UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

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

 

For the quarterly period ended March 31, 2019

 

OR

 

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

 

Commission file number: 814-00866

 

MONROE CAPITAL CORPORATION

(Exact Name of Registrant as Specified in its Charter)

 

Maryland 27-4895840
(State or Other Jurisdiction of
Incorporation or Organization)
(I.R.S. Employer
Identification No.)
   
311 South Wacker Drive, Suite 6400
Chicago, Illinois
60606
(Address of Principal Executive Office) (Zip Code)

 

(312) 258-8300

(Registrant’s Telephone Number, Including Area Code) 

 

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

 

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

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ¨ Accelerated filer x
       
Non-accelerated filer ¨ Smaller reporting company ¨
       
Emerging growth company ¨    

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

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

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class   Trading Symbol(s)   Name of Each Exchange on Which Registered
Common Stock, par value $0.001 per share
5.75% Notes due 2023
  MRCC
MRCCL
  The Nasdaq Global Select Market
The Nasdaq Global Select Market

 

As of May 6, 2019, the registrant had 20,444,564 shares of common stock, $0.001 par value, outstanding.

 

 

 

 

 

 

TABLE OF CONTENTS

 

    Page
PART I. FINANCIAL INFORMATION 3
     
Item 1. Consolidated Financial Statements 3
     
  Consolidated Statements of Assets and Liabilities as of March 31, 2019 (unaudited) and December 31, 2018 3
     
  Consolidated Statements of Operations for the three months ended March 31, 2019 (unaudited) and 2018 (unaudited) 4
     
  Consolidated Statements of Changes in Net Assets for the three months ended March 31, 2019 (unaudited) and 2018 (unaudited) 5
     
  Consolidated Statements of Cash Flows for the three months ended March 31, 2019 (unaudited) and 2018 (unaudited) 6
     
  Consolidated Schedules of Investments as of March 31, 2019 (unaudited) and December 31, 2018 7
     
  Notes to Consolidated Financial Statements (unaudited) 26
     
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 53
     
Item 3. Quantitative and Qualitative Disclosures About Market Risk 71
     
Item 4. Controls and Procedures 72
     
PART II. OTHER INFORMATION 73
     
Item 1. Legal Proceedings 73
     
Item 1A. Risk Factors 73
     
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 73
     
Item 3. Defaults Upon Senior Securities 73
     
Item 4. Mine Safety Disclosures 73
     
Item 5. Other Information 73
     
Item 6. Exhibits 74
     
Signatures   75

 

2

 

 

Part I. Financial Information

Item 1. Consolidated Financial Statements

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

(in thousands, except per share data)

 

   March 31, 2019  December 31, 2018
   (unaudited)   
ASSETS          
Investments, at fair value:          
Non-controlled/non-affiliate company investments  $505,957   $468,720 
Non-controlled affiliate company investments   58,956    57,267 
Controlled affiliate company investments   32,032    27,634 
Total investments, at fair value (amortized cost of: $606,591 and $564,124, respectively)   596,945    553,621 
Cash   4,690    3,744 
Restricted cash   17,315    13,982 
Unrealized gain on foreign currency forward contracts       16 
Interest receivable   8,976    7,774 
Other assets   588    692 
Total assets   628,514    579,829 
           
LIABILITIES          
Debt:          
Revolving credit facility   146,342    136,026 
2023 Notes   109,000    69,000 
SBA debentures payable   115,000    115,000 
Total debt   370,342    320,026 
Less: Unamortized deferred financing costs   (9,265)   (6,262)
Total debt, less unamortized deferred financing costs   361,077    313,764 
Interest payable   1,932    2,550 
Unrealized loss on foreign currency forward contracts   49     
Management fees payable   2,521    2,318 
Incentive fees payable   1,319     
Accounts payable and accrued expenses   2,529    2,430 
Directors' fees payable   35     
Total liabilities   369,462    321,062 
Net assets  $259,052   $258,767 
           
Commitments and contingencies (See Note 11)          
           
ANALYSIS OF NET ASSETS          
Common stock, $0.001 par value, 100,000 shares authorized, 20,445 and 20,445 shares issued and outstanding, respectively  $20   $20 
Capital in excess of par value   288,911    288,911 
Accumulated undistributed (overdistributed) earnings   (29,879)   (30,164)
Total net assets  $259,052   $258,767 
           
Net asset value per share  $12.67   $12.66 

 

See Notes to Consolidated Financial Statements.

 

3

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

 

(in thousands, except per share data)

 

   Three months ended March 31,
   2019  2018
Investment income:          
Non-controlled/non-affiliate company investments:          
Interest income  $12,830   $11,826 
Payment-in-kind interest income   98    137 
Dividend income   13    260 
Fee income   569    724 
Total investment income from non-controlled/non-affiliate company investments   13,510    12,947 
Non-controlled affiliate company investments:          
Interest income   923    1,636 
Payment-in-kind interest income   956    192 
Total investment income from non-controlled affiliate company investments   1,879    1,828 
Controlled affiliate company investments:          
Dividend income   770    175 
Total investment income from controlled affiliate company investments   770    175 
Total investment income   16,159    14,950 
           
Operating expenses:          
Interest and other debt financing expenses   4,354    2,706 
Base management fees   2,521    2,163 
Incentive fees   1,600    761 
Professional fees   289    307 
Administrative service fees   347    324 
General and administrative expenses   227    176 
Excise taxes   (7)   11 
Directors' fees   35    37 
Expenses before incentive fee waiver   9,366    6,485 
Incentive fee waiver   (281)    
Total expenses, net of incentive fee waiver   9,085    6,485 
Net investment income   7,074    8,465 
           
Net gain (loss):          
Net realized gain (loss):          
Foreign currency forward contracts   (8)    
Foreign currency and other transactions   (1)   12 
Net realized gain (loss)   (9)   12 
           
Net change in unrealized gain (loss):          
Non-controlled/non-affiliate company investments   2,288    (165)
Non-controlled affiliate company investments   (1,754)   (6,923)
Controlled affiliate company investments   323    443 
Foreign currency forward contracts   (65)    
Foreign currency and other transactions   (416)   (442)
Net change in unrealized gain (loss)   376    (7,087)
           
Net gain (loss)   367    (7,075)
           
Net increase (decrease) in net assets resulting from operations  $7,441   $1,390 
           
Per common share data:          
Net investment income per share - basic and diluted  $0.35   $0.42 
Net increase (decrease) in net assets resulting from operations per share - basic and diluted  $0.36   $0.07 
Weighted average common shares outstanding - basic and diluted   20,445    20,240 

 

See Notes to Consolidated Financial Statements.

 

4

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS

(unaudited)

 

(in thousands)

 

           Accumulated     
   Common Stock   Capital in   undistributed     
   Number of   Par   excess of par   (overdistributed)   Total 
   shares   value   value   earnings   net assets 
Balances at December 31, 2017   20,240   $20   $286,141   $(7,462)  $278,699 
Net investment income               8,465    8,465 
Net realized gain (loss)               12    12 
Net change in unrealized gain (loss)               (7,087)   (7,087)
Distributions to stockholders               (7,084)   (7,084)
Balances at March 31, 2018   20,240   $20   $286,141   $(13,156)  $273,005 
                          
Balances at December 31, 2018   20,445   $20   $288,911   $(30,164)  $258,767 
Net investment income               7,074    7,074 
Net realized gain (loss)               (9)   (9)
Net change in unrealized gain (loss)               376    376 
Distributions to stockholders               (7,156)   (7,156)
Balances at March 31, 2019   20,445   $20   $288,911   $(29,879)  $259,052 

 

See Notes to Consolidated Financial Statements.

