10-Q 1 tv492755_10q.htm FORM 10-Q

 

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

 

 

FORM 10-Q

 

 

 

(Mark One)

  x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
    For the quarterly period ended March 31, 2018
    OR
  ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
     
    COMMISSION FILE NUMBER: 1-35730

 

 

 

STELLUS CAPITAL INVESTMENT CORPORATION

( Exact Name of Registrant as Specified in Its Charter)

 

 

 

Maryland   46-0937320
(State or other Jurisdiction of
Incorporation or Organization)		   (I.R.S. Employer
Identification No.)

 

4400 Post Oak Parkway, Suite 2200
Houston, Texas 77027

(Address of Principal Executive Offices) (Zip Code)

(713) 292-5400

(Registrant’s Telephone Number, Including Area Code)

 

 

 

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

 

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

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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. (Check one):

 

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

 

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 ¨

 

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

Yes ¨ No x

 

The number of shares of the issuer’s Common Stock, $0.001 par value per share, outstanding as of May 4, 2018 was 15,953,810.

 

 

 

 

 

 

STELLUS CAPITAL INVESTMENT CORPORATION

 TABLE OF CONTENTS

 

PART I. FINANCIAL INFORMATION  
Item 1. Financial Statements 1
  Consolidated Statements of Assets and Liabilities as of March 31, 2018 (unaudited) and December 31, 2017 1
  Consolidated Statements of Operations for the three-month periods ended March 31, 2018 and March 31, 2017 (unaudited) 2
  Consolidated Statements of Changes in Net Assets for the three-month periods ended March 31, 2018 and March 31, 2017 (unaudited) 3
  Consolidated Statements of Cash Flows for the three-month periods ended March 31, 2018 and March 31, 2017 (unaudited) 4
  Consolidated Schedules of Investments as of March 31, 2018 (unaudited) and December 31 2017 5
  Notes to Unaudited Financial Statements 21
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 49
Item 3. Quantitative and Qualitative Disclosures About Market Risk 63
Item 4. Controls and Procedures 63
PART II. OTHER INFORMATION  
Item 1. Legal Proceedings 64
Item 1A. Risk Factors 64
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 64
Item 3. Defaults Upon Senior Securities 64
Item 4. Mine Safety Disclosures 64
Item 5. Other Information 64
Item 6. Exhibits 65

 

 i  

 

 

PART I — FINANCIAL INFORMATION

 

STELLUS CAPITAL INVESTMENT CORPORATION

 

CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

 

   March 31,     
   2018   December 31, 
   (unaudited)   2017 
ASSETS          
Non-controlled, affiliated investments, at fair value          
(amortized cost of $135,519 and $1,052,185, respectively)  $140,000   $990,000 
Non-controlled, non-affiliated investments, at fair value          
(amortized cost of $426,244,352 and $367,401,021, respectively)   431,159,720    370,849,772 
Cash and cash equivalents   45,494,363    25,110,718 
Receivable for sales and repayments of investments   26,891    26,891 
Interest receivable   3,787,060    2,922,204 
Other receivables   37,647    — 
Prepaid expenses   298,186    361,270 
Total Assets  $480,943,867   $400,260,855 
           
LIABILITIES          
Notes payable  $47,389,684   $47,306,488 
Credit facility payable   116,948,703    39,332,479 
SBA-guaranteed debentures   87,919,481    87,818,813 
Dividends payable   1,807,570    1,806,671 
Management fees payable   1,575,366    1,621,592 
Incentive fees payable   1,164,735    371,647 
Interest payable   683,980    1,021,173 
Unearned revenue   175,989    139,304 
Administrative services payable   361,727    327,033 
Other accrued expenses and liabilities   653,500    268,413 
Total Liabilities  $258,680,735   $180,013,613 
Commitments and contingencies (Note 7)          
Net Assets  $222,263,132   $220,247,242 
NET ASSETS          
Common Stock, par value $0.001 per share (200,000,000 and 100,000,000 shares authorized; 15,953,810 and 15,945,879 shares issued and outstanding, respectively)  $15,954   $15,946 
Paid-in capital   228,161,215    228,066,762 
Accumulated net realized loss from investments, net of cumulative dividends of $4,246,819 for both periods   (9,450,971)   (10,786,240)
Distributions in excess of net investment income   (1,382,915)   (435,794)
Net Unrealized appreciation on investments and cash equivalents, net of provision for taxes of $0 for both periods   4,919,849    3,386,568 
Net Assets  $222,263,132   $220,247,242 
Total Liabilities and Net Assets  $480,943,867   $400,260,855 
Net Asset Value Per Share  $13.93   $13.81 

 

 1 

 

 

STELLUS CAPITAL INVESTMENT CORPORATION

 

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

 

   For the   For the 
   three months   three months 
   ended   ended 
   March 31,   March 31, 
   2018   2017 
INVESTMENT INCOME          
Interest income  $10,730,748   $9,476,252 
Other income   181,033    387,728 
Total Investment Income  $10,911,781   $9,863,980 
OPERATING EXPENSES          
Management fees  $1,748,896   $1,564,528 
Valuation fees   134,410    166,089 
Administrative services expenses   351,229    309,098 
Incentive fees   968,826    1,021,227 
Professional fees   469,138    227,677 
Directors’ fees   92,000    92,000 
Insurance expense   85,697    109,252 
Interest expense and other fees   2,464,980    2,068,630 
Other general and administrative expenses   121,226    161,852 
Total Operating Expenses  $6,436,402   $5,720,353 
Net Investment Income  $4,475,379   $4,143,627 
Net Realized Gain (Loss) on Investments and Cash Equivalents  $1,335,269   $(712,051)
Net Change in Unrealized Appreciation on Investments and Cash Equivalents  $1,533,281   $2,584,583 
Benefit for taxes on unrealized gain on investments  $—   $8,593 
Net Increase in Net Assets Resulting from Operations  $7,343,929   $6,024,752 
Net Investment Income Per Share  $0.28   $0.33 
Net Increase in Net Assets Resulting from Operations Per Share  $0.46   $0.48 
Weighted Average Shares of Common Stock Outstanding   15,952,841    12,479,957 
Distributions Per Share  $0.34   $0.34 

 

 2 

 

 

STELLUS CAPITAL INVESTMENT CORPORATION

 

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (unaudited)

 

