NEWT-3.31.15-10Q
Table of Contents

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________________ 
FORM 10-Q
____________________________________________ 
(Mark One)    
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2015

OR

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

For the transition period from _____to_____
Commission file number: 814-01035
 
____________________________________________ 
NEWTEK BUSINESS SERVICES CORP.
 ____________________________________________ 

(Exact name of registrant as specified in its charter)
____________________________________________ 

  
Maryland
 
46-3755188
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)
 
 
 
212 West 35th Street, 2nd Floor New York, New York
 
10001
(Address of principal executive offices)
 
(Zip Code)
Registrant’s telephone number, including area code: (212) 356-9500
 ____________________________________________  

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company (all as defined in Rule 12b-2 of the Exchange Act).
 
Large accelerated filer
 
¨
Accelerated filer
 
¨
 
 
 
 
 
 
Non-accelerated filer
 
x
Smaller reporting company
 
¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x
As of May 11, 2015 there were 10,206,301 shares issued and outstanding of the registrant’s Common Stock, par value $0.02 per share.
 


Table of Contents

TABLE OF CONTENTS
 
 
 
Page
 
 
 
 
 
 
Item 1.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Item 2.
 
 
 
Item 3.
 
 
 
Item 4.
 
 
 
 
 
 
Item 1.
 
 
 
Item 1A.
 
 
 
Item 2.
 
 
 
Item 3.
 
 
 
Item 4.
 
 
 
Item 5.
 
 
 
Item 6.


Table of Contents


NEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF NET ASSETS AND LIABILITIES
(In Thousands, except for Per Share Data)
 
March 31, 2015
 
December 31, 2014
ASSETS
(Unaudited)
 
(Note 1)
Investments, at fair value
 
 
 
SBA unguaranteed non-affiliate investments (cost of $138,811 and $131,093, respectively; includes $122,194 and $120,990, respectively, related to securitization trust VIE)
$
128,551

 
$
121,477

Affiliate investments (cost of $17,965 and $18,065, respectively)
84,899

 
77,499

SBA guaranteed non-affiliate investments (cost of $12,993 and $28,057, respectively)
14,724

 
31,486

Investments in money market funds (cost of $6,000 and $3,000, respectively)
6,000

 
3,000

Total investments at fair value
234,174

 
233,462

Cash and cash equivalents
8,593

 
17,813

Restricted cash
17,246

 
15,389

Broker receivable
12,959

 

Due from related parties
4,049

 
3,190

Servicing assets, at fair value
10,363

 
9,483

Credits in lieu of cash
1,889

 
2,229

Other assets (includes $2,458 and $2,550, respectively, related to securitization trust VIE)
15,702

 
20,266

Total assets
$
304,975

 
$
301,832

LIABILITIES AND NET ASSETS
 
 
 
Liabilities:
 
 
 
Notes payable
$
42,697

 
$
43,023

Notes payable - Securitization trust VIE
76,945

 
79,520

Dividends payable
3,985

 

Due to related parties
2,720

 
2,867

Notes payable in credits in lieu of cash
1,889

 
2,229

Accounts payable, accrued expenses and other liabilities
7,173

 
7,775

Total liabilities
135,409

 
135,414

Commitments and contingencies
 
 
 
Net Assets:
 
 
 
Preferred stock (par value $0.02 per share; authorized 1,000 shares, no shares issued and outstanding)

 

Common stock (par value $0.02 per share; authorized 54,000 shares, 10,206 issued and outstanding at March 31, 2015 and December 31, 2014, respectively, not including 17 shares held in escrow)
205

 
205

Additional paid-in capital
162,662

 
165,532

Distributions in excess of net investment income
(8,984
)
 
(2,523
)
Net unrealized appreciation on investments
7,389

 
2,609

Net realized gains on investments
8,294

 
595

Total net assets
169,566

 
166,418

Total liabilities and net assets
$
304,975

 
$
301,832

Net asset value per common share
$
16.61

 
$
16.31

See accompanying notes to unaudited condensed consolidated financial statements.

1

Table of Contents

NEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In Thousands, except for Per Share Data)
 
As a Business Development Company
 
Prior to becoming a Business Development Company
 
Three Months Ended March 31, 2015
 
Three Months Ended March 31, 2014
Investment income:
 
 
 
From non-controlled/non-affiliate investments
 
 
 
Interest income
$
2,125

 
$

Servicing income
1,043

 

Other income
395

 

Total investment income from non-controlled/non-affiliate investments
3,563

 

From controlled/affiliate investments
 
 
 
Interest income
88

 

Dividend income
1,087

 

Other income
12

 

Total investment income from controlled/affiliate investments
1,187

 

Total investment income
4,750

 

Operating revenues:
 
 
 
Electronic payment processing

 
21,527

Web hosting and design

 
3,987

Premium income

 
5,137

Interest income

 
1,561

Servicing fee income – NSBF portfolio

 
832

Servicing fee income – external portfolios

 
1,793

Income from tax credits

 
13

Insurance commissions

 
385

Other income

 
852

Total operating revenues

 
36,087

Net change in fair value of:
 
 
 
SBA loans

 
(1,266
)
Credits in lieu of cash and notes payable in credits in lieu of cash

 
1

Total net change in fair value

 
(1,265
)
Expenses:
 
 
 
Electronic payment processing costs

 
18,362

Salaries and benefits
3,023

 
6,478

Interest
1,356

 
1,636

Depreciation and amortization
85

 
855

Provision for loan losses

 
(205
)
Other general and administrative costs
2,762

 
5,480

Total expenses
7,226

 
32,606

Net investment loss
(2,476
)
 