 

5

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

 

(in thousands)

 

   Three months ended March 31,
   2019  2018
       
Cash flows from operating activities:          
Net increase (decrease) in net assets resulting from operations  $7,441   $1,390 
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities:          
Net change in unrealized (gain) loss on investments   (857)   6,645 
Net change in unrealized (gain) loss on foreign currency forward contracts   65     
Net change in unrealized (gain) loss on foreign currency and other transactions   416    442 
Net realized (gain) loss on foreign currency forward contracts   8     
Net realized (gain) loss on foreign currency and other transactions   1    (12)
Payment-in-kind interest income   (1,054)   (329)
Payment-in-kind dividend income       (260)
Net accretion of discounts and amortization of premiums   (426)   (1,032)
Proceeds from principal payments, sales of investments and settlement of forward contracts   29,127    25,559 
Purchases of investments   (70,122)   (32,479)
Amortization of deferred financing costs   433    281 
Changes in operating assets and liabilities:          
Interest receivable   (1,202)   (421)
Other assets   104    33 
Interest payable   (618)   (740)
Management fees payable   203    99 
Incentive fees payable   1,319    (396)
Accounts payable and accrued expenses   99    (8)
Directors' fees payable   35    37 
Net cash provided by (used in) operating activities   (35,028)   (1,191)
           
Cash flows from financing activities:          
Borrowings on revolving credit facility   210,850    24,800 
Repayments of revolving credit facility   (200,950)   (16,750)
Proceeds from 2023 Notes   40,000     
SBA debentures borrowings       3,280 
Payments of deferred financing costs   (3,436)   (79)
Stockholder distributions paid, net of stock issued under the dividend reinvestment plan of $0 and $0, respectively   (7,156)   (7,084)
Net cash provided by (used in) financing activities   39,308    4,167 
           
Net increase (decrease) in Cash and Restricted Cash   4,280    2,976 
Effect of foreign currency exchange rates   (1)   12 
Cash and Restricted Cash, beginning of period (1)   17,726    7,199 
Cash and Restricted Cash, end of period (2)  $22,005   $10,187 
           
Supplemental disclosure of cash flow information:          
Cash interest paid during the period  $4,845   $3,145 
Cash paid for excise taxes during the period  $130   $91 

 

 

(1) Represents cash and restricted cash of $3,744 and $13,982, respectively, from the consolidated statement of assets and liabilities as of December 31, 2018. Represents cash and restricted cash of $4,332 and $2,867, respectively, from the consolidated statement of assets and liabilities as of December 31, 2017.
   
(2) Represents cash and restricted cash of $4,690 and $17,315, respectively, from the consolidated statement of assets and liabilities as of March 31, 2019. Represents cash and restricted cash of $3,070 and $7,117, respectively, from the consolidated statement of assets and liabilities as of March 31, 2018.

 

See Notes to Consolidated Financial Statements.

 

6

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED SCHEDULE OF INVESTMENTS

(unaudited)

March 31, 2019

(in thousands, except for shares and units)

 

Portfolio Company (a)  Spread Above
Index (b)
  Interest
Rate
    Acquisition
Date (c)
  Maturity    Principal  Amortized
Cost
  Fair
Value (d)
  % of
Net Assets (e)
Non-Controlled/Non-Affiliate Company Investments                                    
Senior Secured Loans                                    
Automotive                                    
Hastings Manufacturing Company  L+8.25%  10.75%    4/24/2018  4/24/2023     2,925   $2,875   $2,798    1.1%
Hastings Manufacturing Company (Delayed Draw) (f) (g)  L+8.25%  10.75%    4/24/2018  4/24/2023     899            0.0%
Magneto & Diesel Acquisition, Inc.  L+5.50%  8.00%    12/18/2018  12/18/2023     4,987    4,904    4,965    1.9%
Magneto & Diesel Acquisition, Inc. (Revolver) (f)  L+5.50%  8.00%    12/18/2018  12/18/2023     500    83    83    0.0%
                    9,311    7,862    7,846    3.0%
Banking, Finance, Insurance & Real Estate                                    
Echelon Funding I, LLC (Delayed Draw) (f) (g) (h)  L+7.50%  9.99%    2/24/2017  2/24/2022     15,750    15,358    15,374    5.9%
HFZ Capital Group, LLC (h)  L+10.17%  12.80% Cash/ 0.17% PIK(i)    10/20/2017  10/21/2019     18,000    17,873    18,000    6.9%
HFZ Member RB Portfolio LLC (Delayed Draw) (f) (g) (h)  L+12.00%  14.62%   10/30/2018  10/29/2021     9,000    4,473    4,469    1.7%
Liftforward SPV II, LLC (f) (h)  L+10.75%  13.25%    11/10/2016  11/10/2020     10,000    4,070    4,105    1.6%
PKS Holdings, LLC (h)  L+10.00%  12.49%    11/30/2017  11/30/2022     1,733    1,587    1,712    0.8%
PKS Holdings, LLC (Revolver) (f) (h)  L+10.00%  12.49%    11/30/2017  11/30/2022     80            0.0%
                   54,563    43,361    43,660    16.9%
Beverage, Food & Tobacco                                    
California Pizza Kitchen, Inc.  L+6.00%  8.50%    8/19/2016  8/23/2022     6,825    6,778    6,612    2.6%
Toojay's Management LLC  L+5.50%  8.00%    10/26/2018  10/26/2022     3,491    3,428    3,489    1.3%
Toojay's Management LLC (Delayed Draw) (f) (g)  L+5.50%  8.00%    10/26/2018  10/26/2022     477    239    239    0.1%
Toojay's Management LLC (Revolver) (f)  L+5.50%  8.00%    10/26/2018  10/26/2022     159    80    80    0.0%
                    10,952    10,525    10,420    4.0%
Chemicals, Plastics & Rubber                                    
Midwest Composite Technologies, LLC  L+6.25%  8.75%    8/31/2018  8/31/2023     896    879    913    0.4%
Midwest Composite Technologies, LLC (Delayed Draw) (f) (g)  L+6.25%  8.75%    8/31/2018  8/31/2023     600            0.0%
Midwest Composite Technologies, LLC (Revolver) (f)  L+6.25%  8.75%    8/31/2018  8/31/2023     90            0.0%
Valudor Products LLC  L+7.50%  10.00%    6/18/2018  6/19/2023     1,594    1,566    1,589    0.6%
Valudor Products LLC (j)  L+7.50%  10.00%    6/18/2018  6/19/2023     211    205    210    0.1%
Valudor Products LLC (Revolver) (f)  L+9.50%  12.00%    6/18/2018  6/19/2023     818    622    622    0.2%
                  4,209    3,272    3,334    1.3%
Construction & Building                                    
Cali Bamboo, LLC  L+6.25%  8.75%    7/10/2015  7/10/2020     7,916    7,843    7,916    3.1%
Cali Bamboo, LLC (Revolver) (f)  L+6.25%  8.75%    7/10/2015  7/10/2020     2,165    866    866    0.3%
Construction Supply Acquisition, LLC  L+6.00%  8.50%    11/27/2018  6/30/2023     4,650    4,628    4,638    1.8%
Inland Pipe Rehabilitation LLC  L+5.50%  8.10%    12/27/2018  12/26/2024     12,469    12,227    12,431    4.8%
Inland Pipe Rehabilitation LLC (Revolver) (f)  L+5.50%  8.00%    12/27/2018  12/26/2024     4,118    2,789    2,789    1.1%
                    31,318    28,353    28,640    11.1%
Consumer Goods: Durable                                    
Nova Wildcat Amerock, LLC  L+5.75%  8.25%    10/12/2018  10/12/2023     9,476    9,301    9,419    3.6%
Nova Wildcat Amerock, LLC (Revolver) (f)  L+5.75%  8.25%    10/12/2018  10/12/2023     931    106    106    0.0%
Parterre Flooring & Surface Systems, LLC (k)  L+7.25%  9.75%    8/22/2017  8/22/2022     11,100    10,938    10,789    4.2%
Parterre Flooring & Surface Systems, LLC (Revolver) (f)  L+7.25%  9.75%    8/22/2017  8/22/2022     2,400    696    675    0.3%
                    23,907    21,041    20,989    8.1%
Consumer Goods: Non-Durable                                    
Quirch Foods Holdings, LLC  L+6.00%  8.49%    2/14/2019  12/19/2025     1,995    1,975    2,005    0.8%
                    1,995    1,975    2,005    0.8%
Energy: Oil & Gas                                    
BJ Services, LLC  L+7.00%  9.65%    1/28/2019  1/3/2023     4,500    4,458    4,498    1.7%
Landpoint, LLC  L+10.50%  13.00%    12/17/2013  12/20/2019     2,256    2,254    2,251    0.9%
Landpoint, LLC (Revolver) (f)  L+10.50%  13.00%    12/17/2013  12/20/2019     313            0.0%
                    7,069    6,712    6,749    2.6%

