Venture Lending & Leasing VI, Inc. - FORM 10-Q

Attached files

file	filename
EX-32.1 - VLL6INC EXHIBIT 32.1 033115 - Venture Lending & Leasing VI, Inc.	vll603312015ex32110q.htm
EX-32.2 - VLL6INC EXHIBIT 32.2 033115 - Venture Lending & Leasing VI, Inc.	vll603312015ex32210q.htm
EX-31.2 - VLL6INC EXHIBIT 31.2 033115 - Venture Lending & Leasing VI, Inc.	vll603312015ex31210q.htm
EX-31.1 - VLL6INC EXHIBIT 31.1 033115 - Venture Lending & Leasing VI, Inc.	vll603312015ex31110q.htm

FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2015



[ ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ______________

Commission file number 814-00799

Venture Lending & Leasing VI, Inc.

(Exact Name of Registrant as specified in its charter)



Maryland	27-1682622
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

104 La Mesa Drive, Suite 102	Portola Valley, CA 94028
(Address of principal executive offices)	(Zip Code)

(650) 234-4300

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [x] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ ] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer”, and "smaller reporting company” in Rule 12b-2 of the Exchange Act.



Large accelerated filer [ ]	Accelerated filer [ ]	Non-accelerated filer [x]	Smaller reporting company [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [ ] No [x]

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:



Class		Outstanding as of May 14, 2015
Common Stock, $.001 par value		100,000

VENTURE LENDING & LEASING VI, INC.

INDEX



PART I — FINANCIAL INFORMATION

Item 1.	Financial Statements

	Condensed Statements of Assets and Liabilities (Unaudited)
	As of March 31, 2015 and December 31, 2014

	Condensed Statements of Operations (Unaudited)
	For the three months ended March 31, 2015 and 2014

	Condensed Statements of Changes in Net Assets (Unaudited)
	For the three months ended March 31, 2015 and 2014

	Condensed Statements of Cash Flows (Unaudited)
	For the three months ended March 31, 2015 and 2014

	Notes to Condensed Financial Statements (Unaudited)

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 3.	Quantitative and Qualitative Disclosures About Market Risk

Item 4.	Controls and Procedures

PART II — OTHER INFORMATION

Item 1.	Legal Proceedings

Item 1A.	Risk Factors

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds

Item 3.	Defaults Upon Senior Securities

Item 4.	Mine Safety Issues

Item 5.	Other Information

Item 6.	Exhibits

SIGNATURES

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

VENTURE LENDING & LEASING VI, INC.

CONDENSED STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)

AS OF MARCH 31, 2015 AND DECEMBER 31, 2014



	March 31, 2015			December 31, 2014
ASSETS
Loans, at estimated fair value
(Cost of $200,167,406 and $239,908,705)	$	183,481,397		$	227,745,693
Other investment
(Cost of $184,000 and $207,000)	73,461			149,844
Cash and cash equivalents	19,032,323			14,006,961
Other assets	3,006,026			3,851,394

Total assets	205,593,207			245,753,892

LIABILITIES
Borrowings under debt facility	87,700,000			106,550,000
Accrued management fees	1,284,958			1,528,462
Accounts payable and other accrued liabilities	384,411			659,942

Total liabilities	89,369,369			108,738,404

NET ASSETS	$	116,223,838		$	137,015,488

Analysis of Net Assets:

Capital paid in on shares of capital stock	$	241,525,000		$	241,525,000
Return of capital distributions	(105,596,357		)	(89,381,087		)
Accumulated deficit	(19,704,805		)	(15,128,425		)
Net assets (equivalent to $1,162.24 and $1,370.15 per share based on 100,000 shares of capital stock outstanding - See Note 5)	$	116,223,838		$	137,015,488

See notes to condensed financial statements.

VENTURE LENDING & LEASING VI, INC.

CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)

FOR THE THREE MONTHS ENDED MARCH 31, 2015 AND 2014



	For the Three Months Ended March 31, 2015			For the Three Months Ended March 31, 2014

INVESTMENT INCOME:
Interest on loans	$	10,291,534		$	13,777,666
Other interest and other income	58,227			289,015
Total investment income	10,349,761			14,066,681

EXPENSES:
Management fees	1,284,958			1,969,748
Interest expense	771,347			1,100,541
Banking and professional fees	154,565			104,308
Other operating expenses	26,953			49,764
Total expenses	2,237,823			3,224,361
Net investment income	8,111,938			10,842,320

Net realized loss from investments	(1,018,031		)	(1,309,141		)
Net change in unrealized gain (loss) from investments	(4,522,997		)	1,186,141
Net change in unrealized gain (loss) from hedging activities	(53,383		)	(43,108		)
Net realized and change in unrealized loss from investments and hedging activities	(5,594,411		)	(166,108		)

Net increase in net assets resulting from operations	$	2,517,527		$	10,676,212
Net increase in net assets resulting from operations per share	$	25.18		$	106.76
Weighted average shares outstanding	100,000			100,000

See notes to condensed financial statements.

VENTURE LENDING & LEASING VI, INC.

CONDENSED STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)

FOR THE THREE MONTHS ENDED MARCH 31, 2015 AND 2014



	For the Three Months Ended March 31, 2015			For the Three Months Ended March 31, 2014
Net increase in net assets resulting from operations:
Net investment income	$	8,111,938		$	10,842,320
Net realized loss from investments	(1,018,031		)	(1,309,141		)
Net change in unrealized gain (loss) from investments	(4,522,997		)	1,186,141
Net change in unrealized gain (loss) from hedging activities	(53,383		)	(43,108		)

Net increase in net assets resulting from operations	2,517,527			10,676,212

Distributions of income to shareholder	(7,093,907		)	(9,233,030		)
Return of capital to shareholder	(16,215,270		)	(10,913,557		)
Decrease in capital transactions	(23,309,177		)	(20,146,587		)

Total decrease	(20,791,650		)	(9,470,375		)

Net assets
Beginning of period	137,015,488			194,365,857

End of period	$	116,223,838		$	184,895,482

See notes to condensed financial statements.

VENTURE LENDING & LEASING VI, INC.

CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE THREE MONTHS ENDED MARCH 31, 2015 AND 2014



	For the Three Months Ended March 31, 2015			For the Three Months Ended March 31, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net increase in net assets resulting from operations	$	2,517,527		$	10,676,212
Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities:
Net realized loss from investments	1,018,031			1,309,141
Net change in unrealized (gain) loss from investments	4,522,997			(1,186,141		)
Net change in unrealized (gain) loss from hedging activities	53,383			(257,041		)
Receipt of equity securities as payment for waiver	—			(283,366		)
Amortization of deferred costs related to borrowing facility	56,998			122,950
Net (increase) decrease in other assets	811,370			(77,439		)
Net decrease in accounts payable, other accrued liabilities, and accrued management fees	(519,035		)	(349,892		)
Origination of loans	(2,112,500		)	(31,830,000		)
Principal payments on loans	39,582,754			45,316,057
Acquisition of equity securities	(56,163		)	(2,673,354		)
Net cash provided by operating activities	45,875,362			20,767,127
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distribution to shareholder	(22,000,000		)	(16,800,000		)
Repayment of debt facility	(18,850,000		)	(8,400,000		)

Net cash used in financing activities	(40,850,000		)	(25,200,000		)
Net increase (decrease) in cash and cash equivalents	5,025,362			(4,432,873		)
CASH AND CASH EQUIVALENTS:
Beginning of period	14,006,961			35,377,189
End of period	$	19,032,323		$	30,944,316
SUPPLEMENTAL DISCLOSURES:
CASH PAID DURING THE PERIOD:
Interest	$	751,005		$	1,045,056
Settlement under interest rate swap agreement	$	—		$	300,149
NON-CASH ACTIVITIES:
Distributions of equity securities to shareholder	$	1,309,177		$	3,346,587
Receipt of equity securities as repayment of loans	$	1,253,014		$	389,867

See notes to condensed financial statements.

VENTURE LENDING & LEASING VI, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)


1.	ORGANIZATION AND OPERATIONS OF THE FUND

Venture Lending & Leasing VI, Inc. (the “Fund”), was incorporated in Maryland on January 11, 2010 as a nondiversified closed-end management investment company electing status as a business development company (“BDC”) under the Investment Company Act of 1940, as amended ("1940 Act") and is managed by Westech Investment Advisors, LLC, formerly known as Westech Investment Advisors, Inc. (“Manager” or “Management”). The Fund will be dissolved on December 31, 2020 unless an election is made to dissolve earlier by the Board of Directors of the Fund (the “Board”). One hundred percent of the stock of the Fund is held by Venture Lending & Leasing VI, LLC (the “Company”). Prior to commencing its operations on June 29, 2010, the Fund had no operations other than the sale to the Company of 100,000 shares of common stock, $0.001 par value for $25,000 in January 2010. This issuance of stock was a requirement in order to apply for a finance lender's license from the California Commissioner of Corporations, which was obtained on April 13, 2010.

In the Manager's opinion, the accompanying financial statements include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of financial position and results of operations for interim periods. Certain information and note disclosures normally included in audited annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted; however, the Fund believes that the disclosures made are adequate to make the information presented not misleading. The interim results for the three months ended March 31, 2015 are not necessarily indicative of what the results would be for a full year. It is suggested that these financial statements be read in conjunction with the financial statements and the notes included in the Fund's Annual Report on Form 10-K for the year ended December 31, 2014.


2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash on hand and money market mutual funds with maturities of 90 days or less. Money market mutual funds held as cash equivalents are valued at their most recently traded net asset value.

Interest Income

Interest income on loans is recognized using the effective interest method including amounts from the amortization of discounts attributable to equity securities received as part of the loan transaction. Additionally, fees received as part of the transaction are added to the loan discount and amortized over the life of the loan.

Valuation Procedures

The Fund accounts for loans at fair value in accordance with the “Valuation Methods” below. All valuations are determined under the direction of the Manager, in accordance with this policy.

