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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE 13D
THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 13)*
PIMCO Income Strategy Fund II
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(Name of Issuer)
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Auction–Rate Preferred Shares
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(Title of Class of Securities)
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72201J203
72201J302
72201J401
72201J500
72201J609
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(CUSIP Number)
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Brigade Leveraged Capital Structures Fund Ltd.
c/o Ogier Fiduciary Services (Cayman) Limited
89 Nexus Way
Camana Bay
Grand Cayman KY1-9007
Attention: Donald E. Morgan, III
Copies to:
Raymond Gietz, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
(212) 310-8000
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(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
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May 3, 2013
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(Date of Event Which Requires Filing of this Statement)
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If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is
the subject of this Schedule 13D, and is filing this schedule because of ss.240.13d-1(e), 240.13d-1(f)
or 240.13d-1(g), check the following box [_].
_________
The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.
*No additional purchases or sales have been made since the date of the reporting persons’ last filing.
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CUSIP No.
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72201J203
72201J302
72201J401
72201J500
72201J609
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1.
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NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
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Brigade Leveraged Capital Structures Fund Ltd.
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2.
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
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(a)[_]
(b)[X]
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3.
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SEC USE ONLY
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4.
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SOURCE OF FUNDS
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WC
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5.
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e)
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[_]
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6.
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CITIZENSHIP OR PLACE OF ORGANIZATION
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Cayman Islands
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
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7.
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SOLE VOTING POWER
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0
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8.
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SHARED VOTING POWER
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1,619*
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9.
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SOLE DISPOSITIVE POWER
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0
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10.
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SHARED DISPOSITIVE POWER
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1,619*
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11.
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
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1,619*
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12.
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES
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[_]
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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25.1%**
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14.
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TYPE OF REPORTING PERSON
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CO
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* Consistent with the Securities and Exchange Commission’s Auction Rate Securities Global Exemptive Relief no action letter issued on September 22, 2008, these amounts reflect Brigade Leveraged Capital Structures Fund Ltd.’s combined holdings in the separate series of auction rate preferred shares of the issuer identified by the CUSIP numbers set forth on the cover page of this Schedule 13D Amendment, which are treated herein as one class of securities.
** Percentage calculation is based on the number of Issuer’s Auction-Rate Preferred Shares outstanding as of January 31, 2013, as reported in the Issuer’s Form N-CSR filed on April 2, 2013.
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CUSIP No.
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72201J203
72201J302
72201J401
72201J500
72201J609
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1.
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NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
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Brigade Capital Management, LLC
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2.
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
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(a)[_]
(b)[X]
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3.
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SEC USE ONLY
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4.
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SOURCE OF FUNDS
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AF
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5.
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e)
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[_]
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6.
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CITIZENSHIP OR PLACE OF ORGANIZATION
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Delaware
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
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7.
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SOLE VOTING POWER
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0
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8.
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SHARED VOTING POWER
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1,669*
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9.
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SOLE DISPOSITIVE POWER
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0
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10.
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SHARED DISPOSITIVE POWER
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1,669*
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11.
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
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1,669*
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12.
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
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[_]
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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25.9%**
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14.
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TYPE OF REPORTING PERSON
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IA
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* Consistent with the Securities and Exchange Commission’s Auction Rate Securities Global Exemptive Relief no action letter issued on September 22, 2008, these amounts reflect Brigade Capital Management, LLC’s combined holdings in the separate series of auction rate preferred shares of the issuer identified by the CUSIP numbers set forth on the cover page of this Schedule 13D Amendment, which are treated herein as one class of securities.
** Percentage calculation is based on the number of Issuer’s Auction-Rate Preferred Shares outstanding as of January 31, 2013, as reported in the Issuer’s Form N-CSR filed on April 2, 2013.
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CUSIP No.
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72201J203
72201J302
72201J401
72201J500
72201J609
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1.
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NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
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Donald E. Morgan, III
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2.
