10-Q 1 d286792d10q.htm FS INVESTMENT CORP 10-Q FS investment Corp 10-Q
Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 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 SEPTEMBER 30, 2016

 

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

COMMISSION FILE NUMBER: 814-00757

 

 

FS Investment Corporation

(Exact name of registrant as specified in its charter)

 

 

 

Maryland   26-1630040
(State of Incorporation)  

(I.R.S. Employer

Identification Number)

201 Rouse Boulevard
Philadelphia, Pennsylvania
  19112
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code: (215) 495-1150

 

 

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 shorter period that the registrant was required to submit and post such files).    Yes  ¨    No  ¨.

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

 

Large accelerated filer   x    Accelerated filer   ¨
Non-accelerated filer   ¨ (Do not check if a smaller reporting company)    Smaller reporting company   ¨

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

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

There were 244,063,316 shares of the registrant’s common stock outstanding as of November 8, 2016.

 

 

 


Table of Contents

TABLE OF CONTENTS

 

          Page  
PART I—FINANCIAL INFORMATION   
ITEM 1.   

FINANCIAL STATEMENTS

     1   
  

Consolidated Balance Sheets as of September 30, 2016 (Unaudited) and December 31, 2015

     1   
  

Unaudited Consolidated Statements of Operations for the three and nine months ended September 30, 2016 and 2015

     2   
  

Unaudited Consolidated Statements of Changes in Net Assets for the nine months ended September 30, 2016 and 2015

     3   
  

Unaudited Consolidated Statements of Cash Flows for the nine months ended September 30, 2016 and 2015

     4   
  

Consolidated Schedules of Investments as of September 30, 2016 (Unaudited) and December 31, 2015

     5   
  

Notes to Unaudited Consolidated Financial Statements

     25   
ITEM 2.   

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     59   
ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK      84   
ITEM 4.   

CONTROLS AND PROCEDURES

     85   
PART II—OTHER INFORMATION   
ITEM 1.   

LEGAL PROCEEDINGS

     86   
ITEM 1A.   

RISK FACTORS

     86   
ITEM 2.   

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

     86   
ITEM 3.   

DEFAULTS UPON SENIOR SECURITIES

     86   
ITEM 4.   

MINE SAFETY DISCLOSURES

     86   
ITEM 5.   

OTHER INFORMATION

     86   
ITEM 6.   

EXHIBITS

     87   
   SIGNATURES      90   


Table of Contents

PART I—FINANCIAL INFORMATION

 

Item 1. Financial Statements.

FS Investment Corporation

Consolidated Balance Sheets

(in thousands, except share and per share amounts)

 

 

 

    September 30, 2016
(Unaudited)
    December 31,
2015
 

Assets

   

Investments, at fair value

   

Non-controlled/unaffiliated investments (amortized cost—$3,790,661 and $4,027,950, respectively)

  $ 3,679,252      $ 3,820,283   

Non-controlled/affiliated investments (amortized cost—$126,209 and $91,248, respectively)

    171,141        132,357   

Controlled/affiliated investments (amortized cost—$79,698 and $75,988, respectively)

    87,133        76,731   
 

 

 

   

 

 

 

Total investments, at fair value (amortized cost—$3,996,568 and $4,195,186, respectively)

    3,937,526        4,029,371   

Cash

    112,648        80,807   

Foreign currency, at fair value (cost—$1,011 and $1,175, respectively)

    1,013        1,180   

Receivable for investments sold and repaid

    27,160        66   

Interest receivable

    49,014        34,600   

Deferred financing costs

    573        1,420   

Prepaid expenses and other assets

    684        729   
 

 

 

   

 

 

 

Total assets

  $ 4,128,618      $ 4,148,173   
 

 

 

   

 

 

 

Liabilities

   

Payable for investments purchased

  $ 6,984      $ —     

Credit facilities payable

    81,286        34,625   

Unsecured notes payable (net of deferred financing costs of $1,231 and $1,490, respectively)

    990,333        988,274   

Repurchase agreement payable(1)

    650,000        800,000   

Secured borrowing, at fair value (proceeds of $2,830 and $0, respectively)(2)

    2,863        —     

Stockholder distributions payable

    54,236        54,093   

Management fees payable

    17,872        18,415   

Subordinated income incentive fees payable(3)

    12,250        13,374   

Administrative services expense payable

    714        946   

Interest payable

    16,113        22,061   

Directors’ fees payable

    204        282   

Other accrued expenses and liabilities

    1,308        7,175   
 

 

 

   

 

 

 

Total liabilities

    1,834,163        1,939,245   
 

 

 

   

 

 

 

Commitments and contingencies(4)

    —          —     

Stockholders’ equity

   

Preferred stock, $0.001 par value, 50,000,000 shares authorized, none issued and outstanding

    —          —     

Common stock, $0.001 par value, 450,000,000 shares authorized, 243,488,590 and 242,847,016 shares issued and outstanding, respectively

    243        243   

Capital in excess of par value

    2,270,010        2,264,345   

Accumulated undistributed net realized gain/loss on investments and gain/loss on foreign currency(5)

    (64,574     (45,748

Accumulated undistributed (distributions in excess of) net investment income(5)

    141,160        147,946   

Net unrealized appreciation (depreciation) on investments and secured borrowing and unrealized gain/loss on foreign currency

    (52,384     (157,858
 

 

 

   

 

 

 

Total stockholders’ equity

    2,294,455        2,208,928   
 

 

 

   

 

 

 

Total liabilities and stockholders’ equity

  $ 4,128,618      $ 4,148,173   
 

 

 

   

 

 

 

Net asset value per share of common stock at period end

  $ 9.42      $ 9.10   

 

(1) See Note 8 for a discussion of the Company’s repurchase transaction.

 

(2) See Note 8 for a discussion of the Company’s secured borrowing.

 

(3) See Note 2 and Note 4 for a discussion of the methodology employed by the Company in calculating the subordinated income incentive fees.

 

(4) See Note 9 for a discussion of the Company’s commitments and contingencies.

 

(5) See Note 5 for a discussion of the sources of distributions paid by the Company.

See notes to unaudited consolidated financial statements.

 

1


Table of Contents

FS Investment Corporation

Unaudited Consolidated Statements of Operations

(in thousands, except share and per share amounts)

 

 

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2016     2015     2016     2015  

Investment income

        

From non-controlled/unaffiliated investments:

        

Interest income

   $ 93,380      $ 99,468      $ 285,151      $ 319,180   

Fee income

     4,214        3,290        21,191        33,707   

Dividend income

     —          —          —          5,519   

From non-controlled/affiliated investments:

        

Interest income

     2,013        910        4,092        1,628   

Fee income

     —          —          633        —     

Dividend income

     —          —          224        —     

From controlled/affiliated investments:

        

Interest income

     950        —          2,540        —     
  

 

 

   

 

 

   

 

 

   

 

 

 

Total investment income

     100,557        103,668        313,831        360,034   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses

        

Management fees

     17,872        18,852        53,258        56,993   

Capital gains incentive fees(1)

     —          (13,811     —          (18,418

Subordinated income incentive fees(1)

     12,250        12,485        38,945        47,661   

Administrative services expenses

     750        900        2,846        2,773   

Accounting and administrative fees

     243        261        706        822   

Interest expense

     18,283        19,352        55,241        55,699   

Directors’ fees

     277        232        780        688   

Other general and administrative expenses

     1,879        1,631        6,274        4,877   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     51,554        39,902        158,050        151,095   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

     49,003        63,766        155,781        208,939   
  

 

 

   

 

 

   

 

 

   

 

 

 

Realized and unrealized gain/loss

        

Net realized gain (loss) on investments:

        

Non-controlled/unaffiliated investments

     2,363        (21,246     (19,064     (42,135

Controlled/affiliated investments

     (26     —          (26     —     

Net realized gain (loss) on foreign currency

     86        266        264        (631

Net change in unrealized appreciation (depreciation) on investments:

        

Non-controlled/unaffiliated investments

     64,039        (74,848     96,258        (88,560

Non-controlled/affiliated investments

     (4,463     27,220        3,823        36,615   

Controlled/affiliated investments

     4,354        —          6,692        —     

Net change in unrealized appreciation (depreciation) on secured borrowing

     (33     —          (33     —     

Net change in unrealized gain (loss) on foreign currency

     (954     (437     (1,266     2,625   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total net realized and unrealized gain (loss)

     65,366        (69,045     86,648        (92,086
  

 

 

   

 

 

   

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

   $ 114,369      $ (5,279   $ 242,429      $ 116,853   
  

 

 

   

 

 

   

 

 

   

 

 

 

Per share information—basic and diluted

        

Net increase (decrease) in net assets resulting from operations (Earnings per Share)

   $ 0.47      $ (0.02   $ 1.00      $ 0.48   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares outstanding

     243,488,590        242,227,762        243,257,941        241,659,230   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) See Note 2 and Note 4 for a discussion of the methodology employed by the Company in calculating the capital gains incentive fees and subordinated income incentive fees.

See notes to unaudited consolidated financial statements.

