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EX-31.2 - EXHIBIT 31.2 - PhenixFIN Corpv437056_ex31-2.htm
EX-31.1 - EXHIBIT 31.1 - PhenixFIN Corpv437056_ex31-1.htm
EX-32.1 - EXHIBIT 32.1 - PhenixFIN Corpv437056_ex32-1.htm

 

 

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

 

Form 10-Q

 

 

 

(Mark One)  
   
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the Quarterly Period Ended March 31, 2016

or

 

¨ 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: 1-35040

 

MEDLEY CAPITAL CORPORATION

 

(Exact Name of Registrant as Specified in its Charter)

 

Delaware   27-4576073
(State or Other Jurisdiction of   (I.R.S. Employer
Incorporation or Organization)   Identification No.)
     
280 Park Avenue, 6th Floor East, New York, NY 10017   10017
(Address of Principal Executive Offices)   (Zip Code)

 

(212) 759-0777

 

(Registrant’s Telephone Number, Including Area Code)

 

 

 

Indicate by check mark whether the registrant: (1) has 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 definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer ¨           Accelerated filer x         Non-accelerated filer ¨        Smaller reporting company ¨

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934). Yes ¨ No x

 

As of May 6, 2016, the Registrant had 54,763,411 shares of common stock, $0.001 par value, outstanding.

 

 

 

 

MEDLEY CAPITAL CORPORATION

TABLE OF CONTENTS

 

Part I.   Financial Information  
       
Item 1.   Financial Statements  
       
    Consolidated Statements of Assets and Liabilities as of March 31, 2016 (unaudited) and September 30, 2015 F-1
       
    Consolidated Statements of Operations for the three and six months ended March 31, 2016 and 2015 (unaudited) F-2
       
    Consolidated Statements of Changes in Net Assets for the six months ended March 31, 2016 and 2015 (unaudited) F-3
       
    Consolidated Statements of Cash Flows for the six months ended March 31, 2016 and 2015 (unaudited) F-4
       
    Consolidated Schedules of Investments as of March 31, 2016 (unaudited) and September 30, 2015 F-5
       
    Notes to Consolidated Financial Statements (unaudited) F-26
       
Item 2.   Management's Discussion and Analysis of Financial Condition and Results of Operations 1
       
Item 3.   Quantitative and Qualitative Disclosures About Market Risk 19
       
Item 4.   Controls and Procedures 20
       
Part II.   Other Information 21
       
Item 1.   Legal Proceedings 21
       
Item 1A.   Risk Factors 21
       
Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds 21
       
Item 3.   Defaults Upon Senior Securities 21
       
Item 4   Mine Safety Disclosures 21
       
Item 5.   Other Information 21
       
Item 6.   Exhibits 21
       
SIGNATURES 23

 

 

 

  

Medley Capital Corporation

 

Consolidated Statements of Assets and Liabilities

 

   As of 
   March 31, 2016   September 30, 2015 
   (unaudited)     
ASSETS          
Investments at fair value          
Non-controlled/non-affiliated investments (amortized cost of $1,020,855,705 and $1,175,785,384, respectively)  $932,053,591   $1,131,893,787 
Controlled investments (amortized cost of $135,799,850 and $86,755,896 respectively)   94,035,961    74,198,202 
Affiliated investments (amortized cost of $10,000,000 and $10,000,000, respectively)   10,000,000    10,000,000 
Total investments at fair value   1,036,089,552    1,216,091,989 
Cash and cash equivalents   12,707,285    15,714,256 
Interest receivable   9,965,754    9,542,547 
Fees receivable   2,305,240    1,389,634 
Receivable for dispositions and investments sold   394,282    578,868 
Other assets   361,960    556,285 
Deferred offering costs   212,036    208,477 
Total assets  $1,062,036,109   $1,244,082,056 
           
LIABILITIES          
Revolving credit facility payable (net of debt issuance costs of $3,517,777 and $4,160,150, respectively)  $21,782,223   $188,539,850 
Term loan payable  (net of debt issuance costs of $2,135,724 and $2,436,590, respectively)   171,864,276    171,563,410 
Notes payable (net of debt issuance costs of $5,138,904 and $2,324,664, respectively)   172,373,921    101,175,336 
SBA debentures payable (net of debt issuance costs of $3,865,627 and $4,206,226, respectively)   146,134,373    145,793,774 
Management and incentive fees payable (See note 6)   5,901,623    9,962,534 
Deferred tax liability   2,155,463    1,797,356 
Interest and fees payable   1,831,590    1,313,931 
Accounts payable and accrued expenses   1,793,833    2,503,442 
Administrator expenses payable (See note 6)   1,042,518    1,000,846 
Deferred revenue   359,190    402,029 
Offering costs payable   25,268    - 
Due to affiliate   -    109,164 
Total liabilities  $525,264,278   $624,161,672 
           
Commitments (See note 8)          
           
NET ASSETS          
Common stock, par value $0.001 per share, 100,000,000 common shares authorized, 54,763,411 and 56,337,152 common shares issued and outstanding, respectively  $54,763   $56,337 
Capital in excess of par value   707,495,752    718,240,597 
Accumulated undistributed net investment income   16,947,233    20,351,831 
Accumulated net realized gain/(loss) from investments   (55,148,334)   (60,625,616)
Net unrealized appreciation/(depreciation) on investments, net of deferred taxes   (132,577,583)   (58,102,765)
Total net assets   536,771,831    619,920,384 
           
Total liabilities and net assets  $1,062,036,109   $1,244,082,056 
           
NET ASSET VALUE PER SHARE  $9.80   $11.00 

 

See accompanying notes to consolidated financial statements.

 

F-1 

 

 

Medley Capital Corporation

 

Consolidated Statements of Operations

 

   For the three months ended March 31   For the six months ended March 31 
   2016   2015   2016   2015 
   (unaudited)   (unaudited)   (unaudited)   (unaudited) 
INVESTMENT INCOME:                    
Interest from investments                    
Non-controlled/non-affiliated investments:                    
Cash  $25,273,975   $31,181,799   $53,399,996   $63,622,513 
Payment-in-kind   2,351,791    1,784,136    3,573,903    3,634,864 
Affiliated investments:                    
Cash   166,750    340,600    333,500    805,152 
Payment-in-kind   -    68,367    -    190,446 
Controlled investments:                    
Cash   22,477    393,423    878,103    794,576 
Payment-in-kind   1,130,729    466,928    2,126,685    951,131 
Total interest income   28,945,722    34,235,253    60,312,187    69,998,682 
Interest from cash and cash equivalents    10,168    1,327    12,403    2,972 
Fee income (See note 9)    1,757,996    2,539,341    4,816,623    6,623,198 
Total investment income   30,713,886    36,775,921    65,141,213    76,624,852 
                     
