UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
R
QUARTERLY REPORT PURSUANT TO SECTION
13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30,
2012
OR
¨
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to
_____
Commission File Number 814-00794
Golub Capital BDC, Inc.
(Exact name of registrant as specified in
its charter)
Delaware
|
|
27-2326940
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
150 South Wacker Drive, Suite 800
Chicago, IL 60606
(Address of principal executive offices)
(312) 205-5050
(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
þ
No
¨
Indicate by check mark whether the registrant
has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted
and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant
was required to submit and post such files). Yes
¨
No
¨
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions
of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2
of the Exchange Act.
Large accelerated filer
¨
|
Accelerated filer
þ
|
Non-accelerated filer
¨
(Do not check if a smaller reporting company)
|
Smaller reporting company
¨
|
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
¨
No
þ
As of August 6, 2012, the Registrant had
25,663,009 shares of common stock, $0.001 par value, outstanding.
Part I. Financial Information
|
|
|
|
Item 1.
|
Financial Statements
|
3
|
|
|
|
|
Consolidated Statements of Financial Condition as of June 30, 2012 (unaudited) and September 30, 2011
|
3
|
|
|
|
|
Consolidated Statements of Operations for the three and nine months ended June 30, 2012 (unaudited) and 2011 (unaudited)
|
4
|
|
|
|
|
Consolidated Statements of Changes in Net Assets for the nine months ended June 30, 2012 (unaudited) and 2011 (unaudited)
|
5
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|
Consolidated Statements of Cash Flows for the nine months ended June 30, 2012 (unaudited) and 2011 (unaudited)
|
6
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|
Consolidated Schedules of Investments as of June 30, 2012 (unaudited) and September 30, 2011
|
7
|
|
|
|
|
Notes to Consolidated Financial Statements
|
17
|
|
|
|
Item 2.
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
39
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|
|
|
Item 3.
|
Quantitative And Qualitative Disclosures About Market Risk
|
58
|
|
|
|
Item 4.
|
Controls and Procedures
|
59
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|
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|
Part II. Other Information
|
|
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|
|
Item 1.
|
Legal Proceedings
|
60
|
|
|
|
Item 1A.
|
Risk Factors
|
60
|
|
|
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
60
|
|
|
|
Item 3.
|
Defaults Upon Senior Securities
|
60
|
|
|
|
Item 4.
|
Removed and Reserved
|
60
|
|
|
|
Item 5.
|
Other Information
|
60
|
|
|
|
Item 6.
|
Exhibits
|
61
|
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Statements of Financial Condition
(In thousands, except share and per share data)
|
|
June 30, 2012
|
|
|
September 30, 2011
|
|
|
|
(unaudited)
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Investments, at fair value (cost of $635,252 and $462,961, respectively)
|
|
$
|
636,632
|
|
|
$
|
459,827
|
|
Cash and cash equivalents
|
|
|
18,070
|
|
|
|
46,350
|
|
Restricted cash and cash equivalents
|
|
|
45,059
|
|
|
|
23,416
|
|
Interest receivable
|
|
|
3,893
|
|
|
|
3,063
|
|
Unrealized appreciation on derivative instruments
|
|
|
149
|
|
|
|
-
|
|
Cash collateral on deposit with custodian
|
|
|
1,287
|
|
|
|
21,162
|
|
Deferred financing costs
|
|
|
6,082
|
|
|
|
5,345
|
|
Other assets
|
|
|
350
|
|
|
|
481
|
|
Total Assets
|
|
$
|
711,522
|
|
|
$
|
559,644
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Debt
|
|
$
|
329,800
|
|
|
$
|
237,683
|
|
Interest payable
|
|
|
2,269
|
|
|
|
1,066
|
|
Management and incentive fees payable
|
|
|
4,070
|
|
|
|
1,608
|
|
Unrealized depreciation on derivative instruments
|
|
|
-
|
|
|
|
1,986
|
|
Accounts payable and accrued expenses
|
|
|
1,172
|
|
|
|
752
|
|
Total Liabilities
|
|
|
337,311
|
|
|
|
243,095
|
|
|
|
|
|
|
|
|
|
|
Net Assets
|
|
|
|
|
|
|
|
|
Preferred stock, par value $0.001 per share, 1,000,000 shares authorized, zero shares issued and outstanding as of June 30, 2012 and September 30, 2011
|
|
|
-
|
|
|
|
-
|
|
Common stock, par value $0.001 per share, 100,000,000 shares authorized, 25,663,009 and 21,733,903 shares issued and outstanding as of June 30, 2012 and September 30, 2011, respectively
|
|
|
26
|
|
|
|
22
|
|
Paid in capital in excess of par
|
|
|
376,292
|
|
|
|
318,302
|
|
Capital distributions in excess of net investment income
|
|
|
(3,660
|
)
|
|
|
(398
|
)
|
Net unrealized appreciation (depreciation) on investments and derivative instruments
|
|
|
4,197
|
|
|
|
(1,519
|
)
|
Net realized (loss) gain on investments and derivative instruments
|
|
|
(2,644
|
)
|
|
|
142
|
|
Total Net Assets
|
|
|
374,211
|
|
|
|
316,549
|
|
Total Liabilities and Total Net Assets
|
|
$
|
711,522
|
|
|
$
|
559,644
|
|
|
|
|
|
|
|
|
|
|
Number of common shares outstanding
|
|
|
25,663,009
|
|
|
|
21,733,903
|
|
Net asset value per common share
|
|
$
|
14.58
|
|
|
$
|
14.56
|
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Statements of Operations (unaudited)
(In thousands, except share and per share data)
|
|
Three months ended June 30,
|
|
|
Nine months ended June 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
Investment income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
$
|
14,811
|
|
|
$
|
10,071
|
|
|
$
|
41,263
|
|
|
$
|
28,319
|
|
Dividend income
|
|
|
-
|
|
|
|
-
|
|
|
|
377
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investment income
|
|
|
14,811
|
|
|
|
10,071
|
|
|
|
41,640
|
|
|
|
28,319
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and other debt financing expenses
|
|
|
2,865
|
|
|
|
1,637
|
|
|
|
7,811
|
|
|
|
4,681
|
|
Base management fee
|
|
|
2,220
|
|
|
|
1,497
|
|
|
|
6,187
|
|
|
|
4,122
|
|
Incentive fee
|
|
|
1,917
|
|
|
|
113
|
|
|
|
4,261
|
|
|
|
525
|
|
Professional fees
|
|
|
538
|
|
|
|
500
|
|
|
|
1,685
|
|
|
|
1,558
|
|
Administrative service fee
|
|
|
489
|
|
|
|
224
|
|
|
|
1,207
|
|
|
|
611
|
|
General and administrative expenses
|
|
|
104
|
|
|
|
148
|
|
|
|
405
|
|
|
|
457
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
|
8,133
|
|
|
|
4,119
|
|
|
|
21,556
|
|
|
|
11,954
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
6,678
|
|
|
|
5,952
|
|
|
|
20,084
|
|
|
|
16,365
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) gain on investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized (loss) gain on investments
|
|
|
(70
|
)
|
|
|
71
|
|
|
|
(5,002
|
)
|
|
|
1,997
|
|
Net realized gain (loss) on derivative instruments
|
|
|
1,228
|
|
|
|
-
|
|
|
|
2,216
|
|
|
|
-
|
|
Net change in unrealized (depreciation) appreciation on investments
|
|
|
(795
|
)
|
|
|
759
|
|
|
|
3,580
|
|
|
|
258
|
|
Net change in unrealized (depreciation) appreciation on derivative instruments
|
|
|
(1,648
|
)
|
|
|
(262
|
)
|
|
|
2,136
|
|
|
|
(262
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) gain on investments
|
|
|
(1,285
|
)
|
|
|
568
|
|
|
|
2,930
|
|
|
|
1,993
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase in net assets resulting from operations
|
|
$
|
5,393
|
|
|
$
|
6,520
|
|
|
$
|
23,014
|
|
|
$
|
18,358
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per Common Share Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per common share
|
|
$
|
0.21
|
|
|
$
|
0.31
|
|
|
$
|
0.97
|
|
|
$
|
0.97
|
|
Dividends and distributions declared per common share
|
|
$
|
0.32
|
|
|
$
|
0.32
|
|
|
$
|
0.96
|
|
|
$
|
0.95
|
|
Basic and diluted weighted average common shares outstanding
|
|
|
25,639,680
|
|
|
|
21,319,348
|
|
|
|
23,803,762
|
|
|
|
18,923,395
|
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Statements of Changes in Net Assets (unaudited)
(In thousands, except share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Unrealized
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
|
|
|
Appreciation
|
|
|
Net Realized Gain
|
|
|
|
|
|
|
Common Stock
|
|
|
Paid in Capital
|
|
|
Distributions
|
|
|
(Depreciation) on
|
|
|
(Loss) on Investments
|
|
|
|
|
|
|
|
|
|
Par
|
|
|
in Excess
|
|
|
in Excess of Net
|
|
|
Investments and
|
|
|
and Derivative
|
|
|
Total
|
|
|
|
Shares
|
|
|
Amount
|
|
|
of Par
|
|
|
Investment Income
|
|
|
Derivative Instruments
|
|
|
Instruments
|
|
|
Net Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at September 30, 2010
|
|
|
17,712,444
|
|
|
$
|
18
|
|
|
$
|
258,568
|
|
|
$
|
-
|
|
|
$
|
1,995
|
|
|
$
|
(40
|
)
|
|
$
|
260,541
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock, net of offering and underwriting costs
(1)
|
|
|
3,953,257
|
|
|
|
4
|
|
|
|
58,606
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
58,610
|
|
Net increase in net assets resulting from operations
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
16,365
|
|
|
|
(4
|
)
|
|
|
1,997
|
|
|
|
18,358
|
|
Distributions to stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock issued in connection with dividend reinvestment plan
|
|
|
68,202
|
|
|
|
-
|
|
|
|
1,128
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,128
|
|
Dividends and distributions
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(18,114
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(18,114
|
)
|
Balance at June 30, 2011
|
|
|
21,733,903
|
|
|
$
|
22
|
|
|
$
|
318,302
|
|
|
$
|
(1,749
|
)
|
|
$
|
1,991
|
|
|
$
|
1,957
|
|
|
$
|
320,523
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at September 30, 2011
|
|
|
21,733,903
|
|
|
$
|
22
|
|
|
$
|
318,302
|
|
|
$
|
(398
|
)
|
|
$
|
(1,519
|
)
|
|
$
|
142
|
|
|
$
|
316,549
|
|
Issuance of common stock, net of offering and underwriting costs
(2)
|
|
|
3,825,000
|
|
|
|
4
|
|
|
|
56,463
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
56,467
|
|
Net increase in net assets resulting from operations
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
20,084
|
|
|
|
5,716
|
|
|
|
(2,786
|
)
|
|
|
23,014
|
|
Distributions to stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock issued in connection with dividend reinvestment plan
|
|
|
104,106
|
|
|
|
-
|
|
|
|
1,527
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,527
|
|
Dividends and distributions
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(23,346
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(23,346
|
)
|
Balance at June 30, 2012
|
|
|
25,663,009
|
|
|
$
|
26
|
|
|
$
|
376,292
|
|
|
$
|
(3,660
|
)
|
|
$
|
4,197
|
|
|
$
|
(2,644
|
)
|
|
$
|
374,211
|
|
(1) On April 6, 2011, Golub Capital BDC, Inc. closed on a public
offering of 3,500,000 shares of its common stock at a public offering price of $15.75 per share. On May 2, 2011, Golub Capital
BDC, Inc. sold an additional 453,257 shares of its common stock at a public offering price of $15.75 per share pursuant to the
underwriters’ partial exercise of the over-allotment option.
(2) On February 3, 2012, Golub Capital BDC, Inc. closed on a
public offering of 3,500,000 shares of its common stock at a public offering price of $15.35 per share. On March 1, 2012 Golub
Capital BDC, Inc. sold an additional 325,000 shares of its common stock at a public offering price of $15.35 per share pursuant
to the underwriters’ partial exercise of the over-allotment option.
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Statements of Cash Flows (unaudited)
(In thousands)
|
|
Nine Months Ended June 30,
|
|
|
|
2012
|
|
|
2011
|
|
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
Net increase in net assets resulting from operations
|
|
$
|
23,014
|
|
|
$
|
18,358
|
|
Adjustments to reconcile net increase in net assets resulting from operations to net cash (used in) operating activities
|
|
|
|
|
|
|
|
|
Amortization of deferred financing costs
|
|
|
1,072
|
|
|
|
564
|
|
Amortization of discount and premium
|
|
|
(3,447
|
)
|
|
|
(4,146
|
)
|
Net realized loss (gain) on investments
|
|
|
5,002
|
|
|
|
(1,997
|
)
|
Net realized (gain) loss on derivative instruments
|
|
|
(2,216
|
)
|
|
|
-
|
|
Net change in unrealized (appreciation) depreciation on investments
|
|
|
(3,580
|
)
|
|
|
4
|
|
Net change in unrealized (appreciation) depreciation on derivative instruments
|
|
|
(2,136
|
)
|
|
|
-
|
|
(Fundings of) revolving loans, net
|
|
|
(2,438
|
)
|
|
|
(1,696
|
)
|
Fundings of investments
|
|
|
(292,943
|
)
|
|
|
(274,831
|
)
|
Proceeds from principal payments and sales of portfolio investments
|
|
|
120,602
|
|
|
|
188,943
|
|
Proceeds from derivative instruments
|
|
|
2,216
|
|
|
|
-
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Interest receivable
|
|
|
(830
|
)
|
|
|
(618
|
)
|
Cash collateral on deposit with custodian
|
|
|
19,875
|
|
|
|
(11,460
|
)
|
Open trade receivable
|
|
|
-
|
|
|
|
(17,015
|
)
|
Other assets
|
|
|
131
|
|
|
|
(185
|
)
|
Interest payable
|
|
|
1,203
|
|
|
|
27
|
|
Management and incentive fees payable
|
|
|
2,462
|
|
|
|
609
|
|
Payable for investments purchased
|
|
|
-
|
|
|
|
(5,328
|
)
|
Due to broker
|
|
|
-
|
|
|
|
860
|
|
Accounts payable and accrued expenses
|
|
|
420
|
|
|
|
46
|
|
Net cash (used in) operating activities
|
|
|
(131,593
|
)
|
|
|
(107,865
|
)
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
Net change in restricted cash and cash equivalents
|
|
|
(21,643
|
)
|
|
|
2,492
|
|
Net cash (used in) provided by investing activities
|
|
|
(21,643
|
)
|
|
|
2,492
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
Borrowings on debt
|
|
|
154,817
|
|
|
|
48,300
|
|
Repayments of debt
|
|
|
(62,700
|
)
|
|
|
-
|
|
Capitalized debt financing costs
|
|
|
(1,810
|
)
|
|
|
(1,654
|
)
|
Proceeds from shares sold, net of underwriting costs
|
|
|
57,164
|
|
|
|
59,420
|
|
Offering costs paid
|
|
|
(696
|
)
|
|
|
(810
|
)
|
Dividends and distributions paid
|
|
|
(21,819
|
)
|
|
|
(16,985
|
)
|
Net cash provided by financing activities
|
|
|
124,956
|
|
|
|
88,271
|
|
|
|
|
|
|
|
|
|
|
Net change in cash and cash equivalents
|
|
|
(28,280
|
)
|
|
|
(17,102
|
)
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, beginning of period
|
|
|
46,350
|
|
|
|
61,219
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
|
$
|
18,070
|
|
|
$
|
44,117
|
|
|
|
|
|
|
|
|
|
|
Supplemental information:
|
|
|
|
|
|
|
|
|
Cash paid during the period for interest
|
|
$
|
5,537
|
|
|
$
|
4,089
|
|
Dividends and distributions declared during the period
|
|
$
|
23,346
|
|
|
$
|
18,114
|
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments (unaudited)
June 30, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
|
|
Investment
|
|
Spread Above
|
|
|
Interest
|
|
|
Maturity
|
|
|
Principal
|
|
|
|
|
|
of
|
|
|
Fair
|
|
|
|
Type
|
|
Index
(1)
|
|
|
Rate
(2)
|
|
|
Date
|
|
|
Amount
|
|
|
Cost
|
|
|
Net Assets
|
|
|
Value
|
|
Investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Canada
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Leisure, Amusement, Motion
Pictures,
Entertainment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Extreme Fitness, Inc.
(5)(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.50
|
%
|
|
|
11/2015
|
|
|
$
|
2,870
|
|
|
$
|
2,810
|
|
|
|
0.4
|
%
|
|
$
|
1,435
|
|
Extreme Fitness, Inc.
|
|
Senior loan
|
|
|
N/A
|
|
|
|
8.00
|
%
|
|
|
10/2012
|
|
|
|
389
|
|
|
|
389
|
|
|
|
0.1
|
%
|
|
|
389
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Canada
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
3,259
|
|
|
|
3,199
|
|
|
|
0.5
|
%
|
|
$
|
1,824
|
|
Fair Value as percentage of Principal Amount
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
56.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aerospace and Defense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Whitcraft LLC
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
12.00
|
%
|
|
|
12/2018
|
|
|
$
|
1,877
|
|
|
$
|
1,847
|
|
|
|
0.5
|
%
|
|
$
|
1,877
|
|
Automobile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ABRA, Inc.
(3)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
N/A
|
(4)
|
|
|
04/2017
|
|
|
|
-
|
|
|
|
(23
|
)
|
|
|
-
|
|
|
|
-
|
|
ABRA, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
13.50
|
%
|
|
|
04/2017
|
|
|
|
9,696
|
|
|
|
9,506
|
|
|
|
2.6
|
|
|
|
9,696
|
|
American Driveline Systems, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.00
|
%
|
|
|
01/2016
|
|
|
|
2,869
|
|
|
|
2,817
|
|
|
|
0.8
|
|
|
|
2,869
|
|
American Driveline Systems, Inc.
|
|
Senior loan
|
|
|
P + 4.50
|
%
|
|
|
7.75
|
%
|
|
|
01/2016
|
|
|
|
282
|
|
|
|
274
|
|
|
|
0.1
|
|
|
|
282
|
|
CLP Auto Interior Corporation*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
5.00
|
%
|
|
|
06/2013
|
|
|
|
3,070
|
|
|
|
3,070
|
|
|
|
0.8
|
|
|
|
2,947
|
|
Federal-Mogul Corporation
|
|
Senior loan
|
|
|
L + 1.93
|
%
|
|
|
2.18
|
%
|
|
|
12/2014
|
|
|
|
1,981
|
|
|
|
1,934
|
|
|
|
0.5
|
|
|
|
1,890
|
|
Federal-Mogul Corporation
|
|
Senior loan
|
|
|
L + 1.93
|
%
|
|
|
2.18
|
%
|
|
|
12/2015
|
|
|
|
1,011
|
|
|
|
986
|
|
|
|
0.3
|
|
|
|
964
|
|
Heartland Automotive Services II, Inc.*
|
|
Senior loan
|
|
|
P + 4.00
|
%
|
|
|
7.25
|
%
|
|
|
01/2014
|
|
|
|
591
|
|
|
|
547
|
|
|
|
0.2
|
|
|
|
591
|
|
Heartland Automotive Services II, Inc.
(6)
|
|
Senior loan
|
|
|
P + 6.00
|
%
|
|
|
9.25
|
%
|
|
|
01/2014
|
|
|
|
451
|
|
|
|
417
|
|
|
|
0.1
|
|
|
|
451
|
|
K&N Engineering, Inc.
(3)
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2016
|
|
|
|
-
|
|
|
|
(7
|
)
|
|
|
-
|
|
|
|
-
|
|
K&N Engineering, Inc.
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
7.50
|
%
|
|
|
12/2016
|
|
|
|
3,232
|
|
|
|
3,174
|
|
|
|
0.9
|
|
|
|
3,232
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23,183
|
|
|
|
22,695
|
|
|
|
6.3
|
|
|
|
22,922
|
|
Banking
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prommis Fin Co.*
(5)(6)
|
|
Senior loan
|
|
|
L + 10.25
|
%
|
|
|
10.50
|
%
|
|
|
06/2015
|
|
|
|
191
|
|
|
|
191
|
|
|
|
-
|
|
|
|
162
|
|
Prommis Fin Co.*
(5)(6)
|
|
Senior loan
|
|
|
L + 10.25
|
%
|
|
|
10.50
|
%
|
|
|
06/2015
|
|
|
|
383
|
|
|
|
383
|
|
|
|
0.1
|
|
|
|
253
|
|
Prommis Fin Co.*
(5)(6)
|
|
Senior loan
|
|
|
L + 10.25
|
%
|
|
|
10.50
|
%
|
|
|
06/2015
|
|
|
|
191
|
|
|
|
191
|
|
|
|
-
|
|
|
|
-
|
|
Prommis Fin Co.
|
|
Senior loan
|
|
|
L + 9.00
|
%
|
|
|
10.00
|
%
|
|
|
06/2015
|
|
|
|
82
|
|
|
|
81
|
|
|
|
-
|
|
|
|
82
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
847
|
|
|
|
846
|
|
|
|
0.1
|
|
|
|
497
|
|
Beverage, Food and Tobacco
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ABP Corporation*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.75
|
%
|
|
|
06/2016
|
|
|
|
4,547
|
|
|
|
4,476
|
|
|
|
1.2
|
|
|
|
4,547
|
|
ABP Corporation
(3)
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(6
|
)
|
|
|
-
|
|
|
|
-
|
|
Ameriqual Group, LLC*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
03/2016
|
|
|
|
1,797
|
|
|
|
1,770
|
|
|
|
0.5
|
|
|
|
1,707
|
|
Ameriqual Group, LLC*
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
9.01
|
%
|
|
|
03/2016
|
|
|
|
842
|
|
|
|
829
|
|
|
|
0.2
|
|
|
|
757
|
|
Atkins Nutrionals, Inc.
|
|
Senior loan
|
|
|
L + 8.75
|
%
|
|
|
10.25
|
%
|
|
|
12/2015
|
|
|
|
5,028
|
|
|
|
4,918
|
|
|
|
1.3
|
|
|
|
5,028
|
|
Bertucci's Corporation*
|
|
Second lien
|
|
|
L + 11.14
|
%
|
|
|
14.14
|
%
|
|
|
07/2012
|
|
|
|
1,837
|
|
|
|
1,836
|
|
|
|
0.5
|
|
|
|
1,837
|
|
Candy Intermediate Holdings, Inc.*
|
|
Senior loan
|
|
|
L + 6.25
|
%
|
|
|
7.50
|
%
|
|
|
06/2018
|
|
|
|
5,000
|
|
|
|
4,825
|
|
|
|
1.3
|
|
|
|
4,998
|
|
First Watch Restaurants, Inc.*
|
|
Senior loan
|
|
|
P + 6.50
|
%
|
|
|
9.75
|
%
|
|
|
12/2016
|
|
|
|
11,559
|
|
|
|
11,352
|
|
|
|
3.1
|
|
|
|
11,559
|
|
First Watch Restaurants, Inc.
(3)
|
|
Senior loan
|
|
|
P + 6.50
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2016
|
|
|
|
-
|
|
|
|
(31
|
)
|
|
|
-
|
|
|
|
-
|
|
First Watch Restaurants, Inc.
(3)
|
|
Senior loan
|
|
|
P + 6.50
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2016
|
|
|
|
-
|
|
|
|
(31
|
)
|
|
|
-
|
|
|
|
-
|
|
IL Fornaio (America) Corporation*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.50
|
%
|
|
|
06/2017
|
|
|
|
4,605
|
|
|
|
4,586
|
|
|
|
1.2
|
|
|
|
4,605
|
|
It'Sugar LLC
|
|
Senior loan
|
|
|
L + 8.50
|
%
|
|
|
10.00
|
%
|
|
|
04/2017
|
|
|
|
4,266
|
|
|
|
4,184
|
|
|
|
1.1
|
|
|
|
4,180
|
|
It'Sugar LLC
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
8.00
|
%
|
|
|
10/2017
|
|
|
|
1,707
|
|
|
|
1,707
|
|
|
|
0.5
|
|
|
|
1,707
|
|
Julio & Sons Company*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.00
|
%
|
|
|
09/2016
|
|
|
|
7,139
|
|
|
|
7,079
|
|
|
|
1.9
|
|
|
|
7,139
|
|
Julio & Sons Company
(3)
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
N/A
|
(4)
|
|
|
09/2014
|
|
|
|
-
|
|
|
|
(17
|
)
|
|
|
-
|
|
|
|
-
|
|
Julio & Sons Company
(3)
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
N/A
|
(4)
|
|
|
09/2016
|
|
|
|
-
|
|
|
|
(13
|
)
|
|
|
-
|
|
|
|
-
|
|
Noodles & Company*
|
|
Senior loan
|
|
|
L + 4.00
|
%
|
|
|
5.25
|
%
|
|
|
02/2016
|
|
|
|
1,609
|
|
|
|
1,597
|
|
|
|
0.4
|
|
|
|
1,609
|
|
Richelieu Foods, Inc.*
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
7.75
|
%
|
|
|
11/2015
|
|
|
|
2,139
|
|
|
|
2,100
|
|
|
|
0.5
|
|
|
|
2,032
|
|
Richelieu Foods, Inc.
|
|
Senior loan
|
|
|
P + 5.00
|
%
|
|
|
8.25
|
%
|
|
|
11/2015
|
|
|
|
22
|
|
|
|
10
|
|
|
|
-
|
|
|
|
(8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
52,097
|
|
|
|
51,171
|
|
|
|
13.7
|
|
|
|
51,697
|
|
Broadcasting and Entertainment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Univision Communications Inc.
|
|
Senior loan
|
|
|
L + 2.00
|
%
|
|
|
2.25
|
%
|
|
|
09/2014
|
|
|
|
5,000
|
|
|
|
4,960
|
|
|
|
1.3
|
|
|
|
4,919
|
|
Building and Real Estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASP PDM Acquisition Co. LLC*
|
|
Senior loan
|
|
|
L + 6.25
|
%
|
|
|
7.75
|
%
|
|
|
12/2013
|
|
|
|
454
|
|
|
|
441
|
|
|
|
0.1
|
|
|
|
341
|
|
Global Claims Services, Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.25
|
%
|
|
|
06/2018
|
|
|
|
833
|
|
|
|
821
|
|
|
|
0.2
|
|
|
|
820
|
|
Global Claims Services, Inc.
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.25
|
%
|
|
|
06/2018
|
|
|
|
7
|
|
|
|
5
|
|
|
|
-
|
|
|
|
5
|
|
KHKI Acquisition, Inc.
|
|
Senior loan
|
|
|
P + 5.00
|
%
|
|
|
8.50
|
%
|
|
|
03/2013
|
|
|
|
2,626
|
|
|
|
2,625
|
|
|
|
0.6
|
|
|
|
2,101
|
|
Tecta America Corp.
|
|
Senior loan
|
|
|
P + 5.75
|
%
|
|
|
9.00
|
%
|
|
|
03/2014
|
|
|
|
2,928
|
|
|
|
2,928
|
|
|
|
0.6
|
|
|
|
2,416
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,848
|
|
|
|
6,820
|
|
|
|
1.5
|
|
|
|
5,683
|
|
Cargo Transport
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TMW Systems, Inc.*
|
|
Senior loan
|
|
|
L + 4.25
|
%
|
|
|
5.77
|
%
|
|
|
05/2016
|
|
|
|
1,859
|
|
|
|
1,837
|
|
|
|
0.5
|
|
|
|
1,859
|
|
Chemicals, Plastics and Rubber
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Road Infrastructure Investment, LLC*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.25
|
%
|
|
|
03/2018
|
|
|
|
4,148
|
|
|
|
4,088
|
|
|
|
1.1
|
|
|
|
4,106
|
|
Road Infrastructure Investment, LLC
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
5.44
|
%
|
|
|
03/2017
|
|
|
|
365
|
|
|
|
321
|
|
|
|
0.1
|
|
|
|
356
|
|
Solutia, Inc.
|
|
Senior loan
|
|
|
L + 2.75
|
%
|
|
|
3.50
|
%
|
|
|
08/2012
|
|
|
|
2,353
|
|
|
|
2,353
|
|
|
|
0.6
|
|
|
|
2,353
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,866
|
|
|
|
6,762
|
|
|
|
1.8
|
|
|
|
6,815
|
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments (unaudited) - (Continued)
June 30, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
|
|
Investment
|
|
|
Spread Above
|
|
|
Interest
|
|
|
Maturity
|
|
|
Principal
|
|
|
|
|
|
of Total
|
|
|
Fair
|
|
|
|
Type
|
|
|
Index
(1)
|
|
|
Rate
(2)
|
|
|
Date
|
|
|
Amount
|
|
|
Cost
|
|
|
Net Assets
|
|
|
Value
|
|
Containers, Packaging and Glass
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fort Dearborn Company*
|
|
Senior loan
|
|
|
|
L + 4.75
|
%
|
|
|
6.53
|
%
|
|
|
08/2015
|
|
|
$
|
1,373
|
|
|
$
|
1,355
|
|
|
|
0.4
|
%
|
|
$
|
1,373
|
|
Fort Dearborn Company*
|
|
Senior loan
|
|
|
|
L + 5.25
|
%
|
|
|
7.04
|
%
|
|
|
08/2016
|
|
|
|
3,167
|
|
|
|
3,123
|
|
|
|
0.8
|
|
|
|
3,167
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,540
|
|
|
|
4,478
|
|
|
|
1.2
|
|
|
|
4,540
|
|
Diversified Conglomerate Manufacturing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oasis Outsourcing Holdings, Inc.
(6)
|
|
Subordinated debt
|
|
|
|
N/A
|
|
|
|
13.00
|
%
|
|
|
04/2017
|
|
|
|
11,970
|
|
|
|
11,762
|
|
|
|
3.2
|
|
|
|
11,970
|
|
Pasternack Enterprises, Inc.*
|
|
Senior loan
|
|
|
|
L + 4.50
|
%
|
|
|
6.00
|
%
|
|
|
02/2014
|
|
|
|
3,671
|
|
|
|
3,623
|
|
|
|
1.0
|
|
|
|
3,671
|
|
Sunless Merger Sub, Inc.*
|
|
Senior loan
|
|
|
|
L + 5.00
|
%
|
|
|
6.26
|
%
|
|
|
07/2016
|
|
|
|
2,352
|
|
|
|
2,342
|
|
|
|
0.6
|
|
|
|
2,352
|
|
Sunless Merger Sub, Inc.
(3)
|
|
Senior loan
|
|
|
|
L + 5.00
|
%
|
|
|
N/A
|
(4)
|
|
|
07/2016
|
|
|
|
-
|
|
|
|
(1
|
)
|
|
|
-
|
|
|
|
-
|
|
Tecomet Inc.*
|
|
Senior loan
|
|
|
|
L + 5.25
|
%
|
|
|
7.00
|
%
|
|
|
12/2015
|
|
|
|
4,419
|
|
|
|
4,362
|
|
|
|
1.2
|
|
|
|
4,419
|
|
Tecomet Inc.
(3)
|
|
Senior loan
|
|
|
|
L + 5.25
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(5
|
)
|
|
|
-
|
|
|
|
-
|
|
Vintage Parts, Inc.*
|
|
Senior loan
|
|
|
|
L + 6.00
|
%
|
|
|
8.50
|
%
|
|
|
12/2013
|
|
|
|
83
|
|
|
|
83
|
|
|
|
-
|
|
|
|
83
|
|
Vintage Parts, Inc.*
|
|
Senior loan
|
|
|
|
L + 8.00
|
%
|
|
|
9.75
|
%
|
|
|
12/2013
|
|
|
|
1,243
|
|
|
|
1,229
|
|
|
|
0.3
|
|
|
|
1,243
|
|
Vintage Parts, Inc.*
|
|
Senior loan
|
|
|
|
L + 5.50
|
%
|
|
|
5.96
|
%
|
|
|
12/2013
|
|
|
|
5,950
|
|
|
|
5,925
|
|
|
|
1.6
|
|
|
|
5,950
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29,688
|
|
|
|
29,320
|
|
|
|
7.9
|
|
|
|
29,688
|
|
Diversified Conglomerate Service
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
API Healthcare Corporation*
|
|
Senior loan
|
|
|
|
L + 9.69
|
%
|
|
|
11.19
|
%
|
|
|
02/2017
|
|
|
|
9,710
|
|
|
|
9,535
|
|
|
|
2.6
|
|
|
|
9,710
|
|
Benetech, Inc.*
|
|
Senior loan
|
|
|
|
L + 5.00
|
%
|
|
|
5.25
|
%
|
|
|
12/2013
|
|
|
|
8,845
|
|
|
|
8,715
|
|
|
|
2.4
|
|
|
|
8,845
|
|
Compass Group Diversified Holdings, LLC*
|
|
Senior loan
|
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
10/2017
|
|
|
|
8,429
|
|
|
|
8,048
|
|
|
|
2.2
|
|
|
|
8,410
|
|
Digital Technology International, LLC
|
|
Senior loan
|
|
|
|
P + 6.00
|
%
|
|
|
9.25
|
%
|
|
|
09/2016
|
|
|
|
309
|
|
|
|
301
|
|
|
|
0.1
|
|
|
|
309
|
|
Digital Technology International, LLC
|
|
Senior loan
|
|
|
|
L + 7.25
|
%
|
|
|
8.75
|
%
|
|
|
09/2016
|
|
|
|
6,373
|
|
|
|
6,264
|
|
|
|
1.7
|
|
|
|
6,373
|
|
Document Technologies, LLC
(3)
|
|
Senior loan
|
|
|
|
P + 4.25
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2016
|
|
|
|
-
|
|
|
|
(16
|
)
|
|
|
-
|
|
|
|
-
|
|
Document Technologies, LLC
|
|
Senior loan
|
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
12/2016
|
|
|
|
4,079
|
|
|
|
4,007
|
|
|
|
1.1
|
|
|
|
4,079
|
|
EAG, Inc.*
|
|
Senior loan
|
|
|
|
P + 3.50
|
%
|
|
|
6.75
|
%
|
|
|
07/2017
|
|
|
|
2,663
|
|
|
|
2,625
|
|
|
|
0.7
|
|
|
|
2,663
|
|
Employment Law Training, Inc. *
|
|
Senior loan
|
|
|
|
L + 7.50
|
%
|
|
|
9.00
|
%
|
|
|
12/2016
|
|
|
|
18,333
|
|
|
|
17,912
|
|
|
|
4.8
|
|
|
|
17,967
|
|
Employment Law Training, Inc.
