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Section 1: 10-Q (10-Q)

Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
ý
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2018
OR
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission File Number: 814-00659 
PROSPECT CAPITAL CORPORATION
(Exact name of Registrant as specified in its charter)
Maryland
43-2048643
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
10 East 40th Street, 42nd Floor
 
New York, New York
10016
(Address of principal executive offices)
(Zip Code)
Registrant's telephone number, including area code: (212) 448-0702

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 ý    No o
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 (§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 o    No o
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer ý
Accelerated filer o
Non-accelerated filer o
Smaller reporting company o
 (Do not check if a smaller reporting company)
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o    No ý
Indicate the number of shares outstanding of each of the issuer's classes of common stock as of the latest practicable date.
Class of Common Stock
 
Outstanding at May 9, 2018
$0.001 par value
 
363,265,564




Table of Contents
 
 
Page
 
PART I
FINANCIAL INFORMATION
 
 
 
 
 
 
 
 
PART II
OTHER INFORMATION
 
 
 




FORWARD-LOOKING STATEMENTS
This report contains information that may constitute “forward-looking statements.” Generally, the words “believe,” “expect,”
“intend,” “estimate,” “anticipate,” “project,” “will” and similar expressions identify forward-looking statements, which generally are not historical in nature. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future—including statements relating to volume growth, share of sales and earnings per share growth, and statements expressing general views about future operating results—are forward-looking statements. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in Part II, “Item 1A. Risk Factors” and elsewhere in this report and in our Annual Report on Form 10-K for the year ended June 30, 2017, and those described from time to time in our future reports filed with the Securities and Exchange Commission.

3


PART I
Item 1. Financial Statements
PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
(in thousands, except share and per share data)
 
March 31, 2018
 
June 30, 2017
 
 
 
(Unaudited)
 
(Audited)
Assets
 
 
 

Investments at fair value:
 

 
 

Control investments (amortized cost of $1,857,698 and $1,840,731, respectively)
$
1,986,984

 
$
1,911,775

Affiliate investments (amortized cost of $55,482 and $22,957, respectively)
52,288

 
11,429

Non-control/non-affiliate investments (amortized cost of $3,951,787 and $4,117,868, respectively)
3,680,532

 
3,915,101

Total investments at fair value (amortized cost of $5,864,967 and $5,981,556, respectively)
5,719,804

 
5,838,305

Cash
97,563

 
318,083

Receivables for:
 
 
 
Interest, net
29,511

 
9,559

Other
836

 
924

Prepaid expenses
566

 
1,125

Due from Broker

 

Due from Prospect Capital Management (Note 13)
60

 

Due from Affiliate (Note 13)
88

 
14

Deferred financing costs on Revolving Credit Facility (Note 4)
2,717

 
4,779

Total Assets 
5,851,145

 
6,172,789

Liabilities 
 

 
 

Revolving Credit Facility (Notes 4 and 8)
86,000

 

Convertible Notes (less unamortized debt issuance costs of $11,908 and $15,512, respectively)
(Notes 5 and 8)
805,092

 
937,641

Prospect Capital InterNotes® (less unamortized debt issuance costs of $12,342 and $14,240,
respectively) (Notes 7 and 8)
743,729

 
966,254

Public Notes (less unamortized discount and debt issuance costs of $9,445 and $10,981,
respectively) (Notes 6 and 8)
739,836

 
738,300

Due to Prospect Capital Management (Note 13)
47,009

 
48,249

Interest payable
29,588

 
38,630

Due to Broker
24,457

 
50,371

Dividends payable
21,759

 
30,005

Due to Prospect Administration (Note 13)
2,148

 
1,910

Accrued expenses
4,320

 
4,380

Other liabilities
811

 
2,097

Total Liabilities 
2,504,749

 
2,817,837

Commitments and Contingencies (Note 3)

 

Net Assets 
$
3,346,396

 
$
3,354,952

 
 
 
 
Components of Net Assets 
 

 
 

Common stock, par value $0.001 per share (1,000,000,000 common shares authorized; 362,657,362 and 360,076,933 issued and outstanding, respectively) (Note 9)
$
363

 
$
360

Paid-in capital in excess of par (Note 9)
4,009,704

 
3,991,317

Accumulated overdistributed net investment income
(59,174
)
 
(54,039
)
Accumulated net realized loss
(459,334
)
 
(439,435
)
Net unrealized loss
(145,163
)
 
(143,251
)
Net Assets 
$
3,346,396

 
$
3,354,952

 
 
 
 
Net Asset Value Per Share (Note 16) 
$
9.23

 
$
9.32


See notes to consolidated financial statements.
4


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(Unaudited)

 
Three Months Ended March 31,
 
Nine Months Ended March 31,
 
2018
 
2017
 
2018
 
2017
Investment Income
 
 
 
 
 
 
 
Interest income:
 
 
 
 
 
 
 
Control investments
$
45,944

 
$
41,353

 
$
139,392

 
$
135,543

Affiliate investments
271

 

 
476

 

Non-control/non-affiliate investments
68,376

 
83,794

 
216,639

 
257,919

Structured credit securities
31,271

 
36,564

 
90,822

 
114,690

Total interest income
145,862

 
161,711

 
447,329

 
508,152

Dividend income:
 
 
 
 
 
 
 
Control investments
5,639

 
728

 
5,639

 
4,250

Non-control/non-affiliate investments
648

 
89

 
1,518

 
330

Total dividend income
6,287

 
817

 
7,157

 
4,580

Other income:
 
 
 
 
 
 
 
Control investments
6,188

 
2,953

 
12,317

 
9,749

Non-control/non-affiliate investments
4,498

 
5,551

 
17,011

 
11,863

Total other income (Note 10)
10,686

 
8,504

 
29,328

 
21,612

Total Investment Income
162,835

 
171,032

 
483,814

 
534,344

Operating Expenses
 
 
 
 
 
 
 