EXPENSES:                    
Base management fees (See note 6)   4,876,228    5,546,027    10,222,986    11,330,204 
Incentive fees (See note 6)   3,148,783    4,438,250    7,065,252    9,535,758 
Interest and financing expenses   7,920,197    6,248,296    14,890,282    12,604,798 
Administrator expenses (See note 6)   1,042,519    1,098,337    1,958,896    2,120,148 
Professional fees   555,585    839,340    1,188,106    1,372,032 
General and administrative   453,178    585,010    1,163,170    934,859 
Insurance   135,410    142,822    270,819    285,645 
Directors fees   130,062    124,839    263,903    298,375 
Expenses before management and incentive fee waiver   18,261,962    19,022,921    37,023,414    38,481,819 
Management fee waiver (See note 6)   (71,604)   -    (71,604)   - 
Incentive fee waiver (See note 6)   (2,051,784)   -    (2,051,784)   - 
Total expenses net of management and incentive fee waiver   16,138,574    19,022,921    34,900,026    38,481,819 
NET INVESTMENT INCOME    14,575,312    17,753,000    30,241,187    38,143,033 
                     
 REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS:                     
Net realized gain/(loss) from investments    99,234    (9,400,583)   5,477,282    (9,617,167)
Net unrealized appreciation/(depreciation) on investments    (14,093,093)   4,136,169    (74,116,712)   (34,564,168)
Change in provision for deferred taxes on unrealized gain on investments    (133,490)   (705,405)   (358,106)   (494,455)
Net gain/(loss) on investments   (14,127,349)   (5,969,819)   (68,997,536)   (44,675,790)
                     
NET INCREASE/(DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS  $447,963   $11,783,181   $(38,756,349)  $(6,532,757)
                     
WEIGHTED AVERAGE - BASIC AND DILUTED EARNINGS PER COMMON SHARE  $0.01   $0.20   $(0.69)  $(0.11)
WEIGHTED AVERAGE - BASIC AND DILUTED NET INVESTMENT INCOME PER  COMMON SHARE  $0.26   $0.30   $0.54   $0.65 
WEIGHTED AVERAGE COMMON STOCK OUTSTANDING - BASIC AND DILUTED (SEE NOTE 11)   55,761,062    58,499,797    56,044,037    58,617,823 
                     
DIVIDENDS DECLARED PER COMMON SHARE  $0.30   $0.30   $0.60   $0.67 

 

See accompanying notes to consolidated financial statements.

 

F-2 

 

 

Medley Capital Corporation

 

Consolidated Statements of Changes in Net Assets

 

   For the six months ended March 31 
   2016   2015 
   (unaudited)   (unaudited) 
OPERATIONS:          
Net investment income  $30,241,187   $38,143,033 
Net realized gain/(loss) from investments   5,477,282    (9,617,167)
Net unrealized appreciation/(depreciation) on investments   (74,116,712)   (34,564,168)
Change in provision for deferred taxes on unrealized gain on investments   (358,106)   (494,455)
Net increase/(decrease) in net assets from operations   (38,756,349)   (6,532,757)
SHAREHOLDER DISTRIBUTIONS:          
Distributions from net investment income   (33,645,784)   (39,299,875)
Net decrease in net assets from shareholder distributions   (33,645,784)   (39,299,875)
CAPITAL SHARE TRANSACTIONS:          
Repurchase of common stock under stock repurchase program (1,573,741 and 825,677 shares, respectively)   (10,699,990)   (7,929,602)
Offering costs   (46,430)   - 
Net increase/(decrease) in net assets from common share transactions   (10,746,420)   (7,929,602)
Total increase/(decrease) in net assets   (83,148,553)   (53,762,234)
Net assets at beginning of period   619,920,384    729,856,881 
Net assets at end of period including accumulated undistributed net investment income of $16,947,233 and $20,516,952, respectively  $536,771,831   $676,094,647 
           
Net asset value per common share  $9.80   $11.68 
Common shares outstanding at end of period   54,763,411    57,907,607 

 

See accompanying notes to consolidated financial statements.

 

F-3 

 

 

Medley Capital Corporation

 

Consolidated Statements of Cash Flows

  

   For the six months ended March 31 
   2016   2015 
   (unaudited)   (unaudited) 
Cash flows from operating activities          
NET INCREASE/(DECREASE) IN NET ASSETS FROM OPERATIONS  $(38,756,349)  $(6,532,757)
ADJUSTMENTS TO RECONCILE NET INCREASE/(DECREASE) IN NET ASSETS FROM OPERATIONS TO NET CASH PROVIDED/(USED) BY OPERATING ACTIVITIES:          
Investment increases due to payment-in-kind interest   (7,553,996)   (4,762,063)
Net amortization of premium/(discount) on investments   (446,191)   (929,849)
Amortization of debt issuance costs   1,701,963    1,195,227 
Net realized (gain)/loss from investments   (5,477,282)   9,617,167 
Net deferred income taxes   358,106    494,455 
Net unrealized (appreciation)/depreciation on investments   74,116,712    34,564,168 
Proceeds from sale and settlements of investments   195,075,586    173,857,867 
Purchases, originations and participations   (75,712,392)   (178,491,717)
(Increase)/decrease in operating assets:          
Interest receivable   (423,207)   (530,383)
Fees receivable   (915,606)   618,482 
Other assets   194,325    292,532 
Receivable for dispositions and investments sold   184,586    9,716,835 
Increase/(decrease) in operating liabilities:          
Payable for investments purchased, originated and participated   -    (54,995,000)
Management and incentive fees payable, net   (4,060,911)   (460,534)
Accounts payable and accrued expenses   (709,609)   (124,128)
Interest and fees payable   517,659    (900,643)
Administrator expenses payable   41,672    85,872 
Deferred revenue   (42,839)   76,056 
Due to affiliate   (109,164)   (22,798)
NET CASH PROVIDED/(USED) BY OPERATING ACTIVITIES   137,983,063    (17,231,211)
           
Cash flows from financing activities          
Repurchase of common stock under stock repurchase program   (10,699,990)   (7,929,602)
Offering costs paid   (24,720)   (73,636)
Borrowings on debt   118,112,825    101,500,000 
Paydowns on debt   (211,500,000)   (44,000,000)
Financing costs paid   (3,232,365)   (550,850)
Payments of cash dividends   (33,645,784)   (39,299,875)
NET CASH PROVIDED/(USED) BY FINANCING ACTIVITIES   (140,990,034)   9,646,037 
           
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS   (3,006,971)   (7,585,174)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD   15,714,256    36,731,488 
CASH AND CASH EQUIVALENTS, END OF PERIOD  $12,707,285   $29,146,314 
           
Supplemental Information:          
Interest paid during the period  $10,018,155   $12,271,761 
Supplemental non-cash information:          
Payment-in-kind interest income  $5,700,588   $4,776,441 
Net amortization of premium/(discount) on investments  $446,191   $929,849 
Amortization of debt issuance costs  $(1,701,963)  $(1,195,227)

 

See accompanying notes to consolidated financial statements.