The Fund's loans are valued in connection with the issuance of its periodic financial statements, the issuance or repurchase of the Fund's shares at a price equivalent to the current net asset value per share, and at such other times as

required by law. On a quarterly basis, Management submits to the Board a “Valuation Report,” which details the rationale for the valuation of investments.

As of March 31, 2015 and December 31, 2014, the financial statements include nonmarketable investments of $183.5 million and $227.7 million, respectively (or 89% and 93% of total assets, respectively), with fair values determined by the Manager in the absence of readily determinable market values. Because of the inherent uncertainty of these valuations, estimated fair values of such investments may differ significantly from the values that would have been used had a ready market for the securities existed, and the differences could be material. Below is the information used by the Manager in making these estimates.

Loans

The Fund defines fair value as the price that would be received to sell an asset or paid to lower a liability in an orderly transaction between market participants at the measurement date. There is no secondary market for the loans made by the Fund to borrowers, hence Management determines fair value based on hypothetical markets. Venture loans are generally held to maturity and are recorded at estimated fair value. The determination of fair value is based on a number of factors including the amount for which an investment could be exchanged in a current sale, which assumes an orderly disposition over a reasonable period other than in a forced sale. Management considers the fact that no ready market exists for substantially all of the investments held by the Fund. Management determines whether to adjust the estimated fair value of a loan based on a number of factors including but not limited to the borrower's payment history, available cash and “burn rate,” revenues, net income or loss, the likelihood that the borrower will be able to secure additional financing in the future, as well as an evaluation of the general interest rate environment. The amount of any valuation adjustment considers liquidation analysis and is determined based upon a credit analysis of the borrower and an analysis of the expected recovery from the borrower, including consideration of factors such as the nature and quality of the Fund's security interests in collateral, the estimated value of the Fund's collateral, the size of the loan, and the estimated time that will elapse before the Fund achieves a recovery. Management has evaluated these factors and has concluded that the effect of deterioration in the quality of the underlying collateral, increase in the size of the loan and increase in the estimated time to recovery would have the effect of lowering the value of the current portfolio of loans.

Non-accrual Loans

The Fund's policy is to place a loan on non-accrual status when the loan stops performing and Management deems that it is unlikely that the loan will return to performing status. When a loan is placed on non-accrual status, all interest previously accrued but not collected is reversed for the quarter in which the loan was placed on non-accrual status. Any uncollected interest related to quarters prior to when the loan was placed on non-accrual status is added to the principal balance, and the aggregate balance of the principal and interest is evaluated in accordance with the policy for valuation of loans in determining Management's best estimate of fair value. Interest received by the Fund on non-accrual loans will be recorded on a cash basis.

If a borrower of a non-accrual loan resumes making regular payments and Management deems that the borrower has sufficient resources that it is unlikely the loan will return to non-accrual status, the loan is re-classified back to accrual or performing status. Interest that would have been accrued during the non-accrual status will be added back to the remaining payment schedule, and thus changing the effective interest rate.

As of March 31, 2015, loans with a cost basis of $21.2 million and a fair value of $7.4 million, have been classified as non-accrual. As of December 31, 2014, loans with a cost basis of $18.5 million and a fair value of $7.3 million, have been classified as non-accrual.

Warrants and Stock

Warrants and stock that are received in connection with loan transactions generally will be assigned a fair value at the time of acquisition. These securities are then distributed by the Fund to the Company at the assigned value. Warrants are valued based on a modified Black-Scholes option pricing model which takes into account among other factors underlying stock value, expected term, volatility and the risk-free interest rate.

Underlying asset value is estimated based on information available, including information regarding recent rounds of funding of the portfolio company, or the publicly-quoted stock price at the end of the financial reporting period for warrants for comparable publicly-quoted securities.

Volatility, or the amount of uncertainty or risk about the size of the changes in the warrant price, is based on an index of publicly traded companies grouped by industry and which are similar in nature to the underlying client companies issuing the warrant (“Industry Index”). The volatility assumption for each Industry Index is based on the average volatility for individual public companies within the client company's industry for a period of time approximating the expected life of the warrants. A hypothetical increase in the estimated initial term of the warrants used in the modified Black-Scholes option pricing model would have the effect of increasing the value of the warrants.

The remaining expected lives of warrants are based on historical experience of the average life of the warrants, as warrants are often exercised in the event of acquisitions, mergers, or initial public offerings and terminated due to events such as bankruptcies, restructuring activities, or additional financings. These events cause the expected term to be less than the remaining contractual term of the warrants. For the three months ended March 31, 2015 and and March 31, 2014, the Fund assumed the average duration of a warrant is 3.5 years and 3 years, respectively. The effect of a hypothetical increase in the estimated initial term of the warrants used in the modified Black-Scholes option pricing model would have the effect of increasing the value of the warrants.

The risk-free interest rate is derived from the constant maturity tables issued by the U.S. Treasury Department. The effect of a hypothetical increase in the estimated risk-free rate used in the modified Black-Scholes option pricing model would have the effect of increasing the value of the warrants.

On an annual basis, the Fund engages an independent valuation company to provide valuation assistance to value the warrants which are received as part of loan consideration. These warrants are immediately distributed to the Fund’s shareholder. This independent third party evaluates the Fund's valuation methodology and assumptions for reasonableness from the perspective of a market participant. The independent third party also calculates several of the inputs used such as volatility and risk free rate. Upon the receipt of such data, a sample test is performed to ensure the accuracy of the independent calculations and that the source of data is reliable and consistent with the way in which the calculations were made in prior periods. Such inputs are entered into the database with a second review to ensure the accuracy of the input information. All calculations of warrant values are performed by one employee and reviewed by a second party. The inputs of the modified Black-Scholes option pricing model are reevaluated every quarter.

Other Assets and Liabilities

Other Assets include costs incurred in conjunction with borrowings under the Fund's debt facility and are stated at initial cost, with the exception of the interest rate cap which is marked to market. The costs are amortized over the term of the facility.

As of March 31, 2015 and December 31, 2014, based on borrowing rates available to the Fund, which are Level 2 inputs, the estimated fair values of the borrowings under the debt facility were $87.7 million and $106.6 million, respectively.

Commitment Fees

Unearned income and commitment fees on loans are recognized in interest on loans using the effective interest method over the term of the loan. Commitment fees are carried as liabilities when received for commitments upon which no draws have been made. When the first draw is made, the fee is treated as unearned income and is recognized as described above. If a draw is never made, the forfeited commitment fee less any applicable legal costs becomes recognized as other income after the commitment expires.

Interest Rate Cap Agreements

On September 30, 2014, the Fund entered into interest rate cap agreements which are primarily valued on the basis of the future expected interest rates on the notional principal balance remaining, which is comparable to what a prospective acquirer would pay on the measurement date. Valuation pricing models consider inputs such as forward rates, anticipated interest rate volatility relating to the reference rate, as well as time value and other factors underlying cap instruments. The contracts are recorded at fair value in either other assets or accounts payable and other accrued liabilities in the Condensed Statements of Assets and Liabilities, depending on whether the value of the contract is in favor of the Fund or the counter party. The changes in fair value are recorded in Net change in unrealized gain (loss) from hedging activities in the Condensed Statements of Operations.

Deferred Bank Fees

The deferred bank fees and costs associated with the debt facility have been allocated over the estimated life of the facility, which was originally determined to be January 2014. Starting in October 2011, the estimated life of the facility changed to September 2014. Through September 30, 2014, the deferred bank fees and costs associated with the September 30, 2014 extended expiration date previously had been amortized over the estimated life of the facility.

The debt facility was extended again on September 23, 2014 and then on September 30, 2014, it was amended, restated and renewed through March 23, 2017. Deferred bank fees and costs associated with the renewal of the debt facility are being amortized over the estimated life of the renewed facility through March 23, 2017.

Through March 31, 2015, the deferred bank fees and costs associated with the September 30, 2014 extended expiration date previously had been amortized over the estimated life of the facility. The amortization of these costs was recorded as interest expense in the Condensed Statement of Operations (see Note 6).

Recent Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board (“FASB”) issued ASU 2015-03 Interest-Imputation of Interest, Simplifying the Presentation of Debt Issuance Costs, which changes the presentation of debt issuance costs in financial statements. Under the ASU, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. The amended

guidance is effective for the Fund’s interim and annual periods beginning on January 1, 2016. Management does not

expect the adoption of this guidance to significantly impact the Fund’s financial position or results of operations.

Tax Status

The Fund has elected to be treated as a Regulated Investment Company ("RIC") under Subchapter M of the Internal Revenue Code (the "Code") and operates in a manner so as to qualify for the tax treatment applicable to RICs.

In order to qualify for favorable tax treatment as a RIC, the Fund is required to distribute annually to its shareholder at least 90% of its investment company taxable income, as defined by the Code. To avoid federal excise taxes, the Fund must distribute annually at least 98% of its ordinary income and 98.2% of net capital gains from the current year and any undistributed ordinary income and net capital gains from the preceding years. The Fund, at its discretion, may

carry forward taxable income in excess of calendar year distributions and pay a 4% excise tax on this income. If the Fund chooses to do so, all other things being equal, this would increase expenses and reduce the amount available to be distributed to shareholder. The Fund will accrue excise tax on estimated undistributed taxable income as required.

Dividends from net investment income and distributions from net realized capital gains are determined in accordance with U.S. federal income tax regulations, which may differ from those amounts determined in accordance with accounting principles generally accepted in the United States of America ("GAAP"). These book/tax differences are either temporary or permanent in nature. To the extent these differences are permanent, they are charged or credited to paid-in-capital or accumulated net realized gain (loss), as appropriate, in the period that the differences arise. Temporary and permanent differences are primarily attributable to differences in the tax treatment of certain loans and the tax characterization of income and non-deductible expenses. These differences are generally determined in conjunction with the preparation of the Fund's annual RIC tax return.