(3)
|
|
Senior loan
|
|
|
|
L + 7.50
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2016
|
|
|
|
-
|
|
|
|
(23
|
)
|
|
|
-
|
|
|
|
(25
|
)
|
Evolution1, Inc.*
|
|
Senior loan
|
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
06/2016
|
|
|
|
4,631
|
|
|
|
4,576
|
|
|
|
1.2
|
|
|
|
4,631
|
|
Evolution1, Inc.
(3)
|
|
Senior loan
|
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(20
|
)
|
|
|
-
|
|
|
|
-
|
|
Evolution1, Inc.
(3)
|
|
Senior loan
|
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(4
|
)
|
|
|
-
|
|
|
|
-
|
|
HighJump Acquisition LLC
(3)
|
|
Senior loan
|
|
|
|
L + 8.75
|
%
|
|
|
N/A
|
(4)
|
|
|
07/2016
|
|
|
|
-
|
|
|
|
(13
|
)
|
|
|
-
|
|
|
|
-
|
|
HighJump Acquisition LLC
|
|
Senior loan
|
|
|
|
L + 8.75
|
%
|
|
|
10.00
|
%
|
|
|
07/2016
|
|
|
|
5,455
|
|
|
|
5,388
|
|
|
|
1.5
|
|
|
|
5,455
|
|
MSC.Software Corporation*
|
|
Senior loan
|
|
|
|
L + 7.66
|
%
|
|
|
9.16
|
%
|
|
|
12/2016
|
|
|
|
6,319
|
|
|
|
6,206
|
|
|
|
1.7
|
|
|
|
6,319
|
|
NS Holdings, Inc.*
|
|
Senior loan
|
|
|
|
L + 7.91
|
%
|
|
|
9.29
|
%
|
|
|
06/2015
|
|
|
|
260
|
|
|
|
255
|
|
|
|
0.1
|
|
|
|
260
|
|
NS Holdings, Inc.*
|
|
Senior loan
|
|
|
|
L + 6.31
|
%
|
|
|
7.68
|
%
|
|
|
06/2015
|
|
|
|
1,991
|
|
|
|
1,967
|
|
|
|
0.5
|
|
|
|
1,991
|
|
QuadraMed Corporation*
|
|
Senior loan
|
|
|
|
L + 5.25
|
%
|
|
|
6.75
|
%
|
|
|
07/2016
|
|
|
|
3,321
|
|
|
|
3,248
|
|
|
|
0.9
|
|
|
|
3,221
|
|
The Service Companies, Inc.*
|
|
Senior loan
|
|
|
|
L + 6.50
|
%
|
|
|
9.00
|
%
|
|
|
03/2014
|
|
|
|
6,676
|
|
|
|
6,612
|
|
|
|
1.8
|
|
|
|
6,676
|
|
Sumtotal Systems, Inc.*
|
|
Senior loan
|
|
|
|
L + 4.00
|
%
|
|
|
5.25
|
%
|
|
|
12/2015
|
|
|
|
1,434
|
|
|
|
1,421
|
|
|
|
0.4
|
|
|
|
1,434
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
88,828
|
|
|
|
87,004
|
|
|
|
23.7
|
|
|
|
88,318
|
|
Diversified Natural Resources,
Precious
Metals, and Minerals
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metal Spinners, Inc.*
|
|
Senior loan
|
|
|
|
L + 6.50
|
%
|
|
|
8.00
|
%
|
|
|
12/2014
|
|
|
|
1,640
|
|
|
|
1,595
|
|
|
|
0.4
|
|
|
|
1,640
|
|
Metal Spinners, Inc.*
|
|
Senior loan
|
|
|
|
L + 6.50
|
%
|
|
|
8.00
|
%
|
|
|
12/2014
|
|
|
|
3,013
|
|
|
|
2,934
|
|
|
|
0.8
|
|
|
|
3,013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,653
|
|
|
|
4,529
|
|
|
|
1.2
|
|
|
|
4,653
|
|
Electronics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Blue Coat Systems, Inc.*
|
|
Second lien
|
|
|
|
L + 10.00
|
%
|
|
|
11.50
|
%
|
|
|
08/2018
|
|
|
|
5,424
|
|
|
|
5,270
|
|
|
|
1.5
|
|
|
|
5,458
|
|
Blue Coat Systems, Inc.
|
|
Senior loan
|
|
|
|
L + 6.00
|
%
|
|
|
7.50
|
%
|
|
|
02/2018
|
|
|
|
8,136
|
|
|
|
7,983
|
|
|
|
2.2
|
|
|
|
8,131
|
|
Cape Electrical Supply LLC*
(6)
|
|
Senior loan
|
|
|
|
L + 6.25
|
%
|
|
|
7.50
|
%
|
|
|
11/2013
|
|
|
|
1,598
|
|
|
|
1,560
|
|
|
|
0.4
|
|
|
|
1,598
|
|
Ecommerce Industries, Inc.*
|
|
Senior loan
|
|
|
|
L + 8.34
|
%
|
|
|
9.59
|
%
|
|
|
10/2016
|
|
|
|
13,708
|
|
|
|
13,491
|
|
|
|
3.7
|
|
|
|
13,708
|
|
Ecommerce Industries, Inc.
(3)
|
|
Senior loan
|
|
|
|
L + 6.75
|
%
|
|
|
N/A
|
(4)
|
|
|
10/2016
|
|
|
|
-
|
|
|
|
(29
|
)
|
|
|
-
|
|
|
|
-
|
|
Entrust, Inc.*
|
|
Senior loan
|
|
|
|
L + 7.28
|
%
|
|
|
8.81
|
%
|
|
|
03/2017
|
|
|
|
4,163
|
|
|
|
4,112
|
|
|
|
1.1
|
|
|
|
4,163
|
|
Entrust, Inc.*
|
|
Senior loan
|
|
|
|
L + 7.29
|
%
|
|
|
8.82
|
%
|
|
|
03/2017
|
|
|
|
8,263
|
|
|
|
8,147
|
|
|
|
2.2
|
|
|
|
8,263
|
|
Rogue Wave Holdings, Inc.*
|
|
Senior loan
|
|
|
|
L + 10.00
|
%
|
|
|
11.25
|
%
|
|
|
08/2016
|
|
|
|
4,071
|
|
|
|
4,031
|
|
|
|
1.1
|
|
|
|
4,030
|
|
Syncsort Incorporated*
|
|
Senior loan
|
|
|
|
L + 5.50
|
%
|
|
|
7.50
|
%
|
|
|
03/2015
|
|
|
|
8,145
|
|
|
|
8,020
|
|
|
|
2.2
|
|
|
|
8,145
|
|
Syncsort Incorporated
(3)
|
|
Senior loan
|
|
|
|
L + 5.50
|
%
|
|
|
N/A
|
(4)
|
|
|
03/2015
|
|
|
|
-
|
|
|
|
(5
|
)
|
|
|
-
|
|
|
|
-
|
|
Time-O-Matic, Inc.
(6)
|
|
Subordinated debt
|
|
|
|
N/A
|
|
|
|
13.25
|
%
|
|
|
12/2016
|
|
|
|
11,524
|
|
|
|
11,339
|
|
|
|
3.1
|
|
|
|
11,524
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
65,032
|
|
|
|
63,919
|
|
|
|
17.5
|
|
|
|
65,020
|
|
Farming and Agriculture
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AGData, L.P.
|
|
Senior loan
|
|
|
|
L + 6.25
|
%
|
|
|
7.75
|
%
|
|
|
08/2016
|
|
|
|
2,853
|
|
|
|
2,819
|
|
|
|
0.8
|
|
|
|
2,853
|
|
Finance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonddesk Group LLC*
|
|
Senior loan
|
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
09/2016
|
|
|
|
1,013
|
|
|
|
1,004
|
|
|
|
0.3
|
|
|
|
1,013
|
|
Pillar Processing LLC*
(5)
|
|
Senior loan
|
|
|
|
P + 4.25
|
%
|
|
|
7.50
|
%
|
|
|
11/2013
|
|
|
|
2,972
|
|
|
|
2,966
|
|
|
|
0.6
|
|
|
|
2,080
|
|
Pillar Processing LLC*
(5)
|
|
Senior loan
|
|
|
|
N/A
|
|
|
|
14.50
|
%
|
|
|
05/2014
|
|
|
|
3,125
|
|
|
|
3,125
|
|
|
|
0.1
|
|
|
|
313
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,110
|
|
|
|
7,095
|
|
|
|
1.0
|
|
|
|
3,406
|
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments (unaudited) - (Continued)
June 30, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
|
|
Investment
|
|
Spread Above
|
|
|
Interest
|
|
|
Maturity
|
|
|
Principal
|
|
|
|
|
|
of Total
|
|
|
Fair
|
|
|
|
Type
|
|
Index
(1)
|
|
|
Rate
(2)
|
|
|
Date
|
|
|
Amount
|
|
|
Cost
|
|
|
Net Assets
|
|
|
Value
|
|
Healthcare, Education and Childcare
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advanced Pain Management Holdings, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
06/2016
|
|
|
$
|
7,918
|
|
|
$
|
7,779
|
|
|
|
2.1
|
%
|
|
$
|
7,918
|
|
Avatar International, LLC*
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
8.75
|
%
|
|
|
09/2016
|
|
|
|
7,905
|
|
|
|
7,789
|
|
|
|
2.1
|
|
|
|
7,905
|
|
Avatar International, LLC
(3)
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
N/A
|
(4)
|
|
|
09/2016
|
|
|
|
-
|
|
|
|
(8
|
)
|
|
|
-
|
|
|
|
-
|
|
Avatar International, LLC
|
|
Senior loan
|
|
|
L + 8.00
|
%
|
|
|
9.26
|
%
|
|
|
09/2016
|
|
|
|
1,705
|
|
|
|
1,687
|
|
|
|
0.5
|
|
|
|
1,705
|
|
Campus Management Acquisition Corp.
|
|
Second lien
|
|
|
L + 10.52
|
%
|
|
|
12.27
|
%
|
|
|
09/2015
|
|
|
|
5,221
|
|
|
|
5,153
|
|
|
|
1.3
|
|
|
|
4,803
|
|
CHS/Community Health Systems
|
|
Senior loan
|
|
|
L + 2.25
|
%
|
|
|
2.58
|
%
|
|
|
07/2014
|
|
|
|
5,085
|
|
|
|
5,061
|
|
|
|
1.3
|
|
|
|
5,023
|
|
Community Hospices of America, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.25
|
%
|
|
|
12/2015
|
|
|
|
5,023
|
|
|
|
4,954
|
|
|
|
1.3
|
|
|
|
5,023
|
|
Community Hospices of America, Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(5
|
)
|
|
|
-
|
|
|
|
-
|
|
Community Hospices of America, Inc.
(6)
|
|
Subordinated debt
|
|
|
L + 11.75
|
%
|
|
|
13.75
|
%
|
|
|
06/2016
|
|
|
|
1,861
|
|
|
|
1,829
|
|
|
|
0.5
|
|
|
|
1,861
|
|
DDC Center Inc.*
|
|
Senior loan
|
|
|
L + 6.50
|
%
|
|
|
9.50
|
%
|
|
|
10/2014
|
|
|
|
8,276
|
|
|
|
8,280
|
|
|
|
2.2
|
|
|
|
8,276
|
|
DDC Center Inc.*
|
|
Senior loan
|
|
|
L + 6.50
|
%
|
|
|
9.50
|
%
|
|
|
12/2012
|
|
|
|
227
|
|
|
|
227
|
|
|
|
0.1
|
|
|
|
227
|
|
DDC Center Inc.
|
|
Senior loan
|
|
|
P + 5.25
|
%
|
|
|
10.75
|
%
|
|
|
10/2013
|
|
|
|
91
|
|
|
|
91
|
|
|
|
-
|
|
|
|
91
|
|
Delta Educational Systems, Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
7.00
|
%
|
|
|
11/2012
|
|
|
|
2,784
|
|
|
|
2,767
|
|
|
|
0.7
|
|
|
|
2,784
|
|
Dialysis Newco, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
13.00
|
%
|
|
|
09/2018
|
|
|
|
8,752
|
|
|
|
8,627
|
|
|
|
2.3
|
|
|
|
8,620
|
|
G & H Wire Company, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.25
|
%
|
|
|
12/2015
|
|
|
|
5,550
|
|
|
|
5,483
|
|
|
|
1.5
|
|
|
|
5,550
|
|
G & H Wire Company, Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(9
|
)
|
|
|
-
|
|
|
|
-
|
|
Hospitalists Management Group, LLC
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
6.00
|
%
|
|
|
05/2017
|
|
|
|
415
|
|
|
|
404
|
|
|
|
0.1
|
|
|
|
397
|
|
Hospitalists Management Group, LLC
|
|
Senior loan
|
|
|
P + 3.50
|
%
|
|
|
6.75
|
%
|
|
|
05/2017
|
|
|
|
3,996
|
|
|
|
3,915
|
|
|
|
1.0
|
|
|
|
3,916
|
|
Hospitalists Management Group, LLC
(3)
|
|
Senior loan
|
|
|
P + 3.50
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2017
|
|
|
|
-
|
|
|
|
(11
|
)
|
|
|
-
|
|
|
|
(18
|
)
|
The Hygenic Corporation*
|
|
Senior loan
|
|
|
L + 2.50
|
%
|
|
|
2.74
|
%
|
|
|
04/2013
|
|
|
|
2,224
|
|
|
|
2,207
|
|
|
|
0.6
|
|
|
|
2,202
|
|
Integrated DNA Technologies, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
04/2015
|
|
|
|
450
|
|
|
|
436
|
|
|
|
0.1
|
|
|
|
450
|
|
Integrated DNA Technologies, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
04/2015
|
|
|
|
450
|
|
|
|
446
|
|
|
|
0.1
|
|
|
|
450
|
|
Integrated DNA Technologies, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
04/2015
|
|
|
|
3,800
|
|
|
|
3,763
|
|
|
|
1.0
|
|
|
|
3,800
|
|
Maverick Healthcare Group, LLC *
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.25
|
%
|
|
|
12/2016
|
|
|
|
2,177
|
|
|
|
2,150
|
|
|
|
0.6
|
|
|
|
2,177
|
|
National Healing Corporation*
|
|
Second lien
|
|
|
L + 10.00
|
%
|
|
|
11.50
|
%
|
|
|
11/2018
|
|
|
|
17,976
|
|
|
|
16,926
|
|
|
|
4.8
|
|
|
|
17,976
|
|
National Healing Corporation
|
|
Senior loan
|
|
|
L + 6.75
|
%
|
|
|
8.25
|
%
|
|
|
11/2017
|
|
|
|
3,578
|
|
|
|
3,416
|
|
|
|
1.0
|
|
|
|
3,578
|
|
NeuroTherm, Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
02/2016
|
|
|
|
1,623
|
|
|
|
1,596
|
|
|
|
0.4
|
|
|
|
1,623
|
|
NeuroTherm, Inc.
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
02/2016
|
|
|
|
115
|
|
|
|
109
|
|
|
|
-
|
|
|
|
115
|
|
Pentec Acquisition Sub, Inc.*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.50
|
%
|
|
|
05/2018
|
|
|
|
2,271
|
|
|
|
2,226
|
|
|
|
0.6
|
|
|
|
2,226
|
|
Pentec Acquisition Sub, Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2017
|
|
|
|
-
|
|
|
|
(4
|
)
|
|
|
-
|
|
|
|
(4
|
)
|
PhysioTherapy Associates Holdings, Inc.*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.00
|
%
|
|
|
04/2018
|
|
|
|
578
|
|
|
|
567
|
|
|
|
0.2
|
|
|
|
576
|
|
Reliant Pro ReHab, LLC*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.00
|
%
|
|
|
06/2016
|
|
|
|
3,649
|
|
|
|
3,598
|
|
|
|
1.0
|
|
|
|
3,649
|
|
Reliant Pro ReHab, LLC
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(18
|
)
|
|
|
-
|
|
|
|
-
|
|
Reliant Pro ReHab, LLC
|
|
Senior loan
|
|
|
P + 3.75
|
%
|
|
|
7.00
|
%
|
|
|
06/2016
|
|
|
|
372
|
|
|
|
364
|
|
|
|
0.1
|
|
|
|
372
|
|
Renaissance Pharma (U.S.) Holdings Inc.
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
7.50
|
%
|
|
|
06/2017
|
|
|
|
82
|
|
|
|
76
|
|
|
|
-
|
|
|
|
76
|
|
Renaissance Pharma (U.S.) Holdings Inc.
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
7.50
|
%
|
|
|
06/2017
|
|
|
|
1,369
|
|
|
|
1,342
|
|
|
|
0.4
|
|
|
|
1,342
|
|
Surgical Information Systems, LLC
|
|
Second lien
|
|
|
L + 7.39
|
%
|
|
|
8.89
|
%
|
|
|
12/2015
|
|
|
|
4,291
|
|
|
|
4,231
|
|
|
|
1.1
|
|
|
|
4,291
|
|
TIDI Products, LLC*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.27
|
%
|
|
|
05/2015
|
|
|
|
2,053
|
|
|
|
2,025
|
|
|
|
0.5
|
|
|
|
2,053
|
|
TIDI Products, LLC
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2015
|
|
|
|
-
|
|
|
|
(4
|
)
|
|
|
-
|
|
|
|
-
|
|
WIL Research Company, Inc.*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.75
|
%
|
|
|
04/2018
|
|
|
|
794
|
|
|
|
782
|
|
|
|
0.2
|
|
|
|
790
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
112,661
|
|
|
|
110,247
|
|
|
|
29.7
|
|
|
|
111,823
|
|
Home and Office Furnishings,
Housewares, and Durable Consumer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Top Knobs USA, Inc.*
|
|
Senior loan
|
|
|
L + 5.79
|
%
|
|
|
7.75
|
%
|
|
|
11/2016
|
|
|
|
1,111
|
|
|
|
1,095
|
|
|
|
0.3
|
|
|
|
1,111
|
|
WII Components, Inc.*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
07/2016
|
|
|
|
1,755
|
|
|
|
1,734
|
|
|
|
0.5
|
|
|
|
1,755
|
|
WII Components, Inc.
|
|
Senior loan
|
|
|
P + 3.75
|
%
|
|
|
7.00
|
%
|
|
|
07/2016
|
|
|
|
41
|
|
|
|
40
|
|
|
|
-
|
|
|
|
41
|
|
Zenith Products Corporation*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
5.61
|
%
|
|
|
09/2013
|
|
|
|
3,449
|
|
|
|
3,423
|
|
|
|
0.9
|
|
|
|
3,346
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,356
|
|
|
|
6,292
|
|
|
|
1.7
|
|
|
|
6,253
|
|
Leisure, Amusement, Motion Pictures and Entertainment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Competitor Group, Inc.*
|
|
Senior loan
|
|
|
L + 8.00
|
%
|
|
|
9.50
|
%
|
|
|
01/2017
|
|
|
|
18,179
|
|
|
|
17,875
|
|
|
|
4.9
|
|
|
|
18,179
|
|
Competitor Group, Inc.
(3)
|
|
Senior loan
|
|
|
L + 8.00
|
%
|
|
|
N/A
|
(4)
|
|
|
01/2017
|
|
|
|
-
|
|
|
|
(9
|
)
|
|
|
-
|
|
|
|
-
|
|
Cortz, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.00
|
%
|
|
|
03/2014
|
|
|
|
6,781
|
|
|
|
6,723
|
|
|
|
1.8
|
|
|
|
6,781
|
|
Octane Fitness, LLC*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.00
|
%
|
|
|
12/2015
|
|
|
|
4,675
|
|
|
|
4,543
|
|
|
|
1.2
|
|
|
|
4,675
|
|
Pride Manufacturing Company, LLC*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.25
|
%
|
|
|
11/2015
|
|
|
|
737
|
|
|
|
727
|
|
|
|
0.2
|
|
|
|
723
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,372
|
|
|
|
29,859
|
|
|
|
8.1
|
|
|
|
30,358
|
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments (unaudited) - (Continued)
June 30, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
|
|
Investment
|
|
Spread Above
|
|
|
Interest
|
|
|
Maturity
|
|
|
Principal
|
|
|
|
|
|
of Total
|
|
|
Fair
|
|
|
|
Type
|
|
Index
(1)
|
|
|
Rate
(2)
|
|
|
Date
|
|
|
Amount
|
|
|
Cost
|
|
|
Net Assets
|
|
|
Value
|
|
Personal and Non-Durable Consumer Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dr. Miracles, Inc.*
(6)
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
10.00
|
%
|
|
|
03/2014
|
|
|
$
|
3,077
|
|
|
$
|
3,059
|
|
|
|
0.8
|
%
|
|
$
|
2,892
|
|
Massage Envy, LLC*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
06/2016
|
|
|
|
6,516
|
|
|
|
6,452
|
|
|
|
1.7
|
|
|
|
6,516
|
|
Massage Envy, LLC
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
06/2016
|
|
|
|
104
|
|
|
|
103
|
|
|
|
-
|
|
|
|
104
|
|
Strategic Partners, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
02/2017
|
|
|
|
9,636
|
|
|
|
9,449
|
|
|
|
2.7
|
|
|
|
9,925
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,333
|
|
|
|
19,063
|
|
|
|
5.2
|
|
|
|
19,437
|
|
Personal, Food and Miscellaneous Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Affordable Care Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.51
|
%
|
|
|
12/2015
|
|
|
|
3,659
|
|
|
|
3,619
|
|
|
|
1.0
|
|
|
|
3,659
|
|
Affordable Care Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(7
|
)
|
|
|
-
|
|
|
|
-
|
|
Automatic Bar Controls, Inc.*
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
7.51
|
%
|
|
|
03/2016
|
|
|
|
1,013
|
|
|
|
1,002
|
|
|
|
0.3
|
|
|
|
962
|
|
Automatic Bar Controls, Inc.
(3)
|
|
Senior loan
|
|
|
P + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
03/2016
|
|
|
|
-
|
|
|
|
(2
|
)
|
|
|
-
|
|
|
|
(8
|
)
|
Focus Brands Inc.
|
|
Second lien
|
|
|
L + 9.00
|
%
|
|
|
10.25
|
%
|
|
|
08/2018
|
|
|
|
6,481
|
|
|
|
6,358
|
|
|
|
1.7
|
|
|
|
6,530
|
|
Focus Brands Inc.
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.27
|
%
|
|
|
02/2018
|
|
|
|
6,196
|
|
|
|
6,137
|
|
|
|
1.7
|
|
|
|
6,223
|
|
Ignite Restaurant Group, Inc.*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
03/2016
|
|
|
|
4,170
|
|
|
|
4,096
|
|
|
|
1.1
|
|
|
|
4,170
|
|
NVA Acquisition Company
|
|
Senior loan
|
|
|
L + 4.25
|
%
|
|
|
5.50
|
%
|
|
|
06/2016
|
|
|
|
1,886
|
|
|
|
1,871
|
|
|
|
0.5
|
|
|
|
1,848
|
|
PMI Holdings, Inc.
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.25
|
%
|
|
|
06/2017
|
|
|
|
2,740
|
|
|
|
2,713
|
|
|
|
0.7
|
|
|
|
2,713
|
|
PMI Holdings, Inc.
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
7.50
|
%
|
|
|
06/2017
|
|
|
|
16
|
|
|
|
12
|
|
|
|
-
|
|
|
|
12
|
|
Restaurant Technologies, Inc.*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.00
|
%
|
|
|
05/2017
|
|
|
|
1,080
|
|
|
|
1,071
|
|
|
|
0.3
|
|
|
|
1,058
|
|
Restaurant Technologies, Inc.
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.00
|
%
|
|
|
05/2017
|
|
|
|
117
|
|
|
|
116
|
|
|
|
-
|
|
|
|
114
|
|
Trusthouse Service Group, Inc.
(3)
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2018
|
|
|
|
-
|
|
|
|
(4
|
)
|
|
|
-
|
|
|
|
(4
|
)
|
Trusthouse Service Group, Inc.
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
7.50
|
%
|
|
|
06/2017
|
|
|
|
24
|
|
|
|
19
|
|
|
|
-
|
|
|
|
19
|
|
Trusthouse Service Group, Inc.
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.75
|
%
|
|
|
06/2018
|
|
|
|
2,983
|
|
|
|
2,931
|
|
|
|
0.8
|
|
|
|
2,924
|
|
Vetcor Professional Practices LLC*
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
7.50
|
%
|
|
|
02/2015
|
|
|
|
9,773
|
|
|
|
9,773
|
|
|
|
2.6
|
|
|
|
9,773
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,138
|
|
|
|
39,705
|
|
|
|
10.7
|
|
|
|
39,993
|
|
Personal Transportation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PODS Funding Corp. II*
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
8.50
|
%
|
|
|
11/2016
|
|
|
|
6,080
|
|
|
|
5,919
|
|
|
|
1.6
|
|
|
|
6,080
|
|
PODS Funding Corp. II
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
21.00
|
%
|
|
|
11/2017
|
|
|
|
2,802
|
|
|
|
2,802
|
|
|
|
0.7
|
|
|
|
2,802
|
|
PODS Funding Corp. II
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
21.00
|
%
|
|
|
11/2017
|
|
|
|
579
|
|
|
|
579
|
|
|
|
0.2
|
|
|
|
579
|
|
PODS Funding Corp. II
(6)
|
|
Second lien
|
|
|
N/A
|
|
|
|
15.50
|
%
|
|
|
05/2017
|
|
|
|
444
|
|
|
|
438
|
|
|
|
0.1
|
|
|
|
444
|
|
PODS Funding Corp. II
(6)
|
|
Second lien
|
|
|
N/A
|
|
|
|
15.50
|
%
|
|
|
05/2017
|
|
|
|
2,081
|
|
|
|
2,027
|
|
|
|
0.6
|
|
|
|
2,081
|
|
PODS Funding Corp. II
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
8.50
|
%
|
|
|
11/2016
|
|
|
|
788
|
|
|
|
768
|
|
|
|
0.2
|
|
|
|
788
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,774
|
|
|
|
12,533
|
|
|
|
3.4
|
|
|
|
12,774
|
|
Printing and Publishing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market Track, LLC*
|
|
Senior loan
|
|
|
L + 7.75
|
%
|
|
|
9.25
|
%
|
|
|
11/2015
|
|
|
|
12,160
|
|
|
|
11,999
|
|
|
|
3.2
|
|
|
|
12,160
|
|
Market Track, LLC
(3)
|
|
Senior loan
|
|
|
L + 7.75
|
%
|
|
|
N/A
|
(4)
|
|
|
11/2015
|
|
|
|
-
|
|
|
|
(16
|
)
|
|
|
-
|
|
|
|
-
|
|
Trade Service Company, LLC*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.75
|
%
|
|
|
06/2013
|
|
|
|
1,113
|
|
|
|
1,111
|
|
|
|
0.3
|
|
|
|
1,113
|
|
Trade Service Company, LLC*
(6)
|
|
Senior loan
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
06/2013
|
|
|
|
765
|
|
|
|
764
|
|
|
|
0.2
|
|
|
|
765
|
|
Trade Service Company, LLC
(3)
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2013
|
|
|
|
-
|
|
|
|
(1
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,038
|
|
|
|
13,857
|
|
|
|
3.7
|
|
|
|
14,038
|
|
Retail Stores
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barcelona Restaurants, LLC*
|
|
Senior loan
|
|
|
L + 10.00
|
%
|
|
|
11.50
|
%
|
|
|
03/2017
|
|
|
|
4,976
|
|
|
|
4,885
|
|
|
|
1.3
|
|
|
|
4,976
|
|
Barcelona Restaurants, LLC
(3)
|
|
Senior loan
|
|
|
L + 10.00
|
%
|
|
|
N/A
|
(4)
|
|
|
03/2017
|
|
|
|
-
|
|
|
|
(6
|
)
|
|
|
-
|
|
|
|
-
|
|
Bojangles' Restaurants, Inc.*
|
|
Senior loan
|
|
|
L + 6.50
|
%
|
|
|
8.00
|
%
|
|
|
08/2017
|
|
|
|
2,872
|
|
|
|
2,693
|
|
|
|
0.8
|
|
|
|
2,876
|
|
Chuy's OPCO, Inc.
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
8.50
|
%
|
|
|
05/2016
|
|
|
|
158
|
|
|
|
155
|
|
|
|
-
|
|
|
|
158
|
|
Chuy's OPCO, Inc.
|
|
Senior loan
|
|
|
L + 7.83
|
%
|
|
|
9.33
|
%
|
|
|
05/2016
|
|
|
|
997
|
|
|
|
980
|
|
|
|
0.3
|
|
|
|
997
|
|
Chuy's OPCO, Inc.
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
8.50
|
%
|
|
|
05/2016
|
|
|
|
15,112
|
|
|
|
14,888
|
|
|
|
4.0
|
|
|
|
15,112
|
|
DTLR, Inc.*
|
|
Senior loan
|
|
|
L + 8.00
|
%
|
|
|
11.00
|
%
|
|
|
12/2015
|
|
|
|
8,009
|
|
|
|
7,902
|
|
|
|
2.1
|
|
|
|
8,009
|
|
The Marshall Retail Group, LLC*
|
|
Senior loan
|
|
|
L + 6.50
|
%
|
|
|
8.00
|
%
|
|
|
04/2013
|
|
|
|
10,549
|
|
|
|
10,360
|
|
|
|
2.8
|
|
|
|
10,549
|
|
The Marshall Retail Group, LLC
(3)
|
|
Senior loan
|
|
|
L + 6.50
|
%
|
|
|
N/A
|
(4)
|
|
|
04/2013
|
|
|
|
-
|
|
|
|
(16
|
)
|
|
|
-
|
|
|
|
-
|
|
Michaels Stores, Inc.
|
|
Senior loan
|
|
|
L + 2.25
|
%
|
|
|
2.75
|
%
|
|
|
10/2013
|
|
|
|
5,000
|
|
|
|
5,006
|
|
|
|
1.3
|
|
|
|
4,992
|
|
Restaurant Holding Company, LLC
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
9.03
|
%
|
|
|
02/2017
|
|
|
|
9,978
|
|
|
|
9,793
|
|
|
|
2.7
|
|
|
|
10,028
|
|
Rubio's Restaurants, Inc.*
(6)
|
|
Senior loan
|
|
|
L + 7.75
|
%
|
|
|
9.50
|
%
|
|
|
06/2015
|
|
|
|
8,353
|
|
|
|
8,245
|
|
|
|
2.2
|
|
|
|
8,353
|
|
Vision Source L.P.*
|
|
Senior loan
|
|
|
L + 6.75
|
%
|
|
|
8.00
|
%
|
|
|
04/2016
|
|
|
|
13,286
|
|
|
|
13,077
|
|
|
|
3.6
|
|
|
|
13,286
|
|
Vision Source L.P.
(3)
|
|
Senior loan
|
|
|
L + 6.75
|
%
|
|
|
N/A
|
(4)
|
|
|
04/2016
|
|
|
|
-
|
|
|
|
(9
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
79,290
|
|
|
|
77,953
|
|
|
|
21.1
|
|
|
|
79,336
|
|
Telecommunications
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hosting.com, Inc.*
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
5.75
|
%
|
|
|
05/2014
|
|
|
|
848
|
|
|
|
838
|
|
|
|
0.2
|
|
|
|
848
|
|
Hosting.com, Inc.
(3)
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2014
|
|
|
|
-
|
|
|
|
(2
|
)
|
|
|
-
|
|
|
|
-
|
|
NameMedia, Inc.
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
7.50
|
%
|
|
|
11/2014
|
|
|
|
9
|
|
|
|
9
|
|
|
|
-
|
|
|
|
9
|
|
NameMedia, Inc.
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
7.50
|
%
|
|
|
11/2014
|
|
|
|
2,224
|
|
|
|
2,192
|
|
|
|
0.6
|
|
|
|
2,224
|
|
West Corporation
(3)
|
|
Senior loan
|
|
|
L + 2.00
|
%
|
|
|
N/A
|
(4)
|
|
|
10/2012
|
|
|
|
-
|
|
|
|
(37
|
)
|
|
|
(0.1
|
)
|
|
|
(200
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,081
|
|
|
|
3,000
|
|
|
|
0.7
|
|
|
|
2,881
|
|
Utilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PowerPlan Consultants, Inc.*
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
7.50
|
%
|
|
|
05/2014
|
|
|
|
5,176
|
|
|
|
5,103
|
|
|
|
1.4
|
|
|
|
5,176
|
|
PowerPlan Consultants, Inc.
(3)
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2015
|
|
|
|
-
|
|
|
|
(2
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,176
|
|
|
|
5,101
|
|
|
|
1.4
|
|
|
|
5,176
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total debt investments
United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
624,500
|
|
|
$
|
613,712
|
|
|
|
164.8
|
%
|
|
$
|
616,816
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value as a percentage of Principal Amount
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
98.8
|
%
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments (unaudited) - (Continued)
June 30, 2012
(In thousands, except derivative contracts)
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
|
Percentage
|
|
|
|
|
|
|
Investment
|
|
Spread Above
|
|
|
Interest
|
|
|
Maturity
|
|
|
Amount/Shares/
|
|
|
|
|
|
of Total
|
|
|
Fair
|
|
|
|
Type
|
|
Index
(1)
|
|
|
Rate
(2)
|
|
|
Date
|
|
|
Contracts
|
|
|
Cost
|
|
|
Net Assets
|
|
|
Value
|
|
Equity investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aerospace and Defense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Whitcraft LLC
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
1
|
|
|
$
|
670
|
|
|
|
0.2
|
%
|
|
$
|
670
|
|
Whitcraft LLC
|
|
Warrant
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
117
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
670
|
|
|
|
0.2
|
|
|
|
787
|
|
Automobile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ABRA, Inc.