 

2


Table of Contents

FS Investment Corporation

Unaudited Consolidated Statements of Changes in Net Assets

(in thousands)

 

 

 

     Nine Months Ended
September 30,
 
     2016     2015  

Operations

    

Net investment income (loss)

   $ 155,781      $ 208,939   

Net realized gain (loss) on investments and foreign currency

     (18,826     (42,766

Net change in unrealized appreciation (depreciation) on investments and secured borrowing

     106,740        (51,945

Net change in unrealized gain (loss) on foreign currency

     (1,266     2,625   
  

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

     242,429        116,853   
  

 

 

   

 

 

 

Stockholder distributions(1)

    

Distributions from net investment income

     (162,567     (127,414

Distributions from net realized gain on investments

     —          (34,097
  

 

 

   

 

 

 

Net decrease in net assets resulting from stockholder distributions

     (162,567     (161,511
  

 

 

   

 

 

 

Capital share transactions(2)

    

Reinvestment of stockholder distributions

     5,665        13,631   
  

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from capital share transactions

     5,665        13,631   
  

 

 

   

 

 

 

Total increase (decrease) in net assets

     85,527        (31,027

Net assets at beginning of period

     2,208,928        2,366,986   
  

 

 

   

 

 

 

Net assets at end of period

   $ 2,294,455      $ 2,335,959   
  

 

 

   

 

 

 

Accumulated undistributed (distributions in excess of) net investment income(1)

   $ 141,160      $ 150,183   
  

 

 

   

 

 

 

 

(1) See Note 5 for a discussion of the sources of distributions paid by the Company.

 

(2) See Note 3 for a discussion of the Company’s capital share transactions.

See notes to unaudited consolidated financial statements.

 

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Table of Contents

FS Investment Corporation

Unaudited Consolidated Statements of Cash Flows

(in thousands)

 

 

 

     Nine Months Ended
September 30,
 
     2016     2015  

Cash flows from operating activities

    

Net increase (decrease) in net assets resulting from operations

   $ 242,429      $ 116,853   

Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities:

    

Purchases of investments

     (662,756     (1,084,274

Paid-in-kind interest

     (23,276     (15,236

Proceeds from sales and repayments of investments

     872,931        1,114,231   

Net realized (gain) loss on investments

     19,090        42,135   

Net change in unrealized (appreciation) depreciation on investments and secured borrowing

     (106,740     51,945   

Accretion of discount

     (7,371     (25,433

Amortization of deferred financing costs and discount

     2,907        2,788   

Unrealized (gain)/loss on borrowings in foreign currency

     2,823        (2,804

(Increase) decrease in receivable for investments sold and repaid

     (27,094     (15,245

(Increase) decrease in interest receivable

     (14,414     1,395   

(Increase) decrease in prepaid expenses and other assets

     45        (261

Increase (decrease) in payable for investments purchased

     6,984        (28,095

Increase (decrease) in management fees payable

     (543     (715

Increase (decrease) in accrued capital gains incentive fees

     —          (18,418

Increase (decrease) in subordinated income incentive fees payable

     (1,124     (599

Increase (decrease) in administrative services expense payable

     (232     (1,009

Increase (decrease) in interest payable

     (5,948     2,567   

Increase (decrease) in directors’ fees payable

     (78     (77

Increase (decrease) in other accrued expenses and liabilities

     (5,867     (5,360
  

 

 

   

 

 

 

Net cash provided by (used in) operating activities

     291,766        134,388   
  

 

 

   

 

 

 

Cash flows from financing activities

    

Reinvestment of stockholder distributions

     5,665        13,631   

Stockholder distributions

     (162,424     (125,431

Borrowings under credit facilities(1)

     262,000        114,200   

Borrowings under unsecured notes(1)

     —          275,000   

Secured borrowing(3)

     2,829        —     

Repayments of credit facilities(1)

     (218,162     (268,411

Repayments under repurchase agreement(2)

     (150,000     (150,000

Deferred financing costs paid

     —          (4,286
  

 

 

   

 

 

 

Net cash provided by (used in) financing activities

     (260,092     (145,297
  

 

 

   

 

 

 

Total increase (decrease) in cash

     31,674        (10,909

Cash and foreign currency at beginning of period

     81,987        96,844   
  

 

 

   

 

 

 

Cash and foreign currency at end of period

   $ 113,661      $ 85,935   
  

 

 

   

 

 

 

Supplemental disclosure

    

Local and excise taxes paid

   $ 5,925      $ 5,638   
  

 

 

   

 

 

 

 

(1) See Note 8 for a discussion of the Company’s credit facilities and unsecured notes. During the nine months ended September 30, 2016 and 2015, the Company paid $39,942 and $27,851, respectively, in interest expense on the credit facilities and unsecured notes.

 

(2) See Note 8 for a discussion of the Company’s repurchase transaction. During the nine months ended September 30, 2016 and 2015, the Company paid $18,340 and $22,493, respectively, in interest expense pursuant to the repurchase agreement.

 

(3) See Note 8 for a discussion of the Company’s secured borrowing. During the nine months ended September 30, 2016, the Company did not pay any interest expense on the secured borrowing.

See notes to unaudited consolidated financial statements.

 

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Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal
Amount(c)
    Amortized
Cost
    Fair
Value(d)
 

Senior Secured Loans—First Lien—89.7%

               

5 Arch Income Fund 2, LLC

  (g)(i)(n)   Diversified Financials   10.5%     11/18/21   $ 16,536      $ 16,587      $ 16,536   

5 Arch Income Fund 2, LLC

  (g)(i)(n)(p)   Diversified Financials   10.5%     11/18/21     21,464        21,464        21,464   

A.P. Plasman Inc.

  (e)(f)(g)(i)   Capital Goods   L+850   1.0%   12/29/19     203,676        201,638        204,949   

Aeneas Buyer Corp.

  (g)   Health Care Equipment & Services   L+500   1.0%   12/18/21     919        919        919   

Aeneas Buyer Corp.

  (g)(p)   Health Care Equipment & Services   L+500   1.0%   12/18/21     75        75        75   

Aeneas Buyer Corp.

  (e)(g)   Health Care Equipment & Services   L+812   1.0%   12/18/21     77,220        77,220        78,378   

Aeneas Buyer Corp.

  (g)(p)   Health Care Equipment & Services   L+750   1.0%   12/18/21     1,980        1,980        2,010   

Altus Power America, Inc.

  (g)   Energy   L+750   1.5%   10/10/21     3,125        3,125        3,188   

AP Exhaust Acquisition, LLC

  (f)(g)   Automobiles & Components   L+775   1.5%   1/16/21     15,811        15,811        13,755   

ASG Technologies Group, Inc.

  (e)(g)(s)   Software & Services   L+787, 1.2% PIK
(1.2% Max PIK)
  1.0%   4/30/20     53,796        53,431        54,872   

Aspect Software, Inc.

  (g)   Software & Services   L+950   1.0%   5/25/18     481        481        486   

Aspect Software, Inc.

  (g)(p)   Software & Services   L+950   1.0%   5/25/18     175        175        177   

Aspect Software, Inc.

  (g)   Software & Services   L+950   1.0%   5/25/20     701        701        708   

Atlas Aerospace LLC

  (g)   Capital Goods   L+806   1.0%   5/8/19     20,000        20,000        20,300   

Atlas Aerospace LLC

  (g)(p)   Capital Goods   L+750   1.0%   5/8/19     7,619        7,619        7,733   

BenefitMall Holdings, Inc.

  (e)(g)   Commercial & Professional Services   L+725   1.0%   11/24/20     14,738        14,738        15,032   

BenefitMall Holdings, Inc.

  (g)(p)   Commercial & Professional Services   L+725   1.0%   11/24/20     5,455        5,455        5,564   

Blueprint Sub, Inc.

  (g)   Software & Services   L+450   1.0%   5/7/21     702        702        702   

Blueprint Sub, Inc.

  (g)(p)   Software & Services   L+450   1.0%   5/7/21     702        702        702   

Blueprint Sub, Inc.

  (e)   Software & Services   L+750   1.0%   5/7/21     26,697        26,697        26,781   

Blueprint Sub, Inc.

  (g)(p)   Software & Services   L+750   1.0%   5/7/21     3,509        3,509        3,520   

Cadence Aerospace Finance, Inc.

  (g)   Capital Goods   L+525   1.3%   5/9/18     74        73        69   

Caesars Entertainment Operating Co., Inc.

  (e)(g)(i)(k)   Consumer Services   5.8%     3/1/17     11,935        11,778        12,112   

Caesars Entertainment Operating Co., Inc.

  (e)(i)(k)   Consumer Services   6.7%     3/1/17     2,299        2,276        2,357   

Caesars Entertainment Operating Co., Inc.

  (e)(f)(g)(i)(k)   Consumer Services   9.0%     3/1/17     64,172        64,059        64,383   

Caesars Entertainment Resort Properties, LLC

  (e)(g)   Consumer Services   L+600   1.0%   10/11/20     21,900        21,035        21,900   

Corel Corp.