Book and tax basis differences relating to shareholder dividends and distributions and other permanent book and tax differences are reclassified among the Fund's capital accounts. In addition, the character of income and gains to be distributed is determined in accordance with income tax regulations that may differ from GAAP.

The Fund may pay distributions in excess of its taxable net investment income. This excess would be a tax-free return of capital in the period and reduce the shareholder's tax basis in its shares. The cumulative amount is disclosed on the Condensed Statements of Assets and Liabilities as return of capital distributions. Cumulative return of capital distributions were $105.6 million and $89.4 million as of March 31, 2015 and December 31, 2014, respectively. As of March 31, 2015, the Fund had no uncertain tax positions.

The Fund's tax years open to examination by major jurisdictions are 2011 and forward.


3.	SUMMARY OF INVESTMENTS

Loans generally are made to borrowers pursuant to commitments whereby the Fund agrees to finance assets and provide working or growth capital up to a specified amount for the term of the commitment, upon the terms and subject to the conditions specified by such commitment. As of March 31, 2015, the Fund's investments in loans were primarily to companies based within the United States and were diversified among borrowers in the industry segments shown below. The percentage of net assets that each industry group represents is shown with the industry totals below (the sum of the percentages does not equal 100 percent because the percentages are based on net assets as opposed to total loans). All loans are senior to unsecured creditors except where indicated.

The Fund defines fair value as the price that would be received to sell an asset or paid to settle a liability in an orderly transaction between market participants at the measurement date; that is, an exit price. The exit price assumes the asset or liability was exchanged in an orderly transaction; it was not a forced liquidation or distressed sale.

Loan balances are summarized by borrower. Typically a borrower's balance will be composed of several loans drawn under a commitment made by the Fund with the interest rate on each loan fixed at the time each loan is funded. Each loan drawn under a commitment may have a different maturity date and amount. For the three months ended March 31, 2015 and 2014, the weighted-average interest rate on the performing loans was 18.97% and 19.02%, respectively. These rates were inclusive of both cash and non-cash interest income. For the three months ended March 31, 2015 and 2014, the weighted-average interest rate on the cash portion of the interest income was 13.57% and 14.37%, respectively. Interest is calculated using the effective interest method, and rates earned by the Fund will fluctuate based on many factors including early payoffs, volatility of values ascribed to warrants and new loans funded during the period.

The risk profile of a loan changes when events occur that impact the credit analysis of the borrower and loan as described in our loan accounting policy. Such changes result in the fair value being adjusted from par value of the individual loan. Where the risk profile is consistent with the original underwriting, which is primarily the case for this loan portfolio, the par value of the loan will approximate fair value.

All loans as of March 31, 2015 were to non-affiliates and consisted of the following:



		Estimated Fair	Par Value	Final
Borrower		Value 3/31/15	Value 3/31/15	Maturity Date
Computers & Storage
Clustrix, Inc.		$ 1,928,409	$ 1,928,409	5/1/2017
Connected Data, Inc.		1,662,315	1,662,315	5/1/2017
D-Wave Systems, Inc.		1,466,442	1,466,442	2/1/2017
Gridstore, Inc.		1,295,818	1,295,818	6/1/2017
Veloxum, Inc.		416,093	416,093	*
Vidcie, Inc.		342,550	342,550	12/1/2015
Subtotal:	6.1%	$ 7,111,627	$ 7,111,627

Enterprise Networking
Apprion, Inc.		$ 445,253	$ 445,253	4/1/2016
Splashtop, Inc.		951,322	951,322	5/1/2016
Subtotal:	1.2%	$ 1,396,575	$ 1,396,575

Internet
Behalf, Inc.		$ 1,351,438	$ 1,351,438	5/1/2017
Better Doctor, Inc.		258,195	258,195	6/1/2016
Change.org, Inc.		1,708,354	1,708,354	11/1/2016
CloudTalk, Inc.		5,000	124,008	*
CustomMade, Inc.		1,561,376	1,561,376	5/1/2017
DailyFeats, Inc.		166,920	166,920	1/1/2016
Desti, Inc.		38,983	43,283	*
Digital Caddies, Inc.		0	872,256	*
FanBridge, Inc.		453,896	643,896	*
FanDuel, Inc.		1,223,376	1,223,376	9/1/2016
Fast Labs, Inc.		332,522	332,522	3/1/2017
FlipTop, Inc.		510,524	510,524	2/1/2018
Giddy Apps, Inc.		944,997	944,997	12/1/2017
Giga Omni Media, Inc.		278,008	2,378,008	*
Giveforward, Inc.		554,654	554,654	7/1/2017
Good Eggs, Inc.		257,656	257,656	6/1/2016
Grovo Learning, Inc.		792,736	792,736	3/1/2017
HEXAGRAM 49, Inc.		321,356	321,356	1/1/2016
Inside Vault, Inc.		395,261	395,261	5/1/2017
Jun Group, LLC		641,940	641,940	2/1/2017
KargoCard, Co.		324,172	324,172	1/1/2016
Kitsy Lane, Inc.		191,585	191,585	12/1/2016
Kiwi Crate, Inc.		936,167	936,167	4/1/2018
Komli Media, Inc.		2,176,199	2,176,199	11/1/2015
Kulbyt, Inc.		67,234	67,234	8/1/2015
Lenddo International		804,742	804,742	12/1/2015
Lightside Games, Inc.		135,230	208,230	*



LocalResponse, Inc.		267,963	267,963	3/1/2016
Madison Reed, Inc.		1,417,473	1,417,473	6/1/2018
MediaSpike, Inc.		51,693	176,693	*
MeetMe, Inc.		1,100,712	1,100,712	4/1/2016
Minno, Inc.		1,601,177	1,601,177	3/1/2018
Moda Operandi, Inc.		95,556	95,556	12/1/2015
Monetate, Inc.		3,118,574	3,118,574	6/1/2018
Navigating Cancer, Inc.		737,899	737,899	7/1/2016
Osix Corp.		244,727	244,727	10/1/2016
Piryx, Inc.		1,238,817	1,518,817	*
Pixalate, Inc.		364,994	364,994	3/1/2017
Playstudios, Inc.		3,104,482	3,104,482	6/1/2018
Pleying, Inc.		165,252	165,252	12/1/2016
Quantcast Corp.		5,473,212	5,473,212	4/1/2017
Quri, Inc.		1,924,853	1,924,853	6/1/2018
Radius Intelligence, Inc.		1,625,219	1,625,219	10/1/2017
Relay Network, LLC		184,626	184,626	7/1/2015
Retail Innovation Group		1,383,243	1,383,243	7/1/2016
Rivet Games, Inc.		108,082	175,082	*
The SavvySource For Parents, Inc.		274,883	274,883	12/1/2016
Schooltube, Inc.		0	108,222	*
ServiceMarketplace, Inc.		205,926	205,926	7/1/2017
Session M, Inc.		1,399,583	1,399,583	2/1/2017
Smart Lunches, Inc.		134,005	134,005	6/1/2016
Sociable Labs, Inc.		266,736	266,736	7/1/2016
The Black Tux, Inc.		725,101	725,101	2/1/2018
The Lucky Group Inc.		2,700,103	5,400,103	8/1/2018
UserVoice, Inc.		217,136	217,136	11/1/2015
Weddington Way, Inc.		694,899	694,899	11/1/2016
WHI, Inc.		1,721,578	1,721,578	7/1/2017
YouDocs Beauty, Inc.		971,998	1,171,998	5/1/2018
Subtotal:	43.0%	49,953,023	$ 56,791,809

Medical Devices
AxioMed, Inc.		$ 14,238	$ 1,560,238	*
Blockade Medical, LLC		468,213	468,213	9/1/2017
Cayenne Medical, Inc.		4,458,373	4,458,373	12/1/2017
HourGlass Technologies, Inc.		243,351	869,351	*
MimOSA, Inc.		202,437	202,437	12/1/2016
Redox Medical, Inc.		500,000	3,600,000	*
Subtotal:	5.1%	$ 5,886,612	$ 11,158,612

Other Healthcare
Cogito Health, Inc.		$ 465,226	$ 465,226	4/1/2017
Health Integrated, Inc.		1,913,481	1,913,481	10/1/2017
HealthEquityLabs, Inc.		932,835	932,835	6/1/2018
Mulberry Health, Inc.		4,483,759	4,483,759	12/1/2017



Physician Software Systems, LLC		450,191	450,191	7/1/2017
Practice Fusion, Inc.		3,771,642	3,771,642	6/1/2016
Project Healthy Living, Inc.		786,520	786,520	10/1/2016
Therapydia, Inc.		551,703	551,703	10/1/2017
Urgent Care Centers of New England, Inc.		2,363,144	2,363,144	4/1/2018
Subtotal:	13.5%	$ 15,718,501	$ 15,718,501

Other Technology
21e6, Inc.		$ 11,825,686	$ 11,825,686	8/1/2017
Automatic Labs, Inc.		679,826	679,826	12/1/2016
Beeline Bikes, Inc.		124,805	124,805	6/1/2017
Daylight Solutions, Inc.		2,095,791	2,095,791	8/1/2017
Ecologic Brands, Inc.		575,483	575,483	6/1/2017
General Assembly, Inc.		1,740,206	1,740,206	12/1/2016
InsideTrack, Inc.		1,260,865	1,260,865	9/1/2017
LanzaTech New Zealand, Ltd.		6,689,741	6,689,741	7/1/2016
Lumo BodyTech, Inc.		1,186,681	1,186,681	12/1/2017
Neuehouse, LLC		3,727,334	3,727,334	7/1/2017
nWay, Inc.		1,303,691	1,303,691	3/1/2018
Pinnacle Engines, Inc.		1,129,770	1,129,770	12/1/2017
PLAE, Inc.		424,554	424,554	6/1/2017
Prana Holdings, Inc.		3,811,300	3,811,300	7/1/2016
Scoot Networks, Inc.		377,431	377,431	3/1/2017
Skully Helmets, Inc.		217,647	217,647	7/1/2017
Sproutling, Inc.		655,767	655,767	9/1/2017
Thoughtful Media Group, Inc.		165,808	345,808	*
Tribogenics, Inc.		1,018,156	1,018,156	9/1/2016
YPX Cayman Holdings Co.		796,365	796,365	4/1/2016
ZeaChem, Inc.		110,960	3,812,960	*
Subtotal:	34.4%	$ 39,917,867	$ 43,799,867