 

F-4 

 

 

Medley Capital Corporation

 

Consolidated Schedule of Investments 

 

March 31, 2016 

 

(Unaudited)

  

Company (1)  Industry  Type of Investment  Maturity  Par Amount (2)   Cost(3)   Fair Value   % of
 Net Assets (4)
 
                          
Non-Controlled/ Non-Affiliated Investments:                        
                              
AAR Intermediate Holdings LLC(12)  Energy:  Oil & Gas  Senior Secured First Lien Term Loan (LIBOR + 14.00% PIK, 1.00% LIBOR Floor)(10)(19)  3/30/2019   32,154,522    27,980,664    17,266,657    3.2%
      Warrants to purchase 2.51% of outstanding company equity  3/30/2019   -    2,274,480    -    0.0%
             32,154,522    30,255,144    17,266,657      
                              
Accupac, Inc.  Containers, Packaging & Glass  Senior Secured Second Lien Term Loan (LIBOR + 10.00% Cash, 1.00% LIBOR Floor) (18)  7/14/2020   31,000,000    31,000,000    30,888,400    5.8%
             31,000,000    31,000,000    30,888,400      
                              
Advanced Diagnostic Holdings, LLC  Healthcare & Pharmaceuticals  Senior Secured First Lien Term Loan (LIBOR + 8.75% Cash, 0.875% LIBOR Floor) (19)  12/11/2020   15,457,036    15,457,036    15,457,036    2.9%
             15,457,036    15,457,036    15,457,036      
                              
Albertville Quality Foods, Inc. (12)  Beverage & Food  Senior Secured First Lien Term Loan (LIBOR + 9.50% Cash, 1.00% LIBOR Floor, 3.00% LIBOR Cap)(18)  10/31/2018   16,190,258    16,190,258    16,256,800    3.0%
             16,190,258    16,190,258    16,256,800      
                              
Access Media Holdings, LLC (9)  Media:  Broadcasting & Subscription  Senior Secured First Lien Term Loan (10.00%)  7/22/2020   7,729,447    7,729,447    7,729,447    1.4%
      Preferred Equity Series A (12.00% PIK)  7/22/2020   1,703,108    1,703,108    550,342    0.1%
      Preferred Equity Series AA (12.00% PIK)  7/22/2020   275,691    275,691    275,691    0.1%
      16% of Common Equity of Newco  7/22/2020   -    -    -    0.0%
             9,708,246    9,708,246    8,555,480      
                              
American Covers, Inc.  Consumer goods:  Non-durable  Senior Secured Second Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(19)  3/1/2021   10,000,000    10,000,000    9,898,400    1.9%
             10,000,000    10,000,000    9,898,400      
                              
Autosplice, Inc. (7)(9)  High Tech Industries  Senior Secured First Lien Term Loan (LIBOR + 11.50% Cash, 1.00% LIBOR Floor)(19)  6/30/2019   14,632,621    14,632,621    14,341,783    2.7%
             14,632,621    14,632,621    14,341,783      
                              
Backcountry.com, LLC  Retail  Senior Secured First Lien Term Loan (LIBOR + 7.25% Cash, 1.00% LIBOR Floor)(19)  6/30/2020   2,567,188    2,567,188    2,549,859    0.5%
             2,567,188    2,567,188    2,549,859      

 

F-5

 

  

BayDelta Maritime LLC  Transportation:  Cargo  Warrants to purchase 10% of the outstanding equity  6/30/2016   -    25,000    538,566    0.1%
             -    25,000    538,566      
                              
Be Green Packaging, LLC (7)(9)  Containers, Packaging & Glass  Senior Secured First Lien Term Loan (LIBOR + 12.00%, 1.00% LIBOR Floor)(19)  12/13/2018   5,000,000    5,000,000    4,829,200    0.9%
      Senior Secured First Lien Delayed Draw (LIBOR + 12.00%, 1.00% LIBOR Floor)(19)  12/13/2018   3,416,667    3,416,667    3,325,544    0.6%
      Revolver (LIBOR + 12.00%, 1.00% LIBOR Floor)(19)  12/13/2018   354,167    354,167    329,475    0.1%
      1.563% Partnership Interest in RCAF VI CIV XXIII, L.P.  12/13/2018   -    416,250    21,399    0.0%
             8,770,834    9,187,084    8,505,618      
                              
Black Angus Steakhouses, LLC (7)(9)  Hotel, Gaming & Leisure  Senior Secured First Lien Term Loan (LIBOR + 9.00% Cash, 1.00% LIBOR Floor)(18)  4/24/2020   8,008,929    8,008,929    7,925,519    1.5%
      Senior Secured First Lien Delayed Draw (LIBOR + 9.00%, 1.00% LIBOR Floor)  4/24/2020   -    -    -    0.0%
      Revolver (LIBOR + 9.00%, 1.00% LIBOR Floor)(27)  4/24/2020   267,857    267,857    263,339    0.0%
             8,276,786    8,276,786    8,188,858      
                              
Brantley Transportation LLC (12)  Energy:  Oil & Gas  Senior Secured First Lien Term Loan (12.00% PIK)(10)  8/2/2017   9,465,323    9,076,715    5,034,321    0.9%
             9,465,323    9,076,715    5,034,321      
                              
Calloway Laboratories, Inc.  Healthcare & Pharmaceuticals  Senior Secured First Lien Term Loan (17.00% PIK) (10)  9/30/2016   42,106,611    29,554,318    -    0.0%
      Warrants to purchase 15.00% of the outstanding equity  9/30/2016   -    68,433    -    0.0%
             42,106,611    29,622,751    -      
                              
CP OPCO LLC  Services:  Consumer  Senior Secured First Lien Term Loan (LIBOR + 6.75% Cash, 1.00% LIBOR Floor)(19)  9/30/2020   17,000,000    17,000,000    16,896,130    3.1%
             17,000,000    17,000,000    16,896,130      
                              
ContMid Intermediate Inc.(12)  Automotive  Senior Secured Second Lien Term Loan (LIBOR + 9.00% Cash, 1.00% LIBOR Floor)(18)  10/25/2019   23,000,000    23,000,000    22,863,150    4.3%
             23,000,000    23,000,000    22,863,150      
                              
ConvergeOne Holdings Corporation  Telecommunications  Senior Secured Second Lien Term Loan (LIBOR + 8.00% Cash, 1.00% LIBOR Floor)(19)  6/17/2021   12,500,000    12,399,256    11,999,500    2.2%
             12,500,000    12,399,256    11,999,500      

 

F-6

 

  

Crow Precision Components LLC  Aerospace & Defense  Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(18)  9/30/2019   13,930,000    13,930,000    13,866,897    2.6%
      350 units of outstanding equity in Wingman Holdings, Inc.  9/30/2019   -    700,000    731,591    0.1%
             13,930,000    14,630,000    14,598,488      
                              
DHISCO Electronic Distribution, Inc. (7)(9)(12)  Hotel, Gaming & Leisure  Senior Secured First Lien Term Loan A (LIBOR + 9.00%, 1.50% LIBOR Floor)  11/10/2019   31,238,095    31,238,095    30,557,105    5.7%
      Senior Secured First Lien Term Loan B (10.50% PIK)   2/10/2018   6,620,694    6,620,694    6,463,850    1.2%
      Revolving Credit Facility (LIBOR + 9.00%, 1.50% LIBOR Floor)(24)   5/10/2017   -    -    -    0.0%
      Equity - 1,230,769 Units(22)   2/10/2018   -    1,230,769    307,692    0.1%
             37,858,789    39,089,558    37,328,647      
                              
DLR Restaurants LLC (12)  Hotel, Gaming & Leisure  Senior Secured First Lien Term Loan (11.00% Cash, 2.50% PIK)  4/18/2018   23,813,079    23,813,079    23,280,142    4.3%
      Unsecured Debt (12.00% Cash, 4.00% PIK)  4/18/2018   281,754    281,754    276,237    0.1%
             24,094,833    24,094,833    23,556,379      
                              
