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EX-32.1 - EXHIBIT 32.1 - Sierra Income Corpsic-ex321x033118.htm
EX-31.2 - EXHIBIT 31.2 - Sierra Income Corpsic-ex312x0331x18.htm
EX-31.1 - EXHIBIT 31.1 - Sierra Income Corpsic-ex311x033118.htm
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
_____________________________________________________
Form 10-Q
 ____________________________________________________
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31, 2018
or
o
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: 814-00924
 _____________________________________________________
Sierra Income Corporation
(Exact Name of Registrant as Specified in its Charter)
 _____________________________________________________
Maryland
 
45-2544432
(State or Other Jurisdiction of
Incorporation or Organization)
 
(I.R.S. Employer
Identification No.)
280 Park Avenue, 6th Floor East, New York, NY 10017
(Address of Principal Executive Offices)
(212) 759-0777
(Registrant’s Telephone Number, Including Area Code)
  ___________________________________________________

(Former name, former address and former fiscal year, if changed since last report)
_____________________________________________________ 

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 Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     Yes  o    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act:
Large accelerated filer
o
 
Accelerated filer
o
Non-accelerated filer (Do not check if a smaller reporting company)
x
 
Smaller reporting company
o
Emerging growth company
o
 
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

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  o    No  x

As of May 7, 2018, the Registrant had 97,888,267 shares of common stock, $0.001 par value, outstanding.
 
 
 
 
 



TABLE OF CONTENTS
 
Part I. Financial Information
 
Part II. Other Information
 





Sierra Income Corporation
Consolidated Statements of Assets and Liabilities
 
 
March 31, 2018
 
December 31, 2017
ASSETS
 
(unaudited)
 
 
Investments at fair value
 
 
 
 
Non-controlled/non-affiliated investments (amortized cost of $920,184,577 and $975,968,734, respectively)
 
$
885,103,021

 
$
917,820,822

Controlled/affiliated investments (amortized cost of $172,036,556 and $153,660,073, respectively)
 
156,796,629

 
146,288,268

Investments at fair value
 
1,041,899,650

 
1,064,109,090

Cash and cash equivalents
 
44,690,925

 
64,909,759

Cash collateral on total return swap (Note 5)
 
44,000,000

 
48,000,000

Interest receivable from non-controlled/non-affiliated investments
 
9,205,453

 
9,039,243

Unsettled trades receivable
 
575,904

 
339,573

Receivable due on total return swap (Note 5)
 
492,241

 
462,555

Interest receivable from controlled/affiliated investments
 
270,325

 
638,458

Prepaid expenses and other assets
 
132,016

 
219,096

Receivable for Company shares sold
 
40,000

 
235,060

Total assets
 
$
1,141,306,514

 
$
1,187,952,834

 
 
 
 
 
LIABILITIES
 
 
 
 
Revolving credit facilities payable (net of deferred financing costs of $4,836,823 and $5,286,927, respectively) (Note 6)
 
$
398,163,177

 
$
429,713,073

Base management fees payable (Note 7)
 
5,003,816

 
5,196,997

Unrealized depreciation on total return swap (Note 5)
 
2,413,500

 
5,354,868

Interest payable
 
1,677,163

 
1,822,523

Accounts payable and accrued expenses
 
1,599,535

 
1,755,968

Administrator fees payable (Note 7)
 
723,535

 
695,777

Unsettled trades payable
 
723,188

 
308,233

Deferred tax liability
 
155,999

 
291,454

Payable for Company shares redeemed
 
4,738

 

Incentive fees payable (Note 7)
 

 
2,827,372

Total liabilities
 
$
410,464,651

 
$
447,966,265

 
 
 
 
 
Commitments (Note 11)
 
 
 
 
 
 
 
 
 
NET ASSETS
 
 
 
 
Common shares, par value $0.001 per share, 250,000,000 common shares authorized, 97,578,798
and 96,620,231 common shares issued and outstanding, respectively
 
$
97,579

 
$
96,620

Capital in excess of par value
 
850,980,124

 
843,592,066

Accumulated distribution in excess of net realized gain/(loss) from investments and total return swap
 
(80,104,530
)
 
(49,402,054
)
Accumulated undistributed net investment income
 
12,673,072

 
16,779,377

Net unrealized depreciation on investments and total return swap, net of provision for taxes of $69,399
and ($204,855), respectively
 
(52,804,382
)
 
(71,079,440
)
Total net assets
 
730,841,863

 
739,986,569

Total liabilities and net assets
 
$
1,141,306,514

 
$
1,187,952,834

 
 
 
 
 
NET ASSET VALUE PER COMMON SHARE
 
$
7.49

 
$
7.66

See accompanying notes to consolidated financial statements.