  (g)(i)   Software & Services   Prime+725     6/7/18     6,000        6,000        6,000   

Corel Corp.

  (g)(i)(p)   Software & Services   Prime+725     6/7/18     4,000        4,000        4,000   

Corel Corp.

  (e)(f)(g)(i)   Software & Services   L+825     6/7/19     103,423        103,423        104,328   

Corner Investment PropCo, LLC

  (e)(g)   Consumer Services   L+975   1.3%   11/2/19     42,303        42,415        41,879   

Crestwood Holdings LLC

  (g)   Energy   L+800   1.0%   6/19/19     5,035        5,023        4,678   

Eastman Kodak Co.

  (g)   Consumer Durables & Apparel   L+625   1.0%   9/3/19     10,438        10,323        10,416   

 

See notes to unaudited consolidated financial statements.

 

5


Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal
Amount(c)
    Amortized
Cost
    Fair
Value(d)
 

Greystone Equity Member Corp.

  (g)(i)   Diversified Financials   L+1050     3/31/21   $ 3,434      $ 3,449      $ 3,430   

Greystone Equity Member Corp.

  (g)(i)(p)   Diversified Financials   L+1100     3/31/21     50,566        50,566        50,752   

H.M. Dunn Co., Inc.

  (g)   Capital Goods   L+906   1.0%   3/26/21     1,000        1,000        1,011   

H.M. Dunn Co., Inc.

  (g)(p)   Capital Goods   L+725   1.0%   3/26/21     357        357        361   

Harvey Industries, Inc.

  (g)   Capital Goods   L+800   1.0%   10/1/21     32,667        32,667        33,320   

Imagine Communications Corp.

  (e)(f)(g)   Media   L+825   1.0%   4/29/20     76,853        76,853        76,853   

Imagine Communications Corp.

  (g)(p)   Media   L+825   1.0%   4/29/20     28,600        28,600        28,600   

Industrial Group Intermediate Holdings, LLC

  (g)   Materials   L+800   1.3%   5/31/20     20,778        20,778        21,090   

Industry City TI Lessor, L.P.

  (g)   Consumer Services   10.8%, 1.0% PIK
(1.0% Max PIK)
    6/30/26     33,034        33,034        34,191   

JMC Acquisition Merger Corp.

  (g)   Capital Goods   L+857   1.0%   11/6/21     5,679        5,679        5,736   

Latham Pool Products, Inc.

  (e)   Commercial & Professional Services   L+775   1.0%   6/29/21     70,000        70,000        70,000   

Leading Edge Aviation Services, Inc.

  (e)(f)(g)   Capital Goods   L+875   1.5%   6/30/19     30,686        30,529        30,686   

LEAS Acquisition Co Ltd.

  (g)(i)   Capital Goods   L+875   1.5%   6/30/19   27,575        37,519        30,992   

LEAS Acquisition Co Ltd.

  (f)(i)   Capital Goods   L+875   1.5%   6/30/19   $ 9,674        9,674        9,674   

Logan’s Roadhouse, Inc.

  (g)   Consumer Services   L+850 PIK
(L+850 Max PIK)
  1.0%   11/14/16     2,086        2,086        2,086   

Logan’s Roadhouse, Inc.

  (g)(p)   Consumer Services   L+850 PIK
(L+850 Max PIK)
  1.0%   11/14/16     2,963        2,963        2,963   

MB Precision Holdings LLC

  (g)   Capital Goods   L+725, 1.5% PIK
(1.5% Max PIK)
  1.3%   1/23/20     12,838        12,838        12,260   

Micronics, Inc.

  (e)(g)   Capital Goods   L+800   1.3%   12/11/19     63,624        63,413        62,351   

MMM Holdings, Inc.

  (g)   Health Care Equipment & Services   L+825   1.5%   12/12/17     8,130        8,082        7,865   

MSO of Puerto Rico, Inc.

  (g)   Health Care Equipment & Services   L+825   1.5%   12/12/17     5,911        5,876        5,718   

New Star Metals Inc.

  (e)(g)   Capital Goods   L+800   1.3%   3/20/20     37,077        37,077        38,189   

Nobel Learning Communities, Inc.

  (g)   Consumer Services   L+450   1.0%   4/27/20     59        59        59   

Nobel Learning Communities, Inc.

  (g)(p)   Consumer Services   L+450   1.0%   4/27/20     80        80        80   

Nobel Learning Communities, Inc.

  (g)   Consumer Services   L+842   1.0%   4/27/21     1,056        1,056        1,072   

North Haven Cadence Buyer, Inc.

  (g)(p)   Consumer Services   L+500   1.0%   9/2/21     938        938        938   

North Haven Cadence Buyer, Inc.

  (e)(g)   Consumer Services   L+813   1.0%   9/2/22     25,313        25,313        25,313   

North Haven Cadence Buyer, Inc.

  (g)(p)   Consumer Services   L+750   1.0%   9/2/22     5,938        5,938        5,938   

Nova Wildcat Amerock, LLC

  (g)   Consumer Durables & Apparel   L+865   1.3%   9/10/19     18,687        18,687        17,052   

 

See notes to unaudited consolidated financial statements.

 

6


Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal
Amount(c)
    Amortized
Cost
    Fair
Value(d)
 

PHRC License, LLC

  (f)(g)   Consumer Services   L+900   1.5%   8/14/20   $ 44,091      $ 44,091      $ 44,091   

Polymer Additives, Inc.

  (g)   Materials   L+888   1.0%   12/20/21     10,511        10,511        10,564   

Polymer Additives, Inc.

  (g)   Materials   L+875   1.0%   12/20/21   15,000        16,982        16,858   

PSKW, LLC

  (e)(f)(g)   Health Care Equipment & Services   L+840   1.0%   11/25/21   $ 30,000        30,000        29,391   

Roadrunner Intermediate Acquisition Co., LLC

  (e)(f)(g)   Health Care Equipment & Services   L+800   1.0%   9/22/21     36,075        36,075        36,546   

Rogue Wave Software, Inc.

  (e)(f)(g)   Software & Services   L+802   1.0%   9/25/21     31,313        31,313        30,843   

Safariland, LLC

  (e)(g)   Capital Goods   L+800   1.3%   9/20/19     187,076        187,076        189,882   

Sequential Brands Group, Inc.

  (e)(g)(i)   Consumer Durables & Apparel   L+900     7/1/22     80,652        80,652        82,265   

Sorenson Communications, Inc.

  (e)(g)   Telecommunication Services   L+575   2.3%   4/30/20     91,856        91,556        91,856   

Sports Authority, Inc.

  (g)(k)(q)   Retailing   L+600   1.5%   11/16/17     6,318        5,370        1,548   

SunGard Availability Services Capital, Inc.

  (g)   Software & Services   L+500   1.0%   3/29/19     4,382        4,192        4,140   

Sunnova Asset Portfolio 5 Holdings, LLC

  (g)   Energy   12.0% PIK
(12.0% Max PIK)
    11/14/21     4,709        4,636        4,756   

Swiss Watch International, Inc.

  (g)   Consumer Durables & Apparel   L+825   1.3%   11/8/18     11,732        11,732        10,383   

Swiss Watch International, Inc.

  (e)(g)   Consumer Durables & Apparel   L+825   1.3%   11/8/18     40,625        40,281        14,016   

Transplace Texas, LP

  (e)(f)(g)   Transportation   L+745   1.0%   9/16/21     22,973        22,973        23,088   

Transplace Texas, LP

  (g)(p)   Transportation   L+700   1.0%   9/16/21     541        541        543   

U.S. Xpress Enterprises, Inc.

  (e)(f)   Transportation   L+950, 0.0% PIK
(1.3% Max PIK)
  1.5%   5/30/19     65,162        65,162        65,162   

Vertellus Performance Chemicals LLC

  (f)(g)   Materials   L+950   1.0%   1/30/20     38,000        38,000        36,115   

VPG Group Holdings LLC

  (e)(g)   Materials   L+900   1.0%   6/30/18     62,395        62,200        61,615   

Warren Resources, Inc.

  (f)(g)(q)   Energy   L+850   1.0%   5/22/20     3,372        3,372        2,402   

Waste Pro USA, Inc.

  (e)(g)   Commercial & Professional Services   L+750   1.0%   10/15/20     94,794        94,794        96,571   

Zeta Interactive Holdings Corp.

  (e)(g)   Software & Services   L+750   1.0%   7/29/22     9,766        9,793        9,803   

Zeta Interactive Holdings Corp.

  (g)(r)   Software & Services   L+750   1.0%   7/29/22     2,857        2,830        2,861   

Zeta Interactive Holdings Corp.

  (g)(p)   Software & Services   L+750   1.0%   7/29/22     1,777        1,777        1,784   

Zeta Interactive Holdings Corp.

  (g)(p)(r)   Software & Services   L+750   1.0%   7/29/22     457        457        459   
             

 

 

   

 

 

 

Total Senior Secured Loans—First Lien

                2,224,911        2,196,095   

Unfunded Loan Commitments

                (137,196     (137,196
             

 

 

   

 

 

 

Net Senior Secured Loans—First Lien

                2,087,715        2,058,899   
             

 

 

   

 

 

 

 

See notes to unaudited consolidated financial statements.

