N-Q 1 nqfhitpe08318.htm nqfhitpe08318.htm - Generated by SEC Publisher for SEC Filing

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

 

 

FORM N-Q

 

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

 MANAGEMENT INVESTMENT COMPANY

 

Investment Company Act file number 811-01608

 

Franklin High Income Trust

(Exact name of registrant as specified in charter)

 

One Franklin Parkway, San Mateo, CA  94403-1906

(Address of principal executive offices) (Zip code)

 

Craig S. Tyle, One Franklin Parkway, San Mateo, CA  94403-1906

(Name and address of agent for service)

 

Registrant's telephone number, including area code: _650 312-2000

 

Date of fiscal year end: _5/31

 

Date of reporting period: 8/31/18

 

 

Item 1. Schedule of Investments.

 

  FRANKLIN HIGH INCOME TRUST
 
 
 
 
Statement of Investments, August 31, 2018 (unaudited)          
Franklin High Income Fund          
      Shares/    
  Country   Warrants   Value
 
Common Stocks and Other Equity Interests 2.1%          
Energy 1.9%          
a Alpha Natural Resources Holdings Inc United States   11,550 $ 389,813
a Amplify Energy Corp United States   24,249   238,610
a Birch Permian Holdings Inc United States   1,413,995   16,260,942
a Chaparral Energy Inc United States   43,062   785,882
a,b Chaparral Energy Inc., A, 144A United States   5,033   92,607
a Contura Energy Inc United States   6,606   508,332
a Contura Energy Inc., wts., 7/26/23 United States   5,033   191,254
a Energy XXI Gulf Coast Inc., wts., 12/30/21 United States   124,561   12
a,c Goodrich Petroleum Corp United States   1,564,885   21,892,741
a Halcon Resources Corp United States   1,889,580   8,654,276
a Halcon Resources Corp., wts., 9/09/20 United States   145,844   23,335
a Linn Energy Inc United States   156,119   2,700,859
a Midstates Petroleum Co. Inc United States   11,657   135,571
a,d Midstates Petroleum Co. Inc., wts., 4/21/20 United States   82,587   337
a,d,e Nine Point Energy LLC United States   433,273   6,114,116
a Riviera Resources Inc United States   156,119   3,356,558
a,c Titan Energy LLC United States   289,137   130,112
          61,475,357
Materials 0.1%          
a ANR Inc., C1 United States   43,457   1,466,674
a Verso Corp., A United States   83,362   2,616,733
a Verso Corp., wts., 7/25/23 United States   8,775   84,240
          4,167,647
Transportation 0.1%          
a,d CEVA Logistics AG Switzerland   108,515   2,374,911
Total Common Stocks and Other Equity Interests          
   (Cost $175,459,672)         68,017,915
 
Convertible Preferred Stocks (Cost $7,552,087) 0.3%          
Energy 0.3%          
a,d,e Nine Point Energy Holdings Inc., cvt. pfd United States   8,080   11,513,931
 
 
      Principal    
      Amount*    
 
Convertible Bonds (Cost $6,923,862) 0.3%          
Energy 0.3%          
c,f Goodrich Petroleum Corp., senior secured note, second lien, PIK, cvt.,          
  13.50%, 8/30/19 United States $ 8,250,000   8,853,389
Corporate Bonds 91.4%          
Automobiles & Components 0.1%          
The Goodyear Tire & Rubber Co., senior bond, 5.00%, 5/31/26 United States   4,400,000   4,147,000
Banks 2.7%          
CIT Group Inc.,          
     senior bond, 5.00%, 8/15/22 United States   3,850,000   3,936,625
     senior note, 5.25%, 3/07/25 United States   8,200,000   8,358,875

 

Quarterly Statement of Investments | See Notes to Statements of Investments. | 1

 

FRANKLIN HIGH INCOME TRUST
STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin High Income Fund (continued)          
      Principal    
  Country   Amount*   Value
 