F-1


Sierra Income Corporation
Consolidated Statements of Operations
 
 
Three Months Ended March 31,
 
 
2018
 
2017
INVESTMENT INCOME
 
(unaudited)
 
(unaudited)
Interest and dividends from investments
 
 
 
 
Non-controlled/non-affiliated investments:
 
 
 
 
Cash
 
$
19,826,763

 
$
19,715,289

Payment-in-kind
 
1,126,608

 
1,815,049

Controlled/affiliated investments:
 
 
 
 
Cash
 
2,202,123

 
2,432,801

Payment-in-kind
 
536,818

 
64,598

Total interest and dividend income
 
23,692,312

 
24,027,737

Fee income (Note 12)
 
644,675

 
2,190,200

Interest from cash and cash equivalents
 
23,053

 
12,654

Total investment income
 
24,360,040

 
26,230,591

EXPENSES
 
 
 
 
Interest and financing expenses
 
5,172,430

 
3,944,084

Base management fees (Note 7)
 
5,003,816

 
5,208,569

General and administrative expenses
 
1,425,118

 
882,129

Administrator expenses (Note 7)
 
723,535

 
793,529

Professional fees
 
337,546

 
586,043

Offering costs
 
283,250

 
521,684

Incentive fees (Note 7)
 

 
548,806

Total expenses
 
12,945,695

 
12,484,844

NET INVESTMENT INCOME
 
11,414,345

 
13,745,747

REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS
 
 
 
 
Net realized gain/(loss) from non-controlled/non-affiliated investments
 
(32,181,098
)
 
(13,194,328
)
Net realized gain/(loss) on total return swap (Note 5)
 
1,478,622

 
2,719,351

Net change in unrealized appreciation/(depreciation) on non-controlled/non-affiliated investments
 
23,066,356

 
6,716,199

Net change in unrealized appreciation/(depreciation) on controlled/affiliated investments
 
(7,868,122
)
 
(1,116,075
)
Net change in unrealized appreciation/(depreciation) on total return swap (Note 5)
 
2,941,369

 
(104,356
)
Change in provision for deferred taxes on unrealized appreciation/(depreciation) on investments
 
135,455

 
(297,572
)
Net realized and unrealized gain/(loss) on investments
 
(12,427,418
)
 
(5,276,781
)
NET INCREASE/(DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS
 
$
(1,013,073
)
 
$
8,468,966

WEIGHTED AVERAGE - BASIC AND DILUTED EARNINGS PER COMMON SHARE
 
$
(0.01
)
 
$
0.09

WEIGHTED AVERAGE - BASIC AND DILUTED NET INVESTMENT INCOME PER COMMON SHARE
 
$
0.12

 
$
0.14

WEIGHTED AVERAGE COMMON STOCK OUTSTANDING - BASIC AND DILUTED (NOTE 10)
 
96,993,237

 
95,382,267

DISTRIBUTIONS DECLARED PER COMMON SHARE
 
$
0.16

 
$
0.16

See accompanying notes to the consolidated financial statements.

F-2


Sierra Income Corporation
Consolidated Statements of Changes in Net Assets
 
Three Months Ended March 31,
 
2018
 
2017
INCREASE/(DECREASE) FROM OPERATIONS
(unaudited)
 
(unaudited)
Net investment income
$
11,414,345

 
$
13,745,747

Net realized gain/(loss) on investments
(32,181,098
)
 
(13,194,328
)
Net realized gain/(loss) on total return swap (Note 5)
1,478,622

 
2,719,351

Net change in unrealized appreciation/(depreciation) on investments
15,198,234

 
5,600,124

Net change in unrealized appreciation/(depreciation) on total return swap (Note 5)
2,941,369

 
(104,356
)
Change in provision for deferred taxes on unrealized appreciation/(depreciation) on investments
135,455

 
(297,572
)
Net increase/(decrease) in net assets resulting from operations
(1,013,073
)
 
8,468,966

SHAREHOLDER DISTRIBUTIONS (Note 2)
 
 
 
Distributions from net investment income
(15,520,650
)
 
(15,267,181
)
Distributions from return of capital

 

Distributions from net realized gains

 

Net decrease in net assets from shareholder distributions
(15,520,650
)
 
(15,267,181
)
COMMON SHARE TRANSACTIONS
 
 
 
Issuance of common shares, net of underwriting costs
1,448,175

 
6,071,081

Issuance of common shares pursuant to distribution reinvestment plan
6,667,713

 
7,085,971

Repurchase of common shares
(726,871
)
 
(128,670
)
Net increase in net assets resulting from common share transactions
7,389,017

 
13,028,382

Total increase/(decrease) in net assets
(9,144,706
)
 
6,230,167

Net assets at beginning of period
739,986,569

 
773,113,087

Net assets at end of period(1)
$
730,841,863

 
$
779,343,254

 
 
 
 
Net asset value per common share
$
7.49

 
$
8.10

Common shares outstanding, beginning of period
96,620,231

 
94,666,418

Issuance of common shares
187,755

 
743,698

Issuance of common shares pursuant to distribution reinvestment plan
865,704

 
871,436

Repurchase of common shares
(94,892
)
 
(15,755
)
Common shares outstanding, end of period
97,578,798

 
96,265,797


(1)
Net assets at end of period include accumulated undistributed net investment income of $12,673,072 and $18,235,306 as of March 31, 2018 and 2017, respectively.

See accompanying notes to consolidated financial statements.

