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EX-32.1 - EXHIBIT 32.1 - Sierra Income Corpsic-ex321x063018.htm
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EX-31.1 - EXHIBIT 31.1 - Sierra Income Corpsic-ex311x063018.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 June 30, 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 August 9, 2018, the Registrant had 96,925,815 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
 
 
June 30, 2018
 
December 31, 2017
ASSETS
 
(unaudited)
 
 
Investments at fair value
 
 
 
 
Non-controlled/non-affiliated investments (amortized cost of $879,297,564 and $975,968,734, respectively)
 
$
829,963,524

 
$
917,820,822

Controlled/affiliated investments (amortized cost of $179,524,217 and $153,660,073, respectively)
 
161,446,505

 
146,288,268

Investments at fair value
 
991,410,029

 
1,064,109,090

Cash and cash equivalents
 
53,032,878

 
64,909,759

Cash collateral on total return swap (Note 5)
 
46,000,000

 
48,000,000

Interest receivable from non-controlled/non-affiliated investments
 
9,508,523

 
9,039,243

Unsettled trades receivable
 
2,254,019

 
339,573

Receivable due on total return swap (Note 5)
 
488,111

 
462,555

Interest receivable from controlled/affiliated investments
 
331,587

 
638,458

Prepaid expenses and other assets
 
340,550

 
219,096

Receivable for Company shares sold
 

 
235,060

Total assets
 
$
1,103,365,697

 
$
1,187,952,834

 
 
 
 
 
LIABILITIES
 
 
 
 
Revolving credit facilities payable (net of deferred financing costs of $4,381,791 and $5,286,927, respectively) (Note 6)
 
$
380,618,209

 
$
429,713,073

Payable for Company shares redeemed
 
6,666,454

 

Base management fees payable (Note 7)
 
4,834,494

 
5,196,997

Unrealized depreciation on total return swap (Note 5)
 
2,720,213

 
5,354,868

Interest payable
 
1,752,061

 
1,822,523

Accounts payable and accrued expenses
 
1,325,986

 
1,755,968

Administrator fees payable (Note 7)
 
758,177

 
695,777

Unsettled trades payable
 
503,750

 
308,233

Deferred tax liability
 
213,177

 
291,454

Incentive fees payable (Note 7)
 

 
2,827,372

Total liabilities
 
$
399,392,521

 
$
447,966,265

 
 
 
 
 
Commitments (Note 11)
 
 
 
 
 
 
 
 
 
NET ASSETS
 
 
 
 
Common shares, par value $0.001 per share, 250,000,000 common shares authorized, 96,784,857
and 96,620,231 common shares issued and outstanding, respectively
 
$
96,785

 
$
96,620

Capital in excess of par value
 
844,995,420

 
843,592,066

Accumulated distribution in excess of net realized gain/(loss) from investments and total return swap
 
(80,238,359
)
 
(49,402,054
)
Accumulated undistributed net investment income
 
9,377,872

 
16,779,377

Net unrealized appreciation/(depreciation) on investments and total return swap, net of provision for
taxes of ($126,577) and ($204,855), respectively
 
(70,258,542
)
 
(71,079,440
)
Total net assets
 
703,973,176

 
739,986,569

Total liabilities and net assets
 
$
1,103,365,697

 
$
1,187,952,834

 
 
 
 
 
NET ASSET VALUE PER COMMON SHARE
 
$
7.27

 
$
7.66

See accompanying notes to consolidated financial statements.

F-1


Sierra Income Corporation
Consolidated Statements of Operations
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
 
2018
 
2017
 
2018
 
2017
INVESTMENT INCOME
 
(unaudited)
 
(unaudited)
 
(unaudited)
 
(unaudited)
Interest and dividends from investments
 
 
 
 
 
 
 
 
Non-controlled/non-affiliated investments:
 
 
 
 
 
 
 
 
Cash
 
$
20,570,784

 
$
21,009,050

 
$
41,251,531

 
$
40,724,339

Payment-in-kind
 
303,893

 
708,422

 
576,517

 
2,523,471

Controlled/affiliated investments:
 
 
 
 
 
 
 
 
Cash
 
2,522,757

 
2,043,533

 
4,885,199

 
4,476,334

Payment-in-kind
 
490,883

 
270,379

 
867,382

 
334,977

Total interest and dividend income
 
23,888,317

 
24,031,384

 
47,580,629

 
48,059,121

Fee income (Note 12)
 