Security
Agari Data, Inc.		$ 999,703	$ 999,703	9/1/2017
Guardian Analytics, Inc.		2,870,693	2,870,693	1/1/2018
Uplogix, Inc.		1,207,779	1,207,779	5/1/2017
Venafi, Inc.		3,406,919	3,406,919	6/1/2017
Subtotal:	7.3%	$ 8,485,094	$ 8,485,094

Software
3Scale, Inc.		$ 674,190	$ 674,190	9/1/2017
AcousticEye, Ltd.		116,941	116,941	12/1/2015
Appconomy, Inc.		826,362	1,839,362	*
Apportable, Inc.		751,949	751,949	3/1/2017
Atigeo, LLC.		2,810,298	2,810,298	9/1/2017
Beanstock Media, Inc.		1,340,196	1,340,196	12/1/2018
BlazeMeter, Inc.		904,527	904,527	1/1/2018



Brightpearl, Inc.		388,535	388,535	6/1/2016
ClearPath, Inc.		234,065	234,065	5/1/2016
Clypd, Inc.		505,095	505,095	11/1/2016
Corduro, Inc.		34,712	124,712	*
DropThought, Inc.		425,303	425,303	12/1/2016
eCommera, Inc.		3,440,454	3,440,454	3/1/2017
Encoding.com, Inc.		457,087	457,087	11/1/2016
gloStream, Inc.		901,560	1,201,560	*
Innerworkings Holdings, Ltd.		4,845	332,067	*
Intalio, Inc.		179,413	179,413	8/1/2015
MediaPlatform, Inc.		469,711	469,711	9/1/2016
Mintigo, Inc.		1,363,714	1,363,714	1/1/2018
Nectar Holdings, Inc.		1,128,261	1,128,261	12/1/2017
OrderGroove, Inc.		806,682	806,682	12/1/2017
Palantir Technologies, Inc.		5,710,926	5,710,926	4/1/2016
Pursway, Inc.		1,012,938	1,012,938	7/1/2016
SCVNGR, Inc.		1,600,861	1,600,861	10/1/2016
SnapLogic, Inc.		1,586,208	1,586,208	7/1/2016
SoundHound, Inc.		3,256,049	3,256,049	5/1/2017
STG-Impact Holdings Corp.		4,828,504	4,828,504	3/1/2016
StreetLight Data, Inc.		574,319	574,319	4/1/2017
Superfish, Inc.		211,258	211,258	10/1/2015
Top Hat Monocle Corp.		549,150	549,150	7/1/2016
Vuemix, Inc.		20,319	20,319	8/1/2015
Workspot, Inc.		145,058	145,058	9/1/2016
Xceedium, Inc.		37,716	37,716	4/1/2015
ZeroTurnaround USA, Inc.		1,434,085	1,434,085	6/1/2018
Subtotal:	33.3%	$ 38,731,291	$ 40,461,513

Technology Services
Akademos, Inc.		$ 824,042	$ 824,042	6/1/2017
Amped, Inc.		1,374,774	1,374,774	11/1/2017
BidPal, Inc.		525,513	525,513	4/1/2016
Blazent, Inc.		489,429	489,429	5/1/2016
Blue Technologies Limited		642,629	642,629	6/1/2017
BountyJobs, Inc.		626,512	626,512	10/1/2017
Callisto Media, Inc.		498,867	498,867	9/1/2016
FSA Store, Inc.		1,128,236	1,128,236	9/1/2017
Grassroots Unwired, Inc.		62,751	62,751	8/1/2016
Maxi Mobility, Inc.		133,738	133,738	7/1/2016
Rated People, Ltd.		1,124,901	1,469,902	*
Stackstorm, Inc.		263,507	263,507	8/1/2017
TiqIQ, Inc.		232,604	232,604	7/1/2017
Subtotal:	6.8%	$ 7,927,503	$ 8,272,504

Wireless
Azumio, Inc.		$ 570,259	$ 760,259	*



Clementine Labs, Inc.		213,102	213,102	3/1/2017
GPShopper, LLC		601,616	601,616	7/1/2017
InfoReach, Inc.		391,765	391,765	3/1/2017
Meru Networks, Inc.		1,777,937	1,777,937	8/1/2015
Receivd, Inc.		154,959	382,959	*
SpiderCloud Wireless, Inc.		4,643,666	4,643,666	7/1/2017
Subtotal:	7.2%	$ 8,353,304	$ 8,771,304

Total (Cost of $200,167,406):	157.9%	183,481,397	200,167,406

*As of March 31, 2015, loans with a cost basis of $21.2 million and a fair value of $7.4 million were classified as non-accrual. These loans have been accelerated from their original maturity and are due in their entirety. During the period for which these loans have been on non-accrual status, no interest income has been recognized.

All loans as of December 31, 2014 were to non-affiliates and consisted of the following:



		Estimated Fair	Par Value	Final
Borrower		Value 12/31/14	Value 12/31/14	Maturity Date
Carrier Networking
Treq Labs, Inc.		$ 1,823,279	$ 1,823,279	*
Subtotal:	1.3%	$ 1,823,279	$ 1,823,279

Computers & Storage
Clustrix, Inc.		$ 2,134,611	$ 2,134,611	5/1/2017
Connected Data, Inc.		1,881,044	1,881,044	5/1/2017
D-Wave Systems, Inc.		1,598,859	1,598,859	2/1/2017
Gridstore, Inc.		1,413,836	1,413,836	6/1/2017
Veloxum, Inc.		416,093	416,093	*
Vidcie, Inc.		431,642	431,642	12/1/2015
Subtotal:	5.7%	$ 7,876,085	$ 7,876,085

Enterprise Networking
Apprion, Inc.		$ 534,558	$ 534,558	4/1/2016
Splashtop, Inc.		1,127,792	1,127,792	5/1/2016
Subtotal:	1.2%	$ 1,662,350	$ 1,662,350

Internet
Behalf, Inc.		$ 1,488,729	$ 1,488,729	5/1/2017
Better Doctor, Inc.		304,363	304,363	6/1/2016
Change.org, Inc.		1,923,173	1,923,173	11/1/2016
CloudTalk, Inc.		5,000	124,008	*
CustomMade, Inc.		1,713,379	1,713,379	5/1/2017
DailyFeats, Inc.		210,068	210,068	1/1/2016
Desti, Inc.		38,983	43,283	*
Digital Caddies, Inc.		854,469	854,469	6/1/2017
FanBridge, Inc.		453,896	643,896	*
FanDuel, Inc.		1,400,975	1,400,975	9/1/2016
Fast Labs, Inc.		373,488	373,488	3/1/2017



Fingi, Inc.	275,000	352,718	6/1/2018
FlipTop, Inc.	379,583	379,583	6/1/2017
Giddy Apps, Inc.	938,861	938,861	12/1/2017
Giga Omni Media, Inc.	2,498,405	2,498,405	2/1/2016
Giveforward, Inc.	474,588	474,588	7/1/2017
Good Eggs, Inc.	303,029	303,029	6/1/2016
Grovo Learning, Inc.	876,425	876,425	3/1/2017
HEXAGRAM 49, Inc.	421,188	421,188	1/1/2016
Inside Vault, Inc.	437,370	437,370	5/1/2017
Jun Group, LLC	710,184	710,184	2/1/2017
KargoCard, Co.	473,843	473,843	1/1/2016
Kitsy Lane, Inc.	193,730	193,730	12/1/2016
Kiwi Crate, Inc.	1,042,522	1,042,522	7/1/2017
Komli Media, Inc.	2,981,677	2,981,677	11/1/2015
Kulbyt, Inc.	109,363	109,363	8/1/2015
Lenddo International, Inc.	1,045,505	1,045,505	12/1/2015
Lightside Games, Inc.	162,230	235,230	*
LocalResponse, Inc.	341,958	341,958	3/1/2016
MassDrop, Inc.	358,248	358,248	9/1/2017
MediaSpike, Inc.	207,440	207,440	12/1/2016
MeetMe, Inc.	1,322,995	1,322,995	4/1/2016
Minno, Inc.	1,588,734	1,588,734	3/1/2018
Moda Operandi, Inc.	125,127	125,127	12/1/2015
Modasuite, Inc.	1,256,711	1,256,711	7/1/2016
Monetate, Inc.	3,736,811	3,736,811	6/1/2018
Moveline, Inc.	0	929,799	*
Navigating Cancer, Inc.	934,389	934,389	7/1/2016
Osix Corp.	302,026	302,026	10/1/2016
PerformLine, Inc.	68,562	68,562	5/1/2015
Piryx, Inc.	1,511,061	1,511,061	6/1/2017
Pixalate, Inc.	407,620	407,620	3/1/2017
Playstudios, Inc.	3,400,117	3,400,117	6/1/2018
Pleying, Inc.	184,031	184,031	12/1/2016
Quantcast Corp.	7,331,527	7,331,527	4/1/2017
Quri, Inc.	1,906,998	1,906,998	6/1/2018
Radius Intelligence, Inc.	1,608,479	1,608,479	10/1/2017
Relay Network, LLC	435,496	435,496	7/1/2015
Retail Innovation Group, Inc.	1,611,875	1,611,875	7/1/2016
Rivet Games, Inc.	123,082	190,082	*
The SavvySource For Parents, Inc.	396,598	396,598	12/1/2016
Schooltube, Inc.	68,222	108,222	*
ServiceMarketplace, Inc.	215,178	215,178	7/1/2017
Session M, Inc.	1,557,014	1,557,014	2/1/2017
Smart Lunches, Inc.	155,505	155,505	6/1/2016
Sociable Labs, Inc.	313,361	313,361	7/1/2016
TangoCard, Inc.	47,019	47,019	3/1/2015



