☐ | Check box if the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans. |
☒ | Check box if any securities being registered on this Form will be offered on a delayed or continuous basis in reliance on Rule 415 under the Securities Act of 1933 (“Securities Act”), other than securities offered in connection with a dividend reinvestment plan. |
☒ | Check box if this Form is a registration statement pursuant to General Instruction A.2 or a post-effective amendment thereto. |
☐ | Check box if this Form is a registration statement pursuant to General Instruction B or a post-effective amendment thereto that will become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act. |
☐ | Check box if this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction B to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act. |
☐ | when declared effective pursuant to Section 8(c) of the Securities Act. |
☐ | This [post-effective] amendment designates a new effective date for a previously filed [post-effective amendment] [registration statement]. |
☐ | This Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, and the Securities Act registration statement number of the earlier effective registration statement for the same offering is: . |
☐ | This Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, and the Securities Act registration statement number of the earlier effective registration statement for the same offering is: . |
☐ | This Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, and the Securities Act registration statement number of the earlier effective registration statement for the same offering is: . |
☐ | Registered Closed-End Fund (closed-end company that is registered under the Investment Company Act of 1940 (“Investment Company Act”)). |
☒ | Business Development Company (closed-end company that intends or has elected to be regulated as a business development company under the Investment Company Act). |
☐ | Interval Fund (Registered Closed-End Fund or a Business Development Company that makes periodic repurchase offers under Rule 23c-3 under the Investment Company Act). |
☒ | A.2 Qualified (qualified to register securities pursuant to General Instruction A.2 of this Form). |
☐ | Well-Known Seasoned Issuer (as defined by Rule 405 under the Securities Act). |
☒ | Emerging Growth Company (as defined by Rule 12b-2 under the Securities Exchange Act of 1934 (“Exchange Act”)). |
☐ | 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 7(a)(2)(B) of Securities Act. |
☐ | New Registrant (registered or regulated under the Investment Company Act for less than 12 calendar months preceding this filing). |
Title of Securities Being Registered | | | Amount Being Registered | | | Proposed Maximum Offering Price Per Unit(1) | | | Proposed Maximum Aggregate Offering Price | | | Amount of Registration Fee |
Common Stock, $0.01 par value | | | 9,376,223 | | | $3.39 | | | $31,785,396.00 | | | $3,467.79(2) |
(1) | Estimated solely for calculating the amount of the registration fee pursuant to Rule 457. |
(2) | Previously paid. |
• | We may lose all of our investments in Avanti Communications Group, plc (“Avanti”). |
• | We face increasing competition for investment opportunities. Limited availability of attractive investment opportunities in the market could cause us to hold a larger percentage of our assets in liquid securities until market conditions improve. |
• | Changes in the regulatory framework under which the wireless telecommunications industry operates and significant competition in the wireless telecommunications industry could adversely affect our business prospects or results of operations. |
• | We are invested in a limited number of portfolio companies, which may subject us to a risk of significant loss if one or more of these companies defaults on its obligations under any of its debt instruments. |
• | Our portfolio is concentrated in a limited number of industries, which subjects us to a risk of significant loss if there is a downturn in a particular industry in which a number of our investments are concentrated. |
• | Defaults by our portfolio companies may harm our operating results. |
• | If we invest in companies that experience significant financial or business difficulties, we may be exposed to distressed lending risks. |
• | Certain of the companies in which we invest may have difficulty accessing the capital markets to meet their future capital needs, which may limit their ability to grow or to repay their outstanding indebtedness upon maturity. |
• | Investing in middle market companies involves a high degree of risk and our financial results may be affected adversely if one or more of our portfolio investments defaults on its loans or notes or fails to perform as we expect. |
• | An investment strategy that includes privately held companies presents challenges, including the lack of available information about these companies, a dependence on the talents and efforts of only a few key portfolio company personnel and a greater vulnerability to economic downturns. |
• | Investments in foreign securities may involve significant risks in addition to the risks inherent in U.S. investments. |
• | Economic recessions or downturns could impair our portfolio companies and harm our operating results. |
• | Our failure to maintain our status as a BDC would reduce our operating flexibility. |
• | Regulations governing our operations as a BDC affect our ability to raise additional capital and the way in which we do so. As a BDC, the necessity of raising additional capital may expose us to risks, including the typical risks associated with leverage. |
• | We will be subject to corporate level U.S. federal income tax if we are unable to qualify as a RIC under the Code. |
• | We may incur additional debt, which could increase the risk in investing in our Company. |