Dream Finders Homes, LLC  Construction & Building  Senior Secured First Lien Term Loan B (LIBOR + 14.50% Cash)  10/1/2018   10,132,046    10,029,484    9,946,427    1.9%
      5,000 common units represent 5% of the outstanding equity interest of Dream Finders Holdings, LLC  10/1/2018   -    180,000    1,046,482    0.2%
             10,132,046    10,209,484    10,992,909      
                              
Dynamic Energy Services International LLC  Energy:  Oil & Gas  Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(18)  3/6/2018   17,100,000    17,100,000    17,063,919    3.2%
             17,100,000    17,100,000    17,063,919      
                              
Essex Crane Rental Corp. (12)  Construction & Building  Senior Secured First Lien Term Loan (LIBOR + 12.50% PIK, 1.00% LIBOR Floor)(10)(19)  5/13/2019   21,653,232    20,460,116    3,681,483    0.7%
             21,653,232    20,460,116    3,681,483      
                              
FKI Security Group LLC (12)  Capital Equipment  Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(19)  3/30/2020   14,718,750    14,718,750    14,323,846    2.7%
             14,718,750    14,718,750    14,323,846      
                              
Footprint Acquisition LLC  Services:  Business  Senior Secured First Lien Term Loan (LIBOR + 8.00% Cash) (18)  2/27/2020   5,250,102    5,250,102    5,144,050    1.0%
      Preferred Equity  (8.75% PIK)  2/27/2020   5,502,335    5,502,335    4,884,093    0.9%
      150.0 units of Common Stock(23)  2/27/2020   -    -    352,230    0.1%
             10,752,437    10,752,437    10,380,373      
                              
Freedom Powersports LLC  Automotive  Senior Secured First Lien Term Loan (LIBOR + 11.50% Cash, 1.50% LIBOR Floor)(19)  9/26/2019   14,630,000    14,630,000    14,656,041    2.7%
             14,630,000    14,630,000    14,656,041      
                              
Harrison Gypsum LLC (12)  Construction & Building  Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 0.50% PIK, 1.50% LIBOR Floor)(18)  12/21/2018   54,957,486    54,957,486    53,760,512    10.0%
             54,957,486    54,957,486    53,760,512      
                              
Heligear Acquisition Co.  Aerospace & Defense  Senior Secured First Lien Note (10.25% Cash)  10/15/2019   20,000,000    20,000,000    20,444,600    3.8%
             20,000,000    20,000,000    20,444,600     

 

F-7

 

 

JD Norman Industries, Inc.  Automotive  Senior Secured First Lien Term Loan (LIBOR + 12.25% Cash) (18)  3/6/2019   21,900,000    21,900,000    20,599,578    3.8%
             21,900,000    21,900,000    20,599,578      
                              
Jordan Reses Supply Company, LLC  Healthcare & Pharmaceuticals  Senior Secured Second Lien Term Loan (LIBOR + 11.00%, 1.00% LIBOR Floor)  4/24/2020   20,000,000    20,000,000    20,093,200    3.8%
             20,000,000    20,000,000    20,093,200      
                              
Lighting Science Group Corporation  Containers, Packaging & Glass  Senior Secured Second Lien Term (LIBOR + 10.00% Cash, 2.00% PIK) (19)  2/19/2019   15,890,344    15,259,966    15,000,008    2.8%
      Warrants to purchase 1.00% of the outstanding equity  2/19/2019   -    955,680    200,000    0.0%
             15,890,344    16,215,646    15,200,008      
                              
LSF9 Atlantis Holdings, LLC  Retail  Senior Secured First Lien Term Loan (LIBOR + 9.00% Cash, 1.00% LIBOR Floor)  1/15/2021   10,000,000    9,903,221    9,900,000    1.9%
             10,000,000    9,903,221    9,900,000      
                              
Lucky Strike Entertainment, L.L.C.  Hotel, Gaming & Leisure  Senior Secured Second Lien Term
Loan (LIBOR + 13.00% Cash,
1.00% LIBOR Floor)(19)
  12/24/2019   10,254,472    10,254,472    10,282,159    1.9%
             10,254,472    10,254,472    10,282,159      
                              
Lydell Jewelry Design Studio, LLC (12)  Consumer goods:  Non-durable  Senior Secured First Lien Term Loan (LIBOR + 5.50% Cash, 7.50% PIK, 1.50% LIBOR Floor)(10)(18)  9/13/2018   14,992,478    14,269,868    6,002,239    1.1%
      Warrants to purchase 13.3% of the outstanding membership units  9/13/2018   -    -    -    0.0%
             14,992,478    14,269,868    6,002,239      
                              
Merchant Cash and Capital, LLC  Banking, Finance, Insurance & Real Estate  Senior Secured First Lien Delayed Draw (LIBOR + 8.00% Cash, 3.00% LIBOR Floor)(18)  12/4/2016   17,500,000    17,500,000    17,500,000    3.3%
      Senior Secured Second Lien Term Loan (12.00% Cash)  5/4/2017   15,000,000    15,000,000    14,926,950    2.8%
             32,500,000    32,500,000    32,426,950      
                              
Miratech Intermediate Holdings, Inc. (12)  Automotive  Senior Secured First Lien Term Loan (LIBOR + 9.00% Cash, 1.00% LIBOR Floor, 2.00% PIK)(18)  5/9/2019   13,081,744    13,081,744    12,605,961    2.3%
             13,081,744    13,081,744    12,605,961      

 

F-8

 

 

Momentum Telecom, Inc.  Telecommunications  Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(18)  3/10/2019   8,970,871    8,970,871    9,060,580    1.7%
             8,970,871    8,970,871    9,060,580      
                              
Nation Safe Drivers Holdings, Inc.  Banking, Finance, Insurance & Real Estate  Senior Secured Second Lien Term Loan (LIBOR + 8.00% Cash, 2.00% LIBOR Floor)(19)  9/29/2020   35,278,846    35,278,846    34,493,892    6.4%
             35,278,846    35,278,846    34,493,892      
                              
Nielsen & Bainbridge, LLC  Consumer goods:  Durable  Senior Secured Second Lien Term Loan (LIBOR + 9.25% Cash, 1.00% LIBOR Floor)(18)  8/15/2021   25,000,000    25,000,000    23,997,500    4.5%
             25,000,000    25,000,000    23,997,500      
                              
NorthStar Group Services, Inc.  Construction & Building  Unsecured Debt (6.00% Cash, 12.00% PIK)  10/24/2019   24,407,394    24,407,394    24,407,394    4.5%
             24,407,394    24,407,394    24,407,394     
                              
Oxford Mining Company, LLC  Metals & Mining  Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 3.00% PIK, 0.75% LIBOR Floor)  12/31/2018   20,421,328    20,421,328    19,530,754    3.6%
             20,421,328    20,421,328    19,530,754      
                              
The Plastics Group, Inc.  Chemicals, Plastics & Rubber  Senior Secured First Lien Term Loan (11.00% Cash, 2.00% PIK)  2/28/2019   21,646,499    21,646,499    20,985,199    3.9%
             21,646,499    21,646,499    20,985,199      
                              