The Black Tux, Inc.		722,390	722,390	2/1/2018
The Lucky Group Inc.		4,845,416	5,345,416	8/1/2018
UserVoice, Inc.		317,346	317,346	11/1/2015
Waluzi, Inc.		79,987	79,987	8/1/2016
Weddington Way, Inc.		815,644	815,644	11/1/2016
WHI, Inc.		1,877,385	1,877,385	7/1/2017
YouDocs Beauty, Inc.		961,655	1,161,655	5/1/2018
Subtotal:	46.1%	$ 63,226,033	$ 65,426,858

Medical Devices
AxioMed, Inc.		$ 23,748	$ 1,569,748	*
Blockade Medical, LLC		463,868	463,868	9/1/2017
Cayenne Medical, Inc.		4,765,638	4,765,638	12/1/2017
Cervilenz, Inc.		1,823,990	1,823,990	4/1/2016
HourGlass Technologies, Inc.		243,351	869,351	*
MimOSA, Inc.		194,284	194,284	12/1/2015
NasoForm, Inc.		30,077	30,077	2/1/2015
Redox Medical, Inc.		500,000	3,600,000
Sonoma Orthopedic Products, Inc.		2,362,253	2,362,253	4/1/2016
Subtotal:	7.6%	$ 10,407,209	$ 15,679,209

Other Healthcare
Cogito Health, Inc.		$ 512,736	$ 512,736	4/1/2017
Health Integrated, Inc.		2,089,102	2,089,102	10/1/2017
HealthEquityLabs, Inc.		927,690	927,690	6/1/2018
Mulberry Health, Inc.		4,812,610	4,812,610	12/1/2017
Physician Software Systems, LLC		476,037	476,037	7/1/2017
Practice Fusion, Inc.		4,443,620	4,443,620	6/1/2016
Project Healthy Living, Inc.		892,851	892,851	10/1/2016
Therapydia, Inc.		602,420	602,420	10/1/2017
Urgent Care Centers of New England, Inc.		2,349,955	2,349,955	4/1/2018
ZocDoc, Inc.		4,517,666	4,517,666	6/1/2017
Subtotal:	15.8%	$ 21,624,687	$ 21,624,687

Other Technology
21e6, LLC		$ 12,754,495	$ 12,754,495	8/1/2017
Automatic Labs, Inc.		766,320	766,320	12/1/2016
Beeline Bikes, Inc.		135,592	135,592	6/1/2017
Daylight Solutions, Inc.		2,571,168	2,571,168	8/1/2017
Ecologic Brands, Inc.		635,944	635,944	6/1/2017
General Assembly, Inc.		1,956,427	1,956,427	12/1/2016
InsideTrack, Inc.		1,304,318	1,304,318	9/1/2017
LanzaTech New Zealand, Ltd.		8,090,966	8,090,966	7/1/2016
Lumo BodyTech, Inc.		1,179,641	1,179,641	12/1/2017
Neuehouse, LLC		3,997,428	3,997,428	7/1/2017
nWay, Inc.		1,361,505	1,361,505	3/1/2018
Pinnacle Engines, Inc.		1,583,540	1,583,540	12/1/2017



PLAE, Inc.		462,689	462,689	6/1/2017
Prana Holdings, Inc.		4,514,012	4,514,012	7/1/2016
Scoot Networks, Inc.		414,974	414,974	3/1/2017
Skully Helmets, Inc.		227,456	227,456	7/1/2017
Sproutling, Inc.		709,251	709,251	9/1/2017
Thoughtful Media Group, Inc.		393,020	573,020	*
Tribogenics, Inc.		1,186,455	1,186,455	9/1/2016
YPX Cayman Holdings Co.		1,003,708	1,003,708	4/1/2016
ZeaChem, Inc.		374,248	4,076,248	*
Subtotal:	33.3%	$ 45,623,157	$ 49,505,157

Security
Agari Data, Inc.		$ 1,082,097	$ 1,082,097	9/1/2017
Guardian Analytics, Inc.		2,856,906	2,856,906	1/1/2018
Kinamik, Inc.		633,670	643,670	*
Uplogix, Inc.		1,250,804	1,250,804	5/1/2017
Venafi, Inc.		3,709,903	3,709,903	6/1/2017
Voltage Security, Inc.		2,369,626	2,369,626	9/1/2017
Subtotal:	8.7%	$ 11,903,006	$ 11,913,006

Software
3Scale, Inc.		$ 712,931	$ 712,931	9/1/2017
AcousticEye, Ltd.		153,386	153,386	12/1/2015
Appconomy, Inc.		1,024,362	2,037,362	*
Apportable, Inc.		835,072	835,072	3/1/2017
Artificial Solutions ASH AB		123,155	123,155	2/1/2015
Atigeo, LLC		2,784,801	2,784,801	9/1/2017
Beanstock Media, Inc.		1,336,495	1,336,495	12/1/2018
BlazeMeter, Inc.		699,151	699,151	10/1/2017
Brightpearl, Inc.		457,337	457,337	6/1/2016
ClearPath, Inc.		275,217	275,217	5/1/2016
Clypd, Inc.		571,745	571,745	11/1/2016
Corduro, Inc.		42,212	132,212	*
D Software, Inc.		156,130	156,130	6/1/2016
Dataium, LLC		162,472	354,472	7/1/2016
DropThought, Inc.		477,668	477,668	12/1/2016
eCommera, Inc.		3,885,784	3,885,784	3/1/2017
Encoding.com, Inc.		524,900	524,900	11/1/2016
gloStream, Inc.		939,981	1,239,981	*
Innerworkings Holdings, Ltd.		14,249	341,471	*
Intalio, Inc.		286,710	286,710	8/1/2015
MediaPlatform, Inc.		563,199	563,199	9/1/2016
Mintigo, Inc.		1,427,018	1,427,018	1/1/2018
Nectar Holdings, Inc.		1,171,556	1,171,556	12/1/2017
OrderGroove, Inc.		878,707	878,707	12/1/2016
Palantir Technologies, Inc.		6,892,406	6,892,406	4/1/2016
Pursway, Inc.		1,078,449	1,078,449	7/1/2016



Riskonnect, Inc.		184,191	184,191	8/1/2015
SCVNGR, Inc.		1,821,982	1,821,982	10/1/2016
SnapLogic, Inc.		1,648,742	1,648,742	7/1/2016
SoundHound, Inc.		3,640,099	3,640,099	5/1/2017
STG-Impact Holdings Corp.		5,677,173	5,677,173	3/1/2016
StreetLight Data, Inc.		635,179	635,179	4/1/2017
Superfish, Inc.		376,601	376,601	10/1/2015
Top Hat Monocle Corp.		640,324	640,324	7/1/2016
Vuemix, Inc.		44,466	44,466	8/1/2015
Workspot, Inc.		164,807	164,807	9/1/2016
Xceedium, Inc.		147,224	147,224	4/1/2015
ZeroTurnaround USA, Inc.		1,428,219	1,428,219	6/1/2018
Subtotal:	32.0%	$ 43,884,100	$ 45,806,322

Technology Services
Akademos, Inc.		$ 890,914	$ 890,914	6/1/2017
Amped, Inc		1,431,563	1,431,563	11/1/2017
BidPal, Inc.		623,702	623,702	4/1/2016
Blazent, Inc.		583,639	583,639	5/1/2016
Blue Technologies, Ltd.		700,984	700,984	6/1/2017
BountyJobs, Inc.		909,044	909,044	10/1/2017
Callisto Media, Inc.		576,716	576,716	9/1/2016
FSA Store, Inc.		1,220,757	1,220,757	9/1/2017
Grassroots Unwired, Inc.		73,323	73,323	8/1/2016
Maxi Mobility, Inc.		154,981	154,981	7/1/2016
Rated People, Ltd.		1,913,091	1,913,091	12/1/2016
Stackstorm, Inc.		267,700	267,700	8/1/2017
TiqIQ, Inc.		244,011	244,011	7/1/2017
Subtotal:	7.0%	$ 9,590,425	$ 9,590,425

Wireless
Appstack, Inc.		0	295,965
Azumio, Inc.		675,052	675,052	11/1/2015
Clementine Labs, Inc.		235,375	235,375	3/1/2017
Flint Mobile, Inc.		571,293	571,293	1/1/2016
GPShopper, LLC		685,378	685,378	7/1/2017
InfoReach, Inc.		431,000	431,000	3/1/2017
Meru Networks, Inc.		2,791,500	2,791,500	8/1/2015
Receivd, Inc.		40,459	420,459	*
SpiderCloud Wireless, Inc.		4,695,305	4,695,305	7/1/2017
Subtotal:	7.4%	$ 10,125,362	$ 10,801,327

Total (Cost of $239,908,705):	166.2%	$ 227,745,693	$ 241,708,705

*As of December 31, 2014, loans with a cost basis of $18.5 million and a fair value of $7.3 million were classified as non-accrual. These loans have been accelerated from their original maturity and are due in their entirety. During the period for which these loans have been on non-accrual status, no interest income has been recognized.

The Fund provides asset-based financing primarily to start-up and emerging growth venture-capital-backed companies. These loans are generally secured by assets of the borrowers. As a result, the Fund is subject to general credit risk associated with such companies. As of March 31, 2015 and December 31, 2014, the Fund had unexpired unfunded commitments to borrowers of $15.8 million and $21.2 million, respectively.

Valuation Hierarchy

Under FASB Accounting Standards Codification (ASC) 820-10, the Fund categorizes its fair value measurements according to a three-level hierarchy. The hierarchy prioritizes the inputs used by the Fund's valuation techniques. A level is assigned to each fair value measurement based on the lowest level input that is significant to the fair value measurement in its entirety. The three levels of the fair value hierarchy are defined as follows:



Level 1		Unadjusted quoted prices for identical assets or liabilities in active markets that are accessible at the measurement date.
Level 2		Prices or valuations based on observable inputs other than quoted prices in active markets for identical assets and liabilities.
Level 3		Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

Transfer of investments between levels of the fair value hierarchy is recorded on the actual date of the event or

change in circumstances that caused the transfer. There were no transfers in and out of Level 1, 2, and 3 during the

period ended March 31, 2015.