• | The failure in cyber security systems, as well as the occurrence of events unanticipated in our disaster recovery systems and management continuity planning, could impair our ability to conduct business effectively. |
• | There are significant potential conflicts of interest that could impact our investment returns. |
Stockholder Transaction Expenses: | | | |
Sales Load (as a percentage of offering price) | | | —%(1) |
Offering Expenses (as a percentage of offering price) | | | —%(2) |
Dividend Reinvestment Plan Expenses | | | —(3) |
Total Stockholder Transaction Expenses (as a percentage of offering price) | | | —% |
Annual Expenses (as a percentage of net assets attributable to common shares): | | | |
Base Management Fee | | | 3.45%(4) |
Incentive Fee | | | 1.59%(5) |
Interest Payments on Borrowed Funds | | | 10.08%(6) |
Other Expenses | | | 3.10% |
Total Annual Expenses | | | 18.22% |
(1) | In the event that the shares included in this prospectus are sold to or through underwriters, a corresponding prospectus supplement will disclose the applicable sales load. |
(2) | In the event that the shares included in this prospectus are sold to or through underwriters, a corresponding prospectus supplement will disclose the estimated amount of total offering expenses (which may include offering expenses borne by third parties on our behalf), the offering price and the offering expenses borne by us as a percentage of the offering price. |
(3) | The expenses of the dividend reinvestment plan are included in “other expenses” in the table above. We have adopted a dividend reinvestment plan that provides for reinvestment of our dividends and other distributions on behalf of our stockholders, unless a stockholder elects to receive cash. As a result, if our Board authorizes, and we declare, a cash distribution, our stockholders who have not opted out of our dividend reinvestment plan will have their cash distributions (net of any applicable withholding tax) automatically reinvested in additional shares of our common stock, rather than receiving the cash distributions. For additional information, see “Dividend Reinvestment Plan.” |
(4) | We are externally managed by GECM and our base management fee is calculated at an annual rate of 1.50% based on the average value of our total assets (other than cash or cash equivalents, but including assets purchased with borrowed funds or other forms of leverage). Consequently, if we have borrowings outstanding, the base management fee as a percentage of net assets attributable to common shares would be higher than if we did not utilize leverage. |
(5) | See “The Company—Investment Management Agreement.” |
(6) | Assumes borrowings representing approximately 151% of our average net assets at an average annual interest rate of 6.36%. The amount of leverage that we may employ at any particular time will depend on, among other things, our Board’s and GECM’s assessment of market and other factors at the time of any proposed borrowing. |
| | 1 Year | | | 3 Years | | | 5 Years | | | 10 Years | |
You would pay the following expenses on a $1,000 common stock investment, assuming a 5% annual return (assumes no return from net realized capital gains) (none of which is subject to the capital gains incentive fee) | | | $157 | | | $417 | | | $621 | | | $956 |
You would pay the following expenses on a $1,000 common stock investment, assuming a 5% annual return resulting entirely from net realized capital gains (all of which is subject to the capital gains incentive fee) | | | $165 | | | $436 | | | $642 | | | $969 |
• | all 2019 Notes converting into common stock of Avanti, representing approximately 92% of the pro forma common stock of Avanti, with our position representing approximately 9.1% of the pro forma common stock of Avanti; and |
• | the cash interest rate on the PIK Toggle Notes being reduced from 10% to 9% and the PIK interest rate being reduced from 15% to 9% on the PIK Toggle Notes, the extension of the maturity date by one year to October 1, 2022 and receiving relaxed financial covenants, including the elimination of certain financial maintenance covenants. |
• | these companies may have limited financial resources and may be unable to meet their obligations under their debt securities that we hold, which may be accompanied by a deterioration in the value of any collateral and a reduction in the likelihood of us realizing any guarantees we may have obtained in connection with our investment; |
• | they typically have shorter operating histories, narrower product lines and smaller market shares than larger businesses, which tend to render them more vulnerable to competitors’ actions and market conditions, as well as general economic downturns; |
• | they are more likely to depend on the management talents and efforts of a small group of persons; therefore, the death, disability, resignation or termination of one or more of these persons could have a material adverse impact on our portfolio company and, in turn, on you; |
• | they generally have less predictable operating results, may from time to time be parties to litigation, may be engaged in rapidly changing businesses with products subject to a substantial risk of |
• | they may have difficulty accessing the capital markets to meet future capital needs, which may limit their ability to grow or to repay their outstanding indebtedness upon maturity; and |
• | a portion of our income may be non-cash income, such as contractual PIK interest, which represents interest added to the debt balance and due at the end of the instrument’s term, in the case of loans, or issued as additional notes in the case of bonds. Instruments bearing PIK interest typically carry higher interest rates as a result of their payment deferral and increased credit risk. When we recognize income in connection with PIK interest, there is a risk that such income may become uncollectable if the borrower defaults. |