Point.360 (7)(9)  Services:  Business  Senior Secured First Lien Term Loan (LIBOR + 6.00% Cash)  7/8/2020   1,600,000    1,600,000    1,584,083    0.3%
      Equity - 479,283 Common Shares(25)  7/8/2020   -    129,406    304,345    0.1%
      Warrants to purchase 2.8% of the outstanding common shares (26)  7/8/2020   -    52,757    201,176    0.0%
             1,600,000    1,782,163    2,089,604      
                              
Prestige Industries LLC  Services:  Business  Senior Secured Second Lien Term Loan (10.00% Cash, 3.00% PIK)  11/1/2017   7,563,723    7,529,676    6,898,267    1.3%
      Warrants to purchase 0.63% of the outstanding common units  11/1/2017   -    151,855    -    0.0%
             7,563,723    7,681,531    6,898,267      
                              
Prince Mineral Holding Corp.(8)  Wholesale  Senior Secured First Lien Note (11.50%)  12/15/2019   6,800,000    6,749,846    5,907,500    1.1%
             6,800,000    6,749,846    5,907,500      
                              
RCS Management Corporation & Specialized Medical Services, Inc. (7)(9)  Healthcare & Pharmaceuticals  Senior Secured Second Lien Term Loan (LIBOR + 11.00% Cash, 1.50% LIBOR Floor, 0.50% PIK)(18)  8/29/2016   32,825,353    32,825,353    32,825,353    6.1%
             32,825,353    32,825,353    32,825,353      
                              
Reddy Ice Corporation  Beverage & Food  Senior Secured Second Lien Term Loan (LIBOR + 9.50% Cash, 1.25% LIBOR Floor)(18)  11/1/2019   17,000,000    17,000,000    13,122,640    2.5%
             17,000,000    17,000,000    13,122,640      
                              
Response Team Holdings, LLC  Construction & Building  Preferred Equity (12.00% PIK)  3/28/2019   5,891,527    5,598,437    5,891,527    1.1%
      Warrants to purchase 7.2% of the outstanding common units  3/28/2019   -    429,012    1,519,529    0.3%
             5,891,527    6,027,449    7,411,056      
                              
Safeworks, LLC(12)  Capital Equipment  Unsecured Debt (12.00% Cash)  1/31/2020   15,000,000    15,000,000    14,901,600    2.8%
             15,000,000    15,000,000    14,901,600      
                              
Sendero Drilling Company, LLC  Energy:  Oil & Gas  Senior Secured First Lien Term Loan (LIBOR + 11.00% Cash) (18)  3/18/2019   7,539,003    7,011,495    7,592,831    1.4%
      Warrants to purchase 5.52% of the outstanding common units  3/18/2019   -    793,523    5,326,327    1.0%
             7,539,003    7,805,018    12,919,158      

 

F-9

 

 

Seotowncenter, Inc.(12)  Services:  Business  Senior Secured First Lien Term Loan (LIBOR + 9.00% Cash, 1.00% LIBOR Floor)(19)  9/11/2019   27,156,250    27,156,250    26,672,597    5.0%
      3,249.697 shares of Common Stock(14)  9/11/2019   -    500,000    158,299    0.0%
             27,156,250    27,656,250    26,830,896      
                              
Ship Supply Acquisition Corporation (7)(9)  Services:  Business  Senior Secured First Lien Term Loan (LIBOR + 8.00% Cash, 1.00% LIBOR Floor)(19)  7/31/2020   8,286,197    8,286,197    8,238,635    1.5%
      Revolver (LIBOR + 8.00% Cash, 1.00% LIBOR Floor)(19)(20)  7/31/2016   570,032    570,032    570,032    0.1%
             8,856,229    8,856,229    8,808,667      
                              
Stancor, Inc.  Services:  Business  Senior Secured First Lien Term Loan (LIBOR + 8.00% Cash, 0.75% LIBOR Floor)(18)  8/19/2019   5,981,818    5,981,818    5,811,755    1.1%
      263,814.43 Class A Units(15)  8/19/2019   -    263,814    268,135    0.0%
             5,981,818    6,245,632    6,079,890      
                              
T Residential Holdings, LLC  Banking, Finance, Insurance & Real Estate  Senior Secured First Lien Term Loan (12.00%)  3/28/2019   19,000,000    19,000,000    18,836,410    3.5%
             19,000,000    19,000,000    18,836,410      
                              
Taylored Freight Services, LLC  Services:  Business  Senior Secured Second Lien Term Loan (LIBOR + 9.50% Cash, 2.00% PIK, 1.50% LIBOR Floor)(19)  11/1/2017   15,104,823    15,104,823    14,129,354    2.6%
             15,104,823    15,104,823    14,129,354      
                              
Tenere Acquisition Corp.(7)(9)  Chemicals, Plastics & Rubber  Senior Secured First Lien Term Loan (11.00% Cash, 2.00% PIK)  12/15/2017   11,206,394    11,206,394    11,206,526    2.1%
             11,206,394    11,206,394    11,206,526      
                              
Transtelco Inc.  Telecommunications  Senior Secured First Lien Term Loan (LIBOR + 9.00% Cash, 1.50% LIBOR Floor)(18)  11/19/2017   18,768,000    18,768,000    18,769,501    3.5%
             18,768,000    18,768,000    18,769,501      
                              
Untangle, Inc.  Services:  Business  Senior Secured First Lien Term Loan (LIBOR + 14.00% Cash) (18)  4/18/2019   9,183,233    9,183,233    9,217,028    1.7%
             9,183,233    9,183,233    9,217,028      
                              
Velocity Pooling Vehicle LLC  Automotive  Senior Secured Second Lien Term Loan (LIBOR + 7.25% Cash, 1.00% LIBOR Floor)(18)  5/14/2022   24,000,000    21,166,468    16,714,560    3.1%
             24,000,000    21,166,468    16,714,560      
                              
Watermill-QMC Midco, Inc.  Automotive  Senior Secured First Lien Term Loan (13.00% Cash)  6/30/2020   18,150,941    18,150,941    18,064,180    3.4%
      1.3% Partnership Interest in Watermill-QMC Midco Inc. (6)  6/30/2020   -    295,362    388,239    0.1%
             18,150,941    18,446,303    18,452,419      
                              
Wheels Up Partners LLC (12)  Aerospace & Defense  Senior Secured First Lien Delayed Draw (LIBOR + 8.55% Cash, 1.00% LIBOR Floor)(19)  10/15/2021   17,460,375    17,460,375    17,319,993    3.2%
             17,460,375    17,460,375    17,319,993      
                              
Subtotal Non-Controlled / Non-Affiliated Investments     $1,036,088,643   $1,020,855,705   $932,053,591      

   

F-10

 

 

Control Investments:(5)

 

Capstone Nutrition (12)  Healthcare & Pharmaceuticals  Senior Secured First Lien Term Loan (LIBOR + 12.50% PIK, 1.00% LIBOR Floor)(10)(19)  4/28/2019   21,274,077    20,803,397    13,115,894    2.4%
      Senior Secured First Lien Delayed Draw (LIBOR + 12.50% PIK, 1.00% LIBOR Floor)(10)(19)  4/28/2019   6,996,223    6,885,956    4,313,312    0.8%
      7,463.4 Class B Shares, and 15,079.0 Class C Shares represent 33.0% ownership of Cornerstone Research & Development, Inc.  4/28/2019   -    12    -    0.0%
      384.62 Units of Common Stock (13)  4/28/2019   -    400,000    -    0.0%
             28,270,300    28,089,365    17,429,206      
                              