The Fund's cash equivalents were valued at the traded net asset value of the money market mutual fund. As a result, these measurements are classified as Level 1. The Fund's investments in the interest rate swaps are based on quotes from the market makers and therefore, are classified as Level 2. The Fund uses estimated exit values when determining the value of its investments. Because loan transactions are individually negotiated and unique, and there is no market in which these assets trade, the inputs for these assets, which are discussed in the Valuation Methods listed above, are classified as Level 3.

The following tables provide quantitative information about the Fund's Level 3 fair value measurements of its investments as of March 31, 2015 and December 31, 2014. In addition to the techniques and inputs noted in the tables below, the Fund may also use other valuation techniques and methodologies when determining its fair value measurements. The below tables are not intended to be all-inclusive, but rather to provide information on significant Level 3 inputs as they relate to the Fund's fair value measurements.



Investment Type
- Level 3	Fair Value at	Valuation Techniques/		Weighted Average/
Debt Investments	3/31/2015	Methodologies	Unobservable Input	Range
Computer & Storage	$7,111,627	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	19%
		Liquidation	Investment Collateral	$416,093

Enterprise Networking	$1,396,575	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	17%

Internet	49,953,023	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	15%
		Liquidation	Investment Collateral	$0- $1,238,817

Medical Devices	$5,886,612	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	15%
		Liquidation	Investment Collateral	$14,238-$500,000

Other Healthcare	$15,718,501	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	14%

Other Technology	$39,917,867	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	15%
		Liquidation	Investment Collateral	$110,960-$165,808

Security	$8,485,094	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	16%

Software	$38,731,291	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	16%
		Liquidation	Investment Collateral	$4,845-$901,560

Technology Services	$7,927,503	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	17%
		Liquidation	Investment Collateral	$1,124,901

Wireless	$8,353,304	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	16%
		Liquidation	Investment Collateral	$154,959-$570,259

Total	183,481,397



Investment Type
- Level 3	Fair Value at	Valuation Techniques/		Weighted Average/
Debt Investments	12/31/2014	Methodologies	Unobservable Input	Range
Carrier Networking	$1,823,279	Liquidation	Investment Collateral	$1,823,279

Computer & Storage	$7,876,085	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	19%
		Liquidation	Investment Collateral	$416,093

Enterprise Networking	$1,662,350	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	17%

Internet	$63,226,033	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	16%
		Liquidation	Investment Collateral	$0- $453,896

Medical Devices	$10,407,209	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	15%
		Liquidation	Investment Collateral	$23,748-$500,000

Other Healthcare	$21,624,687	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	15%

Other Technology	$45,623,157	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	15%
		Liquidation	Investment Collateral	$374,248-$393,020

Security	$11,903,006	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	16%
		Liquidation	Investment Collateral	$633,670

Software	$43,884,100	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	16%
		Liquidation	Investment Collateral	$14,249-$1,024,362

Technology Services	$9,590,425	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	16%

Wireless	$10,125,362	Hypothetical Market Analysis	Hypothetical Market Coupon Rate	16%
		Liquidation	Investment Collateral	$0-$40,459

Total	$ 227,745,693

The following table presents the balances of assets and liabilities as of March 31, 2015 and December 31, 2014 measured at fair value on a recurring basis:



As of March 31, 2015	Level 1		Level 2		Level 3		Total
ASSETS:
Loans*			$	—	$	183,481,397	$	183,481,397
Other Investment	—		73,461		—		73,461
Cash equivalents	19,032,323		—		—		19,032,323
Total	$	19,032,323	$	73,461	$	183,481,397	$	202,587,181



As of December 31, 2014	Level 1		Level 2		Level 3		Total
ASSETS:
Loans*	$	—	$	—	$	227,745,693	$	227,745,693
Other Investment	—		149,844		—		149,844
Cash equivalents	14,006,961		—		—		14,006,961
Total	$	14,006,961	$	149,844	$	227,745,693	$	241,902,498

*For a detailed listing of borrowers comprising this amount please refer to Note 3, Summary of Investments.

The following table provides a summary of changes in Level 3 assets measured at fair value on a recurring basis:



	For the Three Months Ended March 31, 2015
	Loans			Warrants			Stock			Convertible Note
Beginning balance	$	227,745,693		$	—		$	—		$	—
Acquisitions and originations	2,112,500			416,950			642,227			250,000
Principal reductions	(40,835,768		)	—			—			—
Distribution to shareholder				(416,950		)	(642,227		)	(250,000		)
Net change in unrealized gain (loss) from investments	(4,522,997		)	—			—			—
Net realized loss from investments	(1,018,031		)	—			—			—
Ending balance	$	183,481,397		$	—		$	—		$	—
Net change in unrealized loss on investments relating to investments still held at March 31, 2015	$	(6,028,478	)



	For the Three Months Ended March 31, 2014
	Loans			Warrants			Convertible Note
Beginning balance	$	293,800,885		$	—		$	—
Acquisitions and originations	31,830,000			3,309,433			37,154
Principal reductions	(45,705,924		)	—			—
Distribution to shareholder	—			(3,309,433		)	(37,154		)
Net change in unrealized loss from investments	1,186,141			—			—
Net realized loss from investments	(1,309,141		)	—			—
Ending balance	$	279,801,961		$	—		$	—
Net change in unrealized loss on investments relating to investments still held at March 31, 2014	$	(309,449	)


4.	EARNINGS PER SHARE

Basic earnings per share are computed by dividing net increase in net assets resulting from operations by the weighted average common shares outstanding. Diluted earnings per share are computed by dividing net increase in net assets resulting from operations by the weighted average common shares outstanding, including the dilutive effects of potential common shares (e.g., stock options). The Fund held no instruments that would be potential common shares; thus, reported basic and diluted earnings per share are the same.


5.	CAPITAL STOCK

As of March 31, 2015 and December 31, 2014, there were 10,000,000 shares of $0.001 par value common stock authorized, and 100,000 shares issued and outstanding. Total committed capital of the Company, as of March 31, 2015, was $294.0 million. Total contributed capital to the Company through March 31, 2015 and December 31, 2014 was $279.3 million, of which $241.5 million was contributed to the Fund.

The chart below shows the distributions of the Fund for the three months ended March 31, 2015 and 2013.



	For the Three Months Ended March 31, 2015		For the Three Months Ended March 31, 2014
Cash distributions	$	22,000,000	$	16,800,000
Distributions of equity securities	1,309,177		3,346,587

Total distributions to shareholder	$	23,309,177	$	20,146,587

Final classification of the distributions as either a return of capital or a distribution of income is an annual determination made at the end of each year dependent upon the Fund's current year and cumulative earnings and profits.

6. DEBT FACILITY

The Fund established a secured revolving loan facility in an amount of up to $160 million with Union Bank, N.A., Wells Fargo Bank, N.A. and Bank Leumi USA on September 23, 2011 (the "Loan Agreement").

The Loan Agreement was extended on September 23, 2014 and then amended and restated in its entirely on September 30, 2014, reducing the size to $120 million, and securing an initial 12-month repayment plan and a subsequent 18-month amortized repayment plan. Amounts borrowed under the Loan Agreement may be, at the option of the Fund, either Reference Rate loans (as defined in the Loan Agreement) or LIBOR loans. As of March 31, 2015, $87.7 million was outstanding under the Loan Agreement. The Loan Agreement will terminate on March 23, 2017, but can be accelerated under an event of default such as failure by the Fund to make timely interest or principal payments.

Borrowings under the Loan Agreement are collateralized by receivables under loans advanced by the Fund with assignment to the financial institution, plus other assets of the Fund. The Fund pays a commitment fee of 0.325 percent (annual fee paid quarterly) based on the total unused portion of the facility. The Fund pays interest on its borrowings. The facility revolves for 12 months, at which time the Loan Agreement size begins to reduce.

Bank fees of $280,000 were incurred in connection with the renewal of the facility on September 30, 2014. The bank fees and other costs incurred will be capitalized and amortized to interest expense on a straight line basis over the expected life of the facility. Fees and costs previously incurred under the facility have been fully amortized.

The facility contains various covenants including financial covenants related to: (i) debt to net worth ratio, (ii) minimum debt service coverage ratio, (iii) interest coverage ratio, (iv) asset coverage, (v) asset coverage under investment company act, (vi) maximum loan loss reserves, and (vii) unfunded commitment ratio. There are also various restrictive covenants, including limitations on (i) the incurrence of liens, (ii) consolidations, mergers and asset sales, and (iii) capital expenditures. As of March 31, 2015, Management believes that the Fund was in compliance with these covenants.

The following is the summary of the outstanding facility draws as of March 31, 2015:



Roll-Over Date	Amount			Maturity Date	Floating Interest Rate
March 13, 2015	$	16,000,000	(*)	4/13/2015	2.93%
March 13, 2015	$	71,700,000		6/15/2015	3.02%
TOTAL OUTSTANDING	$	87,700,000

(*) $7.7 million was paid on 4/10/2015 and $8.3 million loan was subsequently rolled for a 60-day LIBOR loan, maturing on June 12, 2015.

7. INTEREST RATE CAP AGREEMENT

As of March 31, 2015, the Fund has entered into interest rate cap transactions with MUFG Union Bank, N.A. and Wells Fargo Bank, N.A. with a notional principal amount of $63 million for both agreements, to cap floating interest rates at 0.7%. The purpose of the interest rate cap agreement is to protect the Fund against rising interest rates, as the Fund originates loans with fixed interest rates. The Fund continues to adjust the notional principal amount as the outstanding balance under the debt facility changes. The Fund paid upfront fees of $0.2 million which are amortized on a straight line basis over the life of the instrument and receives from the counterparty a payment of interest amounts above the 0.7% cap based on 30-day LIBOR. Payments, if necessary are made monthly and will terminate on March 23, 2017.