 

7

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED SCHEDULE OF INVESTMENTS – (continued)

(unaudited)

March 31, 2019

(in thousands, except for shares and units)

 

Portfolio Company (a)  Spread Above
Index (b)
  Interest
Rate
    Acquisition
Date (c)
  Maturity    Principal  Amortized
Cost
  Fair
Value (d)
  % of
Net Assets (e)
Environmental Industries                                    
StormTrap, LLC  L+5.50%  8.00%    12/10/2018  12/8/2023     7,980   $7,847   $7,956    3.1%
StormTrap, LLC (Revolver) (f)  L+5.50%  8.00%    12/10/2018  12/8/2023     432    216    216    0.1%
Synergy Environmental Corporation (k)  L+6.50%  9.00%    4/29/2016  4/29/2021     2,912    2,878    2,902    1.1%
Synergy Environmental Corporation (k)  L+6.50%  9.00%    4/29/2016  4/29/2021     487    481    485    0.1%
Synergy Environmental Corporation (Delayed Draw) (f) (g)  L+6.50%  9.00%    4/29/2016  4/29/2021     1,315    832    829    0.3%
Synergy Environmental Corporation (Revolver) (f)  L+6.50%  9.00%    4/29/2016  4/29/2021     671    404    402    0.2%
                    13,797    12,658    12,790    4.9%
Healthcare & Pharmaceuticals                                    
American Optics Holdco, Inc. (h) (l)  L+7.00%  9.50%    9/13/2017  9/13/2022     4,293    4,228    4,265    1.6%
American Optics Holdco, Inc. (h) (l)  L+7.00%  9.50%    9/13/2017  9/13/2022     1,669    1,640    1,658    0.6%
American Optics Holdco, Inc. (Revolver) (f) (h) (l)  L+7.00%  9.50%    9/13/2017  9/13/2022     440            0.0%
American Optics Holdco, Inc. (Revolver) (f) (h) (l)  L+7.00%  9.50%    9/13/2017  9/13/2022     440            0.0%
Familia Dental Group Holdings, LLC (k)  L+8.00%  10.50%    4/8/2016  4/8/2021     5,019    4,981    4,906    1.9%
Familia Dental Group Holdings, LLC  L+8.00%  10.50%    4/8/2016  4/8/2021     483    483    472    0.2%
Familia Dental Group Holdings, LLC (Revolver) (f)  L+8.00%  10.50%    4/8/2016  4/8/2021     573    286    286    0.1%
Rockdale Blackhawk, LLC (DIP Facility)  n/a  15.10%    8/30/2018  n/a (m)   198    198    198    0.1%
Rockdale Blackhawk, LLC (DIP Facility)  n/a  15.10%    8/6/2018  n/a (m)   8,877    8,877    8,877    3.4%
Rockdale Blackhawk, LLC  L+13.00%  15.50%(n)   3/31/2015  3/31/2020     10,923    10,465    8,692    3.4%
                    32,915    31,158    29,354    11.3%
High Tech Industries                                    
Host Analytics, Inc.  L+6.00%  8.49%    12/28/2018  12/28/2023     9,500    9,318    9,500    3.7%
Host Analytics, Inc. (Revolver) (f)  L+6.00%  8.49%    12/28/2018  12/28/2023     442            0.0%
Mindbody, Inc.  L+7.00%  9.48%    2/15/2019  2/14/2025     6,333    6,212    6,346    2.4%
Mindbody, Inc. (Revolver) (f)  L+7.00%  9.48%    2/15/2019  2/14/2025     667            0.0%
Newforma, Inc. (k)  L+5.50%  8.10%    6/30/2017  6/30/2022     14,775    14,622    14,775    5.7%
Newforma, Inc. (Revolver) (f)  L+5.50%  8.10%    6/30/2017  6/30/2022     1,250            0.0%
Prototek Sheetmetal Fabrication, LLC  L+7.00%  9.50%    12/11/2017  12/12/2022     3,456    3,402    3,437    1.3%
Prototek Sheetmetal Fabrication, LLC (Delayed Draw) (f) (g)  L+7.00%  9.50%    12/11/2017  12/12/2022     2,327    811    806    0.3%
Prototek Sheetmetal Fabrication, LLC (Revolver) (f)  L+7.00%  9.50%    12/11/2017  12/12/2022     233            0.0%
RPL Bidco Limited (h) (l) (o)  L+7.50%  8.36%    11/9/2017  11/9/2023     14,056    14,107    14,196    5.5%
RPL Bidco Limited (Delayed Draw) (f) (g) (h) (l) (o)  L+7.50%  8.36%    5/22/2018  11/9/2023     2,086            0.0%
RPL Bidco Limited (Revolver) (f) (h) (l) (o)  L+7.50%  8.36%    11/9/2017  11/9/2023     521            0.0%
WillowTree, LLC  L+5.50%  8.00%    10/9/2018  10/9/2023     7,960    7,832    7,956    3.1%
WillowTree, LLC (Revolver) (f)  L+5.50%  8.00%    10/9/2018  10/9/2023     1,000    620    620    0.2%
                    64,606    56,924    57,636    22.2%
Hotels, Gaming & Leisure                                    
TRG, LLC  L+12.94%  9.99% Cash/ 5.44% PIK (p)  12/23/2014  3/31/2021     17,080    17,027    18,429    7.0%
TRG, LLC (CapEx)  L+9.50%  9.99% Cash/ 2.00% PIK    9/1/2015  3/31/2021     1,365    1,362    1,473    0.6%
TRG, LLC (Revolver) (f)  L+9.50%  11.99%    12/23/2014  3/31/2021     262    131    141    0.1%
                    18,707    18,520    20,043    7.7%
Media: Advertising, Printing & Publishing                                    
AdTheorent, Inc.  L+8.50%  10.99%    12/22/2016  12/22/2021     4,029    3,981    4,035    1.6%
Destination Media, Inc. (k)  L+5.50%  8.00%    4/7/2017  4/7/2022     5,024    4,976    5,075    2.0%
Destination Media, Inc. (Revolver) (f)  L+5.50%  8.00%    4/7/2017  4/7/2022     542            0.0%
MC Sign Lessor Corp.  L+7.00%  9.49%    12/22/2017  12/22/2022     9,159    9,014    9,250    3.5%
MC Sign Lessor Corp.  L+7.00%  9.49%    12/22/2017  12/22/2022     2,083    2,083    2,104    0.8%
MC Sign Lessor Corp. (Revolver) (f)  L+7.00%  9.49%    12/22/2017  12/22/2022     625            0.0%
                    21,462    20,054    20,464    7.9%
Media: Diversified & Production                                    
Attom Intermediate Holdco, LLC  L+5.75%  8.25%    1/4/2019  1/4/2024     1,995    1,957    1,997    0.8%
Attom Intermediate Holdco, LLC (Revolver) (f)  L+5.75%  8.25%    1/4/2019  1/4/2024     320            0.0%
Crownpeak Technology, Inc.  L+6.25%  8.74%    2/28/2019  2/28/2024     4,000    3,923    4,010    1.5%
Crownpeak Technology, Inc. (Delayed Draw) (f) (g)  L+6.25%  8.74%    2/28/2019  2/28/2024     333            0.0%
Crownpeak Technology, Inc. (Revolver) (f)  L+6.25%  8.74%    2/28/2019  2/28/2024     167            0.0%
                    6,815    5,880    6,007    2.3%
Retail                                    
Bluestem Brands, Inc.  L+7.50%  10.00%    6/26/2015  11/6/2020     2,396    2,387    1,770    0.7%
Forman Mills, Inc. (k)  L+9.50%  10.00% Cash/ 2.00% PIK    10/4/2016  10/4/2021     8,309    8,216    8,068    3.1%
LuLu's Fashion Lounge, LLC  L+7.00%  9.50%    8/21/2017  8/29/2022     4,437    4,340    4,433    1.7%
The Worth Collection, Ltd. (k)  L+8.50%  11.00%    9/29/2016  9/29/2021     10,588    10,469    8,682    3.4%
Yandy Holding, LLC  L+11.00%  13.50%    9/30/2014  9/30/2019     3,643    3,636    3,632    1.4%
Yandy Holding, LLC (Revolver) (f)  L+11.00%  13.50%    9/30/2014  9/30/2019     907            0.0%
                    30,280    29,048    26,585    10.3%