Net realized and unrealized gain (loss):
 
 
 
Net realized gain on non-affiliate investments
7,699

 

Net unrealized depreciation on SBA guaranteed non-affiliate investments
(1,698
)
 


2

Table of Contents

 
As a Business Development Company
 
Prior to becoming a Business Development Company
 
Three Months Ended March 31, 2015
 
Three Months Ended March 31, 2014
Net unrealized depreciation on SBA unguaranteed non-affiliate investments
(666
)
 

Net unrealized appreciation on affiliate investments
7,500

 

Net unrealized depreciation on servicing assets
(356
)
 

Net realized and unrealized gains
12,479

 

Income before income taxes

 
2,216

Net increase in net assets
$
10,003

 
$

Provision for income taxes

 
849

Net income

 
1,367

Net loss attributable to non-controlling interests

 
24

Net income attributable to Newtek Business Services Corp.
$

 
$
1,391

Weighted average common shares outstanding:
 
 
 
Basic

 
7,086

Diluted

 
7,677

Basic income per share
$

 
$
0.20

Diluted income per share
$

 
$
0.18

Net increase in net assets per share
$
0.98

 
$

Net investment loss per share
$
(0.24
)
 
$

Dividends and distributions declared per common share
$
0.39

 
$

Weighted average shares outstanding
10,206

 

See accompanying notes to unaudited condensed consolidated financial statements.

3

Table of Contents

NEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS
(In Thousands)
 
 
Number of
Shares of
Common
Stock
 
Common
Stock
 
Additional
Paid-in
Capital
 
Distributions in Excess of Net Investment Income
 
Net Unrealized Appreciation
 
Net Realized Gains
Total
Balance at December 31, 2014
10,206

 
$
205

 
$
165,532

 
$
(2,523
)
 
$
2,609

 
$
595

$
166,418

Net increase in net assets from operations

 

 

 
(2,476
)
 
4,780

 
7,699

10,003

Distributions to stockholders

 

 

 
(3,985
)
 

 

(3,985
)
Reversal of deferred tax asset

 

 
(2,870
)
 

 

 

(2,870
)
Balance at March 31, 2015
10,206

 
$
205

 
$
162,662

 
$
(8,984
)
 
$
7,389

 
$
8,294

$
169,566



See accompanying notes to unaudited condensed consolidated financial statements.

4

Table of Contents

NEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In Thousands)
 
 
As a Business Development Company
 
Prior to becoming a Business Development Company
 
Three Months Ended March 31, 2015
 
Three Months Ended March 31, 2014
Cash flows from operating activities:
 
 
 
Net increase in net assets/net income
$
10,003

 
$
1,367

Adjustments to reconcile net increase in net assets/net income to net cash provided by (used in) operating activities:
 
 
 
Net unrealized appreciation on affiliate investments
(7,500
)
 

Net unrealized depreciation on non-affiliate investments
2,364

 

Net unrealized depreciation on servicing assets
356

 

Income from tax credits
(8
)
 
(13
)
Accretion of interest expense
8

 
14

Fair value adjustments on SBA loans

 
1,266

Fair value adjustment of credits in lieu of cash and notes payable in credits in lieu of cash

 
(1
)
Deferred income taxes

 
(319
)
Depreciation and amortization
85

 
855

Funding of affiliate investments
(200
)
 

Originations of SBA guaranteed non-affiliate investments
(37,288
)
 

Principal payments received on affiliate investments
300

 

Proceeds from sale of SBA guaranteed non-affiliate investments
52,349

 

Originations of SBA unguaranteed non-affiliate investments
(12,340
)
 

Payments received on SBA unguaranteed non-affiliate investments
4,193

 

Accretion of discount
49

 
70

Provision for loan losses

 
(205
)
Other, net
196

 
643

Changes in operating assets and liabilities:
 
 
 
Net increase in investments in money market funds
(3,000
)
 

Originations of SBA loans held for sale

 
(34,224
)
Proceeds from sale of SBA loans held for sale

 
34,955

Broker receivable
(12,959
)
 
700

Due to/from related parties
(1,006
)
 

Accounts receivable
109

 
(263
)
Prepaid expenses, accrued interest receivable and other assets
1,673

 
4,636

Accounts payable, accrued expenses, other liabilities and deferred revenue
(541
)
 
(778
)
Change in restricted cash
(6,039
)
 

Capitalized servicing assets
(1,236
)
 

Other, net

 
(875
)
Net cash provided by (used in) operating activities
(10,432
)
 
7,828

Cash flows from investing activities:
 
 
 

5

Table of Contents

 
As a Business Development Company
 
Prior to becoming a Business Development Company
 
Three Months Ended March 31, 2015
 
Three Months Ended March 31, 2014
Investments in qualified businesses

 
(72
)
Purchase of fixed assets and customer accounts
(12
)
 
(588
)
SBA loans originated for investment, net

 
(11,385
)
Payments received on SBA loans

 
2,159

Net cash used in investing activities
(12
)
 
(9,886
)
Cash flows from financing activities:
 
 
 
Net borrowings/(repayments) on bank lines of credit
91

 
(3,977
)
Payments on bank term note payable
(417
)
 
(104
)
Payments on senior notes
(2,624
)
 
(2,355
)
Change in restricted cash related to securitization
4,182

 
6,323

Additions to deferred financing costs
(4
)
 
(11
)
Other, net
(4
)
 
(92
)
Net cash provided by (used in) financing activities
1,224

 
(216
)
Net decrease in cash and cash equivalents
(9,220
)
 
(2,274
)
Cash and cash equivalents—beginning of period
17,813

 
12,508

Cash and cash equivalents—end of period
$
8,593

 
$
10,234

Supplemental disclosure of cash flow activities:
 
 
 
Non-cash investing and financing activities:
 
 
 
Reduction of credits in lieu of cash and notes payable in credits in lieu of cash balances due to delivery of tax credits to Certified Investors
$
348

 
$
417

Foreclosed real estate acquired by portfolio company
$
409

 
$

Dividends declared
$
3,985

 
$

Reversal of deferred tax asset
$
2,870

 
$

See accompanying notes to unaudited condensed consolidated financial statements.