Corporate Bonds (continued)          
Banks (continued)          
g Citigroup Inc., junior sub. bond, M, 6.30% to 5/15/24, FRN thereafter,          
Perpetual United States $ 35,000,000 $ 36,006,250
g JPMorgan Chase & Co.,          
junior sub. bond, R, 6.00% to 8/01/23, FRN thereafter, Perpetual United States   15,000,000   15,671,550
junior sub. bond, V, 5.00% to 7/30/19, FRN thereafter, Perpetual United States   9,900,000   9,994,545
Royal Bank of Scotland Group PLC,          
sub. note, 6.125%, 12/15/22 United Kingdom   4,000,000   4,201,580
sub. note, 5.125%, 5/28/24 United Kingdom   10,000,000   10,044,500
          88,213,925
Capital Goods 4.9%          
Aircastle Ltd., senior note, 4.125%, 5/01/24 United States   18,000,000   17,917,200
b BBA U.S. Holdings Inc., senior note, 144A, 5.375%, 5/01/26 United States   9,800,000   9,849,000
b Beacon Roofing Supply Inc., senior note, 144A, 4.875%, 11/01/25 United States   14,400,000   13,356,000
b BWX Technologies Inc., senior note, 144A, 5.375%, 7/15/26 United States   8,500,000   8,606,250
b Cloud Crane LLC, secured note, second lien, 144A, 10.125%, 8/01/24 United States   10,000,000   10,900,000
CNH Industrial Capital LLC, senior note, 3.875%, 10/15/21 United States   5,300,000   5,300,000
H&E Equipment Services Inc., senior note, 5.625%, 9/01/25 United States   19,700,000   19,607,410
b Jeld-Wen Inc.,          
senior bond, 144A, 4.875%, 12/15/27 United States   7,800,000   7,293,000
senior note, 144A, 4.625%, 12/15/25 United States   7,600,000   7,106,000
b Pisces Midco Inc., senior secured note, 144A, 8.00%, 4/15/26 United States   18,000,000   18,540,000
b Terex Corp., senior note, 144A, 5.625%, 2/01/25 United States   10,400,000   10,335,000
b Vertiv Group Corp., senior note, 144A, 9.25%, 10/15/24 United States   31,500,000   32,523,750
          161,333,610
Commercial & Professional Services 2.3%          
d,h Goss Graphic Systems Inc., senior sub. note, 12.25%, 11/19/05 United States   9,053,899   905
United Rentals North America Inc.,          
senior bond, 5.75%, 11/15/24 United States   14,000,000   14,503,300
senior bond, 5.875%, 9/15/26 United States   9,600,000   9,924,000
senior bond, 5.50%, 5/15/27 United States   18,400,000   18,400,000
b West Corp., senior note, 144A, 8.50%, 10/15/25. United States   34,900,000   31,933,500
          74,761,705
Consumer Durables & Apparel 2.0%          
b Hanesbrands Inc., senior note, 144A, 4.625%, 5/15/24 United States   17,000,000   16,660,000
KB Home, senior note, 7.00%, 12/15/21 United States   5,000,000   5,287,500
PulteGroup Inc., senior bond, 5.00%, 1/15/27 United States   12,000,000   11,475,000
b Taylor Morrison Communities Inc./Taylor Morrison Holdings II Inc., senior          
note, 144A, 5.625%, 3/01/24 United States   8,800,000   8,690,000
Weekley Homes LLC/Weekley Finance Corp., senior note, 6.625%, 8/15/25 . United States   25,000,000   23,750,000
          65,862,500
Consumer Services 6.5%          
b 1011778 BC ULC/New Red Finance Inc.,          
secured note, second lien, 144A, 5.00%, 10/15/25 Canada   7,400,000   7,178,000
senior secured note, first lien, 144A, 4.25%, 5/15/24 Canada   19,100,000   18,288,250

 

|2

 

FRANKLIN HIGH INCOME TRUST
STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin High Income Fund (continued)          
      Principal    
  Country   Amount*   Value
 
Corporate Bonds (continued)          
Consumer Services (continued)          
b 24 Hour Holdings III LLC, senior note, 144A, 8.00%, 6/01/22 United States $ 28,000,000 $ 28,148,960
b Downstream Development Authority of the Quapaw Tribe of Oklahoma,          
secured note, 144A, 10.50%, 2/15/23 United States   8,600,000   8,621,500
b Golden Nugget Inc., senior note, 144A, 6.75%, 10/15/24 United States   23,200,000   23,635,000
b Jack Ohio Finance LLC/Jack Ohio Finance 1 Corp.,          
secured note, second lien, 144A, 10.25%, 11/15/22 United States   11,500,000   12,535,000
senior secured note, first lien, 144A, 6.75%, 11/15/21. United States   22,100,000   22,928,750
b KFC Holding Co./Pizza Hut Holdings LLC/Taco Bell of America LLC,          
senior note, 144A, 5.00%, 6/01/24 United States   15,600,000   15,600,000
senior note, 144A, 5.25%, 6/01/26 United States   12,700,000   12,731,750
b Stars Group Holdings BV/Stars Group U.S. Co-Borrower LLC, senior note,          
144A, 7.00%, 7/15/26 Canada   11,000,000   11,467,500
b Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp., senior bond, 144A,          
5.50%, 3/01/25 United States   20,000,000   19,838,000
b Wynn Macau Ltd.,          
senior bond, 144A, 5.50%, 10/01/27 Macau   23,000,000   21,965,000
senior note, 144A, 4.875%, 10/01/24 Macau   11,300,000   10,777,375
          213,715,085
Diversified Financials 2.2%          
b MSCI Inc., senior note, 144A, 5.375%, 5/15/27 United States   11,300,000   11,639,000
Navient Corp.,          
senior note, 5.00%, 10/26/20 United States   7,200,000   7,237,512
senior note, 5.875%, 3/25/21 United States   5,000,000   5,132,750
senior note, 6.625%, 7/26/21 United States   9,500,000   9,915,625
senior note, 6.50%, 6/15/22 United States   9,900,000   10,249,470
senior note, 7.25%, 9/25/23 United States   27,780,000   29,446,800
          73,621,157
Energy 12.5%          
b Aker BP ASA, senior note, 144A, 5.875%, 3/31/25 Norway   18,800,000   19,488,230
California Resources Corp.,          
b secured note, second lien, 144A, 8.00%, 12/15/22 United States   13,382,000   12,060,528
senior bond, 6.00%, 11/15/24 United States   850,000   697,000
senior note, 5.50%, 9/15/21 United States   411,000   359,625
Callon Petroleum Co., senior note, 6.375%, 7/01/26 United States   18,000,000   18,517,500
Calumet Specialty Products Partners LP/Calumet Finance Corp., senior          
note, 7.75%, 4/15/23 United States   22,700,000   22,586,500
Cheniere Corpus Christi Holdings LLC,          
senior secured note, first lien, 7.00%, 6/30/24 United States   15,600,000   17,316,000
senior secured note, first lien, 5.875%, 3/31/25 United States   21,500,000   22,924,375
Cheniere Energy Partners LP, senior secured note, first lien, 5.25%,          
10/01/25 United States   28,700,000   28,771,750
CONSOL Energy Inc., senior note, 8.00%, 4/01/23 United States   10,004,000   10,582,331
Crestwood Midstream Partners LP/Crestwood Midstream Finance Corp.,          
senior note, 6.25%, 4/01/23 United States   17,000,000   17,616,250
senior note, 5.75%, 4/01/25 United States   15,000,000   15,375,000
CSI Compressco LP/CSI Compressco Finance Inc., senior note, 7.25%,          
8/15/22 United States   12,900,000   12,013,125
Energy Transfer Equity LP,          
senior secured bond, first lien, 5.875%, 1/15/24 United States   15,000,000   15,975,000
senior secured bond, first lien, 5.50%, 6/01/27. United States   17,900,000   18,817,375