F-3


Sierra Income Corporation
Consolidated Statements of Cash Flows
 
 
Three Months Ended March 31,
 
 
2018
 
2017
 
 
(unaudited)
 
(unaudited)
Cash flows from operating activities
 
 
 
 
NET INCREASE/(DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS:
 
$
(1,013,073
)
 
$
8,468,966

ADJUSTMENT TO RECONCILE NET INCREASE/(DECREASE) IN NET ASSETS
FROM OPERATIONS TO NET CASH USED IN OPERATING ACTIVITIES:
 
 
 
 
Payment-in-kind interest income
 
(1,663,426
)
 
(1,879,647
)
Net amortization of premium on investments
 
(582,738
)
 
(305,936
)
Amortization of deferred financing costs
 
468,855

 
347,220

Net realized (gain)/loss on investments
 
32,181,098

 
13,194,328

Net change in unrealized (appreciation)/depreciation on investments
 
(15,198,234
)
 
(5,600,124
)
Net change in unrealized (appreciation)/depreciation on total return swap (Note 5)
 
(2,941,368
)
 
104,356

Purchases and originations
 
(68,641,471
)
 
(100,087,565
)
Proceeds from sale of investments and principal repayments
 
76,114,211

 
45,773,310

(Increase)/decrease in operating assets:
 
 
 
 
Unsettled trades receivable
 
(236,331
)
 
(9,327,086
)
Due from affiliate (Note 7)
 

 
1,250,000

Interest receivable from non-controlled/non-affiliated investments
 
(166,210
)
 
1,901,126

Interest receivable from controlled/affiliated investments
 
368,133

 
532,961

Receivable for Company shares sold
 
195,060

 
107,123

Receivable due on total return swap (Note 5)
 
(29,686
)
 
121,642

Prepaid expenses and other assets
 
87,080

 
9,016

Increase/(decrease) in operating liabilities:
 
 
 
 
Unsettled trades payable
 
414,955

 
1,373,273

Management fee payable
 
(193,181
)
 
70,462

Accounts payable and accrued expenses
 
(156,433
)
 
(411,891
)
Incentive fees payable
 
(2,827,372
)
 
(856,614
)
Administrator fees payable
 
27,758

 
(57,149
)
Interest payable
 
(145,360
)
 
(404,358
)
Deferred tax liability
 
(135,455
)
 
297,572

Due to affiliate (Note 7)
 

 
(135,784
)
NET CASH PROVIDED BY/(USED IN) OPERATING ACTIVITIES
 
15,926,812

 
(45,514,799
)
Cash flows from financing activities:
 
 
 
 
Borrowings under revolving credit facility
 
17,000,000

 
60,000,000

Repayments of revolving credit facility
 
(49,000,000
)
 
(50,000,000
)
Proceeds from issuance of common stock, net of underwriting costs
 
1,448,175

 
6,071,081

Payment of cash distributions
 
(8,852,937
)
 
(8,181,210
)
Financing costs paid
 
(18,751
)
 
(18,750
)
Repurchase of common shares
 
(722,133
)
 
(128,670
)
NET CASH PROVIDED BY/(USED IN) FINANCING ACTIVITIES
 
(40,145,646
)
 
7,742,451

TOTAL INCREASE/(DECREASE) IN CASH
 
(24,218,834
)
 
(37,772,348
)
CASH AND CASH COLLATERAL ON TOTAL RETURN SWAP AT BEGINNING OF PERIOD
 
112,909,759

 
179,021,736

CASH AND CASH COLLATERAL ON TOTAL RETURN SWAP AT END OF PERIOD(1)
 
$
88,690,925

 
$
141,249,388

Supplemental Information:
 
 
 
 
Cash paid during the period for interest
 
$
4,848,935

 
$
4,001,222

Supplemental non-cash information:
 
 
 
 
Non-cash purchase of investments
 
$
9,667,649

 
$
13,231,240

Non-cash sale of investments
 
9,667,649

 
13,231,240

Payment-in-kind interest income
 
536,818

 
1,879,647

Amortization of deferred financing costs
 
582,738

 
347,220

Net amortization of premium on investments
 
704,330

 
305,939

Issuance of common shares in connection with distribution reinvestment plan
 
$
6,667,713

 
$
7,085,971

(1)
Includes cash and cash equivalents of $44,690,925 and $52,449,338 and cash collateral on total return swap of $44,000,000 and $48,000,000 as of March 31, 2018 and 2017, respectively.
See accompanying notes to consolidated financial statements.

F-4


Sierra Income Corporation
Consolidated Schedule of Investments
As of March 31, 2018
(unaudited)

Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
Non-controlled/non-affiliated investments – 121.1%
 
 
 
 
 
 
 
$
739,986,569

AAAHI Acquisition Corporation
 
Transportation: Consumer
 
Senior Secured First Lien Term Loan LIBOR + 7.000%, 1.000% Floor (4)(5)
 
12/15/2021
 
$
7,052,863

 
$
7,052,862

 
$
7,052,862

 
1.0%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 7.000%, 1.000% Floor (4)(5)(6)
 
12/14/2018
 
1,600,916

 
1,600,916

 
1,600,916

 
0.2%
 
 
 
 
 
 
 
 
8,653,779

 
8,653,778

 
8,653,778

 
 
Alpha Media LLC
 
Media: Broadcasting & Subscription
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (7)
 
2/25/2022
 
6,019,898

 
5,830,091

 
5,777,296

 
0.8%
 
 
 
 
 
 
 
 
6,019,898

 
5,830,091

 
5,777,296

 
 
 Alpine SG, LLC
 
 High Tech Industries
 
Senior Secured First Lien Term Loan LIBOR + 6.500%, 1.000% Floor (4)(5)(6)
 
11/16/2022
 
6,643,350

 
6,643,350

 
6,643,350

 
0.9%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 6.500%, 1.000% Floor (4)(5)
 
11/16/2022
 
13,466,250

 
13,466,250

 
13,466,250

 
1.8%
 
 
 
 
 
 
 
 
20,109,600

 
20,109,600

 
20,109,600

 
 
American Dental Partners, Inc.
 