6

Table of Contents

NEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS (UNAUDITED) MARCH 31, 2015
(In Thousands)

Portfolio Company
 
Industry
 
Type of Investment
 
Interest Rate (2)
 
Maturity
 
Principal
 
Cost
 
Fair Value
 
% of Net Assets
Performing SBA Unguaranteed Investments (1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
MMS Realty, LLC and Molecular MS Diagnostics, LLC
 
Professional, Scientific, and Technical Services
 
Term Loan
 
Prime plus 2.75%
 
3/18/2040

 
$
160.7

 
$
160.7

 
$
149.2

 
0.09
%
Gurtej Singh and Ranjit Kaur dba Food Fair Market
 
Food and Beverage Stores
 
Term Loan
 
Prime plus 2.75%
 
3/18/2025

 
22.5

 
22.5

 
17.9

 
0.01
%
R & R Security and Investigations Inc. dba Pardners Lake Buchanan
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
3/19/2040

 
85.4

 
85.4

 
85.7

 
0.05
%
Shelton Incorporated dba Mrs. Winners
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
3/20/2040

 
112.5

 
112.5

 
111.6

 
0.07
%
CML RW Security, LLC
 
Construction of Buildings
 
Term Loan
 
Prime plus 2.75%
 
3/20/2025

 
575.0

 
575.0

 
458.3

 
0.27
%
Jaymie Hazard dba Indigo Hair Studio and Day Spa
 
Personal and Laundry Services
 
Term Loan
 
Prime plus 2.75%
 
3/20/2040

 
42.9

 
42.9

 
40.2

 
0.02
%
GPG Enterprises, LLC dba Angel Animal Hospital & Boarding
 
Professional, Scientific, and Technical Services
 
Term Loan
 
Prime plus 2.75%
 
3/24/2040

 
67.5

 
67.5

 
63.8

 
0.04
%
Loriet, LLC
 
Merchant Wholesalers, Nondurable Goods
 
Term Loan
 
Prime plus 2.75%
 
3/24/2025

 
12.0

 
12.0

 
9.6

 
0.01
%
Zero-In Media Inc.
 
Data Processing, Hosting, and Related Services
 
Term Loan
 
Prime plus 2.75%
 
3/25/2025

 
22.5

 
22.5

 
17.9

 
0.01
%
Geo Los Angeles, LLC dba Geo Film Group
 
Rental and Leasing Services
 
Term Loan
 
Prime plus 2.75%
 
3/26/2025

 
130.0

 
130.0

 
114.8

 
0.07
%
Joyce Outdoor Advertising NJ, LLC and Joyce Outdoor Advertising, LLC
 
Professional, Scientific, and Technical Services
 
Term Loan
 
Prime plus 2.75%
 
3/26/2040

 
54.0

 
54.0

 
54.2

 
0.03
%
Carpet Exchange of North Texas Inc. and Clyde E. Cumbie Jr.
 
Furniture and Home Furnishings Stores
 
Term Loan
 
Prime plus 2.75%
 
3/26/2040

 
810.0

 
810.0

 
801.0

 
0.47
%
South Florida Air Conditioning and Refrigeration Corp.
 
Specialty Trade Contractors
 
Term Loan
 
Prime plus 2.75%
 
3/27/2040

 
155.5

 
155.5

 
152.3

 
0.09
%
Shorr Enterprises Inc. dba New Design Furniture Manufacturers
 
Furniture and Related Product Manufacturing
 
Term Loan
 
Prime plus 2.75%
 
3/27/2025

 
106.5

 
106.5

 
94.8

 
0.06
%
Shellhorn and Hill Inc. dba Total Fleet Service
 
Nonstore Retailers
 
Term Loan
 
Prime plus 2.75%
 
3/27/2040

 
1,040.3

 
1,040.3

 
925.6

 
0.55
%
Foresite Realty Partners, LLC and Foresite Real Estate Holdings, LLC
 
Real Estate
 
Term Loan
 
Prime plus 2.75%
 
3/27/2025

 
1,238.3

 
1,238.3

 
987.0

 
0.58
%
Sunset Marine Resort, LLC and GoXpeditions, LLC
 
Accommodation
 
Term Loan
 
Prime plus 2.75%
 
3/27/2040

 
301.8

 
301.8

 
302.7

 
0.18
%

7

Table of Contents

Portfolio Company
 
Industry
 
Type of Investment
 
Interest Rate (2)
 
Maturity
 
Principal
 
Cost
 
Fair Value
 
% of Net Assets
Balthazar Management Virgin Islands, LLC dba The Beach Café
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
3/27/2025

 
123.3

 
123.3

 
121.5

 
0.07
%
Copper Beech Financial Group, LLC
 
Insurance Carriers and Related Activities
 
Term Loan
 
Prime plus 2.75%
 
3/30/2025

 
125.0

 
125.0

 
109.4

 
0.06
%
Delta Aggrigate, LLC
 
Mining (except Oil and Gas)
 
Term Loan
 
Prime plus 2.75%
 
3/30/2025

 
90.0

 
90.0

 
88.8

 
0.05
%
The Merrin Group, LLC dba Havana Central
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
3/31/2025

 
250.0

 
250.0

 
239.5

 
0.14
%
Advance Case RE Holdings, LLC and Advance Case Parts Inc.
 