As of March 31, 2015 and December 31, 2014, the fair value of the Fund's derivative financial instruments was as follows:

Asset Derivatives

March 31, 2015

December 31, 2014

Derivatives Not Designated as Hedging Instruments:

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Interest rate cap agreement

Other Investment

73,461

Other Investment

149,844

For the three months ended March 31, 2015 , the derivative financial instruments had the following effect on the Condensed Statements of Operations:



Derivatives Not Designated as Hedging Instruments:	Location of Loss Recognized		For the Three Months Ended March 31, 2015
Interest rate cap agreement	Net change in unrealized gain (loss) from hedging activities	$	(53,383)

8. FINANCIAL HIGHLIGHTS

GAAP requires disclosure of financial highlights of the Fund for the periods presented, the three months ended March 31, 2015. The total rate of return is defined as the return based on the change in value during the period of a theoretical investment made at the beginning of the period. The total rate of return assumes a constant rate of return for the Fund during the period reported and weights each cash flow by the amount of time held in the Fund. This required methodology differs from an internal rate of return.

The ratios of expenses and net investment income to average net assets, calculated below, are annualized and are computed based upon the aggregate weighted average net assets of the Fund for the periods presented. Net investment income is inclusive of all investment income net of expenses, and excludes realized or unrealized gains and losses.

Beginning and ending net asset values per share are based on the beginning and ending number of shares outstanding.

Other per share information is calculated based upon the aggregate weighted average net assets of the Fund for the periods presented.

The following per share data and ratios have been derived from the information provided in the financial statements:



	For the Three Months Ended March 31, 2015			For the Three Months Ended March 31, 2014

Total return **	1.98		%	5.93		%

Per share amounts:
Net asset value, beginning of period	$	1,370.15		$	1,943.66
Net investment income	81.12			108.42
Net realized and change in unrealized
(loss) from investments and
hedging activities	(55.94		)	(1.66		)
Net increase in net assets from operations	25.18			106.76
Distributions of income to shareholder	(70.94		)	(92.33		)
Return of capital to shareholder	(162.15		)	(109.14		)

Net asset value, end of period	$	1,162.24		$	1,848.95

Net assets, end of period	$	116,223,838		$	184,895,482

Ratios to average net assets:

Expenses*	6.95		%	7.11		%
Net investment income*	25.19		%	23.90		%
* Annualized
** Total return amounts presented above are not annualized.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

In addition to the historical information contained herein, the information in this Quarterly Report on Form 10-Q contains certain “forward-looking statements” within the meaning of the securities laws. These forward-looking statements reflect the current view of Venture Lending & Leasing VI, Inc. (the “Fund”) with respect to future events and financial performance and are subject to a number of risks and uncertainties, many of which are beyond the Fund's control. All statements, other than statements of historical facts included in this report, regarding the strategy, future operations, financial position, estimated revenues, projected costs, prospects, plans and objectives of the Fund are forward-looking statements. When used in this report, the words “will”, “believe”, “anticipate”, “intend”, “estimate”, “expect”, “project” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. All forward-looking statements speak only as of the date of this report. The reader of this Quarterly Report should understand that all such forward-looking statements are subject to various uncertainties and risks that could affect their outcome. The Fund's actual results could differ materially from those suggested by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, variances in the actual versus projected growth in assets, return on assets, loan losses, expenses, rates charged on loans and earned on securities investments and competition. This entire Quarterly Report should be read to put such forward-looking statements in context and to gain a more complete understanding of the uncertainties and risks involved in the Fund's business. The Fund does not undertake any obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

The Fund is 100% owned by Venture Lending & Leasing VI, LLC (the “Company”). The Fund's shares of Common Stock, at $0.001 par value, were sold to its shareholder, the Company, under a stock purchase agreement. The Fund has issued 100,000 of the Fund's 10,000,000 authorized shares. The Company may make additional capital contributions to the Fund.

The Fund is a financial services company primarily providing financing and advisory services to a variety of carefully selected venture-backed companies primarily located throughout the United States with a focus on growth-oriented companies. The Fund's portfolio is well diversified and consists of companies in the communications, information services, media, and technology, including software and technology-enabled business services, bio-technology, and medical devices industry sectors, among others. The Fund's capital is generally used by our portfolio companies to finance acquisitions of fixed assets and/or for working capital. On June 29, 2010, the Fund completed its first closing of capital contributions, made its first investments, and became a non-diversified, closed-end investment company that elected to be treated as a business development company under the Investment Company Act of 1940. The Fund elected to be treated for federal income tax purposes as a Regulated Investment Company ("RIC") under the Internal Revenue Code with the filing of its federal corporate income tax return for 2010. Pursuant to this election, the Fund generally will not have to pay corporate-level taxes on any income it distributes to the Company as dividends, allowing the Company to substantially reduce or eliminate its corporate-level tax liability.

The Fund will seek to meet the ongoing requirements, including the diversification requirements, to qualify as a RIC under the Internal Revenue Code. If the Fund fails to meet these requirements, it would be taxed as an ordinary corporation on its taxable income for that year (even if that income were distributed to the Company) and all distributions out of its earnings and profits would be taxable to the Members of the Company as ordinary income; thus, such income would be subject to a double layer of tax. There is no assurance that the Fund will meet the ongoing requirements to qualify as a RIC for tax purposes.

The Fund's investment objective is to achieve superior risk adjusted investment returns. The Fund seeks to achieve its investment objective by providing debt financing to portfolio companies. Since inception, the Fund's investing activities have focused primarily on private debt securities. The Fund generally receives warrants to acquire equity securities in connection with its portfolio investments. The Fund distributes these warrants to its

shareholder upon receipt. The Fund also has guidelines for the percentages of total assets which will be invested in different types of assets.

The portfolio investments of the Fund primarily consist of debt financing to venture capital backed companies. The borrower's ability to repay its loans may be adversely impacted by a number of factors, and as a result, the loan may not fully be repaid. Furthermore, the Fund's security interest in any collateral over the borrower's assets may be insufficient to make up any shortfall in payments.

Transactions with Venture Lending & Leasing V, Inc. (“Fund V”)

The Manager also served as investment manager for Fund V, which was dissolved on August 6, 2014 and no longer funded any commitments. However, prior to the dissolution of Fund V, the Fund's Board of Directors determined that so long as Fund V has capital available to invest in loan transactions with final maturities earlier than December 31, 2015 (the date on which Fund V was planned to be dissolved), the Fund will invest in each portfolio company in which Fund V invests (“Investments”). Initially the amount of each Investment was allocated 50% to the Fund and 50% to Fund V so long as Fund V had capital available to invest. After February 2011, Fund V was no longer permitted to enter into new commitments to borrowers, after June 2014, the Fund was no longer permitted to enter into new commitments to borrowers; however, both the Fund and Fund V are permitted to fund existing commitments. While investing the Fund's capital in the same companies in which Fund V is also investing could provide the Fund with greater diversification and access to larger transactions, it could also result in a slower pace of investment than would be the case if the Fund were investing in companies by itself.

Transactions with Venture Lending & Leasing VII, Inc. (“Fund VII”)

The Manager also serves as investment manager for Fund VII. The Fund's Board of Directors determined that so long as the Fund has capital available to invest in loan transactions with final maturities earlier than December 31, 2020 (the date on which the Fund will be dissolved), the Fund had invested in each portfolio company in which Fund VII invested (“Investments”). Initially the amount of each Investment had been allocated 50% to the Fund and 50% to Fund VII so long as the Fund has capital available to invest. After June 2014, the Fund was no longer permitted to enter into new commitments to borrowers; however, the Fund will be permitted to fund existing commitments. While investing the Fund's capital in the same companies in which Fund VII is also investing could provide the Fund with greater diversification and access to larger transactions, it could also result in a slower pace of investment than would be the case if the Fund were investing in companies by itself.

Critical Accounting Policies

The Manager has identified the most critical accounting estimates upon which the financial statements depend and determined the critical accounting estimates by considering accounting policies that involve the most complex or subjective decisions or assessments. The two critical accounting policies relate to the valuation of loans and treatment of non-accrual loans.

Loans are held at fair value as determined by Management, in accordance with the valuation methods described in the valuation of loans section of Note 2 in the Fund's financial statements (Summary of Significant Accounting Policies). Critical factors in determining the fair value of a loan include payment history, collateral position, financial strength of the borrower, prospects for the borrower raising future equity rounds, likelihood of sale or acquisition of the borrower, and length of expected holding period of the loan, as well as an evaluation of the general interest rate environment. The actual value of the loans may differ from Management's estimates, which would affect net income as well as assets.

Results of Operations - For the Three Months Ended March 31, 2015 and 2014

Total investment income for the three months ended March 31, 2015 and 2014 was $10.3 million and $14.1 million, respectively, which primarily consisted of interest on the venture loans outstanding. The remaining income

consisted of interest and dividends on the temporary investment of cash, forfeited commitment fees, and fees earned from waivers to loan agreements. The decrease in investment income is due to the decrease in the average loans outstanding from $280.8 million for the three months ended March 31, 2014 to $201.0 million for the three months ended March 31, 2015. This decrease is also because of the decrease in average interest rates from 19.02% for the three months ended March 31, 2014 to 18.97% for the three months ended March 31, 2015. Interest is calculated using the effective interest method, and rates earned by the Fund will fluctuate based on many factors including volatility of values ascribed to warrants, and new loans funded during the year and early payoffs.

Management fees for the three months ended March 31, 2015 and 2014 were $1.3 million and $2.0 million, respectively. Management fees are calculated as 2.5 percent of the Fund's total assets. Management fees decreased because assets under management as of March 31, 2015 were lower than assets as of March 31, 2014.