Base management fee (Note 13)
29,268

 
30,549

 
88,990

 
92,227

Income incentive fee (Note 13)
17,612

 
18,270

 
51,843

 
59,101

Interest and credit facility expenses
37,479

 
41,464

 
117,861

 
123,981

Allocation of overhead from Prospect Administration (Note 13)
3,195

 
3,581

 
5,899

 
9,771

Audit, compliance and tax related fees
1,130

 
1,223

 
4,084

 
3,676

Directors’ fees
113

 
113

 
338

 
338

Excise tax

 

 

 
(1,100
)
Other general and administrative expenses
3,592

 
2,752

 
7,429

 
9,946

Total Operating Expenses
92,389

 
97,952

 
276,444

 
297,940

Net Investment Income
70,446

 
73,080

 
207,370

 
236,404

Net Realized and Net Change in Unrealized Gains (Losses) from Investments
 
 
 
 
 
 
 
Net realized gains (losses)
 
 
 
 
 
 
 
Control investments
2

 
1

 
13

 
184

Affiliate investments
(14,197
)
 

 
(13,351
)
 
137

Non-control/non-affiliate investments
(23
)
 
177

 
(5,116
)
 
489

Net realized (losses) gains
(14,218
)
 
178

 
(18,454
)
 
810

Net change in unrealized gains (losses)
 
 
 
 
 
 
 
Control investments
1,380

 
(33,235
)
 
46,898

 
(30,937
)
Affiliate investments
12,952

 
(581
)
 
19,678

 
(1,854
)
Non-control/non-affiliate investments
(18,188
)
 
(19,930
)
 
(68,488
)
 
(2,480
)
Net change in unrealized gains (losses)
(3,856
)
 
(53,746
)
 
(1,912
)
 
(35,271
)
Net Realized and Net Change in Unrealized Gains (Losses) from Investments
(18,074
)
 
(53,568
)
 
(20,366
)
 
(34,461
)
Net realized losses on extinguishment of debt
(513
)
 
(20
)
 
(1,445
)
 
(205
)
Net Increase in Net Assets Resulting from Operations
$
51,859

 
$
19,492

 
$
185,559

 
$
201,738

Net increase in net assets resulting from operations per share
$
0.14

 
$
0.05

 
$
0.51

 
$
0.56

Dividends declared per share
$
(0.18
)
 
$
(0.25
)
 
$
(0.59
)
 
$
(0.75
)

See notes to consolidated financial statements.
5


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS
(in thousands, except share data)
(Unaudited)

 
Nine Months Ended March 31,
 

2018
 
2017
Operations
 

 
 

Net investment income
$
207,370

 
$
236,404

Net realized (losses) gains
(19,899
)
 
605

Net change in net unrealized losses
(1,912
)
 
(35,271
)
Net Increase in Net Assets Resulting from Operations 
185,559

 
201,738

 
 
 
 
Distributions to Shareholders
 
 
 
Distribution from net investment income
(211,733
)
 
(268,989
)
Net Decrease in Net Assets Resulting from Distributions to Shareholders
(211,733
)
 
(268,989
)
 
 
 
 
Common Stock Transactions 
 
 
 
Value of shares issued through reinvestment of dividends
17,618

 
23,502

Net Increase in Net Assets Resulting from Common Stock Transactions
17,618

 
23,502

 
 
 
 
Total Decrease in Net Assets
(8,556
)
 
(43,749
)
Net assets at beginning of period
3,354,952

 
3,435,917

Net Assets at End of Period (Accumulated Overdistributed Net Investment Income of $59,174 and $33,719, respectively)
$
3,346,396

 
$
3,392,168

 
 
 
 
Common Stock Activity
 
 
 
Shares issued through reinvestment of dividends
2,580,429

 
2,778,472

  Shares issued and outstanding at beginning of period
360,076,933

 
357,107,231

Shares Issued and Outstanding at End of Period
362,657,362

 
359,885,703

 


See notes to consolidated financial statements.
6


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands, except share data)
(Unaudited)

 
Nine Months Ended March 31,
 
2018
 
2017
Operating Activities
 
 
 
Net increase in net assets resulting from operations
$
185,559

 
$
201,738

Net realized losses on extinguishment of debt
1,445

 
205

Net realized losses (gains) on investments
18,454

 
(810
)
Net change in net unrealized (gains) losses on investments
1,912

 
35,271

Amortization of discounts and (accretion of premiums), net
17,706

 
42,937

Accretion of discount on Public Notes (Note 6)
212

 
200

Amortization of deferred financing costs
9,168

 
10,128

Payment-in-kind interest
(6,128
)
 
(14,326
)
Structuring fees
(9,135
)
 
(11,674
)
Change in operating assets and liabilities:
 
 
 
Payments for purchases of investments
(1,375,555
)
 
(1,240,294
)
Proceeds from sale of investments and collection of investment principal
1,471,247

 
1,061,839

Decrease in due to Broker
(25,914
)
 
(957
)
Decrease in due to Prospect Capital Management
(1,240
)
 
(5,051
)
(Increase) decrease in interest receivable, net
(19,952
)
 
1,872

Decrease in interest payable
(9,042
)
 
(7,041
)
(Decrease) increase in accrued expenses
(60
)
 
2,033

Decrease in other liabilities
(1,286
)
 
(1,615
)
Decrease in other receivables
88

 
68

Increase in due from Prospect Administration
(60
)
 

Increase in due from affiliate
(74
)
 

Decrease in prepaid expenses
559

 
139

Increase in due to Prospect Administration
238

 
82

Net Cash Provided by Operating Activities
258,142

 
74,744

Financing Activities
 
 
 
Borrowings under Revolving Credit Facility (Note 4)
427,000

 
557,000

Principal payments under Revolving Credit Facility (Note 4)
(341,000
)
 
(557,000
)
Issuances of Public Notes, net of original issue discount (Note 6)

 
37,466

Redemptions of Convertible Notes (Note 5)
(136,153
)
 
(167,500
)
Issuances of Prospect Capital InterNotes® (Note 7)
69,428

 
109,221

Redemptions of Prospect Capital InterNotes®, net (Note 7)
(293,851
)
 
(12,170
)
Financing costs paid and deferred
(1,724
)
 
(2,500
)
Dividends paid
(202,362
)
 
(245,255
)
Net Cash Used in Financing Activities
(478,662
)
 
(280,738
)
 