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
1
|
|
|
|
1,471
|
|
|
|
0.4
|
|
|
|
1,471
|
|
K&N Engineering, Inc.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
4
|
|
|
|
-
|
|
|
|
4
|
|
K&N Engineering, Inc.
|
|
Preferred stock A
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
62
|
|
|
|
-
|
|
|
|
62
|
|
K&N Engineering, Inc.
|
|
Preferred stock B
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
18
|
|
|
|
-
|
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,555
|
|
|
|
0.4
|
|
|
|
1,555
|
|
Banking
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prommis Solutions Inc.*
|
|
Preferred LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
6
|
|
|
|
472
|
|
|
|
-
|
|
|
|
-
|
|
Prommis Solutions Inc.*
|
|
A-1 LLC interset
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Prommis Solutions Inc.*
|
|
A-2 LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
472
|
|
|
|
-
|
|
|
|
-
|
|
Beverage, Food and Tobacco
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Atkins Nutrionals, Inc.
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
57
|
|
|
|
796
|
|
|
|
0.3
|
|
|
|
1,064
|
|
First Watch Restaurants, Inc.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
7
|
|
|
|
691
|
|
|
|
0.2
|
|
|
|
691
|
|
Julio & Sons Company
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
521
|
|
|
|
521
|
|
|
|
0.2
|
|
|
|
619
|
|
Richelieu Foods, Inc.
|
|
LP interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
220
|
|
|
|
220
|
|
|
|
0.1
|
|
|
|
189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,228
|
|
|
|
0.8
|
|
|
|
2,563
|
|
Diversified Conglomerate
Manufacturing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oasis Outsourcing Holdings, Inc.
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
1,088
|
|
|
|
1,088
|
|
|
|
0.4
|
|
|
|
1,337
|
|
Sunless Merger Sub, Inc.
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
148
|
|
|
|
-
|
|
|
|
148
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,236
|
|
|
|
0.4
|
|
|
|
1,485
|
|
Diversified Conglomerate Service
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Document Technologies, LLC
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
24
|
|
|
|
490
|
|
|
|
0.1
|
|
|
|
490
|
|
Employment Law Training, Inc.
|
|
LP interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
666
|
|
|
|
666
|
|
|
|
0.2
|
|
|
|
666
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,156
|
|
|
|
0.3
|
|
|
|
1,156
|
|
Healthcare, Education
and Childcare
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advanced Pain Management Holdings, Inc.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
67
|
|
|
|
67
|
|
|
|
-
|
|
|
|
63
|
|
Advanced Pain Management Holdings, Inc.
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
13
|
|
|
|
1,273
|
|
|
|
0.3
|
|
|
|
1,188
|
|
Avatar International, LLC
|
|
LP interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
7
|
|
|
|
695
|
|
|
|
0.2
|
|
|
|
695
|
|
Dialysis Newco, Inc.
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
871
|
|
|
|
871
|
|
|
|
0.2
|
|
|
|
871
|
|
G & H Wire Company, Inc.
|
|
LP interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
102
|
|
|
|
-
|
|
|
|
102
|
|
Hospitalists Management Group, LLC
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
38
|
|
|
|
-
|
|
|
|
38
|
|
National Healing Corporation
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
695
|
|
|
|
799
|
|
|
|
0.3
|
|
|
|
1,020
|
|
NeuroTherm, Inc.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
1
|
|
|
|
569
|
|
|
|
0.2
|
|
|
|
569
|
|
Pentec Holdings, Inc.
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
1
|
|
|
|
116
|
|
|
|
-
|
|
|
|
116
|
|
Reliant Pro ReHab, LLC
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
2
|
|
|
|
264
|
|
|
|
0.1
|
|
|
|
263
|
|
Surgical Information Systems, LLC
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
4
|
|
|
|
414
|
|
|
|
0.1
|
|
|
|
414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,208
|
|
|
|
1.4
|
|
|
|
5,339
|
|
Home and Office Furnishings,
Housewares, and Durable Consumer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Top Knobs USA, Inc.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
3
|
|
|
|
73
|
|
|
|
-
|
|
|
|
73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Leisure, Amusement, Motion
Pictures and Entertainment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Competitor Group, Inc.
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
199
|
|
|
|
88
|
|
|
|
0.1
|
|
|
|
193
|
|
Competitor Group, Inc.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
9
|
|
|
|
87
|
|
|
|
-
|
|
|
|
107
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
175
|
|
|
|
0.1
|
|
|
|
300
|
|
Personal and Non-Durable
Consumer Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic Partners, Inc.
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
169
|
|
|
|
1,691
|
|
|
|
0.3
|
|
|
|
1,203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Personal Transportation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PODS Funding Corp. II
|
|
Warrant
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
224
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail Stores
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barcelona Restaurants, LLC
|
|
LP interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
1,996
|
|
|
|
1,996
|
|
|
|
0.5
|
|
|
|
1,996
|
|
Rubio's Restaurants, Inc.
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
199
|
|
|
|
945
|
|
|
|
0.2
|
|
|
|
599
|
|
Vision Source L.P.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
9
|
|
|
|
936
|
|
|
|
0.3
|
|
|
|
936
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,877
|
|
|
|
1.0
|
|
|
|
3,531
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
equity investments United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
18,341
|
|
|
|
4.8
|
%
|
|
$
|
17,992
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
632,053
|
|
|
|
169.6
|
%
|
|
$
|
634,808
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
635,252
|
|
|
|
170.1
|
%
|
|
$
|
636,632
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative investments
(7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Futures contracts
sold (Note 7)
|
|
Futures contracts
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
09/2012
|
|
|
|
243
|
|
|
$
|
-
|
|
|
|
-
|
%
|
|
$
|
75
|
|
* Denotes that all or a portion
of the loan secures the notes offered in the Debt Securitization (as defined in Note 6).
|
(1)
|
The majority of the investments bear interest at a rate that may be determined by reference to London Interbank Offered Rate
("LIBOR") "L" or Prime "P" and which reset daily, quarterly or semiannually. For each we
have
provided the spread over LIBOR or Prime and the weighted average current interest rate in effect at June 30, 2012. Certain investments
are subject to a LIBOR or Prime interest rate floor. For fixed rate loans, a spread above a reference rate is not applicable.
|
|
(2)
|
For portfolio companies with multiple interest rate contracts, the interest rate shown is a weighted average current interest
rate in effect at June 30, 2012.
|
|
(3)
|
The negative fair value is the result of the capitalized discount on the loan or the unfunded commitment being valued below
par. The negative cost is the result of the capitalized discount being greater than the
principal amount outstanding
on the loan.
|
|
(4)
|
The entire commitment was unfunded at June 30, 2012. As such, no interest is being earned on this investment.
|
|
(5)
|
Loan was on non-accrual status as of June 30, 2012, meaning that the Company has ceased recognizing interest income on the
loan.
|
|
(6)
|
A portion of the interest may be deferred through a payment-in-kind ("PIK") rate option.
|
|
(7)
|
As of June 30, 2012, the Company also had a $74 receivable from a total return swap ("TRS"), which was terminated
on April 11, 2012.
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments
September 30, 2011
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
|
|
Investment
|
|
Spread Above
|
|
|
Interest
|
|
|
Maturity
|
|
|
Principal
|
|
|
|
|
|
of
|
|
|
Fair
|
|
|
|
Type
|
|
Index
(1)
|
|
|
Rate
(2)
|
|
|
Date
|
|
|
Amount
|
|
|
Cost
|
|
|
Net Assets
|
|
|
Value
|
|
Investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Canada
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Leisure, Amusement, Motion Pictures,
Entertainment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Extreme Fitness, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.50
|
%
|
|
|
11/2015
|
|
|
$
|
2,799
|
|
|
$
|
2,748
|
|
|
|
0.8
|
%
|
|
$
|
2,799
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Canada
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
2,799
|
|
|
$
|
2,748
|
|
|
|
0.8
|
%
|
|
$
|
2,799
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value as percentage of Principal Amount
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aerospace and Defense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Whitcraft LLC
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
12.00
|
%
|
|
|
12/2018
|
|
|
$
|
1,877
|
|
|
$
|
1,843
|
|
|
|
0.6
|
%
|
|
$
|
1,877
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Automobile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CLP Auto Interior Corporation*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
4.99
|
%
|
|
|
06/2013
|
|
|
|
3,146
|
|
|
|
3,146
|
|
|
|
0.9
|
|
|
|
2,988
|
|
Driven Brands, Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.53
|
%
|
|
|
10/2014
|
|
|
|
5,109
|
|
|
|
5,109
|
|
|
|
1.6
|
|
|
|
5,108
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,255
|
|
|
|
8,255
|
|
|
|
2.5
|
|
|
|
8,096
|
|
Banking
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prommis Solutions Inc.*
(5)
|
|
Senior loan
|
|
|
P + 3.25
|
%
|
|
|
5.25
|
%
|
|
|
02/2013
|
|
|
|
1,237
|
|
|
|
1,237
|
|
|
|
0.2
|
|
|
|
928
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,237
|
|
|
|
1,237
|
|
|
|
0.2
|
|
|
|
928
|
|
Beverage, Food and Tobacco
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ABP Corporation*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.75
|
%
|
|
|
06/2016
|
|
|
|
4,582
|
|
|
|
4,498
|
|
|
|
1.4
|
|
|
|
4,581
|
|
ABP Corporation
(3)
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(7
|
)
|
|
|
-
|
|
|
|
-
|
|
Ameriqual Group, LLC*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.51
|
%
|
|
|
03/2016
|
|
|
|
1,960
|
|
|
|
1,924
|
|
|
|
0.6
|
|
|
|
1,960
|
|
Ameriqual Group, LLC*
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
9.00
|
%
|
|
|
03/2016
|
|
|
|
848
|
|
|
|
833
|
|
|
|
0.3
|
|
|
|
848
|
|
Atkins Nutrionals, Inc.
|
|
Second lien
|
|
|
L + 10.92
|
%
|
|
|
12.92
|
%
|
|
|
12/2015
|
|
|
|
5,028
|
|
|
|
4,944
|
|
|
|
1.6
|
|
|
|
5,028
|
|
Bertucci's Corporation*
|
|
Second lien
|
|
|
L + 11.26
|
%
|
|
|
14.27
|
%
|
|
|
07/2012
|
|
|
|
1,943
|
|
|
|
1,921
|
|
|
|
0.6
|
|
|
|
1,943
|
|
IL Fornaio (America) Corporation*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.50
|
%
|
|
|
06/2017
|
|
|
|
4,831
|
|
|
|
4,808
|
|
|
|
1.5
|
|
|
|
4,807
|
|
Julio & Sons Company
(3)
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
N/A
|
(4)
|
|
|
09/2014
|
|
|
|
-
|
|
|
|
(22
|
)
|
|
|
-
|
|
|
|
(22
|
)
|
Julio & Sons Company
(3)
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
N/A
|
(4)
|
|
|
09/2016
|
|
|
|
-
|
|
|
|
(15
|
)
|
|
|
-
|
|
|
|
(15
|
)
|
Julio & Sons Company*
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
8.50
|
%
|
|
|
09/2016
|
|
|
|
7,175
|
|
|
|
7,104
|
|
|
|
2.2
|
|
|
|
7,103
|
|
Noodles & Company*
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
5.75
|
%
|
|
|
02/2016
|
|
|
|
1,621
|
|
|
|
1,607
|
|
|
|
0.5
|
|
|
|
1,621
|
|
Richelieu Foods, Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.76
|
%
|
|
|
11/2015
|
|
|
|
2,225
|
|
|
|
2,174
|
|
|
|
0.7
|
|
|
|
2,225
|
|
Richelieu Foods, Inc.
|
|
Senior loan
|
|
|
P + 4.00
|
%
|
|
|
7.25
|
%
|
|
|
11/2015
|
|
|
|
132
|
|
|
|
119
|
|
|
|
-
|
|
|
|
132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,345
|
|
|
|
29,888
|
|
|
|
9.4
|
|
|
|
30,211
|
|
Building and Real Estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
American Fire Protection Group, Inc.
(5)
|
|
Senior loan
|
|
|
L + 6.75
|
%
|
|
|
9.00
|
%
|
|
|
06/2011
|
|
|
|
4,422
|
|
|
|
4,124
|
|
|
|
0.3
|
|
|
|
1,105
|
|
ASP PDM Acquisition Co. LLC*
|
|
Senior loan
|
|
|
L + 2.75
|
%
|
|
|
3.29
|
%
|
|
|
12/2013
|
|
|
|
457
|
|
|
|
436
|
|
|
|
0.1
|
|
|
|
411
|
|
Infiltrator Systems, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
8.50
|
%
|
|
|
09/2012
|
|
|
|
7,548
|
|
|
|
7,405
|
|
|
|
2.4
|
|
|
|
7,548
|
|
ITEL Laboratories, Inc.*
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
5.75
|
%
|
|
|
03/2014
|
|
|
|
7,633
|
|
|
|
7,556
|
|
|
|
2.4
|
|
|
|
7,633
|
|
KHKI Acquisition, Inc.
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
8.50
|
%
|
|
|
03/2012
|
|
|
|
118
|
|
|
|
118
|
|
|
|
-
|
|
|
|
118
|
|
KHKI Acquisition, Inc.
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
8.50
|
%
|
|
|
03/2013
|
|
|
|
2,600
|
|
|
|
2,598
|
|
|
|
0.7
|
|
|
|
2,080
|
|
Tecta America Corp.
|
|
Senior loan
|
|
|
P + 5.75
|
%
|
|
|
9.00
|
%
|
|
|
03/2014
|
|
|
|
2,285
|
|
|
|
2,285
|
|
|
|
0.6
|
|
|
|
2,029
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25,063
|
|
|
|
24,522
|
|
|
|
6.5
|
|
|
|
20,924
|
|
Cargo Transport
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TMW Systems, Inc.*
|
|
Senior loan
|
|
|
L + 4.25
|
%
|
|
|
5.80
|
%
|
|
|
05/2016
|
|
|
|
2,167
|
|
|
|
2,137
|
|
|
|
0.7
|
|
|
|
2,102
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chemicals, Plastics and Rubber
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Flint Trading, Inc.*
|
|
Senior loan
|
|
|
L + 7.25
|
%
|
|
|
8.75
|
%
|
|
|
06/2016
|
|
|
|
12,466
|
|
|
|
12,403
|
|
|
|
3.9
|
|
|
|
12,466
|
|
Flint Trading, Inc.
(3)
|
|
Senior loan
|
|
|
L + 7.25
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(10
|
)
|
|
|
-
|
|
|
|
-
|
|
Syrgis Holdings, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.75
|
%
|
|
|
08/2012
|
|
|
|
186
|
|
|
|
182
|
|
|
|
0.1
|
|
|
|
186
|
|
Syrgis Holdings, Inc.*
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
8.25
|
%
|
|
|
08/2013
|
|
|
|
864
|
|
|
|
836
|
|
|
|
0.3
|
|
|
|
864
|
|
Syrgis Holdings, Inc.*
|
|
Senior loan
|
|
|
L + 8.50
|
%
|
|
|
10.75
|
%
|
|
|
02/2014
|
|
|
|
474
|
|
|
|
457
|
|
|
|
0.1
|
|
|
|
474
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,990
|
|
|
|
13,868
|
|
|
|
4.4
|
|
|
|
13,990
|
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments (Continued)
September 30, 2011
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
|
|
Investment
|
|
Spread Above
|
|
|
Interest
|
|
|
Maturity
|
|
|
Principal
|
|
|
|
|
|
of Total
|
|
|
Fair
|
|
|
|
Type
|
|
Index
(1)
|
|
|
Rate
(2)
|
|
|
Date
|
|
|
Amount
|
|
|
Cost
|
|
|
Net Assets
|
|
|
Value
|
|
Containers, Packaging and Glass
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fort Dearborn Company*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.65
|
%
|
|
|
08/2015
|
|
|
$
|
23
|
|
|
$
|
22
|
|
|
|
-
|
%
|
|
$
|
23
|
|
Fort Dearborn Company*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
7.12
|
%
|
|
|
08/2016
|
|
|
|
49
|
|
|
|
48
|
|
|
|
-
|
|
|
|
49
|
|
Fort Dearborn Company*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.50
|
%
|
|
|
08/2015
|
|
|
|
1,473
|
|
|
|
1,450
|
|
|
|
0.5
|
|
|
|
1,473
|
|
Fort Dearborn Company*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
7.00
|
%
|
|
|
08/2016
|
|
|
|
3,258
|
|
|
|
3,205
|
|
|
|
1.0
|
|
|
|
3,258
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,803
|
|
|
|
4,725
|
|
|
|
1.5
|
|
|
|
4,803
|
|
Diversified Conglomerate Manufacturing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Heat Transfer Parent, Inc.*
|
|
Senior loan
|
|
|
L + 3.00
|
%
|
|
|
3.24
|
%
|
|
|
06/2013
|
|
|
|
1,790
|
|
|
|
1,748
|
|
|
|
0.5
|
|
|
|
1,682
|
|
Neptco Inc.
(6)
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
8.00
|
%
|
|
|
03/2013
|
|
|
|
3,920
|
|
|
|
3,838
|
|
|
|
1.1
|
|
|
|
3,607
|
|
OnCore Manufacturing LLC*
|
|
Senior loan
|
|
|
L + 8.00
|
%
|
|
|
11.00
|
%
|
|
|
06/2016
|
|
|
|
3,542
|
|
|
|
3,482
|
|
|
|
1.2
|
|
|
|
3,648
|
|
Pasternack Enterprises, Inc.*
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
6.00
|
%
|
|
|
02/2014
|
|
|
|
4,467
|
|
|
|
4,381
|
|
|
|
1.4
|
|
|
|
4,377
|
|
Sunless Merger Sub, Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.25
|
%
|
|
|
07/2016
|
|
|
|
2,412
|
|
|
|
2,400
|
|
|
|
0.8
|
|
|
|
2,400
|
|
Sunless Merger Sub, Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
N/A
|
(4)
|
|
|
07/2016
|
|
|
|
-
|
|
|
|
(1
|
)
|
|
|
-
|
|
|
|
(1
|
)
|
Tecomet Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(7
|
)
|
|
|
-
|
|
|
|
-
|
|
Tecomet Inc.*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
7.00
|
%
|
|
|
12/2015
|
|
|
|
4,564
|
|
|
|
4,520
|
|
|
|
1.4
|
|
|
|
4,564
|
|
Vintage Parts, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
5.75
|
%
|
|
|
12/2013
|
|
|
|
6,596
|
|
|
|
6,534
|
|
|
|
2.0
|
|
|
|
6,398
|
|
Vintage Parts, Inc.*
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
8.50
|
%
|
|
|
12/2013
|
|
|
|
92
|
|
|
|
92
|
|
|
|
-
|
|
|
|
92
|
|
Vintage Parts, Inc.*
|
|
Senior loan
|
|
|
L + 8.00
|
%
|
|
|
9.75
|
%
|
|
|
12/2013
|
|
|
|
1,378
|
|
|
|
1,415
|
|
|
|
0.4
|
|
|
|
1,420
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28,761
|
|
|
|
28,402
|
|
|
|
8.8
|
|
|
|
28,187
|
|
Diversified Conglomerate Service
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benetech, Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
5.22
|
%
|
|
|
12/2013
|
|
|
|
8,845
|
|
|
|
8,649
|
|
|
|
2.8
|
|
|
|
8,845
|
|
CIBT Holdings
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(3
|
)
|
|
|
-
|
|
|
|
-
|
|
CIBT Holdings*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.50
|
%
|
|
|
12/2015
|
|
|
|
1,055
|
|
|
|
1,055
|
|
|
|
0.3
|
|
|
|
1,055
|
|
Compass Group Diversified Holdings, LLC*
|
|
Senior loan
|
|
|
L + 4.00
|
%
|
|
|
4.25
|
%
|
|
|
12/2013
|
|
|
|
4,444
|
|
|
|
4,444
|
|
|
|
1.4
|
|
|
|
4,444
|
|
Cortz, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.00
|
%
|
|
|
03/2014
|
|
|
|
6,624
|
|
|
|
6,585
|
|
|
|
2.1
|
|
|
|
6,624
|
|
Digital Technology International, LLC
(3)
|
|
Senior loan
|
|
|
P + 6.00
|
%
|
|
|
N/A
|
(4)
|
|
|
09/2016
|
|
|
|
-
|
|
|
|
(9
|
)
|
|
|
-
|
|
|
|
(9
|
)
|
Digital Technology International, LLC
|
|
Senior loan
|
|
|
L + 7.25
|
%
|
|
|
8.75
|
%
|
|
|
09/2016
|
|
|
|
6,495
|
|
|
|
6,365
|
|
|
|
2.0
|
|
|
|
6,430
|
|
EAG, Inc.*
|
|
Senior loan
|
|
|
P + 3.50
|
%
|
|
|
6.75
|
%
|
|
|
07/2017
|
|
|
|
2,732
|
|
|
|
2,687
|
|
|
|
0.9
|
|
|
|
2,732
|
|
Evolution1, Inc.
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(24
|
)
|
|
|
-
|
|
|
|
(33
|
)
|
Evolution1, Inc.
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(5
|
)
|
|
|
-
|
|
|
|
(7
|
)
|
Evolution1, Inc.*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
06/2016
|
|
|
|
4,654
|
|
|
|
4,588
|
|
|
|
1.4
|
|
|
|
4,561
|
|
HighJump Acquisition LLC
(3)
|
|
Senior loan
|
|
|
L + 8.75
|
%
|
|
|
N/A
|
(4)
|
|
|
07/2016
|
|
|
|
-
|
|
|
|
(15
|
)
|
|
|
-
|
|
|
|
(16
|
)
|
HighJump Acquisition LLC
|
|
Senior loan
|
|
|
L + 8.75
|
%
|
|
|
10.00
|
%
|
|
|
07/2016
|
|
|
|
5,496
|
|
|
|
5,417
|
|
|
|
1.7
|
|
|
|
5,469
|
|
NS Holdings, Inc.*
(3)
|
|
Senior loan
|
|
|
L + 6.25
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2015
|
|
|
|
-
|
|
|
|
(6
|
)
|
|
|
-
|
|
|
|
-
|
|
NS Holdings, Inc.*
|
|
Senior loan
|
|
|
L + 6.28
|
%
|
|
|
7.65
|
%
|
|
|
06/2015
|
|
|
|
2,140
|
|
|
|
2,107
|
|
|
|
0.7
|
|
|
|
2,140
|
|
QuadraMed Corporation*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.75
|
%
|
|
|
07/2016
|
|
|
|
1,215
|
|
|
|
1,203
|
|
|
|
0.4
|
|
|
|
1,202
|
|
Royall & Company*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
11/2015
|
|
|
|
770
|
|
|
|
757
|
|
|
|
0.2
|
|
|
|
770
|
|
The Service Companies, Inc.*
|
|
Senior loan
|
|
|
L + 6.50
|
%
|
|
|
9.00
|
%
|
|
|
03/2014
|
|
|
|
5,573
|
|
|
|
5,573
|
|
|
|
1.8
|
|
|
|
5,573
|
|
Sumtotal Systems, Inc.*
|
|
Senior loan
|
|
|
L + 4.25
|
%
|
|
|
5.50
|
%
|
|
|
12/2015
|
|
|
|
1,552
|
|
|
|
1,536
|
|
|
|
0.5
|
|
|
|
1,552
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
51,595
|
|
|
|
50,904
|
|
|
|
16.2
|
|
|
|
51,332
|
|
Diversified Natural Resources, Precious Metals, and Minerals
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metal Spinners, Inc.*
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
10.00
|
%
|
|
|
12/2014
|
|
|
|
1,728
|
|
|
|
1,681
|
|
|
|
0.5
|
|
|
|
1,728
|
|
Metal Spinners, Inc.*
(6)
|
|
Senior loan
|
|
|
L + 11.00
|
%
|
|
|
14.00
|
%
|
|
|
12/2014
|
|
|
|
3,153
|
|
|
|
3,072
|
|
|
|
1.0
|
|
|
|
3,153
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,881
|
|
|
|
4,753
|
|
|
|
1.5
|
|
|
|
4,881
|
|
Electronics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cape Electrical Supply LLC*
(6)
|
|
Senior loan
|
|
|
L + 6.25
|
%
|
|
|
7.50
|
%
|
|
|
11/2013
|
|
|
|
1,973
|
|
|
|
1,899
|
|
|
|
0.6
|
|
|
|
1,973
|
|
Entrust, Inc.*
|
|
Senior loan
|
|
|
L + 7.22
|
%
|
|
|
8.72
|
%
|
|
|
03/2017
|
|
|
|
4,273
|
|
|
|
4,259
|
|
|
|
1.3
|
|
|
|
4,273
|
|
Entrust, Inc.*
|
|
Senior loan
|
|
|
L + 7.23
|
%
|
|
|
8.73
|
%
|
|
|
03/2017
|
|
|
|
9,971
|
|
|
|
9,961
|
|
|
|
3.1
|
|
|
|
9,971
|
|
Syncsort Incorporated
(3)
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
N/A
|
(4)
|
|
|
03/2015
|
|
|
|
-
|
|
|
|
(6
|
)
|
|
|
-
|
|
|
|
-
|
|
Syncsort Incorporated*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.50
|
%
|
|
|
03/2015
|
|
|
|
8,981
|
|
|
|
8,981
|
|
|
|
2.8
|
|
|
|
8,981
|
|
Time-O-Matic, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
13.25
|
%
|
|
|
12/2016
|
|
|
|
11,416
|
|
|
|
11,199
|
|
|
|
3.6
|
|
|
|
11,416
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36,614
|
|
|
|
36,293
|
|
|
|
11.4
|
|
|
|
36,614
|
|
Farming and Agriculture
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AGData, L.P.
|
|
Senior loan
|
|
|
L + 6.25
|
%
|
|
|
7.75
|
%
|
|
|
08/2016
|
|
|
|
2,972
|
|
|
|
2,931
|
|
|
|
0.9
|
|
|
|
2,972
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonddesk Group LLC*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
09/2016
|
|
|
|
1,018
|
|
|
|
1,008
|
|
|
|
0.3
|
|
|
|
1,008
|
|
Pillar Processing LLC*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
5.73
|
%
|
|
|
05/2014
|
|
|
|
3,125
|
|
|
|
3,125
|
|
|
|
0.9
|
|
|
|
2,969
|
|
Pillar Processing LLC*
|
|
Senior loan
|
|
|
N/A
|
|
|
|
14.50
|
%
|
|
|
11/2013
|
|
|
|
3,018
|
|
|
|
3,012
|
|
|
|
0.9
|
|
|
|
2,807
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,161
|
|
|
|
7,145
|
|
|
|
2.1
|
|
|
|
6,784
|
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments (Continued)
September 30, 2011
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
|
|
Investment
|
|
Spread Above
|
|
|
Interest
|
|
|
Maturity
|
|
|
Principal
|
|
|
|
|
|
of Total
|
|
|
Fair
|
|
|
|
Type
|
|
Index
(1)
|
|
|
Rate
(2)
|
|
|
Date
|
|
|
Amount
|
|
|
Cost
|
|
|
Net Assets
|
|
|
Value
|
|
Healthcare, Education and Childcare
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADG, LLC
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
03/2014
|
|
|
$
|
-
|
|
|
$
|
(5
|
)
|
|
|
-
|
%
|
|
$
|
-
|
|
ADG, LLC
|
|
Senior loan
|
|
|
P + 3.75
|
%
|
|
|
7.00
|
%
|
|
|
03/2014
|
|
|
|
21
|
|
|
|
17
|
|
|
|
-
|
|
|
|
21
|
|
ADG, LLC*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
03/2014
|
|
|
|
3,389
|
|
|
|
3,389
|
|
|
|
1.1
|
|
|
|
3,389
|
|
Advanced Pain Management Holdings, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
06/2016
|
|
|
|
7,798
|
|
|
|
7,632
|
|
|
|
2.5
|
|
|
|
7,798
|
|
Avatar International, LLC*
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
8.75
|
%
|
|
|
09/2016
|
|
|
|
8,056
|
|
|
|
7,917
|
|
|
|
2.5
|
|
|
|
7,955
|
|
Avatar International, LLC
(3)
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
N/A
|
(4)
|
|
|
09/2016
|
|
|
|
-
|
|
|
|
(10
|
)
|
|
|
-
|
|
|
|
(10
|
)
|
Campus Management Acquisition Corp.
|
|
Second lien
|
|
|
L + 8.25
|
%
|
|
|
10.00
|
%
|
|
|
09/2015
|
|
|
|
5,315
|
|
|
|
5,230
|
|
|
|
1.7
|
|
|
|
5,315
|
|
CHS/Community Health Systems *
|
|
Senior loan
|
|
|
L + 2.25
|
%
|
|
|
2.57
|
%
|
|
|
07/2014
|
|
|
|
519
|
|
|
|
514
|
|
|
|
0.2
|
|
|
|
486
|
|
Community Hospices of America, Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(6
|
)
|
|
|
-
|
|
|
|
-
|
|
Community Hospices of America, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.25
|
%
|
|
|
12/2015
|
|
|
|
5,233
|
|
|
|
5,145
|
|
|
|
1.7
|
|
|
|
5,233
|
|
Community Hospices of America, Inc.
(6)
|
|
Subordinated debt
|
|
|
L + 11.75
|
%
|
|
|
13.75
|
%
|
|
|
06/2016
|
|
|
|
1,822
|
|
|
|
1,784
|
|
|
|
0.6
|
|
|
|
1,822
|
|
DDC Center Inc.*
|
|
Senior loan
|
|
|
L + 6.50
|
%
|
|
|
9.50
|
%
|
|
|
10/2014
|
|
|
|
8,591
|
|
|
|
8,591
|
|
|
|
2.7
|
|
|
|
8,420
|
|
Delta Educational Systems, Inc.*
|
|
Senior loan
|
|
|
P + 2.75
|
%
|
|
|
6.00
|
%
|
|
|
06/2012
|
|
|
|
2,924
|
|
|
|
2,881
|
|
|
|
0.9
|
|
|
|
2,924
|
|
Den-Mat Holdings, LLC
(5)(6)
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
8.50
|
%
|
|
|
06/2014
|
|
|
|
3,419
|
|
|
|
3,350
|
|
|
|
0.3
|
|
|
|
858
|
|
Ernest Healthcare, Inc.*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
05/2016
|
|
|
|
2,527
|
|
|
|
2,504
|
|
|
|
0.8
|
|
|
|
2,527
|
|
G & H Wire Company, Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(11
|
)
|
|
|
-
|
|
|
|
-
|
|
G & H Wire Company, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.25
|
%
|
|
|
12/2015
|
|
|
|
5,775
|
|
|
|
5,674
|
|
|
|
1.8
|
|
|
|
5,775
|
|
Hospitalists Management Group, LLC
(3)
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2017
|
|
|
|
-
|
|
|
|
(13
|
)
|
|
|
-
|
|
|
|
(18
|
)
|
Hospitalists Management Group, LLC
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
6.00
|
%
|
|
|
05/2017
|
|
|
|
415
|
|
|
|
402
|
|
|
|
0.1
|
|
|
|
397
|
|
Hospitalists Management Group, LLC
|
|
Senior loan
|
|
|
P + 3.50
|
%
|
|
|
6.75
|
%
|
|
|
05/2017
|
|
|
|
4,175
|
|
|
|
4,077
|
|
|
|
1.3
|
|
|
|
4,091
|
|
The Hygenic Corporation*
|
|
Senior loan
|
|
|
L + 2.50
|
%
|
|
|
2.75
|
%
|
|
|
04/2013
|
|
|
|
2,242
|
|
|
|
2,209
|
|
|
|
0.7
|
|
|
|
2,197
|
|
Integrated DNA Technologies, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
04/2015
|
|
|
|
3,800
|
|
|
|
3,752
|
|
|
|
1.2
|
|
|
|
3,800
|
|
Integrated DNA Technologies, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
04/2015
|
|
|
|
450
|
|
|
|
444
|
|
|
|
0.1
|
|
|
|
450
|
|
Integrated DNA Technologies, Inc.
(3)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
N/A
|
(4)
|
|
|
04/2015
|
|
|
|
-
|
|
|
|
(6
|
)
|
|
|
-
|
|
|
|
-
|
|
Maverick Healthcare Group, LLC *
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.25
|
%
|
|
|
12/2016
|
|
|
|
2,251
|
|
|
|
2,219
|
|
|
|
0.7
|
|
|
|
2,251
|
|
NeuroTherm, Inc.
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
02/2016
|
|
|
|
243
|
|
|
|
236
|
|
|
|
0.1
|
|
|
|
243
|
|
NeuroTherm, Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
02/2016
|
|
|
|
1,707
|
|
|
|
1,673
|
|
|
|
0.5
|
|
|
|
1,707
|
|
Reliant Pro ReHab, LLC*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.00
|
%
|
|
|
06/2016
|
|
|
|
3,793
|
|
|
|
3,730
|
|
|
|
1.2
|
|
|
|
3,755
|
|
Reliant Pro ReHab, LLC
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(21
|
)
|
|
|
-
|
|
|
|
(18
|
)
|
Reliant Pro ReHab, LLC
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(10
|
)
|
|
|
-
|
|
|
|
(6
|
)
|
Sterilmed, Inc.*
(6)
|
|
Senior loan
|
|
|
L + 8.50
|
%
|
|
|
10.00
|
%
|
|
|
07/2016
|
|
|
|
3,079
|
|
|
|
3,079
|
|
|
|
1.0
|
|
|
|
3,079
|
|
Sterilmed, Inc.
