in a country, including lack of
liquidity, excessive taxation, and differing legal and accounting
standards. Non-U.S. securities, including American Depository
Receipts (ADRs) and other depository receipts, are also subject to
interest rate and currency exchange rate risks.
Fixed income instruments are subject to interest rate, inflation
and credit risks. Such investments may be secured, partially
secured or unsecured and may be unrated, and whether or not rated,
may have speculative characteristics. The market price of the
Fund’s fixed income investments will change in response to changes
in interest rates and other factors. Generally, when interest rates
rise, the values of fixed income instruments fall, and vice versa.
Certain fixed income instruments are subject to prepayment risk
and/or default risk.
Private placement securities are securities that are not
registered under the federal securities laws, and are generally
eligible for sale only to certain eligible investors. Private
placements may be illiquid, and thus more difficult to sell,
because there may be relatively few potential purchasers for such
investments, and the sale of such investments may also be
restricted under securities laws.
The Fund may use leverage. While the use of leverage may help
increase the distribution and return potential of the Fund, it also
increases the volatility of the Fund’s net asset value (NAV), and
potentially increases volatility of its distributions and market
price. There are costs associated with the use of leverage,
including ongoing dividend and/or interest expenses. There also may
be expenses for issuing or administering leverage. Leverage changes
the Fund’s capital structure through the issuance of preferred
shares and/or debt, both of which are senior to the common shares
in priority of claims. If short-term interest rates rise, the cost
of leverage will increase and likely will reduce returns earned by
the Fund’s common stockholders.
This material has been distributed for informational purposes
only and should not be considered as investment advice or a
recommendation of any particular security, strategy or investment
product. No part of this material may be reproduced in any form, or
referred to in any other publication, without express written
permission.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241223014953/en/
Investors: 800-982-4372, crm@fpa.com, www.fpa.com
Media: Tucker Hewes, Hewes Communications, Inc.,
212-207-9451, tucker@hewescomm.com
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