   For the   For the 
   three months   three months 
   ended   ended 
   March 31,   March 31, 
   2018   2017 
Increase in Net Assets Resulting from Operations          
Net investment income  $4,475,379   $4,143,627 
Net realized gain/(loss) on investments and cash equivalents   1,335,269    (712,051)
Net change in unrealized appreciation on investments and cash equivalents   1,533,281    2,584,583 
Benefit for taxes on unrealized appreciation  on investments   —    8,593 
Net Increase in Net Assets Resulting from Operations  $7,343,929   $6,024,752 
           
Stockholder distributions from          
Net investment income   (5,422,500)   (4,241,903)
Total Distributions  $(5,422,500)  $(4,241,903)
           
Capital share transactions          
Issuance of common stock   94,788    — 
Partial Share Redemption   (327)   — 
Net increase in net assets resulting from capital share transactions  $94,461   $— 
Total increase in net assets  $2,015,890   $1,782,849 
Net assets at beginning of period  $220,247,242   $170,881,785 
Net assets at end of period (includes $1,382,915 and $435,794 of distributions in excess of net investment income, respectively)  $222,263,132   $172,664,634 

 

 

 3 

 

 

STELLUS CAPITAL INVESTMENT CORPORATION

 

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

 

   For the   For the 
   three months   three months 
   ended   ended 
   March 31, 2018   March 31, 2017 
Cash flows from operating activities          
Net Increase in net assets resulting from operations  $7,343,929   $6,024,752 
Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities:          
Purchases of investments   (71,713,787)   (23,151,902)
Proceeds from sales and repayments of investments   15,618,134    39,279,309 
Net change in unrealized appreciation on investments   (1,533,281)   (2,584,583)
Deferred tax benefit   —    (8,593)
Increase in investments due to PIK   (152,006)   (82,119)
Amortization of premium and accretion of discount, net   (343,739)   (267,611)
Amortization of loan structure fees   66,224    122,908 
Amortization of deferred financing costs   83,196    46,669 
Amortization of loan fees on SBA-guaranteed debentures   100,668    80,211 
Net realized loss (gain) on investments   (1,335,269)   712,051 
Changes in other assets and liabilities          
Decrease (increase) in interest receivable   (864,856)   329,975 
Increase in other receivable   (37,647)   (7,294)
Decrease (increase) in prepaid expenses   63,084    (62)
Decrease in management fees payable   (46,226)   (43,767)
Increase (decrease) in incentive fees payable   793,088    (129,650)
Increase in administrative services payable   34,694    31,358 
Decrease in interest payable   (337,193)   (550,338)
Increase (decrease) in unearned revenue   36,685    (1,786)
Increase in dividend payable   899    — 
Increase in other accrued expenses and liabilities   385,087    318,964 
Net cash provided by (used in) operating activities  $(51,838,316)  $20,118,492 
Cash flows from financing activities          
Proceeds from the issuance of common stock   —    — 
Offering costs paid for common stock issued   —    (81,813)
Stockholder distributions paid   (5,327,712)   (4,241,903)
Borrowings under credit facility   86,550,000    9,000,000 
Repayments of credit facility   (9,000,000)   (22,500,000)
Partial Share Redemption   (327)   — 
Net cash provided by (used in) financing activities  $72,221,961   $(17,823,716)
Net increase in cash and cash equivalents  $20,383,645   $2,294,776 
Cash and cash equivalents balance at beginning of period   25,110,718    9,194,129 
Cash and cash equivalents balance at end of period  $45,494,363   $11,488,905 
Supplemental and non-cash financing activities          
Interest expense paid   2,512,086    2,369,181 
Excise tax paid   27,717    37,648 
Shares issued pursuant to Dividend Reinvestment Plan   94,788    — 
Conversion from debt to equity   —    864,101 

 

 4 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments

March 31, 2018

 

Investments  Footnotes  Security  Coupon  LIBOR
floor		  Cash  PIK  Initial
Investment
Date		  Maturity 

Headquarters/
Industry

  Principal
Amount/
Shares		  Amortized
Cost		  

Fair
Value (1)

   % of Net
Assets		 
                                           
Non-controlled, affiliated investments  (2)                                         
Glori Energy Production Inc.                          Houston, TX                  
Glori Energy Production, LLC Class A Common Units  (4)  Equity              2/1/2017     Energy: Oil & Gas  1,000 shares   135,519    140,000    0.06%
Subtotal Non-controlled,  affiliated investments                                 135,518    140,000    0.06%
                                              
Non-controlled, non-affiliated investments  (2)                                          
Abrasive Products & Equipment, LLC, et al                          Deer Park, TX                  
Term Loan (SBIC)  (2)(12)  Second Lien  L+10.50%  1.00%  12.80%     9/5/2014  3/5/2020  Chemicals, Plastics, & Rubber  $5,325,237  $5,277,775   $5,250,000    2.36%
APE Holdings, LLC Class A Common Units  (4)  Equity              9/5/2014        375,000 units   375,000    130,000    0.06%
Total                                 5,652,775    5,380,000    2.42%
Apex Environmental Resources Holdings, LLC                          Amsterdam, OH                  
Common Units  (4)  Equity              10/30/2015     Environmental Industries  766 shares   766    769    0.00%
Preferred Units  (4)  Equity                       766 shares   765,676    769,231    0.35%
Total                    10/30/2015            766,442    770,000    0.35%
Atmosphere Aggregator Holdings II, LP                          Atlanta, GA                  
Common Units  (4)  Equity              6/30/2015     Services: Business  254,250 units   254,250    916,490    0.41%
Atmosphere Aggregator Holdings, LP Common Units  (4)  Equity              6/30/2015        750,000 units   750,000    2,703,510    1.22%
Total                                 1,004,250    3,620,000    1.63%
ASC Communications, LLC  (7)                       Chicago, IL                  
Term Loan (SBIC)  (2)(12)  First Lien  L+6.25%  1.00%  8.13%     6/29/2017  6/29/2022  Healthcare & Pharmaceuticals  $6,462,500   6,405,939    6,462,500    2.91%
ASC Communications Holdings, LLC Class A Preferred Units (SBIC)  (2)(4)  Equity              6/29/2017        73,529 shares   500,000    570,000    0.26%
Total                                 6,905,939    7,032,500    3.17%

 

 5 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments

March 31, 2018

 