Healthcare & Pharmaceuticals
 
Senior Secured Second Lien Term Loan LIBOR + 8.500%, 1.000% Floor (4)(5)
 
9/25/2023
 
7,250,000

 
7,250,000

 
7,322,500

 
1.0%
 
 
 
 
 
 
 
 
7,250,000

 
7,250,000

 
7,322,500

 
 
Amerijet Holdings, Inc.
 
Transportation: Cargo
 
Senior Secured First Lien Term Loan LIBOR + 8.000%, 1.000% Floor (5)(7)
 
7/15/2021
 
12,133,454

 
12,133,454

 
12,376,123

 
1.7%
 
 
 
 
 
 
 
 
12,133,454

 
12,133,454

 
12,376,123

 
 
AMMC CLO 22, Limited Series 2018-22A
 
Multi-Sector Holdings
 
Subordinated Notes 15.238% effective yield (8)(9)(10)
 
4/25/2031
 
7,222,000

 
5,885,930

 
5,885,930

 
0.8%
 
 
 
 
 
 
 
 
7,222,000

 
5,885,930

 
5,885,930

 
 
Anaren, Inc.
 
Aerospace & Defense
 
Senior Secured Second Lien Term Loan LIBOR + 8.250%, 1.000% Floor (4)
 
8/18/2021
 
10,000,000

 
9,945,251

 
10,000,000

 
1.4%
 
 
 
 
 
 
 
 
10,000,000

 
9,945,251

 
10,000,000

 
 
Answers Finance, LLC
 
High Tech Industries
 
Senior Secured First Lien Term Loans LIBOR + 5.000%, 1.000% Floor (4)
 
4/15/2021
 
1,285,269

 
1,285,269

 
1,285,269

 
0.2%
 
 
 
 
Senior Secured Second Lien Term Loan Base Rate + 4.500% (11)
 
9/15/2021
 
1,998,547

 
1,998,547

 
1,998,547

 
0.3%
 
 
 
 
Common Stock  - 389,533 shares (12) 
 
 
 

 
5,426,955

 
5,426,195

 
0.7%
 
 
 
 
 
 
 
 
3,283,816

 
8,710,771

 
8,710,011

 
 
APCO Holdings, Inc.
 
Automotive
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (5)(7)
 
1/31/2022
 
4,096,946

 
4,010,796

 
4,096,946

 
0.6%
 
 
 
 
 
 
 
 
4,096,946

 
4,010,796

 
4,096,946

 
 
Apidos CLO XXIV, Series 2016-24A
 
Multi-Sector Holdings
 
Subordinated Notes 8.880% effective yield (5)(8)(9)(10)
 
7/20/2027
 
18,357,647

 
14,592,730

 
15,420,423

 
2.1%
 
 
 
 
 
 
 
 
18,357,647

 
14,592,730

 
15,420,423

 
 
Asurion, LLC
 
Banking, Finance, Insurance & Real Estate
 
Senior Secured Second Lien Term Loan LIBOR + 6.000%, 1.000% Floor (4)(5)
 
8/4/2025
 
5,950,000

 
5,950,000

 
6,069,000

 
0.8%
 
 
 
 
 
 
 
 
5,950,000

 
5,950,000

 
6,069,000

 
 
Aviation Technical Services, Inc.
 
Aerospace & Defense
 
Senior Secured Second Lien Term Loan LIBOR + 8.500%, 1.000% Floor (4)(5)(13)
 
3/31/2022
 
25,000,000

 
25,000,000

 
25,000,000

 
3.4%
 
 
 
 
 
 
 
 
25,000,000

 
25,000,000

 
25,000,000

 
 
Barry's Bootcamp Holdings, LLC
 
Services: Consumer
 
Senior Secured First Lien Term Loan LIBOR + 6.500%, 1.000% Floor (4)(5)(6)
 
7/14/2022
 
8,571,429

 
8,571,429

 
8,571,429

 
1.2%
 
 
 
 
 
 
 
 
8,571,429

 
8,571,429

 
8,571,429

 
 

F-5


Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
Birch Communications Inc.
 
Telecommunications
 
Senior Secured First Lien Term Loan LIBOR + 7.250%, 1.000% Floor (4)(5)
 
7/17/2020
 
12,878,612

 
12,769,162

 
12,758,841

 
1.7%
 
 
 
 
 
 
 
 
12,878,612

 
12,769,162

 
12,758,841

 
 
Black Angus Steakhouses, LLC
 
Hotel, Gaming & Leisure
 
Senior Secured First Lien Term Loan LIBOR + 9.000%, 1.000% Floor (4)\(5)(6)(13)
 
4/24/2020
 
18,995,536

 
18,995,536

 
18,609,192

 
2.5%
 
 
 
 
 
 
 
 
18,995,536

 
18,995,536

 
18,609,192

 
 
Brook & Whittle Holding Corp.
 