• | as part of GECM’s strategy in order to take advantage of investment opportunities as they arise; |
• | when GECM believes that market conditions are unfavorable for profitable investing; |
• | when GECM is otherwise unable to locate attractive investment opportunities; |
• | as a defensive measure in response to adverse market or economic conditions; or |
• | to meet RIC qualification requirements. |
• | management’s attention will be diverted from running our existing business by efforts to source, negotiate, close and integrate acquisitions; |
• | our due diligence investigation of potential acquisitions may not reveal risks inherent in the acquired business or assets; |
• | we may over-value potential acquisitions resulting in dilution to stockholders, incurrence of excessive indebtedness, asset write downs and negative perception of our common stock; |
• | stockholder’s interest in GECC may be diluted by the issuance of additional common stock or preferred stock; |
• | we may borrow to finance acquisitions, and there are risks associated with borrowing as described in this prospectus; |
• | GECM has an incentive to increase our assets under management in order to increase its fee stream, which may not be aligned with your interests; |
• | we and GECM may not successfully integrate any acquired business or assets; and |
• | GECM may compensate the existing managers of any acquired business or assets in a manner that results in the combined company taking on excessive risk. |
• | price and volume fluctuations in the overall stock market from time to time; |
• | investor demand for our shares; |
• | significant volatility in the market price and trading volume of securities of BDCs or other companies in our sector, which are not necessarily related to the operating performance of these companies; |
• | exclusion of our common stock from certain indices, such as the Russell 2000 Financial Services Index, which could reduce the ability of certain investment funds to own our common stock and put short-term selling pressure on our common stock; |
• | changes in regulatory policies or tax guidelines with respect to RICs or BDCs; |
• | failure to qualify as a RIC, or the loss of RIC status; |
• | any shortfall in revenue or net income or any increase in losses from levels expected by investors or securities analysts; |
• | changes, or perceived changes, in the value of our portfolio investments; |
• | departures of GECM’s key personnel; |
• | operating performance of companies comparable to GECC; or |
• | general economic conditions and trends and other external factors. |
Table 1 | | | | | | | | | | | |||||
Assumed Return on Our Portfolio(1)(2) (net of expenses) | | | (10.0)% | | | (5.0)% | | | 0.0% | | | 5.0% | | | 10.0% |
Corresponding net return to common stockholder | | | (15.14)% | | | (10.14)% | | | (5.14)% | | | (0.14)% | | | 4.86% |
(1) | Assumes $209.4 million in total portfolio assets, $168.7 million in senior securities outstanding, $91.7 million in net assets, and an average cost of funds of 6.38%. Actual interest payments may be different. |
(2) | In order for us to cover our annual interest payments on indebtedness, we must achieve annual returns on our June 30, 2021 total portfolio assets of at least 5.14%. |
Table 2 | | | | | | | | | | | |||||
Assumed Return on Our Portfolio(1)(2) (net of expenses) | | | (10.0)% | | | (5.0)% | | | 0.0% | | | 5.0% | | | 10.0% |
Corresponding net return to common stockholder | | | (15.22)% | | | (10.22)% | | | (5.22)% | | | (0.22)% | | | 4.78% |
(1) | Assumes $224.04 million in total portfolio assets, $183.3 million in senior securities outstanding, $91.7 million in net assets, and an average cost of funds of 6.38%. Actual interest payments may be different. |
(2) | In order for us to cover our annual interest payments on indebtedness, we must achieve annual returns on our June 30, 2021 total portfolio assets of at least 5.22%. |
• | our, or our portfolio companies’, future business, operations, operating results or prospects; |
• | the return or impact of current and future investments; |
• | the impact of a protracted decline in the liquidity of credit markets on our business; |
• | the impact of fluctuations in interest rates on our business; |
• | the impact of changes in laws or regulations governing our operations or the operations of our portfolio companies; |
• | our contractual arrangements and relationships with third parties; |
• | our current and future management structure; |
• | the general economy and its impact on the industries in which we invest; |
• | the financial condition of and ability of our current and prospective portfolio companies to achieve their objectives; |
• | serious disruptions and catastrophic events, including the impact of the COVID-19 pandemic on the global economy; |
• | our expected financings and investments; |
• | the adequacy of our financing resources and working capital; |
• | the ability of our investment adviser to locate suitable investments for us and to monitor and administer our investments; |
• | the timing of cash flows, if any, from the operations of our portfolio companies; |
• | the timing, form and amount of any dividend distributions; |
• | the valuation of any investments in portfolio companies, particularly those having no liquid trading market; and |
• | our ability to maintain our qualification as a RIC and as a BDC. |
| | | | Closing Sales Price | | | | | | | ||||||||
Period | | | NAV(1) | | | High | | | Low | | | Premium (Discount) of High Sales Price to NAV | | | (Discount) of Low Sales Price to NAV(2) | | | Distributions Declared(3) |
Fiscal Year ending December 31, 2021 | | | | | | | | | | | | | ||||||