(3)
|
|
Senior loan
|
|
|
L + 6.25
|
%
|
|
|
N/A
|
(4)
|
|
|
07/2015
|
|
|
|
-
|
|
|
|
(7
|
)
|
|
|
-
|
|
|
|
-
|
|
Surgical Information Systems, LLC
|
|
Second lien
|
|
|
L + 7.73
|
%
|
|
|
9.23
|
%
|
|
|
12/2015
|
|
|
|
5,047
|
|
|
|
4,961
|
|
|
|
1.6
|
|
|
|
5,047
|
|
TIDI Products, LLC*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
05/2015
|
|
|
|
2,228
|
|
|
|
2,228
|
|
|
|
0.7
|
|
|
|
2,228
|
|
TIDI Products, LLC
(3)
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2015
|
|
|
|
-
|
|
|
|
(5
|
)
|
|
|
-
|
|
|
|
-
|
|
United Surgical Partners
International, Inc.*
|
|
Senior loan
|
|
|
L + 2.00
|
%
|
|
|
2.24
|
%
|
|
|
04/2014
|
|
|
|
1,514
|
|
|
|
1,514
|
|
|
|
0.5
|
|
|
|
1,430
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
86,333
|
|
|
|
85,058
|
|
|
|
26.5
|
|
|
|
83,146
|
|
Home and Office
Furnishings,
Housewares, and Durable Consumer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amerifile, LLC*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
03/2016
|
|
|
|
4,434
|
|
|
|
4,375
|
|
|
|
1.4
|
|
|
|
4,434
|
|
Top Knobs USA, Inc.*
|
|
Senior loan
|
|
|
L + 5.75
|
%
|
|
|
7.75
|
%
|
|
|
11/2016
|
|
|
|
1,176
|
|
|
|
1,156
|
|
|
|
0.4
|
|
|
|
1,176
|
|
WII Components, Inc.*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
07/2016
|
|
|
|
1,824
|
|
|
|
1,798
|
|
|
|
0.6
|
|
|
|
1,797
|
|
WII Components, Inc.
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
07/2016
|
|
|
|
-
|
|
|
|
(2
|
)
|
|
|
-
|
|
|
|
(2
|
)
|
Zenith Products Corporation*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
5.43
|
%
|
|
|
09/2013
|
|
|
|
4,141
|
|
|
|
4,090
|
|
|
|
1.3
|
|
|
|
4,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11,575
|
|
|
|
11,417
|
|
|
|
3.7
|
|
|
|
11,463
|
|
Leisure, Amusement, Motion Pictures and Entertainment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Competitor Group, Inc.
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
9.50
|
%
|
|
|
09/2015
|
|
|
|
389
|
|
|
|
370
|
|
|
|
0.1
|
|
|
|
389
|
|
Competitor Group, Inc.
|
|
Senior loans
|
|
|
L + 7.50
|
%
|
|
|
N/A
|
(4)
|
|
|
09/2015
|
|
|
|
3,557
|
|
|
|
3,468
|
|
|
|
1.1
|
|
|
|
3,557
|
|
Competitor Group, Inc.*
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
9.50
|
%
|
|
|
09/2015
|
|
|
|
7,783
|
|
|
|
7,629
|
|
|
|
2.5
|
|
|
|
7,783
|
|
Octane Fitness, LLC*
|
|
Senior loan
|
|
|
L + 4.60
|
%
|
|
|
4.85
|
%
|
|
|
03/2013
|
|
|
|
4,675
|
|
|
|
4,596
|
|
|
|
1.4
|
|
|
|
4,582
|
|
Optronics Product Company, Inc.*
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
5.50
|
%
|
|
|
12/2012
|
|
|
|
79
|
|
|
|
77
|
|
|
|
-
|
|
|
|
79
|
|
Optronics Product Company, Inc.*
|
|
Second lien
|
|
|
L + 7.25
|
%
|
|
|
8.25
|
%
|
|
|
12/2013
|
|
|
|
2,489
|
|
|
|
2,412
|
|
|
|
0.8
|
|
|
|
2,489
|
|
Premier Yachts, Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(3
|
)
|
|
|
-
|
|
|
|
-
|
|
Premier Yachts, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.00
|
%
|
|
|
12/2015
|
|
|
|
681
|
|
|
|
670
|
|
|
|
0.2
|
|
|
|
681
|
|
Pride Manufacturing
Company, LLC*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.25
|
%
|
|
|
11/2015
|
|
|
|
819
|
|
|
|
805
|
|
|
|
0.3
|
|
|
|
819
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,472
|
|
|
|
20,024
|
|
|
|
6.4
|
|
|
|
20,379
|
|
Oil and Gas
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tri-County Petroleum, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
08/2015
|
|
|
|
7,206
|
|
|
|
7,077
|
|
|
|
2.3
|
|
|
|
7,206
|
|
Tri-County Petroleum, Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
02/2015
|
|
|
|
6,480
|
|
|
|
6,359
|
|
|
|
2.0
|
|
|
|
6,480
|
|
Tri-County Petroleum,
Inc.*
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
6.02
|
%
|
|
|
02/2015
|
|
|
|
3,051
|
|
|
|
3,024
|
|
|
|
1.0
|
|
|
|
3,051
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,737
|
|
|
|
16,460
|
|
|
|
5.3
|
|
|
|
16,737
|
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments (Continued)
September 30, 2011
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
|
|
Investment
|
|
Spread Above
|
|
|
Interest
|
|
|
Maturity
|
|
|
Principal
|
|
|
|
|
|
of Total
|
|
|
Fair
|
|
|
|
Type
|
|
Index
(1)
|
|
|
Rate
(2)
|
|
|
Date
|
|
|
Amount
|
|
|
Cost
|
|
|
Net Assets
|
|
|
Value
|
|
Personal and
Non-Durable Consumer Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dr. Miracles, Inc.*
(6)
|
|
Senior loan
|
|
|
L + 7.50
|
%
|
|
|
10.00
|
%
|
|
|
03/2014
|
|
|
$
|
3,344
|
|
|
$
|
3,317
|
|
|
|
1.0
|
%
|
|
$
|
3,210
|
|
Massage Envy, LLC
(3)
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(1
|
)
|
|
|
-
|
|
|
|
-
|
|
Massage Envy, LLC*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
06/2016
|
|
|
|
6,742
|
|
|
|
6,742
|
|
|
|
2.2
|
|
|
|
6,742
|
|
MTS Medication Technologies, Inc.
(3)
|
|
Senior loan
|
|
|
P + 4.25
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2016
|
|
|
|
-
|
|
|
|
(2
|
)
|
|
|
-
|
|
|
|
-
|
|
MTS Medication Technologies, Inc.*
|
|
Senior loan
|
|
|
L + 5.50
|
%
|
|
|
7.00
|
%
|
|
|
06/2016
|
|
|
|
1,601
|
|
|
|
1,590
|
|
|
|
0.5
|
|
|
|
1,601
|
|
Strategic Partners, Inc.
(6)
|
|
Subordinated debt
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
02/2017
|
|
|
|
9,636
|
|
|
|
9,415
|
|
|
|
3.1
|
|
|
|
9,636
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,323
|
|
|
|
21,061
|
|
|
|
6.8
|
|
|
|
21,189
|
|
Personal, Food and
Miscellaneous
Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Affordable Care Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
N/A
|
(4)
|
|
|
12/2015
|
|
|
|
-
|
|
|
|
(8
|
)
|
|
|
-
|
|
|
|
-
|
|
Affordable Care Inc.*
|
|
Senior loan
|
|
|
L + 5.00
|
%
|
|
|
6.50
|
%
|
|
|
12/2015
|
|
|
|
3,686
|
|
|
|
3,638
|
|
|
|
1.2
|
|
|
|
3,686
|
|
Automatic Bar Controls, Inc.*
|
|
Senior loan
|
|
|
L + 5.75
|
%
|
|
|
7.44
|
%
|
|
|
03/2016
|
|
|
|
1,125
|
|
|
|
1,110
|
|
|
|
0.4
|
|
|
|
1,125
|
|
Automatic Bar Controls, Inc.
(3)
|
|
Senior loan
|
|
|
P + 4.75
|
%
|
|
|
8.00
|
%
|
|
|
03/2016
|
|
|
|
2
|
|
|
|
(1
|
)
|
|
|
-
|
|
|
|
2
|
|
Ignite Restaurant Group, Inc.*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.25
|
%
|
|
|
03/2016
|
|
|
|
6,633
|
|
|
|
6,633
|
|
|
|
2.1
|
|
|
|
6,633
|
|
NVA Acquisition Company
|
|
Senior loan
|
|
|
L + 4.25
|
%
|
|
|
5.50
|
%
|
|
|
06/2016
|
|
|
|
1,900
|
|
|
|
1,900
|
|
|
|
0.6
|
|
|
|
1,824
|
|
Restaurant Technologies, Inc.
(3)
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2017
|
|
|
|
-
|
|
|
|
(2
|
)
|
|
|
-
|
|
|
|
-
|
|
Restaurant Technologies, Inc.*
|
|
Senior loan
|
|
|
L + 4.75
|
%
|
|
|
6.00
|
%
|
|
|
05/2017
|
|
|
|
1,116
|
|
|
|
1,106
|
|
|
|
0.4
|
|
|
|
1,116
|
|
Trusthouse Service Group, Inc.
(3)
|
|
Senior loan
|
|
|
L + 5.13
|
%
|
|
|
N/A
|
(4)
|
|
|
07/2017
|
|
|
|
-
|
|
|
|
(5
|
)
|
|
|
-
|
|
|
|
(5
|
)
|
Trusthouse Service Group, Inc.
|
|
Senior loan
|
|
|
P + 4.13
|
%
|
|
|
7.38
|
%
|
|
|
07/2016
|
|
|
|
3
|
|
|
|
3
|
|
|
|
-
|
|
|
|
3
|
|
Trusthouse Service Group, Inc.
|
|
Senior loan
|
|
|
L + 5.13
|
%
|
|
|
6.63
|
%
|
|
|
07/2017
|
|
|
|
1,044
|
|
|
|
1,029
|
|
|
|
0.3
|
|
|
|
1,029
|
|
Vetcor Professional Practices LLC*
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
7.50
|
%
|
|
|
02/2015
|
|
|
|
1,944
|
|
|
|
1,944
|
|
|
|
0.6
|
|
|
|
1,944
|
|
Vetcor Professional Practices LLC
(3)
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
N/A
|
(4)
|
|
|
02/2015
|
|
|
|
-
|
|
|
|
(120
|
)
|
|
|
-
|
|
|
|
-
|
|
Vetcor Professional Practices LLC
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
7.50
|
%
|
|
|
02/2015
|
|
|
|
2,020
|
|
|
|
2,020
|
|
|
|
0.6
|
|
|
|
2,020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,473
|
|
|
|
19,247
|
|
|
|
6.2
|
|
|
|
19,377
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Printing and Publishing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market Track, LLC
(3)
|
|
Senior loan
|
|
|
L + 7.75
|
%
|
|
|
N/A
|
(4)
|
|
|
11/2015
|
|
|
|
-
|
|
|
|
(20
|
)
|
|
|
-
|
|
|
|
-
|
|
Market Track, LLC*
|
|
Senior loan
|
|
|
L + 7.75
|
%
|
|
|
9.25
|
%
|
|
|
11/2015
|
|
|
|
12,768
|
|
|
|
12,563
|
|
|
|
4.1
|
|
|
|
12,768
|
|
Trade Service Company, LLC
(3)
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
N/A
|
(4)
|
|
|
06/2013
|
|
|
|
-
|
|
|
|
(1
|
)
|
|
|
-
|
|
|
|
-
|
|
Trade Service Company, LLC*
|
|
Senior loan
|
|
|
L + 5.25
|
%
|
|
|
6.75
|
%
|
|
|
06/2013
|
|
|
|
1,342
|
|
|
|
1,338
|
|
|
|
0.5
|
|
|
|
1,342
|
|
Trade Service Company, LLC*
(6)
|
|
Senior loan
|
|
|
N/A
|
|
|
|
14.00
|
%
|
|
|
06/2013
|
|
|
|
765
|
|
|
|
763
|
|
|
|
0.3
|
|
|
|
765
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,875
|
|
|
|
14,643
|
|
|
|
4.9
|
|
|
|
14,875
|
|
Retail Stores
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chuy's OPCO, Inc.
(3)
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2016
|
|
|
|
-
|
|
|
|
(3
|
)
|
|
|
-
|
|
|
|
-
|
|
Chuy's OPCO, Inc.
(3)
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2016
|
|
|
|
-
|
|
|
|
(21
|
)
|
|
|
-
|
|
|
|
-
|
|
Chuy's OPCO, Inc.
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
8.50
|
%
|
|
|
05/2016
|
|
|
|
8,639
|
|
|
|
8,458
|
|
|
|
2.8
|
|
|
|
8,639
|
|
DTLR, Inc.
|
|
Senior loan
|
|
|
L + 8.00
|
%
|
|
|
11.00
|
%
|
|
|
12/2015
|
|
|
|
5,861
|
|
|
|
5,738
|
|
|
|
1.9
|
|
|
|
5,861
|
|
The Marshall Retail Group, LLC*
|
|
Senior loan
|
|
|
L + 4.50
|
%
|
|
|
7.25
|
%
|
|
|
04/2013
|
|
|
|
2,574
|
|
|
|
2,516
|
|
|
|
0.8
|
|
|
|
2,574
|
|
The Marshall Retail Group, LLC*
|
|
Second lien
|
|
|
L + 6.50
|
%
|
|
|
9.25
|
%
|
|
|
04/2013
|
|
|
|
2,100
|
|
|
|
2,063
|
|
|
|
0.7
|
|
|
|
2,100
|
|
Rubio's Restaurants, Inc.*
|
|
Senior loan
|
|
|
L + 7.00
|
%
|
|
|
8.75
|
%
|
|
|
06/2015
|
|
|
|
9,433
|
|
|
|
9,280
|
|
|
|
3.0
|
|
|
|
9,433
|
|
Vision Source L.P.*
|
|
Senior loan
|
|
|
L + 6.75
|
%
|
|
|
8.00
|
%
|
|
|
04/2016
|
|
|
|
13,669
|
|
|
|
13,411
|
|
|
|
4.3
|
|
|
|
13,669
|
|
Vision Source L.P.
|
|
Senior loan
|
|
|
L + 6.75
|
%
|
|
|
8.00
|
%
|
|
|
04/2016
|
|
|
|
142
|
|
|
|
131
|
|
|
|
-
|
|
|
|
142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
42,418
|
|
|
|
41,573
|
|
|
|
13.5
|
|
|
|
42,418
|
|
Telecommunications
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hosting.com
|
|
Senior loan
|
|
|
L + 6.75
|
%
|
|
|
N/A
|
(4)
|
|
|
05/2014
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Hosting.com*
|
|
Senior loan
|
|
|
L + 6.75
|
%
|
|
|
8.25
|
%
|
|
|
05/2014
|
|
|
|
2,084
|
|
|
|
2,084
|
|
|
|
0.7
|
|
|
|
2,084
|
|
NameMedia, Inc.
|
|
Senior loan
|
|
|
P + 5.00
|
%
|
|
|
8.25
|
%
|
|
|
11/2014
|
|
|
|
9
|
|
|
|
8
|
|
|
|
-
|
|
|
|
8
|
|
NameMedia, Inc.
|
|
Senior loan
|
|
|
L + 6.00
|
%
|
|
|
7.50
|
%
|
|
|
11/2014
|
|
|
|
2,486
|
|
|
|
2,439
|
|
|
|
0.8
|
|
|
|
2,461
|
|
West Corporation
(3)
|
|
Senior loan
|
|
|
L + 2.00
|
%
|
|
|
N/A
|
(4)
|
|
|
10/2012
|
|
|
|
-
|
|
|
|
(124
|
)
|
|
|
(0.1
|
)
|
|
|
(200
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,579
|
|
|
|
4,407
|
|
|
|
1.4
|
|
|
|
4,353
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total debt investments United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
457,506
|
|
|
$
|
450,793
|
|
|
|
141.4
|
%
|
|
$
|
447,638
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value as a percentage of Principal Amount
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
97.8
|
%
|
See Notes to Consolidated Financial Statements.
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments (Continued)
September 30, 2011
(In thousands, except derivative contracts)
|
|
Investment
Type
|
|
Spread
Above
Index
(1)
|
|
|
Interest
Rate
(2)
|
|
|
Maturity
Date
|
|
|
Principal
Amount
/
Shares
/
Contracts
|
|
|
Cost
|
|
|
Percentage
of
Total
Net
Assets
|
|
|
Fair
Value
|
|
Equity investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aerospace and Defense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Whitcraft LLC
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
1
|
|
|
$
|
670
|
|
|
|
0.2
|
%
|
|
$
|
670
|
|
Whitcraft LLC
|
|
Warrant
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
117
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
670
|
|
|
|
0.2
|
|
|
|
787
|
|
Beverage, Food and Tobacco
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Atkins Nutrionals, Inc.
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
57
|
|
|
|
838
|
|
|
|
0.3
|
|
|
|
838
|
|
Julio & Sons Company
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
521
|
|
|
|
521
|
|
|
|
0.2
|
|
|
|
521
|
|
Richelieu Foods, Inc.
|
|
LP interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
220
|
|
|
|
220
|
|
|
|
0.1
|
|
|
|
220
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,579
|
|
|
|
0.6
|
|
|
|
1,579
|
|
Diversified Conglomerate
Manufacturing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Neptco Inc.
|
|
Warrant
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Sunless Merger Sub, Inc.
|
|
LP interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
148
|
|
|
|
0.1
|
|
|
|
148
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
148
|
|
|
|
0.1
|
|
|
|
148
|
|
Healthcare, Education and
Childcare
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advanced Pain Management Holdings, Inc.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
67
|
|
|
|
67
|
|
|
|
-
|
|
|
|
67
|
|
Advanced Pain Management Holdings, Inc.
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
13
|
|
|
|
1,273
|
|
|
|
0.4
|
|
|
|
1,273
|
|
Avatar International, LLC
|
|
LP interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
1
|
|
|
|
651
|
|
|
|
0.2
|
|
|
|
651
|
|
G & H Wire Company, Inc.
|
|
LP interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
102
|
|
|
|
-
|
|
|
|
102
|
|
Hospitalists Management Group, LLC
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
38
|
|
|
|
-
|
|
|
|
38
|
|
NeuroTherm, Inc.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
1
|
|
|
|
569
|
|
|
|
0.2
|
|
|
|
569
|
|
Reliant Pro ReHab, LLC
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
2
|
|
|
|
264
|
|
|
|
0.1
|
|
|
|
263
|
|
Surgical Information Systems, LLC
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
4
|
|
|
|
414
|
|
|
|
0.1
|
|
|
|
414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,378
|
|
|
|
1.0
|
|
|
|
3,377
|
|
Home and Office Furnishings,
Housewares, and Durable Consumer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Top Knobs USA, Inc.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
3
|
|
|
|
73
|
|
|
|
-
|
|
|
|
73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Personal and Non-Durable
Consumer Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic Partners, Inc.
|
|
LLC interest
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
169
|
|
|
|
1,691
|
|
|
|
0.5
|
|
|
|
1,691
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail Stores
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rubio's Restaurants, Inc.
|
|
Preferred stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
199
|
|
|
|
945
|
|
|
|
0.3
|
|
|
|
799
|
|
Vision Source L.P.
|
|
Common stock
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
9
|
|
|
|
936
|
|
|
|
0.3
|
|
|
|
936
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,881
|
|
|
|
0.6
|
|
|
|
1,735
|
|
Total equity investments
United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
9,420
|
|
|
|
3.0
|
%
|
|
$
|
9,390
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
460,213
|
|
|
|
144.4
|
%
|
|
$
|
457,028
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
462,961
|
|
|
|
145.2
|
%
|
|
$
|
459,827
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives, at fair value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Futures
contracts sold (Note 7)
|
|
Financial futures contracts
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
12/2011
|
|
|
|
250
|
|
|
$
|
-
|
|
|
|
(0.1
|
)%
|
|
$
|
(141
|
)
|
Total
return swap (Note 7)
|
|
Total return swap
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
06/2014
|
|
|
|
N/A
|
|
|
$
|
-
|
|
|
|
(0.7
|
)%
|
|
$
|
(1,845
|
)
|
Total
derivative instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
-
|
|
|
|
(0.7
|
)%
|
|
$
|
(1,986
|
)
|
* Denotes that all or a portion of the loan secures the notes
offered in the Debt Securitization.
|
(1)
|
The majority of the investments
bear interest at a rate that may be determined by reference to LIBOR "L" or Prime "P" and which reset daily,
quarterly or semiannually. For each we have provided
the spread over LIBOR or Prime and the weighted average current interest
rate in effect at September 30, 2011. Certain investments are subject to a LIBOR or Prime interest rate floor. For fixed rate
loans, a spread above a reference rate is not applicable.
|
|
(2)
|
For portfolio companies with multiple interest rate contracts,
the interest rate shown is a weighted average current interest rate in effect at September 30, 2011.
|
|
(3)
|
The negative fair value is the result of the capitalized
discount on the loan or the unfunded commitment being valued below par. The negative cost is the result of the capitalized discount
being greater than the principal amount outstanding on the loan.
|
|
(4)
|
The entire commitment was unfunded at September 30, 2011.
As such, no interest is being earned on this investment.
!
|
|
(5)
|
Loan was on non-accrual status as of September 30, 2011,
meaning that the Company has ceased recognizing interest income on the loan.
|
|
(6)
|
A portion of the interest may be deferred through a PIK
rate option.
|
See Notes to Consolidated Financial
Statements.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
Note 1. Organization
Golub Capital BDC, Inc. (“GBDC” and, together with
its subsidiaries, the “Company”) is an externally managed, closed-end, non-diversified management investment company.
GBDC has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940,
as amended (the “1940 Act”). In addition, for U.S. federal income tax purposes, GBDC has elected to be treated as a
regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”).
On April 13, 2010, Golub Capital BDC LLC (“GC LLC”)
converted from a Delaware limited liability company to a Delaware corporation, leaving GBDC as the surviving entity (the “Conversion”).
At the time of the Conversion, all limited liability company interests were exchanged for 8,984,863 shares of common stock in GBDC.
GBDC had no assets or operations prior to the Conversion and, as a result, the books and records of GC LLC have become the books
and records of the surviving entity. On April 14, 2010, GBDC completed its initial public offering.
GC LLC was formed in the State of Delaware on November 9, 2009
to continue and expand the business of Golub Capital Master Funding LLC (“GCMF”) which commenced operations on July
7, 2007. All of the outstanding limited liability company interests in GCMF were initially held by three Delaware limited liability
companies, Golub Capital Company IV, LLC, Golub Capital Company V LLC and Golub Capital Company VI LLC (collectively, the “Capital
Companies”). In November 2009, the Capital Companies formed GC LLC, into which they contributed 100% of the limited liability
company interests of GCMF and from which they received a proportionate number of limited liability company interests in GC LLC.
In February 2010, GEMS Fund L.P. (“GEMS”), a limited partnership affiliated through common management with the Capital
Companies, purchased an interest in GC LLC. As a result of the Conversion, the Capital Companies and GEMS received shares of common
stock in GBDC.
Subsequent to the Conversion, GCMF became a wholly owned subsidiary
of GBDC. GCMF’s financial results are consolidated with GBDC, and the portfolio investments held by GCMF are included in
the Company’s consolidated financial statements. All intercompany balances and transactions have been eliminated.
The Company’s investment strategy is to invest in senior
secured, one stop (a loan that combines characteristics of traditional first lien senior secured loans and second lien or subordinated
loans), mezzanine (a loan that ranks senior only to a borrower’s equity securities and ranks junior to all of such borrower’s
other indebtedness in priority of payment), second lien loans and equity securities to middle market companies that are, in most
cases, sponsored by private equity investors. The Company has entered into an investment advisory agreement (the “Investment
Advisory Agreement”) with GC Advisors LLC (the “Investment Adviser”), under which the Investment Adviser manages
the day-to-day operations of, and provides investment advisory services to, the Company. Prior to April 14, 2010, Golub Capital
Incorporated (the “Investment Manager”) served as the investment adviser for the Company.
Note 2. Accounting Policies and Recent Accounting Updates
Basis of presentation:
The accompanying interim
consolidated financial statements of the Company and related financial information have been prepared in accordance with generally
accepted accounting principles in the United States of America (“GAAP”) for interim financial information and pursuant
to the requirements for reporting on Form 10-Q and Articles 6 or 10 of Regulation S-X. Accordingly, they do not include all of
the information and notes required by GAAP for annual financial statements. In the opinion of management, the consolidated financial
statements reflect all adjustments and reclassifications consisting solely of normal accruals that are necessary for the fair presentation
of financial results as of and for the periods presented. All intercompany balances and transactions have been eliminated. Certain
prior period amounts have been reclassified to conform to the current period presentation.
Fair value of financial instruments:
The
Company applies fair value to all of its financial instruments in accordance with Accounting Standards Codification (“ASC”)
Topic 820 —
Fair Value Measurements and Disclosures.
ASC Topic 820 defines fair value, establishes a framework
used to measure fair value and requires disclosures for fair value measurements. In accordance with ASC Topic 820, the Company
has categorized its financial instruments carried at fair value, based on the priority of the valuation technique, into a three-level
fair value hierarchy. Fair value is a market-based measure considered from the perspective of the market participant who holds
the financial instrument rather than an entity specific measure. Therefore, when market assumptions are not readily available,
the Company’s own assumptions are set to reflect those that management believes market participants would use in pricing
the financial instrument at the measurement date.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
The availability of observable inputs can vary depending on
the financial instrument and is affected by a wide variety of factors, including, for example, the type of product, whether the
product is new, whether the product is traded on an active exchange or in the secondary market and the current market conditions.
To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market the determination
of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is
greatest for financial instruments classified as Level 3.
Any changes to the valuation methodology are reviewed by management
and the Company’s board of directors (the “Board”) to confirm that the changes are justified. As markets change,
new products develop and the pricing for products becomes more or less transparent, the Company will continue to refine its valuation
methodologies.
Use of estimates:
The preparation of the
consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated
financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ
from those estimates.
Consolidation:
As permitted under Regulation
S-X and the American Institute of Certified Public Accountants Audit and Accounting Guide for Investment Companies, the Company
will generally not consolidate its investment in a company other than an investment company subsidiary or a controlled operating
company whose business consists of providing services to the Company. Accordingly, the Company consolidated the results of the
Company’s subsidiaries in its consolidated financial statements.
Assets related to transactions that do not meet ASC Topic 860 —
Transfers and Servicing
requirements for accounting sale treatment are reflected in the Company’s consolidated statements
of financial condition as investments. Those assets are owned by special purpose entities that are consolidated in the Company’s
financial statements. The creditors of the special purpose entities have received security interests in such assets and such assets
are not intended to be available to the creditors of the Company (or any affiliate of the Company).
Cash and cash equivalents:
Cash and cash
equivalents are highly liquid investments with an original maturity of three months or less at the date of acquisition. The Company
deposits its cash in financial institutions and, at times, such balances may be in excess of the Federal Deposit Insurance Corporation
insurance limits.
Restricted cash and cash equivalents:
Restricted
cash and cash equivalents include amounts that are collected and are held by trustees who have been appointed as custodians of
the assets securing certain of the Company’s financing transactions. Restricted cash is held by the trustees for payment
of interest expense and principal on the outstanding borrowings or reinvestment into new assets. In addition, restricted cash and
cash equivalents include amounts held within the Company’s small business investment company (“SBIC”). This amount
is generally restricted to the originations of new loans from the SBIC and the payment of U.S. Small Business Administration (“SBA”)
debentures and related interest expense.
Revenue recognition:
Investments and related investment income:
The
Board determines the fair value of the Company’s investments. Interest income is accrued based upon the outstanding principal
amount and contractual interest terms of debt investments. In addition, the Company may generate revenue in the form of commitment,
origination, amendment, structuring or due diligence fees, fees for providing managerial assistance and consulting fees. Loan origination
fees, original issue discount and market discount or premium are capitalized, and the Company accretes or amortizes such amounts
over the life of the loan as interest income. All other income is recorded into income when earned. The Company records prepayment
premiums on loans as interest income. When the Company receives principal payments on a loan in an amount that exceeds the loan’s
amortized cost, it records the excess principal payment as interest income. For the three and nine months ended June 30, 2012,
interest income included $1,067 and $3,447, respectively, of amortization of discounts. For the three and nine months ended June
30, 2011, interest income included $965 and $4,146, respectively, of amortization of discounts.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
As of June 30, 2012 and September 30, 2011, the Company had
interest receivable of $3,893 and $3,063, respectively. For the three and nine months ended June 30, 2012, the Company earned interest
of $14,811 and $41,263, respectively. For the three and nine months ended June 30, 2011, the Company earned interest of $10,071
and $28,319, respectively. For the three and nine months ended June 30, 2012, the Company received interest in cash, which excludes
income from amortization of loan origination fees, original issue discount and market discount or premium, in the amounts of $13,120
and $35,995, respectively. For the three and nine months ended June 30, 2011, the Company received interest in cash, which excludes
income from amortization of loan origination fees, original issue discount and market discount or premium, in the amounts of $9,410
and $27,086, respectively. For the three and nine months ended June 30, 2012, the Company received loan origination fees of $516
and $6,027, respectively. For the three and nine months ended June 30, 2011, the Company received loan origination fees of $1,941
and $4,740, respectively. These loan origination fees are capitalized and amortized over the life of the loan as interest income.
For investments with contractual PIK interest, which represents
contractual interest accrued and added to the principal balance that generally becomes due at maturity, the Company will not accrue
PIK interest if the portfolio company valuation indicates that the PIK interest is not collectible. For the three and nine months
ended June 30, 2012, the Company recorded PIK income of $634 and $1,545, respectively. For the three and nine months ended June
30, 2011, the Company recorded PIK income of $268 and $615, respectively. For the three and nine months ended June 30, 2012, the
Company received PIK payments in cash of $187 and $554, respectively. For the three and nine months ended June 30, 2011, the Company
received PIK payments in cash of $104 and $269, respectively.
Dividend income on preferred equity securities is recorded as
dividend income on an accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be
collected. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the
ex-dividend date for publicly traded portfolio companies. For the three and nine months ended June 30, 2012, the Company recorded
dividend income of zero and $377, respectively. The Company did not earn dividend income for the three and nine months ended June
30, 2011.
Investment transactions are accounted for on a trade-date basis.
Realized gains or losses on investments are measured by the difference between the net proceeds from the disposition and the cost
basis of investment, without regard to unrealized gains or losses previously recognized. The Company reports current period changes
in fair value of investments that are measured at fair value as a component of the net change in unrealized appreciation (depreciation)
on investments in the consolidated statements of operations.
Non-accrual loans:
A loan may be left on
accrual status during the period the Company is pursuing repayment of the loan. Management reviews all loans that become 90 days
or more past due on principal and interest, or when there is reasonable doubt that principal or interest will be collected, for
possible placement on non-accrual status. When a loan is placed on non-accrual status, unpaid interest credited to income is reversed.
Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s
judgment. Non-accrual loans are restored to accrual status when past due principal and interest is paid and, in management’s
judgment, are likely to remain current. The total fair value of non-accrual loans was $4,243 and $2,891 as of June 30, 2012 and
September 30, 2011, respectively.
Income taxes:
The Company has elected to
be treated as a RIC under Subchapter M of the Code and operates in a manner so as to qualify for the tax treatment applicable to
RICs. In order to qualify as a RIC, among other things, the Company is required to meet certain source of income and asset diversification
requirements and timely distribute to its stockholders at least 90% of investment company taxable income, as defined by the Code,
for each year. The Company has made, and intends to continue to make, the requisite distributions to its stockholders, which will
generally relieve the Company from U.S. federal income taxes with respect to all income distributed to its stockholders.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
Depending on the level of taxable income earned in a tax year,
the Company may choose to carry forward taxable income in excess of current year dividend distributions into the next tax year
and pay a 4% excise tax on such income, as required. To the extent that the Company determines that its estimated current year
annual taxable income will be in excess of estimated current year dividend distributions, the Company accrues excise tax, if any,
on estimated excess taxable income as taxable income is earned. For the three and nine months ended June 30, 2012 and 2011, no
amount was recorded for U.S. federal excise tax.
The Company accounts for income taxes in conformity with ASC
Topic 740 —
Income Taxes
. ASC Topic 740 provides guidelines for how uncertain tax positions should be recognized,
measured, presented and disclosed in financial statements. ASC Topic 740 requires the evaluation of tax positions taken in the
course of preparing the Company’s tax returns to determine whether the tax positions are “more-likely-than-not”
to be sustained by the applicable tax authority. Tax benefits of positions not deemed to meet the more-likely-than-not threshold
would be recorded as a tax expense in the current year. It is the Company’s policy to recognize accrued interest and penalties
related to uncertain tax benefits in income tax expense. There were no material uncertain income tax positions through June 30,
2012. The 2009, 2010 and 2011 tax years remain subject to examination by U.S. federal and most state tax authorities.
Dividends and distributions:
Dividends and
distributions to common stockholders are recorded on the declaration date. The amount to be paid out as a dividend or distribution
is determined by the Board each quarter and is generally based upon the earnings estimated by management. Net realized capital
gains, if any, are distributed at least annually, although the Company may decide to retain such capital gains for investment.
The Company has adopted a dividend reinvestment plan (“DRIP”)
that provides for reinvestment of any distributions the Company declares in cash on behalf of its stockholders, unless a stockholder
elects to receive cash. As a result, if the Board authorizes and the Company declares a cash distribution, then stockholders who
have not “opted out” of the DRIP will have their cash distribution automatically reinvested in additional shares of
the Company’s common stock, rather than receiving the cash dividend. The Company may use newly issued shares under the guidelines
of the DRIP (if the Company’s shares are trading at a premium to net asset value), or the Company may purchase shares in
the open market in connection with the obligations under the plan. In particular, if the Company’s shares are trading at
a significant discount to net asset value and the Company is otherwise permitted under applicable law to purchase such shares,
the Company intends to purchase shares in the open market in connection with any obligations under the DRIP.