Containers, Packaging & Glass
 
Senior Secured First Lien Term Loan LIBOR + 6.250%, 1.000% Floor (4)(5)(6)
 
10/17/2023
 
3,034,180

 
3,034,180

 
3,034,180

 
0.4%
 
 
 
 
 
 
 
 
3,034,180

 
3,034,180

 
3,034,180

 
 
Central States Dermatology Services, LLC
 
Healthcare & Pharmaceuticals
 
Senior Secured First Lien Term Loan LIBOR + 6.500%, 1.000% Floor (5)(6)(7)
 
4/20/2022
 
2,968,424

 
2,968,424

 
2,968,424

 
0.4%
 
 
 
 
 
 
 
 
2,968,424

 
2,968,424

 
2,968,424

 
 
Charming Charlie LLC
 
Retail
 
Senior Secured First Lien Term Loan LIBOR + 1.000%, 1.000% Floor (7)
 
6/8/2018
 
4,869,792

 
2,434,896

 
2,434,896

 
0.3%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 4.500%, 1.000% Floor (7) 
 
6/8/2018
 
2,191,021

 
2,191,021

 
2,191,021

 
0.3%
 
 
 
 
 
 
 
 
7,060,813

 
4,625,917

 
4,625,917

 
 
Covenant Surgical Partners, Inc.
 
Healthcare & Pharmaceuticals
 
Senior Secured First Lien Term Loan LIBOR + 4.750%, 1.000% Floor (4)(5)
 
10/4/2024
 
5,371,154

 
5,358,542

 
5,410,363

 
0.7%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 4.750%, 1.000% Floor (4)(5)(6)
 
10/4/2024
 
834,319

 
830,531

 
846,096

 
0.1%
 
 
 
 
 
 
 
 
6,205,473

 
6,189,073

 
6,256,459

 
 
CP Opco, LLC
 
Services: Consumer
 
Senior Secured First Lien Term Loan Base Rate + 5.500%, PIK (5)(11)(14) 
 
4/1/2019
 
230,542

 
209,514

 
41,290

 
0.0%
 
 
 
 
Senior Secured First Lien Term Loan Base Rate + 8.500%, PIK (5)(11)(14) 
 
4/1/2019
 
1,708,882

 
717,016

 

 
0.0%
 
 
 
 
Preferred Units LIBOR+9.500%, 1.000% Floor, PIK(5)(14)  
 
 
 

 

 

 
0.0%
 
 
 
 
Common Units - 41 units(5)(12)
 
 
 

 

 

 
0.0%
 
 
 
 
 
 
 
 
1,939,424

 
926,530

 
41,290

 
 
CPI International, Inc.
 
Aerospace & Defense
 
Senior Secured Second Lien Term Loan LIBOR + 7.250%, 1.000% Floor (5)(7)
 
7/28/2025
 
9,900,752

 
9,868,780

 
9,829,466

 
1.3%
 
 
 
 
 
 
 
 
9,900,752

 
9,868,780

 
9,829,466

 
 
CSP Technologies North America, LLC
 
Containers, Packaging & Glass
 
Senior Secured First Lien Term Loan LIBOR + 5.250%, 1.000% Floor (4)(5)
 
1/31/2022
 
4,935,936

 
4,935,936

 
4,935,936

 
0.7%
 
 
 
 
 
 
 
 
4,935,936

 
4,935,936

 
4,935,936

 
 
Deliver Buyer, Inc.
 
Services: Business
 
Senior Secured First Lien Term Loan LIBOR + 5.000%, 1.000% Floor (4)
 
5/1/2024
 
3,027,249

 
3,010,466

 
3,027,249

 
0.4%
 
 
 
 
 
 
 
 
3,027,249

 
3,010,466

 
3,027,249

 
 
DHISCO Electronic Distribution, Inc.
 
Hotel, Gaming & Leisure
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 1.500% Floor (5)(7)
 
11/10/2019
 
2,631,735

 
2,631,735

 
2,631,735

 
0.4%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 11.000%, 1.500% Floor, PIK (5)(7)(14) 
 
11/10/2019
 
9,801,998

 
9,207,947

 
1,460,498

 
0.2%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 12.250%, 1.500% Floor, PIK (5)(7)(14) 
 
11/10/2019
 
8,537,086

 
7,257,480

 

 
0.0%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 13.250%, 1.500% Floor, PIK (5)(7)(14) 
 
11/10/2019
 
8,044,135

 
2,940,892

 

 
0.0%
 
 
 
 
Common Units - 769,230 units (5)(12) 
 
 
 

 
769,231

 

 
0.0%

F-6


Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
 
 
 
 
 
 
 
 
29,014,954

 
22,807,285

 
4,092,233

 
 
Drew Marine Partners, LP
 
Transportation: Cargo
 
Senior Secured Second Lien Term Loan LIBOR + 7.000%, 1.000% Floor (7)
 
5/19/2021
 
10,000,000

 
10,045,096

 
10,000,000

 
1.4%
 
 
 
 
 
 
 
 
10,000,000

 
10,045,096

 
10,000,000

 
 
Dryden 38 Senior Loan Fund, Series 2015-38A
 
Multi-Sector Holdings
 
Subordinated Notes 12.114% effective yield (8)(9)(10)
 
7/15/2027
 
7,000,000

 
4,909,709

 
5,090,400

 
0.7%
 
 
 
 
 
 
 
 
7,000,000

 
4,909,709

 
5,090,400

 
 
Dryden 43 Senior Loan Fund, Series 2016-43A
 
Multi-Sector Holdings
 
Subordinated Notes 9.705% effective yield (5)(8)(9)(10)
 
7/20/2029
 
3,620,000

 
2,944,514

 
3,004,600

 
0.4%
 
 
 
 
 
 
 
 
3,620,000

 
2,944,514

 
3,004,600

 
 