 

7


Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal
Amount(c)
    Amortized
Cost
    Fair
Value(d)
 

Senior Secured Loans—Second Lien—27.0%

               

Alison US LLC

  (g)(i)   Capital Goods   L+850   1.0%   8/29/22   $ 4,444      $ 4,299      $ 4,114   

AP Exhaust Acquisition, LLC

  (f)   Automobiles & Components   12.0% PIK

(12.0% Max PIK)

    9/28/21     3,654        3,654        3,014   

Arena Energy, LP

  (g)   Energy   L+900, 4.0% PIK
(4.0% Max PIK)
  1.0%   1/24/21     7,875        7,875        7,840   

Ascent Resources—Utica, LLC

  (e)(f)(g)   Energy   L+950, 2.0% PIK
(2.0% Max PIK)
  1.5%   9/30/18     185,894        185,340        183,105   

ASG Technologies Group, Inc.

  (g)(s)   Software & Services   L+1100, 0.0% PIK
(6.0% Max PIK)
  1.0%   6/27/22     21,111        14,803        14,725   

Brock Holdings III, Inc.

  (g)   Energy   L+825   1.8%   3/16/18     6,923        6,889        6,576   

Byrider Finance, LLC

  (f)(g)   Automobiles & Components   L+1000, 0.5% PIK
(0.5% Max PIK)
  1.3%   8/22/20     10,034        10,034        9,934   

Compuware Corp.

  (g)   Software & Services   L+825   1.0%   12/15/22     6,550        5,960        6,185   

DEI Sales, Inc.

  (e)(f)   Consumer Durables & Apparel   L+900   1.5%   1/15/18     57,573        57,311        52,824   

EagleView Technology Corp.

  (g)   Software & Services   L+825   1.0%   7/14/23     11,538        11,389        11,500   

Eastman Kodak Co.

  (e)(f)   Consumer Durables & Apparel   L+950   1.3%   9/3/20     50,000        49,177        49,500   

Gruden Acquisition, Inc.

  (g)   Transportation   L+850   1.0%   8/18/23     15,000        14,349        11,610   

JW Aluminum Co.

  (e)(f)(g)(t)   Materials   L+850 PIK
(L+850 Max PIK)
  0.8%   11/17/20     36,209        36,191        36,481   

National Surgical Hospitals, Inc.

  (e)   Health Care Equipment & Services   L+900   1.0%   6/1/23     30,000        30,000        29,760   

Nielsen & Bainbridge, LLC

  (g)   Consumer Durables & Apparel   L+925   1.0%   8/15/21     16,675        16,473        16,175   

Paw Luxco II Sarl

  (f)(i)   Consumer Durables & Apparel   EURIBOR+950     1/29/19   16,364        20,817        13,265   

PSAV Acquisition Corp.

  (e)(g)   Technology Hardware & Equipment   L+825   1.0%   1/24/22   $ 80,000        79,098        80,000   

Spencer Gifts LLC

  (e)   Retailing   L+825   1.0%   6/29/22     30,000        29,879        24,750   

Stadium Management Corp.

  (e)   Consumer Services   L+825   1.0%   2/27/21     56,776        56,776        56,208   

Stardust Finance Holdings, Inc.

  (g)(i)   Materials   L+950   1.0%   3/13/23     2,500        2,476        2,502   
             

 

 

   

 

 

 

Total Senior Secured Loans—Second Lien

                642,790        620,068   
             

 

 

   

 

 

 

Senior Secured Bonds—7.4%

               

Advanced Lighting Technologies, Inc.

  (f)(g)   Materials   10.5%     6/1/19     78,500        77,587        19,625   

Caesars Entertainment Resort Properties, LLC

  (e)(g)   Consumer Services   11.0%     10/1/21     24,248        24,024        26,097   

FourPoint Energy, LLC

  (e)(f)   Energy   9.0%     12/31/21     74,813        72,413        74,064   

Global A&T Electronics Ltd.

  (g)(i)   Semiconductors & Semiconductor Equipment   10.0%     2/1/19     7,000        6,950        5,521   

 

See notes to unaudited consolidated financial statements.

 

8


Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal
Amount(c)
    Amortized
Cost
    Fair
Value(d)
 

Lightstream Resources Ltd.

  (f)(i)(k)(q)   Energy   9.9%     6/15/19   $ 2,112      $ 2,112      $ 1,890   

Logan’s Roadhouse, Inc.

  (g)(k)(q)   Consumer Services   4.0%, 10.5% PIK
(10.5% Max PIK)
    10/15/17     59,249        48,677        16,495   

SandRidge Energy, Inc.

  (g)(k)(q)   Energy   8.8%     6/1/20     19,500        19,458        7,069   

Sorenson Communications, Inc.

  (f)   Telecommunication Services   9.0%, 0.0% PIK
(9.0% Max PIK)
    10/31/20     19,898        19,328        17,709   
             

 

 

   

 

 

 

Total Senior Secured Bonds

                270,549        168,470   
             

 

 

   

 

 

 

Subordinated Debt—19.4%

               

Alta Mesa Holdings, LP

  (g)   Energy   9.6%     10/15/18     11,165        11,119        10,509   

Aspect Software, Inc.

  (g)   Software & Services   3.0% PIK

(3.0% Max PIK)

    5/25/23     2,941        2,941        2,941   

Aurora Diagnostics, LLC

  (e)(f)   Health Care Equipment & Services   10.8%     1/15/18     14,935        14,945        11,948   

Bellatrix Exploration Ltd.

  (g)(i)   Energy   8.5%     5/15/20     5,000        4,923        4,665   

Brooklyn Basketball Holdings, LLC

  (f)(g)   Consumer Services   L+725     10/25/19     19,873        19,873        19,773   

CEC Entertainment, Inc.

  (f)   Consumer Services   8.0%     2/15/22     5,000        5,011        5,003   

Ceridian HCM Holding, Inc.

  (f)(g)(h)   Commercial & Professional Services   11.0%     3/15/21     21,800        22,596        23,108   

EV Energy Partners, L.P.

  (f)   Energy   8.0%     4/15/19     265        243        176   

Global Jet Capital Inc.

  (g)   Commercial & Professional Services   15.0% PIK

(15.0% Max PIK)

    1/30/25     705        705        705   

Global Jet Capital Inc.

  (g)   Commercial & Professional Services   15.0% PIK

(15.0% Max PIK)

    4/30/25     4,478        4,478        4,478   

Global Jet Capital Inc.

  (g)   Commercial & Professional Services   15.0% PIK
(15.0% Max PIK)
    9/3/25     925        925        925   

Global Jet Capital Inc.

  (g)   Commercial & Professional Services   15.0% PIK
(15.0% Max PIK)
    9/29/25     871        871        871   

Global Jet Capital Inc.

  (f)(g)(i)   Commercial & Professional Services   15.0% PIK
(15.0% Max PIK)
    12/4/25     64,298        64,298        64,298   

Global Jet Capital Inc.

  (f)(g)(i)   Commercial & Professional Services   15.0% PIK
(15.0% Max PIK)
    12/9/25     10,516        10,516        10,516   

Global Jet Capital Inc.

  (f)(i)   Commercial & Professional Services   15.0% PIK
(15.0% Max PIK)
    1/29/26     5,507        5,507        5,507   

Global Jet Capital Inc.

  (g)   Commercial & Professional Services   15.0% PIK
(15.0% Max PIK)
    4/14/26     11,257        11,257        11,257   

 

See notes to unaudited consolidated financial statements.

 

9


Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal
Amount(c)
    Amortized
Cost
    Fair
Value(d)
 

Imagine Communications Corp.

  (g)   Media   12.5% PIK
(12.5% Max PIK)
    8/4/18   $ 567      $ 567      $ 567   

Jupiter Resources Inc.

  (f)(g)(i)   Energy   8.5%     10/1/22     6,425        5,479        5,417   

Mood Media Corp.

  (f)(g)(i)   Media   9.3%     10/15/20     43,135        42,368        33,699   

NewStar Financial, Inc.

  (g)(i)   Diversified Financials   8.3%, 0.0% PIK
(8.8% Max PIK)
    12/4/24     75,000        61,388        63,000   

P.F. Chang’s China Bistro, Inc.

  (f)(g)   Consumer Services   10.3%     6/30/20     11,433        11,758        10,876   

PriSo Acquisition Corp.

  (g)   Capital Goods   9.0%     5/15/23     10,155        10,041        9,876   

Sequel Industrial Products Holdings, LLC

  (f)   Commercial & Professional Services   14.5%, 2.5% PIK
(2.5% Max PIK)
    9/30/19     7,044        6,997        7,132   

Sorenson Communications, Inc.

  (f)   Telecommunication Services   13.0%, 0.0% PIK
(13.0% Max PIK)
    10/31/21     15,122        14,276        14,177   

SunGard Availability Services Capital, Inc.

  (f)(g)   Software & Services   8.8%     4/1/22     10,750        8,292        7,035   

ThermaSys Corp.