On May 3, 2011, the Company’s Board approved an amendment
to the DRIP that, in the event the market price per share of the Company’s common stock on the date of a distribution exceeds
the most recently computed net asset value per share of the common stock, the Company will issue shares of common stock to participants
in the DRIP at the greater of the most recently computed net asset value per share of common stock or 95% of the current market
price per share of common stock (or such lesser discount to the current market price per share that still exceeds the most recently
computed net asset value per share of common stock).
Deferred financing costs:
Deferred financing
costs represent fees and other direct incremental costs incurred in connection with the Company’s borrowings. As of June
30, 2012 and September 30, 2011, the Company had deferred financing costs of $6,082 and $5,345, respectively. These amounts are
amortized and included in interest expense in the consolidated statements of operations over the estimated average life of the
borrowings. Amortization expense for the three and nine months ended June 30, 2012 was $375 and $1,072, respectively. Amortization
expense for the three and nine months ended June 30, 2011 was $202 and $564, respectively.
Deferred offering costs:
Deferred offering
costs consist of fees paid in relation to legal, accounting, regulatory and printing work completed in preparation of equity offerings.
Deferred offering costs are charged against the proceeds from equity offerings when received. As of June 30, 2012 and September
30, 2011, deferred offering costs, which are included in other assets on the consolidated statements of financial condition, were
$53 and $272, respectively.
Accounting for derivative instruments:
The
Company does not utilize hedge accounting and marks its derivatives to market through net change in unrealized appreciation (depreciation)
on derivative instruments in the consolidated statements of operations. For additional information on derivative instruments, refer
to Note 7.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
Note 3. Related Party Transactions
Investment Advisory Agreement:
On April 14,
2010, GBDC entered into the Investment Advisory Agreement with the Investment Adviser, under which the Investment Adviser manages
the day-to-day operations of, and provides investment advisory services to, GBDC. The Investment Advisory Agreement was subsequently
amended on July 16, 2010. The Board reapproved the Investment Advisory Agreement on February 2, 2012. The Investment Adviser is
a registered investment adviser with the Securities and Exchange Commission (the “SEC”). The Investment Adviser receives
fees for providing services, consisting of two components, a base management fee and an Incentive Fee (as defined below).
The base management fee is calculated at an annual rate equal
to 1.375% of average adjusted gross assets at the end of the two most recently completed calendar quarters (including assets purchased
with borrowed funds and securitization-related assets, leverage, unrealized depreciation or appreciation on derivative instruments
and cash collateral on deposit with custodian but adjusted to exclude cash and cash equivalents so that investors do not pay the
base management fee on such assets) and is payable quarterly in arrears. Such amount is adjusted, based on the actual number of
days elapsed relative to the total number of days in such calendar quarter, for any share issuances or repurchases during such
calendar quarter. For purposes of the Investment Advisory Agreement, cash equivalents means U.S. government securities and commercial
paper instruments maturing within 270 days of purchase (which is different than the GAAP definition, which defines cash equivalents
as U.S. government securities and commercial paper instruments maturing within 90 days of purchase). To the extent that the Investment
Adviser or any of its affiliates provides investment advisory, collateral management or other similar services to a subsidiary
of the Company, the base management fee will be reduced by an amount equal to the product of (1) the total fees paid to the Investment
Adviser by such subsidiary for such services and (2) the percentage of such subsidiary’s total equity, including membership
interests and any class of notes not exclusively held by one or more third parties, that is owned, directly or indirectly, by the
Company.
The Company has structured the calculation of the Incentive
Fee to include a fee limitation such that an Incentive Fee for any quarter can only be paid to the Investment Adviser if, after
such payment, the cumulative Incentive Fees paid to the Investment Adviser since the effective date of the Company’s election
to become a BDC would be less than or equal to 20.0% of the Company’s Cumulative Pre-Incentive Fee Net Income (as defined
below).
The Company accomplishes this limitation by subjecting each
quarterly Incentive Fee payable on the “Income and Capital Gain Incentive Fee Calculation” (as defined below) to the
Incentive Fee Cap (as defined below). The Incentive Fee Cap in any quarter is the difference between (a) 20.0% of Cumulative Pre-Incentive
Fee Net Income and (b) cumulative Incentive Fees of any kind paid to the Investment Adviser by GBDC since the effective date of
its election to become a BDC. To the extent the Incentive Fee Cap is zero or a negative value in any quarter, no Incentive Fee
would be payable in that quarter. “Cumulative Pre-Incentive Fee Net Income” is equal to the sum of (a) Pre-Incentive
Fee Net Investment Income for each period since the effective date of the Company’s election to become a BDC and (b) cumulative
aggregate realized capital gains, cumulative aggregate realized capital losses, cumulative aggregate unrealized capital depreciation
and cumulative aggregate unrealized capital appreciation since the effective date of the Company’s election to become a BDC.
“Pre-Incentive Fee Net Investment Income”
means interest income, dividend income and any other income (including any other fees such as commitment, origination, structuring,
diligence and consulting fees or other fees that the Company receives from portfolio companies but excluding fees for providing
managerial assistance) accrued during the calendar quarter, minus operating expenses for the calendar quarter (including the base
management fee, taxes, any expenses payable under the Investment Advisory Agreement and an administration agreement (the “Administration
Agreement”) with GC Service Company, LLC (the “Administrator”), any expenses of securitizations and any interest
expense and dividends paid on any outstanding preferred stock, but excluding the Incentive Fee). Pre-Incentive Fee Net Investment
Income includes, in the case of investments with a deferred interest feature such as market discount, debt instruments with PIK
interest, preferred stock with PIK dividends and zero coupon securities, accrued income that the Company has not yet received in
cash.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
Incentive Fees are calculated and payable quarterly in arrears
(or, upon termination of the Investment Advisory Agreement, as of the termination date) (each, a “Performance Period”).
The Investment Adviser is not under any obligation to reimburse the Company for any part of the Incentive Fee it received that
was based on accrued income that is never actually received.
The income and capital gains incentive fee calculation (the
“Income and Capital Gain Incentive Fee Calculation”) has two parts, the income component (the “Income Incentive
Fee”) and the capital gains component (the “Capital Gain Incentive Fee” and, together with the Income Incentive
Fee, the “Incentive Fee”). The Income Incentive Fee is calculated quarterly in arrears based on the Company’s
Pre-Incentive Fee Net Investment Income for the immediately preceding calendar quarter. As described in Note 7 - Derivative Instruments,
in June 2011, the Company entered into the TRS with Citibank, N.A. (“Citibank”) for the purpose of gaining economic
exposure to a portfolio of broadly syndicated loans. The TRS was subsequently terminated on April 11, 2012. For purposes of the
computation of the Incentive Fee, the Company:
|
·
|
treated the interest spread, which represents the difference between the interest and fees received on the reference assets
underlying the TRS and the interest paid to Citibank on the settled notional value of the TRS, as part of the Income Incentive
Fee; and
|
|
·
|
treated the realized gains and losses on the sale or maturity of reference assets underlying the TRS and futures contracts
as part of the Capital Gain Incentive Fee.
|
For the periods ending September 30, 2011 and prior, the Company
had included interest spread payments from the TRS in the Capital Gain Incentive Fee as this is consistent with GAAP, which records
such payments in net realized gains/(losses) on derivative instruments in the consolidated statement of operations. However, the
Company changed its methodology in the first quarter of fiscal year 2012 pursuant to discussions with the staff of the SEC, resulting
in the TRS interest spread payments being included in the Income Incentive Fee.
For the three and nine months ended June 30, 2012, the Company
received interest spread payments of $990 and $2,560, respectively. For the three months ended December 31, 2011, including the
interest spread payments from the TRS in the Income Incentive Fee caused an increase in the Incentive Fee by $647 as the Company
was in the “catch-up” provision as described below. Upon reviewing the Income and Capital Gain Incentive Fee Calculation
and the treatment of the interest spread payments from the TRS, the Investment Adviser irrevocably waived the incremental portion
of the Incentive Fee attributable from the TRS interest spread payments for the three months ended December 31, 2011. For the three
months ended June 30, 2012, the Income Incentive Fee was $1,917. For the nine months ended June 30, 2012, after taking into account
the waiver by the Investment Adviser, the Income Incentive Fee was $4,261, rather than $4,908. The Income Incentive Fee for the
three and nine months ended June 30, 2011 was zero and $348, respectively.
Pre-Incentive Fee Net Investment Income does not include any
realized capital gains, realized capital losses or unrealized capital appreciation or depreciation. Because of the structure of
the Income Incentive Fee, it is possible that an Incentive Fee may be calculated under this formula with respect to a period in
which the Company has incurred a loss. For example, if the Company receives Pre-Incentive Fee Net Investment Income in excess of
the hurdle rate (as defined below) for a calendar quarter, the Income Incentive Fee will result in a positive value and an Incentive
Fee will be paid unless the payment of such Incentive Fee would cause the Company to pay Incentive Fees on a cumulative basis that
exceed 20.0% of Cumulative Pre-Incentive Fee Net Investment Income. Pre-Incentive Fee Net Investment Income, expressed as a rate
of return on the value of the Company’s net assets (defined as total assets less indebtedness and before taking into account
any Incentive Fees payable during the period) at the end of the immediately preceding calendar quarter, is compared to a fixed
“hurdle rate” of 2.0% quarterly. If market interest rates rise, the Company may be able to invest funds in debt instruments
that provide for a higher return, which would increase Pre-Incentive Fee Net Investment Income and make it easier for the Investment
Adviser to surpass the fixed hurdle rate and receive an Incentive Fee based on such net investment income. The Company’s
Pre-Incentive Fee Net Investment Income used to calculate this part of the Incentive Fee is also included in the amount of its
total assets (other than cash and cash equivalents but including assets purchased with borrowed funds and securitization-related
assets) used to calculate the 1.375% base management fee annual rate.
The Company calculates the Income Incentive Fee with respect
to its Pre-Incentive Fee Net Investment Income quarterly, in arrears, as follows:
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
|
·
|
Zero in any calendar quarter in which the Pre-Incentive Fee Net Investment Income does not exceed the hurdle rate;
|
|
·
|
100% of the Company’s Pre-Incentive Fee Net Investment Income with respect to that portion of such Pre-Incentive Fee
Net Investment Income, if any, that exceeds the hurdle rate but is less than 2.5% in any calendar quarter. This portion of the
Company’s Pre-Incentive Fee Net Investment Income (which exceeds the hurdle rate but is less than 2.5%) is referred to as
the “catch-up” provision. The catch-up is meant to provide the Investment Adviser with 20.0% of the Pre-Incentive Fee
Net Investment Income as if a hurdle rate did not apply if this net investment income exceeds 2.5% in any calendar quarter; and
|
|
·
|
20.0% of the amount of the Company’s Pre-Incentive Fee Net Investment Income, if any, that exceeds 2.5% in any calendar
quarter.
|
The sum of these calculations yields the Income Incentive Fee.
This amount is appropriately adjusted for any share issuances or repurchases during the quarter.
The Capital Gain Incentive Fee equals (a) 20.0% of the Company’s
Capital Gain Incentive Fee Base (as defined below), if any, calculated in arrears as of the end of each calendar year (or upon
termination of the Investment Advisory Agreement, as of the termination date), which commenced with the calendar year ending December
31, 2010, less (b) the aggregate amount of any previously paid Capital Gain Incentive Fees. The Company’s “Capital
Gain Incentive Fee Base” equals the sum of (1) realized capital gains, if any, on a cumulative positive basis from the date
the Company elected to become a BDC through the end of each calendar year, (2) all realized capital losses on a cumulative basis
and (3) all unrealized capital depreciation on a cumulative basis.
|
·
|
The cumulative aggregate realized capital losses are calculated as the sum of the amounts by which (a) the net sales price
of each investment in the Company’s portfolio when sold is less than (b) the accreted or amortized cost base of such investment.
|
|
·
|
The cumulative aggregate realized capital gains are calculated as the sum of the differences, if positive, between (a) the
net sales price of each investment in the Company’s portfolio when sold and (b) the accreted or amortized cost basis of such
investment.
|
|
·
|
The aggregate unrealized capital depreciation is calculated as the sum of the differences, if negative, between (a) the valuation
of each investment in the Company’s portfolio as of the applicable Capital Gain Incentive Fee calculation date and (b) the
accreted or amortized cost basis of such investment.
|
The Company accrues the Capital Gain Incentive Fee if, on a
cumulative basis, the sum of net realized gains/(losses) plus net unrealized appreciation/(depreciation) is positive. The Capital
Gain Incentive Fee is calculated on a cumulative basis from the date the Company elected to become a BDC through the end of each
calendar year. For the three and nine months ended June 30, 2012, the Capital Gain Incentive Fee was zero. For the three and nine
months ended June 30, 2011, the Company accrued a Capital Gain Incentive Fee of $113 and $177, respectively.
As described above, the Incentive Fee will not be paid at any
time if, after such payment, the cumulative Incentive Fees paid to date would be greater than 20.0% of the Company’s Cumulative
Pre-Incentive Fee Net Investment Income since the effective date of the Company’s election to be treated as a BDC. Such amount,
less any Incentive Fees previously paid, is referred to as the “Incentive Fee Cap.” If, for any relevant period, the
Incentive Fee Cap calculation results in the Company paying less than the amount of the Incentive Fee calculated above, then the
difference between the Incentive Fee and the Incentive Fee Cap will not be paid by GBDC and will not be received by the Investment
Adviser as an Incentive Fee either at the end of such relevant period or at the end of any future period.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
Administration Agreement:
GBDC has also entered
into the Administration Agreement. Under the Administration Agreement, the Administrator furnishes GBDC with office facilities
and equipment, provides GBDC with clerical, bookkeeping and record keeping services at such facilities and provides GBDC with other
administrative services as the Administrator, subject to review by the Board, determines necessary to conduct GBDC’s day-to-day
operations. GBDC reimburses the Administrator the allocable portion (subject to the review and approval of the Board) of overhead
and other expenses incurred by it in performing its obligations under the Administration Agreement, including rent, fees and expenses
associated with performing compliance functions and GBDC’s allocable portion of the cost of its chief financial officer and
chief compliance officer and their respective staffs. As permitted by the Administration Agreement, beginning January 1, 2012,
the Administrator began charging the allocable portion of the cost of the Company’s chief compliance officer and chief financial
officer and their respective staffs to the Company. The Board reviews such expenses to determine that these expenses are reasonable
and comparable to administrative services charged by unaffiliated third party asset managers. Under the Administration Agreement,
the Administrator also provides on the Company’s behalf significant managerial assistance to those portfolio companies to
which GBDC is required to provide such assistance and will be paid an additional amount based on the services provided, not to
exceed the amount GBDC receives from such portfolio companies.
Included in accounts payable and accrued expenses is $489 and
$226 as of June 30, 2012 and September 30, 2011, respectively, for accrued allocated shared services under the Administration Agreement.
The administrative service fee expense under the Administration Agreement for the three and nine months ended June 30, 2012 was
$489 and $1,207, respectively. The administrative service fee expense under the Administration Agreement for the three and nine
months ended June 30, 2011 was $224 and $611, respectively.
Other related party transactions:
The Investment
Manager pays for certain unaffiliated third-party expenses incurred by the Company. Such expenses include postage, printing, office
supplies and rating agency fees. These expenses are not marked-up and represent the same amount the Company would have paid had
the Company paid the expenses directly. These expenses are subsequently reimbursed in cash.
Total expenses reimbursed to the Investment Manager during the
three and nine months ended June 30, 2012 were $90 and $289, respectively. Total expenses reimbursed to the Investment Manager
during the three and nine months ended June 30, 2011 were $68 and $266, respectively.
As of June 30, 2012 and September 30, 2011, included in accounts
payable and accrued expenses were $47 and $65, respectively, for accrued expenses paid on behalf of the Company by the Investment
Manager.
Note 4. Investments
Investments consisted of the following:
|
|
June 30, 2012
|
|
|
September 30, 2011
|
|
|
|
Par
|
|
|
Cost
|
|
|
Fair Value
|
|
|
Par
|
|
|
Cost
|
|
|
Fair Value
|
|
Senior secured
|
|
$
|
265,578
|
|
|
$
|
261,123
|
|
|
$
|
258,751
|
|
|
$
|
212,725
|
|
|
$
|
209,729
|
|
|
$
|
203,831
|
|
One stop
|
|
|
237,506
|
|
|
|
233,973
|
|
|
|
236,827
|
|
|
|
178,854
|
|
|
|
176,393
|
|
|
|
177,880
|
|
Second lien
(1)
|
|
|
48,783
|
|
|
|
47,157
|
|
|
|
48,448
|
|
|
|
21,922
|
|
|
|
21,531
|
|
|
|
21,922
|
|
Subordinated debt
|
|
|
75,892
|
|
|
|
74,658
|
|
|
|
74,614
|
|
|
|
46,804
|
|
|
|
45,888
|
|
|
|
46,804
|
|
Equity
|
|
|
N/A
|
|
|
|
18,341
|
|
|
|
17,992
|
|
|
|
N/A
|
|
|
|
9,420
|
|
|
|
9,390
|
|
Derivative instruments
(2)
|
|
|
N/A
|
|
|
|
-
|
|
|
|
149
|
|
|
|
N/A
|
|
|
|
-
|
|
|
|
(1,986
|
)
|
Total
|
|
$
|
627,759
|
|
|
$
|
635,252
|
|
|
$
|
636,781
|
|
|
$
|
460,305
|
|
|
$
|
462,961
|
|
|
$
|
457,841
|
|
(1)
Second lien loans include loans structured as
first lien last out term loans.
(2)
Refer to Note 7 for additional disclosures.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
The Company has invested in portfolio companies located in the
United States and in Canada. The following tables, which exclude derivative instruments, show the portfolio composition by geographic
region at cost and fair value as a percentage of total investments in portfolio companies. The geographic composition is determined
by the location of the corporate headquarters of the portfolio company, which may not be indicative of the primary source of the
portfolio company’s business.
|
|
June 30, 2012
|
|
|
September 30, 2011
|
|
Cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mid-Atlantic
|
|
$
|
61,844
|
|
|
|
9.8
|
%
|
|
$
|
66,782
|
|
|
|
14.4
|
%
|
Midwest
|
|
|
131,091
|
|
|
|
20.6
|
|
|
|
112,550
|
|
|
|
24.3
|
|
West
|
|
|
133,590
|
|
|
|
21.0
|
|
|
|
80,242
|
|
|
|
17.3
|
|
Southeast
|
|
|
170,962
|
|
|
|
26.9
|
|
|
|
89,133
|
|
|
|
19.3
|
|
Southwest
|
|
|
85,333
|
|
|
|
13.4
|
|
|
|
74,907
|
|
|
|
16.2
|
|
Northeast
|
|
|
49,233
|
|
|
|
7.8
|
|
|
|
36,599
|
|
|
|
7.9
|
|
Canada
|
|
|
3,199
|
|
|
|
0.5
|
|
|
|
2,748
|
|
|
|
0.6
|
|
Total
|
|
$
|
635,252
|
|
|
|
100.0
|
%
|
|
$
|
462,961
|
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mid-Atlantic
|
|
$
|
58,570
|
|
|
|
9.2
|
%
|
|
$
|
66,906
|
|
|
|
14.5
|
%
|
Midwest
|
|
|
131,125
|
|
|
|
20.6
|
|
|
|
112,534
|
|
|
|
24.5
|
|
West
|
|
|
135,005
|
|
|
|
21.2
|
|
|
|
78,329
|
|
|
|
17.0
|
|
Southeast
|
|
|
173,478
|
|
|
|
27.2
|
|
|
|
89,735
|
|
|
|
19.5
|
|
Southwest
|
|
|
86,624
|
|
|
|
13.6
|
|
|
|
72,467
|
|
|
|
15.8
|
|
Northeast
|
|
|
50,006
|
|
|
|
7.9
|
|
|
|
37,057
|
|
|
|
8.1
|
|
Canada
|
|
|
1,824
|
|
|
|
0.3
|
|
|
|
2,799
|
|
|
|
0.6
|
|
Total
|
|
$
|
636,632
|
|
|
|
100.0
|
%
|
|
$
|
459,827
|
|
|
|
100.0
|
%
|
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
The industry compositions of the portfolio at fair value, excluding
derivative instruments, were as follows:
|
|
June 30, 2012
|
|
|
September 30, 2011
|
|
Cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aerospace and Defense
|
|
$
|
2,517
|
|
|
|
0.4
|
%
|
|
$
|
2,513
|
|
|
|
0.5
|
%
|
Automobile
|
|
|
24,250
|
|
|
|
3.8
|
|
|
|
8,255
|
|
|
|
1.8
|
|
Banking
|
|
|
1,318
|
|
|
|
0.2
|
|
|
|
1,237
|
|
|
|
0.3
|
|
Beverage, Food and Tobacco
|
|
|
53,399
|
|
|
|
8.4
|
|
|
|
31,467
|
|
|
|
6.8
|
|
Broadcasting and Entertainment
|
|
|
4,960
|
|
|
|
0.8
|
|
|
|
-
|
|
|
|
-
|
|
Buildings and Real Estate
|
|
|
6,820
|
|
|
|
1.1
|
|
|
|
24,522
|
|
|
|
5.3
|
|
Cargo Transport
|
|
|
1,837
|
|
|
|
0.3
|
|
|
|
2,137
|
|
|
|
0.4
|
|
Chemicals, Plastics and Rubber
|
|
|
6,762
|
|
|
|
1.0
|
|
|
|
13,868
|
|
|
|
3.0
|
|
Containers, Packaging and Glass
|
|
|
4,478
|
|
|
|
0.7
|
|
|
|
4,725
|
|
|
|
1.0
|
|
Diversified Conglomerate Manufacturing
|
|
|
30,556
|
|
|
|
4.8
|
|
|
|
28,550
|
|
|
|
6.2
|
|
Diversified Conglomerate Service
|
|
|
88,160
|
|
|
|
13.9
|
|
|
|
50,904
|
|
|
|
11.0
|
|
Diversified Natural Resources, Precious Metals and Minerals
|
|
|
4,529
|
|
|
|
0.7
|
|
|
|
4,753
|
|
|
|
1.0
|
|
Electronics
|
|
|
63,919
|
|
|
|
10.0
|
|
|
|
36,293
|
|
|
|
7.8
|
|
Farming and Agriculture
|
|
|
2,819
|
|
|
|
0.4
|
|
|
|
2,931
|
|
|
|
0.6
|
|
Finance
|
|
|
7,095
|
|
|
|
1.1
|
|
|
|
7,145
|
|
|
|
1.5
|
|
Healthcare, Education and Childcare
|
|
|
115,455
|
|
|
|
18.2
|
|
|
|
88,436
|
|
|
|
19.1
|
|
Home and Office Furnishings, Housewares and Durable Consumer
|
|
|
6,365
|
|
|
|
1.0
|
|
|
|
11,490
|
|
|
|
2.5
|
|
Leisure, Amusement, Motion Pictures and Entertainment
|
|
|
33,233
|
|
|
|
5.2
|
|
|
|
22,772
|
|
|
|
4.9
|
|
Oil and Gas
|
|
|
-
|
|
|
|
-
|
|
|
|
16,460
|
|
|
|
3.6
|
|
Personal and Non-Durable Consumer Products
|
|
|
20,754
|
|
|
|
3.3
|
|
|
|
22,752
|
|
|
|
4.9
|
|
Personal, Food and Miscellaneous Services
|
|
|
39,705
|
|
|
|
6.3
|
|
|
|
19,247
|
|
|
|
4.2
|
|
Personal Transportation
|
|
|
12,533
|
|
|
|
2.0
|
|
|
|
-
|
|
|
|
-
|
|
Printing and Publishing
|
|
|
13,857
|
|
|
|
2.2
|
|
|
|
14,643
|
|
|
|
3.2
|
|
Retail Stores
|
|
|
81,830
|
|
|
|
12.9
|
|
|
|
43,454
|
|
|
|
9.4
|
|
Telecommunications
|
|
|
3,000
|
|
|
|
0.5
|
|
|
|
4,407
|
|
|
|
1.0
|
|
Utilities
|
|
|
5,101
|
|
|
|
0.8
|
|
|
|
-
|
|
|
|
-
|
|
Total
|
|
$
|
635,252
|
|
|
|
100.0
|
%
|
|
$
|
462,961
|
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aerospace and Defense
|
|
$
|
2,664
|
|
|
|
0.4
|
%
|
|
$
|
2,664
|
|
|
|
0.6
|
%
|
Automobile
|
|
|
24,477
|
|
|
|
3.9
|
|
|
|
8,096
|
|
|
|
1.8
|
|
Banking
|
|
|
497
|
|
|
|
0.1
|
|
|
|
928
|
|
|
|
0.2
|
|
Beverage, Food and Tobacco
|
|
|
54,260
|
|
|
|
8.5
|
|
|
|
31,790
|
|
|
|
6.9
|
|
Broadcasting and Entertainment
|
|
|
4,919
|
|
|
|
0.8
|
|
|
|
-
|
|
|
|
-
|
|
Buildings and Real Estate
|
|
|
5,683
|
|
|
|
0.9
|
|
|
|
20,924
|
|
|
|
4.6
|
|
Cargo Transport
|
|
|
1,859
|
|
|
|
0.3
|
|
|
|
2,102
|
|
|
|
0.5
|
|
Chemicals, Plastics and Rubber
|
|
|
6,815
|
|
|
|
1.1
|
|
|
|
13,990
|
|
|
|
3.0
|
|
Containers, Packaging and Glass
|
|
|
4,540
|
|
|
|
0.7
|
|
|
|
4,803
|
|
|
|
1.0
|
|
Diversified Conglomerate Manufacturing
|
|
|
31,173
|
|
|
|
4.9
|
|
|
|
28,335
|
|
|
|
6.2
|
|
Diversified Conglomerate Service
|
|
|
89,474
|
|
|
|
14.1
|
|
|
|
51,332
|
|
|
|
11.2
|
|
Diversified Natural Resources, Precious Metals and Minerals
|
|
|
4,653
|
|
|
|
0.7
|
|
|
|
4,881
|
|
|
|
1.1
|
|
Electronics
|
|
|
65,020
|
|
|
|
10.2
|
|
|
|
36,614
|
|
|
|
8.0
|
|
Farming and Agriculture
|
|
|
2,853
|
|
|
|
0.4
|
|
|
|
2,972
|
|
|
|
0.6
|
|
Finance
|
|
|
3,406
|
|
|
|
0.5
|
|
|
|
6,784
|
|
|
|
1.5
|
|
Healthcare, Education and Childcare
|
|
|
117,162
|
|
|
|
18.4
|
|
|
|
86,523
|
|
|
|
18.8
|
|
Home and Office Furnishings, Housewares and Durable Consumer
|
|
|
6,326
|
|
|
|
1.0
|
|
|
|
11,536
|
|
|
|
2.5
|
|
Leisure, Amusement, Motion Pictures and Entertainment
|
|
|
32,482
|
|
|
|
5.1
|
|
|
|
23,178
|
|
|
|
5.0
|
|
Oil and Gas
|
|
|
-
|
|
|
|
-
|
|
|
|
16,737
|
|
|
|
3.6
|
|
Personal and Non-Durable Consumer Products
|
|
|
20,640
|
|
|
|
3.2
|
|
|
|
22,880
|
|
|
|
5.0
|
|
Personal, Food and Miscellaneous Services
|
|
|
39,993
|
|
|
|
6.3
|
|
|
|
19,377
|
|
|
|
4.2
|
|
Personal Transportation
|
|
|
12,774
|
|
|
|
2.0
|
|
|
|
-
|
|
|
|
-
|
|
Printing and Publishing
|
|
|
14,038
|
|
|
|
2.2
|
|
|
|
14,875
|
|
|
|
3.2
|
|
Retail Stores
|
|
|
82,867
|
|
|
|
13.0
|
|
|
|
44,153
|
|
|
|
9.6
|
|
Telecommunications
|
|
|
2,881
|
|
|
|
0.5
|
|
|
|
4,353
|
|
|
|
0.9
|
|
Utilities
|
|
|
5,176
|
|
|
|
0.8
|
|
|
|
-
|
|
|
|
-
|
|
Total
|
|
$
|
636,632
|
|
|
|
100.0
|
%
|
|
$
|
459,827
|
|
|
|
100.0
|
%
|
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
Note 5. Fair Value Measurements
The Company follows ASC Topic 820 for measuring fair value.
Fair value is the price that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. Where available, fair value is based on observable market prices or parameters,
or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These
valuation models involve some level of management estimation and judgment, the degree of which is dependent on the price transparency
for the assets or liabilities or market and the assets’ or liabilities’ complexity. The Company’s fair value
analysis includes an analysis of the value of any unfunded loan commitments. Assets and liabilities are categorized for disclosure
purposes based upon the level of judgment associated with the inputs used to measure their value. The valuation hierarchical levels
are based upon the transparency of the inputs to the valuation of the asset or labiality as of the measurement date. The three
levels are defined as follows:
Level 1:
Inputs are unadjusted,
quoted prices in active markets for identical assets or liabilities at the measurement date.
Level 2:
Inputs include quoted
prices for similar assets or liabilities in active markets and inputs that are observable for the assets or liabilities, either
directly or indirectly, for substantially the full term of the assets or liabilities.
Level 3:
Inputs include significant
unobservable inputs for the assets or liabilities and include situations where there is little, if any, market activity for the
assets or liabilities. The inputs into the determination of fair value are based upon the best information available and may require
significant management judgment or estimation.
In certain cases, the inputs used to measure fair value may
fall into different levels of the fair value hierarchy. In such cases, an asset’s or a liability’s categorization within
the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’s
assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers
factors specific to the asset or liability. The Company assesses the levels of investments at each measurement date, and transfers
between levels are recognized on the actual date of the event or change in circumstances that caused the transfers. There were
no transfers among level 1, 2 and 3 investments during the nine months ended June 30, 2012 and 2011. The following section describes
the valuation techniques used by the Company to measure different assets and liabilities at fair value and includes the level within
the fair value hierarchy in which the assets and liabilities are categorized.
Cash and cash equivalents held at large financial institutions
and futures contracts that are valued based on quoted market prices in active markets are categorized in Level 1 of the fair value
hierarchy. All other assets and liabilities as of June 30, 2012 and September 30, 2011 were valued using Level 3 inputs of the
fair value hierarchy. Level 1 assets and liabilities are valued using quoted market prices. Level 2 assets and liabilities are
valued using market consensus prices that are corroborated by observable market data and quoted market prices for similar assets
and liabilities. Level 3 assets and liabilities are valued at fair value as determined in good faith by the Board, based on input
of management, the audit committee and independent valuation firms that have been engaged at the direction of the Board to assist
in the valuation of each portfolio investment without a readily available market quotation at least once during a trailing twelve-month
period under a valuation policy and a consistently applied valuation process. This valuation process is conducted at the end of
each fiscal quarter, with approximately 25% (based on fair value) of the Company’s valuation of debt and equity securities
without readily available market quotations subject to review by an independent valuation firm.
When valuing Level 3 debt and equity investments, the Company
may take into account the following factors, where relevant, in determining the fair value of the investments: the enterprise value
of a portfolio company, the nature and realizable valuable of any collateral, the portfolio company’s ability to make payments
and its earnings and discounted cash flows, the markets in which the portfolio company does business, comparisons to publicly traded
securities, changes in the interest rate environment and the credit markets generally that may affect the price at which similar
investments may be made and other relevant factors. In addition, for certain debt and equity investments, the Company may base
its valuation on indicative bid and ask prices provided by an independent third party pricing service. Bid prices reflect the highest
price that the Company and others may be willing to pay. Ask prices represent the lowest price that the Company and others may
be willing to accept for an investment. The Company generally uses the midpoint of the bid/ask range as its best estimate of fair
value of such investment.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
On April 11, 2012, the Company terminated its TRS with Citibank.
As of June 30, 2012, the Company had a receivable of $74 for accrued interest from the TRS, which will be paid in September 2012.
As of September 30, 2011, the TRS had a value of $(141). The referenced portfolio of loans of the TRS were valued by Citibank.
Citibank based its valuation on the indicative bid prices provided by an independent third party pricing service. Bid prices reflect
the highest price that market participants may be willing to pay. These valuations were sent to the Company and its Board for review
and testing. The Board reviewed and approved the value of the TRS, as well as the value of the loans underlying the TRS, on a quarterly
basis as part of its quarterly determination of net asset value. For additional disclosures on the Company’s TRS, refer to
Note 7 — Derivative Instruments.
Fair value of the Company’s debt is estimated by discounting
remaining payments using applicable market rates or market quotes for similar instruments at the measurement date, if available.
ASC Topic 820 requires disclosure of the fair value of financial
instruments for which it is practical to estimate such value. As a result, with the exception of the line item titled “debt”
which is reported at cost, all assets and liabilities approximate fair value on the consolidated statements of financial condition
due to their short maturity.
Due to the inherent uncertainty of determining the fair value
of Level 3 assets and liabilities that do not have a readily available market value, the fair value of the assets and liabilities
may differ significantly from the values that would have been used had a ready market existed for such assets and liabilities and
may differ materially from the values that may ultimately be received or settled. Further, such assets and liabilities are generally
subject to legal and other restrictions or otherwise are less liquid than publicly traded instruments. If the Company were required
to liquidate a portfolio investment in a forced or liquidation sale, the Company may realize significantly less than the value
at which such investment had previously been recorded.