 

|3

 

FRANKLIN HIGH INCOME TRUST
STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin High Income Fund (continued)          
      Principal    
  Country   Amount*   Value
 
Corporate Bonds (continued)          
Energy (continued)          
b,f EnQuest PLC, senior note, 144A, PIK, 7.00%, 4/15/22 United Kingdom $ 22,955,575 $ 20,770,720
Ferrellgas LP/Ferrellgas Finance Corp., senior note, 6.75%, 6/15/23. United States   23,600,000   20,414,000
c,d,f Goodrich Petroleum Corp., senior secured note, second lien, PIK, 13.50%,          
8/30/19 United States   2,169,208   2,291,958
Martin Midstream Partners LP/Martin Midstream Finance Corp., senior note,          
    7.25%, 2/15/21 United States   17,000,000   17,042,500
b,f Murray Energy Corp., 1.5 lien, 144A, PIK, 12.00%, 4/15/24 United States   18,130,000   13,053,600
Oceaneering International Inc., senior note, 6.00%, 2/01/28 United States   16,600,000   16,501,633
QEP Resources Inc.,          
senior bond, 5.375%, 10/01/22 United States   14,000,000   14,144,200
senior note, 5.625%, 3/01/26 United States   10,700,000   10,272,000
Sanchez Energy Corp.,          
senior note, 7.75%, 6/15/21 United States   7,000,000   4,900,000
senior note, 6.125%, 1/15/23 United States   8,000,000   4,557,200
b Sunoco LP/Sunoco Finance Corp.,          
senior note, 144A, 4.875%, 1/15/23 United States   6,500,000   6,428,760
senior note, 144A, 5.50%, 2/15/26 United States   8,000,000   7,680,000
b,f W&T Offshore Inc.,          
secured note, second lien, 144A, PIK, 9.00%, 5/15/20 United States   9,999,941   10,074,941
senior secured note, third lien, 144A, PIK, 10.00%, 6/15/21. United States   9,060,098   8,650,964
Weatherford International Ltd.,          
senior note, 5.125%, 9/15/20 United States   5,300,000   5,286,750
senior note, 4.50%, 4/15/22 United States   8,500,000   7,437,500
senior note, 8.25%, 6/15/23 United States   9,600,000   8,976,000
          411,583,315
Food & Staples Retailing 0.3%          
b Aramark Services Inc., senior bond, 144A, 5.00%, 2/01/28 United States   8,300,000   8,154,750
Food, Beverage & Tobacco 3.2%          
B&G Foods Inc., senior note, 5.25%, 4/01/25 United States   17,300,000   16,845,875
b Cott Holdings Inc., senior note, 144A, 5.50%, 4/01/25 Canada   25,000,000   24,546,250
b Lamb Weston Holdings Inc.,          
senior note, 144A, 4.625%, 11/01/24 United States   13,900,000   13,726,250
senior note, 144A, 4.875%, 11/01/26 United States   17,700,000   17,478,750
b Post Holdings Inc.,          
senior bond, 144A, 5.00%, 8/15/26. United States   26,000,000   25,025,000
senior note, 144A, 5.50%, 3/01/25 United States   7,500,000   7,500,000
          105,122,125
Health Care Equipment & Services 6.4%          
b Avantor Inc., senior secured note, first lien, 144A, 6.00%, 10/01/24 United States   17,300,000   17,602,750
b Centene Corp., senior note, 144A, 5.375%, 6/01/26 United States   25,550,000   26,439,906
CHS/Community Health Systems Inc.,          
senior note, 6.875%, 2/01/22 United States   4,003,000   2,047,159
   b senior note, 144A, 8.125%, 6/30/24 United States   13,747,000   11,375,643
senior secured note, 5.125%, 8/01/21. United States   4,100,000   3,977,000
senior secured note, first lien, 6.25%, 3/31/23 United States   14,200,000   13,561,000
HCA Inc.,          
senior bond, 5.875%, 5/01/23 United States   16,000,000   16,840,000
senior bond, 5.375%, 2/01/25 United States   7,000,000   7,097,510
senior secured bond, first lien, 5.25%, 4/15/25. United States   11,000,000   11,371,250
senior secured note, first lien, 5.00%, 3/15/24 United States   5,000,000   5,125,000

 

|4

 

FRANKLIN HIGH INCOME TRUST
STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin High Income Fund (continued)          
      Principal    
  Country   Amount*   Value
 