Fourth Quarter (through October 20, 2021) | | | $N/A | | | $3.55 | | | $3.34 | | | — | | | — | | | $— |
Third Quarter | | | N/A | | | 3.62 | | | 3.25 | | | — | | | — | | | 0.10 |
Second Quarter | | | 3.90 | | | 3.84 | | | 3.21 | | | (1.5)% | | | (17.7)% | | | 0.10 |
First Quarter | | | 3.89 | | | 4.03 | | | 3.07 | | | 3.6% | | | (21.1)% | | | 0.10 |
Fiscal Year ending December 31, 2020 | | | | | | | | | | | | | ||||||
Fourth Quarter | | | $ 3.46 | | | $ 4.06 | | | $ 2.45 | | | 17.3% | | | (29.2)% | | | $0.25 |
Third Quarter | | | 5.53 | | | 5.18 | | | 3.18 | | | (6.3)% | | | (42.5)% | | | 0.25 |
Second Quarter | | | 5.10 | | | 4.95 | | | 2.50 | | | (2.9)% | | | (51.0)% | | | 0.25 |
First Quarter | | | 5.05 | | | 8.08 | | | 2.62 | | | 60.0% | | | (48.1)% | | | 0.25 |
Fiscal Year ending December 31, 2019 | | | | | | | | | | | | | ||||||
Fourth Quarter | | | $8.63 | | | $8.47 | | | $7.70 | | | (1.9)% | | | (10.8)% | | | $0.30(4) |
Third Quarter | | | 9.09 | | | 8.92 | | | 8.02 | | | (1.9)% | | | (11.8)% | | | 0.25 |
Second Quarter | | | 10.30 | | | 8.96 | | | 8.2397 | | | (13.0)% | | | (20.0)% | | | 0.25 |
First Quarter | | | 10.89 | | | 8.50 | | | 7.01 | | | (22.0)% | | | (27.4)% | | | 0.25 |
(1) | NAV per share is determined as of the last day in the relevant quarter and therefore does not necessarily reflect the NAV per share on the date of the high and low closing sales prices. The NAVs shown are based on outstanding shares at the end of each period. |
(2) | Calculated as of the respective high or low closing sales price divided by the quarter-end NAV. |
(3) | We have adopted a dividend reinvestment plan that provides for reinvestment of our dividends and other distributions on behalf of our stockholders, unless a stockholder elects to receive cash. As a result, if our Board authorizes, and we declare, a cash distribution, our stockholders who have not opted out of our dividend reinvestment plan will have their cash distributions (net of any applicable withholding tax) automatically reinvested in additional shares of our common stock, rather than receiving the cash distributions. See “Dividend Reinvestment Plan” in this prospectus. |
(4) | Includes a special distribution of $0.05 per share. |
• | analysis of the credit documents by GECM’s investment team (including the members of the team with legal training and years of professional experience). GECM will engage outside counsel when necessary as well; |
• | review of historical and prospective financial information; |
• | research relating to the prospective portfolio company’s management, industry, markets, customers, products and services and competitors and customers; |
• | verification of collateral or assets; |
• | interviews with management, employees, customers and vendors of the prospective portfolio company; and |
• | informal or formal background and reference checks. |
• | determines the composition of our portfolio, the nature and timing of the changes to our portfolio and the manner of implementing such changes; |
• | identifies, evaluates and negotiates the structure of our investments (including performing due diligence on our prospective portfolio companies); |
• | closes and monitors our investments; and |
• | determines the securities and other assets that we purchase, retain or sell. |
• | no Income Incentive Fee in any calendar quarter in which the pre-incentive fee net investment income does not exceed the hurdle rate; |
• | 100% of our pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the hurdle rate, but is less than 2.1875% in any calendar quarter (8.75% annualized). We refer to this portion of our pre-incentive fee net investment income as the “catch up” provision. The “catch up” is meant to provide GECM with 20% of the pre-incentive fee net investment income as if a hurdle rate did not apply if our net investment income exceeds 2.1875% in any calendar quarter; and |
• | 20% of the amount of our pre-incentive fee net investment income, if any, that exceeds 2.1875% in any calendar quarter (8.75% annualized). |
| | Assumption 1 | | | Assumption 2 | | | Assumption 3 | |
Investment income(1) | | | 7.04% | | | 8.19% | | | 9.04% |
Hurdle rate (7% annualized) | | | 1.75% | | | 1.75% | | | 1.75% |
“Catch up” provision (8.75% annualized) | | | 2.19% | | | 2.19% | | | 2.19% |
Pre-incentive fee net investment income(2) | | | 1.00% | | | 2.15% | | | 3.00% |
Incentive fee | | | —%(3) | | | 0.40%(4) | | | 0.60%(5) |
(1) | Investment income includes interest income, dividends and other fee income. |
(2) | Pre-incentive fee net investment income is net of management fees and other expenses and excludes organizational and offering expenses. In these examples, management fees are 0.38% (1.50% annualized) of net assets and other expenses are assumed to be 3.04% of net assets. |
(3) | The pre-incentive fee net investment income is below the hurdle rate and thus no incentive fee is earned. |
(4) | The pre-incentive fee net investment income ratio of 2.15% is between the hurdle rate and the top of the “catch up” provision thus the corresponding incentive fee is calculated as 100% X (2.15% — 1.75%). |
(5) | The pre-incentive fee net investment income ratio of 3.00% is greater than both the hurdle rate and the “catch up” provision thus the corresponding incentive fee is calculated as (i) 100% X (2.1875% — 1.75%) or 0.4375% (the “catch up”); plus (ii) 20% X (3.00% — 2.1875%). |
| | In millions | ||||
| | Assumption 1 | | | Assumption 2 | |
Year 1 | | | | | ||
Investment in Company A | | | 20.0 | | | 20.0 |
Investment in Company B | | | 30.0 | | | 30.0 |
Investment in Company C | | | — | | | 25.0 |
Year 2 | | | | | ||
Proceeds from sale of investment in Company A | | | 50.0 | | | 50.0 |
Fair market value (FMV) of investment in Company B | | | 32.0 | | | 25.0 |