  (e)(f)(g)   Capital Goods   9.0%, 1.8% PIK
(5.0% Max PIK)
    5/3/20     137,491        137,491        110,680   

VPG Group Holdings LLC

  (e)(g)   Materials   11.0%, 2.0% PIK
(2.0% Max PIK)
    6/30/18     5,328        5,328        5,175   
             

 

 

   

 

 

 

Total Subordinated Debt

                484,193        444,314   
             

 

 

   

 

 

 

Collateralized Securities—3.4%

               

ACASC 2013-2A Class Subord. B

  (f)(g)(i)   Diversified Financials   12.2%     10/25/25     30,500        18,466        19,848   

Dryden CDO 23A Class Subord.

  (g)(i)   Diversified Financials   9.1%     7/17/23     10,000        3,265        3,248   

NewStar Clarendon 2014-1A Class D

  (g)(i)   Diversified Financials   L+435     1/25/27     1,560        1,475        1,420   

NewStar Clarendon 2014-1A Class Subord. B

  (g)(i)   Diversified Financials   14.8%     1/25/27     17,900        14,606        14,568   

Rampart CLO 2007 1A Class Subord.

  (g)(i)   Diversified Financials   0.0%     10/25/21     10,000        778        1,500   

Stone Tower CLO VI Class Subord.

  (f)(i)   Diversified Financials   21.7%     4/17/21     5,000        1,603        2,498   

Wind River CLO Ltd. 2012 1A Class E

  (g)(i)   Diversified Financials   L+525     1/15/24     5,000        4,552        5,000   

Wind River CLO Ltd. 2012 1A Class Subord. B

  (g)(i)   Diversified Financials   13.4%     1/15/24     42,504        27,085        30,597   
             

 

 

   

 

 

 

Total Collateralized Securities

                71,830        78,679   
             

 

 

   

 

 

 

 

See notes to unaudited consolidated financial statements.

 

10


Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

          Number of
Shares
    Amortized
Cost
    Fair
Value(d)
 

Equity/Other—24.7%(j)

               

5 Arches, LLC, Common Equity

  (g)(i)(k)(m)   Diversified Financials           9,475      $ 250      $ 250   

A.P. Plasman Inc., Warrants, 5/25/2026

  (g)(i)(k)   Capital Goods           4,633        2,545        2,326   

Altus Power America Holdings, LLC, Preferred Equity

  (g)   Energy           1,041,667        1,002        1,719   

Altus Power America Management, LLC, Class B Units

  (g)(k)(o)   Energy           83        —          —     

Amaya Inc., Warrants, 5/15/2024

  (g)(i)(k)   Consumer Services           2,000,000        16,832        18,020   

AP Exhaust Holdings, LLC, Common Equity

  (g)(k)(m)   Automobiles & Components           811        811        —     

Aquilex Corp., Common Equity, Class A Shares

  (g)(k)(m)   Commercial & Professional Services           15,128        1,087        3,856   

Aquilex Corp., Common Equity, Class B Shares

  (g)(k)(m)   Commercial & Professional Services           32,637        1,690        8,319   

Ascent Resources Utica Holdings, LLC, Common Equity

  (g)(k)(l)   Energy           96,800,082        29,100        21,296   

ASG Technologies Group, Inc., Common Equity

  (g)(k)(s)   Software & Services           1,689,767        36,422        80,771   

ASG Technologies Group, Inc., Warrants, 6/27/2022

  (g)(k)(s)   Software & Services           229,541        6,542        5,980   

Aspect Software, Inc., Common Equity

  (g)(k)   Software & Services           311,927        15,409        21,960   

Burleigh Point, Ltd., Warrants, 7/16/2020

  (g)(i)(k)   Retailing           3,451,216        1,898        242   

Eastman Kodak Co., Common Equity

  (e)(g)(k)   Consumer Durables & Apparel           61,859        1,203        928   

FourPoint Energy, LLC, Common Equity, Class C-II-A Units

  (g)(k)(m)   Energy           21,000        21,000        9,188   

FourPoint Energy, LLC, Common Equity, Class D Units

  (g)(k)(m)   Energy           3,937        2,601        1,742   

FourPoint Energy, LLC, Common Equity, Class E-II Units

  (g)(k)(m)   Energy           87,400        21,850        36,490   

FourPoint Energy, LLC, Common Equity, Class E-III Units

  (g)(k)(m)   Energy           70,875        17,719        31,008   

Fronton Investor Holdings, LLC, Class B Units

  (g)(m)(s)   Consumer Services           14,943        15,011        14,793   

Global Jet Capital Holdings, LP, Preferred Equity

  (f)(g)(i)(k)   Commercial & Professional Services           37,425,082        37,425        37,425   

Harvey Holdings, LLC, Common Equity

  (g)(k)   Capital Goods           2,333,333        2,333        3,967   

Imagine Communications Corp., Common Equity, Class A Units

  (g)(k)   Media           33,034        3,783        2,065   

Industrial Group Intermediate Holdings, LLC, Common Equity

  (g)(k)(m)   Materials           441,238        441        816   

JMC Acquisition Holdings, LLC, Common Equity

  (g)(k)   Capital Goods           483        483        512   

JW Aluminum Co., Common Equity

  (e)(f)(g)(k)(t)   Materials           972        —          1,311   

JW Aluminum Co., Preferred Equity

  (e)(f)(g)(k)(t)   Materials           4,499        43,507        49,341   

Leading Edge Aviation Services, Inc., Common Equity

  (f)(k)   Capital Goods           4,401        464        82   

Leading Edge Aviation Services, Inc., Preferred Equity

  (f)(k)   Capital Goods           1,303        1,303        1,303   

MB Precision Investment Holdings LLC, Class A-2 Units

  (g)(k)(m)   Capital Goods           490,213        490        74   

Micronics, Inc., Common Equity

  (g)(k)   Capital Goods           53,073        553        472   

Micronics, Inc., Preferred Equity

  (g)(k)   Capital Goods           55        553        758   

New Star Metals Inc., Common Equity

  (g)(k)   Capital Goods           741,082        750        2,446   

NewStar Financial, Inc., Warrants, 11/4/2024

  (g)(i)(k)   Diversified Financials           3,000,000        15,058        8,490   

North Haven Cadence Buyer, Inc., Common Equity

  (g)(k)   Consumer Services           1,041,667        1,042        1,042   

 

See notes to unaudited consolidated financial statements.

 

11


Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

          Number of
Shares
    Amortized
Cost
    Fair
Value(d)
 

Plains Offshore Operations Inc., Preferred Equity

  (e)(f)   Energy           52,666      $ 69,193      $ 64,668   

Plains Offshore Operations Inc., Warrants, 11/18/2019

  (e)(f)(k)   Energy           1,067,481        1,722        —     

PSAV Holdings LLC, Common Equity

  (f)   Technology Hardware & Equipment           10,000        10,000        28,000   

Safariland, LLC, Common Equity

  (f)(k)   Capital Goods           25,000        2,500        10,393   

Safariland, LLC, Preferred Equity

  (f)   Capital Goods           2,042        24,999        25,722   

Safariland, LLC, Warrants, 7/27/2018

  (f)(k)   Capital Goods           2,263        246        941   

Safariland, LLC, Warrants, 9/20/2019

  (f)(k)   Capital Goods           2,273        227        945   

Sequel Industrial Products Holdings, LLC, Common Equity

  (f)(g)(k)   Commercial & Professional Services           33,306        3,400        8,017   

Sequel Industrial Products Holdings, LLC, Preferred Equity

  (f)(g)   Commercial & Professional Services           8,000        11,891        11,897   

Sequel Industrial Products Holdings, LLC, Warrants, 9/28/2022

  (g)(k)   Commercial & Professional Services           1,293        1        155   

Sequel Industrial Products Holdings, LLC, Warrants, 5/10/2022

  (f)(k)   Commercial & Professional Services           19,388        12        2,728   

Sequential Brands Group, Inc., Common Equity

  (g)(i)(k)   Consumer Durables & Apparel           206,664        2,790        1,653   

Sorenson Communications, Inc., Common Equity

  (f)(k)   Telecommunication Services           46,163        —          38,325   

Sunnova Energy Corp., Common Equity

  (g)(k)   Energy           192,389        722        1,033   

Sunnova Energy Corp., Preferred Equity

  (g)(k)   Energy           18,182        97        98   

SWI Holdco LLC, Common Equity

  (e)(g)(k)   Consumer Durables & Apparel           950        —          —     

ThermaSys Corp., Common Equity

  (f)(k)   Capital Goods           51,813        1        —     

ThermaSys Corp., Preferred Equity

  (f)(k)   Capital Goods           51,813        5,181        —     

VPG Group Holdings LLC, Class A-2 Units

  (f)(k)   Materials           3,637,500        3,638        1,637   

Zeta Interactive Holdings Corp., Preferred Equity

  (g)(k)   Software & Services           215,662        1,714        1,892   
             

 

 

   

 

 

 

Total Equity/Other

                439,491        567,096   
             

 

 

   

 

 

 

TOTAL INVESTMENTS—171.6%

              $ 3,996,568        3,937,526   
             

 

 

   

LIABILITIES IN EXCESS OF OTHER ASSETS—(71.6%)

                  (1,643,071
             

 

 

 

NET ASSETS—100%

                $ 2,294,455   
               

 

 

 

 

(a) Security may be an obligation of one or more entities affiliated with the named company.