947,466

 
649,964

 
1,592,141

 
2,840,164

Interest from cash and cash equivalents
 
55,100

 
22,877

 
78,153

 
35,531

Total investment income
 
24,890,883

 
24,704,225

 
49,250,923

 
50,934,816

EXPENSES
 
 
 
 
 
 
 
 
Interest and financing expenses
 
5,219,779

 
4,517,158

 
10,392,209

 
8,461,242

Base management fees (Note 7)
 
4,834,495

 
5,449,266

 
9,838,311

 
10,657,835

General and administrative expenses
 
1,216,840

 
887,678

 
2,641,958

 
1,769,807

Administrator expenses (Note 7)
 
758,178

 
794,622

 
1,481,713

 
1,588,151

Professional fees
 
413,143

 
646,616

 
750,689

 
1,232,659

Offering costs
 
187,736

 
299,700

 
470,986

 
821,384

Incentive fees (Note 7)
 

 

 

 
548,806

Total expenses
 
12,630,171

 
12,595,040

 
25,575,866

 
25,079,884

NET INVESTMENT INCOME
 
12,260,712

 
12,109,185

 
23,675,057

 
25,854,932

REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS
 
 
 
 
 
 
 
 
Net realized gain/(loss) from non-controlled/non-affiliated investments
 
909,846

 
(2,745,404
)
 
(31,271,252
)
 
(15,939,732
)
Net realized gain/(loss) on total return swap (Note 5)
 
(1,043,675
)
 
(7,589,962
)
 
434,947

 
(4,870,611
)
Net change in unrealized appreciation/(depreciation) on non-controlled/non-affiliated investments
 
(14,252,484
)
 
(5,152,411
)
 
8,813,872

 
1,563,788

Net change in unrealized appreciation/(depreciation) on controlled/affiliated investments
 
(2,837,785
)
 
1,241,507

 
(10,705,907
)
 
125,432

Net change in unrealized appreciation/(depreciation) on total return swap (Note 5)
 
(306,714
)
 
10,300,626

 
2,634,655

 
10,196,270

Change in provision for deferred taxes on unrealized appreciation/(depreciation) on investments
 
(57,177
)
 
(36,746
)
 
78,278

 
(334,318
)
Net realized and unrealized gain/(loss) on investments
 
(17,587,989
)
 
(3,982,390
)
 
(30,015,407
)
 
(9,259,171
)
NET INCREASE/(DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS
 
$
(5,327,277
)
 
$
8,126,795

 
$
(6,340,350
)
 
$
16,595,761

WEIGHTED AVERAGE - BASIC AND DILUTED EARNINGS PER COMMON SHARE
 
$
(0.05
)
 
$
0.08

 
$
(0.07
)
 
$
0.17

WEIGHTED AVERAGE - BASIC AND DILUTED NET INVESTMENT INCOME PER COMMON SHARE
 
$
0.13

 
$
0.13

 
$
0.24

 
$
0.27

WEIGHTED AVERAGE COMMON STOCK OUTSTANDING - BASIC AND DILUTED (NOTE 10)
 
97,385,971

 
96,367,879

 
97,190,689

 
95,877,796

DISTRIBUTIONS DECLARED PER COMMON SHARE
 
$
0.16

 
$
0.16

 
$
0.32

 
$
0.32

See accompanying notes to the consolidated financial statements.

F-2


Sierra Income Corporation
Consolidated Statements of Changes in Net Assets
 
Six Months Ended June 30,
 
2018
 
2017
INCREASE/(DECREASE) FROM OPERATIONS
(unaudited)
 
(unaudited)
Net investment income
$
23,675,057

 
$
25,854,932

Net realized gain/(loss) on investments
(31,271,252
)
 
(15,939,732
)
Net realized gain/(loss) on total return swap (Note 5)
434,947

 
(4,870,611
)
Net change in unrealized appreciation/(depreciation) on investments
(1,892,035
)
 
1,689,220

Net change in unrealized appreciation/(depreciation) on total return swap (Note 5)
2,634,655

 
10,196,270

Change in provision for deferred taxes on unrealized appreciation/(depreciation) on investments
78,278