 
 
 
Net Decrease in Cash
(220,520
)
 
(205,994
)
Cash at beginning of period
318,083

 
317,798

Cash at End of Period
$
97,563

 
$
111,804

Supplemental Disclosures
 
 
 
Cash paid for interest
$
117,523

 
$
120,694

Non-Cash Financing Activities
 
 
 
Value of shares issued through reinvestment of dividends
$
17,618

 
$
23,502

Cost basis of investments written off as worthless
$
20,235

 
$
2,535


See notes to consolidated financial statements.
7


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF INVESTMENTS
(in thousands, except share data)





March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)(47)
Principal Value
Amortized Cost
Fair
Value(2)
% of Net Assets










LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 










Control Investments (greater than 25.00% voting control)(47)
 
 
 
 










Arctic Energy Services, LLC(37)
Wyoming / Energy Equipment & Services
Class D Units (12.00%, 32,915 units)(16)
$

$
31,640

$
27,017

0.8%
Class E Units (14.00%, 21,080 units)(16)

23,800


—%
Class A Units (14.00%, 700 units)(16)

9,006


—%
Class C Units (10 units)(16)



—%





64,446

27,017

0.8%
CCPI Inc.(19)
Ohio / Electronic Equipment, Instruments & Components
Senior Secured Term Loan A (10.00%, due 12/31/2020)(3)
2,881

2,881

2,881

0.1%
Senior Secured Term Loan B (12.00% plus 7.00% PIK, due 12/31/2020)(3)(46)
17,819

17,819

17,819

0.5%
Common Stock (14,857 shares)

6,759

15,557

0.5%





27,459

36,257

1.1%
CP Energy Services Inc.(20)
Oklahoma / Energy Equipment & Services
Senior Secured Term Loan (12.69% (LIBOR + 11.00% with 1.00% LIBOR floor), due 12/29/2022)(11)
35,048

35,048

35,048

1.0%
Series B Convertible Preferred Stock (16.00%, 790 shares)(16)

63,225

55,135

1.7%
Common Stock (2,924 shares)(16)

15,227


—%





113,500

90,183

2.7%
Credit Central Loan Company, LLC(21)
South Carolina / Consumer Finance
Subordinated Term Loan (20.00% (10.00% plus 10.00% PIK, due 6/26/2019)(14)(46)
51,855

46,788

51,855

1.5%
Class A Units (10,640,642 units)(14)(16)

13,731

22,353

0.7%
Net Revenues Interest (25% of Net Revenues)(14)(16)


2,249

0.1%





60,519

76,457

2.3%
Echelon Transportation, LLC (f/k/a Echelon Aviation LLC)
New York / Aerospace & Defense
Senior Secured Term Loan (11.75% (LIBOR + 9.75% with 2.00% LIBOR floor) plus 2.25% PIK, due 3/31/2022)(13)(46)
31,055

31,055

31,055

0.9%
Senior Secured Term Loan (11.00% (LIBOR + 9.00% with 2.00% LIBOR floor) plus 1.00% PIK, due 12/7/2024)(13)(46)
16,044

16,044

16,044

0.5%
Membership Interest (100%)(16)

22,738

32,202

1.0%





69,837

79,301

2.4%
First Tower Finance Company LLC(23)
Mississippi / Consumer Finance
Subordinated Term Loan to First Tower, LLC (10.00% plus 7.00% PIK, due 6/24/2019)(14)(46)
272,170

272,170

272,170

8.1%
Class A Units (95,709,910 units)(14)(16)

81,146

162,981

4.9%





353,316

435,151

13.0%
Freedom Marine Solutions, LLC(24)
Louisiana / Energy Equipment & Services
Membership Interest (100%)(16)

43,292

13,188

0.4%





43,292

13,188

0.4%
MITY, Inc.(25)
Utah / Commercial Services & Supplies
Senior Secured Note A (10.00% (LIBOR + 7.00% with 3.00% LIBOR floor), due 1/30/2020)(3)(11)
26,250

26,250

26,250

0.8%
Senior Secured Note B (10.00% (LIBOR + 7.00% with 3.00% LIBOR floor) plus 10.00% PIK, due 1/30/2020)(3)(11)(46)
24,442

24,442

24,442

0.7%
Subordinated Unsecured Note to Broda Enterprises ULC (10.00%, due on demand)(14)
5,716

7,200

5,716

0.2%
Common Stock (42,053 shares)(16)

6,849

5,715

0.2%





64,741

62,123

1.9%

See notes to consolidated financial statements.
8


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF INVESTMENTS (CONTINUED)
(in thousands, except share data)




March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)(47)
Principal Value
Amortized Cost
Fair
Value(2)
% of Net Assets










LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 










Control Investments (greater than 25.00% voting control)(47)
 
 
 
 










National Property REIT Corp.(26)
Various / Equity Real Estate Investment Trusts (REITs) / Online Lending
Senior Secured Term Loan A (6.00% (LIBOR + 4.00% with 2.00% LIBOR floor) plus 10.50% PIK, due 4/1/2019)(11)(46)
$
293,203

$
293,203

$
293,203

8.8%
Senior Secured Term Loan E (11.00% (LIBOR + 9.00% with 2.00% LIBOR floor) plus 5.00% PIK, due 4/1/2019)(11)(46)
276,549

276,549

276,549

8.2%
Common Stock (2,748,812 shares)

257,527

369,123

11.0%
Net Operating Income Interest (5% of Net Operating Income)


92,275

2.8%





827,279

1,031,150

30.8%
Nationwide Loan Company LLC(27)
Illinois / Consumer Finance
Senior Subordinated Term Loan to Nationwide Acceptance LLC (10.00% plus 10.00% PIK, due 6/18/2019)(14)(46)
17,410

17,410

17,410

0.5%
Class A Units (32,456,159 units)(14)(16)

21,962

13,580

0.4%





39,372

30,990

0.9%
NMMB, Inc.(28)
New York / Media
Senior Secured Note (14.00%, due 5/6/2021)(3)
3,714

3,714

3,714

0.1%
Senior Secured Note to Armed Forces Communications, Inc. (14.00%, due 5/6/2021)(3)
6,900