 

(b) Certain variable rate securities in the Company’s portfolio bear interest at a rate determined by a publicly disclosed base rate plus a basis point spread. As of September 30, 2016, the three-month London Interbank Offered Rate, or LIBOR, was 0.85%, the Euro Interbank Offered Rate, or EURIBOR, was (0.30)% and the U.S. Prime Lending Rate, or Prime, was 3.50%.

 

(c) Denominated in U.S. dollars unless otherwise noted.

 

(d) Fair value determined by the Company’s board of directors (see Note 7).

 

(e) Security or portion thereof held within Locust Street Funding LLC and is pledged as collateral supporting the amounts outstanding under the Class A Notes issued to Race Street Funding LLC pursuant to an indenture with Citibank, N.A., as trustee (see Note 8).

 

See notes to unaudited consolidated financial statements.

 

12


Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

(f) Security or portion thereof held within Race Street Funding LLC and is pledged as collateral supporting the amounts outstanding under the repurchase agreement with JPMorgan Chase Bank, N.A., London Branch (see Note 8).

 

(g) Security or portion thereof is pledged as collateral supporting the amounts outstanding under the revolving credit facility with ING Capital LLC (see Note 8).

 

(h) Position or portion thereof unsettled as of September 30, 2016.

 

(i) The investment is not a qualifying asset under the Investment Company Act of 1940, as amended. A business development company may not acquire any asset other than qualifying assets, unless, at the time the acquisition is made, qualifying assets represent at least 70% of the company’s total assets. As of September 30, 2016, 78.2% of the Company’s total assets represented qualifying assets.

 

(j) Listed investments may be treated as debt for GAAP or tax purposes.

 

(k) Security is non-income producing.

 

(l) Security held within IC American Energy Investments, Inc., a wholly-owned subsidiary of the Company.

 

(m) Security held within FSIC Investments, Inc., a wholly-owned subsidiary of the Company.

 

(n) Security held within IC Arches Investments, LLC, a wholly-owned subsidiary of the Company.

 

(o) Security held within IC Altus Investments, LLC, a wholly-owned subsidiary of the Company.

 

(p) Security is an unfunded commitment. The stated rate reflects the spread disclosed at the time of commitment and may not indicate the actual rate received upon funding.

 

(q) Asset is on non-accrual status.

 

(r) The transfer of a portion of this loan does not qualify for sale accounting under Accounting Standards Codification Topic 860, Transfers and Servicing, and therefore, the entire senior secured loan remains in the unaudited consolidated schedule of investments as of September 30, 2016 (see Note 8).

 

(s) Under the Investment Company Act of 1940, as amended, the Company generally is deemed to be an “affiliated person” of a portfolio company if it owns 5% or more of the portfolio company’s voting securities and generally is deemed to “control” a portfolio company if it owns more than 25% of the portfolio company’s voting securities or it has the power to exercise control over the management or policies of such portfolio company. As of September 30, 2016, the Company held investments in portfolio companies of which it is deemed to be an “affiliated person” but is not deemed to “control”. The following table presents certain information with respect to investments in portfolio companies of which the Company was determined to be an affiliated person of for the nine months ended September 30, 2016:

 

Portfolio Company

  Fair Value at
December 31, 2015
    Purchases and
Paid-in-kind
Interest
    Sales and
Repayments
    Accretion of
Discount
    Net Realized
Gain (Loss)
    Net Change in
Unrealized
Appreciation
(Depreciation)
    Fair Value at
September 30,
2016
    Interest
Income
    Fee
Income
    Dividend
Income
 

Senior Secured Loans—First Lien

  

           

ASG Technologies Group, Inc.

  $ 38,321      $ 15,466        —        $ 24        —        $ 1,061      $ 54,872      $ 3,416        —          —     

Senior Secured Loans—Second Lien

  

           

ASG Technologies Group, Inc.

    —        $ 14,569        —        $ 234        —        $ (78   $ 14,725      $ 676      $ 633        —     

Equity/Other

                   

ASG Technologies Group, Inc., Common Equity

  $ 77,898        —          —          —          —        $ 2,873      $ 80,771        —          —          —     

ASG Technologies Group, Inc., Warrants, 6/27/2022

    —        $ 6,542        —          —          —        $ (562   $ 5,980        —          —          —     

Fronton Investor Holdings, LLC, Class B Units

  $ 16,138        —        $ (1,874     —          —        $ 529      $ 14,793        —          —        $ 224   

 

See notes to unaudited consolidated financial statements.

 

13


Table of Contents

FS Investment Corporation

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2016

(in thousands, except share amounts)

 

 

 

(t) Under the Investment Company Act of 1940, as amended, the Company generally is deemed to “control” a portfolio company if it owns more than 25% of the portfolio company’s voting securities or it has the power to exercise control over the management or policies of such portfolio company. As of September 30, 2016, the Company held investments in one portfolio company of which it is deemed to be an “affiliated person” of and deemed to “control”. The following table presents certain information with respect to investments in portfolio companies of which the Company was deemed to be an affiliated person of and deemed to control for the nine months ended September 30, 2016:

 

Portfolio Company

  Fair Value at
December 31, 2015
    Purchases and
Paid-in-kind
Interest
    Sales and
Redemptions
    Accretion of
Discount
    Net Realized
Gain (Loss)
    Net Change in
Unrealized
Appreciation
(Depreciation)
    Fair Value at
September 30,
2016
    Interest
Income
    Fee
Income
    Dividend
Income
 

Senior Secured Loans—Second Lien

  

   

JW Aluminum Co.

  $ 32,887      $ 3,303        —        $ 1        —        $ 290      $ 36,481      $ 2,437        —          —     

Senior Secured Bonds

  

   

JW Aluminum Co.

    —        $ 8,060      $ (8,141   $ 107      $ (26     —          —        $ 103        —          —     

Equity/Other

                   

JW Aluminum Co., Common Equity

    —          —          —          —          —        $ 1,311      $ 1,311        —          —          —     

JW Aluminum Co., Preferred Equity

  $ 43,844      $ 406        —          —          —        $ 5,091      $ 49,341        —          —          —     

 

See notes to unaudited consolidated financial statements.

 

14


Table of Contents

FS Investment Corporation

Consolidated Schedule of Investments

As of December 31, 2015

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal 
Amount(c)
    Amortized
Cost
    Fair 
Value(d)
 

Senior Secured Loans—First Lien—98.4%

               

5 Arch Income Fund 2, LLC

  (g)(h)(m)   Diversified Financials   10.5%     11/18/21   $ 2,384      $ 2,437      $ 2,384   

5 Arch Income Fund 2, LLC

  (g)(h)(m)(n)   Diversified Financials   10.5%     11/18/21     35,616        35,616        35,616   

A.P. Plasman Inc.

  (e)(f)(g)(h)   Capital Goods   L+775   1.0%   12/29/19     170,437        170,437        171,716   

Aeneas Buyer Corp.

  (g)   Health Care Equipment & Services   L+500   1.0%   12/18/21     500        500        500   

Aeneas Buyer Corp.

  (g)(n)   Health Care Equipment & Services   L+500   1.0%   12/18/21     500        500        500   

Aeneas Buyer Corp.

  (e)   Health Care Equipment & Services   L+813   1.0%   12/18/21     66,000        66,000        66,000   

Aeneas Buyer Corp.

  (g)(n)   Health Care Equipment & Services   L+750   1.0%   12/18/21     13,200        13,200        13,200   

Allen Systems Group, Inc.

  (e)(g)(q)   Software & Services   L+789, 1.2% PIK
(1.2% Max PIK)
  1.0%   4/30/20     37,941        37,941        38,321   

Altus Power America, Inc.

  (g)   Energy   L+750   1.5%   10/10/21     1,724        1,724        1,707   

Altus Power America, Inc.

  (g)(n)   Energy   L+750   1.5%   10/10/21     1,401        1,401        1,387   

American Racing and Entertainment, LLC

  (e)   Consumer Services   L+800   1.0%   7/1/18     5,450        5,450        5,491   

AP Exhaust Acquisition, LLC

  (f)(g)   Automobiles & Components   L+775   1.5%   1/16/21     15,811        15,811        14,842   

Aspect Software, Inc.

  (g)   Software & Services   L+550, 0.3% PIK
(0.3% Max PIK)
  1.8%   5/7/16     1,158        1,153        1,072   

Atlas Aerospace LLC

  (g)   Capital Goods   L+807   1.0%   5/8/19     20,000        20,000        19,900   

Atlas Aerospace LLC

  (g)(n)   Capital Goods   L+750   1.0%   5/8/19     7,619        7,619        7,581   

BenefitMall Holdings, Inc.