Repair and Maintenance
 
Term Loan
 
Prime plus 2.75%
 
3/31/2040

 
758.3

 
624.0

 
559.9

 
0.33
%
T and B Boots Inc. dba Takkens
 
Clothing and Clothing Accessories Stores
 
Term Loan
 
Prime plus 2.75%
 
3/31/2025

 
807.8

 
807.8

 
722.3

 
0.43
%
Quest Logic Investments, LLC and Kleiner Investments, LLC
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
3/31/2025

 
22.5

 
22.5

 
22.2

 
0.01
%
Mid-South Lumber Co. of Northwest Florida, Inc.
 
Merchant Wholesalers, Durable Goods
 
Term Loan
 
Prime plus 2.75%
 
3/31/2040

 
428.8

 
428.8

 
381.5

 
0.22
%
Jatcoia 60056, LLC dba Style Encore
 
Clothing and Clothing Accessories Stores
 
Term Loan
 
Prime plus 2.75%
 
3/31/2025

 
22.3

 
22.3

 
20.2

 
0.01
%
Triangle Trash, LLC dba Bin There Dump That
 
Waste Management and Remediation Services
 
Term Loan
 
Prime plus 2.75%
 
2/18/2025

 
74.4

 
74.4

 
64.5

 
0.04
%
Kiddie Steps 4 You Inc.
 
Social Assistance
 
Term Loan
 
Prime plus 2.75%
 
2/20/2040

 
61.8

 
61.8

 
56.9

 
0.03
%
Nelson Financial Services, LLC
 
Professional, Scientific, and Technical Services
 
Term Loan
 
Prime plus 2.75%
 
2/24/2025

 
12.5

 
12.5

 
9.9

 
0.01
%
Pace Motor Lines, Inc.
 
Truck Transportation
 
Term Loan
 
Prime plus 2.75%
 
2/26/2025

 
66.2

 
66.2

 
64.3

 
0.04
%
Kingseal, LLC dba Desoto Health and Rehab Center
 
Nursing and Residential Care Facilities
 
Term Loan
 
Prime plus 2.75%
 
2/26/2040

 
1,250.0

 
1,250.0

 
1,253.8

 
0.74
%
J&M Concessions Inc, dba A 1 Liquors
 
Food and Beverage Stores
 
Term Loan
 
Prime plus 2.75%
 
2/27/2025

 
87.5

 
87.4

 
75.2

 
0.04
%
Calhoun Satellite Communications Inc. and Transmission Solutions Group
 
Broadcasting (except Internet)
 
Term Loan
 
Prime plus 2.75%
 
2/27/2025

 
952.8

 
952.8

 
801.0

 
0.47
%
Road to Sedona Inc.
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
2/27/2025

 
56.6

 
56.6

 
46.0

 
0.03
%
Baystate Firearms and Training, LLC
 
Educational Services
 
Term Loan
 
Prime plus 2.75%
 
2/27/2025

 
63.4

 
63.4

 
51.1

 
0.03
%
Luigi's on Main, LLC and Luigi's Main Street Pizza Inc.
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
3/4/2025

 
11.3

 
11.3

 
11.1

 
0.01
%
Douglas Printy Motorsports, Inc. dba Blackburn Trike
 
Motor Vehicle and Parts Dealers
 
Term Loan
 
Prime plus 2.75%
 
3/10/2040

 
191.8

 
191.8

 
178.0

 
0.10
%
Summit Treatment Services Inc.
 
Social Assistance
 
Term Loan
 
Prime plus 2.75%
 
3/11/2025

 
22.5

 
22.5

 
18.8

 
0.01
%

8

Table of Contents

Portfolio Company
 
Industry
 
Type of Investment
 
Interest Rate (2)
 
Maturity
 
Principal
 
Cost
 
Fair Value
 
% of Net Assets
Firm Foundations Inc.
 
Specialty Trade Contractors
 
Term Loan
 
Prime plus 2.75%
 
3/13/2025

 
81.3

 
81.3

 
80.1

 
0.05
%
BND Sebastian Limited Liability Company
 
Amusement, Gambling, and Recreation Industries
 
Term Loan
 
Prime plus 2.75%
 
3/16/2040

 
172.5

 
172.5

 
166.8

 
0.10
%
Royal Crest Motors, LLC
 
Motor Vehicle and Parts Dealers
 
Term Loan
 
Prime plus 2.75%
 
3/16/2040

 
91.3

 
91.3

 
86.6

 
0.05
%
Jung Design Inc.
 
Professional, Scientific, and Technical Services
 
Term Loan
 
Prime plus 2.75%
 
1/20/2022

 
8.4

 
8.3

 
6.6

 
%
Palmabak Inc. dba Mami Nora's
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
1/22/2025

 
21.5

 
21.3

 
20.8

 
0.01
%
DocMagnet Inc.
 