The Company’s investments, borrowings and derivatives
are subject to market risk. Market risk is the potential for changes in the value due to market changes. Market risk is directly
impacted by the volatility and liquidity in the markets in which the investments, borrowings and derivatives are traded.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
The following table presents fair value measurements of the
Company’s investments and derivative instruments and indicates the fair value hierarchy of the valuation techniques utilized
by the Company to determine such fair value:
As of June 30, 2012:
|
|
Fair Value Measurements Using
|
|
Description
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt investments
(1)
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
618,640
|
|
|
$
|
618,640
|
|
Equity investments
(1)
|
|
|
-
|
|
|
|
-
|
|
|
|
17,992
|
|
|
|
17,992
|
|
Derivative instruments
(2)
|
|
|
75
|
|
|
|
-
|
|
|
|
74
|
|
|
|
149
|
|
Cash and cash equivalents
|
|
|
63,129
|
|
|
|
-
|
|
|
|
-
|
|
|
|
63,129
|
|
|
|
$
|
63,204
|
|
|
$
|
-
|
|
|
$
|
636,706
|
|
|
$
|
699,910
|
|
As of September 30, 2011:
|
|
Fair Value Measurements Using
|
|
Description
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt investments
(1)
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
450,437
|
|
|
$
|
450,437
|
|
Equity investments
(1)
|
|
|
-
|
|
|
|
-
|
|
|
|
9,390
|
|
|
|
9,390
|
|
Derivative instruments
(2)
|
|
|
(141
|
)
|
|
|
-
|
|
|
|
(1,845
|
)
|
|
|
(1,986
|
)
|
Cash and cash equivalents
|
|
|
69,766
|
|
|
|
-
|
|
|
|
-
|
|
|
|
69,766
|
|
|
|
$
|
69,625
|
|
|
$
|
-
|
|
|
$
|
457,982
|
|
|
$
|
527,607
|
|
(1)
Refer to the consolidated schedule of investments
for further details.
(2)
Derivative instruments include futures contracts
and the TRS. Refer to Note 7 for additional disclosures.
The net change in unrealized appreciation for the three and
nine months ended June 30, 2012 reported within the net change in unrealized appreciation (depreciation) on investments and the
net change in unrealized appreciation (depreciation) on derivative instruments in the Company’s consolidated statements of
operation attributable to the Company’s Level 3 assets was $2,200 and $5,499, respectively. The net change in unrealized
appreciation (depreciation) reported within the net change in unrealized appreciation (depreciation) on investments and the net
change in unrealized appreciation (depreciation) on derivative instruments in the Company’s consolidated statements of operation
attributable to the Company’s Level 3 assets for the three and nine months ended June 30, 2011 was $497 and $(4), respectively.
Golub Capital BDC, Inc. and Subsidiaries
|
Notes to Unaudited Consolidated Financial Statements
|
(In thousands, except shares and per share data)
|
|
The following table presents the changes in investments measured
at fair value using Level 3 inputs:
|
|
Nine months ended June
30, 2012
|
|
|
|
Debt Investments
|
|
|
Equity Investments
|
|
|
Derivative Instruments
(1)
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair value, beginning of period
|
|
$
|
450,437
|
|
|
$
|
9,390
|
|
|
$
|
(1,845
|
)
|
|
$
|
457,982
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in unrealized appreciation (depreciation) on investments and derivative instruments
|
|
|
3,428
|
|
|
|
152
|
|
|
|
1,919
|
|
|
|
5,499
|
|
Realized (loss) gain on investments and derivative instruments
|
|
|
(5,003
|
)
|
|
|
1
|
|
|
|
3,779
|
|
|
|
(1,223
|
)
|
Fundings of revolving loans, net
|
|
|
2,438
|
|
|
|
-
|
|
|
|
-
|
|
|
|
2,438
|
|
Fundings of investments
|
|
|
284,429
|
|
|
|
8,515
|
|
|
|
-
|
|
|
|
292,944
|
|
Proceeds from principal payments and sales of portfolio investments
|
|
|
(120,536
|
)
|
|
|
(66
|
)
|
|
|
-
|
|
|
|
(120,602
|
)
|
Proceeds from derivative instruments
(1)
|
|
|
-
|
|
|
|
-
|
|
|
|
(3,779
|
)
|
|
|
(3,779
|
)
|
Amortization of discount and premium
|
|
|
3,447
|
|
|
|
-
|
|
|
|
-
|
|
|
|
3,447
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair value, end of period
|
|
$
|
618,640
|
|
|
$
|
17,992
|
|
|
$
|
74
|
|
|
$
|
636,706
|
|
(1)
Refer to Note 7 for additional disclosures.
The following table presents quantitative information about
the significant unobservable inputs of the Company’s level 3 investments as of June 30, 2012. The below table is not intended
to be all-inclusive, but rather to provide information on significant unobservable inputs and valuation techniques used by the
Company.
Quantitative information about Level 3 Fair Value Measurements
|
|
|
|
Fair value at June
30, 2012
|
|
|
Valuation Techniques
|
|
|
Unobservable Input
|
|
|
Range (Weighted Average)
|
|
Senior secured loans
(1)(2)
|
|
$
|
195,258
|
|
|
|
Market comparable companies Market rate approach
|
|
|
|
EBITDA multiples market interest rate
|
|
|
|
5.0 - 13.5 (6.2)
2.7% - 16.0% (5.7%)
|
|
One stop loans
|
|
$
|
236,827
|
|
|
|
Market comparable companies Market rate approach
|
|
|
|
EBITDA multiples market interest rate
|
|
|
|
4.7 - 13.0 (8.3)
5.2% - 14.5% (8.9%)
|
|
Subordinated and second lien loans
(3)(4)
|
|
$
|
109,639
|
|
|
|
Market comparable companies Market rate approach
|
|
|
|
EBITDA multiples market interest rate
|
|
|
|
6.5 - 11.0 (7.5)
8.0% - 21.0% (11.6%)
|
|
Equity securities
|
|
$
|
17,992
|
|
|
|
Market comparable companies
|
|
|
|
EBITDA multiples
|
|
|
|
5.5 - 13.0 (8.7)
|
|
(1)
Excludes $60,685 of loans at fair value, which
the Company values using indicative bid and ask prices provided by an independent third party pricing service.
(2)
Excludes $2,808 of non-accrual loans at fair
value. These loans were valued on a liquidation basis.
(3)
Excludes $11,988 of loans at fair value, which
the Company values using indicative bid and ask prices provided by an independent third party pricing service.
(4)
Excludes $1,435 of non-accrual loans at fair
value. These loans were valued on a liquidation basis.
The significant unobservable inputs used in the fair value measurement
of the Company’s debt and equity securities are earnings before interest, taxes, depreciation and amortization (“EBITDA”)
multiples and market interest rates. The Company uses EBITDA multiples on its loans and equity securities to determine any credit
gains or losses. Significant increases or decreases in either of these inputs in isolation would result in a significantly lower
or higher fair value measurement. The Company uses market interest rates for loans to determine if the effective yield on a loan
is commensurate with the market yields for that type of loan. If a loan’s effective yield is significantly less than the
market yield for a similar loan with a similar credit profile, then the resulting fair value of the loan may be lower.
Golub Capital BDC, Inc. and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
(In thousands, except shares
and per share data)
The following are the carrying values and fair values
of the Company’s debt liabilities as of June 30, 2012 and September 30, 2011.
|
|
As of June 30, 2012
|
|
|
As of September 30, 2011
|
|
|
|
Carrying Value
|
|
|
Fair Value
|
|
|
Carrying Value
|
|
|
Fair Value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt
|
|
$
|
329,800
|
|
|
$
|
333,194
|
|
|
$
|
237,683
|
|
|
$
|
240,373
|
|
Note 6. Borrowings
In accordance with the 1940 Act, with certain limited exceptions,
the Company is only allowed to borrow amounts such that its asset coverage, as defined in the 1940 Act, is at least 200% after
such borrowing. On September 13, 2011, the Company received exemptive relief from the SEC allowing it to modify the asset coverage
requirement to exclude the SBA debentures from this calculation. As such, the Company’s ratio of total consolidated assets
to outstanding indebtedness may be less than 200%. This provides the Company with increased investment flexibility but also increases
its risks related to leverage. As of June 30, 2012, the Company’s asset coverage for borrowed amounts was 282.1%.
Debt Securitization:
On July 16, 2010, the
Company completed a $300,000 term debt securitization (“Debt Securitization”). The notes (“Notes”) offered
in the Debt Securitization were issued by Golub Capital BDC 2010-1 LLC (the “Issuer”), a subsidiary of Golub Capital
BDC 2010-1 Holdings LLC (“Holdings”), a direct subsidiary of the Company, and the Class A Notes and Class B Notes are
secured by the assets held by the Issuer. The Debt Securitization was executed through a private placement of $174,000 of Aaa/AAA
Class A Notes of the Issuer which bear interest at three-month LIBOR plus 2.40%. The $10,000 face amount of Class B Notes bears
interest at a rate of three-month LIBOR plus 2.40%, and the $116,000 face amount of Subordinated Notes does not bear interest.
The Class A Notes are included in the June 30, 2012 and September 30, 2011 consolidated statements of financial condition. In partial
consideration for the loans transferred to the Issuer as part of the Debt Securitization, Holdings retained all of the Class B
and Subordinated Notes totaling $10,000 and $116,000, respectively, and all of the membership interests in the Issuer, which Holdings
initially purchased for two hundred and fifty dollars.
During a period of up to three years from the closing date (which
may be extended for two additional years, upon satisfaction of certain conditions), all principal collections received on the underlying
collateral may be used by the Issuer to purchase new collateral under the direction of the Investment Adviser in its capacity as
collateral manager of the Issuer and in accordance with the Company’s investment strategy, allowing the Company to maintain
the initial leverage in the Debt Securitization for such three-year period. The Notes are scheduled to mature on July 20, 2021.
The proceeds of the private placement of the Notes, net of expenses,
were used to repay and terminate the Company’s prior credit facility, which was a $300,000 credit facility entered into on
July 27, 2007. As part of the Debt Securitization, the Company entered into a master loan sale agreement with Holdings and the
Issuer under which the Company agreed to sell or contribute certain senior secured and second lien loans (or participation interests
therein) to Holdings, and Holdings agreed to sell or contribute such loans (or participation interests therein) to the Issuer and
to purchase or otherwise acquire subordinated notes issued by the Issuer. The Notes are the secured obligations of the Issuer,
and an indenture governing the Notes includes customary covenants and events of default.
The Investment Adviser serves as collateral manager to the Issuer
under a collateral management agreement and receives a fee for providing these services. As a result, the Company has amended and
restated its Investment Advisory Agreement to provide that the base management fee payable under such agreement is reduced by an
amount equal to the total fees that are paid to the Investment Adviser by the Issuer for rendering such collateral management services.
As of June 30, 2012 and September 30, 2011, there were 81 and
79 portfolio companies with a total fair value of $286,055 and $284,288, respectively, securing the Notes. The pool of loans in
the Debt Securitization must meet certain requirements, including asset mix and concentration, collateral coverage, term, agency
rating, minimum coupon, minimum spread and sector diversity requirements.
Golub Capital BDC, Inc. and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
(In thousands, except shares
and per share data)
The interest charged under the Debt Securitization is based
on three-month LIBOR, which as of June 30, 2012 was 0.5%. For the three and nine months ended June 30, 2012, the effective annualized
average interest rate, which includes amortization of debt issuance costs on the Debt Securitization, was 3.3% and 3.3%, respectively.
For the three and nine months ended June 30, 2012, interest expense was $1,269 and $3,792, respectively. Cash paid for
interest during the three and nine months ended June 30, 2012 was $1,303 and $3,730, respectively. For the three and nine months
ended June 30, 2011, the effective annualized average interest rate, which includes amortization of debt issuance costs on the
Debt Securitization, was 3.1% and 3.3%, respectively. For the three and nine months ended June 30, 2011, interest expense
was $1,179 and $3,789, respectively. Cash paid for interest during the three and nine months ended June 30, 2011 was
$1,176 and $4,025, respectively.
The classes, amounts, ratings and interest rates (expressed
as a spread to LIBOR) of the Class A Notes are as follows:
Description
|
|
Class A Notes
|
|
|
|
Type
|
|
Senior Secured Floating Rate
|
Amount Outstanding
|
|
$174,000
|
Moody's Rating
|
|
"Aaa"
|
S&P Rating
|
|
"AAA"
|
Interest Rate
|
|
LIBOR + 2.40%
|
Stated Maturity
|
|
July 20, 2021
|
SBA Debentures:
On August 24, 2010, GC SBIC
IV, L.P., a wholly owned subsidiary of the Company, received approval for a license from the SBA to operate as an SBIC. As an SBIC,
GC SBIC IV, L.P. is subject to a variety of regulations and oversight by the SBA concerning the size and nature of the companies
in which it may invest as well as the structures of those investments.
The license allows GC SBIC IV, L.P. to obtain leverage by issuing
SBA-guaranteed debentures, subject to issuance of a capital commitment by the SBA and customary procedures. These debentures are
non-recourse to the Company, have interest payable semiannually and a ten-year maturity. The interest rate is fixed at the time
of issuance at a market-driven spread over U.S. Treasury Notes with ten-year maturities.
Under present SBIC regulations, the maximum amount of SBA-guaranteed
debentures that may be issued by multiple licensees under common management is $225,000. An affiliate of the Investment Adviser
manages another SBIC. As such, it is possible that GC SBIC IV, L.P. will be constrained in its ability to issue SBA-guaranteed
debentures in the future if the other affiliated SBIC has already issued such debentures. As of June 30, 2012, the affiliated SBIC
licensee had $90,720 of SBA-guaranteed debentures outstanding, while GC SBIC IV, L.P. had $123,500 of outstanding SBA-guaranteed
debentures. This leaves incremental borrowing capacity of a maximum of $10,780 of SBA-guaranteed debentures for GC SBIC IV, L.P.
and the affiliated SBIC licensee. As of September 30, 2011, GC SBIC IV, L.P. had $61,300 of outstanding SBA-guaranteed debentures.
On August 24, 2010, the date GC SBIC IV, L.P. received its license from the SBA, the SBA restricted the affiliated SBIC licensee
from making certain new investments without approval from the SBA. The affiliated SBIC licensee is limited to only making add-on
investments in existing portfolio companies. As such, the majority of the incremental borrowing capacity is available for GC SBIC
IV, L.P. The borrowing capacity of GC SBIC IV, L.P. could be expanded further if the affiliated SBIC retires its SBA-guaranteed
debentures.
GC SBIC IV, L.P. may borrow up to two times the amount of its
regulatory capital, subject to customary regulatory requirements including an examination by the SBA. As of June 30, 2012, the
Company had committed and funded $75,000 to GC SBIC IV, L.P. and had SBA-guaranteed debentures of $123,500 outstanding which mature
between March 2021 and March 2022. The interest rate on $100,000 of outstanding debentures was fixed at an average annualized interest
rate of 3.5%. The annualized interim financing rate on the remaining $23,500 of outstanding debentures was 1.8%. For the three
and nine months ended June 30, 2012, the effective annualized average interest rate, which includes amortization of fees paid on
the debentures, was 3.6% and 3.4%, respectively. For the three and nine months ended June 30, 2012, interest expense was $989 and
$2,319, respectively. Cash paid for interest during the three and nine months ended June 30, 2012 was zero and $1,210,
respectively. For the three and nine months ended June 30, 2011, the effective annualized average interest rate, which includes
amortization of fees paid on the debentures, was 3.7% and 2.9%, respectively. For the three and nine months ended June
30, 2011, interest expense was $256 and $328, respectively. Cash paid for interest during the three and nine months
ended June 30, 2011 was $zero and $64, respectively.
Golub Capital BDC, Inc. and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
(In thousands, except shares
and per share data)
Revolving Credit Facility:
On July 21, 2011,
Golub Capital BDC Funding LLC (“Funding”), a wholly owned subsidiary of the Company, entered into a $75,000 senior
secured revolving credit facility (“Credit Facility”) with Wells Fargo Securities, LLC, as administrative agent, and
Wells Fargo Bank, N.A., as lender.
Under the Credit Facility, which matures on October 21, 2015,
the lender has agreed to extend credit to Funding in an aggregate principal amount of $75,000. Funding’s ability to draw
under the Credit Facility is scheduled to terminate on October 20, 2012. The period from the closing date until October 20, 2012
is referred to as the reinvestment period. All amounts outstanding under the Credit Facility are required to be repaid by October
21, 2015. Through the reinvestment period, the Credit Facility bears interest at one-month LIBOR plus 2.25% per annum. After the
reinvestment period, the rate will reset to LIBOR plus 2.75% per annum for the remaining term of the Credit Facility. In addition
to the stated interest expense on the Credit Facility, the Company is required to pay a fee of 0.50% per annum on any unused portion
of the Credit Facility up to $30,000 and 2.00% on any unused portion in excess of $30,000. The Credit Facility is secured by all
of the assets held by Funding, and the Company has pledged its interests in Funding as collateral to Wells Fargo Bank, N.A., as
the collateral agent, under an ancillary agreement to secure the obligations of the Company as the transferor and servicer under
the Credit Facility. Both the Company and Funding have made customary representations and warranties and are required to comply
with various covenants, reporting requirements and other customary requirements for similar credit facilities. Borrowing under
the Credit Facility is subject to the leverage restrictions contained in the 1940 Act.
The Company plans to transfer certain loans and debt securities
it has originated or acquired from time to time to Funding through a purchase and sale agreement and may cause Funding to originate
or acquire loans in the future, consistent with the Company’s investment objectives.
As of June 30, 2012 and September 30, 2011, the Company had
outstanding debt under the Credit Facility of $32,300 and $2,383, respectively. For the three and nine months ended June 30, 2012,
the Company had borrowings on the Credit Facility of $22,900 and $92,617, respectively, and repayments on the Credit Facility of
$24,800 and $62,700, respectively. For the three and nine months ended June 30, 2012, the effective annualized average interest
rate on outstanding borrowings, which includes amortization of debt financing costs, was 2.9% and 3.0%, respectively. For the three
and nine months ended June 30, 2012, interest expense was $232 and $629, respectively. Cash paid for interest during
the three and nine months ended June 30, 2012 was $228 and $597, respectively.
The average total debt outstanding (including the debt under
the Debt Securitization, SBA debentures and Credit Facility) for the three and nine months ended June 30, 2012 was $317,666 and
$297,322, respectively. The average total debt outstanding (including the debt under the Debt Securitization, SBA debentures and
Credit Facility) for the three and nine months ended June 30, 2011 was $206,471 and $193,250, respectively.
For the three and nine months ended June 30, 2012, the effective
annualized average interest rate on the Company’s total debt outstanding was 3.6% and 3.5%, respectively. For the three and
nine months ended June 30, 2011, the effective annualized average interest rate on the Company’s total debt outstanding was
3.2% and 3.2%, respectively.
Golub Capital BDC, Inc. and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
(In thousands, except shares
and per share data)
A summary of the Company’s maturity requirements
for borrowings as of June 30, 2012 is as follows:
|
|
Payments Due by Period
|
|
|
|
|
|
|
Less Than
|
|
|
|
|
|
|
|
|
More Than
|
|
|
|
Total
|
|
|
1 Year
|
|
|
1-3 Years
|
|
|
3-5 Years
|
|
|
5 Years
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt Securitization
|
|
$
|
174,000
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
174,000
|
|
SBA debentures
|
|
|
123,500
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
123,500
|
|
Credit Facility
|
|
|
32,300
|
|
|
|
-
|
|
|
|
-
|
|
|
|
32,300
|
|
|
|
-
|
|
Total borrowings
|
|
$
|
329,800
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
32,300
|
|
|
$
|
297,500
|
|
Note 7. Derivative Instruments
The following table summarizes the fair value and location of
the Company’s derivative instruments on the consolidated statements of financial condition:
|
|
|
|
|
June 30, 2012
|
|
|
September 30, 2011
|
|
|
|
Location
|
|
|
Fair Value
|
|
|
Fair Value
|
|
Futures Contracts
|
|
Unrealized appreciation (depreciation) on derivative instruments
|
|
|
$
|
75
|
|
|
$
|
(141
|
)
|
TRS
|
|
Unrealized appreciation (depreciation) on derivative instruments
|
|
|
|
74
|
|
|
|
(1,845
|
)
|
Total
|
|
|
|
|
|
$
|
149
|
|
|
$
|
(1,986
|
)
|
The TRS was terminated on April 11, 2012. The balance of $74
as of June 30, 2012 represents unpaid accrued interest owed to the Company, which will be paid in September 2012.
Realized and unrealized gains and losses on derivative instruments
recorded by the Company for the three and nine months ended June 30, 2012 are in the following location on the consolidated statements
of operations:
|
|
|
|
|
Three months ended
June 30, 2012
|
|
|
Nine months ended
June 30, 2012
|
|
|
|
|
|
Three months ended
June 30, 2012
|
|
|
Nine months ended
June 30, 2012
|
|
|
|
Location
|
|
|
Realized Gain (Loss)
|
|
|
Location
|
|
|
Unrealized Gain (Loss)
|
|
Futures Contracts
|
|
Net realized gain (loss) on derivative instruments
|
|
|
$
|
(960
|
)
|
|
$
|
(1,563
|
)
|
|
Net change in unrealized (depreciation) appreciation
on derivative instruments
|
|
|
$
|
(243
|
)
|
|
$
|
217
|
|
TRS
|
|
Net realized gain (loss) on derivative
instruments
|
|
|
|
2,188
|
|
|
|
3,779
|
|
|
Net change in unrealized (depreciation)
appreciation on derivative instruments
|
|
|
|
(1,405
|
)
|
|
|
1,919
|
|
|
|
|
|
|
|
$
|
1,228
|
|
|
$
|
2,216
|
|
|
|
|
|
|
$
|
(1,648
|
)
|
|
$
|
2,136
|
|
There were no realized gains or losses on derivative instruments
for the three and nine months ended June 30, 2011. Unrealized gains and losses on derivative instruments recorded by the Company
for the three and nine months ended June 30, 2011 are in the following location on the consolidated statements of operations:
|
|
|
|
|
Three months ended
June 30, 2011
|
|
|
Nine months ended
June 30, 2011
|
|
|
|
|
Location
|
|
Unrealized Gain (Loss)
|
|
TRS
|
|
|
Net change in unrealized (depreciation) appreciation on derivative instruments
|
|
|
(262
|
)
|
|
|
(262
|
)
|
|
|
|
|
|
|
$
|
(262
|
)
|
|
$
|
(262
|
)
|
Golub Capital BDC, Inc. and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
(In thousands, except shares
and per share data)
Futures contracts:
The Company has entered
into ten-year U.S. Treasury futures contracts to mitigate its exposure to adverse fluctuation in interest rates related to the
Company’s SBA debentures with a total notional amount of $24,300 as June 30, 2012. The interest rate on the Company’s
SBA debentures is fixed semi-annually (each, a “pooling date”) and is based on the ten-year U.S. Treasury rate plus
a market spread. The futures contracts insulate the Company against adverse changes in the ten-year U.S. Treasury rate for SBA
debentures that the Company has drawn but for which the rate will not be fixed until the next pooling date. As of June 30, 2012,
the Company’s cash collateral balance at the broker was $1,287, which is included in cash collateral on deposit with custodian
on the consolidated statements of financial condition.
Based on the daily fluctuation of the fair value of the futures
contracts, the Company records an unrealized gain or loss equal to the daily fluctuation in fair value. If market conditions move
unexpectedly, the Company may not achieve the anticipated benefits of the futures contracts and may realize a loss. Upon maturity
or settlement of the futures contracts, the Company will realize a gain or loss based on the difference of the fair value of the
futures contracts at inception and the fair value of the futures contracts at settlement or maturity. This gain or loss is included
on the consolidated statements of operations as net realized gain (loss) on derivative instruments.
For the three and nine months ended June 30, 2012, the realized
loss on settlement of futures contracts was $(960) and $(1,563), respectively, and the change in unrealized (depreciation) appreciation
related to the futures contracts was $(243) and $217, respectively. As of June 30, 2012 and September 30, 2011, the fair value
of the futures contracts was $75 and $(141), respectively. The futures contracts mature in September 2012. The total volume of
futures contracts that the Company entered into for the three and nine months ended June 30, 2012 was two hundred forty-three and
seven hundred forty-three, respectively.
Total return swap termination:
On April 11,
2012, GCMF terminated the TRS that it had entered into with Citibank.
GCMF entered into the TRS to gain economic exposure to a portfolio
of broadly syndicated loans. Generally, under the terms of a total return swap, one party agrees to make periodic payments to another
party based on the change in the market value of the assets referenced by the total return swap, which may include a specified
security, basket of securities or securities indices during the specified period, in return for periodic payments based on a fixed
or variable interest rate. A total return swap is typically used to obtain exposure to a security or market without owning or taking
physical custody of such security or investing directly in such market.
The Company received from Citibank all interest and fees payable
in respect of the loans included in the portfolio. The Company paid to Citibank interest at a rate equal to three-month LIBOR plus
1.2% per annum based on the settled notional value of the TRS. Upon termination of the TRS, the Company received from Citibank
the net appreciation in the value of the referenced loans. On a quarterly basis, net payment between the Company and Citibank for
interest and realized appreciation and depreciation on the portfolio of loans occurs.
The Company acted as the manager of the rights and obligations
of GCMF under the TRS.
For GAAP purposes, realized gains and losses on the TRS are
composed of any gains or losses on the referenced portfolio of loans as well as the net interest received or owed at the time of
the quarterly settlement. For GAAP purposes, unrealized gains and losses on the TRS are composed of the net interest income earned
or interest expense owed during the period that was not previously settled as well as the change in fair value of the referenced
portfolio of loans.
As of June 30, 2012, the fair value of the TRS was $74, comprised
of unpaid accrued interest still owed to the Company under the terms of the TRS. As of September 30, 2011, the fair value of the
TRS was $(1,845), comprised of spread interest income of $591 and an unrealized loss on the referenced loans of $(2,436). The change
in the fair value of the TRS was $(1,405) and $1,919 for the three and nine months ended June 30, 2012, respectively. The change
in the fair value of the TRS was $(262) and $(262) for the three and nine months ended June 30, 2011, respectively. Realized gains
on the TRS for the three months ended June 30, 2012 were $2,188, which consisted of spread interest income of $990 and a realized
gain of $1,198 on the sale of the referenced loans. Realized gains on the TRS for the nine months ended June 30, 2012 were $3,779,
which consisted of spread interest income of $2,560 and a realized gain of $1,219 on the sale of the referenced loans. There were
no realized gains or losses on the TRS for the three and nine months ended June 30, 2011.
Upon termination, cash collateral of $19,912 that had secured
the obligations to Citibank under the TRS was returned to the Company and is being used to fund new middle-market debt and equity
investments.
Golub Capital BDC, Inc. and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
(In thousands, except shares
and per share data)
Note 8. Commitments and Contingencies
Commitments:
The Company had outstanding commitments
to fund investments totaling $52,034 and $49,449 under various undrawn revolvers and other credit facilities as of June 30, 2012
and September 30, 2011, respectively.
Indemnifications:
In the normal course of
business, the Company enters into contracts and agreements that contain a variety of representations and warranties that provide
general indemnifications. The Company’s maximum exposure under these arrangements is unknown, as these involve future claims
that may be made against the Company but that have not occurred. The Company expects the risk of any future obligations under these
indemnifications to be remote.
Off-balance sheet risk:
Off-balance sheet
risk refers to an unrecorded potential liability that may result in a future obligation or loss, even though it does not appear
on the statements of financial condition. The Company’s derivative instruments contain elements of off-balance sheet market
and credit risk. Derivative instruments can be affected by market conditions, such as interest rate volatility, which could impact
the fair value of the derivative instruments. If market conditions move against the Company, it may not achieve the anticipated
benefits of these derivative instruments and may realize a loss. The Company minimizes market risk through monitoring its investments.
Concentration of credit and counterparty risk:
Credit
risk arises primarily from the potential inability of counterparties to perform in accordance with the terms of the contract. The
Company is engaged in derivative transactions with counterparties. In the event that the counterparties do not fulfill their obligations,
the Company may be exposed to risk. The risk of default depends on the creditworthiness of the counterparties or issuers of the
instruments. The Company’s maximum loss that it could incur related to counterparty risk on its derivative instruments is
the value of the collateral for that respective derivative instrument. It is the Company’s policy to review, as necessary,
the credit standing of each counterparty.
Legal proceedings:
In the normal course of
business, the Company may be subject to legal and regulatory proceedings that are generally incidental to its ongoing operations.
While there can be no assurance of the ultimate disposition of any such proceedings, the Company does not believe any disposition
will have a material adverse effect on the Company’s consolidated financial statements.
Golub Capital BDC, Inc. and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
(In thousands, except shares
and per share data)
Note 9. Financial Highlights
The financial highlights for the Company are as follows:
|
|
Nine months ended June 30,
|
|
|
|
2012
|
|
|
2011
|
|
Per share data
(1)
:
|
|
|
|
|
|
|
Net asset value at beginning of period
|
|
$
|
14.56
|
|
|
$
|
14.71
|
|
Net increase in net assets as a result of public offering
|
|
|
0.04
|
|
|
|
0.06
|
|
Costs related to public offering
|
|
|
(0.03
|
)
|
|
|
(0.04
|
)
|
Dividends and distributions declared
|
|
|
(0.96
|
)
|
|
|
(0.95
|
)
|
Net investment income
|
|
|
0.84
|
|
|
|
0.86
|
|
Net realized (loss) gain on investments
|
|
|
(0.21
|
)
|
|
|
0.11
|
|
Net realized gain (loss) on derivative instruments
|
|
|
0.09
|
|
|
|
-
|
|
Net change in unrealized appreciation (depreciation) on investments
|
|
|
0.15
|
|
|
|
-
|
|
Net change in unrealized appreciation (depreciation) on derivative instruments
|
|
|
0.10
|
|
|
|
-
|
|
Net asset value at end of period
|
|
$
|
14.58
|
|
|
$
|
14.75
|
|
|
|
|
|
|
|
|
|
|
Per share market value at end of period
|
|
$
|
15.09
|
|
|
$
|
14.93
|
|
Total return based on market value
(2)
|
|
|
8.08
|
%
|
|
|
3.79
|
%
|
Total return based on average net asset value*
|
|
|
8.73
|
%
|
|
|
6.52
|
%
|
Shares outstanding at end of period
|
|
|
25,663,009
|
|
|
|
21,733,903
|
|
|
|
|
|
|
|
|
|
|
Ratios/Supplemental Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of expenses (without incentive fees) to average net assets*
|
|
|
6.56
|
%
|
|
|
5.43
|
%
|
Ratio of incentive fees to average net assets*
(3)
|
|
|
1.62
|
%
|
|
|
0.25
|
%
|
Ratio of total expenses to average net assets*
(3)
|
|
|
8.18
|
%
|
|
|
5.68
|
%
|
Ratio of net investment income to average net assets*
|
|
|
7.62
|
%
|
|
|
7.77
|
%
|
|
|
|
|
|
|
|
|
|
Net assets at end of period
|
|
$
|
374,211
|
|
|
$
|
320,523
|
|
Average debt outstanding
|
|
$
|
297,322
|
|
|
$
|
193,250
|
|
Average debt outstanding per share
|
|
$
|
11.59
|
|
|
$
|
8.89
|
|
Portfolio turnover*
|
|
|
28.28
|
%
|
|
|
64.52
|
%
|
|
*
|
Annualized for a period less than one year.
|
|
(1)
|
Based on actual number of shares outstanding at the end
of the corresponding period or the weighted average shares outstanding for the period, unless otherwise noted, as appropriate.
|
|
(2)
|
Total return based on market value assumes dividends
are reinvested.
|
|
(3)
|
During the nine months ended
June 30, 2012, the Investment Adviser irrevocably waived $647 of incentive fees attributable to the TRS. Had the Investment Advisor
not waived these fees, the annualized ratio of incentive fees to average net assets and the annualized ratio of total expenses
to average net assets would have been 1.86% and 8.42%, respectively, for the nine months
ended June 30, 2012.
|
Golub Capital BDC, Inc. and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
(In thousands, except shares
and per share data)
Note 10. Earnings Per Share
The following information sets forth the computation of the
net increase in net assets per share resulting from operations for the three and nine months ended June 30, 2012 and 2011:
|
|
Three months ended June 30,
|
|
|
Nine months ended June 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
Earnings available to stockholders
|
|
$
|
5,393
|
|
|
$
|
6,520
|
|
|
$
|
23,014
|
|
|
$
|
18,358
|
|
Basic and diluted weighted average shares outstanding
|
|
|
25,639,680
|
|
|
|
21,319,348
|
|
|
|
23,803,762
|
|
|
|
18,923,395
|
|
Basic and diluted earnings per share
|
|
$
|
0.21
|
|
|
$
|
0.31
|
|
|
$
|
0.97
|
|
|
$
|
0.97
|
|
Note 11. Dividends and Distributions
The Company’s dividends and distributions are recorded
on the record date. The following table summarizes the Company’s dividend declarations and distributions during the three
and nine months ended June 30, 2012 and 2011:
|
|
|
|
|
|
|
|
Amount
|
|
|
Cash
|
|
|
DRIP Shares
|
|
|
DRIP Shares
|
|
Date Declared
|
|
Record Date
|
|
|
Payment Date
|
|
|
Per Share
|
|
|
Distribution
|
|
|
Issued
|
|
|
Value
|
|
Nine months ended June 30, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/08/2010
|
|
12/20/2010
|
|
|
|
12/30/2010
|
|
|
$
|
0.31
|
|
|
$
|
5,028
|
|
|
|
25,753
|
|
|
$
|
462
|
|
2/8/2011
|
|
3/18/2011
|
|
|
|
3/30/2011
|
|
|
$
|
0.32
|
|
|
$
|
5,375
|
|
|
|
17,779
|
|
|
$
|
303
|
|
5/3/2011
|
|
6/17/2011
|
|
|
|
6/29/2011
|
|
|
$
|
0.32
|
|
|
$
|
6,583
|
|
|
|
24,670
|
|
|
$
|
364
|
|
Nine months ended June 30, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12/07/2011
|
|
12/19/2011
|
|
|
|
12/29/2011
|
|
|
$
|
0.32
|
|
|
$
|
6,580
|
|
|
|
25,052
|
|
|
$
|
375
|
|
2/2/2012
|
|
3/16/2012
|
|
|
|
3/29/2012
|
|
|
$
|
0.32
|
|
|
$
|
7,381
|
|
|
|
55,416
|
|
|
$
|
805
|
|
5/1/2012
|
|
6/15/2012
|
|
|
|
6/29/2012
|
|
|
$
|
0.32
|
|
|
$
|
7,858
|
|
|
|
23,575
|
|
|
$
|
347
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note 12. Subsequent Events
The Company has evaluated subsequent events through the date
these financial statements were issued and has determined that there are no subsequent events that require disclosure except for
the following:
On August 2, 2012, the Company’s Board declared a quarterly
distribution of $0.32 per share payable on September 27, 2012 to holders of record as of September 13, 2012.