 
(334,318
)
Net increase/(decrease) in net assets resulting from operations
(6,340,350
)
 
16,595,761

SHAREHOLDER DISTRIBUTIONS (Note 2)
 
 
 
Distributions from net investment income
(31,076,562
)
 
(30,665,819
)
Distributions from return of capital

 

Distributions from net realized gains

 

Net decrease in net assets from shareholder distributions
(31,076,562
)
 
(30,665,819
)
COMMON SHARE TRANSACTIONS
 
 
 
Issuance of common shares, net of underwriting costs
2,478,445

 
11,370,406

Issuance of common shares pursuant to distribution reinvestment plan
13,174,371

 
14,068,852

Repurchase of common shares
(14,249,297
)
 
(14,507,550
)
Net increase in net assets resulting from common share transactions
1,403,519

 
10,931,708

Total increase/(decrease) in net assets
(36,013,393
)
 
(3,138,350
)
Net assets at beginning of period
739,986,569

 
773,113,087

Net assets at end of period(1)
$
703,973,176

 
$
769,974,737

 
 
 
 
Net asset value per common share
$
7.27

 
$
8.02

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

 
94,666,418

Issuance of common shares
323,587

 
1,393,488

Issuance of common shares pursuant to distribution reinvestment plan
1,721,015

 
1,745,246

Repurchase of common shares
(1,879,976
)
 
(1,783,393
)
Common shares outstanding, end of period
96,784,857

 
96,021,759


(1)
Net assets at end of period include accumulated undistributed net investment income of $9,377,872 and $14,945,853 as of June 30, 2018 and 2017, respectively.

See accompanying notes to consolidated financial statements.

F-3


Sierra Income Corporation
Consolidated Statements of Cash Flows
 
 
Six Months Ended June 30,
 
 
2018
 
2017
 
 
(unaudited)
 
(unaudited)
Cash flows from operating activities
 
 
 
 
NET INCREASE/(DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS:
 
$
(6,340,350
)
 
$
16,595,761

ADJUSTMENT TO RECONCILE NET INCREASE/(DECREASE) IN NET ASSETS
FROM OPERATIONS TO NET CASH USED IN OPERATING ACTIVITIES:
 
 
 
 
Payment-in-kind interest income
 
(1,443,899
)
 
(2,858,448
)
Net amortization of premium on investments
 
(998,023
)
 
(493,680
)
Amortization of deferred financing costs
 
942,636

 
718,280

Net realized (gain)/loss on investments
 
31,271,252

 
15,939,732

Net change in unrealized (appreciation)/depreciation on investments
 
1,892,035

 
(1,689,220
)
Net change in unrealized (appreciation)/depreciation on total return swap (Note 5)
 
(2,634,655
)
 
(10,196,270
)
Purchases and originations
 
(122,795,043
)
 
(240,889,700
)
Proceeds from sale of investments and principal repayments
 
164,772,739

 
149,796,557

(Increase)/decrease in operating assets:
 
 
 
 
Cash collateral on total return swap (Note 5)
 

 
4,120,942

Unsettled trades receivable
 
(1,914,446
)
 
(6,425,640
)
Due from affiliate (Note 7)
 

 
4,571,137

Interest receivable from non-controlled/non-affiliated investments
 
(469,280
)
 
1,525,620

Interest receivable from controlled/affiliated investments
 
306,871

 
918,232

Receivable for Company shares sold
 
235,060

 
(206,277
)
Receivable due on total return swap (Note 5)
 
(25,556
)
 
(609,665
)
Prepaid expenses and other assets
 
(121,454
)
 
(77,786
)
Increase/(decrease) in operating liabilities:
 
 
 
 
Unsettled trades payable
 
195,517

 
36,065,885

Management fee payable
 
(362,503
)
 
311,158

Accounts payable and accrued expenses
 
(429,982
)
 
(437,950
)
Incentive fees payable
 
(2,827,372
)
 
(1,405,419
)
Administrator fees payable
 
62,400

 
(56,056
)
Interest payable
 
(70,462
)
 
(415,701
)
Deferred tax liability
 
(78,277
)
 
334,318

Due to affiliate (Note 7)
 

 
(135,784
)
NET CASH PROVIDED BY/(USED IN) OPERATING ACTIVITIES
 
59,167,208

 
(34,999,974
)
Cash flows from financing activities:
 