 

8

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED SCHEDULE OF INVESTMENTS – (continued)

(unaudited)

March 31, 2019

(in thousands, except for shares and units)

 

Portfolio Company (a)  Spread Above
Index (b)
  Interest
Rate
   Acquisition
Date (c)
  Maturity    Principal   Amortized
Cost
   Fair
Value (d)
   % of
Net Assets (e)
 
Services: Business                                    
APCO Worldwide, Inc.  L+8.00%  10.50%    6/30/2017  6/30/2022     4,812    $4,745    $4,731    1.8%
Atlas Sign Industries of FLA, LLC (k)  L+11.50%  13.00% Cash/ 1.00% PIK    5/14/2018  5/15/2023     3,500    3,305    3,334    1.3%
Burroughs, Inc. (k)  L+7.50%  9.99%    12/22/2017  12/22/2022     5,850    5,782    5,718    2.2%
Burroughs, Inc. (Revolver) (f)  L+7.50%  9.99%    12/22/2017  12/22/2022     1,215    1,125    1,125    0.4%
Certify, Inc.  L+6.00%  8.50%    2/28/2019  2/28/2024     9,000    8,867    8,973    3.5%
Certify, Inc. (Delayed Draw) (f) (g)  L+6.00%  8.50%    2/28/2019  2/28/2024     1,227            0.0%
Certify, Inc. (Revolver) (f)  L+6.00%  8.50%    2/28/2019  2/28/2024     409            0.0%
First Call Resolution, LLC (k)  L+7.00%  9.49%    9/22/2017  9/22/2022     4,085    4,032    4,166    1.6%
First Call Resolution, LLC  L+7.00%  9.49%    9/28/2018  9/22/2022     9,900    9,756    10,098    4.0%
HaystackID LLC  L+6.50%  9.00%    1/14/2019  1/12/2024     4,988    4,893    4,997    1.9%
HaystackID LLC (Revolver) (f)  L+6.50%  9.00%    1/14/2019  1/12/2024     403    161    161    0.1%
IT Global Holding LLC  L+7.00%  9.50%    11/15/2018  11/10/2023     10,434    10,238    10,419    4.0%
IT Global Holding LLC (Revolver) (f)  L+7.00%  9.50%    11/15/2018  11/10/2023     875    263    263    0.1%
Madison Logic, Inc. (k)  L+8.00%  10.50%    11/30/2016  11/30/2021     9,868    9,750    9,868    3.8%
Madison Logic, Inc. (Revolver) (f)  L+8.00%  10.50%    11/30/2016  11/30/2021     988            0.0%
RedZone Robotics, Inc.  L+7.75%  9.25% Cash/ 1.00% PIK    6/1/2018  6/5/2023     756    743    688    0.3%
RedZone Robotics, Inc. (Revolver) (f)  L+7.75%  9.25% Cash/ 1.00% PIK    6/1/2018  6/5/2023     158            0.0%
Security Services Acquisition (k)  L+6.00%  8.58%    2/15/2019  2/15/2024     3,500    3,433    3,497    1.3%
Security Services Acquisition (Delayed Draw) (f) (g) (k)  L+6.00%  8.58%    2/15/2019  2/15/2024     2,500            0.0%
Security Services Acquisition (Delayed Draw) (f) (g) (k)  L+6.00%  8.58%    2/15/2019  2/15/2024     2,188            0.0%
Security Services Acquisition (Revolver) (f)  L+6.00%  8.58%    2/15/2019  2/15/2024     1,042            0.0%
TRP Construction Group, LLC (k)  L+7.00%  9.50%    10/5/2017  10/5/2022     7,911    7,793    7,888    3.0%
TRP Construction Group, LLC (Delayed Draw) (f) (g)  L+7.00%  9.50%    9/5/2018  10/5/2022     7,000    6,741    6,721    2.7%
TRP Construction Group, LLC (Revolver) (f)  L+7.00%  9.50%    10/5/2017  10/5/2022     2,133            0.0%
VPS Holdings, LLC  L+7.00%  9.50%    10/5/2018  10/4/2024     4,969    4,874    4,979    1.9%
VPS Holdings, LLC  L+7.00%  9.50%    10/5/2018  10/4/2024     4,000    4,000    4,008    1.5%
VPS Holdings, LLC (Revolver) (f)  L+7.00%  9.50%    10/5/2018  10/4/2024     1,000    100    100    0.0%
                    104,711    90,601    91,734    35.4%
Services: Consumer                                    
Mammoth Holdings, LLC  L+6.00%  8.80%    10/16/2018  10/16/2023     1,995    1,958    1,992    0.8%
Mammoth Holdings, LLC (Delayed Draw) (f) (g)  L+6.00%  8.80%    10/16/2018  10/16/2023     4,167            0.0%
Mammoth Holdings, LLC (Revolver) (f)  L+6.00%  8.80%    10/16/2018  10/16/2023     500            0.0%
PeopleConnect Intermediate, LLC  L+6.50%  9.30%    7/1/2015  7/1/2020     4,272    4,245    4,255    1.6%
PeopleConnect Intermediate, LLC  L+12.50%  15.30%    7/1/2015  7/1/2020     4,636    4,603    4,610    1.8%
PeopleConnect Intermediate, LLC (Revolver) (f)  L+9.50%  12.30%    7/1/2015  7/1/2020     236    118    118    0.0%
                    15,806    10,924    10,975    4.2%
Wholesale                                    
Mid-West Wholesale Hardware Co. (k)  L+8.00%  10.50%    2/9/2017  2/9/2022     16,361    16,148    16,279    6.3%
Mid-West Wholesale Hardware Co. (Revolver) (f)  L+8.00%  10.50%    2/9/2017  2/9/2022     5,491    3,295    3,278    1.3%
Nearly Natural, Inc. (k)  L+7.00%  9.60%    12/15/2017  12/15/2022     6,913    6,806    6,843    2.6%
Nearly Natural, Inc. (Revolver) (f)  L+7.00%  9.60%    12/15/2017  12/15/2022     1,522    761    761    0.3%
                    30,287    27,010    27,161    10.5%
  Total Non-Controlled/Non-Affiliate Senior Secured Loans                   482,710    425,878    426,392    164.5%
                                     