On August 6, 2012, the Company announced an At the Market (“ATM”)
program to sell up to $50 million of shares of its common stock. An ATM offering is a registered offering by a publicly traded
issuer of its listed equity securities selling shares directly into the market at market prices. The Company engaged Wells Fargo
Securities and UBS Investment Bank as its placement agents under the ATM program.
Item 2: Management’s Discussion and Analysis
of Financial Condition and Results of Operations
The information contained in this section should be read in
conjunction with our consolidated financial statements and related notes thereto appearing elsewhere in this quarterly report on
Form 10-Q. In this report, “we,” “us,” “our” and “Golub Capital BDC” refer to Golub
Capital BDC, Inc. and its consolidated subsidiaries.
Forward-Looking Statements
Some of the statements in this quarterly report on Form 10-Q
constitute forward-looking statements, which relate to future events or our future performance or financial condition. The forward-looking
statements contained in this quarterly report on Form 10-Q involve risks and uncertainties, including statements as to:
|
·
|
our future operating results;
|
|
·
|
our business prospects and the prospects of our portfolio companies;
|
|
·
|
the effect of investments that we expect to make;
|
|
·
|
our contractual arrangements and relationships with third parties;
|
|
·
|
actual and potential conflicts of interest with our investment adviser, GC Advisors LLC, or GC Advisors, and other affiliates
of Golub Capital Incorporated and Golub Capital LLC (formerly Golub Capital Management LLC), collectively, Golub Capital;
|
|
·
|
the dependence of our future success on the general economy and its effect on the industries in which we invest;
|
|
·
|
the ability of our portfolio companies to achieve their objectives;
|
|
·
|
the use of borrowed money to finance a portion of our investments;
|
|
·
|
the adequacy of our financing sources and working capital;
|
|
·
|
the timing of cash flows, if any, from the operations of our portfolio companies;
|
|
·
|
the ability of GC Advisors to locate suitable investments for us and to monitor and administer our investments;
|
|
·
|
the ability of GC Advisors or its affiliates to attract and retain highly talented professionals;
|
|
·
|
our ability to qualify and maintain our qualification as a regulated investment company, or RIC, and as a business development
company;
|
|
·
|
the impact on our business of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations issued
thereunder; and
|
|
·
|
the effect of changes to tax legislation and our tax position.
|
Such forward-looking statements may include statements preceded
by, followed by or that otherwise include the words “may,” “might,” “will,” “intend,”
“should,” “could,” “can,” “would,” “expect,” “believe,”
“estimate,” “anticipate,” “predict,” “potential,” “plan” or similar
words. The forward-looking statements contained in this quarterly report on Form 10-Q involve risks and uncertainties, many of
which are beyond our control and difficult to predict. Our actual results could differ materially from those implied or expressed
in the forward-looking statements for any reason, including the factors set forth as “Risk Factors” and elsewhere in
this quarterly report on Form 10-Q.
We have based the forward-looking statements included in this
report on information available to us on the date of this report, and we assume no obligation to update any such forward-looking
statements. Actual results could differ materially from those anticipated in our forward-looking statements and future results
could differ materially from historical performance. Although we undertake no obligation to revise or update any forward-looking
statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures
that we may make directly to you or through reports that we have filed or in the future may file with the Securities and Exchange
Commission, or the SEC, including annual reports on Form 10-K, registration statements on Form N-2, quarterly reports on Form 10-Q
and current reports on Form 8-K.
You should understand that, under Section 27A(b)(2)(B) of the
Securities Act of 1933, as amended, and Section 21E(b)(2)(B) of the Securities Exchange Act of 1934, as amended, or the Exchange
Act, the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to this quarterly
report on Form 10-Q.
Overview
We are an externally managed, closed-end, non-diversified management
investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940,
as amended, or the 1940 Act. In addition, for U.S. federal income tax purposes, we have elected to be treated as a RIC under Subchapter
M of the Internal Revenue Code of 1986, as amended, or the Code. As a business development company and a RIC, we are also subject
to certain constraints, including limitations imposed by the 1940 Act and the Code. We were formed in November 2009 to continue
and expand the business of our predecessor, Golub Capital Master Funding LLC, or GCMF, which commenced operations in July 2007,
in making investments in senior secured, one stop (a loan that combines characteristics of traditional first lien senior secured
loans and second lien or subordinated loans), mezzanine (a loan that ranks senior only to a borrower’s equity securities
and ranks junior to all of such borrower’s other indebtedness in priority of payment), second lien loans and equity securities
of middle-market companies that are, in most cases, sponsored by private equity firms.
Our shares are currently listed on The NASDAQ Global Select
Market under the symbol “GBDC”.
Our investment objective is to maximize the total return to
our stockholders in the form of current income and capital appreciation through debt and minority equity investments. We intend
to achieve our investment objective by (1) accessing the established loan origination channels developed by Golub Capital, a leading
lender to middle-market companies with over $6.0 billion in capital under management as of June 30, 2012, (2) selecting investments
within our core middle-market company focus, (3) partnering with experienced private equity firms, or sponsors, in many cases with
whom we have invested alongside in the past, (4) implementing the disciplined underwriting standards of Golub Capital and (5) drawing
upon the aggregate experience and resources of Golub Capital.
Our investment activities are managed by GC Advisors and supervised
by our board of directors of which a majority of the members are independent of us.
Under an investment advisory agreement, or the Investment Advisory
Agreement, entered into on April 14, 2010, and amended and restated on July 16, 2010, we have agreed to pay GC Advisors an annual
base management fee based on our average adjusted gross assets as well as an incentive fee based on our investment performance.
We have also entered into an administration agreement, or the Administration Agreement, with GC Service Company, LLC, or GC Service,
under which we have agreed to reimburse GC Service for our allocable portion (subject to the review and approval of our independent
directors) of overhead and other expenses incurred by GC Service in performing its obligations under the Administration Agreement.
We seek to create a diverse portfolio that includes senior secured,
one stop, mezzanine and second lien loans and warrants and minority equity securities by investing approximately $5 to $25 million
of capital, on average, in the securities of middle-market companies. We may also selectively invest more than $25 million in some
of our portfolio companies and generally expect that the size of our individual investments will vary proportionately with the
size of our capital base.
As of June 30, 2012, our portfolio at fair value was comprised
of 40.7% senior secured loans, 37.2% one stop loans, 7.6% second lien loans, 11.7% mezzanine loans and 2.8% equity securities.
As of September 30, 2011, our portfolio at fair value was comprised of 44.3% senior secured loans, 38.7% one stop loans, 4.8% second
lien loans, 10.2% mezzanine loans and 2.0% equity securities.
As of June 30, 2012 and September 30, 2011, we had debt investments
in 116 and 103 portfolio companies, respectively. For the three and nine months ended June 30, 2012, our income producing assets,
which represented nearly 100% of our total portfolio, had a weighted average annualized interest income (which excludes income
resulting from amortization of fees and discounts) yield of 9.3% and 9.4% and a weighted average annualized investment income (which
includes interest income and amortization of fees and discounts) yield of 10.0% and 10.3%, respectively. For the three and nine
months ended June 30, 2011, our income producing assets, which represented nearly 100% of our total portfolio, had a weighted average
annualized interest income (which excludes income resulting from amortization of fees and discounts) yield of 8.6% and 8.6% and
a weighted average annualized investment income (which includes interest income and amortization of fees and discounts) yield of
9.6% and 10.1%, respectively.
Revenues:
We generate revenue in the form of interest
income on debt investments and capital gains and distributions, if any, on portfolio company investments that we originate or acquire.
Our debt investments, whether in the form of senior secured, one stop, mezzanine or second lien loans, typically have a term of
three to seven years and bear interest at a fixed or floating rate. In some instances, we receive payments on our debt investments
based on scheduled amortization of the outstanding balances. In addition, we receive repayments of some of our debt investments
prior to their scheduled maturity date. The frequency or volume of these repayments fluctuates significantly from period to period.
Our portfolio activity also reflects the proceeds of sales of securities. In some cases, our investments provide for deferred interest
payments or payment-in-kind, or PIK, interest. The principal amount of loans and any accrued but unpaid interest generally become
due at the maturity date. In addition, we may generate revenue in the form of commitment, origination, amendment, structuring or
due diligence fees, fees for providing managerial assistance and consulting fees. Loan origination fees, original issue discount
and market discount or premium are capitalized, and we accrete or amortize such amounts as interest income. We record prepayment
premiums on loans as interest income. When we receive partial principal payments on a loan in an amount that exceeds its amortized
cost, we record the excess principal payment as interest income. Dividend income on preferred equity securities is recorded as
dividend income on an accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be
collected. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the
ex-dividend date for publicly traded portfolio companies.
We recognize realized gains or losses on investments based on
the difference between the net proceeds from the disposition and the cost basis of the investment or derivative instrument, without
regard to unrealized gains or losses previously recognized. We record current period changes in fair value of investments and derivative
instruments that are measured at fair value as a component of the net change in unrealized appreciation (depreciation) on investments
in the consolidated statements of operations.
Expenses:
Our primary operating expenses include the
payment of fees to GC Advisors under the Investment Advisory Agreement, our allocable portion of overhead expenses under the Administration
Agreement and other operating costs described below. Additionally, we pay interest expense on our outstanding debt. We bear all
other out-of-pocket costs and expenses of our operations and transactions, including:
|
·
|
organizational expenses;
|
|
·
|
calculating our net asset value (including the cost and expenses of any independent valuation firm);
|
|
·
|
fees and expenses incurred by GC Advisors payable to third parties, including agents, consultants or other advisors, in monitoring
financial and legal affairs for us and in monitoring our investments and performing due diligence on our prospective portfolio
companies or otherwise relating to, or associated with, evaluating and making investments;
|
|
·
|
interest payable on debt, if any, incurred to finance our investments and expenses related to unsuccessful portfolio acquisition
efforts;
|
|
·
|
offerings of our common stock and other securities;
|
|
·
|
investment advisory and management fees;
|
|
·
|
administration fees and expenses, if any, payable under the Administration Agreement (including payments under the Administration
Agreement between us and GC Service based upon our allocable portion of GC Service’s overhead in performing its obligations
under the Administration Agreement, including rent and the allocable portion of the cost of our chief compliance officer, chief
financial officer and their respective staffs);
|
|
·
|
fees payable to third parties, including agents, consultants or other advisors, relating to, or associated with evaluating
and making, investments in portfolio companies, including costs associated with meeting financial sponsors;
|
|
·
|
transfer agent, dividend agent and custodial fees and expenses;
|
|
·
|
U.S. federal and state registration fees;
|
|
·
|
all costs of registration and listing our shares on any securities exchange;
|
|
·
|
U.S. federal, state and local taxes;
|
|
·
|
independent directors’ fees and expenses;
|
|
·
|
costs of preparing and filing reports or other documents required by the SEC or other regulators;
|
|
·
|
costs of any reports, proxy statements or other notices to stockholders, including printing costs;
|
|
·
|
costs associated with individual or group stockholders;
|
|
·
|
costs associated with compliance under the Sarbanes-Oxley Act of 2002;
|
|
·
|
our allocable portion of any fidelity bond, directors and officers/errors and omissions liability insurance, and any other
insurance premiums;
|
|
·
|
direct costs and expenses of administration, including printing, mailing, long distance telephone, copying, secretarial and
other staff, independent auditors and outside legal costs;
|
|
·
|
proxy voting expenses; and
|
|
·
|
all other expenses incurred by us or GC Service in connection with administering our business.
|
During periods of asset growth, we expect our general and administrative
expenses to be relatively stable or decline as a percentage of total assets and increase during periods of asset declines. Incentive
fees, interest expenses and costs relating to future offerings of securities would be additive to the expenses described above.
GC Advisors, as collateral manager for Golub Capital BDC 2010-1
LLC, or the Securitization Issuer, under the collateral management agreement, is entitled to receive an annual fee in an amount
equal to 0.35% of the principal balance of the portfolio loans held by the Securitization Issuer at the beginning of the collection
period relating to each payment date, which is payable in arrears on each payment date. This fee, which is less than the management
fee payable under the Investment Advisory Agreement, is paid directly by the Securitization Issuer to GC Advisors and offset against
such management fee. Accordingly, the 1.375% management fee paid by us to GC Advisors under the Investment Advisory Agreement on
all of our assets, including those indirectly held through the Securitization Issuer, is reduced, on a dollar-for-dollar basis,
by an amount equal to such 0.35% fee paid to GC Advisors by the Securitization Issuer. The term “collection period”
refers to a quarterly period running from the day after the end of the prior collection period to the fifth business day of the
calendar month in which a payment date occurs. This fee may be waived by the collateral manager. The collateral management agreement
does not include any incentive fee payable to GC Advisors. In addition, the Securitization Issuer paid Wells Fargo Securities,
LLC a structuring and placement fee for its services in connection with the initial structuring of a $300 million term debt securitization,
or the Debt Securitization. The Securitization Issuer also agreed to pay ongoing administrative expenses to the trustee, collateral
manager, independent accountants, legal counsel, rating agencies and independent managers in connection with developing and maintaining
reports and providing required services in connection with the administration of the Debt Securitization. The administrative expenses
are paid by the Securitization Issuer on each payment date in two parts: (1) a component that is paid in a priority to other amounts
distributed by the Securitization Issuer, subject to an administrative expense cap equal to the sum of 0.04% per annum on the adjusted
principal balance of the portfolio loans and other assets held by the Securitization Issuer on the last day of the collection period
relating to such payment date, plus $150,000 per annum, and (2) a component that is paid in a subordinated position relative to
other amounts distributed by the Securitization Issuer, equal to any amounts that exceed the aforementioned administrative expense
cap. We believe that these administrative expenses approximate the amount of ongoing fees and expenses that we would be required
to pay in connection with a traditional secured credit facility. Our common stockholders indirectly bear all of these expenses.
Recent Developments
On August 2, 2012, our board of directors declared a quarterly
distribution of $0.32 per share payable on September 27, 2012 to holders of record as of September 13, 2012.
On August 2, 2012, our board of directors approved a share repurchase
program which allows us to repurchase up to $30 million of our common stock on the open market at prices below our net asset value
as reported in our most recently published financial statements.
Consolidated Results of Operations
Consolidated operating results for the three and nine months
ended June 30, 2012 and 2011 are as follows:
|
|
Three months ended June 30,
|
|
|
Variances
|
|
|
Nine months ended June 30,
|
|
|
Variances
|
|
|
|
2012
|
|
|
2011
|
|
|
2012 vs. 2011
|
|
|
2012
|
|
|
2011
|
|
|
2012 vs. 2011
|
|
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
$
|
13,744
|
|
|
$
|
9,106
|
|
|
$
|
4,638
|
|
|
$
|
37,816
|
|
|
$
|
24,173
|
|
|
$
|
13,643
|
|
Income from amortization
of discounts and origination fees
|
|
|
1,067
|
|
|
|
965
|
|
|
|
102
|
|
|
|
3,447
|
|
|
|
4,146
|
|
|
|
(699
|
)
|
Dividend
income
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
377
|
|
|
|
-
|
|
|
|
377
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
investment income
|
|
|
14,811
|
|
|
|
10,071
|
|
|
|
4,740
|
|
|
|
41,640
|
|
|
|
28,319
|
|
|
|
13,321
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
expenses
|
|
|
8,133
|
|
|
|
4,119
|
|
|
|
4,014
|
|
|
|
21,556
|
|
|
|
11,954
|
|
|
|
9,602
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment
income
|
|
|
6,678
|
|
|
|
5,952
|
|
|
|
726
|
|
|
|
20,084
|
|
|
|
16,365
|
|
|
|
3,719
|
|
Net realized gains (losses)
on investments and derivative instruments
|
|
|
1,158
|
|
|
|
71
|
|
|
|
1,087
|
|
|
|
(2,786
|
)
|
|
|
1,997
|
|
|
|
(4,783
|
)
|
Net
change in unrealized (depreciation) appreciation on investments and derivative instruments
|
|
|
(2,443
|
)
|
|
|
497
|
|
|
|
(2,940
|
)
|
|
|
5,716
|
|
|
|
(4
|
)
|
|
|
5,720
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
5,393
|
|
|
$
|
6,520
|
|
|
$
|
(1,127
|
)
|
|
$
|
23,014
|
|
|
$
|
18,358
|
|
|
$
|
4,656
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
earning portfolio company investments, at fair value
|
|
$
|
602,056
|
|
|
$
|
427,607
|
|
|
$
|
174,449
|
|
|
$
|
544,103
|
|
|
$
|
380,463
|
|
|
$
|
163,640
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average debt outstanding
|
|
$
|
317,666
|
|
|
$
|
206,471
|
|
|
$
|
111,195
|
|
|
$
|
297,322
|
|
|
$
|
193,250
|
|
|
$
|
104,072
|
|
The results of operations for the three and nine months ended
June 30, 2012 and 2011 may not be indicative of the results we report in future periods. Net income can vary substantially from
period to period for various reasons, including the recognition of realized gains and losses and unrealized appreciation and depreciation.
As a result, quarterly comparisons of net income may not be meaningful.
Investment Income
Interest income increased by $4.6 million from the three months
ended June 30, 2011 to the three months ended June 30, 2012 and was primarily driven by an increase in the weighted average investment
balance of earning investments from $427.6 million for the three months ended June 30, 2011 to $602.1 million for the three months
ended June 30, 2012. To a lesser extent, the increase in interest income was driven by a higher weighted average annualized interest
income yield (which excludes income resulting from amortization of fees and discounts), which increased from 8.6% for the three
months ended June 30, 2011 to 9.3% for the three months ended June 30, 2012.
Interest income increased by $13.6 million from the nine months
ended June 30, 2011 to the nine months ended June 30, 2012 and was primarily driven by an increase in the weighted average investment
balance of earning investments from $380.5 million for the nine months ended June 30, 2011 to $544.1 million for the nine months
ended June 30, 2012. To a lesser extent, the increase in interest income was driven by a higher weighted average annualized interest
income yield (which excludes income resulting from amortization of fees and discounts), which increased from 8.6% for the nine
months ended June 30, 2011 to 9.4% for the nine months ended June 30, 2012.
The increase in the yield was driven primarily by the change
in asset mix of our portfolio. Higher yielding subordinated and one stop investments increased from 10.6% and 34.8%, respectively,
of the total investment in portfolio companies as of June 30, 2011 to 11.7% and 37.2%, respectively, of the total investment in
portfolio companies as of June 30, 2012. From June 30, 2011 to June 30, 2012, lower yielding senior secured investments decreased
from 47.4% to 40.7% of the total investment in portfolio companies.
Annualized interest income yield (which excludes income resulting
from amortization of fees and discounts) by security type for the three and nine months ended June 30, 2012 and 2011 was as follows:
|
|
Three months ended June 30,
|
|
|
Nine months ended June 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
Senior secured
|
|
|
7.3
|
%
|
|
|
7.2
|
%
|
|
|
7.4
|
%
|
|
|
7.2
|
%
|
One stop
|
|
|
8.9
|
%
|
|
|
8.6
|
%
|
|
|
9.0
|
%
|
|
|
8.6
|
%
|
Second lien
(1)
|
|
|
11.5
|
%
|
|
|
11.6
|
%
|
|
|
10.4
|
%
|
|
|
10.5
|
%
|
Subordinated debt
|
|
|
13.8
|
%
|
|
|
14.1
|
%
|
|
|
13.7
|
%
|
|
|
14.0
|
%
|
(1)
Second lien loans include loans structured as
first lien last out term loans.
Interest rate yields increased for the three and nine months
ended June 30, 2012 for senior secured and one stop categories, primarily due to increased pricing on new originations for these
product types from pricing for the three and nine months ended June 30, 2011. Interest rate yields on second lien investments and
fixed rate subordinated debt remained relatively flat as pricing on new originations remained relatively flat the past three quarters.
For additional details on investment yields and asset mix, refer to the “
Liquidity and Capital Resources
-
Portfolio
Composition, Investment Activity and Yield”
section below.
Income from the amortization of discounts and origination fees
increased by $0.1 million from the three months ended June 30, 2011 to the three months ended June 30, 2012. Income from the amortization
of discounts and origination fees decreased by $0.7 million from the nine months ended June 30, 2011 to the nine months ended June
30, 2012. The fluctuation in amortization of discounts and origination fees depends on the volume of payoffs and the discounts
on the loans at the time of payoffs. For the nine months ended June 30, 2011, the discounts and origination fees accelerated into
income were larger than for the nine months ended June 30, 2012.
Dividend income increased by $0.4 million from the nine months
ended June 30, 2011 to the nine months ended June 30, 2012 as a result of dividend income received from an equity investment in
a portfolio company.
Expenses
The following table summarizes our expenses:
|
|
Three months ended June 30,
|
|
|
Variances
|
|
|
Nine months ended June 30,
|
|
|
Variances
|
|
|
|
2012
|
|
|
2011
|
|
|
2012 vs. 2011
|
|
|
2012
|
|
|
2011
|
|
|
2012 vs. 2011
|
|
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and other debt financing expenses
|
|
$
|
2,865
|
|
|
$
|
1,637
|
|
|
$
|
1,228
|
|
|
$
|
7,811
|
|
|
$
|
4,681
|
|
|
$
|
3,130
|
|
Base management fee
|
|
|
2,220
|
|
|
|
1,497
|
|
|
|
723
|
|
|
|
6,187
|
|
|
|
4,122
|
|
|
|
2,065
|
|
Incentive fee
|
|
|
1,917
|
|
|
|
113
|
|
|
|
1,804
|
|
|
|
4,261
|
|
|
|
525
|
|
|
|
3,736
|
|
Professional fees
|
|
|
538
|
|
|
|
500
|
|
|
|
38
|
|
|
|
1,685
|
|
|
|
1,558
|
|
|
|
127
|
|
Administrative service fee
|
|
|
489
|
|
|
|
224
|
|
|
|
265
|
|
|
|
1,207
|
|
|
|
611
|
|
|
|
596
|
|
General and administrative expenses
|
|
|
104
|
|
|
|
148
|
|
|
|
(44
|
)
|
|
|
405
|
|
|
|
457
|
|
|
|
(52
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
$
|
8,133
|
|
|
$
|
4,119
|
|
|
$
|
4,014
|
|
|
$
|
21,556
|
|
|
$
|
11,954
|
|
|
$
|
9,602
|
|
Interest and debt financing expenses increased from the three
months ended June 30, 2011 to the three months ended June 30, 2012 primarily due to an increase in the weighted average of outstanding
borrowings from $206.5 million for the three months ended June 30, 2011 to $317.7 million for the three months ended June 30, 2012.
In addition to the $174.0 million of borrowings under the Debt Securitization that was outstanding for the three months ended June
30, 2012 and 2011, we increased our use of debt through GC SBIC IV, L.P., our small business investment company, or SBIC, subsidiary
and our revolving credit facility, or the Credit Facility, which had outstanding balances of $123.5 million and $32.3 million,
respectively, as of June 30, 2012 and $48.3 million and zero, respectively, as of June 30, 2011. To a lesser extent, the increase
in interest expense was also caused by an increase in the effective annualized average interest rate on our outstanding debt from
3.2% for the three months ended June 30, 2011 to 3.6% for the three months ended June 30, 2012.
Interest and debt financing expenses increased from the nine
months ended June 30, 2011 to the nine months ended June 30, 2012 primarily due to an increase in the weighted average of outstanding
borrowings from $193.3 million for the nine months ended June 30, 2011 to $297.3 million for the nine months ended June 30, 2012.
To a lesser extent, the increase in interest expense was also caused by an increase in the effective annualized average interest
rate on our outstanding debt from 3.2% for the nine months ended June 30, 2011 to 3.5% for the nine months ended June 30, 2012.
The base management fee and the administrative service fee primarily
increased as a result of an increase in average assets and average investments from the three and nine months ended June 30, 2011
to the three and nine months ended June 30, 2012. Additionally, as permitted under the Administration Agreement, beginning January
1, 2012, the allocable portion of the cost of our chief compliance officer and chief financial officer and their respective staffs
were charged to us, which was also partially related to the increase in the administrative service fee. These costs are permitted
to be charged under the terms of the Administration Agreement but were previously being waived by GC Service.
The incentive fee increased by $1.8 million and $3.7 million
from the three and nine months ended June 30, 2011 to the three and nine months ended June 30, 2012, respectively, as a result
of the increase in pre-incentive fee net investment income.
As described in the “Net Realized and Unrealized Gains
and Losses” section below, we entered into the TRS with Citibank for the purpose of gaining economic exposure to a portfolio
of broadly syndicated loans. We subsequently terminated the TRS on April 11, 2012. For the periods ending September 30, 2011 and
prior, we had included interest spread payments, which represent the difference between the interest and fees received on the referenced
assets underlying the TRS and the interest paid to Citibank on the settled notional value of the TRS, from the TRS in the capital
gains component of the incentive fee calculation as this is consistent with generally accepted accounting principles in the United
States of America, or GAAP, which records such payments in net realized gains/(losses) on derivative instruments in the consolidated
statement of operations. However, we changed our methodology in the first fiscal quarter of fiscal year 2012 pursuant to discussions
with the staff, or the Staff, of the SEC, resulting in the TRS interest spread payments being included in the income component
of the incentive fee calculation.
For the three and nine months ended June 30, 2012, we received
interest spread payments from the TRS of $1.0 million and $2.6 million, respectively. For the three months ended December 31, 2011,
including the interest spread payments from the TRS in the income component of the incentive fee calculation caused an increase
in the incentive fee by $0.6 million. Upon reviewing the incentive fee calculation and the treatment of the interest spread payments
from the TRS, GC Advisors irrevocably waived the incremental portion of the incentive fee attributable from the TRS interest spread
payments for the three months ended December 31, 2011. For the three months ended June 30, 2012, the incentive fee was $1.9 million.
For the nine months ended June 30, 2012, after taking into account the waiver by GC Advisors, the incentive fee was $4.3 million,
rather than $4.9 million. The incentive fee for the three and nine months ended June 30, 2011 was $0.1 million and $0.5 million,
respectively.
Golub Capital Incorporated pays for certain expenses incurred
by us. These expenses are subsequently reimbursed in cash. Total expenses reimbursed by us to Golub Capital Incorporated for the
three and nine months ended June 30, 2012 were $0.1 million and $0.3 million, respectively. Total expenses reimbursed by us to
Golub Capital Incorporated for the three and nine months ended June 30, 2011 were $0.1 million and $0.3 million, respectively.
As of June 30, 2012 and September 30, 2011, included in accounts
payable and accrued expenses were $0.1 million and $0.1 million, respectively, for accrued expenses paid on behalf of us by Golub
Capital Incorporated.
Net Realized and Unrealized Gains and Losses
The following table summarizes our net realized and unrealized
gains (losses) for the periods presented:
|
|
Three months ended June 30,
|
|
|
Variances
|
|
|
Nine months ended June 30,
|
|
|
Variances
|
|
|
|
2012
|
|
|
2011
|
|
|
2012 vs. 2011
|
|
|
2012
|
|
|
2011
|
|
|
2012 vs. 2011
|
|
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized (loss) gain on investments
|
|
$
|
(70
|
)
|
|
$
|
71
|
|
|
$
|
(141
|
)
|
|
$
|
(5,002
|
)
|
|
$
|
1,997
|
|
|
$
|
(6,999
|
)
|
Net realized gain on TRS
|
|
|
2,188
|
|
|
|
-
|
|
|
|
2,188
|
|
|
|
3,779
|
|
|
|
-
|
|
|
|
3,779
|
|
Net realized (loss) on financial futures contracts
|
|
|
(960
|
)
|
|
|
-
|
|
|
|
(960
|
)
|
|
|
(1,563
|
)
|
|
|
-
|
|
|
|
(1,563
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized gain (loss)
|
|
|
1,158
|
|
|
|
71
|
|
|
|
1,087
|
|
|
|
(2,786
|
)
|
|
|
1,997
|
|
|
|
(4,783
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized (depreciation) on investments
|
|
|
(3,338
|
)
|
|
|
(1,279
|
)
|
|
|
(2,059
|
)
|
|
|
(9,487
|
)
|
|
|
(5,768
|
)
|
|
|
(3,719
|
)
|
Unrealized appeciation on investments
|
|
|
2,543
|
|
|
|
2,038
|
|
|
|
505
|
|
|
|
13,067
|
|
|
|
6,026
|
|
|
|
7,041
|
|
Unrealized (depreciation) appreciation on TRS
|
|
|
(1,405
|
)
|
|
|
(262
|
)
|
|
|
(1,143
|
)
|
|
|
1,919
|
|
|
|
(262
|
)
|
|
|
2,181
|
|
Unrealized (deprecation) appreciation on financial
futures contracts
|
|
|
(243
|
)
|
|
|
-
|
|
|
|
(243
|
)
|
|
|
217
|
|
|
|
-
|
|
|
|
217
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in unrealized
(depreciation) appreciation on investments and derivative instruments
|
|
$
|
(2,443
|
)
|
|
$
|
497
|
|
|
$
|
(2,940
|
)
|
|
$
|
5,716
|
|
|
$
|
(4
|
)
|
|
$
|
5,720
|
|
For the three and nine months ended June 30, 2012, we had net
realized losses on investments of $0.1 million and $5.0 million, respectively, primarily as a result of the sale of our investment
in two non-accrual portfolio companies in the nine months ended June 30, 2012. During the three months ended June 30, 2012, we
had $3.3 million in unrealized depreciation on 85 portfolio company investments, which was partially offset by $2.5 million in
unrealized appreciation on 35 portfolio company investments. For the nine months ended June 30, 2012, we had $13.1 million in unrealized
appreciation on 54 portfolio company investments, which was partially offset by $9.5 million in unrealized depreciation on 81 portfolio
company investments. Unrealized appreciation during the three and nine months ended June 30, 2012 resulted from an increase in
fair value primarily due to the rise in market prices and a reversal of prior period unrealized depreciation. A majority of the
unrealized depreciation resulted from negative credit related adjustments in certain of our investments which caused a reduction
in fair value.
For the three and nine months ended June 30, 2011, we had $0.1
million and $2.0 million in net realized gains, respectively. For the three months ended June 30, 2011, we had $2.0
million in unrealized appreciation on 29 portfolio company investments, which was partially offset by $1.3 million in unrealized
depreciation on 78 portfolio company investments. For the nine months ended June 30, 2011, we had $6.0 million in unrealized appreciation
on 57 portfolio company investments, which was partially offset by $5.8 million in unrealized depreciation on 72 portfolio company
investments.
Unrealized appreciation during the three and nine months ended
June 30, 2011 resulted from an increase in fair value primarily due to the rise in market prices and a reversal of prior period
unrealized depreciation. Unrealized depreciation primarily resulted from negative credit-related adjustments which caused a reduction
in fair value.
Termination of the Total Return Swap
On April 11, 2012, we terminated the TRS that we had entered
into with Citibank.
The purpose of entering into the TRS was to gain economic exposure
to a portfolio of broadly syndicated loans. Generally, under the terms of a total return swap, one party agrees to make periodic
payments to another party based on the change in the market value of the assets referenced by the total return swap, which may
include a specified security, basket of securities or securities indices during the specified period, in return for periodic payments
based on a fixed or variable interest rate.
As of June 30, 2012, the fair value of the TRS was $0.1 million,
comprised of unpaid accrued interest still owed to us under the terms of the TRS, which will be paid in September 2012. As of September
30, 2011, the fair value of the TRS was $(1.8) million, comprised of spread interest income of $0.6 million and an unrealized loss
on the referenced loans of $(2.4) million. The change in the fair value of the TRS was $(1.4) million and $1.9 million for the
three and nine months ended June 30, 2012, respectively. The change in the fair value of the TRS was $(0.3) million and $(0.3)
million for the three and nine months ended June 30, 2011, respectively. Realized gains on the TRS for the three months ended June
30, 2012 were $2.2 million, which consisted of spread interest income of $1.0 million and a realized gain of $1.2 million on the
referenced loans. Realized gains on the TRS for the nine months ended June 30, 2012 were $3.8 million, which consisted of spread
interest income of $2.6 million and a realized gain of $1.2 million on the referenced loans. There were no realized gains or loss
on the TRS for the three and nine months ended June 30, 2011.
Cash collateral of $19.9 million that had secured the obligations
to Citibank under the TRS was returned to the company and will be used to fund new middle-market debt and equity investments.
Ten-Year U.S. Treasury Futures Contracts
We have entered into ten-year U.S. Treasury futures contracts
to mitigate our exposure to adverse fluctuation in interest rates related to our Small Business Administration, or SBA, debentures.
Based on the daily fluctuation of the fair value of the referenced securities of the financial futures, we record an unrealized
gain or loss equal to the daily fluctuation in fair value. Upon maturity or settlement of the futures contracts, we will realize
a gain or loss based on the difference of the fair value of the financial futures contracts at inception and the fair value of
the futures contracts at settlement or maturity. As of June 30, 2012 and September 30, 2011, the fair value of the futures contracts
was $0.1 million and $(1.0) million, respectively. For the three and nine months ended June 30, 2012, the realized loss on settlement
of futures contracts was $(1.0) million and $(1.6) million, respectively. For the three and nine months ended June 30, 2012, the
change in unrealized (depreciation) appreciation related to the futures contracts was $(0.2) million and $0.2 million, respectively.
The losses on the futures contracts were a result of the decrease in the ten-year U.S. Treasury rate. The futures contracts will
mature in September 2012.
Liquidity and Capital Resources
As a business development company, we distribute substantially
all of our net income to our stockholders and will have an ongoing need to raise additional capital for investment purposes. To
fund growth, we have a number of alternatives available to increase capital, including raising equity, increasing debt, including
through one or more additional securitization facilities, and funding from operational cash flow.