MCC Senior Loan Strategy JV I LLC(11)  Multisector Holdings  Equity - 87.5% ownership of MCC Senior Loan Strategy JV I LLC      -    23,187,500    23,273,450    4.3%
             -    23,187,500    23,273,450      
                              
OmniVere, LLC  Services:  Business  Senior Secured First Lien Term Loan (LIBOR + 13.00% PIK) (19)  5/5/2019   20,865,004    20,510,132    20,865,004    3.9%
      Unsecured Debt  (8.00% PIK) (10)  7/24/2025   21,902,369    20,756,913    13,455,063    2.5%
      Warrants to purchase outstanding equity (21)  5/5/2019   -    872,698    -    0.0%
             42,767,373    42,139,743    34,320,067      
                              
United Road Towing, Inc.  Services:  Business  Senior Secured Second Lien Term Loan (LIBOR + 9.00% PIK)  2/21/2020   17,826,970    17,826,970    17,826,970    3.3%
      Preferred Equity Class C (8.00% PIK) (10)  2/21/2020   18,802,789    17,087,229    1,186,268    0.2%
      Preferred Equity  Class C-1 (8.00% PIK) (10)  2/21/2020   2,146,938    1,706,092    -    0.0%
      Preferred Equity  Class A-2 (8.00% PIK) (10)  2/21/2020   5,200,115    4,664,855    -    0.0%
      65,809.73 Class B Common Units(16)  2/21/2020   -    1,098,096    -    0.0%
             43,976,812    42,383,242    19,013,238      
                              
Subtotal Control Investments        $115,014,485   $135,799,850   $94,035,961      
                           
Affiliated Investments:                          
                              
US Multifamily, LLC(11)  Banking, Finance, Insurance & Real Estate  Senior Secured First Lien Term Loan (10.00% Cash)  9/10/2019   6,670,000    6,670,000    6,670,000    1.2%
      Preferred Equity - 33,300 Units(17)  9/10/2019   -    3,330,000    3,330,000    0.6%
             6,670,000    10,000,000    10,000,000      
                              
Subtotal Affiliated Investments        $6,670,000   $10,000,000   $10,000,000      
                              
Total Investments, March 31, 2016        $1,157,773,128   $1,166,655,555   $1,036,089,552    193.0%

 

F-11

 

  

(1)All of our investments are domiciled in the United States. Certain investments also have international operations.

(2)Par amount includes accumulated PIK interest and is net of repayments.

(3)Gross unrealized appreciation, gross unrealized depreciation, and net depreciation for federal income tax purposes totaled $17.0 million, $130.0 million and $113.0 million, respectively. The tax cost of investments is $1,149.1 million.

(4)Percentage is based on net assets of $536,771,831 as of March 31, 2016.

(5)Control Investments are defined by the Investment Company Act of 1940 ("1940 Act") as investments in companies in which the Company owns more than 25% of the voting securities or maintains greater than 50% of the board representation.

(6)12,711 Units represents 1.3% of partnership interest in Watermill-QMC Partners, LP.

(7)The investment has an unfunded commitment as of March 31, 2016 (See note 8).

(8)Securities are exempt from registration under Rule 144a of the Securities Act of 1933. This security represents a fair value of $5.9 million and 1.1% of net assets as of March 31, 2016 and is considered restricted.

(9)Includes an analysis of the value of any unfunded loan commitments.

(10)The investment was on non-accrual status as of March 31, 2016.

(11)The investment is not a qualifying asset as defined under Section 55(a) of 1940 Act, in a whole, or in part.

(12)A portion of this investment was sold via a participation agreement (See note 3).

(13)384.62 Units represents 1.55% ownership of Cornerstone Research & Development Inc.

(14)3,249.697 shares of Common Stock represents 2.917% ownership of Boostability Holdings, Inc.

 

F-12

 

 

(15)263,814.43 Class A Units represents 0.882% ownership of Stancor, Inc.

(16)65,809.73 Class B Common Units Represents 65.8% ownership of United Road Towing, Inc.

(17)33,300 Units represents 18.167% ownership of US Multifamily, LLC.

(18)The interest rate on these loans is subject to a base rate plus 1 Month London Interbank Offering Rate ("LIBOR"), which at March 31, 2016 was 0.44%. As the interest rate is subject to a minimum LIBOR Floor which was greater than the 1 Month LIBOR rate at March 31, 2016, the prevailing rate in effect at March 31, 2016 was the base rate plus the LIBOR Floor.

(19)The interest rate on these loans is subject to a base rate plus 3 Month LIBOR, which at March 31, 2016 was 0.64%. As the interest rate is subject to a minimum LIBOR Floor which was greater than the 3 Month LIBOR rate at March 31, 2016, the prevailing rate in effect at March 31, 2016 was the base rate plus the LIBOR Floor.

(20)The investment earns 0.50% commitment fee on all unused commitment. At March 31, 2016, there was $466,390 of unused commitment.

(21)5,055.56 Units of Common Stock, represents 50.56% of the outstanding equity.

(22)1,230,769 Units represents 4.17% ownership of Pegasus Solutions, Inc.

(23)150 Units represents 15.0% of Footprint Holding Company, Inc.

(24)The investment earns 0.50% commitment fee on all unused commitment. At March 31, 2016, there was $3,047,619 of unused commitment.

(25)479,283 Common Shares represents 3.8% of the outstanding common shares in Point.360.

(26)351,713 Units represents 2.8% of the outstanding common shares in Point.360.

(27)The investment earns 0.50% commitment fee on all unused commitment. At March 31, 2016, there was $625,000 of unused commitment.

 

See accompanying notes to consolidated financial statements.

 

F-13

 

 

Medley Capital Corporation 

 

Consolidated Schedule of Investments 

 

September 30, 2015 

 

Company (1)   Industry   Type of Investment   Maturity   Par Amount (2)     Cost(3)     Fair Value     % of
 Net Assets (4)
 
                                     
Non-Controlled/ Non-Affiliated Investments:                                    
                                             
AAR Intermediate Holdings LLC(11)   Energy:  Oil & Gas   Senior Secured First Lien Term Loan  (LIBOR + 12.00%, 1.00% LIBOR Floor)(18)   3/30/2019     31,966,906       30,302,821       22,503,872       3.6 %
        Warrants to purchase 1.80% of outstanding company equity   3/30/2019     -       2,274,480       -       0.0 %
                  31,966,906       32,577,301       22,503,872          
                                             
Accupac, Inc.   Containers, Packaging & Glass   Senior Secured Second Lien Term Loan (LIBOR + 10.00% Cash, 1.00% LIBOR Floor) (17)   3/20/2020     35,000,000       35,000,000       34,680,800       5.6 %
                  35,000,000       35,000,000       34,680,800          
                                             
AESC Holding Corp, Inc.   Retail   Senior Secured Second Lien Term Loan (LIBOR + 9.00% Cash, 1.00% LIBOR Floor)(17)   5/27/2019     20,000,000       20,000,000       20,149,200       3.3 %
                  20,000,000       20,000,000       20,149,200          