Corporate Bonds (continued)          
Health Care Equipment & Services (continued)          
b MPH Acquisition Holdings LLC, senior note, 144A, 7.125%, 6/01/24 United States $ 17,400,000 $ 18,052,500
b,f Polaris Intermediate Corp., senior note, 144A, PIK, 8.50%, 12/01/22 United States   7,000,000   7,253,750
Tenet Healthcare Corp.,          
senior note, 8.125%, 4/01/22 United States   12,000,000   12,720,000
senior note, 6.75%, 6/15/23 United States   13,700,000   13,751,375
senior secured note, first lien, 6.00%, 10/01/20 United States   6,700,000   6,984,750
WellCare Health Plans Inc.,          
senior note, 5.25%, 4/01/25 United States   29,500,000   30,237,500
b senior note, 144A, 5.375%, 8/15/26 United States   5,000,000   5,162,500
          209,599,593
Household & Personal Products 0.5%          
b Prestige Brands Inc., senior note, 144A, 6.375%, 3/01/24 United States   17,800,000   18,050,090
Materials 13.4%          
f ARD Finance SA, secured note, PIK, 7.125%, 9/15/23 Luxembourg   14,000,000   14,227,500
b Ardagh Packaging Finance PLC/Ardagh MP Holdings USA Inc., senior note,          
144A, 6.00%, 2/15/25 Luxembourg   10,000,000   9,800,000
b BWAY Holding Co., senior note, 144A, 7.25%, 4/15/25 United States   34,900,000   34,114,750
b Cemex SAB de CV, senior secured bond, first lien, 144A, 5.70%, 1/11/25 Mexico   25,000,000   25,246,375
The Chemours Co.,          
senior note, 6.625%, 5/15/23 United States   8,791,000   9,219,562
senior note, 5.375%, 5/15/27 United States   12,200,000   12,017,000
b Crown Americas LLC/Crown Americas Capital Corp., senior note, 144A,          
4.75%, 2/01/26 United States   13,900,000   13,378,750
b Eldorado Gold Corp., senior note, 144A, 6.125%, 12/15/20 Canada   21,700,000   20,452,250
b First Quantum Minerals Ltd.,          
senior note, 144A, 7.00%, 2/15/21 Zambia   8,000,000   7,930,000
senior note, 144A, 7.25%, 4/01/23 Zambia   17,000,000   16,660,000
senior note, 144A, 6.875%, 3/01/26 Zambia   8,000,000   7,509,360
b FMG Resources (August 2006) Pty. Ltd.,          
senior note, 144A, 4.75%, 5/15/22 Australia   5,000,000   4,904,175
senior note, 144A, 5.125%, 3/15/23 Australia   7,200,000   7,056,000
senior note, 144A, 5.125%, 5/15/24 Australia   8,600,000   8,349,181
b Grinding Media Inc./MC Grinding Media Canada Inc., senior secured note,          
144A, 7.375%, 12/15/23 United States   16,500,000   17,361,135
b New Enterprise Stone & Lime Co., senior note, 144A, 6.25%, 3/15/26 United States   17,400,000   17,748,000
b New Gold Inc., senior note, 144A, 6.375%, 5/15/25 Canada   16,600,000   14,193,000
b Northwest Acquisitions ULC/Dominion Finco Inc., secured note, second lien,          
144A, 7.125%, 11/01/22 Canada   9,100,000   9,316,125
b Novelis Corp.,          
senior bond, 144A, 5.875%, 9/30/26 United States   15,700,000   15,327,910
senior note, 144A, 6.25%, 8/15/24 United States   16,000,000   16,240,000
b OCI NV, senior note, 144A, 6.625%, 4/15/23 Netherlands   9,600,000   9,984,000
b Owens-Brockway Glass Container Inc.,          
senior note, 144A, 5.00%, 1/15/22 United States   10,000,000   10,062,500
senior note, 144A, 5.875%, 8/15/23 United States   10,000,000   10,287,500
b Petra Diamonds U.S. Treasury PLC, secured note, second lien, 144A,          
7.25%, 5/01/22 South Africa   17,400,000   16,791,000
b Platform Specialty Products Corp.,          
senior note, 144A, 6.50%, 2/01/22 United States   10,500,000   10,775,625
senior note, 144A, 5.875%, 12/01/25 United States   20,000,000   19,875,000

 

|5

 

FRANKLIN HIGH INCOME TRUST
STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin High Income Fund (continued)          
      Principal    
  Country   Amount*   Value
 