Investments  Footnotes  Security  Coupon  LIBOR
floor		  Cash  PIK  Initial
Investment
Date		  Maturity 

Headquarters/

Industry

  Principal
Amount/
Shares		  Amortized
Cost		  

Fair
Value (1)

   % of Net
Assets		 
Beneplace, LLC                          Austin TX                  
Term Loan (SBIC)  (2)(12)  Second Lien  L+10.00%  1.00%  12.30%    3/27/2017  9/27/2022  FIRE: Insurance  $5,000,000   4,913,835    5,000,000    2.25%
Beneplace Holdings, LLC Preferred Units  (4)  Equity              3/27/2017        500,000 units   500,000    510,000    0.23%
Total                                 5,413,835    5,510,000    2.48%
Binder & Binder National Social Security Disability Advocates, LLC  (8)                       Hauppauge, NY                  
Residual claim from Term Loan  (4)  Unsecured              11/7/2012     Services: Consumer  $100,000   100,000    100,000    0.04%
BW DME Acquisition, LLC                          Tempe, AZ                  
Term Loan (SBIC)  (2)(12)(13)  First Lien  L+6.00%  1.00%  10.03%     8/24/2017  8/24/2022  Healthcare & Pharmaceuticals  $16,695,804   16,232,009    16,610,000    7.47%
BW DME Holdings, LLC Class A Preferred Units  (4)  Equity              8/24/2017        1,937,261 shares   1,937,261    2,180,000    0.98%
Total                                 18,169,270    18,790,000    8.45%
C.A.R.S. Protection Plus, Inc.                          Murrysville, PA                  
Term Loan  (12)  First Lien  L+8.50%  0.50%  10.07%     12/23/2015  12/31/2020  Automotive  $98,746   97,546    98,746    0.04%
Term Loan (SBIC)  (2)(12)  First Lien  L+8.50%  0.50%  10.07%     12/23/2015  12/31/2020     $7,702,191   7,608,556    7,702,191    3.47%
CPP Holdings LLC Class A Common Units  (4)  Equity              12/23/2015        149,828 shares   149,828    210,000    0.09%
Total                                 7,855,930    8,010,937    3.60%
Catapult Learning, LLC et al                          Camden, NJ                  
Term Loan  (12)(13)  First Lien  L+6.50%  1.00%  9.69%     8/6/2015  7/16/2020  Education  $12,171,053   12,107,195    12,171,053    5.48%
Colford Capital Holdings, LLC                          New York, NY                  
Preferred Units  (4)(5)  Equity              8/20/2015     Finance  38,893 units   497,388    470,000    0.21%
Total                                            % 
Condor Borrower, LLC                          Clifton, NJ                  
Term Loan  (12)  Second Lien  L+8.75%  1.00%  10.51%     10/27/2017  4/27/2025  Services: Business  $13,750,000   13,485,438    13,480,000    6.06%
Condor Top Holdco Limited Convertible Preferred Shares  (4)  Equity              10/27/2017        500,000 shares   442,197    424,510    0.19%
Condor Holdings Limited Preferred Shares, Class B  (4)  Equity              10/27/2017        500,000 shares   57,804    55,491    0.02%
Total                                 13,985,439    13,960,001    6.27%
Dream II Holdings, LLC                          Boca Raton, FL                  
Class A Common Units  (4)  Equity              10/20/2014     Services: Consumer  250,000 units   242,304    380,000    0.17%

 

 6 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments

March 31, 2018

 

Investments  Footnotes  Security  Coupon  LIBOR
floor		  Cash  PIK  Initial
Investment
Date		  Maturity 

Headquarters/

Industry

  Principal
Amount/
Shares		  Amortized
Cost		  

Fair

Value (1)

   % of Net
Assets		 
Empirix Inc.                          Billerica, MA                  
Term Loan  (12)  Second Lien  L+9.50%  1.00%  11.25%    11/1/2013  5/1/2020  Software  $11,657,850   11,564,571    11,657,850    5.25%
Term Loan (SBIC)  (2)(12)  Second Lien  L+9.50%  1.00%  11.25%     11/1/2013  5/1/2020     $9,750,000   9,670,117    9,750,000    4.39%
Empirix Holdings I, Inc. Common Shares, Class A  (4)  Equity              11/1/2013        1,304 shares   1,304,232    772,200    0.35%
Empirix Holdings I, Inc. Common Shares, Class B  (4)  Equity              11/1/2013        1,317,406 shares   13,174    7,800    0.00%
Total                                 22,552,094    22,187,850    9.99%
Energy Labs Inc.                          Houston, TX                  
Term Loan (SBIC)  (2)(12)(13)  First Lien  L+7.00%  0.50%  12.16%     9/29/2016  9/29/2021  Energy: Oil & Gas  $8,548,387   8,405,123    8,548,387    3.85%
Energy Labs Holding Corp. Common Stock  (4)  Equity              9/29/2016        500 shares   500,000    380,000    0.17%
Total                                 8,905,123    8,928,387    4.02%
EOS Fitness OPCO Holdings, LLC                          Phoenix, AZ                  
Term Loan (SBIC)  (2)(12)  First Lien  L+8.25%  0.75%  9.92%     12/30/2014  12/30/2019  Hotel, Gaming, & Leisure  $3,150,812   3,124,893    3,150,812    1.42%
EOS Fitness Holdings, LLC Class A Preferred Units  (4)  Equity              12/30/2014        118 shares   117,670    243,750    0.11%
EOS Fitness Holdings, LLC Class B Common Units  (4)  Equity              12/30/2014        3,017 shares   3,017    6,250    0.00%
Total                                 3,245,580    3,400,812    1.53 
Fast Growing Trees, LLC  (16)                       Fort Mill, SC                  
Term Loan (SBIC)  (2)(12)  First Lien  L+7.75%  1.00%  9.54%     2/5/2018  02/05/23  Retail  $20,500,000   20,100,842    20,090,000    9.04%
SP FGT Holdings, LLC, Class A Common  (4)  Equity              2/5/2018        1,000,000 shares   1,000,000    1,000,000    0.45%
Total                                 21,100,842    21,090,000    9.49%
Fumigation Holdings, Inc.                          Liberty, MO                  
Class A Common Stock  (4)  Equity              6/30/2015     Chemicals, Plastics, & Rubber  250 shares   0    300,000    0.13%
Furniture Factory Outlet, LLC                          Fort Smith, AR                  
Term Loan  (12)  First Lien  L+9.00%  0.50%  11.30%     6/10/2016  6/10/2021  Consumer Goods: Durable  $15,405,284   15,147,399    15,405,284    6.93%
Furniture Factory Holdings, LLC Term Loan  (11)  Unsecured  11.00%           6/10/2016  2/3/2021     $122,823   122,823    122,823    0.06%
Sun Furniture Factory, LP Common Units  (4)  Equity              6/10/2016        13,445 shares   94,569    150,000    0.07%
Total                                 15,364,791    15,678,107    7.06%
GK Holdings, Inc.                          Cary, NC                  
Term Loan  (12)  Second Lien  L+10.25%  1.00%  12.55%     2/6/2015  1/30/2022  Education  $5,000,000   4,936,044    5,000,000    2.25%