Dryden 49 Senior Loan Fund, Series 2017-49A
 
Multi-Sector Holdings
 
Subordinated Notes 13.164% effective yield (5)(9)(10)
 
7/18/2030
 
17,233,288

 
15,334,980

 
15,337,626

 
2.1%
 
 
 
 
 
 
 
 
17,233,288

 
15,334,980

 
15,337,626

 
 
Dynamic Energy Services International LLC
 
Energy: Oil & Gas
 
Senior Secured First Lien Term Loan 13.500% PIK + LIBOR (5)(7)(14) 
 
5/6/2019
 
10,251,945

 
9,874,797

 
6,210,629

 
0.8%
 
 
 
 
 
 
 
 
10,251,945

 
9,874,797

 
6,210,629

 
 
Elite Comfort Solutions LLC
 
Chemicals, Plastics & Rubber
 
Senior Secured First Lien Term Loan LIBOR + 6.500%, 1.000% Floor (4)(6)
 
1/15/2021
 
9,666,845

 
9,666,845

 
9,666,845

 
1.3%
 
 
 
 
 
 
 
 
9,666,845

 
9,666,845

 
9,666,845

 
 
Engineered Machinery Holdings, Inc.
 
Capital Equipment
 
Senior Secured Second Lien Term Loan LIBOR + 7.250%, 1.000% Floor (5)(6)(7)
 
7/18/2025
 
2,735,638

 
2,715,271

 
2,721,960

 
0.4%
 
 
 
 
Senior Secured Second Lien Term Loan LIBOR + 7.250%, 1.000% Floor (5)(6)(7)
 
7/18/2025
 
201,064

 
201,064

 
199,867

 
0.0%
 
 
 
 
 
 
 
 
2,936,702

 
2,916,335

 
2,921,827

 
 
First Boston Construction Holdings, LLC
 
Banking, Finance, Insurance & Real Estate
 
Senior secured first lien notes 12.000% (5)(6)
 
12/31/2020
 
7,937,000

 
7,937,000

 
7,937,000

 
1.1%
 
 
 
 
Preferred Equity - 1,646,250 units (5)(6)(12)
 
 
 

 
1,984,250

 
1,984,250

 
0.3%
 
 
 
 
 
 
 
 
7,937,000

 
9,921,250

 
9,921,250

 
 
FKI Security Group, LLC
 
Capital Equipment
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 1.000% Floor (4)(5)
 
3/30/2020
 
11,468,750

 
11,468,750

 
11,468,750

 
1.5%
 
 
 
 
 
 
 
 
11,468,750

 
11,468,750

 
11,468,750

 
 
Friedrich Holdings, Inc.
 
Construction & Building
 
Senior Secured First Lien Term Loan LIBOR + 7.000%, 1.000% Floor (5)(7)
 
2/7/2023
 
13,737,717

 
13,737,717

 
13,875,094

 
1.9%
 
 
 
 
 
 
 
 
13,737,717

 
13,737,717

 
13,875,094

 
 
GK Holdings, Inc.
 
Services: Business
 
Senior Secured Second Lien Term Loan LIBOR + 10.250%, 1.000% Floor (4)
 
1/20/2022
 
10,000,000

 
10,000,000

 
9,752,000

 
1.3%
 
 
 
 
 
 
 
 
10,000,000

 
10,000,000

 
9,752,000

 
 
Golden West Packaging Group LLC
 
Forest Products & Paper
 
Senior Secured First Lien Term Loan LIBOR + 5.250%, 1.000% Floor (5)(7)
 
6/20/2023
 
3,800,427

 
3,800,427

 
3,800,427

 
0.5%
 
 
 
 
 
 
 
 
3,800,427

 
3,800,427

 
3,800,427

 
 
Green Field Energy Services, Inc.
 
Energy: Oil & Gas
 
Senior Secured First Lien Notes 13.000% (5)(8)(14)
 
11/15/2016
 
766,616

 
754,615

 
122,658

 
0.0%
 
 
 
 
Warrants - 0.00% of outstanding equity (5)(12)
 
 
 

 
29,000

 

 
0.0%
 
 
 
 
 
 
 
 
766,616

 
783,615

 
122,658

 
 
HBC Holdings LLC
 
Wholesale
 
Senior Secured First Lien Term Loan LIBOR + 6.500%, 1.000% Floor (5)(7)
 
3/30/2020
 
12,037,500

 
12,037,500

 
11,846,104

 
1.6%
 
 
 
 
 
 
 
 
12,037,500

 
12,037,500

 
11,846,104

 
 
Heligear Acquisition Co.
 
Aerospace & Defense
 
Senior secured first lien notes 10.250% (5)(8)
 
10/15/2019
 
15,000,000

 
15,000,000

 
15,219,000

 
2.1%
 
 
 
 
 
 
 
 
15,000,000

 
15,000,000

 
15,219,000

 
 
High Ridge Brands Co.
 
Consumer Goods: Non-Durable
 
Senior secured first lien notes 8.875% (5)(8)(15)
 
3/15/2025
 
2,000,000

 
2,000,000

 
1,790,400

 
0.2%
 
 
 
 
 
 
 
 
2,000,000

 
2,000,000

 
1,790,400

 
 

F-7


Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
Holland Acquisition Corp.
 