Professional, Scientific, and Technical Services
 
Term Loan
 
Prime plus 2.75%
 
1/23/2025

 
22.5

 
22.4

 
18.6

 
0.01
%
Limameno, LLC dba Sal's Italian Ristorante
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
1/23/2025

 
83.3

 
82.7

 
68.4

 
0.04
%
Dean 1021, LLC dba Pure Pita
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
4/29/2025

 
80.0

 
47.2

 
39.0

 
0.02
%
DuCharme Realty, LLC and DuCharme Enterprises, LLC
 
Wood Product Manufacturing
 
Term Loan
 
Prime plus 2.75%
 
2/2/2040

 
225.1

 
225.1

 
204.8

 
0.12
%
Kostekos Inc. dba New York Style Pizza
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
2/6/2040

 
66.3

 
66.3

 
62.5

 
0.04
%
740 Barry Street Realty, LLC and Wild Edibles Inc.
 
Merchant Wholesalers, Nondurable Goods
 
Term Loan
 
Prime plus 2.75%
 
2/10/2040

 
492.5

 
492.5

 
494.0

 
0.29
%
Silva Realty Holdings, LLC and MF-Silva Enterprises, Inc.
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
2/11/2040

 
171.6

 
171.6

 
158.3

 
0.09
%
B & W Towing, LLC and Boychucks Fuel, LLC
 
Repair and Maintenance
 
Term Loan
 
Prime plus 2.75%
 
12/17/2039

 
164.5

 
164.0

 
151.0

 
0.09
%
MM and M Management Inc. dba Pizza Artista
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
4/19/2025

 
46.3

 
46.3

 
37.8

 
0.02
%
B.S. Ventures, LLC dba Dink's Market
 
Merchant Wholesalers, Nondurable Goods
 
Term Loan
 
Prime plus 2.75%
 
12/19/2039

 
53.8

 
53.6

 
53.4

 
0.03
%
Will Zac Management, LLC dba Papa John's
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
12/19/2024

 
48.8

 
48.2

 
47.5

 
0.03
%
The Jewelers Inc. dba The Jewelers of Las Vegas
 
Clothing and Clothing Accessories Stores
 
Term Loan
 
Prime plus 2.75%
 
12/19/2024

 
1,250.0

 
1,235.2

 
997.1

 
0.59
%
Beale Street Blues Company-West Palm Beach, LLC
 
Performing Arts, Spectator Sports, and Related Industries
 
Term Loan
 
Prime plus 2.75%
 
12/22/2024

 
187.5

 
185.2

 
157.1

 
0.09
%
The Lodin Group, LLC and Lodin Health Imaging Inc.
 
Ambulatory Health Care Services
 
Term Loan
 
Prime plus 2.75%
 
12/23/2039

 
530.3

 
528.7

 
472.1

 
0.28
%
401 JJS Corporation and G Randazzo's Trattoria Corporation
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
12/23/2039

 
473.5

 
411.3

 
409.1

 
0.24
%

9

Table of Contents

Portfolio Company
 
Industry
 
Type of Investment
 
Interest Rate (2)
 
Maturity
 
Principal
 
Cost
 
Fair Value
 
% of Net Assets
Thermoplastic Services Inc. and Paragon Plastic Sheet, Inc
 
Plastics and Rubber Products Manufacturing
 
Term Loan
 
Prime plus 2.75%
 
12/23/2039

 
500.0

 
498.5

 
500.0

 
0.29
%
Winter Ventures Inc. dba Qualitybargainbooks and Qualitybargainmall
 
Nonstore Retailers
 
Term Loan
 
Prime plus 2.75%
 
12/23/2024

 
156.1

 
154.2

 
131.1

 
0.08
%
Carolina Flicks Inc. dba The Howell Theater
 
Motion Picture and Sound Recording Industries
 
Term Loan
 
Prime plus 2.75%
 
12/23/2032

 
163.3

 
162.4

 
149.4

 
0.09
%
Atlantis of Daytona. LLC and Ocean Club Sportswear Inc.
 
Clothing and Clothing Accessories Stores
 
Term Loan
 
Prime plus 2.75%
 
12/23/2039

 
240.0

 
239.3

 
240.0

 
0.14
%
Bowlerama, Inc.
 
Amusement, Gambling, and Recreation Industries
 
Term Loan
 
Prime plus 2.75%
 
12/24/2039

 
1,202.5

 
1,200.7

 
1,200.4

 
0.71
%
Bear Creek Entertainment, LLC dba The Woods at Bear Creek
 
Accommodation
 
Term Loan
 
Prime plus 2.75%
 
12/30/2024

 
106.3

 
104.9

 
103.5

 
0.06
%
Evans and Paul, LLC
 
Merchant Wholesalers, Durable Goods
 
Term Loan
 
Prime plus 2.75%
 
12/30/2024

 
223.8

 
221.0

 
205.7

 
0.12
%
First Prevention and Dialysis Center, LLC
 
Ambulatory Health Care Services
 
Term Loan
 
Prime plus 2.75%
 
12/30/2024

 
238.3

 
120.4

 
118.8

 
0.07
%
Grand Blanc Lanes, Inc. and H, H and H, LLC
 
Amusement, Gambling, and Recreation Industries
 
Term Loan
 
Prime plus 2.75%
 
12/31/2039

 
133.0

 
132.6

 
130.3

 
0.08
%
FHJE Ventures, LLC and Eisenreich II Inc. dba Breakneck Tavern
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
12/31/2039

 
245.5

 
200.8

 
198.0

 
0.12
%
MLM Enterprises, LLC and Demand Printing Solutions Inc.
 