 

 7 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments

March 31, 2018

 

Investments  Footnotes  Security  Coupon  LIBOR
floor		  Cash  PIK  Initial
Investment
Date		  Maturity 

Headquarters/

Industry

  Principal
Amount/
Shares		  Amortized
Cost		  

Fair

Value (1)

   % of Net
Assets		 
Good Source Solutions, Inc.                          Carlsbad, CA                  
Term Loan  (12)(13)  First Lien  L+7.25%  0.50%  12.53%    7/15/2016  7/15/2021  Beverage, Food, & Tobacco  $1,350,000   1,330,576    1,350,000    0.61%
Term Loan (SBIC)  (2)(12)(13)  First Lien  L+7.25%  0.50%  12.53%     7/15/2016  7/15/2021     $1,200,000   1,182,734    1,200,000    0.54%
Good Source Holdings, LLC Class A Preferred Units  (4)  Equity              7/15/2016        159 shares   159,375    170,000    0.08%
Good Source Holdings, LLC Class B Common Units  (4)  Equity              7/15/2016        4,482 shares   0    0    0.00%
Total                                 2,672,685    2,720,000    1.23%
Grupo HIMA San Pablo, Inc., et al                          San Juan, PR                  
Term Loan  (12)  First Lien  L+7.00%  1.50%  8.84%     2/1/2013  1/31/2018  Healthcare & Pharmaceuticals  $4,750,000   4,750,000    4,180,000    1.88%
Term Loan  (15)  Second Lien  13.75%     0.00%     2/1/2013  7/31/2018     $4,109,524   4,092,160    900,000    0.40%
Total                                 8,842,160    5,080,000    2.28%
Hostway Corporation                          Chicago, IL                  
Term Loan  (12)  Second Lien  L+4.25%  1.25%  6.13%     12/27/2013  12/13/2020  High Tech Industries  $6,750,000   6,685,113    6,010,000    2.70%
J.R. Watkins, LLC  (9)                       San Francisco, CA                  
Term Loan (SBIC)  (2)(12)  First Lien  L+6.50%  1.25%  8.80%     12/22/2017  12/22/2022  Consumer Goods: non-durable  $12,468,750   12,229,561    12,220,000    5.50%
J.R. Watkins Holdings, Inc. Class A Preferred  (4)  Equity              12/22/2017        1,000 shares   1,000,000    1,000,000    0.45%
Total                                 13,229,561    13,220,000    5.95%
ICD Intermediate Holdco 2, LLC                          San Francisco, CA                  
Term Loan (SBIC)  (2)(12)  Second Lien  L+9.00%  1.00%  11.30%     1/1/2018  7/1/2024  Finance  $10,000,000   9,805,457    9,800,000    4.41%
ICD Holdings, LLC, Class A Preferred  (4)  Equity              1/1/2018        9,962 shares   500,000    500,000    0.22%
Total                                 10,305,457    10,300,000    4.63%

 

 8 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments

March 31, 2018

 

Investments  Footnotes  Security  Coupon  LIBOR
floor		  Cash  PIK  Initial
Investment
Date		  Maturity 

Headquarters/

Industry

  Principal
Amount/
Shares		  Amortized
Cost		  

Fair

Value (1)

   % of Net
Assets		 
Kelleyamerit Holdings, Inc.                          Walnut Creek, CA                  
Term Loan  (12)(13)  First Lien  L+7.50%  1.00%  10.54%     3/30/2018  3/30/2023  Automotive  $9,750,000   9,555,000    9,560,000    4.30%
Keais Records Service, LLC                          Houston, TX                  
Term Loan  (12)  Second Lien  L+10.50%  0.50%  12.80%     6/30/2016  6/30/2022  Services: Business  $7,750,000   7,642,494    7,750,000    3.49%
Keais Holdings, LLC Class A Units  (4)  Equity              6/30/2016        148,335 units   748,239    700,000    0.31%
Total                                 8,390,733    8,450,000    3.80%
KidKraft, Inc.                          Dallas, TX                  
Term Loan  (6)  Second Lien  12.00%     11.00%  1.00%  9/30/2016  3/30/2022  Consumer Goods: Durable  $9,338,418   9,192,061    9,100,000    4.09%
Livingston International, Inc.                          Toronto, Ontario                  
Term Loan  (5)(12)  Second Lien  L+8.25%  1.25%  10.55%     4/23/2013  4/18/2020  Transportation: Cargo  $6,841,739   6,791,312    6,841,739    3.08%
Madison Logic, Inc.                          New York, NY                  
Term Loan (SBIC)  (2)(12)  First Lien  L+8.00%  0.50%  9.88%     11/30/2016  11/30/2021  Media: Broadcasting & Subscription  $4,843,750   4,806,241    4,843,750    2.18%
Madison Logic Holdings, Inc. Common Stock (SBIC)  (2)(4)  Equity              11/30/2016        5,000 shares   50,000    67,000    0.03%
Madison Logic Holdings, Inc. Series A Preferred Stock (SBIC)  (2)(4)  Equity              11/30/2016        4,500 shares   450,000    603,000    0.27%
Total                                 5,306,241    5,513,750    2.48%
Magdata Intermediate Holdings, LLC                          Austin TX                  
Term Loan  (12)  Second Lien  L+9.50%  1.00%  11.80%     10/16/2017  4/16/2024  Software  $12,500,000   12,261,274    12,380,000    5.57%
MBS Holdings, Inc.                          Birmingham, AL                  
Series E Preferred Stock  (4)  Equity              3/10/2014     Media: Broadcasting & Subscription  2,774,695 shares   1,000,000    2,734,772    1.23%
Series F Preferred Stock  (4)  Equity              3/10/2014        399,308 shares   206,682    565,228    0.25%
Total                                 1,206,682    3,300,000    1.48%
Mobileum, Inc.                          Santa Clara, CA                  
Term Loan  (12)  Second Lien  L+10.25%  0.75%  12.55%     11/1/2016  5/1/2022  Software  $9,000,000   8,856,059    9,000,000    4.05%
Mobile Acquisition Holdings, LP Class A-2 Common Units  (4)  Equity              11/1/2016        750 units   750,000    1,000,000    0.45%
Total                                 9,606,059    10,000,000    4.50%