FMV of investment in Company C | | | — | | | 25.0 |
Year 3 | | | | | ||
Proceeds from sale of investment in Company C | | | — | | | 30.0 |
FMV of investment in Company B | | | 25.0 | | | 24.0 |
Year 4 | | | | | ||
Proceeds from sale of investment in Company B | | | 31.0 | | | — |
FMV of investment in Company B | | | — | | | 35.0 |
Year 5 | | | | | ||
Proceeds from sale of investment in Company B | | | — | | | 20.0 |
Capital Gains Incentive Fee: | | | | | ||
Year 1 | | | —(1) | | | —(1) |
Year 2 | | | 6.0(2) | | | 5.0(6) |
Year 3 | | | —(3) | | | 0.8(7) |
Year 4 | | | 0.2(4) | | | 1.2(8) |
Year 5 | | | —(5) | | | —(9) |
(1) | There is no Capital Gains Incentive Fee in Year 1 as there have been no realized capital gains. |
(2) | Aggregate realized capital gains are $30.0 million. There are no aggregate realized capital losses or aggregate unrealized capital depreciation. Capital Gains Incentive Fee is calculated as $30.0 million × 20%. |
(3) | Aggregate realized capital gains are $30.0 million. There are no aggregate realized capital losses and there is $5.0 million in aggregate unrealized capital depreciation. Capital Gains Incentive Fee is calculated as the greater of (i) zero and (ii) ($30.0 million - $5.0 million) × 20% less $6.0 million (aggregate Capital Gains Incentive Fee paid in prior years). |
(4) | Aggregate realized capital gains are $31.0 million. There are no aggregate realized capital losses or aggregate unrealized capital depreciation. Capital Gains Incentive Fee is calculated as the greater of (i) zero and (ii) $31.0 million × 20% less $6.0 million (aggregate Capital Gains Incentive Fee paid in prior years). |
(5) | There is no Capital Gains Incentive Fee in Year 5 as there are no aggregate realized capital gains for which Capital Gains Incentive Fee has not already been paid in prior years. |
(6) | Aggregate realized capital gains are $30.0 million. There are no aggregate realized capital losses and there is $5.0 million in aggregate unrealized capital depreciation. Capital Gains Incentive Fee is calculated as the greater of (i) zero and (ii) ($30.0 million - $5.0 million) × 20%. There have been no Capital Gains Incentive Fees paid in prior years. |
(7) | Aggregate realized capital gains are $35.0 million. There are no aggregate realized capital losses and there is $6.0 million in aggregate unrealized capital depreciation. Capital Gains Incentive Fee is calculated as the greater of (i) zero and (ii) ($35.0 million - $6.0 million) × 20% less $5.0 million (aggregate Capital Gains Incentive Fee paid in prior years). |
(8) | Aggregate realized capital gains are $35.0 million. There are no aggregate realized capital losses or aggregate unrealized capital depreciation. Capital Gains Incentive Fee is calculated as the greater of (i) zero and (ii) $35.0 million × 20% less $5.8 million (aggregate Capital Gains Incentive Fee paid in prior years). |
(9) | Aggregate realized capital gains are $35.0 million. Aggregate realized capital losses are $10.0 million. There is no aggregate unrealized capital depreciation. Capital Gains Incentive Fee is calculated as the greater of (i) zero and (ii) ($35.0 million - $10.0 million) × 20% less $7.0 million (aggregate Capital Gains Incentive Fee paid in prior years). |
• | our organizational expenses; |
• | fees and expenses, including reasonable travel expenses, actually incurred by GECM or payable to third parties related to our investments, including, among others, professional fees (including the fees and expenses of counsel, consultants and experts) and fees and expenses relating to, or associated with, evaluating, monitoring, researching and performing due diligence on investments and prospective investments (including payments to third party vendors for financial information services); |
• | out-of-pocket fees and expenses, including reasonable travel expenses, actually incurred by GECM or payable to third parties related to the provision of managerial assistance to our portfolio companies that we agree to provide such services to under the Investment Company Act (exclusive of the compensation of any investment professionals of GECM); |
• | interest or other costs associated with debt, if any, incurred to finance our business; |
• | fees and expenses incurred in connection with our membership in investment company organizations; |
• | brokers’ commissions; |
• | investment advisory and management fees; |
• | fees and expenses associated with calculating our net asset value (including the costs and expenses of any independent valuation firm); |
• | fees and expenses relating to offerings of our common stock and other securities; |
• | legal, auditing or accounting expenses; |
• | federal, state and local taxes and other governmental fees; |
• | the fees and expenses of GECM, in its role as the administrator, and any sub-administrator, our transfer agent or sub-transfer agent, and any other amounts payable under the Administration Agreement, or any similar administration agreement or sub-administration agreement to which we may become a party; |
• | the cost of preparing stock certificates or any other expenses, including clerical expenses of issue, redemption or repurchase of our securities; |
• | the expenses of and fees for registering or qualifying our common stock for sale and of maintaining our registration and registering us as a broker or a dealer; |
• | the fees and expenses of our directors who are not interested persons (as defined in the Investment Company Act); |
• | the cost of preparing and distributing reports, proxy statements and notices to stockholders, the SEC and other governmental or regulatory authorities; |
• | costs of holding stockholders’ meetings; |
• | listing fees; |