6,900

6,900

0.2%
Series A Preferred Stock (7,200 shares)(16)

7,200

5,503

0.2%
Series B Preferred Stock (5,669 shares)(16)

5,669

4,332

0.1%





23,483

20,449

0.6%
R-V Industries, Inc.
Pennsylvania / Machinery
Senior Subordinated Note (11.31% (LIBOR + 9.00% with 1.00% LIBOR floor), due 3/31/2022)(3)(11)
28,622

28,622

28,622

0.8%
Common Stock (745,107 shares)(16)

6,866

2,403

0.1%





35,488

31,025

0.9%
SB Forging Company II, Inc. (f/k/a Gulf Coast Machine & Supply Company)(29)
Texas / Energy Equipment & Services
Series A Convertible Preferred Stock (6.50%, 99,000 shares)(16)


1,011

—%
Common Stock (100 shares)(16)



—%






1,011

—%
USES Corp.(30)
Texas / Commercial Services & Supplies
Senior Secured Term Loan A (9.00% PIK, in non-accrual status effective 4/1/2016, due 7/22/2020)
36,127

31,601

9,672

0.3%
Senior Secured Term Loan B (15.50% PIK, in non-accrual status effective 4/1/2016, due 7/22/2020)
46,019

35,568


—%
Common Stock (268,962 shares)(16)



—%





67,169

9,672

0.3%
Valley Electric Company, Inc.(31)
Washington / Construction & Engineering
Senior Secured Note to Valley Electric Co. of Mt. Vernon, Inc. (8.00% (LIBOR + 5.00% with 3.00% LIBOR floor) plus 2.50% PIK, due 12/31/2024)(3)(11)(46)
10,430

10,430

10,430

0.3%
Senior Secured Note (10.00% plus 8.50% PIK, due 6/23/2024)(46)
27,292

27,292

27,292

0.8%
Common Stock (50,000 shares)(16)

26,204

4,740

0.2%





63,926

42,462

1.3%
Wolf Energy, LLC(32)
Kansas / Energy Equipment & Services
Membership Interest (100%)(16)



—%
Membership Interest in Wolf Energy Services Company, LLC (100%)(16)

3,871

537

—%
Net Profits Interest (8% of Equity Distributions)(4)(16)


11

—%





3,871

548

—%
Total Control Investments (Level 3)
 
$
1,857,698

$
1,986,984

59.4%


See notes to consolidated financial statements.
9



 
 
 
March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)(48)
Principal Value
Cost
Fair
Value(2)
% of Net Assets
 
 
 
 
 
 
 
LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 
 
 
 
 
 
 
 
Affiliate Investments (5.00% to 24.99% voting control)(48)
 
 
 
 
 
 
 
 
 
 
 
Edmentum Ultimate Holdings, LLC(22)
Minnesota / Diversified Consumer Services
Second Lien Revolving Credit Facility to Edmentum, Inc. – $7,834 Commitment (5.00% PIK, due 12/9/2021)(15)
$
7,834

$
7,834

$
7,834

0.2%
Unsecured Senior PIK Note (8.50% PIK, due 12/9/2021)(46)
7,365

7,365

7,365

0.2%
Unsecured Junior PIK Note (10.00% PIK, in non-accrual status effective 1/1/2017, due 12/9/2021)
34,377

23,828

17,728

0.5%
Class A Units (370,964 units)(16)

6,577


—%
 
 
 
 
45,604

32,927

0.9%
Nixon, Inc.(39)
California / Textiles, Apparel & Luxury Goods
Common Stock (857 units)(16)



—%
 
 
 
 
 

—%
Targus Cayman HoldCo Limited(33)
California / Textiles, Apparel & Luxury Goods
Common Stock (7,383,395 shares)(16)

9,878

19,361

0.6%
 
 
 
 
9,878

19,361

0.6%
Total Affiliate Investments (Level 3)
 
$
55,482

$
52,288

1.5%


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF INVESTMENTS (CONTINUED)
(in thousands, except share data)

 
 
 
March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)
Principal Value
Amortized Cost
Fair
Value(2)
% of Net Assets
 
 
 
 
 
 
 
LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 
 
 
 
 
 
 
 
Non-Control/Non-Affiliate Investments (less than 5.00% voting control)
 
 
 
 
 
 
 
 
 
 
 
Ability Network Inc.
Minnesota / Health Care Technology
Second Lien Term Loan (9.54%. (LIBOR + 7.75% with 0.00% LIBOR floor), due 12/13/2025)(8)(13)
$
15,000

$
14,928

$
15,300

0.5%
 
 
 
 
14,928

15,300

0.5%
ACE Cash Express, Inc.
Texas / Consumer Finance
Senior Secured Note (12.00%, due 12/15/2022)(8)(14)
20,000

19,717

22,400

0.7%
 
 
 
 
19,717

22,400

0.7%
AgaMatrix, Inc.
New Hampshire / Healthcare Equipment and Supplies
Senior Secured Term Loan (11.06% (LIBOR + 8.75% with 1.25% LIBOR floor), due 9/29/2022)(3)(11)
31,250

31,250

31,250

0.9%
 
 
 
 
31,250

31,250

0.9%
American Gilsonite Company(34)
Utah / Chemicals
Membership Interest (0.05%, 131 shares)(16)



—%
 
 
 
 


—%
Apidos CLO IX
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 0.00%, due 7/15/2023)(5)(14)(17)
23,525

21

74

—%
 
 
 
 
21

74

—%
Apidos CLO XI
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 8.54%, due 10/17/2028)(5)(14)
40,500

31,872

25,091

0.8%
 
 
 
 
31,872

25,091

0.8%
Apidos CLO XII
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 16.49%, due 4/15/2031)(5)(14)
52,203

33,708

26,824

0.8%
 
 
 
 
33,708

26,824

0.8%
Apidos CLO XV
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 13.56%, due 4/20/2031)(5)(14)
48,515

35,161

27,452

0.8%
 
 
 
 
35,161

27,452

0.8%
Apidos CLO XXII
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 14.40%, due 10/20/2027)(5)(6)(14)
31,350

27,638

25,150

0.8%
 
 
 