Corporate Bonds (continued)          
Materials (continued)          
b Reynolds Group Issuer Inc./Reynolds Group Issuer LLC/Reynolds Group          
Issuer Luxembourg SA,          
senior secured note, first lien, 144A, 5.125%, 7/15/23. United States $ 7,200,000 $ 7,182,000
i senior secured note, first lien, 144A, FRN, 5.839%, (3-month USD          
    LIBOR + 3.50%), 7/15/21 United States   5,300,000   5,372,875
b Sealed Air Corp., senior bond, 144A, 5.50%, 9/15/25 United States   5,500,000   5,596,250
Steel Dynamics Inc.,          
senior bond, 5.50%, 10/01/24 United States   10,000,000   10,275,000
senior bond, 5.00%, 12/15/26 United States   15,000,000   14,962,500
Summit Materials LLC/Summit Materials Finance Corp., senior note, 8.50%,          
4/15/22 United States   5,000,000   5,368,750
b SunCoke Energy Partners LP/SunCoke Energy Partners Finance Corp.,          
senior note, 144A, 7.50%, 6/15/25 United States   33,600,000   35,112,000
          442,696,073
Media 10.3%          
b Altice Luxembourg SA, senior secured note, 144A, 7.75%, 5/15/22 Luxembourg   30,900,000   29,895,750
b Altice U.S. Finance I Corp., senior secured bond, 144A, 5.50%, 5/15/26 United States   23,550,000   23,196,750
AMC Entertainment Holdings Inc., senior sub. note, 5.875%, 11/15/26 United States   4,100,000   4,007,750
AMC Networks Inc., senior note, 5.00%, 4/01/24 United States   22,800,000   22,486,500
CCO Holdings LLC/CCO Holdings Capital Corp.,          
senior bond, 5.125%, 2/15/23 United States   10,000,000   10,037,500
b senior bond, 144A, 5.375%, 5/01/25 United States   12,000,000   11,955,000
b senior bond, 144A, 5.75%, 2/15/26. United States   13,200,000   13,233,000
b senior bond, 144A, 5.00%, 2/01/28. United States   10,000,000   9,415,300
b Cequel Communications Holdings I LLC/Cequel Capital Corp., senior note,          
144A, 7.50%, 4/01/28 United States   10,000,000   10,475,000
Clear Channel Worldwide Holdings Inc.,          
senior note, 6.50%, 11/15/22 United States   3,500,000   3,583,125
senior note, 6.50%, 11/15/22 United States   6,500,000   6,678,750
senior sub. note, 7.625%, 3/15/20 United States   1,650,000   1,654,125
senior sub. note, 7.625%, 3/15/20 United States   14,000,000   14,105,000
CSC Holdings LLC,          
b senior bond, 144A, 5.50%, 4/15/27. United States   8,000,000   7,810,000
b senior bond, 144A, 5.375%, 2/01/28 United States   9,000,000   8,648,550
senior note, 6.75%, 11/15/21 United States   5,000,000   5,312,500
senior note, 5.25%, 6/01/24 United States   28,000,000   27,230,000
DISH DBS Corp.,          
senior bond, 5.875%, 7/15/22 United States   20,000,000   19,275,000
senior bond, 5.00%, 3/15/23 United States   5,000,000   4,468,750
senior note, 5.875%, 11/15/24 United States   17,500,000   15,290,625
b Nexstar Broadcasting Inc., senior note, 144A, 5.625%, 8/01/24 United States   12,800,000   12,610,560
b Unitymedia KabelBW GmbH, senior bond, 144A, 6.125%, 1/15/25 Germany   23,500,000   24,528,125
b Univision Communications Inc.,          
senior secured note, first lien, 144A, 5.125%, 5/15/23. United States   5,000,000   4,762,500
senior secured note, first lien, 144A, 5.125%, 2/15/25. United States   16,000,000   14,720,000
b Virgin Media Secured Finance PLC,          
senior secured bond, 144A, 5.25%, 1/15/26 United Kingdom   10,000,000   9,712,500
senior secured bond, first lien, 144A, 5.50%, 1/15/25 United Kingdom   7,000,000   6,991,250
senior secured bond, first lien, 144A, 5.50%, 8/15/26 United Kingdom   7,300,000   7,190,500

 

|6

 

FRANKLIN HIGH INCOME TRUST
STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin High Income Fund (continued)          
      Principal    
  Country   Amount*   Value
 
Corporate Bonds (continued)          
Media (continued)          
b WMG Acquisition Corp.,          
secured note, 144A, 4.875%, 11/01/24 United States $ 2,600,000 $ 2,538,250
secured note, first lien, 144A, 5.00%, 8/01/23 United States   8,500,000   8,468,125
          340,280,785
Pharmaceuticals, Biotechnology & Life Sciences 5.0%          
b AMAG Pharmaceuticals Inc., senior note, 144A, 7.875%, 9/01/23 United States   14,000,000   14,826,840
b Bausch Health Cos Inc., senior note, 144A, 9.25%, 4/01/26. United States   27,000,000   28,708,560
b Bausch Health Cos. Inc.,          
senior note, 144A, 7.50%, 7/15/21 United States   10,000,000   10,177,550
senior note, 144A, 5.625%, 12/01/21 United States   15,000,000   14,906,250
senior note, first lien, 144A, 7.00%, 3/15/24. United States   4,200,000   4,446,750
b Concordia International Corp.,          
   h senior note, 144A, 7.00%, 4/15/23 Canada   23,100,000   1,443,750
senior secured note, first lien, 144A, 9.00%, 4/01/22 Canada   11,000,000   10,065,000
b,f Eagle Holdings Co. II LLC, senior note, 144A, PIK, 7.625%, 5/15/22 United States   14,200,000   14,413,000
b Endo DAC/Endo Finance LLC/Endo Finco Inc.,          
senior bond, 144A, 6.00%, 2/01/25. United States   23,400,000   19,480,500
senior note, 144A, 6.00%, 7/15/23 United States   16,200,000   14,013,000
Horizon Pharma Inc., senior note, 6.625%, 5/01/23 United States   24,000,000   24,540,000
b Horizon Pharma Inc./Horizon Pharma USA Inc., senior note, 144A, 8.75%,          
11/01/24 United States   7,000,000   7,490,000
          164,511,200
Real Estate 2.1%          
CyrusOne LP/CyrusOne Finance Corp., senior note, 5.375%, 3/15/27 United States   9,400,000   9,470,500
Equinix Inc., senior bond, 5.375%, 4/01/23 United States   14,000,000   14,367,500
b Five Point Operating Co. LP/Five Point Capital Corp., senior note, 144A,          
7.875%, 11/15/25 United States   21,400,000   21,721,000
MPT Operating Partnership LP/MPT Finance Corp.,          
senior bond, 5.25%, 8/01/26 United States   7,700,000   7,738,500
senior bond, 5.00%, 10/15/27 United States   17,100,000   16,800,750
          70,098,250
Retailing 1.7%          
Netflix Inc.,          
senior bond, 4.375%, 11/15/26 United States   15,700,000   14,870,883
b senior bond, 144A, 5.875%, 11/15/28 United States   11,100,000   11,181,141
b Party City Holdings Inc., senior note, 144A, 6.625%, 8/01/26 United States   7,300,000   7,373,000
b PetSmart Inc.,          
senior note, 144A, 7.125%, 3/15/23 United States   12,700,000   8,604,250
senior secured note, first lien, 144A, 5.875%, 6/01/25. United States   15,600,000   12,733,500
          54,762,774
Semiconductors & Semiconductor Equipment 0.7%          
b Qorvo Inc., senior note, 144A, 5.50%, 7/15/26 United States   23,700,000   23,877,750
Software & Services 2.5%          
b First Data Corp.,          
secured note, first lien, 144A, 5.00%, 1/15/24 United States   5,000,000   5,029,000
secured note, second lien, 144A, 5.75%, 1/15/24 United States   30,000,000   30,712,500
Infor (U.S.) Inc., senior note, 6.50%, 5/15/22 United States   34,000,000   34,610,980
b Symantec Corp., senior note, 144A, 5.00%, 4/15/25 United States   12,600,000   12,519,672
          82,872,152