Energy: Oil & Gas
 
Senior Secured First Lien Term Loan LIBOR + 9.000%, 1.000% Floor (4)
 
5/29/2018
 
4,515,605

 
4,509,595

 
3,216,465

 
0.4%
 
 
 
 
 
 
 
 
4,515,605

 
4,509,595

 
3,216,465

 
 
Hylan Datacom & Electrical LLC
 
Construction & Building
 
Senior Secured First Lien Term Loan LIBOR + 7.500%, 1.000% Floor (5)(7)
 
7/25/2021
 
14,861,780

 
14,861,780

 
15,096,596

 
2.0%
 
 
 
 
 
 
 
 
14,861,780

 
14,861,780

 
15,096,596

 
 
IHS Intermediate, Inc.
 
Services: Business
 
Senior Secured Second Lien Term Loan LIBOR + 8.250%, 1.000% Floor (4)
 
7/20/2022
 
25,000,000

 
25,000,000

 
25,000,000

 
3.4%
 
 
 
 
 
 
 
 
25,000,000

 
25,000,000

 
25,000,000

 
 
Imagine! Print Solutions, LLC
 
Media: Advertising, Printing & Publishing
 
Senior Secured Second Lien Term Loan LIBOR + 8.750%, 1.000% Floor (4)(5)(16)
 
6/21/2023
 
8,950,000

 
8,832,414

 
8,502,500

 
1.1%
 
 
 
 
 
 
 
 
8,950,000

 
8,832,414

 
8,502,500

 
 
Impact Sales, LLC
 
Services: Business
 
Senior Secured First Lien Term Loan LIBOR + 7.000%, 1.000% Floor (4)(5)(6)
 
12/30/2021
 
4,841,602

 
4,841,602

 
4,708,533

 
0.6%
 
 
 
 
 
 
 
 
4,841,602

 
4,841,602

 
4,708,533

 
 
Interflex Acquisition Company, LLC
 
Containers, Packaging & Glass
 
Senior Secured First Lien Term Loan LIBOR + 8.000%, 1.000% Floor (5)(7)
 
8/18/2022
 
13,956,250

 
13,956,250

 
13,667,356

 
1.8%
 
 
 
 
 
 
 
 
13,956,250

 
13,956,250

 
13,667,356

 
 
Invision Diversified, LLC
 
Services: Business
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 1.000% Floor (4)(5)(13)
 
6/30/2020
 
23,710,185

 
23,710,185

 
23,947,287

 
3.2%
 
 
 
 
 
 
 
 
23,710,185

 
23,710,185

 
23,947,287

 
 
IOP Monroe Acquisition, Inc.
 
Capital Equipment
 
Senior Secured First Lien Term Loan LIBOR + 5.500%, 1.000% Floor (5)(6)(7)
 
4/1/2022
 
962,500

 
962,500

 
962,500

 
0.1%
 
 
 
 
 
 
 
 
962,500

 
962,500

 
962,500

 
 
Isola USA Corp.
 
High Tech Industries
 
Senior Secured First Lien Term Loan LIBOR + 10.750%, 1.000% Floor (4)(6)
 
1/2/2023
 
113,828

 
113,828

 
113,828

 
0.0%
 
 
 
 
Senior Secured Second Lien Term Loan LIBOR + 9.500%, 1.000% Floor, PIK (4) 
 
1/2/2023
 
9,936,137

 
6,177,993

 
6,036,203

 
0.8%
 
 
 
 
Common Units - 10,283,782 units(12)
 
 
 

 

 

 
0.0%
 
 
 
 
 
 
 
 
10,049,965

 
6,291,821

 
6,150,031

 
 
JFL-WCS Partners, LLC
 
Environmental Industries
 
Preferred Units - 618,876 6.000%, PIK (5)
 
 
 

 
618,876

 
618,876

 
0.1%
 
 
 
 
Common Units - 66,764 (5)(12)
 
 
 

 
68,764

 
68,764

 
0.0%
 
 
 
 
 
 
 
 

 
687,640

 
687,640

 
 
Keystone Acquisition Corp.
 
Healthcare & Pharmaceuticals
 
Senior Secured Second Lien Term Loan LIBOR + 9.250%, 1.000% Floor (4)(5)(16)
 
5/1/2025
 
7,000,000

 
6,874,626

 
6,898,500

 
0.9%
 
 
 
 
 
 
 
 
7,000,000

 
6,874,626

 
6,898,500

 
 
L&S Plumbing Partnership, Ltd.
 
Construction & Building
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 1.000% Floor (4)(5)
 
2/15/2022
 
11,318,444

 
11,318,444

 
11,462,188

 
1.5%
 
 
 
 
 
 
 
 
11,318,444

 
11,318,444

 
11,462,188

 
 
Livingston International Inc.
 
Transportation: Cargo
 
Senior Secured Second Lien Term Loan LIBOR + 8.250%, 1.250% Floor (4)(9)
 
4/17/2020
 
4,613,287

 
4,491,977

 
4,486,883

 
0.6%
 
 
 
 
 
 
 
 
4,613,287

 
4,491,977

 
4,486,883

 
 
LTCG Holdings Corp.
 