• | the fees or disbursements of custodians of our assets, including expenses incurred in the performance of any obligations enumerated by our bylaws or amended and restated articles of incorporation insofar as they govern agreements with any such custodian; |
• | our allocable portion of the fidelity bond, directors and officers/errors and omissions liability insurance, and any other insurance premiums; |
• | our allocable portion of the costs associated with maintaining any computer software, hardware or information technology services (including information systems, Bloomberg or similar terminals, cyber security and related consultants and email retention) that are used by us or by GECM or its respective affiliates on our behalf (which allocable portion shall exclude any such costs related to investment professionals of GECM providing services to us); |
• | direct costs and expenses incurred by us or GECM in connection with the performance of administrative services on our behalf, including printing, mailing, long distance telephone, cellular phone and data service, copying, secretarial and other staff, independent auditors and outside legal costs; |
• | all other expenses incurred by us or GECM in connection with administering our business (including payments under the Administration Agreement) based upon our allocable portion of GECM’s overhead in performing its obligations under the Administration Agreement, including rent and the allocable portion of the cost of our Chief Financial Officer and Chief Compliance Officer and their respective staffs (including reasonable travel expenses); and |
• | costs incurred by us in connection with any claim, litigation, arbitration, mediation, government investigation or dispute in connection with our business and the amount of any judgment or settlement paid in connection therewith, or the enforcement of our rights against any person and indemnification or contribution expenses payable by us to any person and other extraordinary expenses not incurred in the ordinary course of our business. |
• | the nature, quality and extent of the advisory and other services to be provided to us by GECM; |
• | the investment performance of us and GECM; |
• | the extent to which economies of scale would be realized as we grow, and whether the fees payable under the Investment Management Agreement reflect these economies of scale for the benefit of our stockholders; |
• | comparative data with respect to advisory fees or similar expenses paid by other BDCs with similar investment objectives; |
• | our projected operating expenses and expense ratio compared to BDCs with similar investment objectives; |
• | existing and potential sources of indirect income to GECM from its relationship with us and the profitability of those income sources; |
• | information about the services to be performed and the personnel performing such services under the Investment Management Agreement; |
• | the organizational capability and financial condition of GECM and its affiliates; and |
• | the possibility of obtaining similar services from other third party service providers or through an internally managed structure. |
• | 67% or more of such company’s voting securities present at a meeting if more than 50% of the outstanding voting securities of such company are present or represented by proxy, or |
• | more than 50% of the outstanding voting securities of such company. |
• | in connection with a rights offering to our existing stockholders (the “Rights Offering”), |
• | with the consent of the majority of our common stockholders, or |
• | under such other circumstances as the SEC may permit. |
• | securities purchased in transactions not involving any public offering, the issuer of which is an eligible portfolio company; |
• | securities received in exchange for or distributed with respect to securities described in the bullet above or pursuant to the exercise of options, warrants or rights relating to such securities; and |
• | cash, cash items, government securities or high quality debt securities (within the meaning of the Investment Company Act), maturing in one year or less from the time of investment. |
• | does not have a class of securities with respect to which a broker may extend margin credit at the time the acquisition is made; |
• | is controlled by the BDC and has an affiliate of the BDC on its board of directors; |
• | does not have any class of securities listed on a national securities exchange; |
• | is a public company that lists its securities on a national securities exchange with a market capitalization of less than $250.0 million; or |
• | meets such other criteria as may be established by the SEC. |
• | our investment company taxable income (which includes, among other items, dividends, interest and the excess of any net short-term capital gain over net long-term capital loss and other taxable income (other than any net capital gain), reduced by deductible expenses) determined without regard to the deduction for dividends and distributions paid; and |
• | net tax exempt interest income (which is the excess of our gross tax exempt interest income over certain disallowed deductions) (the “Annual Distribution Requirement”). |
• | at least 98% of our ordinary income (not taking into account any capital gains or losses) for the calendar year; |
• | at least 98.2% of the amount by which our capital gains exceed our capital losses (adjusted for certain ordinary losses) for a one-year period generally ending on October 31 of the calendar year (unless an election is made by us to use our taxable year); and |
• | certain undistributed amounts from previous years on which we paid no U.S. federal income tax. |
• | disallow, suspend or otherwise limit the allowance of certain losses or deductions, including the dividends received deduction; |
• | convert lower taxed long-term capital gain and qualified dividend income into higher taxed short-term capital gain or ordinary income; |