 

|7

 

FRANKLIN HIGH INCOME TRUST
STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin High Income Fund (continued)          
      Principal    
  Country   Amount*   Value
 
Corporate Bonds (continued)          
Technology Hardware & Equipment 2.1%          
b Blackboard Inc., secured note, second lien, 144A, 9.75%, 10/15/21 United States $ 34,410,000 $ 27,183,900
b CommScope Inc., senior bond, 144A, 5.50%, 6/15/24. United States   7,000,000   7,113,750
b CommScope Technologies LLC, senior bond, 144A, 6.00%, 6/15/25. United States   10,200,000   10,608,000
b Dell International LLC/EMC Corp.,          
senior note, 144A, 5.875%, 6/15/21 United States   4,500,000   4,641,075
senior note, 144A, 7.125%, 6/15/24 United States   4,900,000   5,239,334
senior secured bond, first lien, 144A, 6.02%, 6/15/26 United States   5,400,000   5,729,276
senior secured note, first lien, 144A, 5.45%, 6/15/23 United States   7,000,000   7,354,252
          67,869,587
Telecommunication Services 5.6%          
b Block Communications Inc., senior note, 144A, 6.875%, 2/15/25 United States   8,700,000   8,919,675
b Digicel Group Ltd., senior note, 144A, 8.25%, 9/30/20. Bermuda   15,000,000   11,320,650
b Digicel Ltd., senior note, 144A, 6.00%, 4/15/21 Bermuda   22,000,000   20,544,260
b DKT Finance ApS, senior secured note, first lien, 144A, 9.375%, 6/17/23 Denmark   16,800,000   17,792,376
Hughes Satellite Systems Corp., senior bond, 6.625%, 8/01/26 United States   22,650,000   21,744,000
Sprint Communications Inc.,          
senior note, 6.00%, 11/15/22 United States   6,500,000   6,595,485
b senior note, 144A, 9.00%, 11/15/18 United States   3,968,000   4,017,600
Sprint Corp.,          
senior note, 7.625%, 2/15/25 United States   20,000,000   21,275,000
senior note, 7.625%, 3/01/26 United States   15,300,000   16,105,698
b Sprint Spectrum Co. LLC/Sprint Spectrum Co. II LLC, senior secured bond,          
first lien, 144A, 4.738%, 9/20/29 United States   16,600,000   16,641,500
T-Mobile USA Inc.,          
senior bond, 6.375%, 3/01/25 United States   22,400,000   23,352,000
senior note, 6.00%, 4/15/24 United States   8,500,000   8,840,000
senior note, 5.125%, 4/15/25 United States   9,000,000   9,094,140
          186,242,384
Transportation 1.1%          
b DAE Funding LLC,          
senior note, 144A, 4.50%, 8/01/22 United Arab Emirates   16,000,000   15,840,000
senior note, 144A, 5.00%, 8/01/24 United Arab Emirates   12,000,000   11,850,000
b Park Aerospace Holdings Ltd., senior note, 144A, 5.50%, 2/15/24 Ireland   8,900,000   9,139,232
          36,829,232
Utilities 3.3%          
Calpine Corp.,          
senior bond, 5.75%, 1/15/25 United States   12,400,000   11,315,000
senior note, 5.375%, 1/15/23 United States   18,300,000   17,453,625
b senior secured bond, first lien, 144A, 5.875%, 1/15/24 United States   5,000,000   5,056,250
Ferrellgas Partners LP/Ferrellgas Partners Finance Corp., senior note,          
8.625%, 6/15/20 United States   6,600,000   6,501,000
b InterGen NV, secured bond, 144A, 7.00%, 6/30/23 Netherlands   5,800,000   5,800,000
NRG Yield Operating LLC,          
senior bond, 5.375%, 8/15/24 United States   16,000,000   16,160,000
senior bond, 5.00%, 9/15/26 United States   19,000,000   18,287,500
Talen Energy Supply LLC, senior note, 6.50%, 6/01/25 United States   39,650,000   29,737,500
          110,310,875
Total Corporate Bonds (Cost $3,079,466,341)         3,014,515,917

 

|8

 

FRANKLIN HIGH INCOME TRUST
STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin High Income Fund (continued)        
  Country Shares   Value
Escrows and Litigation Trusts 0.0%†        
a,d Alpha Natural Resources Inc., Escrow Account United States 25,000,000 $ —
a,d Midstates Petroleum Co. Inc./Midstates Petroleum Co. LLC, Escrow Account. United States 25,000,000   —
a,d NewPage Corp., Litigation Trust United States 30,000,000   —
a Penn Virginia Corp., Escrow Account United States 25,000,000   68,750
a,d T-Mobile USA Inc., Escrow Account United States 39,900,000   —
a Vistra Energy Corp., Escrow Account United States 50,000,000   312,500
Total Escrows and Litigation Trusts (Cost $1,442,951)       381,250
Total Investments before Short Term Investments        
(Cost $3,270,844,913)       3,103,282,402
 
 
Short Term Investments (Cost $159,811,939) 4.8%        
 
Money Market Funds 4.8%        
j,k Institutional Fiduciary Trust Money Market Portfolio, 1.64% United States 159,811,939   159,811,939
Total Investments (Cost $3,430,656,852) 98.9%       3,263,094,341
Other Assets, less Liabilities 1.1%       35,666,718
Net Assets 100.0%     $ 3,298,761,059

 

See Abbreviations on page 14.