 
 
 
Borrowings under revolving credit facility
 
38,000,000

 
105,000,000

Repayments of revolving credit facility
 
(88,000,000
)
 
(65,000,000
)
Proceeds from issuance of common stock, net of underwriting costs
 
2,478,445

 
11,370,406

Payment of cash distributions
 
(17,902,191
)
 
(16,596,967
)
Financing costs paid
 
(37,500
)
 
(390,000
)
Repurchase of common shares
 
(7,582,843
)
 
(14,507,550
)
NET CASH PROVIDED BY/(USED IN) FINANCING ACTIVITIES
 
(73,044,089
)
 
19,875,889

TOTAL INCREASE/(DECREASE) IN CASH
 
(13,876,881
)
 
(15,124,085
)
CASH AND CASH COLLATERAL ON TOTAL RETURN SWAP AT BEGINNING OF PERIOD
 
112,909,759

 
99,400,794

CASH AND CASH COLLATERAL ON TOTAL RETURN SWAP AT END OF PERIOD(1)
 
$
99,032,878

 
$
84,276,709

Supplemental Information:
 
 
 
 
Cash paid during the period for interest
 
$
9,520,035

 
$
8,158,663

Supplemental non-cash information:
 
 
 
 
Non-cash purchase of investments
 
$
20,928,063

 
$
21,975,181

Non-cash sale of investments
 
20,928,063

 
21,975,181

Payment-in-kind interest income
 
1,443,899

 
2,858,448

Amortization of deferred financing costs
 
942,636

 
718,280

Net amortization of premium on investments
 
998,023

 
493,680

Issuance of common shares in connection with distribution reinvestment plan
 
$
13,174,371

 
$
14,068,852

(1)
Includes cash and cash equivalents of $53,032,878 and $84,276,709 and cash collateral on total return swap of $46,000,000 and $75,500,000 as of June 30, 2018 and 2017, respectively.
See accompanying notes to consolidated financial statements.

F-4


Sierra Income Corporation
Consolidated Schedule of Investments
As of June 30, 2018
(unaudited)

Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
Non-controlled/non-affiliated investments – 117.9%
 
 
 
 
 
 
 
$
703,973,176

AAAHI Acquisition Corporation
 
Transportation: Consumer
 
Senior Secured First Lien Term Loan LIBOR + 7.000%, 1.000% Floor (4)(5)
 
12/15/2021
 
$
7,007,360

 
$
7,007,360

 
$
7,007,360

 
1.0%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 7.000%, 1.000% Floor (4)(5)(6)
 
12/14/2018
 
1,742,263

 
1,742,263

 
1,742,263

 
0.2%
 
 
 
 
 
 
 
 
8,749,623

 
8,749,623

 
8,749,623

 
 
Alpha Media LLC
 
Media: Broadcasting & Subscription
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (7)
 
2/25/2022
 
5,928,635

 
5,751,749

 
5,582,996

 
0.8%
 
 
 
 
 
 
 
 
5,928,635

 
5,751,749

 
5,582,996

 
 
 Alpine SG, LLC
 
 High Tech Industries
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (4)(5)(6)
 
11/16/2022
 
6,630,037

 
6,630,037

 
6,605,506

 
0.9%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (4)(5)
 
11/16/2022
 
13,432,500

 
13,432,500

 
13,382,800

 
1.9%
 
 
 
 
 
 
 
 
20,062,537

 
20,062,537

 
19,988,306

 
 
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
 
11,927,204

 
11,927,204

 
12,077,486

 
1.7%
 
 
 
 
 
 
 
 
11,927,204

 
11,927,204

 
12,077,486

 
 
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

 
 
Answers Finance, LLC
 
High Tech Industries
 
Senior Secured Second Lien Term Loan Base Rate + 7.900%, 1.100% Cap (11)
 
9/15/2021
 
1,993,500

 
1,993,500

 
1,993,500

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

 
5,426,955

 
5,426,195

 
0.8%
 
 
 
 
 
 
 
 
1,993,500

 
7,420,455

 
7,419,695

 
 
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

 
14,374,986

 
15,084,479

 
2.1%
 
 
 
 
 
 
 
 
18,357,647

 
14,374,986

 
15,084,479

 
 