  Unitranche Secured Loans (q)                                    
Chemicals, Plastics & Rubber                                    
MFG Chemical, LLC (k)  L+6.00%  8.50%    6/23/2017  6/23/2022     10,477    10,366    10,335    4.0%
MFG Chemical, LLC  L+6.00%  8.50%    3/15/2018  6/23/2022     1,129    1,129    1,114    0.4%
                    11,606    11,495    11,449    4.4%
Consumer Goods: Durable                                    
RugsUSA, LLC  L+6.00%  8.61%    5/2/2018  4/28/2023     4,000    3,967    3,990    1.5%
                    4,000    3,967    3,990    1.5%

 

9

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED SCHEDULE OF INVESTMENTS – (continued)

(unaudited)

March 31, 2019

(in thousands, except for shares and units)

 

Portfolio Company (a)  Spread Above
 Index (b)
  Interest
Rate
   Acquisition
Date (c)
  Maturity    Principal   Amortized
Cost
   Fair
Value (d)
   % of
Net Assets (e)
 
Healthcare & Pharmaceuticals                                    
Collaborative Neuroscience Network, LLC  L+11.50%  14.00%    12/27/2012  n/a (m)   6,120    $6,102    $6,025    2.3%
Collaborative Neuroscience Network, LLC  n/a  12.00% Cash/ 3.00% PIK    4/14/2016  n/a (m)   306    306    306    0.1%
Collaborative Neuroscience Network, LLC (Revolver)  L+10.00%  12.50%    5/25/2017  n/a (m)   200    193    200    0.1%
Priority Ambulance, LLC (r)  L+6.50%  9.10%    4/12/2017  4/12/2022     10,015    10,015    9,965    3.8%
Priority Ambulance, LLC (s)  L+6.50%  9.10%    12/13/2018  4/12/2022     1,253    1,228    1,247    0.5%
Priority Ambulance, LLC (Delayed Draw) (f) (g)  L+6.50%  9.10%    7/18/2018  4/12/2022     246            0.0%
Priority Ambulance, LLC (Delayed Draw) (f) (g)  L+6.50%  9.10%    12/13/2018  4/12/2022     2,485    446    444    0.2%
                    20,625    18,290    18,187    7.0%
High Tech Industries                                    
Energy Services Group, LLC  L+8.42%  10.92%    5/4/2017  5/4/2022     4,337    4,297    4,337    1.7%
Energy Services Group, LLC (h) (o)  L+8.42%  9.42%    5/4/2017  5/4/2022     5,092    5,122    5,092    2.0%
Energy Services Group, LLC  L+8.42%  10.92%    5/4/2017  5/4/2022     1,234    1,219    1,234    0.5%
Mnine Holdings, Inc.  L+6.75%  9.25%    11/2/2018  11/2/2023     7,980    7,830    8,024    3.2%
                    18,643    18,468    18,687    7.4%
  Total Non-Controlled/Non-Affiliate Unitranche Secured Loans                   54,874    52,220    52,313    20.3%
                                     
  Junior Secured Loans                                    
Beverage, Food & Tobacco                                    
CSM Bakery Supplies, LLC  L+7.75%  10.55%    5/23/2013  7/5/2021     5,792    5,792    5,430    2.1%
                    5,792    5,792    5,430    2.1%
High Tech Industries                                    
Micro Holdings Corp.  L+7.50%  9.99%    8/16/2017  8/18/2025     3,000    2,972    2,963    1.1%
                    3,000    2,972    2,963    1.1%
Media: Broadcasting & Subscription                                    
Mergermarket Bidco Limited  L+7.25%  9.75%    7/26/2017  8/4/2025     4,500    4,459    4,472    1.7%
                    4,500    4,459    4,472    1.7%
Media: Diversified & Production                                    
The Octave Music Group, Inc.  L+8.25%  10.73%    5/29/2015  5/27/2022     5,000    4,959    5,000    1.9%
                    5,000    4,959    5,000    1.9%
Services: Consumer                                    
Education Corporation of America  L+11.00%  8.10% Cash/ 5.50% PIK (n)   9/3/2015  3/31/2020     2,292    2,289    2,292    0.9%
                    2,292    2,289    2,292    0.9%
  Total Non-Controlled/Non-Affiliate Junior Secured Loans                   20,584    20,471    20,157    7.7%
                                     
  Equity Securities (t) (u)                                    
Banking, Finance, Insurance & Real Estate                                    
PKS Holdings, LLC (warrant to purchase up to 0.8% of the equity) (h)    (v)   11/30/2017  11/30/2027         116    13    0.0%
                         116    13    0.0%
Chemicals, Plastics & Rubber                                    
Valudor Products, LLC (501,014 class A-1 units)  n/a  10.00% PIK    6/18/2018          501    323    0.1%
                         501    323    0.1%
Healthcare & Pharmaceuticals                                    
Collaborative Neuroscience Network, LLC (warrant to purchase up to 1.5% of the equity)    (v)   12/27/2012  12/27/2022             190    0.1%
Collaborative Neuroscience Network, LLC (warrant to purchase up to 2.1% of the equity)    (v)  7/19/2016  12/31/2027                 0.0%
                             190    0.1%
High Tech Industries                                    
Answers Finance, LLC (76,539 shares of common stock)    (v)   4/14/2017          2,413    172    0.0%
Host Analytics, Inc. (441,860 class A Units)    (v)   12/28/2018          442    453    0.2%
                         2,855    625    0.2%
Hotels, Gaming & Leisure                                    
Playtime, LLC - Preferred Units (8,665 units)    (v)   12/4/2012          200        0.0%
                         200        0.0%
Media: Advertising, Printing & Publishing                                    
AdTheorent, Inc. (128,866 class A voting units)    (v)   12/22/2016          129    262    0.1%
InMobi Pte, Ltd. (warrant to purchase up to 2.8% of the equity) (h) (l)    (v)   9/18/2015  9/18/2025             209    0.1%
                         129    471    0.2%
Media: Diversified & Production                                    
ATTOM Holdco LLC (260,000 class A units)    (v)   1/4/2019          260    256    0.1%
                         260    256    0.1%