 

 9 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments

March 31, 2018

 

Investments  Footnotes  Security  Coupon  LIBOR
floor		  Cash  PIK  Initial
Investment
Date		  Maturity 

Headquarters/

Industry

  Principal
Amount/
Shares		  Amortized
Cost		  

Fair

Value (1)

   % of Net
Assets		 
MTC Parent, L.P.                          Oak Brook, IL                  
Class A-2 Common Units  (4)  Equity              12/1/2015     Finance  750,000 shares   0    1,670,000    0.75%
National Trench Safety, LLC, et al                          Houston, TX                  
Term Loan (SBIC)  (2)  Second Lien  11.50%     11.50%     3/31/2017  3/31/2022  Construction & Building  $10,000,000   9,852,196    9,850,000    4.43%
NTS Investors, LP Class A Common Units  (4)  Equity              3/31/2017        2,335 units   500,000    340,000    0.15%
Total                                 10,352,196    10,190,000    4.58%
OGS Holdings, Inc.                          Chantilly, Virginia                  
Series A Convertible Preferred Stock  (4)  Equity              4/22/2014     Services: Government  11,521 shares   50,001    100,000    0.04%
Price for Profit, LLC  (17)                       Cleveland, OH                  
Term Loan (SBIC)  (2)(12)  First Lien  L+6.50%  1.00%  8.80%     1/31/2018  1/31/2023  Services: Business  $11,000,000   10,786,010    10,780,000    4.85%
I2P Holdings, LLC, Series A Preferred  (4)  Equity              1/31/2018        750,000 shares   750,000    750,000    0.34%
Total                                 11,536,010    11,530,000    5.19%
Protect America, Inc.                          Austin TX                  
Term Loan (SBIC)  (2)(6)(12)  Second Lien  L+9.75%  1.00%  10.06%  2.00%  8/30/2017  10/30/2020  Services: Consumer  $17,705,875   17,339,275    17,530,000    7.89%
Refac Optical Group, et al                          Blackwood, NJ                  
Revolver  (10)(12)  First Lien  L+8.00%     9.88%     11/7/2012  9/30/2018  Retail  $880,000   880,000    880,000    0.40%
Term A Loan  (12)  First Lien  L+8.00%     9.88%     11/7/2012  9/30/2018     $825,767   825,767    825,767    0.37%
Term B Loan  (6)(12)  First Lien  L+10.75%     10.88%  1.75%  11/7/2012  9/30/2018     $6,482,871   6,482,871    6,482,871    2.92%
Total                                 8,188,638    8,188,638    3.69 
Resolute Industrial, LLC  (14)                       Wheeling, IL                  
Term Loan  (12)  First Lien  L+7.62%  1.00%  9.31%     7/26/2017  7/26/2022  Capital Equipment  $3,797,222   3,738,154    3,780,000    1.70%
Term Loan (SBIC)  (2)(12)  First Lien  L+7.62%  1.00%  9.31%     7/26/2017  7/26/2022     $13,290,278   13,083,499    13,220,000    5.95%
Resolute Industrial Holdings, LLC  Class A Preferred Units  (4)  Equity              7/26/2017        601 units   750,000    900,000    0.40%
Total                                 17,571,653    17,900,000    8.05%
Roberts-Gordon, LLC                          Buffalo, NY                  
Term Loan  (12)  Second Lien  L+10.00%  1.00%  12.30%     6/30/2017  1/1/2022  Construction & Building  $7,200,000   7,074,687    7,160,000    3.22%
Specified Air Solutions, LLC Class A Common Unites  (4)  Equity              6/30/2017        3,846 shares   500,045    430,000    0.19%
Total                                 7,574,732    7,590,000    3.41%
Sitel Worldwide Corporation                          Nashville, TN                  
Term Loan  (12)  Second Lien  L+9.50  1.00%  11.25%     9/24/2015  9/18/2022  High Tech Industries  $10,000,000   9,854,786    10,000,000    4.50%
Skopos Financial, LLC                          Irving, TX                  
Term Loan  (5)  Unsecured  12.00%     12.00%     1/31/2014  1/31/2019  Finance  $19,500,000   19,413,984    19,310,000    8.69%
Skopos Financial Group, LLC Series A Common Units  (4)(5)  Equity              1/31/2014        1,120,684 units   1,162,544    730,000    0.33%
Total                                 20,576,528    20,040,000    9.02%

 

 10 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments

March 31, 2018

 

Investments  Footnotes  Security  Coupon  LIBOR
floor		  Cash  PIK  Initial
Investment
Date		  Maturity 

Headquarters/

Industry

  Principal
Amount/
Shares		  Amortized
Cost		  

Fair

Value (1)