Asurion, LLC
 
Banking, Finance, Insurance & Real Estate
 
Senior Secured Second Lien Term Loan LIBOR + 6.000%, 1.000% Floor (5)(7)
 
8/4/2025
 
5,950,000

 
5,950,000

 
6,032,110

 
0.9%
 
 
 
 
 
 
 
 
5,950,000

 
5,950,000

 
6,032,110

 
 
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

 
3.6%
 
 
 
 
 
 
 
 
25,000,000

 
25,000,000

 
25,000,000

 
 
Barry's Bootcamp Holdings, LLC
 
Services: Consumer
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (4)(5)(6)
 
7/14/2022
 
8,571,429

 
8,571,429

 
8,522,572

 
1.2%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (4)(5)(6)
 
7/14/2022
 
1,120,000

 
1,120,000

 
1,111,857

 
0.2%
 
 
 
 
 
 
 
 
9,691,429

 
9,691,429

 
9,634,429

 
 
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
 
18,867,188

 
18,867,188

 
18,483,180

 
2.6%
 
 
 
 
 
 
 
 
18,867,188

 
18,867,188

 
18,483,180

 
 
BRG Sports, Inc.
 
Consumer Goods: Durable
 
Senior Secured First Lien Term Loan LIBOR + 6.500%, 1.000% Floor (5)(7)
 
6/15/2023
 
7,700,000

 
7,700,000

 
7,700,000

 
1.1%
 
 
 
 
 
 
 
 
7,700,000

 
7,700,000

 
7,700,000

 
 

F-5


Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
Brook & Whittle Holding Corp.
 
Containers, Packaging & Glass
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (4)(5)(6)
 
10/17/2023
 
3,026,576

 
3,026,576

 
3,026,576

 
0.4%
 
 
 
 
 
 
 
 
3,026,576

 
3,026,576

 
3,026,576

 
 
BW NHHC Holdco Inc.
 
Healthcare & Pharmaceuticals
 
Senior Secured First Lien Term Loan LIBOR + 5.000%, 1.000% Floor(7)
 
5/15/2025
 
7,000,000

 
6,895,000

 
6,895,000

 
1.0%
 
 
 
 
 
 
 
 
7,000,000

 
6,895,000

 
6,895,000

 
 
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
 
2,960,939

 
2,960,939

 
2,960,939

 
0.4%
 
 
 
 
 
 
 
 
2,960,939

 
2,960,939

 
2,960,939

 
 
Covenant Surgical Partners, Inc.
 
Healthcare & Pharmaceuticals
 
Senior Secured First Lien Term Loan LIBOR + 4.750%(4)(5)
 
10/4/2024
 
5,357,692

 
5,345,578

 
5,350,192

 
0.8%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 4.750%(4)(5)(6)
 
10/4/2024
 
964,717

 
961,074

 
962,461

 
0.1%
 
 
 
 
 
 
 
 
6,322,409

 
6,306,652

 
6,312,653

 
 
CP Opco, LLC
 
Services: Consumer
 
Senior Secured First Lien Term Loan Base Rate + 5.500%, PIK (5)(7)(11)(14) 
 
4/1/2019
 
236,515

 
209,514

 
41,296

 
0.0%
 
 
 
 
Senior Secured First Lien Term Loan Base Rate + 8.500%, PIK (5)(7)(11)(14) 
 
4/1/2019
 
1,766,333

 
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%
 
 
 
 
 
 
 
 
2,002,848

 
926,530

 
41,296

 
 
CPI International, Inc.
 
Aerospace & Defense
 
Senior Secured Second Lien Term Loan LIBOR + 7.250%, 1.000% Floor (5)(7)(15)
 
7/28/2025
 
9,900,752

 
9,869,843

 
9,829,466

 
1.4%
 
 
 
 
 
 
 
 
9,900,752

 
9,869,843

 
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
 
4,923,123

 
4,923,123

 
4,923,123

 
0.7%
 
 
 
 
 
 
 
 
4,923,123

 
4,923,123

 
4,923,123

 
 
DHISCO Electronic Distribution, Inc.
 