  (g)   Commercial & Professional Services   L+725   1.0%   11/24/20     14,850        14,850        14,702   

BenefitMall Holdings, Inc.

  (g)(n)   Commercial & Professional Services   L+725   1.0%   11/24/20     5,455        5,455        5,400   

Blue Coat Holdings, Inc.

  (g)(n)   Technology Hardware & Equipment   L+350   1.0%   5/22/20     2,136        2,136        2,004   

Blueprint Sub, Inc.

  (e)   Software & Services   L+750   1.0%   5/7/21     26,891        26,891        26,805   

Blueprint Sub, Inc.

  (g)(n)   Software & Services   L+750   1.0%   5/7/21     3,509        3,509        3,498   

Blueprint Sub, Inc.

  (g)   Software & Services   L+450   1.0%   5/7/21     702        702        702   

Blueprint Sub, Inc.

  (g)(n)   Software & Services   L+450   1.0%   5/7/21     702        702        702   

Cadence Aerospace Finance, Inc.

  (g)   Capital Goods   L+525   1.3%   5/9/18     74        74        73   

Caesars Entertainment Operating Co., Inc.

  (e)(g)(h)(j)   Consumer Services   5.2%     3/1/17     12,621        12,218        10,811   

Caesars Entertainment Operating Co., Inc.

  (e)(h)(j)   Consumer Services   6.0%     3/1/17     2,363        2,308        2,030   

Caesars Entertainment Operating Co., Inc.

  (e)(f)(g)(h)(j)   Consumer Services   8.1%     3/1/17     84,594        84,262        66,163   

Caesars Entertainment Resort Properties, LLC

  (e)(g)   Consumer Services   L+600   1.0%   10/11/20     22,069        21,072        20,152   

Corel Corp.

  (e)(f)(g)(h)   Software & Services   L+825     6/7/19     134,662        134,662        135,840   

Corel Corp.

  (g)(h)(n)   Software & Services   Prime+725     6/7/18     10,000        10,000        10,000   

Corner Investment PropCo, LLC

  (e)(g)   Consumer Services   L+975   1.3%   11/2/19     42,336        42,480        41,435   

 

See notes to unaudited consolidated financial statements.

 

15


Table of Contents

FS Investment Corporation

Consolidated Schedule of Investments (continued)

As of December 31, 2015

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal 
Amount(c)
    Amortized
Cost
    Fair 
Value(d)
 

CoSentry.Net, LLC

  (e)(g)   Software & Services   L+800   1.3%   12/31/19   $ 62,331      $ 62,331      $ 63,578   

Crestwood Holdings LLC

  (g)   Energy   L+600   1.0%   6/19/19     5,166        5,150        3,349   

Eastman Kodak Co.

  (g)   Consumer Durables & Apparel   L+625   1.0%   9/3/19     10,636        10,494        9,218   

Flanders Corp.

  (e)(g)   Capital Goods   L+950   1.5%   5/14/18     33,993        33,574        34,672   

Fronton Holdings, LLC

  (e)   Consumer Services   15.0%     4/30/19     3,736        3,708        3,736   

Greystone Bridge Manager LLC

  (g)(h)   Diversified Financials   L+1050     5/1/20     3,367        3,384        3,300   

Greystone Bridge Manager LLC

  (g)(h)(n)   Diversified Financials   L+1050     5/1/20     403        403        395   

H.M. Dunn Co., Inc.

  (g)   Capital Goods   L+809   1.0%   3/26/21     1,000        1,000        990   

H.M. Dunn Co., Inc.

  (g)(n)   Capital Goods   L+725   1.0%   3/26/21     357        357        354   

Harvey Industries, Inc.

  (g)   Capital Goods   L+800   1.0%   10/1/21     32,667        32,667        32,667   

Imagine Communications Corp.

  (e)(f)(g)   Media   L+825   1.0%   4/29/20     101,367        101,367        97,566   

Imagine Communications Corp.

  (g)(n)   Media   L+825   1.0%   4/29/20     30,000        30,000        28,875   

Industrial Group Intermediate Holdings, LLC

  (g)   Materials   L+800   1.3%   5/31/20     13,954        13,954        13,814   

Industry City TI Lessor, L.P.

  (g)   Consumer Services   10.3%, 0.0% PIK
(5.3% Max PIK)
    6/30/26     25,377        25,377        26,519   

JMC Acquisition Merger Corp.

  (g)   Capital Goods   L+858   1.0%   11/6/21     5,000        5,000        5,000   

JMC Acquisition Merger Corp.

  (g)(n)   Capital Goods   L+750   1.0%   11/6/21     906        906        906   

Latham Pool Products, Inc.

  (e)   Commercial & Professional Services   L+775   1.0%   6/29/21     70,000        70,000        68,600   

Leading Edge Aviation Services, Inc.

  (e)(f)(g)   Capital Goods   L+875   1.5%   6/30/19     31,983        31,757        31,183   

LEAS Acquisition Co Ltd.

  (g)(h)   Capital Goods   L+875   1.5%   6/30/19   28,738        39,110        30,424   

LEAS Acquisition Co Ltd.

  (f)(h)   Capital Goods   L+875   1.5%   6/30/19   $ 10,083        10,083        9,830   

MB Precision Holdings LLC

  (g)   Capital Goods   L+725   1.3%   1/23/20     12,855        12,855        12,726   

Micronics, Inc.

  (e)(g)   Capital Goods   L+800   1.3%   12/11/19     64,110        63,843        63,148   

MMM Holdings, Inc.

  (g)   Health Care Equipment & Services   L+825   1.5%   12/12/17     8,414        8,338        3,954   

MSO of Puerto Rico, Inc.

  (g)   Health Care Equipment & Services   L+825   1.5%   12/12/17     6,117        6,061        2,874   

New Star Metals Inc.

  (e)(g)   Capital Goods   L+800   1.3%   3/20/20     40,250        40,250        40,250   

Nobel Learning Communities, Inc.

  (g)   Consumer Services   L+845   1.0%   4/27/21     1,056        1,056        1,052   

Nobel Learning Communities, Inc.

  (g)   Consumer Services   L+450   1.0%   4/27/20     45        45        45   

Nobel Learning Communities, Inc.

  (g)(n)   Consumer Services   L+450   1.0%   4/27/20     94        94        94   

Nova Wildcat Amerock, LLC

  (g)   Consumer Durables & Apparel   L+330, 5.4% PIK

(5.4% Max PIK)

  1.3%   9/10/19     18,817        18,817        16,276   

PHRC License, LLC

  (f)(g)   Consumer Services   L+900   1.5%   8/14/20     44,569        44,569        44,123   

Pittsburgh Glass Works, LLC

  (e)   Automobiles & Components   L+916   1.0%   11/25/21     67,944        67,944        67,944   

Polymer Additives, Inc.

  (g)   Materials   L+838   1.0%   12/20/21     10,511        10,511        10,722   

 

See notes to unaudited consolidated financial statements.

 

16


Table of Contents

FS Investment Corporation

Consolidated Schedule of Investments (continued)

As of December 31, 2015

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal 
Amount(c)
    Amortized
Cost
    Fair 
Value(d)
 

PSKW, LLC

  (e)(f)(g)   Health Care Equipment & Services   L+842   1.0%   11/25/21   $ 30,000      $ 30,000      $ 30,020   

Reddy Ice Corp.

  (g)   Food, Beverage & Tobacco   L+550   1.3%   5/1/19     321        319        264   

Roadrunner Intermediate Acquisition Co., LLC

  (e)(f)(g)   Health Care Equipment & Services   L+800   1.0%   9/22/21     36,769        36,769        36,655   

Rogue Wave Software, Inc.

  (e)(f)(g)   Software & Services   L+804   1.0%   9/25/21     31,313        31,313        30,921   

Safariland, LLC

  (e)(g)   Capital Goods   L+800   1.3%   9/20/19     193,376        193,376        196,277   

Sequential Brands Group, Inc.

  (e)(g)(h)   Consumer Durables & Apparel   L+825     12/4/21     80,000        80,000        79,200   

Shell Topco L.P.

  (g)   Materials   L+750   1.5%   9/28/18     30,000        29,768        30,075   

Smile Brands Group Inc.

  (g)   Health Care Equipment & Services   L+650, 1.3% PIK
(1.5% Max PIK)
  1.3%   8/16/19     20,063        19,768        14,571   

Sorenson Communications, Inc.

  (e)(g)   Telecommunication Services   L+575   2.3%   4/30/20     92,560        92,208        92,792   

Sports Authority, Inc.

  (g)   Retailing   L+600   1.5%   11/16/17     6,318        6,321        2,069   

Stallion Oilfield Holdings, Inc.

  (g)   Energy   L+675   1.3%   6/19/18     4,760        4,735        2,580   

SunGard Availability Services Capital, Inc.

  (g)   Software & Services   L+500   1.0%   3/29/19     4,424        4,177        3,860   

Sunnova Asset Portfolio 5 Holdings, LLC

  (g)   Energy   12.0% (12.0%
Max PIK)
    11/14/21     7,217        7,080        7,055   

Sunnova Asset Portfolio 5 Holdings, LLC

  (g)(n)   Energy   12.0% (12.0%
Max PIK)
    11/14/21     207        207        202   

Swiss Watch International, Inc.