Printing and Related Support Activities
 
Term Loan
 
Prime plus 2.75%
 
11/18/2024

 
70.5

 
69.2

 
62.3

 
0.04
%
DC Real, LLC and DC Enterprises, LTD dba Lakeview True Value
 
Building Material and Garden Equipment and Supplies Dealers
 
Term Loan
 
Prime plus 2.75%
 
11/20/2039

 
119.4

 
113.9

 
110.4

 
0.07
%
Legacy Estate Planning Inc. dba American Casket Enterprises
 
Personal and Laundry Services
 
Term Loan
 
Prime plus 2.75%
 
11/21/2024

 
42.0

 
41.2

 
32.9

 
0.02
%
J&D Resources, LLC dba Aqua Science
 
Specialty Trade Contractors
 
Term Loan
 
Prime plus 2.75%
 
11/21/2024

 
767.9

 
753.8

 
616.4

 
0.36
%
DeRidder Chiropractic, LLC
 
Ambulatory Health Care Services
 
Term Loan
 
Prime plus 2.75%
 
11/25/2024

 
13.2

 
13.0

 
12.3

 
0.01
%
Teamnewman Enterprises, LLC dba Newmans at 988
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
11/25/2039

 
148.8

 
148.1

 
138.1

 
0.08
%
Stormrider Inc. dba Shirley's Stormrider, Inc.
 
Truck Transportation
 
Term Loan
 
Prime plus 2.75%
 
11/25/2024

 
150.0

 
147.2

 
117.4

 
0.07
%
Modern Manhattan, LLC
 
Furniture and Home Furnishings Stores
 
Term Loan
 
Prime plus 2.75%
 
11/25/2024

 
220.0

 
215.9

 
175.1

 
0.10
%
Meridian Hotels, LLC dba Best Western Jonesboro
 
Accommodation
 
Term Loan
 
Prime plus 2.75%
 
11/25/2039

 
228.0

 
228.0

 
228.6

 
0.13
%
Trading Group 3, Inc.
 
Miscellaneous Store Retailers
 
Term Loan
 
Prime plus 2.75%
 
11/26/2024

 
22.5

 
22.1

 
17.6

 
0.01
%

10

Table of Contents

Portfolio Company
 
Industry
 
Type of Investment
 
Interest Rate (2)
 
Maturity
 
Principal
 
Cost
 
Fair Value
 
% of Net Assets
The Red Pill Management Inc. dba UFC Gym Matthews
 
Performing Arts, Spectator Sports, and Related Industries
 
Term Loan
 
Prime plus 2.75%
 
11/26/2024

 
54.3

 
53.8

 
44.6

 
0.03
%
Homegrown For Good, LLC
 
Apparel Manufacturing
 
Term Loan
 
Prime plus 2.75%
 
11/26/2024

 
230.0

 
228.6

 
201.2

 
0.12
%
Kemmer, LLC and Apples Tree Top Liquors, LLC
 
Food and Beverage Stores
 
Term Loan
 
Prime plus 2.75%
 
12/4/2039

 
138.4

 
138.0

 
124.9

 
0.07
%
The Conibear Corporation and Conibear Trucking, LLC
 
Truck Transportation
 
Term Loan
 
Prime plus 2.75%
 
12/5/2024

 
12.0

 
11.9

 
10.4

 
0.01
%
All American Games, LLC and Sportslink - The Game, LLC
 
Performing Arts, Spectator Sports, and Related Industries
 
Term Loan
 
Prime plus 2.75%
 
12/10/2024

 
400.0

 
395.0

 
337.8

 
0.20
%
3 F Management, LLC and ATC Port Charlotte, LLC
 
Amusement, Gambling, and Recreation Industries
 
Term Loan
 
Prime plus 2.75%
 
10/17/2024

 
131.3

 
128.0

 
109.1

 
0.06
%
185 Summerfield Inc. and Valcon Contracting Corp.
 
Construction of Buildings
 
Term Loan
 
Prime plus 2.75%
 
10/24/2039

 
162.3

 
161.3

 
156.7

 
0.09
%
Navdeep B Martins and Busy Bubbles, LLC dba Wishy Washy
 
Personal and Laundry Services
 
Term Loan
 
Prime plus 2.75%
 
10/24/2039

 
89.0

 
88.6

 
80.3

 
0.05
%
Seelan Inc. dba Candleridge Market
 
Gasoline Stations
 
Term Loan
 
Prime plus 2.75%
 
10/27/2039

 
90.5

 
90.0

 
83.8

 
0.05
%
Kantz, LLC and Kantz Auto, LLC dba Kantz's Hometown Auto
 
Motor Vehicle and Parts Dealers
 
Term Loan
 
Prime plus 2.75%
 
10/29/2039

 
68.1

 
67.7

 
64.9

 
0.04
%
Golden Transaction Corporation dba Bleh Sunoco
 
Gasoline Stations
 
Term Loan
 
Prime plus 2.75%
 
10/30/2039

 
156.7

 
155.8

 
152.2

 
0.09
%
Heartland American Properties, LLC and Skaggs RV Outlet, LLC
 
Motor Vehicle and Parts Dealers
 
Term Loan
 
Prime plus 2.75%
 
10/31/2039

 
479.0

 
476.2

 
458.2

 
0.27
%
Frontier Bulk Solutions, LLC
 
Building Material and Garden Equipment and Supplies Dealers
 
Term Loan
 
Prime plus 2.75%
 
10/31/2024

 
1,250.0

 
1,218.9

 
1,025.3

 
0.60
%
M and C Renovations Inc.
 