• | convert ordinary loss or a deduction into capital loss (the deductibility of which is more limited); |
• | cause us to recognize income or gain without a corresponding receipt of cash; |
• | adversely affect the time as to when a purchase or sale of stock or securities is deemed to occur; |
• | adversely alter the characterization of certain complex financial transactions; and |
• | produce income that will not qualify as “good income” for purposes of the 90% annual gross income requirement described above. |
Portfolio Company | | | Industry | | | Security(1) | | | Notes | | | Interest Rate(2) | | | Initial Acquisition Date | | | Maturity | | | Par Amount / Quantity | | | Cost | | | Fair Value | | | Percentage of Class(15) |
Investments at Fair Value | ||||||||||||||||||||||||||||||
ABB/Con-Cise Optical Group LLC 12301 NW 39th Street Coral Springs, FL 33065 | | | Wholesale-Apparel, Piece Goods & Notions | | | 1st Lien, Secured Loan | | | 5 | | | 3M L + 5.00%, 6.00% Floor (6.00%) | | | 12/01/2020 | | | 06/15/2023 | | | $2,977 | | | $2,787 | | | $2,849 | | | |
AgroFresh Inc. One Washington Square 510-530 Walnut Street, Suite 1350 Philadelphia, PA 19106 | | | Chemicals | | | 1st Lien, Secured Loan | | | | | 1M L + 6.25%, 7.25% Floor (7.25%) | | | 03/31/2021 | | | 12/31/2024 | | | 3,464 | | | 3,471 | | | 3,470 | | | ||
APTIM Corp. 4171 Essen Lane, Baton Rouge, LA 70809 | | | Industrial | | | 1st Lien, Secured Bond | | | 11 | | | 7.75% | | | 03/28/2019 | | | 06/15/2025 | | | 3,000 | | | 2,557 | | | 2,636 | | | |
Avanti Communications Group PLC Cobham House 20 Black Friars Lane London, UK EC4V 6EB | | | Wireless Telecommunications Services | | | 1.125 Lien, Secured Loan | | | 4, 5, 6, 10, 11, 12 | | | 12.50% | | | 02/16/2021 | | | 07/31/2022 | | | 4,171 | | | 4,171 | | | 4,171 | | | |
Avanti Communications Group PLC Cobham House 20 Black Friars Lane London, UK EC4V 6EB | | | Wireless Telecommunications Services | | | 1.25 Lien, Secured Loan | | | 4, 5, 6, 10, 11, 12 | | | 12.50% | | | 04/28/2020 | | | 07/31/2022 | | | 1,220 | | | 1,220 | | | 1,220 | | | |
Avanti Communications Group PLC Cobham House 20 Black Friars Lane London, UK EC4V 6EB | | | Wireless Telecommunications Services | | | 1.5 Lien, Secured Loan | | | 4, 5, 6, 10, 11, 12 | | | 12.50% | | | 05/24/2019 | | | 07/31/2022 | | | 10,110 | | | 10,110 | | | 10,110 | | | |
Avanti Communications Group PLC Cobham House 20 Black Friars Lane London, UK EC4V 6EB | | | Wireless Telecommunications Services | | | 2nd Lien, Secured Bond | | | 4, 5, 6, 10, 11 | | | 9.00% | | | 11/03/2016 | | | 10/01/2022 | | | 48,462 | | | 46,907 | | | 19,440 | | | |
Avanti Communications Group PLC Cobham House 20 Black Friars Lane London, UK EC4V 6EB | | | Wireless Telecommunications Services | | | Common Equity | | | 4, 5, 7, 10 | | | n/a | | | 11/03/2016 | | | n/a | | | 196,086,410 | | | 50,660 | | | — | | | 9.06% |
Best Western Luling 3100 Richmond Ave, Houston, TX 77098 | | | Hotel Operator | | | 1st Lien, Secured Loan | | | 5, 8, 9 | | | 1M L + 12.00%, 12.25% Floor (0.00%) | | | 11/03/2016 | | | 12/18/2017 | | | 2,715 | | | 1,300 | | | 165 | | |
Portfolio Company | | | Industry | | | Security(1) | | | Notes | | | Interest Rate(2) | | | Initial Acquisition Date | | | Maturity | | | Par Amount / Quantity | | | Cost | | | Fair Value | | | Percentage of Class(15) |
Blueknight Energy Partners L.P. 6060 American Plaza, Suite 600, Tulsa, OK 74135 | | | Oil & Gas | | | Series A Preferred Units | | | | | n/a | | | 10/07/2020 | | | n/a | | | 161,993 | | | 968 | | | 1,327 | | | 0.47% | |
California Pizza Kitchen, Inc. 12181 Bluff Creek Drive, Playa Vista, CA 90094 | | | Restaurants | | | 1st Lien, Secured Loan | | | 5 | | | 3M L + 10.00%, 11.50% Floor (11.50%) | | | 11/23/2020 | | | 11/23/2024 | | | 9,839 | | | 9,395 | | | 9,839 | | | |
California Pizza Kitchen, Inc. 12181 Bluff Creek Drive, Playa Vista, CA 90094 | | | Restaurants | | | Common Equity | | | 5, 7 | | | n/a | | | 11/23/2020 | | | n/a | | | 100,000 | | | 8,817 | | | 5,591 | | | 2.50% |
Cleaver-Brooks, Inc. 221 Law Street Thomasville, GA 31792 | | | Industrial | | | Secured Bond | | | | | 7.88% | | | 05/05/2021 | | | 03/01/2023 | | | 2,203 | | | 2,195 | | | 2,181 | | | ||
Crestwood Equity Partners LP 811 Main Street, Suite 3400 Houston, TX 77002 | | | Oil & Gas | | | Class A Preferred Equity Units | | | 10 | | | n/a | | | 06/19/2020 | | | n/a | | | 1,345,795 | | | 7,954 | | | 12,624 | | | 1.89% |
Davidzon Radio, Inc. 2508 Coney Island Avenue, 2nd Floor Brooklyn, NY 1122 | | | Radio Broadcasting | | | 1st Lien, Secured Loan | | | 5, 8, 9 | | | 1M L + 10.00%, 11.00% Floor (0.00%) | | | 11/03/2016 | | | 03/31/2020 | | | 8,962 | | | 8,962 | | | 3,335 | | | |
ECL Entertainment, LLC 8978 Spanish Ridge Ave Las Vegas, NV 89148 | | | Media & Entertainment | | | 1st Lien, Secured Loan | | | 5 | | | 1M L + 7.50%, 8.25% Floor (8.25%) | | | 03/31/2021 | | | 04/30/2028 | | | 2,500 | | | 2,476 | | | 2,500 | | | |
Finastra Group Holdings, Ltd. 285 Madison Avenue, New York, NY 10017 | | | Software Services | | | 2nd Lien, Secured Loan | | | 10 | | | 6M L + 7.25%, 8.25% Floor (8.25%) | | | 12/14/2017 | | | 06/13/2025 | | | 2,000 | | | 1,952 | | | 2,018 | | | |
First Brands, Inc. 3255 West Hamlin Road, Rochester Hills, MI 48309 | | | Transportation Equipment Manufacturing | | | 2nd Lien, Secured Loan | | | 5 | | | 3M L + 8.50%, 9.50% Floor (9.50%) | | | 03/24/2021 | | | 03/24/2028 | | | 6,000 | | | 5,883 | | | 6,032 | | | |
Gateway Casinos & Entertainment Limited 100-4400 Dominion Street, Burnaby BC V5G 4G3 | | | Casinos & Gaming | | | 2nd Lien, Secured Note | | | 10 | | | 8.25% | | | 11/17/2020 | | | 03/01/2024 | | | 5,000 | | | 4,611 | | | 4,999 | | | |