†Rounds to less than 0.1% of net assets.
*The principal amount is stated in U.S. dollars unless otherwise indicated.
aNon-income producing.
bSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers
or in a public offering registered under the Securities Act of 1933. These securities have been deemed liquid under guidelines approved by the Trust’s Board of Trustees. At
August 31, 2018, the aggregate value of these securities was $1,751,106,138, representing 53.0% of net assets.
cSee Note 4 regarding holdings of 5% voting securities.
dFair valued using significant unobservable inputs. See Note 6 regarding fair value measurements.
eSee Note 3 regarding restricted securities.
fIncome may be received in additional securities and/or cash.
gPerpetual security with no stated maturity date.
hDefaulted security or security for which income has been deemed uncollectible.
iThe coupon rate shown represents the rate at period end.
jSee Note 5 regarding investments in affiliated management investment companies.
kThe rate shown is the annualized seven-day effective yield at period end.

|9

 

FRANKLIN HIGH INCOME TRUST

Notes to Statement of Investments (unaudited)

Franklin High Income Fund

1. ORGANIZATION

Franklin High Income Trust (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of one fund, Franklin High Income Fund (Fund) and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP).

2. FINANCIAL INSTRUMENT VALUATION

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The VC provides administration and oversight of the Fund’s valuation policies and procedures, which are approved annually by the Board. Among other things, these procedures allow the Fund to utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Debt securities generally trade in the OTC market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value.

Investments in open-end mutual funds are valued at the closing NAV.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the VC convenes on a regular basis to review such financial instruments and considers a number of factors, including significant unobservable valuation inputs, when arriving at fair value. The VC primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed. The VC employs various methods for calibrating these valuation approaches including a regular review of key inputs and assumptions, transactional back-testing or disposition analysis, and reviews of any related market activity.

|10

 

FRANKLIN HIGH INCOME TRUST
NOTES TO STATEMENT OF INVESTMENTS (UNAUDITED)

Trading in securities on foreign securities stock exchanges and OTC markets may be completed before 4 p.m. Eastern time. In addition, trading in certain foreign markets may not take place on every Fund’s business day. Occasionally, events occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, the VC monitors price movements following the close of trading in foreign stock markets through a series of country specific market proxies (such as baskets of American Depositary Receipts, futures contracts and exchange traded funds). These price movements are measured against established trigger thresholds for each specific market proxy to assist in determining if an event has occurred that may call into question the reliability of the values of the foreign securities held by the Fund. If such an event occurs, the securities may be valued using fair value procedures, which may include the use of independent pricing services.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.

3. RESTRICTED SECURITIES

At August 31, 2018, investments in restricted securities, excluding securities exempt from registration under the Securities Act of 1933 deemed to be liquid, were as follows:

    Acquisition        
Shares Issuer Date   Cost   Value
8,080 Nine Point Energy Holdings Inc., cvt. pfd 3/24/17 $ 7,552,087 $ 11,513,931
433,273 Nine Point Energy LLC 7/15/14 - 2/01/18   18,779,777   6,114,116
  Total Restricted Securities (Value is 0.5% of Net Assets)   $ 26,331,864 $ 17,628,047

 

4. HOLDINGS OF 5% VOTING SECURITIES OF PORTFOLIO COMPANIES

The 1940 Act defines "affiliated companies" to include investments in portfolio companies in which a fund owns 5% or more of the outstanding voting securities. During the period ended August 31, 2018, investments in “affiliated companies” were as follows:

  Number of     Number of                  
  Shares/     Shares/                  
  Principal     Principal               Net Change in  
  Amount Held     Amount Held   Value       Realized   Unrealized  
  at Beginning Gross Gross at End                at End    Investment   Gain   Appreciation  
Name of Issuer of Period Additions Reductions of Period   of Period   Income   (Loss)   (Depreciation)  
 
Non-Controlled Affiliates                          
                Dividends          
 
Goodrich Petroleum Corp 1,564,885 — — 1,564,885 $ 21,892,741 $ — $ — $ 1,596,183  
Titan Energy LLC 289,137 — — 289,137   130,112   —   —   (185,047 )
 
          $ 22,022,853 $ — $ — $ 1,411,136  

 

|11

 

FRANKLIN HIGH INCOME TRUST
NOTES TO STATEMENT OF INVESTMENTS (UNAUDITED)

4. HOLDINGS O        
 
 
  Number of       Number of                  
  Shares/       Shares/                  
  Principal       Principal                 Net Change in
  Amount Held       Amount Held   Value         Realized   Unrealized
  at Beginning Gross   Gross at End                                at End                       Investment     Gain   Appreciation
Name of Issuer of Period Additions   Reductions of Period   of Period         Income     (Loss)   (Depreciation)
 
Non-Controlled Affiliates (continued)                            
                  Interest          
Goodrich Petroleum Corp., senior secured note,                            
second lien, PIK, 13.50%, 8/30/19. 1,829,041 340,167 a — 2,169,208 $ 2,291,958 $ 66,657   $ — $ 2,516
Goodrich Petroleum Corp., senior secured note,                            
second lien, PIK, cvt., 13.50%, 8/30/19 8,250,000 —   — 8,250,000   8,853,389   278,438     —   45,448
            $ 11,145,347 $ 345,095   $ — $ 47,964
Total Affiliated Securities (Value is 1.0% of Net Assets)         $ 33,168,200 $ 345,095   $ — $ 1,459,100

 

aGross addition was the result of various corporate actions.

