Hancock Park Seeks Wind Down Approval With Payouts Estimated at $3.50 to $4.30 a Share

A three-year search for a merger, a portfolio buyer or fresh capital produced no offers, leaving an $11 million note maturing in November as the forcing event.

August 20, 2026

Hancock Park Corporate Income is asking its stockholders to approve an orderly wind down, ending a decade-long attempt to build a retail-distributed middle-market lending vehicle that never reached scale. At an annual meeting set for October 6 in Chicago, holders will vote on a plan of sale and dissolution authorizing the board to sell the entire portfolio without further stockholder consent, and separately on withdrawing the fund’s election to be regulated as a business development company.

The board estimates stockholders will ultimately receive total liquidating distributions of roughly $3.50 to $4.30 per share, based on portfolio liquidation values and wind down cost assumptions as of June 30, with asset sales expected to take 12 to 24 months from approval. That range sits well below the $6.63 net asset value per share the board set in April, and continues a valuation slide the fund has been disclosing since 2024.

A November maturity forces the issue

Hancock Park has an unsecured note maturing on November 27, of which $11.0 million remains outstanding after a $4.0 million redemption on August 10. Management does not believe the lender wants to extend or refinance, and concluded that refinancing at current market rates would erode net investment income to the point of turning it negative.

A secured Banc of California facility carried a minimum quarterly net investment income covenant. The bank declined to modify it when management sought relief in May, and the fund terminated the facility on June 29 given limited usage and annual commitment fees.

A vehicle that never got to scale

Formed in December 2015 with the intention of raising up to $200 million through a continuous offering, Hancock Park took in gross proceeds of only $37.5 million and has not sold a share since June 2023. Meanwhile it kept its quarterly tender program running since 2018, repurchasing $14.1 million of stock through the end of 2025. Inflows stopped, redemptions did not, and the net asset base shrank accordingly. OFS Advisor had supplied $6.3 million in net unreimbursed support through March 31 under expense limitation and support agreements, some of which allowed the fund to pay distributions above earned income.

Three years of alternatives, no bidders

The proxy lays out an unusually detailed account of what the manager tried before landing on liquidation. A non-exclusive placement agreement with GT Securities, signed in July 2023 to reach institutional capital, produced preliminary conversations and no sales before lapsing a year later; management attributed the failure largely to the perpetual structure, against investor preference for term-defined vehicles.

Affiliate mergers were evaluated repeatedly and rejected each time:

• OFS Capital, reviewed on three occasions between August 2024 and January 2026, traded at discounts to net asset value of roughly 30% to 57% across that span — a discount Hancock Park holders would have absorbed. By early 2026 the cancelled merger between Blue Owl Capital Corporation and its non-traded affiliate had become an unhelpful precedent.
• OFS Credit, examined twice in 2025, foundered on structure as much as price: Hancock Park’s senior loan book sat awkwardly against a CLO equity strategy, and its leverage of about 1.2 times debt to equity far exceeded the 0.5 times limit applicable to closed-end funds.

An unaffiliated financial advisor engaged in April 2025 assessed a direct listing, a portfolio sale and a full liquidation. A listing was set aside as raising no new capital and likely to trade at a discount. The advisor identified 14 possible unaffiliated buyers and canvassed them on a no-names basis in February; none expressed interest, citing portfolio size, composition and cost structure. A programmatic capital infusion from another OFS-subadvised fund was evaluated in March and dropped quickly on return grounds.

What holders would be voting for

Approval would let the board dispose of assets in one or more transactions without returning to stockholders each time, pay or reserve for all liabilities including the remaining note, and distribute what is left. The lender has already consented to future asset sales, provided they go to unaffiliated third parties and net proceeds retire the note while it remains outstanding. Wind down costs are estimated at $290,000 to $410,000, inclusive of amounts already spent.

The board also retains the option to move remaining assets into a liquidating trust or convert the fund into a liquidating entity. Shares would then automatically become non-transferable beneficial or ownership interests, and holders would lose quarterly financial reporting; annual statements need not be audited. The board can modify or terminate the plan without a further vote at any point before the notice of dissolution is filed in Maryland.

The vote threshold is worth noting. Hancock Park’s charter requires 80% of votes entitled to be cast to approve a liquidation, but the continuing directors have approved the plan by the requisite two-thirds, dropping the bar to a majority of all votes entitled to be cast. Because the test runs against all outstanding shares rather than those voting, abstentions and broker non-votes count as opposition. There were 1,474,525 shares outstanding on the August 11 record date, held by approximately 193 holders of record and 347 beneficial holders. No appraisal or dissenters’ rights attach.

Dropping the BDC election carries a tax cost

The separate proposal to withdraw the BDC election via Form N-54C is framed as a cost and flexibility measure, freeing the fund from asset coverage tests, affiliated transaction restrictions and 1940 Act governance requirements during the disposition period. Withdrawal will not be effected unless the wind down is also approved.

If withdrawal takes effect before the fund is liquidated for federal tax purposes, Hancock Park will fail to qualify as a regulated investment company for that year and would owe corporate-level tax on its taxable income, including net capital gains — a result that would directly reduce what holders receive.

Fees cut, distributions ending

OFS Advisor has cut its base management fee from 1.25% to 0.75% and waived incentive and capital gains fees through liquidation, with no right to recoup. The advisory and administration agreements are expected to terminate on dissolution. The proxy still carries a conflict disclosure noting that the base fee accrues on total assets and continues through the wind down, giving the adviser an incentive to hold assets longer than holders might prefer.

Regular distributions, already cut sharply, would end. Hancock Park paid $1.0152 per share in each of 2023 and 2024, $0.67125 in 2025, and $0.0801 in the first half of 2026. Holders are also voting on the election of Ashwin Ranganathan as a Class I director, ratification of KPMG, and an adjournment proposal — none of which depend on the wind down passing.