 

F-14

 

  

Company (1)   Industry   Type of Investment   Maturity   Par Amount (2)     Cost(3)     Fair Value     % of
 Net Assets (4)
 
                                             
Albertville Quality Foods, Inc. (11)   Beverage & Food(26)   Senior Secured First Lien Term Loan(17)
(LIBOR + 9.50% Cash, 1.00%
LIBOR Floor, 3.00% LIBOR Cap)
  10/31/2018     17,452,830       17,452,830       17,580,585       2.8 %
                  17,452,830       17,452,830       17,580,585          
                                             
Access Media Holdings, LLC (7)   Media:  Broadcasting & Subscription   Senior Secured First Lien Term Loan (10.00%)   7/22/2020     7,536,913       7,536,913       7,536,913       1.2 %
        Preferred Equity (12.00% PIK)   7/22/2020     1,187,417       1,187,417       207,578       0.0 %
        16% of Common Equity of Newco   7/22/2020     -       -       -       0.0 %
                  8,724,330       8,724,330       7,744,491          
                                             
American Covers, Inc.   Consumer Discretionary   Senior Secured Second Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(18)   3/1/2021     10,000,000       10,000,000       10,000,000       1.6 %
                  10,000,000       10,000,000       10,000,000          
                                             
Aurora Flight Sciences Corporation   Aerospace & Defense   Senior Secured Second Lien Term Loan
(11.25% Cash, 2.00% PIK)
  3/16/2016     16,461,545       16,461,545       16,461,545       2.7 %
                  16,461,545       16,461,545       16,461,545          
                                             
Autosplice, Inc. (7)(9)   High Tech Industries   Senior Secured First Lien Term Loan (LIBOR + 11.50% Cash, 1.00% LIBOR Floor)(18)   6/30/2019     14,817,844       14,817,844       14,773,761       2.4 %
                  14,817,844       14,817,844       14,773,761          
                                             
Backcountry.com, LLC(27)   Retail   Senior Secured First Lien Term Loan (LIBOR + 7.25% Cash, 1.00% LIBOR Floor)(18)   6/30/2020     2,583,333       2,583,333       2,583,333       0.4 %
                  2,583,333       2,583,333       2,583,333          
                                             
BayDelta Maritime LLC   Transportation:  Cargo   Warrants to purchase 10% of the outstanding equity   6/30/2016     -       25,000       460,099       0.1 %
                  -       25,000       460,099          
                                             
Be Green Packaging, LLC (7)(9)   Containers, Packaging & Glass   Senior Secured First Lien Term Loan (LIBOR + 10.00%, 1.00% LIBOR Floor)(18)   12/13/2018     5,000,000       5,000,000       4,823,494       0.8 %
        Senior Secured First Lien Delayed Draw (LIBOR + 10.00%, 1.00% LIBOR Floor)(18)   12/13/2018     3,416,667       3,416,667       3,294,714       0.5 %
        Revolver (LIBOR + 10.00%, 1.00% LIBOR Floor)(18)   12/13/2018     354,167       354,167       327,425       0.1 %
        1.13% Partnership Interest in RCAF VI CIV XXIII, L.P.   12/13/2018     -       416,250       230,894       0.0 %
                  8,770,834       9,187,084       8,676,527          
                                             
Black Angus Steakhouses, LLC (7)(9)   Hotel, Gaming & Leisure   Senior Secured First Lien Term Loan (LIBOR + 9.00% Cash, 1.00% LIBOR Floor)(17)   4/24/2020     8,111,607       8,111,607       8,111,607       1.3 %
        Senior Secured First Lien Delayed Draw (LIBOR + 9.00%, 1.00% LIBOR Floor)   4/24/2020     -       -       -       0.0 %
        Revolver (LIBOR + 9.00%, 1.00% LIBOR Floor)   4/24/2020     446,429       446,429       446,429       0.1 %
                  8,558,036       8,558,036       8,558,036          

 

F-15

 

 

Company (1)   Industry   Type of Investment   Maturity   Par Amount (2)     Cost(3)     Fair Value     % of
 Net Assets (4)
 
                                     
Brantley Transportation LLC (11)   Energy:  Oil & Gas   Senior Secured First Lien Term Loan (12.00%)   8/2/2017     9,000,000       9,100,912       6,332,324       1.0 %
                  9,000,000       9,100,912       6,332,324          
                                             
California Products Corporation   Chemicals, Plastics & Rubber   Senior Secured Second Lien Term Loan (13.00%)   5/27/2019     13,750,000       13,750,000       13,837,313       2.2 %
                  13,750,000       13,750,000       13,837,313          
                                             
Calloway Laboratories, Inc.   Healthcare & Pharmaceuticals   Senior Secured First Lien Term Loan (17.00% PIK) (10)   9/30/2016     38,860,511       29,573,477       -       0.0 %
        Warrants to purchase 15.00% of the outstanding equity   9/30/2016     -       68,433       -       0.0 %
                  38,860,511       29,641,910       -          
                                             
Capstone Nutrition   Healthcare & Pharmaceuticals   Senior Secured First Lien Term Loan (LIBOR + 11.50% Cash,  1.00% PIK, 1.00% LIBOR Floor)(18)   4/28/2019     20,085,144       20,085,144       20,109,849       3.2 %
        384.62 Units of Common Stock (12)   4/28/2019     -       400,000       731,126       0.1 %
                  20,085,144       20,485,144       20,840,975          
                                             
CP OPCO LLC   Services:  Consumer   Senior Secured First Lien Term Loan (LIBOR + 6.75% Cash, 1.00% LIBOR Floor)(18)   9/30/2020     17,000,000       17,000,000       17,000,000       2.7 %
                  17,000,000       17,000,000       17,000,000          
                                             
ContMid Intermediate Inc.(11)   Automotive   Senior Secured Second Lien Term Loan (LIBOR + 9.00% Cash, 1.00% LIBOR Floor)(17)   10/25/2019     15,000,000       15,000,000       14,811,049       2.4 %
                  15,000,000       15,000,000       14,811,049          
                                             
ConvergeOne Holdings Corporation   Telecommunications   Senior Secured Second Lien Term Loan (LIBOR + 8.00% Cash, 1.00% LIBOR Floor)(18)   6/17/2021     12,500,000       12,391,902       12,320,250       2.0 %
                  12,500,000       12,391,902       12,320,250          

 

F-16

 

 

Company (1)   Industry   Type of Investment   Maturity   Par Amount (2)     Cost(3)     Fair Value     % of
 Net Assets (4)
 
                                     
Crow Precision Components LLC   Aerospace & Defense   Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(17)   9/30/2019     14,000,000       14,000,000       13,998,510       2.3 %
        250 units of outstanding equity in Wingman Holdings, Inc.   9/30/2019     -       500,000       589,147       0.1 %
                  14,000,000       14,500,000       14,587,657          
                                             
DHISCO Electronic Distribution, Inc. (7)(11)   Hotel, Gaming & Leisure   Senior Secured First Lien Term Loan A (LIBOR + 9.00%, 1.50% LIBOR Floor)   11/10/2019     31,238,095       31,238,095       31,479,253       5.1 %
                                             
        Senior Secured First Lien Term Loan B (10.50% PIK)   2/10/2018     6,278,067       6,278,067       6,301,164       1.0 %
                                             