 

10

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED SCHEDULE OF INVESTMENTS – (continued)

(unaudited)

March 31, 2019

(in thousands, except for shares and units)

 

Portfolio Company (a)  Spread Above
 Index (b)
  Interest
Rate
  Acquisition
Date (c)
  Maturity    Principal   Amortized
Cost
   Fair
Value (d)
   % of
Net Assets (e)
 
Retail                                    
The Tie Bar Operating Company, LLC - Class A Preferred Units (1,275 units)      6/25/2013         $87   $110    0.0%
The Tie Bar Operating Company, LLC - Class B Preferred Units (1,275 units)      6/25/2013                  0.0%
                         87    110    0.0%
Services: Business                                    
APCO Worldwide, Inc. (100 shares class A voting common stock)    (v)   11/1/2017          395    307    0.2%
Atlas Sign Industries of FLA, LLC (warrants to purchase up to 0.8% of the equity)    (v)   5/14/2018  5/14/2026         125    85    0.0%
                         520    392    0.2%
Services: Consumer                                    
Education Corporation of America - Series G Preferred Stock (8,333 shares)  n/a  12.00% PIK (n)   9/3/2015          7,492    4,583    1.8%
                         7,492    4,583    1.8%
Wholesale                                    
Nearly Natural, Inc. (152,174 class A units)    (v)   12/15/2017          152    132    0.1%
                         152    132    0.1%
  Total Non-Controlled/Non-Affiliate Equity Securities               12,312    7,095    2.8%
Total Non-Controlled/Non-Affiliate Company Investments           $510,881   $505,957    195.3%
                                     
Non-Controlled Affiliate Company Investments (w)                                    
  Senior Secured Loans                                    
Banking, Finance, Insurance & Real Estate                                    
American Community Homes, Inc.  L+10.00%  12.50% PIK    7/22/2014  12/31/2020     8,046   $8,031   $6,574    2.5%
American Community Homes, Inc.  L+14.50%  17.00% PIK    7/22/2014  12/31/2020     4,931    4,923    4,028    1.5%
American Community Homes, Inc.  L+10.00%  12.50% PIK    3/17/2016  12/31/2020     609    607    497    0.2%
American Community Homes, Inc.  L+10.00%  12.50% PIK    5/24/2017  12/31/2020     488    486    399    0.2%
American Community Homes, Inc.  L+14.50%  17.00% PIK    5/24/2017  12/31/2020     265    264    217    0.1%
American Community Homes, Inc.  L+8.00%  10.50% PIK    8/10/2018  12/31/2020     1,778    1,778    1,452    0.5%
American Community Homes, Inc.  L+8.00%  10.50% PIK    3/29/2019  12/31/2020     3,333    3,333    2,723    1.1%
                    19,450    19,422    15,890    6.1%
Containers, Packaging & Glass                                    
Summit Container Corporation (k)  L+8.00%  10.50%    12/5/2013  1/6/2021     3,259    3,269    3,029    1.2%
Summit Container Corporation (Revolver) (f) (k)  L+8.00%  10.50%    6/15/2018  1/6/2021     8,000    5,685    5,634    2.2%
                    11,259    8,954    8,663    3.4%
Healthcare & Pharmaceuticals                                    
SHI Holdings, Inc. (k)  L+10.25%  12.75% PIK    7/10/2014  12/31/2020     2,637    2,634    2,612    1.0%
SHI Holdings, Inc. (Revolver) (f)  L+10.25%  12.75% PIK    7/10/2014  12/31/2020     4,227    3,547    3,515    1.4%
                    6,864    6,181    6,127    2.4%
Retail                                    
Luxury Optical Holdings Co.  L+8.00%  10.50% PIK    9/12/2014  9/12/2019     4,824    4,815    4,429    1.7%
Luxury Optical Holdings Co. (Delayed Draw) (f) (g)  L+11.50%  14.00%    9/29/2017  9/12/2019     1,059    624    622    0.2%
Luxury Optical Holdings Co. (Revolver)  L+8.00%  10.50% PIK    9/12/2014  9/12/2019     222    222    204    0.1%
                    6,105    5,661    5,255    2.0%
Services: Business                                    
Curion Holdings, LLC (k)  n/a  14.00% PIK    5/2/2017  5/2/2022     4,080    4,041    3,723    1.4%
Curion Holdings, LLC (Revolver) (f)  n/a  14.00% PIK    5/2/2017  5/2/2022     462    256    250    0.1%
                    4,542    4,297    3,973    1.5%
  Total Non-Controlled Affiliate Senior Secured Loans        48,220    44,515    39,908    15.4%
                                     
  Unitranche Secured Loans (q)                         
Consumer Goods: Non-Durable                                    
Incipio, LLC (x)  L+9.06%  11.00% Cash/ 0.56% PIK (y)   12/26/2014  5/31/2019     13,803    13,777    12,685    4.9%
Incipio, LLC (z)  L+8.50%  11.00%    3/9/2018  5/31/2019     3,613    3,613    3,599    1.4%
Incipio, LLC  L+8.50%  11.00%    7/6/2018  5/31/2019     1,535    1,535    1,529    0.6%
                    18,951    18,925    17,813    6.9%
  Total Non-Controlled Affiliate Unitranche Secured Loans        18,951    18,925    17,813    6.9%

 

11

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED SCHEDULE OF INVESTMENTS – (continued)

(unaudited)

March 31, 2019

(in thousands, except for shares and units)

 

Portfolio Company (a)  Spread Above
 Index (b)
  Interest
Rate
   Acquisition
Date (c)
  Maturity    Principal   Amortized
Cost
   Fair
Value (d)
   % of
Net Assets (e)
 
  Junior Secured Loans                                    
Consumer Goods: Non-Durable                                    
Incipio, LLC (aa)  n/a  10.70% PIK (n)   6/18/2018  12/31/2020     3,766   $   $1,109    0.4%
Incipio, LLC (ab)  n/a  10.70% PIK (n)   6/18/2018  12/31/2020     7,194            0.0%
                    10,960        1,109    0.4%
Services: Business                                    
Curion Holdings, LLC (k)  n/a  15.00% PIK (n)   8/17/2018  1/2/2023     1,720    1        0.0%
Curion Holdings, LLC (k)  n/a  15.00% PIK (n)   8/17/2018  1/2/2023     44            0.0%
                    1,764    1        0.0%
  Total Non-Controlled Affiliate Company Junior Secured Loans        12,724    1    1,109    0.4%
                                     