  (e)(g)   Consumer Durables & Apparel   L+725   1.3%   11/8/18     41,000        40,552        25,420   

Transplace Texas, LP

  (e)(f)   Transportation   L+747   1.0%   9/16/21     20,000        20,000        19,825   

U.S. Xpress Enterprises, Inc.

  (e)(f)   Transportation   L+1000, 0.0% PIK

(1.5% Max PIK)

  1.5%   5/30/19     66,546        66,546        66,546   

Vertellus Performance Chemicals LLC

  (f)(g)   Materials   L+950   1.0%   1/30/20     38,000        38,000        35,940   

VPG Group Holdings LLC

  (e)(g)   Materials   L+900   1.0%   6/30/18     63,695        63,541        62,421   

Warren Resources, Inc.

  (f)(g)   Energy   L+850   1.0%   5/22/20     3,372        3,372        2,748   

Waste Pro USA, Inc.

  (e)(f)(g)   Commercial & Professional Services   L+750   1.0%   10/15/20     86,020        86,020        87,310   

Waste Pro USA, Inc.

  (g)(n)   Commercial & Professional Services   L+750   1.0%   10/15/20     9,444        9,444        9,586   

Zeta Interactive Holdings Corp.

  (e)(g)   Software & Services   L+750   1.0%   7/9/21     10,337        10,337        10,325   

Zeta Interactive Holdings Corp.

  (g)(n)   Software & Services   L+750   1.0%   7/9/21     2,234        2,234        2,232   
             

 

 

   

 

 

 

Total Senior Secured Loans—First Lien

                2,372,202        2,297,612   

Unfunded Loan Commitments

                (123,783     (123,783
             

 

 

   

 

 

 

Net Senior Secured Loans—First Lien

                2,248,419        2,173,829   
             

 

 

   

 

 

 

 

See notes to unaudited consolidated financial statements.

 

17


Table of Contents

FS Investment Corporation

Consolidated Schedule of Investments (continued)

As of December 31, 2015

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal 
Amount(c)
    Amortized
Cost
    Fair 
Value(d)
 

Senior Secured Loans—Second Lien—28.3%

               

AdvancePierre Foods, Inc.

  (e)(g)   Food, Beverage & Tobacco   L+825   1.3%   10/10/17   $ 10,556      $ 10,491      $ 10,384   

Alison US LLC

  (g)(h)   Capital Goods   L+850   1.0%   8/29/22     4,444        4,286        3,611   

American Racing and Entertainment, LLC

  (f)   Consumer Services   12.0%     7/1/18     5,800        5,688        5,836   

AP Exhaust Acquisition, LLC

  (f)   Automobiles & Components   12.0%, 0.0% PIK
(12.0% Max PIK)
    9/28/21     3,243        3,243        2,959   

Arena Energy, LP

  (g)   Energy   L+1000   1.0%   1/24/21     5,000        5,000        4,604   

Ascent Resources—Utica, LLC

  (e)(f)(g)   Energy   L+950, 2.0% PIK
(2.0% Max PIK)
  1.5%   9/30/18     183,088        182,329        163,864   

Brock Holdings III, Inc.

  (g)   Energy   L+825   1.8%   3/16/18     6,923        6,874        5,331   

Byrider Finance, LLC

  (f)(g)   Automobiles & Components   L+1000   1.3%   8/22/20     10,000        10,000        9,800   

Compuware Corp.

  (g)   Software & Services   L+825   1.0%   12/15/22     6,550        5,893        5,928   

DEI Sales, Inc.

  (e)(f)   Consumer Durables & Apparel   L+900   1.5%   1/15/18     57,500        57,121        55,344   

EagleView Technology Corp.

  (g)   Software & Services   L+825   1.0%   7/14/23     11,538        11,373        11,063   

Eastman Kodak Co.

  (e)(f)   Consumer Durables & Apparel   L+950   1.3%   9/3/20     50,000        49,060        43,250   

Gruden Acquisition, Inc.

  (g)   Transportation   L+850   1.0%   8/18/23     15,000        14,281        14,288   

JW Aluminum Co.

  (e)(f)(g)(r)   Materials   L+850   0.8%   11/17/20     32,887        32,887        32,887   

National Surgical Hospitals, Inc.

  (e)   Health Care Equipment & Services   L+900   1.0%   6/1/23     30,000        30,000        29,092   

Nielsen & Bainbridge, LLC

  (g)   Consumer Durables & Apparel   L+925   1.0%   8/15/21     16,675        16,450        16,425   

Paw Luxco II Sarl

  (f)(h)   Consumer Durables & Apparel   EURIBOR+950     1/29/19   16,364        20,535        12,460   

PSAV Acquisition Corp.

  (e)(g)   Technology Hardware & Equipment   L+825   1.0%   1/24/22   $ 80,000        79,008        79,600   

Spencer Gifts LLC

  (e)(g)   Retailing   L+825   1.0%   6/29/22     60,000        59,723        60,300   

Stadium Management Corp.

  (e)   Consumer Services   L+825   1.0%   2/27/21     57,500        57,500        57,788   
             

 

 

   

 

 

 

Total Senior Secured Loans—Second Lien

                661,742        624,814   
             

 

 

   

 

 

 

Senior Secured Bonds—10.9%

               

Advanced Lighting Technologies, Inc.

  (f)(g)   Materials   10.5%     6/1/19     78,500        77,390        38,661   

Aspect Software, Inc.

  (f)(g)   Software & Services   10.6%     5/15/17     8,500        8,424        6,981   

Avaya Inc.

  (e)(f)(g)   Technology Hardware & Equipment   10.5%     3/1/21     48,800        44,622        16,714   

Caesars Entertainment Resort Properties, LLC

  (e)(g)   Consumer Services   11.0%     10/1/21     29,248        28,993        26,469   

FourPoint Energy, LLC

  (e)(f)   Energy   8.0%     12/31/20     92,531        89,745        71,943   

FourPoint Energy, LLC

  (f)(n)   Energy   8.0%     12/31/20     5,906        5,877        4,592   

Global A&T Electronics Ltd.

  (g)(h)   Semiconductors & Semiconductor Equipment   10.0%     2/1/19     7,000        6,936        5,530   

Lightstream Resources Ltd.

  (f)(h)   Energy   9.9%     6/15/19     2,112        2,112        1,764   

 

See notes to unaudited consolidated financial statements.

 

18


Table of Contents

FS Investment Corporation

Consolidated Schedule of Investments (continued)

As of December 31, 2015

(in thousands, except share amounts)

 

 

 

Portfolio Company(a)

  Footnotes  

Industry

  Rate(b)   Floor   Maturity   Principal 
Amount(c)
    Amortized
Cost
    Fair 
Value(d)
 

Logan’s Roadhouse, Inc.

  (f)(g)   Consumer Services   4.0%, 10.5% PIK
(10.5% Max PIK)
    10/15/17   $ 59,249      $ 47,267      $ 49,432   

SandRidge Energy, Inc.

  (g)   Energy   8.8%     6/1/20     19,500        19,457        5,953   

Sorenson Communications, Inc.

  (f)   Telecommunication Services   9.0%, 0.0% PIK
(9.0% Max PIK)
    10/31/20     19,898        19,250        18,592   
             

 

 

   

 

 

 

Total Senior Secured Bonds

                350,073        246,631   

Unfunded Bond Commitments

                (5,877     (5,877
             

 

 

   

 

 

 

Net Senior Secured Bonds

                344,196        240,754   
             

 

 

   

 

 

 

Subordinated Debt—19.8%

               

Alta Mesa Holdings, LP

  (g)   Energy   9.6%     10/15/18     11,165        11,102        3,922   

Aurora Diagnostics, LLC

  (e)(f)   Health Care Equipment & Services   10.8%     1/15/18     18,065        18,089        11,754   

Bellatrix Exploration Ltd.

  (g)(h)   Energy   8.5%     5/15/20     5,000        4,911        3,369   

Brooklyn Basketball Holdings, LLC

  (f)(g)   Consumer Services   L+725     10/25/19     19,873        19,873        19,773   

CEC Entertainment, Inc.

  (f)   Consumer Services   8.0%     2/15/22     5,000        5,012        4,756   

Ceridian HCM Holding Inc.

  (f)(g)   Commercial & Professional Services   11.0%     3/15/21     10,800        11,354        8,532   

EV Energy Partners, L.P.

  (f)   Energy   8.0%     4/15/19     265        237        132   

Flanders Corp.

  (e)(f)   Capital Goods   13.8% PIK
(13.8% Max PIK)
    5/14/18     25,666        25,569        26,693   

Flanders Corp.

  (f)(g)   Capital Goods   17.5% PIK
(17.5% Max PIK)
    5/14/18     25,754        24,651        27,750   

Global Jet Capital Inc.

  (g)   Commercial & Professional Services   15.0% PIK
(15.0% Max PIK)
    1/30/25     635        635        635   

Global Jet Capital Inc.