        Revolving Credit Facility (LIBOR + 9.00%, 1.50% LIBOR Floor)(23)   5/10/2017     -       -       -       0.0 %
        Equity - 1,230,769 Units(21)   2/10/2018     -       1,230,769       2,378,890       0.4 %
                  37,516,162       38,746,931       40,159,307          
                                             
DLR Restaurants LLC (11)   Hotel, Gaming & Leisure   Senior Secured First Lien Term Loan (11.00% Cash, 2.50% PIK)   4/18/2018     23,512,686       23,512,686       23,226,501       3.7 %
        Unsecured Debt (12.00% Cash, 4.00% PIK)   4/18/2018     276,092       276,092       272,037       0.0 %
                  23,788,778       23,788,778       23,498,538          
                                             
Dream Finders Homes, LLC (9)(27)   Construction & Building   Senior Secured First Lien Term Loan B (LIBOR + 14.50% Cash)   10/1/2018     14,091,194       13,971,357       14,140,514       2.3 %
        5,000 units of outstanding equity   10/1/2018     -       180,000       1,929,761       0.3 %
                  14,091,194       14,151,357       16,070,275          
                                             
Dynamic Energy Services International LLC   Energy:  Oil & Gas   Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(17)   3/6/2018     17,575,000       17,575,000       17,042,829       2.7 %
                  17,575,000       17,575,000       17,042,829          
                                             
Essex Crane Rental Corp. (11)   Construction & Building   Senior Secured First Lien Term Loan (LIBOR + 12.50% Cash, 1.00% LIBOR Floor)(18)   5/13/2019     20,000,000       20,000,000       19,325,800       3.1 %
                  20,000,000       20,000,000       19,325,800          
                                             
FKI Security Group LLC (11)   Capital Equipment   Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(18)   3/30/2020     14,906,250       14,906,250       14,616,174       2.4 %
                  14,906,250       14,906,250       14,616,174          
                                             
Footprint Acquisition LLC   Services:  Business   Senior Secured First Lien Term Loan (LIBOR + 8.00% Cash)(17)   2/27/2020     5,250,102       5,250,103       5,151,828       0.8 %
        Preferred Equity  (8.75% PIK)   2/27/2020     5,151,581       5,151,581       4,652,001       0.8 %
        150.0 units of Common Stock(22)   2/27/2020     -       -       -       0.0 %
                  10,401,683       10,401,684       9,803,829          

 

F-17

 

 

Company (1)   Industry   Type of Investment   Maturity   Par Amount (2)     Cost(3)     Fair Value     % of
 Net Assets (4)
 
                                     
Freedom Powersports LLC(7)(9)   Automotive   Senior Secured First Lien Term Loan (LIBOR + 11.50% Cash, 1.50% LIBOR Floor)(18)   9/26/2019     10,200,000       10,200,000       10,268,663       1.7 %
        Senior Secured First Lien Delayed Draw (LIBOR + 11.50% Cash, 1.50% LIBOR Floor)   9/26/2019     3,000,000       3,000,000       3,032,312       0.5 %
                  13,200,000       13,200,000       13,300,975          
                                             
Harrison Gypsum LLC (11)   Metals & Mining   Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 0.50% PIK, 1.50% LIBOR Floor)(17)   12/21/2018     56,134,983       56,134,983       55,225,035       8.9 %
                  56,134,983       56,134,983       55,225,035          
                                             
Heligear Acquisition Co.   Aerospace & Defense   Senior Secured First Lien Note (10.25% Cash)   10/15/2019     20,000,000       20,000,000       20,523,479       3.3 %
                  20,000,000       20,000,000       20,523,479          
                                             
Help/Systems LLC   Services:  Business   Senior Secured Second Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)(17)   6/28/2020     15,000,000       15,000,000       15,150,000       2.5 %
                  15,000,000       15,000,000       15,150,000          

  

F-18

 

 

Company (1)   Industry   Type of Investment   Maturity   Par Amount (2)     Cost(3)     Fair Value     % of
 Net Assets (4)
 
                                     
JD Norman Industries, Inc.   Automotive   Senior Secured First Lien Term Loan (LIBOR + 10.25% Cash)(17)   3/6/2019     22,500,000       22,500,000       22,183,434       3.6 %
                  22,500,000       22,500,000       22,183,434          
                                             
Jordan Reses Supply Company, LLC(27)   Healthcare & Pharmaceuticals   Senior Secured Second Lien Term Loan (LIBOR + 11.00%, 1.00% LIBOR Floor)   4/24/2020     20,000,000       20,000,000       20,349,811       3.3 %
                  20,000,000       20,000,000       20,349,811          
                                             
Lighting Science Group Corporation   Containers, Packaging & Glass   Senior Secured Second Lien Term
(LIBOR + 10.00% Cash, 2.00% PIK)(18)
  2/19/2019     15,730,619       15,014,318       15,055,776       2.4 %
        Warrants to purchase 2.36% of the outstanding equity   2/19/2019     -       955,680       353,080       0.1 %
                  15,730,619       15,969,998       15,408,856          
                                             
Lucky Strike Entertainment, L.L.C.   Hotel, Gaming & Leisure   Senior Secured Second Lien Term Loan (LIBOR + 11.00% Cash, 1.00% LIBOR Floor, 2.00% PIK)(18)   12/24/2019     10,254,472       10,254,472       10,163,515       1.6 %
                  10,254,472       10,254,472       10,163,515          
                                             
Lydell Jewelry Design Studio, LLC (11)(27)   Consumer goods: Non-durable   Senior Secured First Lien Term Loan (LIBOR + 5.50% Cash, 7.50% PIK, 1.50% LIBOR Floor)(17)   9/13/2018     14,436,386       14,195,568       11,888,075       1.9
        Warrants to purchase 13.3% of the outstanding membership units   9/13/2018     -       -       -       0.0 %
                  14,436,386       14,195,568       11,888,075          
                                             
Merchant Cash and Capital, LLC (9)(27)   Banking, Finance, Insurance & Real Estate   Senior Secured First Lien Delayed Draw (LIBOR + 8.00% Cash, 3.00% LIBOR Floor)(17)   3/4/2016     17,500,000       17,500,000       17,547,775       2.8 %
        Senior Secured Second Lien Term Loan (12.00% Cash)   8/19/2016     15,000,000       15,000,000       14,978,850       2.4 %
                  32,500,000       32,500,000       32,526,625          

 

F-19

 

 

Company (1)   Industry   Type of Investment   Maturity   Par Amount (2)     Cost(3)     Fair Value     % of
 Net Assets (4)
 
                                     
Meridian Behavioral Health LLC (7)(9)   Healthcare & Pharmaceuticals   Senior Secured First Lien Term Loan A (LIBOR + 11.50%, 2.50% LIBOR Floor)(18)   11/14/2016     10,289,141       10,122,094       10,289,141       1.7 %
        Senior Secured First Lien Term Loan B (LIBOR + 11.50%, 2.50% LIBOR Floor)(18)   11/14/2016     6,600,000       6,600,000       6,600,000       1.1 %
        Warrants to purchase 8% of the outstanding equity   11/14/2016     -       536,296       5,431,566       0.9 %
                  16,889,141       17,258,390       22,320,707