   % of Net
Assets		 
SPM Capital, LLC                          Bloomington, MN                  
Term Loan  (12)  First Lien  L+6.50  1.50%  8.38%     12/10/2012  10/31/2018  Healthcare & Pharmaceuticals  $5,130,946   5,130,946    5,130,946    2.31%
SQAD, LLC                          Tarrytown, NY                  
Term Loan (SBIC)  (2)(12)  First Lien  L+6.50  1.00%  8.81%     12/22/2017  12/22/2022  Media: Broadcasting & Subscription  $14,961,500   14,884,999    14,880,000    6.69%
SQAD Holdco, Inc. Preferred Shares, Series A (SBIC)  (2)(4)  Equity              10/31/2013        3,598 shares   156,001    257,043    0.12%
SQAD Holdco, Inc. Common Shares (SBIC)  (2)(4)  Equity              10/31/2013        5,800 shares   62,485    102,957    0.05%
Total                                 15,103,485    15,240,000    6.86%
TechInsights, Inc.                          Ottawa, Ontario                  
Term Loan  (5)(12)(13)  First Lien  L+6.50%  1.00%  9.30%     8/16/2017  8/16/2022  High Tech Industries  $20,000,000   19,549,367    19,800,000    8.91%
Time Manufacturing Acquisition, LLC                          Waco, TX                  
Term Loan  (6)  Unsecured  11.50%     10.75%  0.75%  2/3/2017  8/3/2023  Capital Equipment  $6,385,182   6,274,450    6,320,000    2.84%
Time Manufacturing Investments, LLC Class A Common  Units  (4)  Equity              2/3/2017        5,000 units   500,000    360,000    0.16%
Total                                 6,774,450    6,680,000    3.00%
TFH Reliability, LLC                          Houston, TX                  
Term Loan (SBIC)  (2)(12)  Second Lien  L+10.75%  0.50%  13.05%     10/20/2016  4/21/2022  Chemicals, Plastics, & Rubber  $5,875,000   5,780,283    5,875,000    2.64%
TFH Reliability Group, LLC Class A Common Units  (4)  Equity              10/20/2016        250,000 shares   250,000    510,000    0.23%
Total                                 6,030,283    6,385,000    2.87%
U.S. Auto Sales, Inc. et al                          Lawrenceville, GA                  
Term Loan  (5)(12)  Second Lien  L+10.50%  1.00%  12.17%     6/8/2015  6/8/2020  Finance  $4,500,000   4,477,246    4,500,000    2.02%
USASF Blocker II, LLC Common Units  (4)(5)  Equity              6/8/2015        441 units   441,000    420,000    0.19%
USASF Blocker III, LLC Series C Preferred Units  (4)(5)  Equity              2/13/2018        50 Units   50,000    100,000    0.04 
USASF Blocker LLC Common Units  (4)(5)  Equity              6/8/2015        9,000 units   9,000    10,000    0.00%
Total                                 4,977,246    5,030,000    2.25%

 

 11 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments

March 31, 2018

 

Investments  Footnotes  Security  Coupon  LIBOR
floor		  Cash  PIK  Initial
Investment
Date		  Maturity 

Headquarters/
Industry

  Principal
Amount/
Shares		  Amortized
Cost		  

Fair
Value (1)

   % of Net
Assets		 
VRI Intermediate Holdings, LLC et al                          Franklin, OH                  
Term Loan (SBIC)  (2)(12)  Second Lien  L+9.25%  1.00%  11.55%    5/31/2017  10/31/2020  Healthcare & Pharmaceuticals  $9,000,000   8,857,928    8,910,000    4.01%
VRI Ultimate Holdings, LLC Class A Preferred Units  (4)  Equity              5/31/2017        326,797 shares   500,000    550,000    0.25%
Total                                 9,357,928    9,460,000    4.26%
Wise Holding Corporation                          Salt Lake City, UT                  
Term Loan  (12)  Unsecured  L+11.00%  1.00%  13.30%     6/30/2016  12/31/2021  Beverage, Food, & Tobacco  $1,250,000   1,235,911    880,000    0.40%
WCI Holdings LLC Class A Preferred Units  (4)  Equity              6/30/2016        56 units   55,550    0    0.00%
WCI Holdings LLC Class B Common  Units  (4)  Equity              6/30/2016        3,044 units   3,044    0    0.00%
Total                                 1,294,505    880,000    0.40%
Zemax, LLC                          Redmond, WA                  
Term Loan (SBIC)  (2)(12)  Second Lien  L+10.00%  1.00%  11.88%     10/23/2014  4/23/2020  Software  $1,900,000   1,882,745    1,900,000    0.85%
Zemax Software Holdings, LLC Preferred Units (SBIC)  (2)(4)  Equity              10/23/2014        24,500 units   5,000    13,200    0.01%
Zemax Software Holdings, LLC Common Units (SBIC)  (2)(4)  Equity              10/23/2014        5,000 shares   245,000    646,800    0.29%
Total                                 2,132,745    2,560,000    1.15%
                                              
Total Non-controlled, non-affiliated investments                                 426,244,352    431,159,720    193.99%
Net Investments                                 426,379,871    431,299,720    194.05%
LIABILITIES IN EXCESS OF OTHER ASSETS                                      (209,036,588)   (94.05)%
NET ASSETS                                      222,263,132    100.00%

 

 12 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments

March 31, 2018

 

(1)See Note 1 of the Notes to the Consolidated Financial Statements for a discussion of the methodologies used to value securities in the portfolio.

 

(2)Investments held by the SBIC subsidiary, which include $12,433,557 of cash and $196,848,571 of investments (at par) are excluded from the obligations to the lenders of the Credit Facility. The Company’s obligations to the lenders of the Credit Facility, as defined in Note 9, are secured by a first priority security interest in all investments and cash and cash equivalents, except for investments held by the SBIC Subsidiary.

 

(3)These loans have LIBOR or Euro Floors that are higher than the current applicable LIBOR or Euro rates; therefore, the floors are in effect.

 

(4)Security is non-income producing.

 

(5)The investment is not a qualifying asset under the Investment Company Act of 1940, as amended. The Company may not acquire any non-qualifying assets unless, at the time of the acquisition, qualifying assets represent at least 70% of the Company’s total assets. Qualifying assets represent approximately 86% of the Company’s total assets as of March 31, 2018.

 

(6)Represents a PIK security. At the option of the issuer, interest can be paid in cash or cash and PIK. The percentage of PIK shown is the maximum PIK that can be elected by the issuer.

 

(7)Excluded from the investment is an undrawn revolver commitment in an amount not to exceed $666,666, with an interest rate of LIBOR plus 6.25% and a maturity of June 29, 2022. This investment is accruing an unused commitment fee of 0.50% per annum.

 

(8)In the fourth quarter of 2016, Binder & Binder National Social Security Disability, emerged from Chapter 11 Bankruptcy in the U.S. Bankruptcy Court, Southern District of New York. The investment’s fair value has been adjusted to reflect the court-approved unsecured claim distribution proceeds that have been awarded to the Company. As of this time, the Company does not expect to receive any additional repayment other than the court awarded amount.

 

(9)Excluded from the investment is an undrawn revolver commitment in an amount not to exceed $1,750,000, with an interest rate of LIBOR plus 6.50% and a maturity of December 22, 2022. This investment is accruing an unused commitment fee of 0.50% per annum.