  Equity Securities (u)                                    
Banking, Finance, Insurance & Real Estate                                    
American Community Homes, Inc. (warrant to purchase up to 22.3% of the equity)    (v)   10/9/2014  12/18/2024                 0.0%
                                 0.0%
Consumer Goods: Non-Durable                                    
Incipio, LLC (1,774 shares of series C common units)    (v)   7/6/2018                  0.0%
Millennial Brands LLC (10 preferred units)    (v)   5/2/2014          967        0.0%
Millennial Brands LLC (75,502 common units)    (v)   5/2/2014                  0.0%
                         967        0.0%
Containers, Packaging & Glass                                    
Summit Container Corporation (warrant to purchase up to 19.5% of the equity)    (v)   1/6/2014  1/6/2024                 0.0%
                                 0.0%
Healthcare & Pharmaceuticals                                    
SHI Holdings, Inc. (24 shares of common stock)    (v)   12/14/2016          27    126    0.0%
                         27    126    0.0%
Retail                                    
Luxury Optical Holdings Co. (86 shares of common stock)    (v)   9/29/2017                  0.0%
                                 0.0%
Services: Business                                    
Curion Holdings, LLC (58,779 shares of common stock)    (v)   8/17/2018                  0.0%
                                 0.0%
  Total Non-Controlled Affiliate Equity Securities             994    126    0.0%
Total Non-Controlled Affiliate Company Investments            $64,435   $58,956    22.7%
                                     
Controlled Affiliate Company Investments (ac)                                    
  Equity Securities                                    
Investment Funds & Vehicles                                    
MRCC Senior Loan Fund I, LLC (50.0% of the equity interests) (h)       10/31/2017         $31,275   $32,032    12.4%
  Total Controlled Affiliate Equity Securities             31,275    32,032    12.4%
Total Controlled Affiliate Company Investments            $31,275   $32,032    12.4%
                                     
TOTAL INVESTMENTS                       $606,591   $596,945    230.4%

 

12

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED SCHEDULE OF INVESTMENTS – (continued)

(unaudited)

March 31, 2019

(in thousands, except for shares and units)

 

Derivative Instruments

 

Foreign currency forward contracts

 

   Notional Amount   Notional Amount         Unrealized Gain 
Description     to be Purchased   to be Sold   Counterparty       Settlement Date  (Loss) 
Foreign currency forward contract  $137   £106     Bannockburn Global Forex, LLC  4/1/2019  $(3)
Foreign currency forward contract  $293   £229     Bannockburn Global Forex, LLC  5/31/2019   (5)
Foreign currency forward contract  $135   £106     Bannockburn Global Forex, LLC  7/1/2019   (3)
Foreign currency forward contract  $294   £230     Bannockburn Global Forex, LLC  8/30/2019   (5)
Foreign currency forward contract  $134   £105     Bannockburn Global Forex, LLC  10/1/2019   (2)
Foreign currency forward contract  $295   £230     Bannockburn Global Forex, LLC  11/29/2019   (5)
Foreign currency forward contract  $133   £104     Bannockburn Global Forex, LLC  1/2/2020   (2)
Foreign currency forward contract  $296   £231     Bannockburn Global Forex, LLC  2/28/2020   (5)
Foreign currency forward contract  $132   £103     Bannockburn Global Forex, LLC  4/1/2020   (2)
Foreign currency forward contract  $130   £102     Bannockburn Global Forex, LLC  5/5/2020   (2)
Foreign currency forward contract  $296   £230     Bannockburn Global Forex, LLC  5/29/2020   (5)
Foreign currency forward contract  $295   £230     Bannockburn Global Forex, LLC  8/28/2020   (5)
Foreign currency forward contract  $294   £229     Bannockburn Global Forex, LLC  11/30/2020   (5)
                   $(49)

 

 

(a)All of our investments are issued by eligible portfolio companies, as defined in the Investment Company Act of 1940 (the “1940 Act”), unless otherwise noted. All of our investments are issued by U.S. portfolio companies unless otherwise noted.
(b)The majority of the investments bear interest at a rate that may be determined by reference to the London Interbank Offered Rate (“LIBOR” or “L”) or Prime Rate (“Prime” or “P”) which reset daily, monthly, quarterly, or semiannually. For each such investment, the Company has provided the spread over LIBOR or Prime and the current contractual interest rate in effect at March 31, 2019. Certain investments are subject to a LIBOR or Prime interest rate floor, or rate cap.
(c)Except as otherwise noted, all of the Company’s portfolio company investments, which as of March 31, 2019 represented 230.4% of the Company’s net assets or 95.0% of the Company’s total assets, are subject to legal restrictions on sales.
(d)Because there is no readily available market value for these investments, the fair value of these investments is determined in good faith using significant unobservable inputs by our board of directors as required by the Investment Company Act of 1940. (See Note 4 in the accompanying notes to the consolidated financial statements.)
(e)Percentages are based on net assets of $259,052 as of March 31, 2019.
(f)All or a portion of this commitment was unfunded at March 31, 2019. As such, interest is earned only on the funded portion of this commitment.
(g)This delayed draw loan requires that certain financial covenants be met by the portfolio company prior to any fundings.
(h)This investment is treated as a non-qualifying investment under Section 55(a) of the 1940 Act. Under the 1940 Act, the Company may not acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of the Company’s total assets. As of March 31, 2019, non-qualifying assets totaled 16.10% of the Company’s total assets.
(i)The PIK portion of the interest rate for HFZ Capital Group, LLC is structured as a fee paid upon the termination of the commitment. The fee currently accrues at 0.17% per annum.
(j)This investment represents a note convertible to preferred shares of the borrower.
(k)All of this loan is held in the Company’s wholly-owned subsidiary, Monroe Capital Corporation SBIC, LP, and is therefore not collateral to the Company’s revolving credit facility.
(l)This is an international company.
(m)This is a demand note with no stated maturity.
(n)This position was on non-accrual status as of March 31, 2019, meaning that the Company has ceased accruing interest income on the position. See Note 2 in the accompanying notes to the consolidated financial statements for additional information on the Company’s accounting policies.
(o)This loan is denominated in Great Britain pounds and is translated into U.S. dollars as of the valuation date.
(p)A portion of the PIK interest rate for TRG, LLC is structured as a fee paid upon the termination of the commitment. The fee currently accrues at 3.44% per annum.
(q)The Company structures its unitranche secured loans as senior secured loans. The Company obtains security interests in the assets of these portfolio companies that serve as collateral in support of the repayment of these loans. This collateral may take the form of first-priority liens on the assets of a portfolio company. Generally, the Company syndicates a “first out” portion of the loan to an investor and retains a “last out” portion of the loan, in which case the “first out” portion of the loan will generally receive priority with respect to payments of principal, interest and any other amounts due thereunder. Unitranche structures combine characteristics of traditional first lien senior secured as well as second lien and subordinated loans and the Company’s unitranche secured loans will expose the Company to the risks associated with second lien and subordinated loans and may limit the Company’s recourse or ability to recover collateral upon a portfolio company’s bankruptcy. Unitranche secured loans typically provide for moderate loan amortization in the initial years of the facility, with the majority of the amortization deferred until loan maturity. Unitranche secured loans generally allow the borrower to make a large lump sum payment of principal at the end of the loan term, and there is a risk of loss if the borrower is unable to pay the lump sum or refinance the amount owed at maturity. In many cases the Company, together with its affiliates, are the sole or majority lender of these unitranche secured loans, which can afford the Company additional influence with a borrower in terms of monitoring and, if necessary, remediation in the event of underperformance.
(r)A portion of this loan (principal of $9,258) is held in the Company’s wholly-owned subsidiary, Monroe Capital Corporation SBIC, LP, and is therefore not collateral to the Company’s revolving credit facility.