Hotel, Gaming & Leisure
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 1.500% Floor (5)(7)
 
11/10/2019
 
2,702,877

 
2,702,877

 
2,702,877

 
0.4%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 11.000%, 1.500% Floor, PIK (5)(7)(14) 
 
11/10/2019
 
10,130,848

 
9,207,947

 
836,808

 
0.1%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 12.250%, 1.500% Floor, PIK (5)(7)(14) 
 
11/10/2019
 
8,851,405

 
7,257,480

 

 
0.0%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 13.250%, 1.500% Floor, PIK (5)(7)(14) 
 
11/10/2019
 
8,361,380

 
2,940,892

 

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

 
769,231

 

 
0.0%
 
 
 
 
 
 
 
 
30,046,510

 
22,878,427

 
3,539,685

 
 
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

 
10,042,010

 
10,000,000

 
1.4%
 
 
 
 
 
 
 
 
10,000,000

 
10,042,010

 
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

 
4,893,717

 
5,667,200

 
0.8%
 
 
 
 
 
 
 
 
7,000,000

 
4,893,717

 
5,667,200

 
 
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

 
2,908,350

 
2,779,798

 
0.4%
 
 
 
 
 
 
 
 
3,620,000

 
2,908,350

 
2,779,798

 
 
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

 
15,192,738

 
14,918,857

 
2.1%
 
 
 
 
 
 
 
 
17,233,288

 
15,192,738

 
14,918,857

 
 

F-6


Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
Dynamic Energy Services International LLC
 
Energy: Oil & Gas
 
Senior Secured First Lien Term Loan 13.500% PIK + LIBOR (4)(5)(14) 
 
5/6/2019
 
10,597,949

 
9,828,831

 
3,179,385

 
0.5%
 
 
 
 
 
 
 
 
10,597,949

 
9,828,831

 
3,179,385

 
 
Elite Comfort Solutions LLC
 
Chemicals, Plastics & Rubber
 
Senior Secured First Lien Term Loan LIBOR + 6.500%, 1.000% Floor (4)(6)
 
1/15/2021
 
9,443,153

 
9,443,153

 
9,443,153

 
1.3%
 
 
 
 
 
 
 
 
9,443,153

 
9,443,153

 
9,443,153

 
 
Engineered Machinery Holdings, Inc.
 
Capital Equipment
 
Senior Secured Second Lien Term Loan LIBOR + 7.250%, 1.000% Floor (4)(5)
 
7/18/2025
 
2,936,702

 
2,917,010

 
2,898,231

 
0.4%
 
 
 
 
 
 
 
 
2,936,702

 
2,917,010

 
2,898,231

 
 
First Boston Construction Holdings, LLC
 
Banking, Finance, Insurance & Real Estate
 
Senior secured first lien notes 12.000% (5)
 
12/31/2020
 
9,965,000

 
9,965,000

 
9,965,000

 
1.4%
 
 
 
 
Preferred Equity - 1,646,250 units (5)(12)
 
 
 

 
2,491,250

 
2,491,250

 
0.4%
 
 
 
 
 
 
 
 
9,965,000

 
12,456,250

 
12,456,250

 
 
FKI Security Group, LLC
 
Capital Equipment
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 1.000% Floor (4)(5)
 
3/30/2020
 
11,375,000

 
11,375,000

 
11,375,000

 
1.6%
 
 
 
 
 
 
 
 
11,375,000

 
11,375,000

 
11,375,000

 
 
Friedrich Holdings, Inc.
 
Construction & Building
 
Senior Secured First Lien Term Loan LIBOR + 7.000%, 1.000% Floor (5)(7)
 
2/7/2023
 
13,256,343

 
13,256,343

 
13,388,906

 
1.9%
 
 
 
 
 
 
 
 
13,256,343

 
13,256,343

 
13,388,906

 
 
Fusion Telecommunications International Inc.
 
Telecommunications
 
Senior Secured First Lien Term Loan LIBOR + 7.500%, 1.000% Floor (4)
 
5/4/2023
 
3,437,500

 
3,301,465

 
3,300,000

 
0.5%
 
 
 
 
 
 
 
 
3,437,500

 
3,301,465

 
3,300,000

 
 
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

 
8,969,000

 
1.3%
 
 
 
 
 
 
 
 
10,000,000

 
10,000,000

 
8,969,000

 
 
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
 
3,692,848

 
3,692,848

 
3,692,848

 
0.5%
 
 
 
 
 
 
 
 
3,692,848

 
3,692,848

 
3,692,848

 
 
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
 
11,812,500

 
11,812,500

 
11,514,825

 
1.6%
 
 
 
 
 
 
 
 
11,812,500

 
11,812,500

 
11,514,825

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

 
15,000,000

 
15,115,500

 
2.1%
 
 
 
 
 
 
 
 
15,000,000

 
15,000,000

 
15,115,500

 
 
High Ridge Brands Co.
 