 
27,638

25,150

0.8%
Ark-La-Tex Wireline Services, LLC
Louisiana / Energy Equipment & Services
Senior Secured Term Loan B (14.50% (LIBOR + 13.50% with 1.00% LIBOR floor), in non-accrual status effective 4/1/2016, due 4/8/2019)(13)
25,595

1,145

787

—%
 
 
 
 
1,145

787

—%
Armor Holding II LLC
New York / Commercial Services & Supplies
Second Lien Term Loan (11.30% (LIBOR + 9.00% with 1.25% LIBOR floor), due 12/26/2020)(3)(8)(11)
7,000

6,943

7,000

0.2%
 
 
 
 
6,943

7,000

0.2%
Atlantis Health Care Group (Puerto Rico), Inc.
Puerto Rico / Health Care Providers & Services
Revolving Line of Credit – $7,000 Commitment (10.19% (LIBOR + 8.50% with 1.50% LIBOR floor), due 8/21/2019)(11)(15)
7,000

7,000

6,934

0.2%
Senior Term Loan (10.19% (LIBOR + 8.50% with 1.50% LIBOR floor), due 2/21/2020)(3)(11)
78,949

78,949

78,200

2.3%
 
 
 
 
85,949

85,134

2.5%
ATS Consolidated, Inc.
Arizona / Electronic Equipment, Instruments & Components
Second Lien Term Loan (9.40% (LIBOR + 7.75%, due 2/27/2026)(8)(13)
15,000

14,851

14,866

0.4%
 
 
 
 
14,851

14,866

0.4%
Autodata, Inc./ Autodata Solutions, Inc.(9)
Canada / Software
Second Lien Term Loan (9.01% (LIBOR + 7.25% with 1.00% LIBOR floor), due 12/14/2025)(8)(13)
6,000

5,971

5,971

0.2%
 
 
 
 
5,971

5,971

0.2%

See notes to consolidated financial statements.
11


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF INVESTMENTS (CONTINUED)
(in thousands, except share data)

 
 
 
March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)
Principal Value
Amortized Cost
Fair
Value(2)
% of Net Assets
 
 
 
 
 
 
 
LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 
 
 
 
 
 
 
 
Non-Control/Non-Affiliate Investments (less than 5.00% voting control)
 
 
 
 
 
 
 
 
 
 
 
Babson CLO Ltd. 2014-III
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 12.43%, due 1/15/2026)(5)(6)(14)
$
52,250

$
40,709

$
34,638

1.0%
 
 
 
 
40,709

34,638

1.0%
Broder Bros., Co.
Pennsylvania / Textiles, Apparel & Luxury Goods
Senior Secured Note (10.31% (LIBOR + 8.00% with 1.25% LIBOR floor), due 12/02/2022)(3)(11)
455,400

455,400

455,400

13.6%
 
 
 
 
455,400

455,400

13.6%
Brookside Mill CLO Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 10.50%, due 1/18/2028)(5)(14)
36,300

18,873

13,613

0.4%
 
 
 
 
18,873

13,613

0.4%
California Street CLO IX Ltd. (f/k/a Symphony CLO IX Ltd.)
Cayman Islands / Structured Finance
Preference Shares (Residual Interest, current yield 14.21%, due 10/16/2028)(5)(14)
58,915

41,236

36,145

1.1%
 
 
 
 
41,236

36,145

1.1%
Candle-Lite Company, LLC
Ohio / Household & Personal Products
Senior Secured Term Loan A (7.48% (LIBOR + 5.50% with 1.25% LIBOR floor), due 1/23/2023)(3)(11)
12,500

12,500

12,500

0.4%
Senior Secured Term Loan B (11.48% (LIBOR + 9.50% with 1.25% LIBOR floor), due 1/23/2023)(3)(11)
12,500

12,500

12,500

0.4%
 
 
 
 
25,000

25,000

0.8%
Capstone Logistics Acquisition, Inc.
Georgia / Commercial Services & Supplies
Second Lien Term Loan (10.13% (LIBOR + 8.25% with 1.00% LIBOR floor), due 10/7/2022)(3)(8)(13)
101,517

101,135

99,329

3.0%
 
 
 
 
101,135

99,329

3.0%
Carlyle Global Market Strategies CLO 2014-4, Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 21.22%, due 10/15/2026)(5)(6)(14)
25,534

20,031

19,340

0.6%
 
 
 
 
20,031

19,340

0.6%
Carlyle Global Market Strategies CLO 2016-3, Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 16.87%, due 10/20/2029)(5)(6)(14)
32,200

32,146

29,102

0.9%
 
 
 
 
32,146

29,102

0.9%
Cent CLO 17 Limited
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 0.00%, due 1/30/2025)(5)(14)(17)
24,870

17,644

15,445

0.5%
 
 
 
 
17,644

15,445

0.5%
Cent CLO 20 Limited
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 15.78%, due 1/25/2026)(5)(14)
40,275

31,811

28,471

0.9%
 
 
 
 
31,811

28,471

0.9%
Cent CLO 21 Limited
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 19.00%, due 7/27/2026)(5)(6)(14)
48,528

36,585

34,166

1.0%
 
 
 
 
36,585

34,166

1.0%
Centerfield Media Holding Company(35)
California / Internet Software and Services
Senior Secured Term Loan A (8.69% (LIBOR + 7.00% with 1.00% LIBOR floor), due 1/17/2022)(3)(8)(11)
66,640

66,640

66,640

2.0%
Senior Secured Term Loan B (14.19% (LIBOR + 12.50% with 1.00% LIBOR floor), due 1/17/2022)(8)(11)
68,000

68,000

68,000

2.0%
 
 
 
 
134,640

134,640

4.0%
CIFC Funding 2013-III-R, Ltd. (f/k/a CIFC Funding 2013-III, Ltd.)
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 12.89%, due 4/24/2031)(5)(14)
44,100

29,946

25,853

0.8%
 
 
 
 
29,946

25,853

0.8%

See notes to consolidated financial statements.
12


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF INVESTMENTS (CONTINUED)
(in thousands, except share data)

 
 