 

(10)Excluded from the investment is an undrawn commitment in an amount not to exceed $520,000, with an interest rate of LIBOR plus 8.00% and a maturity of September 30, 2018. This investment is accruing an unused commitment fee of 0.50% per annum.

 

(11)Interest compounds annually on this loan at a rate of 11%. The interest does not increase the principal balance.

 

(12)These loans have LIBOR floors that are lower than the applicable LIBOR rates; therefore, the floors are not in effect.

 

(13)These loans are last-out term loans with contractual rates higher than the applicable LIBOR rates; therefore, the floors are not in effect.

 

(14)Excluded from the investment is an undrawn commitment in an amount not to exceed $5,750,000, with an interest rate of LIBOR plus 7.62% and a maturity of July 26, 2022. This investment is accruing an unused commitment fee of 0.50% per annum.

 

(15)Investment has been on non-accrual since November 1, 2017.

 

(16)Excluded from the investment is an undrawn commitment in an amount not to exceed $1,000,000, with an interest rate of LIBOR plus 7.75% and a maturity of February 5, 2023. This investment is accruing an unused commitment fee of 0.50% per annum.

 

(17)Excluded from the investment is an undrawn commitment in an amount not to exceed $1,500,000, with an interest rate of LIBOR plus 6.50% and a maturity of January 31, 2023. This investment is accruing an unused commitment fee of 0.50% per annum.

 

Abbreviation Legend
PIK — Payment-In-Kind
L — LIBOR
Euro — Euro Dollar

 

 13 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments
December 31, 2017

  

Investments  Footnotes  Security  Coupon    LIBOR
floor		   Cash  

PIK

     Initial Investment Date     Maturity  Headquarters/
Industry		  Principal
Amount/
Shares		   Amortized
Cost		   Fair
Value(1)		   % of
Net
Assets		 
Non-controlled, affiliated investments  (2)                                                            
Glori Energy Production Inc.                                          Houston, TX                    
Glori Energy Production, LLC Class A Common Units  (4)  Equity                           2/1/2017        Energy: Oil & Gas   1,000 shares   $1,052,185   $990,000    0.45%
Subtotal Non-controlled, affiliated investments                                                   1,052,185    990,000    0.45%
Non-controlled, non-affiliated investments  (2)                                                            
Abrasive Products & Equipment, LLC, et al                                        Deer Park, TX                    
Term Loan (SBIC)  (2)(12)  Second Lien    L+10.50%     1.00%   12.20%          9/5/2014     3/5/2020  Chemicals, Plastics, & Rubber  $5,325,237    5,272,397    5,220,000    2.37%
APE Holdings, LLC Class A Common Units  (4)  Equity                           9/5/2014            375,000 units    375,000    180,000    0.08%
Total                                                   5,647,397    5,400,000    2.45%
Apex Environmental Resources Holdings,
LLC		                                          Amsterdam, OH                    
Common Units  (4)  Equity                           10/30/2015        Environmental Industries   766 shares    766    579    0.00%
Preferred Units  (4)  Equity                           10/30/2015            766 shares    765,676    579,421    0.26%
Total                                                   766,442    580,000    0.26%
Atmosphere Aggregator Holdings II, LP                                          Atlanta, GA                    
Common Units  (4)  Equity                           6/30/2015        Services: Business   254,250 units    254,250    820,284    0.37%
Atmosphere Aggregator Holdings, LP Common Units  (4)  Equity                           6/30/2015            750,000 units    750,000    2,419,714    1.10%
Total                                                   1,004,250    3,239,998    1.47%
ASC Communications, LLC  (7)                                       Chicago, IL                    
Term Loan (SBIC)  (2)(12)  First Lien    L+6.25%     1.00%   7.94%          6/29/2017     6/29/2022  Healthcare & Pharmaceuticals  $6,879,167    6,816,044    6,879,167    3.12%
ASC Communications Holdings, LLC Class A Preferred Units (SBIC)  (2)(4)  Equity                           6/29/2017            73,529 shares    500,000    620,000    0.28%
Total                                                   7,316,044    7,499,167    3.40%
Beneplace, LLC                                          Austin TX                    
Term Loan (SBIC)  (2)(12)  Second
Lien		    L+10.00%     1.00%   11.70%          3/27/2017     9/27/2022  Insurance  $5,000,000    4,910,226    5,000,000    2.27%
Beneplace Holdings, LLC Preferred Units  (4)  Equity                           3/27/2017            500,000 units    500,000    500,000    0.23%
Total                                                   5,410,226    5,500,000    2.50%
Binder & Binder National Social Security Disability Advocates, LLC  (8)                                       Hauppauge, NY                    
Residual claim from Term Loan  (4)  Unsecured                           11/7/2012        Services: Consumer  $400,000    400,000    380,000    0.17%
BW DME Acquisition, LLC                                          Tempe, AZ                    
Term Loan (SBIC)  (2)(12)(13)  First Lien    L+6.00%     1.00%   9.43%          8/24/2017     8/24/2022  Healthcare & Pharmaceuticals  $9,550,000    9,281,016    9,310,000    4.23%
BW DME Holdings, LLC Class A Preferred Units  (4)  Equity                           8/24/2017            1,000,000 shares    1,000,000    1,110,000    0.50%
Total                                                   10,281,016    10,420,000    4.73%

 

 14 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments – (continued)
December 31, 2017 

 