Banking, Finance, Insurance & Real Estate
 
Senior Secured First Lien Term Loan LIBOR + 5.000%, 1.000% Floor (4)
 
6/6/2020
 
2,838,571

 
2,832,695

 
2,823,527

 
0.4%
 
 
 
 
 
 
 
 
2,838,571

 
2,832,695

 
2,823,527

 
 
Magnetite XIX, Limited
 
Multi-Sector Holdings
 
Subordinated Notes LIBOR + 7.610% (4)(8)(9)(10)
 
7/17/2030
 
2,000,000

 
1,875,000

 
1,910,400

 
0.3%
 
 
 
 
Subordinated Notes 10.518% effective yield (5)(8)(9)(10)
 
7/17/2030
 
13,730,209

 
11,950,248

 
11,061,056

 
1.5%
 
 
 
 
 
 
 
 
15,730,209

 
13,825,248

 
12,971,456

 
 

F-8


Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
Manna Pro Products, LLC
 
Consumer Goods: Non-durable
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (4)(5)(6)
 
12/8/2023
 
4,156,250

 
4,156,250

 
4,156,250

 
 
 
 
 
 
 
 
 
 
4,156,250

 
4,156,250

 
4,156,250

 
 
Nathan's Famous, Inc.
 
Beverage & Food
 
Senior secured first lien notes 6.625% (5)(8)(9)(15)
 
11/1/2025
 
4,950,000

 
4,966,622

 
4,974,750

 
0.7%
 
 
 
 
 
 
 
 
4,950,000

 
4,966,622

 
4,974,750

 
 
New Media Holdings II LLC
 
Media: Advertising, Printing & Publishing
 
Senior Secured First Lien Term Loan LIBOR + 6.250%, 1.000% Floor (4)(5)(16)
 
7/14/2022
 
13,836,440

 
13,827,676

 
13,836,440

 
1.9%
 
 
 
 
 
 
 
 
13,836,440

 
13,827,676

 
13,836,440

 
 
Novetta Solutions, LLC
 
High Tech Industries
 
Senior Secured Second Lien Term Loan LIBOR + 8.500%, 1.000% Floor (4)
 
10/16/2023
 
11,000,000

 
10,918,178

 
10,225,600

 
1.4%
 
 
 
 
 
 
 
 
11,000,000

 
10,918,178

 
10,225,600

 
 
Nuspire, LLC
 
High Tech Industries
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (5)(6)(7)
 
11/8/2022
 
6,294,225

 
6,294,225

 
6,294,225

 
0.9%
 
 
 
 
 
 
 
 
6,294,225

 
6,294,225

 
6,294,225

 
 
Oxford Mining Company, LLC
 
Metals & Mining
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 0.750% Floor, 3.000% PIK (4)(5)(14) 
 
12/31/2018
 
12,498,735

 
12,088,065

 
9,027,836

 
1.2%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 0.750% Floor, 3.000% PIK (4)(5)(14)
 
12/31/2018
 
8,817,164

 
8,526,660

 
6,368,637

 
0.9%
 
 
 
 
 
 
 
 
21,315,899

 
20,614,725

 
15,396,473

 
 
Path Medical, LLC
 
Healthcare & Pharmaceuticals
 
Senior Secured First Lien Term Loan LIBOR + 9.500%, 1.000% Floor (4)(5)
 
10/11/2021
 
14,610,737

 
14,166,571

 
14,623,887

 
2.0%
 
 
 
 
Warrants - 2.09%  of outstanding equity  (5)(12)
 
 
 

 
669,709

 
111,251

 
0.0%
 
 
 
 
 
 
 
 
14,610,737

 
14,836,280

 
14,735,138

 
 
Payless Holdings LLC
 
Retail
 
Common Stock - 37,126 shares (12) 
 
 
 

 
543,120

 
543,153

 
0.1%
 
 
 
 
 
 
 
 

 
543,120

 
543,153

 
 
Petco Animal Supplies, Inc.
 
Retail
 
Senior Secured First Lien Term Loan LIBOR + 3.000%, 1.000% Floor (4)(16)
 
1/26/2023
 
1,979,798

 
1,846,300

 
1,446,440

 
0.2%
 
 
 
 
 
 
 
 
1,979,798

 
1,846,300

 
1,446,440

 
 
PetroChoice Holdings, Inc.
 
Chemicals, Plastics & Rubber
 
Senior Secured Second Lien Term Loan LIBOR + 8.750%, 1.000% Floor (4)(5)(13)(16) 
 
9/3/2023
 
9,000,000

 
9,000,000

 
9,000,000

 
1.2%
 
 
 
 
 
 
 
 
9,000,000

 
9,000,000

 
9,000,000

 
 
Polymer Solutions Group Holdings, LLC
 
Chemicals, Plastics & Rubber
 
Senior Secured First Lien Term Loan LIBOR + 6.250%, 1.000% Floor (5)(7)
 
6/22/2022
 
2,468,000

 
2,468,000

 
2,468,000

 
0.3%
 
 
 
 
 
 
 
 
2,468,000

 
2,468,000

 
2,468,000

 
 
Preferred Proppants, LLC
 
Energy: Oil & Gas
 
Senior Secured First Lien Term Loan LIBOR + 5.750%, 1.000% Floor (4)
 
7/27/2020
 
5,918,636

 
5,014,085

 
5,654,073

 
0.8%
 
 
 
 
 
 
 
 
5,918,636

 
5,014,085

 
5,654,073

 
 
Press Ganey Holdings, Inc
 
Healthcare & Pharmaceuticals
 
Senior Secured Second Lien Term Loan LIBOR + 6.500%, 1.000% Floor (7)
 
10/21/2024
 
8,753,172

 
8,821,293

 
8,791,686