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
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(a)[_]
(b)[X]
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3.
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SEC USE ONLY
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4.
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SOURCE OF FUNDS
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AF
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5.
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e)
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[_]
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6.
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CITIZENSHIP OR PLACE OF ORGANIZATION
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U.S.A.
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
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7.
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SOLE VOTING POWER
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0
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8.
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SHARED VOTING POWER
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1,669*
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9.
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SOLE DISPOSITIVE POWER
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0
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10.
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SHARED DISPOSITIVE POWER
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1,669*
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11.
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
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1,669*
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12.
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
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[_]
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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25.9%**
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14.
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TYPE OF REPORTING PERSON
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IN
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* Consistent with the Securities and Exchange Commission’s Auction Rate Securities Global Exemptive Relief no action letter issued on September 22, 2008, these amounts reflect Donald E. Morgan, III’s combined holdings in the separate series of auction rate preferred shares of the issuer identified by the CUSIP numbers set forth on the cover page of this Schedule 13D Amendment, which are treated herein as one class of securities.
** Percentage calculation is based on the number of Issuer’s Auction-Rate Preferred Shares outstanding as of January 31, 2013, as reported in the Issuer’s Form N-CSR filed on April 2, 2013.
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Item 4.
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Purpose of Transaction.
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Item 4 is supplemented by the following:
The Reporting Persons previously announced their intention to, in an effort to seek new and more effective representation on the Board, nominate a candidate for election as Preferred Shares Trustee at the Issuer’s last annual meeting of shareholders. At the last annual meeting of shareholders which took place on July 31, 2012, Brigade’s nominee and a former partner at Brigade CM, Neal P. Goldman, was elected as Preferred Shares Trustee of the Issuer.
The Reporting Persons continue to believe that the Board is not acting in the best interests of the shareholders of the Issuer (including holders of Shares as well as holders of common shares of the Issuer), and the Reporting Persons intend to, in an effort to seek more effective representation on the Board, nominate one person for election as Preferred Shares Trustee at the Issuer’s upcoming annual meeting of shareholders (the “Annual Meeting”). To that end, on May 3, 2013, Brigade CM and Brigade LCSF sent a notice to the secretary of the Issuer, in accordance with the requirements set forth in the Issuer's fourth amended and restated bylaws, of their decision to nominate Alan Bruce Miller as a Preferred Shares Trustee of the Issuer at the Issuer's Annual Meeting. The Reporting Persons intend to engage in discussions with other shareholders of the Issuer and other relevant parties concerning Mr. Miller’s nomination and the business, operations, board composition, management, strategy and future plans of the Issuer.
The Reporting Persons evaluate their investment in the Shares and purposes for holding such Shares on an ongoing basis and reserve the right to change their intentions and develop plans or proposals at any time, as they deem appropriate.
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Item 6.
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Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.
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Item 6 is supplemented by the following:
The Reporting Persons have entered into a Joint Filing Agreement, a copy of which is attached hereto as Exhibit A.
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Item 7.
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Material to be Filed as Exhibits.
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Exhibit A: Joint Filing Agreement
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May 3, 2013
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(Date)
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Brigade Leveraged Capital Structures Fund Ltd.
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/s/ Donald E. Morgan, III
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(Signature)
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Director
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(Name/Title)
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Brigade Capital Management, LLC*
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By: /s/ Donald E. Morgan, III
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(Signature)
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Managing Member
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(Name/Title)
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/s/ Donald E. Morgan, III*
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(Signature)
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May 3, 2013
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(Date)
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Brigade Leveraged Capital Structures Fund Ltd.
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/s/ Donald E. Morgan, III
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(Signature)
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Director
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(Name/Title)
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Brigade Capital Management, LLC
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By: /s/ Donald E. Morgan, III
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(Signature)
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Managing Member
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(Name/Title)
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/s/ Donald E. Morgan, III
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(Signature)
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