Investments  Footnotes  Security  Coupon    LIBOR
floor		   Cash    PIK     Initial Investment Date    Maturity  Headquarters/
Industry		  Principal
Amount/
Shares		   Amortized
Cost		   Fair
Value(1)		   % of
Net
Assets		 
C.A.R.S. Protection Plus, Inc.                                          Murrysville, PA                    
Term Loan  (12)  First Lien    L+8.50%     0.50%   9.74%           12/23/2015    12/31/2020  Automotive  $98,746   $97,451   $98,746    0.04%
Term Loan (SBIC)  (2)(12)  First Lien    L+8.50%     0.50%   9.74%           12/23/2015    12/31/2020     $7,702,191    7,601,191    7,700,000    3.50%
CPP Holdings LLC Class A Common Units  (4)  Equity                            12/23/2015           149,828 shares    149,828    260,000    0.12%
Total                                                   7,848,470    8,058,746    3.66%
Catapult Learning, LLC et al                                          Camden, NJ                    
Term Loan  (13)  First Lien    L+6.50%     1.00%   9.30%           8/6/2015    7/16/2020  Education  $12,335,526    12,264,670    12,335,526    5.60%
Colford Capital Holdings, LLC                                          New York, NY                    
Preferred Units  (4)(5)  Equity                            8/20/2015       Finance   38,893 units    497,388    470,000    0.21%
Condor Borrower, LLC                                          Clifton, NJ                    
Term Loan  (12)  Second Lien    L+8.75%     1.00%   10.12%           10/27/2017    4/27/2025  Services: Business  $13,750,000    13,479,122    13,480,000    6.12%
Condor Top Holdco Limited Convertible Preferred Shares  (4)  Equity                            10/27/2017           500,000 shares    442,197    442,197    0.20%
Condor Holdings Limited Preferred Shares, Class B  (4)  Equity                            10/27/2017           500,000 shares    57,804    57,804    0.03%
Total                                                   13,979,123    13,980,001    6.35%
Douglas Products & Packaging Company, LLC                                          Liberty, MO                    
Term Loan (SBIC)  (2)(12)  Second Lien    L+10.50%     0.50%   12.20%           6/30/2015    12/31/2020  Chemicals, Plastics, & Rubber  $9,000,000    8,902,087    9,000,000    4.09%
Fumigation Holdings, Inc. Class A Common Stock  (4)  Equity                            6/30/2015           250 shares    250,000    530,000    0.24%
Total                                                   9,152,087    9,530,000    4.33%
Dream II Holdings, LLC                                          Boca Raton, FL                    
Class A Common Units  (4)  Equity                            10/20/2014       Services: Consumer   250,000 units    242,304    420,000    0.19%
Empirix Inc.                                          Billerica, MA                    
Term Loan  (12)  Second Lien    L+9.50%     1.00%   10.88%           11/1/2013    5/1/2020  Software  $11,657,850    11,554,734    11,657,850    5.29%
Term Loan (SBIC)  (2)(12)  Second Lien    L+9.50%     1.00%   10.88%           11/1/2013    5/1/2020     $9,750,000    9,662,051    9,750,000    4.43%
Empirix Holdings I, Inc. Common Shares, Class A  (4)  Equity                            11/1/2013           1,304 shares    1,304,232    831,600    0.38%
Empirix Holdings I, Inc. Common Shares, Class B  (4)  Equity                            11/1/2013           1,317,406 shares    13,174    8,400    0.00%
Total                                                   22,534,191    22,247,850    10.10%
Energy Labs Inc.                                          Houston, TX                    
Term Loan (SBIC)  (2)(13)  First Lien    L+7.00%     0.50%   11.58%           9/29/2016    9/29/2021  Energy: Oil & Gas  $5,300,000    5,214,783    5,300,000    2.41%
Energy Labs Holding Corp. Common Stock  (4)  Equity                            9/29/2016           500 shares    500,000    410,000    0.19%
Total                                                   5,714,783    5,710,000    2.60%
EOS Fitness OPCO Holdings, LLC                                          Phoenix, AZ                    
Term Loan (SBIC)  (2)(12)  First Lien    L+8.25%     0.75%   9.62%           12/30/2014    12/30/2019  Hotel, Gaming, & Leisure  $3,193,890    3,164,255    3,190,000    1.45%
EOS Fitness Holdings, LLC Class A Preferred Units  (4)  Equity                            12/30/2014           118 shares    117,670    224,250    0.10%

 

 15 

 

 

Stellus Capital Investment Corporation
 
Consolidated Schedule of Investments – (continued)
December 31, 2017

 

Investments  Footnotes  Security  Coupon   LIBOR
floor		   Cash   PIK    Initial
Investment
Date		    Maturity  Headquarters/
Industry		  Principal
Amount/
Shares		   Amortized
Cost		   Fair
Value(1)		   % of
Net
Assets		 
EOS Fitness Holdings, LLC Class B Common Units  (4)  Equity                       12/30/2014           3,017 shares   $3,017   $5,750    0.00%
Total                                              3,284,942    3,420,000    1.55 
Furniture Factory Outlet, LLC                                     Fort Smith, AR                    
Term Loan  (12)  First Lien   L+9.00%    0.50%   10.70%        6/10/2016    6/10/2021  Consumer Goods: Durable  $7,288,484    7,180,489    7,288,484    3.31%
Furniture Factory Holdings, LLC Term Loan  (11)  Unsecured   11.00%                   6/10/2016    2/3/2021     $122,823    122,823    120,000    0.05%
Sun Furniture Factory, LP Common Units  (4)  Equity                       6/10/2016           13,445 shares    94,569    210,000    0.10%
Total                                              7,397,881    7,618,484    3.46%
GK Holdings, Inc.                                     Cary, NC                    
Term Loan  (12)  Second
Lien		   L+10.25%    1.00%   11.94%        2/6/2015    1/30/2022  Education  $5,000,000    4,932,726    5,000,000    2.27%
Good Source Solutions, Inc.                                     Carlsbad, CA                    
Term Loan  (13)  First Lien   L+7.25%    0.50%   11.96%        7/15/2016    7/15/2021  Beverage, Food, & Tobacco  $1,350,000    1,329,398    1,350,000    0.61%
Term Loan (SBIC)  (2)(13)  First Lien   L+7.25%    0.50%   11.96%        7/15/2016    7/15/2021     $1,200,000    1,181,687    1,200,000    0.54%
Good Source Holdings, LLC Class A Preferred Units  (4)  Equity                       7/15/2016           159 shares    159,375    150,000    0.07%
Good Source Holdings, LLC Class B Common Units  (4)  Equity                       7/15/2016           4,482 shares    0    0    0.00%
Total                                              2,670,460    2,700,000    1.22%
Grupo HIMA San Pablo, Inc., et al                                     San Juan, PR                    
Term Loan  (3)  First Lien   L+7.00%    1.50%   8.50%        2/1/2013    1/31/2018  Healthcare & Pharmaceuticals  $4,750,000    4,748,168    4,180,000    1.90%
Term Loan  (15)  Second Lien   13.75%         0.00%        2/1/2013    7/31/2018     $4,109,524    4,079,696    900,000    0.41%
Total                                              8,827,864    5,080,000    2.31%
Hostway Corporation                                     Chicago, IL          &nbs