Construction of Buildings
 
Term Loan
 
Prime plus 2.75%
 
10/31/2024

 
20.3

 
19.8

 
15.9

 
0.01
%
Laura L. Smith dba Lisa Smith Studio
 
Professional, Scientific, and Technical Services
 
Term Loan
 
Prime plus 2.75%
 
11/3/2024

 
15.0

 
14.6

 
11.7

 
0.01
%
Joey O's, LLC and Jennifer Olszewski
 
Specialty Trade Contractors
 
Term Loan
 
Prime plus 2.75%
 
11/7/2024

 
13.1

 
12.7

 
10.1

 
0.01
%
JEJE Realty, LLC and La Familia Inc.
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
11/10/2039

 
205.8

 
204.9

 
191.4

 
0.11
%
Ryan Crick and Pamela J. Crick and Crick Enterprises Inc.
 
Repair and Maintenance
 
Term Loan
 
Prime plus 2.75%
 
9/17/2039

 
145.5

 
144.4

 
144.5

 
0.09
%
Modern Leather Goods Repair Shop Inc.
 
Repair and Maintenance
 
Term Loan
 
Prime plus 2.75%
 
9/17/2024

 
58.8

 
56.5

 
44.3

 
0.03
%
Play and Stay, LLC dba Zoom Room Tinton Falls
 
Personal and Laundry Services
 
Term Loan
 
Prime plus 2.75%
 
9/18/2024

 
42.1

 
41.3

 
32.4

 
0.02
%
Utek Corporation dba Arcade Car Wash
 
Repair and Maintenance
 
Term Loan
 
Prime plus 2.75%
 
9/22/2039

 
405.5

 
403.2

 
398.6

 
0.24
%

11

Table of Contents

Portfolio Company
 
Industry
 
Type of Investment
 
Interest Rate (2)
 
Maturity
 
Principal
 
Cost
 
Fair Value
 
% of Net Assets
Andrene's, LLC dba Andrene's Caribbean Soul Food Carry Out
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
9/23/2024

 
37.8

 
36.8

 
29.0

 
0.02
%
R A Johnson Inc. dba Rick Johnson Auto and Tire
 
Repair and Maintenance
 
Term Loan
 
Prime plus 2.75%
 
9/23/2039

 
301.3

 
299.0

 
299.1

 
0.18
%
North Columbia, LLC and Loop Liquor and Convenience Store, LLC
 
Food and Beverage Stores
 
Term Loan
 
Prime plus 2.75%
 
9/24/2039

 
159.3

 
158.1

 
152.0

 
0.09
%
6 Price Avenue, LLC and Pauley Tree & Lawn Care, Inc.
 
Administrative and Support Services
 
Term Loan
 
Prime plus 2.75%
 
9/24/2039

 
452.5

 
449.2

 
390.4

 
0.23
%
Keys Phase One, LLC dba The Grand Guesthouse
 
Accommodation
 
Term Loan
 
Prime plus 2.75%
 
9/26/2039

 
736.3

 
730.9

 
704.8

 
0.42
%
Auto Shine Carwash Inc. and AKM R. Hossain and Jessica F. Masud
 
Gasoline Stations
 
Term Loan
 
Prime plus 2.75%
 
9/26/2024

 
22.5

 
21.8

 
18.0

 
0.01
%
Gordon E Rogers dba Stonehouse Motor Inn
 
Accommodation
 
Term Loan
 
Prime plus 2.75%
 
9/26/2039

 
57.5

 
57.1

 
57.1

 
0.03
%
Colts V, LLC and Nowatzke Service Center, Inc.
 
Repair and Maintenance
 
Term Loan
 
Prime plus 2.75%
 
9/26/2039

 
601.8

 
597.3

 
572.8

 
0.34
%
Orange County Insurance Brokerage Inc. dba Beaty Insurance Agency
 
Insurance Carriers and Related Activities
 
Term Loan
 
Prime plus 2.75%
 
9/29/2039

 
325.1

 
323.7

 
323.8

 
0.19
%
The Woods at Bear Creek, LLC and Bear Creek Entertainment, LLC
 
Accommodation
 
Term Loan
 
Prime plus 2.75%
 
9/29/2039

 
513.3

 
510.3

 
510.4

 
0.30
%
Roccos, LLC and Sullo Pantalone Inc. dba Rocco's
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
9/30/2039

 
255.8

 
253.9

 
232.5

 
0.14
%
Keller Holdings, LLC and David H Keller III and Carie C Keller
 
Scenic and Sightseeing Transportation
 
Term Loan
 
Prime plus 2.75%
 
9/30/2039

 
100.0

 
99.3

 
97.9

 
0.06
%
Route 130 SCPI Holdings LLC, (EPC) Route 130 SCPI Operations, LLC (OC)
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
9/30/2039