 
March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)
Principal Value
Amortized Cost
Fair
Value(2)
% of Net Assets
 
 
 
 
 
 
 
LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 
 
 
 
 
 
 
 
Non-Control/Non-Affiliate Investments (less than 5.00% voting control)
 
 
 
 
 
 
 
 
 
 
 
CIFC Funding 2013-IV, Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 8.34%, due 11/27/2024)(5)(14)
$
45,500

$
31,530

$
28,084

0.8%
 
 
 
 
31,530

28,084

0.8%
CIFC Funding 2014-IV Investor, Ltd.
Cayman Islands / Structured Finance
Income Notes (Residual Interest, current yield 7.39%, due 10/17/2026)(5)(6)(14)
41,500

28,832

23,982

0.7%
 
 
 
 
28,832

23,982

0.7%
CIFC Funding 2016-I, Ltd.
Cayman Islands / Structured Finance
Income Notes (Residual Interest, current yield 12.61%, due 10/21/2028)(5)(6)(14)
34,000

31,268

28,106

0.8%
 
 
 
 
31,268

28,106

0.8%
Cinedigm DC Holdings, LLC
New York / Media
Senior Secured Term Loan (11.00% (LIBOR + 9.00% with 2.00% LIBOR floor) plus 2.50% PIK, due 3/31/2021)(11)(46)
39,710

39,660

39,710

1.2%
 
 
 
 
39,660

39,710

1.2%
Class Appraisal, LLC
Michigan / Real Estate Management & Development
Revolving Line of Credit – $1,500 Commitment (5%, due 3/12/2020)(11)(15)



—%
Senior Secured Term Loan (10.56% (LIBOR + 8.25% with 1.50% LIBOR floor), due 3/10/2023)(11)
42,000

42,000

42,000

1.3%
 
 
 
 
42,000

42,000

1.3%
Coverall North America, Inc.
Florida / Commercial Services & Supplies
Senior Secured Term Loan A (7.69% (LIBOR + 6.00% with 1.00% LIBOR floor), due 11/02/2020)(3)(11)
21,720

21,720

21,720

0.7%
Senior Secured Term Loan B (12.69% (LIBOR + 11.00% with 1.00% LIBOR floor), due 11/02/2020)(3)(11)
24,875

24,875

24,875

0.8%
 
 
 
 
46,595

46,595

1.5%
CP VI Bella Midco
Pennsylvania / IT Services
Second Lien Term Loan (8.63% (LIBOR + 6.75%, due 12/29/2025)(8)(13)
2,000

1,990

1,990

0.1%
 
 
 
 
1,990

1,990

0.1%
CURO Financial Technologies Corp.
Canada / Consumer Finance
Senior Secured Notes (12.00%, due 3/1/2022)(8)(14)
10,896

10,833

10,896

0.3%
 
 
 
 
10,833

10,896

0.3%
Digital Room, LLC
California / Commercial Services & Supplies
First Lien Term Loan (6.88% (LIBOR + 5.00% with 1.00% LIBOR floor), due 12/29/2023)(8)(13)
9,975

9,878

9,878

0.3%
Second Lien Term Loan (10.63% (LIBOR + 8.75% with 1.00% LIBOR floor), due 12/29/2024)(3)(8)(13)
57,100

56,264

56,264

1.7%
 
 
 
 
66,142

66,142

2.0%
Dunn Paper, Inc.
Georgia / Paper & Forest Products
Second Lien Term Loan (10.63% (LIBOR + 8.75% with 1.00% LIBOR floor), due 8/26/2023)(3)(8)(13)
11,500

11,320

11,500

0.3%
 
 
 
 
11,320

11,500

0.3%
Easy Gardener Products, Inc.
Texas / Household Durables
Senior Secured Term Loan (11.69% (LIBOR + 10.00% with 0.25% LIBOR floor), due 09/30/2020)(3)(11)
17,106

17,106

16,155

0.5%
 
 
 
 
17,106

16,155

0.5%
Engine Group, Inc.(7)
California / Media
Senior Secured Term Loan (7.05% (LIBOR + 4.75% with 1.00% LIBOR floor), due 9/15/2022)(8)(11)
4,875

4,875

4,875

0.2%
Second Lien Term Loan (11.05% (LIBOR + 8.75% with 1.00% LIBOR floor), due 9/15/2023)(3)(8)(11)
35,000

35,000

35,000

1.0%
 
 
 
 
39,875

39,875

1.2%

See notes to consolidated financial statements.
13


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF INVESTMENTS (CONTINUED)
(in thousands, except share data)

 
 
 
March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)
Principal Value
Amortized Cost
Fair
Value(2)
% of Net Assets
 
 
 
 
 
 
 
LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 
 
 
 
 
 
 
 
Non-Control/Non-Affiliate Investments (less than 5.00% voting control)
 
 
 
 
 
 
 
 
 
 
 
EXC Holdings III Corp.
Massachusetts / Technology Hardware, Storage & Peripherals
Second Lien Term Loan (9.71% (LIBOR + 7.50% with 1.00% LIBOR floor), due 12/01/2025)(8)(10)
$
12,500

$
12,380

$
12,500

0.4%
 
 
 
 
12,380

12,500

0.4%
Fleetwash, Inc.
New Jersey / Commercial Services & Supplies
Senior Secured Term Loan B (10.69% (LIBOR + 9.00% with 1.00% LIBOR floor), due 4/30/2022)(3)(11)
21,544

21,544

21,544

0.6%
Delayed Draw Term Loan – $15,000 Commitment (9.84% (LIBOR + 8.00% with 1.00% LIBOR floor), expires 4/30/2022)(11)(15)



—%
 
 
 
 
21,544

21,544

0.6%
Galaxy XV CLO, Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 11.81%, due 10/15/2030)(5)(14)
50,525

34,430

30,734

0.9%
 
 
 
 
34,430

30,734

0.9%
Galaxy XVI CLO, Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 4.64%, due 11/16/2025)(5)(14)
24,575

16,933

13,965

0.4%
 
 
 
 
16,933

13,965

0.4%
Galaxy XVII CLO, Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 5.40%, due 7/15/2026)(5)(6)(14)
39,905