 

13

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED SCHEDULE OF INVESTMENTS – (continued)

(unaudited)

March 31, 2019

(in thousands, except for shares and units)

 

(s)A portion of this loan (principal of $525) is held in the Company’s wholly-owned subsidiary, Monroe Capital Corporation SBIC, LP, and is therefore not collateral to the Company’s revolving credit facility.
(t)Represents less than 5% ownership of the portfolio company’s voting securities.
(u)Ownership of certain equity investments may occur through a holding company or partnership.
(v)Represents a non-income producing security.
(w)As defined in the 1940 Act, the Company is deemed to be an “Affiliated Person” of the portfolio company as it owns five percent or more of the portfolio company’s voting securities. See Note 5 in the accompanying notes to the consolidated financial statements for additional information on transactions in which the issuer was an Affiliated Person (but not a portfolio company that the Company is deemed to control).
(x)A portion of this loan (principal of $5,061) is held in the Company’s wholly-owned subsidiary, Monroe Capital Corporation SBIC, LP, and is therefore not collateral to the Company’s revolving credit facility.
(y)The PIK portion of the interest rate for Incipio Technologies, Inc. is structured as a fee paid upon the termination of the commitment. The fee currently accrues at 0.56% per annum.
(z)A portion of this loan (principal of $46) is held in the Company’s wholly-owned subsidiary, Monroe Capital Corporation SBIC, LP, and is therefore not collateral to the Company’s revolving credit facility.
(aa)A portion of this loan (principal of $1,015) is held in the Company’s wholly-owned subsidiary, Monroe Capital Corporation SBIC, LP, and is therefore not collateral to the Company’s revolving credit facility.
(ab)A portion of this loan (principal of $1,938) is held in the Company’s wholly-owned subsidiary, Monroe Capital Corporation SBIC, LP, and is therefore not collateral to the Company’s revolving credit facility.
(ac)As defined in the 1940 Act, the Company is deemed to be both an “Affiliated Person” of and to “Control” this portfolio company as it owns more than 25% in company’s voting securities. See Note 5 in the accompanying notes to the consolidated financial statements for additional information on transactions in which the issuer was both an Affiliated Person and a portfolio company that the Company is deemed to Control.

n/a - not applicable

 

See Notes to Consolidated Financial Statements.

 

14

 

  

MONROE CAPITAL CORPORATION 

 

CONSOLIDATED SCHEDULE OF INVESTMENTS

December 31, 2018

(in thousands, except for shares and units)

 

Portfolio Company (a)  Spread
Above
 Index (b)
  Interest
Rate
   Maturity  Principal   Amortized
Cost
   Fair
Value (c)
   % of Net
Assets (d)
 
Non-Controlled/Non-Affiliate Company Investments                               
Senior Secured Loans                               
Automotive                               
Hastings Manufacturing Company  L+8.25%   10.76%  4/24/2023   2,944   $2,891   $2,883    1.1%
Hastings Manufacturing Company (Delayed Draw) (e) (f)  L+8.25%   10.76%  4/24/2023   899            0.0%
Magneto & Diesel Acquisition, Inc.  L+5.50%   8.01%  12/18/2023   5,000    4,913    4,913    1.9%
Magneto & Diesel Acquisition, Inc. (Revolver) (e)  L+5.50%   8.01%  12/18/2023   500    83    82    0.0%
               9,343    7,887    7,878    3.0%
Banking, Finance, Insurance & Real Estate                               
Echelon Funding I, LLC (Delayed Draw) (e) (f) (g)  L+7.50%   9.85%  2/24/2021   15,750    15,253    15,146    5.9%
HFZ Capital Group, LLC (g)   L+10.17%   12.39% Cash/
0.17% PIK
(h)  10/21/2019   18,000    17,819    18,009    7.0%
HFZ Member RB Portfolio LLC (Delayed Draw) (e) (f) (g)  L+12.00%   14.54%  10/29/2021   9,000    3,708    3,706    1.4%
Liftforward SPV II, LLC (e) (g)  L+10.75%   13.27%  11/10/2020   10,000    4,088    4,132    1.6%
PKS Holdings, LLC (g)  L+10.00%   12.35%  11/30/2022   1,755    1,605    1,675    0.6%
PKS Holdings, LLC (Revolver) (e) (g)   L+10.00%   12.35%  11/30/2022   80            0.0%
               54,585    42,473    42,668    16.5%
Beverage, Food & Tobacco                               
California Pizza Kitchen, Inc.  L+6.00%   8.53%  8/23/2022   6,843    6,793    6,654    2.6%
Toojay's Management LLC  L+5.50%   8.01%  10/26/2022   3,500    3,433    3,497    1.4%
Toojay's Management LLC (Delayed Draw) (e) (f)  L+5.50%   8.01%  10/26/2022   477            0.0%
Toojay's Management LLC (Revolver) (e)  L+5.50%   8.01%  10/26/2022   159    79    79    0.0%
               10,979    10,305    10,230    4.0%
Chemicals, Plastics & Rubber                               
Midwest Composite Technologies, LLC  L+6.75%   9.26%  8/31/2023   898    881    907    0.4%
Midwest Composite Technologies, LLC (Delayed Draw) (e) (f)  L+6.75%   9.26%  8/31/2023   600            0.0%
Midwest Composite Technologies, LLC (Revolver) (e)  L+6.75%   9.26%  8/31/2023   90            0.0%
Valudor Products LLC  L+7.50%   10.01%  6/19/2023   1,604    1,575    1,600    0.6%
Valudor Products LLC (i)  L+7.50%   10.01%  6/19/2023   211    205    210    0.1%
Valudor Products LLC (Revolver) (e)  L+9.50%   12.01%  6/19/2023   818    606    607    0.2%
               4,221    3,267    3,324    1.3%

 

15

 

 

MONROE CAPITAL CORPORATION

 

CONSOLIDATED SCHEDULE OF INVESTMENTS – (continued)

December 31, 2018

(in thousands, except for shares and units)

 

Portfolio Company (a)  Spread
Above
 Index (b)
  Interest
Rate
   Maturity  Principal   Amortized
Cost
   Fair
Value (c)
   % of Net
Assets (d)
 
Construction & Building                               
Cali Bamboo, LLC  L+6.25%   8.76%  7/10/2020   5,264   $5,231   $5,264    2.0%
Cali Bamboo, LLC (Revolver) (e)  L+6.25%   8.76%  7/10/2020   2,165    1,689    1,689    0.7%
Construction Supply Acquisition, LLC  L+6.00%   8.62%  6/30/2023   4,791    4,767    4,779    1.8%
Cornerstone Detention Products, Inc. (j)   L+11.83%   11.01% Cash/
3.33% PIK
(k)  4/8/2019   3,350    3,346    3,350    1.3%
Cornerstone Detention Products, Inc. (Revolver) (e)  L+8.50%   11.01%  4/8/2019   1,000    200    200    0.1%
Inland Pipe Rehabilitation LLC  L+5.50%   8.29%  12/26/2024   12,500    12,251    12,250    4.7%
Inland Pipe Rehabilitation LLC (Revolver) (e)  L+5.50%   7.87%  12/26/2024   4,118    2,305    2,259    0.9%
               33,188    29,789    29,791    11.5%
Consumer Goods: Durable                               
Nova Wildcat Amerock, LLC  L+5.75%