 
538.8

 
538.8

 
491.1

 
0.29
%
Sumad, LLC dba BrightStar Care of Encinitas
 
Administrative and Support Services
 
Term Loan
 
Prime plus 2.75%
 
10/2/2024

 
92.5

 
90.8

 
88.6

 
0.05
%
Michael Rey Jr. and Lynn J. Williams (EPC) and GIG Petcare
 
Personal and Laundry Services
 
Term Loan
 
Prime plus 2.75%
 
10/3/2039

 
126.9

 
125.9

 
121.4

 
0.07
%
Smith Spinal Care Center P.C. and James C. Smith
 
Ambulatory Health Care Services
 
Term Loan
 
Prime plus 2.75%
 
10/8/2039

 
60.0

 
59.7

 
56.7

 
0.03
%
Doctors Express Management of Central Texas, LLC
 
Ambulatory Health Care Services
 
Term Loan
 
Prime plus 2.75%
 
10/8/2024

 
105.0

 
90.6

 
83.2

 
0.05
%
Boilermaker Industries, LLC dba PostNet
 
Administrative and Support Services
 
Term Loan
 
Prime plus 2.75%
 
10/9/2024

 
18.8

 
18.5

 
16.5

 
0.01
%
DNT Storage and Properties, LLC
 
Real Estate
 
Term Loan
 
Prime plus 2.75%
 
10/10/2039

 
101.8

 
101.2

 
98.6

 
0.06
%
Capitol Waste and Recycling Services, LLC
 
Waste Management and Remediation Services
 
Term Loan
 
Prime plus 2.75%
 
10/10/2024

 
257.8

 
251.3

 
214.5

 
0.13
%
Return to Excellence, Inc. dba The Waynesville Inn Golf & Spa
 
Amusement, Gambling, and Recreation Industries
 
Term Loan
 
Prime plus 2.75%
 
10/10/2039

 
1,250.0

 
1,249.0

 
1,249.6

 
0.74
%

12

Table of Contents

Portfolio Company
 
Industry
 
Type of Investment
 
Interest Rate (2)
 
Maturity
 
Principal
 
Cost
 
Fair Value
 
% of Net Assets
Sound Manufacturing Inc.
 
Fabricated Metal Product Manufacturing
 
Term Loan
 
Prime plus 2.75%
 
10/10/2024

 
187.5

 
183.1

 
152.7

 
0.09
%
One Hour Jewelry Repair Inc.
 
Repair and Maintenance
 
Term Loan
 
Prime plus 2.75%
 
10/14/2024

 
20.6

 
20.0

 
15.7

 
0.01
%
Grey Light Realty, LLC (EPC) NH Precision Metal Fabricators Inc. (OC)
 
Fabricated Metal Product Manufacturing
 
Term Loan
 
Prime plus 2.75%
 
8/21/2039

 
1,226.0

 
1,215.2

 
1,191.4

 
0.70
%
Atlas Auto Body Inc. dba Atlas Auto Sales
 
Repair and Maintenance
 
Term Loan
 
Prime plus 2.75%
 
8/22/2039

 
51.6

 
51.1

 
47.4

 
0.03
%
Qycell Corporation
 
Plastics and Rubber Products Manufacturing
 
Term Loan
 
Prime plus 2.75%
 
8/26/2024

 
121.0

 
116.6

 
101.0

 
0.06
%
Orange County Cleaning Inc.
 
Administrative and Support Services
 
Term Loan
 
Prime plus 2.75%
 
8/27/2024

 
41.3

 
39.7

 
31.2

 
0.02
%
Lamjam, LLC (EPC) Goldsmith Lambros Inc. (OC)
 
Clothing and Clothing Accessories Stores
 
Term Loan
 
Prime plus 2.75%
 
8/27/2024

 
133.8

 
129.0

 
126.8

 
0.07
%
Delta Aggrigate, LLC
 
Mining (except Oil and Gas)
 
Term Loan
 
Prime plus 2.75%
 
8/28/2039

 
911.3

 
906.1

 
906.3

 
0.53
%
Alberti and Cardoni, LLC dba Menchie's
 
Health and Personal Care Stores
 
Term Loan
 
Prime plus 2.75%
 
8/29/2024

 
77.3

 
75.8

 
62.4

 
0.04
%
Feel The World Inc. dba Xero Shoes and Invisible Shoes
 
Leather and Allied Product Manufacturing
 
Term Loan
 
Prime plus 2.75%
 
9/5/2024

 
51.9

 
50.3

 
40.9

 
0.02
%
B&P Diners, LLC dba Engine House Restaurant
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
9/10/2024

 
80.0

 
77.5

 
60.8

 
0.04
%
Indy East Smiles Youth Dentistry, LLC dba Prime Smile East
 
Ambulatory Health Care Services
 
Term Loan
 
Prime plus 2.75%
 
9/11/2024

 
630.2

 
610.6

 
482.8

 
0.28
%
KW Zion, LLC and Key West Gallery Inc.
 
Miscellaneous Store Retailers
 
Term Loan
 
Prime plus 2.75%
 
9/12/2039

 
1,250.0

 
1,240.8

 
1,195.4

 
0.70
%
RDT Enterprises, LLC
 
Specialty Trade Contractors
 
Term Loan
 
Prime plus 2.75%
 
9/15/2027

 
162.8

 
159.2

 
150.0

 
0.09
%
Tavern Properties, LLC and Wildwood Tavern, LLC
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
9/15/2039

 
425.0

 
425.0

 
407.1

 
0.24
%
Animal Intrusion Prevention Systems Holding Company, LLC
 
Administrative and Support Services
 
Term Loan
 
Prime plus 2.75%
 
9/15/2024

 
272.5

 
264.0

 
223.7

 
0.13
%
Miss Cranston Diner II, LLC and Miss Cranston II Realty, LLC
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
7/17/2039

 
109.5

 
97.3

 
93.1

 
0.05
%
Honeyspot Investors, LLP and Pace Motor Lines Inc.
 
Truck Transportation
 
Term Loan
 
Prime plus 2.75%
 
7/24/2039

 
150.0

 
148.5

 
146.9

 
0.09
%
L&S Insurance & Financial Services Inc.
 
Insurance Carriers and Related Activities
 
Term Loan
 
Prime plus 2.75%
 
7/25/2024

 
22.5

 
21.5

 
17.2

 
0.01
%
575 Columbus Avenue Holding Company, LLC and LA-ZE, LLC
 
Food Services and Drinking Places
 
Term Loan
 
Prime plus 2.75%
 
7/30/2039