27,977

22,618

0.7%
 
 
 
 
27,977

22,618

0.7%
Halcyon Loan Advisors Funding 2012-1 Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 0.00%, due 8/15/2023)(5)(14)(17)
23,188

3,955

4,680

0.1%
 
 
 
 
3,955

4,680

0.1%
Halcyon Loan Advisors Funding 2013-1 Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 0.00%, due 4/15/2025)(5)(14)(17)
40,400

23,045

16,134

0.5%
 
 
 
 
23,045

16,134

0.5%
Halcyon Loan Advisors Funding 2014-1 Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 5.03%, due 4/18/2026)(5)(14)
24,500

14,476

12,075

0.4%
 
 
 
 
14,476

12,075

0.4%
Halcyon Loan Advisors Funding 2014-2 Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 8.31%, due 4/28/2025)(5)(6)(14)
41,164

25,092

19,801

0.6%
 
 
 
 
25,092

19,801

0.6%
Halcyon Loan Advisors Funding 2015-3 Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 19.19%, due 10/18/2027)(5)(6)(14)
39,598

34,934

32,959

1.0%
 
 
 
 
34,934

32,959

1.0%
Harbortouch Payments, LLC
Pennsylvania / Commercial Services & Supplies
Escrow Receivable


900

—%
 
 
 
 

900

—%
HarbourView CLO VII, Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 20.59%, due 11/18/2026)(5)(6)(14)
19,025

15,549

13,823

0.4%
 
 
 
 
15,549

13,823

0.4%
Harley Marine Services, Inc.
Washington / Marine
Second Lien Term Loan (12.00% (LIBOR + 10.25% with 1.25% LIBOR floor), due 12/20/2019)(3)(8)(11)
9,000

8,943

8,879

0.3%
 
 
 
 
8,943

8,879

0.3%
Ingenio, LLC
California / Internet Software and Services
Senior Secured Term Loan (9.50% (LIBOR + 7.50% with 1.25% LIBOR floor), due 9/26/2022)(3)(8)(11)
10,000

10,000

10,000

0.3%
 
 
 
 
10,000

10,000

0.3%

See notes to consolidated financial statements.
14


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF INVESTMENTS (CONTINUED)
(in thousands, except share data)

 
 
 
March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)
Principal Value
Amortized Cost
Fair
Value(2)
% of Net Assets
 
 
 
 
 
 
 
LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 
 
 
 
 
 
 
 
Non-Control/Non-Affiliate Investments (less than 5.00% voting control)
 
 
 
 
 
 
 
 
 
 
 
Inpatient Care Management Company, LLC
Florida / Health Care Providers & Services
Senior Secured Term Loan (9.69% (LIBOR + 8.00% with 1.00% LIBOR floor), due 6/8/2021)(3)(11)
$
24,657

$
24,657

$
24,657

0.7%
 
 
 
 
24,657

24,657

0.7%
InterDent, Inc.
California / Health Care Providers & Services
Senior Secured Term Loan A (7.39% (LIBOR + 5.50% with 0.75% LIBOR floor), due 12/31/2017, past due)(13)
77,994

77,994

77,950

2.3%
Senior Secured Term Loan B (12.39% (LIBOR + 10.50% with 0.75% LIBOR floor), due 12/31/2017, past due)(13)
131,125

131,125

128,039

3.8%
Senior Secured Term Loan C (18.00% PIK, due on demand)(46)
3,012

3,012

2,560

0.1%
Warrants (to purchase 4,900 shares of Common Stock, expires 3/22/2030)



—%
 
 
 
 
212,131

208,549

6.2%
Janus International Group, LLC
Georgia / Building Products
Second Lien Term Loan (9.49% (LIBOR + 7.75% with 1.00% LIBOR floor), due 2/12/2026)(13)
10,000

9,902

10,000

0.3%
 
 
 
 
9,902

10,000

0.3%
JD Power and Associates
California / Capital Markets
Second Lien Term Loan (10.38% (LIBOR + 8.50% with 1.00% LIBOR floor), due 9/7/2024)(3)(8)(13)
20,000

19,792

20,000

0.6%
 
 
 
 
19,792

20,000

0.6%
Jefferson Mill CLO Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 7.70%, due 7/20/2027)(5)(6)(14)
19,500

16,286

12,489

0.4%
 
 
 
 
16,286

12,489

0.4%
K&N Parent, Inc.
California / Auto Components
Second Lien Term Loan (10.63% (LIBOR + 8.75% with 1.00% LIBOR floor), due 10/21/2024)(3)(8)(13)
13,000

12,786

12,948

0.4%
 
 
 
 
12,786

12,948

0.4%
Keystone Acquisition Corp.(36)
Pennsylvania / Health Care Providers & Services
Second Lien Term Loan (11.55% (LIBOR + 9.25% with 1.00% LIBOR floor), due 5/1/2025)(3)(8)(11)
50,000

50,000

50,000

1.5%
 
 
 
 
50,000

50,000

1.5%
LCM XIV Ltd.
Cayman Islands / Structured Finance
Income Notes (Residual Interest, current yield 0.00%, due 7/15/2025)(5)(14)(17)
30,500

19,520

13,337

0.4%
 
 
 
 
19,520

13,337

0.4%
Madison Park Funding IX, Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 28.65%, due 8/15/2022)(5)(14)
43,110

1,829

1,890

0.1%
 
 
 
 
1,829

1,890

0.1%
Maverick Healthcare Equity, LLC
Arizona / Health Care Providers & Services
Preferred Units (10.00%, 1,250,000 units)(16)

1,252

507

—%
Class A Common Units (1,250,000 units)(16)



—%
 
 
 
 
1,252

507

—%
MedMark Services, Inc. (51)
Texas / Health Care Providers & Services
Second Lien Term Loan (10.27% (LIBOR + 8.25% with 1.00% LIBOR floor), due 3/1/2025)(8)(11)
7,000

6,930

6,952

0.2%
 
 
 
 
6,930

6,952

0.2%
Memorial MRI & Diagnostic, LLC
Texas / Health Care Providers & Services
Senior Secured Term Loan (10.81% (LIBOR + 8.50% with 1.00% LIBOR floor), due 3/16/2022)(11)
37,240