The GEO Group, Inc. 4955 Technology Way, Boca Raton, FL 33431 | | | Consumer Services | | | Unsecured Bond | | | | | 5.88% | | | 03/09/2021 | | | 10/15/2024 | | | 3,000 | | | 2,417 | | | 2,685 | | | ||
Greenway Health, LLC 4301 W. Boy Scout Blvd, Suite 800 Tampa, FL 33607 | | | Technology | | | 1st Lien, Revolver | | | 5 | | | 3M L+ 3.75%, 3.75% Floor (3.90%) | | | 01/27/2020 | | | 02/17/2022 | | | — | | | (352) | | | — | | | |
Greenway Health, LLC 4301 W. Boy Scout Blvd, Suite 800 Tampa, FL 33607 | | | Technology | | | 1st Lien, Revolver - Unfunded | | | 5 | | | 0.50% | | | 01/27/2020 | | | 02/17/2022 | | | 8,026 | | | — | | | (229) | | | |
Lenders Funding, LLC 523 A Avenue Coronado, CA 92118 | | | Specialty Finance | | | Receivable | | | 5 | | | 11.50% | | | 06/23/2021 | | | 06/23/2022 | | | 942 | | | 942 | | | 942 | | | |
Lenders Funding, LLC 523 A Avenue Coronado, CA 92118 | | | Specialty Finance | | | Receivable - Unfunded | | | 5 | | | n/a | | | 06/23/2021 | | | 06/23/2022 | | | 58 | | | — | | | — | | | |
Lenders Funding, LLC 523 A Avenue Coronado, CA 92118 | | | Specialty Finance | | | Receivable | | | 5 | | | 10.50% | | | 06/30/2021 | | | 06/30/2022 | | | 1,475 | | | 1,475 | | | 1,475 | | |
Portfolio Company | | | Industry | | | Security(1) | | | Notes | | | Interest Rate(2) | | | Initial Acquisition Date | | | Maturity | | | Par Amount / Quantity | | | Cost | | | Fair Value | | | Percentage of Class(15) |
Lenders Funding, LLC 523 A Avenue Coronado, CA 92118 | | | Specialty Finance | | | Receivable - Unfunded | | | 5 | | | n/a | | | 06/30/2021 | | | 06/30/2022 | | | 525 | | | — | | | — | | | |
Levey/Stormer 905 South Boulevard East Rochester Hills, MI 48307 | | | Specialty Finance | | | Loan | | | 5 | | | 12.50% | | | 05/13/2021 | | | 05/13/2024 | | | 1,884 | | | 1,785 | | | 1,884 | | | |
Levy/Stormer 905 South Boulevard East Rochester Hills, MI 48307 | | | Specialty Finance | | | Loan - Unfunded | | | 5 | | | 0.50% | | | 05/13/2021 | | | 05/13/2024 | | | 1,616 | | | — | | | — | | | |
Mad Engine Global, LLC 6740 Cobra Way, San Diego, CA, 92121 | | | Apparel | | | Term Loan | | | 5 | | | 1M L + 7.00%, 8.00% Floor (8.00%) | | | 06/30/2021 | | | 06/30/2027 | | | 5,000 | | | 4,875 | | | 4,875 | | | |
Martin Midstream Partners LP 4200 Stone Road, Kilgore, TX 75662 | | | Oil & Gas | | | 2nd Lien, Secured Note | | | | | 11.50% | | | 12/09/2020 | | | 02/28/2025 | | | 3,000 | | | 3,100 | | | 3,113 | | | ||
Mitchell International, Inc. 6220 Greenwich Drive San Diego, CA 92122 | | | Software Services | | | 2nd Lien, Secured Loan | | | | | 1M L + 7.25%, 7.25% Floor (7.35%) | | | 08/02/2019 | | | 12/01/2025 | | | 3,000 | | | 2,838 | | | 2,995 | | | ||
Monitronics International, Inc. 1990 Wittington Place, Dallas, TX 75234 | | | Home Security | | | Term Loan | | | | | 1M L + 6.50%, 7.75 Floor (7.75%) | | | 06/24/2021 | | | 03/29/2024 | | | 2,992 | | | 2,914 | | | 2,900 | | | ||
National CineMedia, Inc. 6300 S. Syracuse Way, Suite 300, Centennial, CO 80111 | | | Media & Entertainment | | | Secured Bond | | | | | 5.88% | | | 01/26/2021 | | | 04/15/2028 | | | 2,000 | | | 1,795 | | | 1,965 | | | ||
Natural Resource Partners LP 1201 Louisiana Street, Suite 3400 Houston, TX 77002 | | | Metals & Mining | | | Unsecured Notes | | | | | 9.13% | | | 06/12/2020 | | | 06/30/2025 | | | 7,462 | | | 6,837 | | | 7,313 | | | ||
OPS Acquisitions Limited and Ocean Protection Services Limited Churchill House, 1 London Road, London, UK SL3 7FI | | | Maritime Security Services | | | 1st Lien, Secured Loan | | | 4, 5, 8, 10 | | | 1M L + 12.00%, 12.50% Floor (0.00%) | | | 11/03/2016 | | | 06/01/2018 | | | 695 | | | 121 | | | 11 | | | |
OPS Acquisitions Limited and Ocean Protection Services Limited Churchill House, 1 London Road, London, UK SL3 7FI | | | Maritime Security Services | | | Common Equity | | | 4, 5, 7, 10 | | | n/a | | | 11/03/2016 | | | n/a | | | — | | | — | | | — | | | 19.00% |
Par Petroleum, LLC 825 Town & Country Lane, Suite 1500, Houston, TX 77024 | | | Oil & Gas | | | 1st Lien, Secured Note | | | 10 | | | 7.75% | | | 10/30/2020 | | | 12/15/2025 | | | 3,000 | | | 2,578 | | | 3,015 | | | |
Perforce Software, Inc. 400 First Avenue North #200 Minneapolis, MN 55401 | | | Technology | | | 1st Lien, Secured Revolver | | | 5 | | | 3M L + 4.25%, 4.25% Floor (4.40%) | | | 01/24/2020 | | | 07/01/2024 | | | — | | | (361) | | | — | | | |
Perforce Software, Inc. 400 First Avenue North #200 Minneapolis, MN 55401 | | | Technology | | | 1st Lien, Secured Revolver - Unfunded | | | 5 | | | 0.50% | | | 01/24/2020 | | | 07/01/2024 | | | 4,375 | | | — | | | (161) | | |
Portfolio Company | | | Industry | | | Security(1) | | | Notes | | | Interest Rate(2) | | | Initial Acquisition Date | | | Maturity | | | Par Amount / Quantity | | | Cost | | | Fair Value | | | Percentage of Class(15) |
PFS Holdings Corp. 3747 Hecktown Road Easton, PA 18045 | | | Food & Staples | | | 1st Lien, Secured Loan | | | 4, 5 | | | 3M L + 7.00%, 8.00% Floor (8.00%) | | | 11/13/2020 | | | 11/13/2024 | | | 1,071 | | | 1,071 | | | 1,071 | | | |
PFS Holdings Corp. 3747 Hecktown Road Easton, PA 18045 | | | Food & Staples | | | Common Equity | | | 4, 5, 7 | | | n/a | | | 11/13/2020 | | | n/a | | | 5,222 | | | 12,378 | | | 3,810 | | | 5.22% |
Prestige Capital Finance, LLC 400 Kelby St., 10th Floor Fort Lee, NJ 07024 | | | Specialty Finance | | | Secured Note | | | 3, 5 | | | 11.00% | | | 06/15/2021 | | | 06/15/2023 | | | 3,000 | | | 3,000 | | | 3,000 | | | |
Prestige Capital Finance, LLC 400 Kelby St., 10th Floor Fort Lee, NJ 07024 | | | Specialty Finance | | | Receivable | | | 3, 5 | | | 11.00% | | | 03/15/2021 | | | 03/15/2022 | | | 8,400 | | | 928 | | | 928 | | | |
Prestige Capital Finance, LLC 400 Kelby St., 10th Floor Fort Lee, NJ 07024 | | | Specialty Finance | | | Common Equity | | | 3, 5, 10 | | | n/a | | | 02/08/2019 | | | n/a | | | 100 | | | 7,466 | | | 11,447 | | | 80.00% |