Consumer Goods: Non-Durable
 
Senior secured first lien notes 8.875% (5)(8)(16)
 
3/15/2025
 
2,000,000

 
2,000,000

 
890,800

 
0.1%
 
 
 
 
 
 
 
 
2,000,000

 
2,000,000

 
890,800

 
 
Holland Acquisition Corp.
 
Energy: Oil & Gas
 
Senior Secured First Lien Term Loan LIBOR + 9.000%, 1.000% Floor (4)
 
5/29/2020
 
4,493,420

 
4,466,620

 
3,200,663

 
0.5%
 
 
 
 
 
 
 
 
4,493,420

 
4,466,620

 
3,200,663

 
 
Hylan Datacom & Electrical LLC
 
Construction & Building
 
Senior Secured First Lien Term Loan LIBOR + 7.500%, 1.000% Floor (5)(7)
 
7/25/2021
 
14,670,095

 
14,670,095

 
14,670,095

 
2.1%
 
 
 
 
 
 
 
 
14,670,095

 
14,670,095

 
14,670,095

 
 
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

 
3.6%
 
 
 
 
 
 
 
 
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 (5)(7)(15)
 
6/21/2023
 
8,950,000

 
8,837,978

 
8,312,760

 
1.2%

F-7


Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
 
 
 
 
 
 
 
 
8,950,000

 
8,837,978

 
8,312,760

 
 
Impact Sales, LLC
 
Services: Business
 
Senior Secured First Lien Term Loan LIBOR + 6.250%, 1.000% Floor (4)(5)
 
6/27/2023
 
6,189,258

 
6,189,258

 
6,189,258

 
0.9%
 
 
 
 
 
 
 
 
6,189,258

 
6,189,258

 
6,189,258

 
 
Interflex Acquisition Company, LLC
 
Containers, Packaging & Glass
 
Senior Secured First Lien Term Loan LIBOR + 8.000%, 1.000% Floor (5)(7)
 
8/18/2022
 
13,775,000

 
13,775,000

 
12,960,897

 
1.8%
 
 
 
 
 
 
 
 
13,775,000

 
13,775,000

 
12,960,897

 
 
Invision Diversified, LLC
 
Services: Business
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 1.000% Floor (4)(5)(13)
 
6/30/2020
 
23,100,084

 
23,100,084

 
23,100,084

 
3.3%
 
 
 
 
 
 
 
 
23,100,084

 
23,100,084

 
23,100,084

 
 
IOP Monroe Acquisition, Inc.
 
Capital Equipment
 
Senior Secured First Lien Term Loan LIBOR + 5.500%, 1.000% Floor (5)(6)(7)
 
4/1/2022
 
950,000

 
950,000

 
950,000

 
0.1%
 
 
 
 
 
 
 
 
950,000

 
950,000

 
950,000

 
 
Isagenix International, LLC
 
Wholesale
 
Senior Secured First Lien Term Loan LIBOR + 5.750%, 1.000% Floor (4)(5)
 
6/16/2025
 
2,000,000

 
1,988,808

 
2,000,000

 
0.3%
 
 
 
 
 
 
 
 
2,000,000

 
1,988,808

 
2,000,000

 
 
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
 
10,186,998

 
6,577,332

 
6,188,601

 
0.9%
 
 
 
 
Common Units - 10,283,782 units(9)(12)
 
 
 

 

 

 
0.0%
 
 
 
 
 
 
 
 
10,300,826

 
6,691,160

 
6,302,429

 
 
JFL-WCS Partners, LLC
 
Environmental Industries
 
Preferred Units - 618,876 6.000%, PIK (5)(9)
 
 
 

 
618,876

 
618,876

 
0.1%
 
 
 
 
Common Units - 66,764 units (5)(9)(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)(15)
 
5/1/2025
 
7,000,000

 
6,878,912

 
6,858,600

 
1.0%
 
 
 
 
 
 
 
 
7,000,000

 
6,878,912

 
6,858,600

 
 
L&S Plumbing Partnership, Ltd.
 