37,240

37,240

1.1%
 
 
 
 
37,240

37,240

1.1%
Mountain View CLO 2013-I Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 15.87%, due 10/12/2030)(5)(14)
43,650

27,873

23,699

0.7%
 
 
 
 
27,873

23,699

0.7%

See notes to consolidated financial statements.
15


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF INVESTMENTS (CONTINUED)
(in thousands, except share data)

 
 
 
March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)
Principal Value
Amortized Cost
Fair
Value(2)
% of Net Assets
 
 
 
 
 
 
 
LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 
 
 
 
 
 
 
 
Non-Control/Non-Affiliate Investments (less than 5.00% voting control)
 
 
 
 
 
 
 
 
 
 
 
Mountain View CLO IX Ltd.
Cayman Islands / Structured Finance
Subordinated Notes (Residual Interest, current yield 13.94%, due 7/15/2027)(5)(6)(14)
$
47,830

$
40,436

$
37,445

1.1%
 
 
 
 
40,436

37,445

1.1%
National Home Healthcare Corp.
Michigan / Health Care Providers & Services
Second Lien Term Loan (10.74% (LIBOR + 9.00% with 1.00% LIBOR floor), due 12/8/2022)(3)(8)(13)
15,407

15,228

15,407

0.5%
 
 
 
 
15,228

15,407

0.5%
Octagon Investment Partners XV, Ltd.
Cayman Islands / Structured Finance
Income Notes (Residual Interest, current yield 14.76%, due 7/19/2030)(5)(14)
42,064

31,433

26,490

0.8%
 
 
 
 
31,433

26,490

0.8%
Octagon Investment Partners 18-R Ltd. (f/k/a Octagon Investment Partners XVIII, Ltd.)
Cayman Islands / Structured Finance
Income Notes (Residual Interest, current yield 15.86%, due 4/16/2031)(5)(6)(14)
46,016

26,236

23,418

0.7%
 
 
 
 
26,236

23,418

0.7%
Pacific World Corporation
California / Personal Products
Revolving Line of Credit – $21,000 Commitment (9.06% (LIBOR + 7.25% with 1.00% LIBOR floor), due 9/26/2020)(13)(15)
20,825

20,825

20,825

0.6%
Senior Secured Term Loan A (7.06% (LIBOR + 5.25% with 1.00% LIBOR floor), due 9/26/2020)(3)(13)
96,500

96,500

93,856

2.8%
Senior Secured Term Loan B (11.06% (LIBOR + 9.25% with 1.00% LIBOR floor), due 9/26/2020)(3)(13)
96,500

96,500

68,470

2.1%
Common Stock (6,778,414 units)(16)



—%
 
 
 
 
213,825

183,151

5.5%
Pearl Intermediate Parent LLC
Connecticut / Health Care Providers & Services
Second Lien Term Loan (8.03% (LIBOR + 6.25%, due 2/15/2026)(8)(13)
5,000

4,975

5,000

0.1%
 
 
 
 
4,975

5,000

0.1%
Pelican Products, Inc.
California / Chemicals
Second Lien Term Loan (10.13% (LIBOR + 8.25% with 1.00% LIBOR floor), due 4/9/2021)(3)(8)(13)
17,500

17,491

17,500

0.5%
 
 
 
 
17,491

17,500

0.5%
PeopleConnect Intermediate, LLC (f/k/a Intelius, Inc.)
Washington / Internet Software & Services
Revolving Line of Credit – $1,000 Commitment (11.20% (LIBOR + 9.50% with 1.00% LIBOR floor), due 7/1/2020)(11)(15)
500

500

500

—%
Senior Secured Term Loan A (8.20% (LIBOR + 6.50% with 1.00% LIBOR floor), due 7/1/2020)(3)(11)
19,069

19,069

19,069

0.6%
Senior Secured Term Loan B (14.20% (LIBOR + 12.50% with 1.00% LIBOR floor), due 7/1/2020)(3)(11)
20,284

20,284

20,284

0.6%
 
 
 
 
39,853

39,853

1.2%
PGX Holdings, Inc.(40)
Utah / Diversified Consumer Services
Second Lien Term Loan (10.89% (LIBOR + 9.00% with 1.00% LIBOR floor), due 9/29/2021)(3)(13)
118,289

118,289

118,289

3.5%
 
 
 
 
118,289

118,289

3.5%
PharMerica Corporation
Kentucky / Pharmaceuticals
Second Lien Term Loan (9.46% (LIBOR + 7.75% with 1.00% LIBOR floor), due 12/7/2025)(8)(13)
12,000

11,881

12,000

0.4%
 
 
 
 
11,881

12,000

0.4%
Photonis Technologies SAS
France / Electronic Equipment, Instruments & Components
First Lien Term Loan (9.80% (LIBOR + 7.50% with 1.00% LIBOR floor), due 9/18/2019)(8)(11)(14)
12,872

12,407

11,518

0.3%
 
 
 
 
12,407

11,518

0.3%

See notes to consolidated financial statements.
16


PROSPECT CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULES OF INVESTMENTS (CONTINUED)
(in thousands, except share data)

 
 
 
March 31, 2018 (Unaudited)
Portfolio Company
Locale / Industry
Investments(1)(44)
Principal Value
Amortized Cost
Fair
Value(2)
% of Net Assets
 
 
 
 
 
 
 
LEVEL 3 PORTFOLIO INVESTMENTS
 
 
 
 
 
 
 
 
 
 
 
Non-Control/Non-Affiliate Investments (less than 5.00% voting control)
 
 
 
 
 
 
 
 
 
 
 
PlayPower, Inc.
North Carolina / Leisure Products
Second Lien Term Loan (11.05% (LIBOR + 8.75% with 1.00% LIBOR floor), due 6/23/2022)(3)(8)(11)
$
11,000

$
10,898

$
11,000

0.3%
 
 
 
 
10,898

11,000

0.3%
Research Now Group, Inc.
Connecticut / Professional Services
First Lien Term Loan (7.86% (LIBOR + 5.50% with 1.00% LIBOR floor), due 12/20/2024)(8)(10)
10,000