5. INVESTMENTS IN AFFILIATED MANAGEMENT INVESTMENT COMPANIES

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. During the period ended August 31, 2018, the Fund held investments in affiliated management investment companies as follows:

  Number of     Number of           Net Change in
  Shares Held     Shares   Value     Realized Unrealized
  at Beginning Gross Gross Held at End   at End   Dividend Gain Appreciation
  of Period Additions Reductions of Period   of Period   Income (Loss) (Depreciation)
 
Non-Controlled Affiliates                    
Institutional Fiduciary Trust Money Market                    
Portfolio, 1.64% 71,126,554 270,936,867 182,251,481 159,811,939 $ 159,811,939 $ 385,818 $ — $ —

 

6. FAIR VALUE MEASUREMENTS

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

  • Level 1 – quoted prices in active markets for identical financial instruments
  • Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)
  • Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

For movements between the levels within the fair value hierarchy, the Fund has adopted a policy of recognizing the transfers as of the date of the underlying event which caused the movement.

|12

 

FRANKLIN HIGH INCOME TRUST
NOTES TO STATEMENT OF INVESTMENTS (UNAUDITED)

A summary of inputs used as of August 31, 2018, in valuing the Fund’s assets carried at fair value, is as follows:    
 
 
    Level 1   Level 2   Level 3   Total
Assets:                
  Investments in Securities:a                
Equity Investments:b                
Energy. $ 39,099,950 $ 16,260,954 $ 17,628,384 $ 72,989,288
Transportation   —   —   2,374,911   2,374,911
All Other Equity Investments.   4,167,647   —   —   4,167,647
Convertible Bonds   —   8,853,389   —   8,853,389
Corporate Bonds:                
Commercial & Professional Services   —   74,760,800   905   74,761,705
Energy.   —   409,291,357   2,291,958   411,583,315
All Other Corporate Bonds   —   2,528,170,897   —   2,528,170,897
Escrows and Litigation Trusts   —   381,250   —c   381,250
Short Term Investments   159,811,939   —   —   159,811,939
Total Investments in Securities $ 203,079,536 $ 3,037,718,647 $ 22,296,158 $ 3,263,094,341

 

aFor detailed categories, see the accompanying Statement of Investments.
bIncludes common and convertible preferred stocks as well as other equity investments.
cIncludes securities determined to have no value at August 31, 2018.

A reconciliation of assets in which Level 3 inputs are used in determining fair value is presented when there are significant Level 3 financial instruments at the beginning and/or end of the period.

7. NEW ACCOUNTING PRONOUNCEMENTS

In March 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. The amendments in the ASU shorten the amortization period for certain callable debt securities acquired at a premium, to be amortized to the earliest call date. The ASU does not require an accounting change for securities acquired at a discount, which continues to be amortized to maturity. The ASU is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2018. Management has reviewed the requirements and believes the adoption of this ASU will not have a material impact on the financial statements.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurements. The amendments in the ASU modify the disclosure requirements on fair value measurements in Topic 820. The ASU is effective for interim and annual reporting periods beginning after December 15, 2019. Management is currently evaluating the impact, if any, of applying this provision.

8. SUBSEQUENT EVENTS

The Fund has evaluated subsequent events through the issuance of the Statement of Investments and determined that no events have occurred that require disclosure.

|13

 

FRANKLIN HIGH INCOME TRUST
NOTES TO STATEMENT OF INVESTMENTS (UNAUDITED)

Abbreviations    
 
Currency Selected Portfolio
USD United States Dollar FRN Floating Rate Note
  LIBOR London InterBank Offered Rate
  PIK Payment-In-Kind

 

For additional information on the Fund’s significant accounting policies, please refer to the Fund’s most recent semiannual or annual shareholder report.

|14

 

 

 

 

Item 2. Controls and Procedures.

 

(a) Evaluation of Disclosure Controls and Procedures.  The Registrant maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Registrant’s filings under the Securities Exchange Act of 1934 and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission.  Such information is accumulated and communicated to the Registrant’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.  The Registrant’s management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

 

Within 90 days prior to the filing date of this Quarterly Schedule of Portfolio Holdings on Form N-Q, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant’s management, including the Registrant’s principal executive officer and the Registrant’s principal financial officer, of the effectiveness of the design and operation of the Registrant’s disclosure controls and procedures.  Based on such evaluation, the Registrant’s principal executive officer and principal financial officer concluded that the Registrant’s disclosure controls and procedures are effective.

 

(b) Changes in Internal Controls.  There have been no changes in the Registrant’s internal controls or in other factors that could materially affect the internal controls over financial reporting subsequent to the date of their evaluation in connection with the preparation of this Quarterly Schedule of Portfolio Holdings on Form N-Q.

 

Item 3. Exhibits.

 

(a) Certification pursuant to Section 30a-2 under the Investment Company Act of 1940 of Matthew T. Hinkle, Chief Executive Officer - Finance and Administration, and Gaston Gardey, Chief Financial Officer and Chief Accounting Officer.

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

FRANKLIN HIGH INCOME TRUST

 

 

By /s/ Matthew T. Hinkle

      Matthew T. Hinkle

      Chief Executive Officer –

       Finance and Administration

Date  October 25, 2018

 

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

 

By  _/s/ Matthew T. Hinkle

      Matthew T. Hinkle

      Chief Executive Officer –

       Finance and Administration

Date  October 25, 2018

 

 

By  /s/ Gaston Gardey

      Gaston Gardey

      Chief Financial Officer and

       Chief Accounting Officer

Date  October 25, 2018