Construction & Building
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 1.000% Floor (4)(5)
 
2/15/2022
 
11,084,069

 
11,084,069

 
11,172,741

 
1.6%
 
 
 
 
 
 
 
 
11,084,069

 
11,084,069

 
11,172,741

 
 
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

 
4,503,825

 
4,325,879

 
0.6%
 
 
 
 
 
 
 
 
4,613,287

 
4,503,825

 
4,325,879

 
 
LTCG Holdings Corp.
 
Banking, Finance, Insurance & Real Estate
 
Senior Secured First Lien Term Loan LIBOR + 5.000%, 1.000% Floor (7)
 
6/6/2020
 
2,838,571

 
2,833,308

 
2,828,920

 
0.4%
 
 
 
 
 
 
 
 
2,838,571

 
2,833,308

 
2,828,920

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

 
1,875,000

 
1,871,400

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

 
11,972,163

 
10,708,190

 
1.5%
 
 
 
 
 
 
 
 
15,730,209

 
13,847,163

 
12,579,590

 
 
Manna Pro Products, LLC
 
Consumer Goods: Non-durable
 
Senior Secured First Lien Term Loan LIBOR + 6.000%, 1.000% Floor (5)(6)(7)
 
12/8/2023
 
4,654,166

 
4,654,166

 
4,611,346

 
 
 
 
 
 
 
 
 
 
4,654,166

 
4,654,166

 
4,611,346

 
 
Nathan's Famous, Inc.
 
Beverage & Food
 
Senior secured first lien notes 6.625% (5)(8)(9)(16)
 
11/1/2025
 
4,950,000

 
4,966,193

 
4,996,530

 
0.7%
 
 
 
 
 
 
 
 
4,950,000

 
4,966,193

 
4,996,530

 
 
New Media Holdings II LLC
 
Media: Advertising, Printing & Publishing
 
Senior Secured First Lien Term Loan LIBOR + 6.250%, 1.000% Floor (5)(7)(15)
 
7/14/2022
 
13,801,587

 
13,793,795

 
13,801,587

 
2.0%
 
 
 
 
 
 
 
 
13,801,587

 
13,793,795

 
13,801,587

 
 

F-8


Company(1)(2)
 
Industry
 
Type of Investment
 
Maturity
 
Par
Amount
 
Cost
 
Fair Value
 
% of Net Assets(3)
Novetta Solutions, LLC
 
High Tech Industries
 
Senior Secured Second Lien Term Loan LIBOR + 8.500%, 1.000% Floor (7)
 
10/16/2023
 
11,000,000

 
10,920,879

 
10,225,600

 
1.5%
 
 
 
 
 
 
 
 
11,000,000

 
10,920,879

 
10,225,600

 
 
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
 
12,535,235

 
11,685,379

 
6,672,506

 
0.9%
 
 
 
 
Senior Secured First Lien Term Loan LIBOR + 8.500%, 0.750% Floor, 3.000% PIK (4)(5)(14)
 
12/31/2018
 
8,884,762

 
8,308,439

 
4,729,359

 
0.7%
 
 
 
 
 
 
 
 
21,419,997

 
19,993,818

 
11,401,865

 
 
Path Medical, LLC
 
Healthcare & Pharmaceuticals
 
Senior Secured First Lien Term Loan LIBOR + 9.500%, 1.000% Floor (5)(7)
 
10/11/2021
 
14,610,737

 
14,190,519

 
13,719,482

 
1.9%
 
 
 
 
Warrants - 2.09%  of outstanding equity  (5)(12)
 
 
 

 
669,709

 

 
0.0%
 
 
 
 
 
 
 
 
14,610,737

 
14,860,228

 
13,719,482

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

 
543,120

 
543,153

 
0.1%
 
 
 
 
 
 
 
 

 
543,120

 
543,153

 
 
PetroChoice Holdings, Inc.
 
Chemicals, Plastics & Rubber
 
Senior Secured Second Lien Term Loan LIBOR + 8.750%, 1.000% Floor (4)(5)(13)(15) 
 
9/3/2023
 
9,000,000

 
9,000,000

 
9,000,000

 
1.3%
 
 
 
 
 
 
 
 
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)
 
6/30/2021
 
2,461,830

 
2,461,830

 
2,461,830

 
0.3%