Total interest expense was $0.8 million and $1.1 million for the three months ended March 31, 2015 and 2014, respectively. Interest expense slightly decreased primarily due to the decreased average borrowings, which decreased from from $129.2 million for the three months ended March 31, 2014 to $96.9 million for the three months ended March 31, 2015. These decreases in interest expense is also because of the decreased interest rate from 3.41% for the three months ended March 31, 2014 to 3.18% for the three months ended March 31, 2015.

Total banking and professional fees were $0.2 million and $0.1 million for the three months ended March 31, 2015 and 2014, respectively. The banking and professional fees were comprised of legal, audit, banking and other professional fees. These fees increased in 2015 primarily because of increased legal fees.

Total other operating expenses were less than $0.1 million for the three months ended March 31, 2015 and 2014.

Net investment income for the three months ended March 31, 2015 and 2014, was $8.1 million and $10.8 million, respectively.

Net realized loss from investments was $1.0 million and $1.3 million for the three months ended March 31, 2015 and 2014, respectively.

Net change in unrealized gain (loss) from investments was $(4.5) million and $1.2 million for the three months ended March 31, 2015 and 2014, respectively. The unrealized loss consists of fair market value adjustments to loans.

Net change in unrealized gain (loss) from hedging activities was less than $0.1 million for the three months ended March 31, 2015 and 2014. The unrealized gain (loss) consists of the unrealized losses from hedging activities. The Fund entered into interest rate swap transactions with Union Bank, N.A and Wells Fargo Bank, N.A. to convert floating rate liabilities to fixed rates, which terminated on September 23, 2014. On September 30, 2014, the Fund entered into interest rate cap transactions with Union Bank, N.A and Wells Fargo Bank, N.A. to cap the floating rate liabilities at a fixed rate (see Note 7 in the Fund's financial statements).

Net increase in net assets resulting from operations for the three months ended March 31, 2015 and 2014 was $2.5 million and $10.7 million, respectively. On a per share basis, the net increase in net assets resulting from operations was $25.18 and $106.76 for the three months ended March 31, 2015 and 2014, respectively.

Liquidity and Capital Resources – March 31, 2015 and December 31, 2014

Total capital contributed to the Fund was $241.5 million, prior to distribution of capital, as of March 31, 2015. Committed capital to the Company at March 31, 2015 was $294.0 million, of which $279.3 million had been called. The remaining $14.7 million in committed capital as of March 31, 2015 is due to expire in June 2015 as the five year anniversary will have passed, at which time no further capital can be called.

The Fund established a secured revolving debt facility in an amount of up to $160 million with Union Bank, N.A., Wells Fargo Bank, N.A. and Bank Leumi USA. The facility was extended through March 23, 2017 and the amount available was reduced to $120 million. The size of the facility was reduced to $94 million on February 18, 2015, and to $84 million on April 15, 2015. The Fund will continue to reduce the facility because of its sufficient cash and cash flow to meet the needs of the unfunded commitments as well as pay expenses without further need to borrow. As of March 31, 2015 and December 31, 2014, the outstanding balance under the facility was $87.7 million and $106.6 million, respectively. Subsequent to the quarter-end, the Fund paid $7.7 million on April 10, 2015 and the outstanding balance under the facility was reduced to $80.0 million.

As of March 31, 2015 and December 31, 2014, 9% and 6%, respectively, of the Fund's assets consisted of cash and cash equivalents. The Fund invested its assets in venture loans during the three months ended March 31, 2015. Amounts disbursed under the Fund's loan commitments totaled approximately $2.1 million during the three months ended March 31, 2015. Net loan amounts outstanding after amortization and fair market adjustment decreased by approximately $44.2 million for the same period. Unexpired, unfunded commitments totaled approximately $15.8 million as of March 31, 2015.




As of	Cumulative Amount Disbursed	Principal Reductions and Fair Market Adjustments	Balance Outstanding - Fair Value	Unexpired Unfunded Commitments
March 31, 2015	$714.1 million	$530.6 million	$183.5 million	$15.8 million
December 31, 2014	$712.0 million	$484.3 million	$227.7 million	$21.2 million

Because venture loans are privately negotiated transactions, investments in these assets are relatively illiquid. It is the Fund's experience that not all unfunded commitments will be used by borrowers.

The Fund seeks to meet the requirements to qualify for the special pass-through status available to RICs under the Internal Revenue Code, and thus to be relieved of federal income tax on that part of its net investment income and realized capital gains that it distributes to the Company. To qualify as a RIC, the Fund must distribute to the Company for each taxable year at least 90% of its investment company taxable income (consisting generally of net investment income and net short-term capital gain) (“Distribution Requirement”). To the extent that the terms of the Fund's venture loans provide for the receipt by the Fund of additional interest at the end of the loan term or provide for the receipt by the Fund of a purchase price for the asset at the end of the loan term (“residual income”), the Fund would be required to accrue such residual income over the life of the loan, and to include such accrued income in its gross income for each taxable year even if it receives no portion of such residual income in that year. Thus, in order to meet the Distribution Requirement and avoid payment of income taxes or an excise tax on undistributed income, the Fund may be required in a particular year to distribute as a dividend an amount in excess of the total amount of income it actually receives. Those distributions will be made from the Fund's cash assets, from amounts received through amortization of loans or from borrowed funds.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Fund's business activities contain elements of risk. The Fund considers the principal types of market risk to be interest rate risk and credit risk. The Fund considers the management of risk essential to conducting its business and to maintaining profitability. Accordingly, the Fund's risk management procedures are designed to identify and analyze the Fund's risks, to set appropriate policies and limits and to continually monitor these risks and limits by means of reliable administrative and information systems and other policies and programs.

The Fund manages its market risk by maintaining a portfolio that is diverse by industry, size of investment, stage of development, and borrower. The Fund has limited exposure to public market price fluctuations as the Fund primarily invests in private business enterprises and the Fund distributes all equity investments upon receipt to the Company.

The Fund's investments are subject to market risk based on several factors, including, but not limited to, the

borrower's credit history, available cash, support of the borrower's underlying investors, available liquidity, "burn

rate", revenue income, security interest, secondary markets for collateral, the size of the loan, and term of the loan.

The Fund's sensitivity to changes in interest rates is regularly monitored and analyzed by measuring the

characteristics of assets and liabilities. The Fund utilizes various methods to assess interest rate risk in terms of the

potential effect on interest income net of interest expense, the value of net assets and the value at risk in an effort to

ensure that the Fund is insulated from any significant adverse effects from changes in interest rates. At March 31, 2015, the outstanding debt balance was $87.7 million with interest based on a weighted averaged interest rate of 0.25%, for which the Fund had an interest rate cap in place at 0.70% on $63.0 million of outstanding debt, leaving the Fund's maximum exposure to interest rate sensitivity at 0.45%, which the Manager does not believe is material to the financial statements. Additionally, the Fund has interest rate risk on the $24.7 million uncapped portion of the debt facility.

Although the Manager believes that this measure is indicative of the Fund's sensitivity to interest rate changes, it makes estimates to adjust for potential changes in credit quality, size and composition of the balance sheet and other business developments that could affect net income. Accordingly, no assurances can be given that actual results would not differ materially from the potential outcome simulated by these estimates.

Item 4. Controls and Procedures:

Evaluation of Disclosure Controls and Procedures:

As of the end of the period covered by this quarterly report on Form 10-Q, the Fund's chief executive officer and chief financial officer conducted an evaluation of the Fund's disclosure controls and procedures (as defined in Rules 13a-15 and 15d-15 of the Securities Exchange Act of 1934). Based upon this evaluation, the Fund's chief executive officer and chief financial officer concluded that the Fund's disclosure controls and procedures were effective in timely alerting them of any material information relating to the Fund that is required to be disclosed by the Fund in the reports it files or submits under the Securities Exchange Act of 1934.

Changes in Internal Controls:

There were no changes in the Fund's internal controls or in other factors that could materially affect these controls during the period covered by this quarterly report on Form 10-Q.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

The Fund may become party to certain lawsuits from time to time in the normal course of business. While the outcome of any legal proceedings cannot at this time be predicted with certainty, the Fund does not expect any such proceedings will have a material effect upon the Fund's financial condition or results of operation. Management is not aware of any pending legal proceedings involving the Fund.

Item 1A. Risk Factors

See item 1A - 'Risk Factors' in the Fund's 2014 Annual Report on Form 10-K for a detailed description of the risks attendant to the Fund and its business. There were no material changes to these factors during the three months ended March 31, 2015.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Prior to the Fund's commencement of operations on June 29, 2010, the Fund sold 100,000 shares to the Fund's sole shareholder, the Company, for $25,000 in January 2010. No other shares of the Fund have been sold; however,

the Fund received an additional $241.5 million of paid in capital during the period from June 29, 2010 through March 31, 2015 which is expected to be used to acquire venture loans and fund operations.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Issues

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits



Exhibit Number	Description
3(i)	Articles of Incorporation of the Fund as filed with the Maryland Secretary of State on January 11, 2010, incorporated by reference to the Fund's Form 10 filed with the Securities and Exchange Commission on February 9, 2010.
3(ii)	Bylaws of the Fund, incorporated by reference to the Fund's Form 10 filed with the Securities and Exchange Commission on February 9, 2010.
4.1	Form of Purchase Agreement between the Fund and the Company, incorporated by reference to the Fund's Registration Statement on Form 10 filed with the Securities and Exchange Commission on February 9, 2010.
31.1-32.2	Certifications pursuant to The Sarbanes-Oxley Act of 2002.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned duly authorized.

VENTURE LENDING & LEASING VI, INC.

(Registrant)



By:	/s/ Maurice C. Werdegar	By:	/s/ Martin D. Eng
Maurice C. Werdegar		Martin D. Eng
President and Chief Executive Officer		Chief Financial Officer
Date:	May 14, 2015	Date:	May 14, 2015

EXHIBIT INDEX



Exhibit Number	Description
31.1-32.2	Certifications pursuant to The Sarbanes-Oxley Act of 2002.

Attached files

Venture Lending & Leasing VI, Inc. Reports

Also read