For the nine months ended June 30, 2012, we experienced a net
decrease in cash and cash equivalents of $28.3 million. During the same period, we used $131.6 million in operating activities,
primarily as a result of fundings of portfolio investments of $292.9 million. This was partially offset by proceeds from principal
payments and sales of portfolio investments of $120.6 million and net investment income of $20.1 million. During the same period,
cash used in investment activities of $21.6 million was driven by the change in restricted cash and cash equivalents. Lastly, cash
provided by financing activities was $125.0 million, primarily due to borrowings on debt of $154.8 million and proceeds from shares
sold from our public offering of $57.2 million (described below), partially offset by repayments of debt of $62.7 million and distributions
paid of $21.8 million.
On January 31, 2012, we priced a public offering of 3,500,000
shares of our common stock at a public offering price of $15.35 per share, raising approximately $53.7 million in gross proceeds.
On February 3, 2012, the transaction closed, the shares were delivered, and proceeds, net of offering costs but before expenses,
of $52.3 million were received. On March 1, 2012, we sold an additional 325,000 shares of our common stock at a public offering
price of $15.35 per share pursuant to the underwriters’ partial exercise of the over-allotment option we granted to the underwriters
in connection with the offering that closed on February 3, 2012. Settlement of this partial exercise of the over-allotment
option resulted in gross proceeds of $5.0 million and proceeds, net of offering costs but before expenses, of $4.8 million.
For the nine months ended June 30, 2011, we experienced a net
decrease in cash and cash equivalents of $17.1 million. During the same period we used $107.9 million in operating activities,
primarily as a result of fundings of portfolio investments of $274.8 million. This was partially offset by proceeds from principal
payments of $108.9 million and sales of portfolio investments of $80.1 million and net investment income of $16.4 million. During
the same period, cash provided by financing activities was $88.3 million, primarily due to net proceeds from the follow-on offering
of $59.4 million and borrowings on debt of $48.3 million, partially offset by distributions paid of $17.0 million. Lastly,
net cash provided by investing activities was $2.5 million as a result of a decrease in restricted cash and cash equivalents.
As of June 30, 2012 and September 30, 2011, we had cash and
cash equivalents of $18.1 million and $46.4 million, respectively. In addition, we had restricted cash and cash equivalents of
$45.1 million and $23.4 million as of June 30, 2012 and September 30, 2011, respectively. Cash and cash equivalents are available
to fund new investments, pay operating expenses and pay distributions. As of June 30, 2012, $18.8 million of our restricted cash
and cash equivalents could be used to fund new investments that meet the investment guidelines established in the Debt Securitization,
which are described in further detail in Note 6 to our consolidated financial statements, and for the payment of interest expense
on the notes issued in the Debt Securitization. $4.3 million of such restricted cash and cash equivalents was used to fund investments
that meet the guidelines under the Credit Facility as well as for the payment of interest expense and revolving debt of the Credit
Facility. The remaining $22.0 million of restricted cash and cash equivalents can be used to fund new investments that meet the
regulatory and investment guidelines established by the SBA for our SBIC, which are described in further detail in Note 6 to our
consolidated financial statements, and for interest expense and fees on our outstanding SBA debentures.
As of June 30 2012 and September 30, 2011, we had outstanding
commitments to fund investments totaling $52.0 million and $49.4 million, respectively. These amounts may or may not be funded
to the borrowing party now or in the future. The unfunded commitments relate to loans with various maturity dates, but the entire
amount was eligible for funding to the borrowers as of June 30, 2012 and September 30, 2011, subject to the terms of each loan’s
respective credit agreement.
As of June 30, 2012 and September 30, 2011, subject to leverage
and borrowing base restrictions, we had approximately $42.7 million and $72.6 million, respectively, available for additional borrowings
on the Credit Facility.
Under present SBIC regulations, the maximum amount of SBA-guaranteed
debentures that may be issued by multiple licensees under common management is $225.0 million. An affiliate of GC Advisors manages
another SBIC. As such, it is possible that GC SBIC IV, L.P., our wholly owned SBIC subsidiary, will be constrained in its ability
to issue SBA-guaranteed debentures in the future if the other affiliated SBIC has already issued such debentures. As of June 30,
2012, the affiliated SBIC licensee had $90.7 million of SBA-guaranteed debentures outstanding, while GC SBIC IV, L.P. had $123.5
million of outstanding SBA-guaranteed debentures, leaving incremental borrowing capacity of a maximum of $10.8 million of SBA-guaranteed
debentures for GC SBIC IV, L.P. and the affiliated SBIC licensee. Unless specifically approved by the SBA, the other licensee was
prohibited by the SBA from making certain new investments when GC SBIC IV, L.P. received its license on August 24, 2010. The affiliated
SBIC licensee is limited to only making add-on investments in existing portfolio companies. As such, the majority of the incremental
borrowing capacity is available for GC SBIC IV, L.P. The borrowing capacity of GC SBIC IV, L.P. could be expanded further if the
affiliated SBIC retires its SBA-guaranteed debentures.
On February 2, 2012, we received a “Green Light”
letter from the SBA allowing us to proceed with an application for a second SBIC license and we submitted such an application to
the SBA on April 19, 2012. On May 18, 2012, we received an “Acceptance Letter” from the SBA notifying us
that the application had been accepted by the SBA for further processing. The application process is anticipated to take six to
twelve months. If approved, the additional license will provide us with an incremental source of attractive long-term capital.
In accordance with the 1940 Act, with certain limited exceptions,
we are only allowed to borrow amounts such that our asset coverage, as defined in the 1940 Act, is at least 200% after such borrowing.
On September 13, 2011, we received exemptive relief from the SEC allowing us to modify the asset coverage requirement to exclude
the SBA debentures from this calculation. As such, our ratio of total consolidated assets to outstanding indebtedness may be less
than 200%. This provides us with increased investment flexibility but also increases our risks related to leverage. As of June
30, 2012, our asset coverage for borrowed amounts was 282.1% (excluding the SBA debentures).
Although we expect to fund the growth of our investment portfolio
through the net proceeds from future securities offerings and through our dividend reinvestment plan as well as future borrowings,
to the extent permitted by the 1940 Act, we cannot assure you that our efforts to raise capital will be successful. In addition
to capital not being available, it also may not be available on favorable terms.
We believe that our existing cash and cash equivalents and available
borrowings as of June 30, 2012 will be sufficient to fund our anticipated requirements through at least June 30, 2013.
Portfolio Composition, Investment Activity and Yield
As of June 30, 2012 and September 30, 2011, we had investments
in 116 and 103 portfolio companies, respectively, with a total value of $636.6 million and $459.8 million, respectively. The following
table shows the asset mix of our new originations for the three and nine months ended June 30, 2012 and 2011:
|
|
Three months ended June 30,
|
|
|
Nine months ended June 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
|
|
(In thousands)
|
|
|
Percentage of
Commitments
|
|
|
(In thousands)
|
|
|
Percentage of
Commitments
|
|
|
(In thousands)
|
|
|
Percentage of
Commitments
|
|
|
(In thousands)
|
|
|
Percentage of
Commitments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior secured
|
|
$
|
48,040
|
|
|
|
91.7
|
%
|
|
$
|
65,459
|
|
|
|
48.2
|
%
|
|
$
|
136,242
|
|
|
|
43.2
|
%
|
|
$
|
76,830
|
|
|
|
25.3
|
%
|
One stop
|
|
|
2,500
|
|
|
|
4.8
|
|
|
|
47,712
|
|
|
|
35.1
|
|
|
|
99,968
|
|
|
|
31.8
|
|
|
|
67,527
|
|
|
|
22.2
|
|
Second lien
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
32,636
|
|
|
|
10.4
|
|
|
|
50,204
|
|
|
|
16.5
|
|
Subordinated debt
|
|
|
1,707
|
|
|
|
3.3
|
|
|
|
21,369
|
|
|
|
15.8
|
|
|
|
37,490
|
|
|
|
11.9
|
|
|
|
104,065
|
|
|
|
34.2
|
|
Equity securities
|
|
|
116
|
|
|
|
0.2
|
|
|
|
1,265
|
|
|
|
0.9
|
|
|
|
8,515
|
|
|
|
2.7
|
|
|
|
5,464
|
|
|
|
1.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total new investment commitments
|
|
$
|
52,363
|
|
|
|
100.0
|
%
|
|
$
|
135,805
|
|
|
|
100.0
|
%
|
|
$
|
314,851
|
|
|
|
100.0
|
%
|
|
$
|
304,090
|
|
|
|
100.0
|
%
|
For the three and nine months ended June 30, 2012, we had approximately
$34.2 million and $114.4 million in proceeds from principal payments of portfolio companies, respectively. For the three
and nine months ended June 30, 2012, we had sales of securities in zero and seven portfolio companies aggregating approximately
zero and $6.2 million, respectively.
For the three and nine months ended June 30, 2011, we had approximately
$33.5 million and $108.9 million in debt repayments, respectively. For the three and nine months ended June 30, 2011,
we had sales of securities in 19 and 37 portfolio companies aggregating approximately $46.2 million and $80.1 million, respectively.
The following table shows the par, amortized cost and fair value
of our portfolio of investments excluding derivative instruments by asset class:
|
|
As of June 30, 2012
(1)
|
|
|
As of September 30, 2011
(1)
|
|
|
|
|
|
|
Amortized
|
|
|
Fair
|
|
|
|
|
|
Amortized
|
|
|
Fair
|
|
|
|
Par
|
|
|
Cost
|
|
|
Value
|
|
|
Par
|
|
|
Cost
|
|
|
Value
|
|
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior secured:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing
|
|
$
|
258,716
|
|
|
$
|
254,267
|
|
|
$
|
255,943
|
|
|
$
|
203,647
|
|
|
$
|
201,018
|
|
|
$
|
200,940
|
|
Non-accrual
(2)
|
|
|
6,862
|
|
|
|
6,856
|
|
|
|
2,808
|
|
|
|
9,078
|
|
|
|
8,711
|
|
|
|
2,891
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
One stop:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing
|
|
|
237,506
|
|
|
|
233,973
|
|
|
|
236,827
|
|
|
|
178,854
|
|
|
|
176,393
|
|
|
|
177,880
|
|
Non-accrual
(2)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second lien
(3)
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing
|
|
|
48,783
|
|
|
|
47,157
|
|
|
|
48,448
|
|
|
|
21,922
|
|
|
|
21,531
|
|
|
|
21,922
|
|
Non-accrual
(2)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subordinated debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing
|
|
|
73,022
|
|
|
|
71,848
|
|
|
|
73,179
|
|
|
|
46,804
|
|
|
|
45,888
|
|
|
|
46,804
|
|
Non-accrual
(2)
|
|
|
2,870
|
|
|
|
2,810
|
|
|
|
1,435
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
N/A
|
|
|
|
18,341
|
|
|
|
17,992
|
|
|
|
N/A
|
|
|
|
9,420
|
|
|
|
9,390
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
627,759
|
|
|
$
|
635,252
|
|
|
$
|
636,632
|
|
|
$
|
460,305
|
|
|
$
|
462,961
|
|
|
$
|
459,827
|
|
|
(1)
|
Sixteen and fourteen of our loans included a feature permitting a portion of the interest due on such loan to be PIK interest
as of June 30, 2012 and September 30, 2011, respectively.
|
|
(2)
|
We refer to a loan as non-accrual when we cease recognizing interest income on the loan because we have stopped pursuing repayment
of the loan or, in certain circumstances, it is past due 90 days or more on principal and interest or our management has reasonable
doubt that principal or interest will not be collected. See "—Critical Accounting Policies— Revenue Recognition."
|
|
(3)
|
Second lien loans included $16.0 million and $12.3 million of loans structured as first lien last out term loans as of June
30, 2012 and September 30, 2011, respectively.
|
The following table shows the weighted average rate, spread
over LIBOR of floating rate, fixed rate and fees of investments originated and the weighted average rate of sales and payoffs of
portfolio companies during the three and nine months ended June 30, 2012 and 2011:
|
|
Three
months ended June 30,
|
|
|
Nine
months ended June 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
Weighted average rate of new investment fundings
(1)(2)
|
|
|
8.2
|
%
|
|
|
8.7
|
%
|
|
|
9.3
|
%
|
|
|
8.7
|
%
|
Weighted average spread over LIBOR of new floating rate investment
fundings
(1)(2)
|
|
|
6.7
|
%
|
|
|
6.4
|
%
|
|
|
7.1
|
%
|
|
|
6.4
|
%
|
Weighted average rate of new fixed rate investment fundings
|
|
|
8.0
|
%
|
|
|
13.7
|
%
|
|
|
13.6
|
%
|
|
|
13.6
|
%
|
Weighted average fees of new investment fundings
|
|
|
1.7
|
%
|
|
|
1.5
|
%
|
|
|
1.9
|
%
|
|
|
1.6
|
%
|
Weighted average rate of sales and payoffs of portfolio companies
|
|
|
6.7
|
%
|
|
|
5.7
|
%
|
|
|
7.2
|
%
|
|
|
6.2
|
%
|
(1) For the three and nine months ended June 30, 2012, we have
excluded $20.4 million of broadly syndicated loans held for short term investment purposes. These loans had a weighted average
rate of 2.6% and a weighted average spread over LIBOR of 2.2%. Had we included the broadly syndicated loans in these rates, for
the three and nine months ended June 30, 2012, our weighted average rate of new investments would have been 5.9% and 8.8%, respectively,
and our weighted average spread over LIBOR would have been 4.8% and 6.7%, respectively.
(2) For the three and nine months ended June 30, 2011, we have
excluded $22.0 million of broadly syndicated loans held for short term investment purposes. These loans had a weighted average
rate of 3.9% and a weighted average spread over LIBOR of 3.3%. Had we included the broadly syndicated loans in these rates, for
the three and nine months ended June 30, 2011, our weighted average rate of new investments would have been 7.8% and 8.1%, respectively,
and our weighted average spread over LIBOR would have been 5.3% and 5.7%, respectively.
For the three and nine months ended June 30, 2012, the weighted
average annualized interest income (which excludes income resulting from amortization of fees and discounts) yield on the fair
value of income producing loans in our portfolio was 9.3% and 9.4%, respectively. For the three and nine months ended June 30,
2011, the weighted average annualized interest income (which excludes income resulting from amortization of fees and discounts)
yield on the fair value of income producing investments in our portfolio were 8.6% and 8.6%, respectively. As of June 30, 2012,
81.2% and 80.5% of our portfolio at fair value and at cost, respectively, had interest rate floors that limit the minimum applicable
interest rates on such loans. As of September 30, 2011, 78.8% and 79.0% of our portfolio at fair value and at cost, respectively,
had interest rate floors that limited minimum interest rates on such loans.
GC Advisors regularly assesses the risk profile of each of our
investments and rates each of them based on an internal system developed by Golub Capital and its affiliates. This system
is not generally accepted in our industry or used by our competitors. It is based on the following categories, which
we refer to as GC Advisors’ investment performance rating:
Risk Ratings Definition
|
Rating
|
|
Definition
|
5
|
|
Involves the least amount of risk in our portfolio. The borrower is performing above expectations and the trends and risk factors are generally favorable.
|
|
|
|
4
|
|
Involves an acceptable level of risk that is similar to the risk at the time of origination. The borrower is generally performing as expected and the risk factors are neutral to favorable.
|
|
|
|
3
|
|
Involves a borrower performing below expectations and indicates that the loan’s risk has increased somewhat since origination. The borrower may be out of compliance with debt covenants; however, loan payments are generally not past due.
|
|
|
|
2
|
|
Involves a borrower performing materially below expectations and indicates that the loan’s risk has increased materially since origination. In addition to the borrower being generally out of compliance with debt covenants, loan payments may be past due (but generally not more than 180 days past due).
|
|
|
|
1
|
|
Involves a borrower performing substantially below expectations and indicates that the loan’s risk has substantially increased since origination. Most or all of the debt covenants are out of compliance and payments are substantially delinquent. Loans rated 1 are not anticipated to be repaid in full and we will reduce the fair market value of the loan to the amount we anticipate will be recovered.
|
The following table shows the distribution of our investments
on the 1 to 5 investment performance rating scale at fair value as of June 30, 2012 and September 30, 2011.
|
|
|
June 30, 2012
|
|
|
September 30, 2011
|
|
Investment
|
|
|
Investments
|
|
|
Percentage of
|
|
|
Investments
|
|
|
Percentage of
|
|
Performance
|
|
|
at Fair Value
|
|
|
Total
|
|
|
at Fair Value
|
|
|
Total
|
|
Rating
|
|
|
(In thousands)
|
|
|
Investments
|
|
|
(In thousands)
(1)
|
|
|
Investments
|
|
5
|
|
|
$
|
138,479
|
|
|
|
21.7
|
%
|
|
$
|
49,691
|
|
|
|
10.8
|
%
|
4
|
|
|
|
437,319
|
|
|
|
68.7
|
|
|
|
360,259
|
|
|
|
78.7
|
|
3
|
|
|
|
56,168
|
|
|
|
8.8
|
|
|
|
45,141
|
|
|
|
9.9
|
|
2
|
|
|
|
341
|
|
|
|
0.1
|
|
|
|
2,891
|
|
|
|
0.6
|
|
1
|
|
|
|
4,325
|
|
|
|
0.7
|
|
|
|
-
|
|
|
|
-
|
|
Total
|
|
|
$
|
636,632
|
|
|
|
100.0
|
%
|
|
$
|
457,982
|
|
|
|
100.0
|
%
|
|
(1)
|
As of September 30, 2011, the TRS was included in the above table with an investment performance rating of 4. The fair value
of the TRS as of September 30, 2011 was $(1.8) million.
|
Contractual Obligations and Off-Balance Sheet Arrangements
A summary of our significant contractual payment obligations
as of June 30, 2012 is as follows:
|
|
Payments Due by Period (In millions)
|
|
|
|
|
|
|
Less Than
|
|
|
|
|
|
|
|
|
More Than
|
|
|
|
Total
|
|
|
1 Year
|
|
|
1-3 Years
|
|
|
3-5 Years
|
|
|
5 Years
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt Securitization
|
|
$
|
174.0
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
174.0
|
|
SBA debentures
|
|
|
123.5
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
123.5
|
|
Credit Facility
|
|
|
32.3
|
|
|
|
-
|
|
|
|
-
|
|
|
|
32.3
|
|
|
|
-
|
|
Unfunded commitments
(1)
|
|
|
52.0
|
|
|
|
52.0
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Total contractual obligations
|
|
$
|
381.8
|
|
|
$
|
52.0
|
|
|
$
|
-
|
|
|
$
|
32.3
|
|
|
$
|
297.5
|
|
(1) Unfunded commitments represent all amounts unfunded as of
June 30, 2012. These amounts may or may not be funded to the borrowing party now or in the future. The unfunded commitments relate
to loans with various maturity dates, but we are showing this amount in the less than one year category, as this entire amount
was eligible for funding to the borrowers as of June 30, 2012.
The notes offered in the Debt Securitization are scheduled to
mature on July 20, 2021. The SBA debentures are scheduled to mature between March 2021 and March 2022. The Credit Facility is scheduled
to mature on October 21, 2015.
We may become a party to financial instruments with off-balance
sheet risk in the normal course of our business to meet the financial needs of our portfolio companies. These instruments may include
commitments to extend credit and involve, to varying degrees, elements of liquidity and credit risk in excess of the amount recognized
in the balance sheet. As of June 30, 2012 and September 30, 2011, we had outstanding commitments to fund investments totaling $52.0
million and $49.4 million, respectively.
Our ten-year U.S. Treasury futures contracts contain elements
of off-balance sheet market and credit risk. Such derivative instruments can be affected by market conditions, such as interest
rate volatility, which could impact the fair value of our derivative instruments. If market conditions move against us, we may
not achieve the anticipated benefits of these derivative instruments and may realize a loss. We minimize market risk through monitoring
our investments. In addition to market risk, we have credit risk that a counterparty will not be able to meet its obligations to
us. It is our policy to review, as necessary, the credit standing of each counterparty.
We have certain contracts under which we have material future
commitments. We have entered into the Investment Advisory Agreement with GC Advisors in accordance with the 1940 Act. The Investment
Advisory Agreement became effective upon the pricing of our initial public offering and was amended and restated on July 16, 2010
in order to offset fees payable in connection with the Debt Securitization against the base management fee. Under the Investment
Advisory Agreement, GC Advisors provides us with investment advisory and management services. For these services, we pay (1) a
management fee equal to a percentage of the average adjusted value of our gross assets and (2) an incentive fee based on our performance.
To the extent that GC Advisors or any of its affiliates provides investment advisory, collateral management or other similar services
to a subsidiary of ours, we intend to reduce the base management fee by an amount equal to the product of (1) the total fees paid
to GC Advisors by such subsidiary for such services and (2) the percentage of such subsidiary’s total equity that is owned,
directly or indirectly, by us.
We also entered into the Administration Agreement with GC Service
as our administrator on April 14, 2010. Under the Administration Agreement, GC Service furnishes us with office facilities and
equipment, provides us clerical, bookkeeping and record keeping services at such facilities and provides us with other administrative
services necessary to conduct our day-to-day operations. We reimburse GC Service for the allocable portion (subject to the review
and approval of our board of directors) of overhead and other expenses incurred by it in performing its obligations under the Administration
Agreement, including rent, the fees and expenses associated with performing compliance functions and our allocable portion of the
cost of our chief financial officer and chief compliance officer and their respective staffs. GC Service also provides on our behalf
significant managerial assistance to those portfolio companies to which we are required to offer to provide such assistance.
If any of the contractual obligations discussed above are terminated,
our costs under any new agreements that we enter into may increase. In addition, we would likely incur significant time and expense
in locating alternative parties to provide the services we receive under our Investment Advisory Agreement and our Administration
Agreement. Any new investment advisory agreement would also be subject to approval by our stockholders.
Distributions
In order to qualify as a RIC and to avoid corporate-level U.S.
federal income tax on the income we distribute to our stockholders, we are required under the Code to distribute at least 90% of
our net ordinary income and net short-term capital gains in excess of net long-term capital losses, if any, to our net stockholders
on an annual basis. Additionally, we must meet the annual distribution requirements of the U.S. federal excise tax rules. We intend
to distribute quarterly distributions to our stockholders as determined by our board of directors.
We may not be able to achieve operating results that will allow
us to make distributions at a specific level or to increase the amount of our distributions from time to time. In addition, we
may be limited in our ability to make distributions due to the asset coverage requirements applicable to us as a business development
company under the 1940 Act. If we do not distribute a certain percentage of our income annually, we will suffer adverse U.S. federal
income tax consequences, including the possible loss of our qualification as a RIC. We cannot assure stockholders that they will
receive any distributions.
To the extent our taxable earnings fall below the total
amount of our distributions for that fiscal year, a portion of those distributions may be deemed a return of capital to our
stockholders for U.S. federal income tax purposes. Thus, the source of a distribution to our stockholders may be the original
capital invested by the stockholder rather than our income or gains. Stockholders should read any written disclosure
accompanying a dividend payment carefully and should not assume that the source of any distribution is our ordinary income or
gains. We believe a portion of the distributions paid to stockholders for the quarter ended June 30, 2012 represented a
return of capital.
We have adopted an “opt out” dividend reinvestment
plan for our common stockholders. As a result, if we declare a distribution, then our stockholders’ cash distributions will
be automatically reinvested in additional shares of our common stock unless a stockholder specifically “opts out” of
our dividend reinvestment plan. If a stockholder opts out, that stockholder will receive cash distributions. Although distributions
paid in the form of additional shares of our common stock will generally be subject to U.S. federal, state and local taxes in the
same manner as cash distributions, stockholders participating in our dividend reinvestment plan will not receive any corresponding
cash distributions with which to pay any such applicable taxes.
Related Party Transactions
We have entered into a number of business relationships with
affiliated or related parties, including the following:
|
·
|
We have entered into the Investment Advisory Agreement with GC Advisors. Mr. Lawrence Golub, our chairman, is a manager of
GC Advisors, and Mr. David Golub, our chief executive officer, is a manager of GC Advisors, and each of Messrs. Lawrence Golub
and David Golub owns an indirect pecuniary interest in GC Advisors.
|
|
·
|
GC Service provides us with the office facilities and administrative services necessary to conduct day-to-day operations pursuant
to our Administration Agreement.
|
|
·
|
We have entered into a license agreement with Golub Capital LLC, pursuant to which Golub Capital LLC has granted us a non-exclusive,
royalty-free license to use the name “Golub Capital.”
|
|
·
|
Under a staffing agreement, or Staffing Agreement, between Golub Capital and GC Advisors, Golub Capital has agreed to provide
GC Advisors with the resources necessary to fulfill its obligations under the Investment Advisory Agreement. The Staffing Agreement
provides that Golub Capital will make available to GC Advisors experienced investment professionals and access to the senior investment
personnel of Golub Capital for purposes of evaluating, negotiating, structuring, closing and monitoring our investments. The Staffing
Agreement also includes a commitment that the members of GC Advisors’ investment committee will serve in such capacity. Services
under the Staffing Agreement are provided on a direct cost reimbursement basis.
|
|
·
|
In our common stock offering that closed on February 3, 2012, Golub Capital Employee Grant Program Rabbi Trust, a trust organized
for the purpose of awarding equity incentive compensation to employees of Golub Capital, purchased an aggregate of $3.1 million
of shares at the public offering price per share. In addition, in the same offering, Mr. William M. Webster IV, one of our directors,
purchased 15,000 shares at the public offering price per share, and Mr. John T. Baily, one of our directors, purchased $75,000
of shares at the public offering price per share. The same trust also invested $3.1 million through open market purchases from March 1, 2012 through June
30, 2012.
|
|
·
|
GC Advisors irrevocably waived $0.6 million of the incentive fee payable by us to GC Advisors for the three months ended December
31, 2011, representing the difference between (1) the incentive fee attributable to the TRS if the spread between the interest
received on the reference assets underlying the TRS and the interest paid to Citibank on the settled notional value of the TRS
were to be treated as part of the income component of the incentive fee and (2) the incentive fee attributable to the TRS if such
interest spread were to be treated as part of the capital gains component of such incentive fee.
|
GC Advisors also sponsors or manages, and may in the future
sponsor or manage, other investment funds, accounts or investment vehicles, collectively referred to as accounts, that have investment
mandates that are similar, in whole or in part, with ours. GC Advisors and its affiliates may determine that an investment is appropriate
for us and for one or more of those other accounts. In such event, depending on the availability of such investment and other appropriate
factors, and pursuant to GC Advisors’ allocation policy, GC Advisors or its affiliates may determine that we should invest
side-by-side with one or more other accounts. We do not intend to make any investments if they are not permitted by applicable
law and interpretive positions of the SEC and its Staff, or if they are inconsistent with GC Advisors’ allocation procedures.
In addition, we have adopted a formal code of ethics that governs
the conduct of our and GC Advisors’ officers, directors and employees. Our officers and directors also remain subject to
the duties imposed by both the 1940 Act and the General Corporation Law of the State of Delaware.
Critical Accounting Policies
The preparation of financial statements and related disclosures
in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the periods
reported. Actual results could materially differ from those estimates. We have identified the following items as critical accounting
policies.
Valuation of Investments
We value investments for which market quotations are readily
available at their market quotations. However, a readily available market value is not expected to exist for many of the investments
in our portfolio, and we value these portfolio investments at fair value as determined in good faith by our board of directors
under our valuation policy and process. We may seek pricing information with respect to certain of our investments from pricing
services or brokers or dealers in order to value such investments. We also employ independent third party valuation firms for all
of our investments for which there is not a readily available market value.
Valuation methods may include comparisons of the portfolio companies
to peer companies that are public, the enterprise value of a portfolio company, the nature and realizable value of any collateral,
the portfolio company’s ability to make payments and its earnings, discounted cash flow, the markets in which the portfolio
company does business and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent
equity sale occurs, we will consider the pricing indicated by the external event to corroborate the private equity valuation. Due
to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the
fair value of the investments may differ significantly from the values that would have been used had a readily available market
value existed for such investments and may differ materially from values that may ultimately be received or settled.
Our board of directors is ultimately and solely responsible
for determining, in good faith, the fair value of investments that are not publicly traded, whose market prices are not readily
available on a quarterly basis or any other situation where portfolio investments require a fair value determination.
With respect to investments for which market quotations are
not readily available, our board of directors undertakes a multi-step valuation process each quarter, as described below:
|
·
|
Our quarterly valuation process begins with each portfolio company or investment being initially valued by the investment professionals
of GC Advisors responsible for credit monitoring.
|
|
·
|
Preliminary valuation conclusions are then documented and discussed with our senior management and GC Advisors.
|
|
·
|
The audit committee of our board of directors reviews these preliminary valuations.
|
|
·
|
At least once annually, the valuation for each portfolio investment is reviewed by an independent valuation firm.
|
|
·
|
Our board of directors discusses valuations and determines the fair value of each investment in our portfolio in good faith.
|
The factors that are taken into account in fair value pricing
investments include: available current market data, including relevant and applicable market trading and transaction comparables;
applicable market yields and multiples; security covenants; call protection provisions; information rights; the nature and realizable
value of any collateral; the portfolio company’s ability to make payments, its earnings and discounted cash flows and the
markets in which it does business; comparisons of financial ratios of peer companies that are public; comparable merger and acquisition
transactions; and the principal market and enterprise values.
Determination of fair values involves subjective judgments and
estimates not verifiable by auditing procedures. Under current auditing standards, the notes to our consolidated financial statements
refer to the uncertainty with respect to the possible effect of such valuations, and any change in such valuations, on our consolidated
financial statements.
We follow Accounting Standards Codification Topic 820,
Fair
Value Measurements and Disclosures
, as amended, for measuring fair value. Fair value is the price that would be received in
the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
Where available, fair value is based on observable market prices or parameters, or derived from such prices or parameters. Where
observable prices or inputs are not available, valuation models are applied. These valuation models involve some level of management
estimation and judgment, the degree of which is dependent on the price transparency for the assets or liabilities or market and
the assets’ or liabilities’ complexity. Our fair value analysis includes an analysis of the value of any unfunded loan
commitments. Assets and liabilities are categorized for disclosure purposes based upon the level of judgment associated with the
inputs used to measure their value. The valuation hierarchical levels are based upon the transparency of the inputs to the valuation
of the asset or labiality as of the measurement date. The three levels are defined as follows:
Level 1:
Inputs are unadjusted,
quoted prices in active markets for identical assets or liabilities at the measurement date.
Level 2:
Inputs include quoted
prices for similar assets or liabilities in active markets and inputs that are observable for the assets or liabilities, either
directly or indirectly, for substantially the full term of the assets or liabilities.
Level 3:
Inputs include significant
unobservable inputs for the assets or liabilities and include situations where there is little, if any, market activity for the
assets or liabilities. The inputs into the determination of fair value are based upon the best information available and may require
significant management judgment or estimation.
In certain cases, the inputs used to measure fair value may
fall into different levels of the fair value hierarchy. In such cases, an asset’s or a liability’s categorization within
the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment
of the significance of a particular input to the fair value measurement in its entirety requires judgment, and we consider factors
specific to the asset or liability. We assess the levels of investments at each measurement date, and transfers between levels
are recognized on the actual date of the event or change in circumstances that caused the transfers. There were no transfers among
Level 1, 2 and 3 investments during the nine months ended June 30, 2012 and 2011. The following section describes the valuation
techniques used by us to measure different assets and liabilities at fair value and includes the level within the fair value hierarchy
in which the assets and liabilities are categorized.
Cash and cash equivalents held at large financial institutions
and futures contracts that are valued based on quoted market prices in active markets are categorized in Level 1 of the fair value
hierarchy. All other assets and liabilities as of June 30, 2012 and September 30, 2011 were valued using Level 3 inputs of the
fair value hierarchy. Level 1 assets and liabilities are valued using quoted market prices. Level 2 assets and liabilities are
valued using market consensus prices that are corroborated by observable market data and quoted market prices for similar assets
and liabilities. Level 3 assets and liabilities are valued at fair value as determined in good faith by our board of directors,
based on input of management, the audit committee and independent valuation firms that have been engaged at the direction of our
board of directors to assist in the valuation of each portfolio investment without a readily available market quotation at least
once during a trailing twelve-month period under a valuation policy and a consistently applied valuation process. This valuation
process is conducted at the end of each fiscal quarter, with approximately 25% (based on fair value) of our valuation of debt and
equity securities without readily available market quotations subject to review by an independent valuation firm.
When valuing Level 3 debt and equity investments, we may take
into account the following factors, where relevant, in determining the fair value of the investments: the enterprise value of a
portfolio company, the nature and realizable valuable of any collateral, the portfolio company’s ability to make payments
and its earnings and discounted cash flows, the markets in which the portfolio company does business, comparisons to publicly traded
securities, and changes in the interest rate environment and the credit markets generally that may affect the price at which similar
investments may be made and other relevant factors. In addition, for certain debt and equity investments, we may base our valuation
on indicative bid and ask prices provided by an independent third party pricing service. Bid prices reflect the highest price that
we and others may be willing to pay. Ask prices represent the lowest price that we and others may be willing to accept for an investment.
We generally uses the midpoint of the bid/ask range as our best estimate of fair value of such investment.
Fair value of our debt is estimated by discounting remaining
payments using applicable market rates or market quotes for similar instruments at the measurement date, if available.
Due to the inherent uncertainty of determining the fair value
of Level 3 assets and liabilities that do not have a readily available market value, the fair value of the assets and liabilities
may differ significantly from the values that would have been used had a market existed for such assets and liabilities and may
differ materially from the values that may ultimately be received or settled. Further, such assets and liabilities are generally
subject to legal and other restrictions or otherwise are less liquid than publicly traded instruments. If we were required to liquidate
a portfolio investment in a forced or liquidation sale, we may realize significantly less than the value at which such investment
had previously been recorded.
Our investments, borrowings and derivatives are subject to market
risk. Market risk is the potential for changes in the value due to market changes. Market risk is directly impacted by the volatility
and liquidity in the markets in which the investments, borrowings and derivatives are traded.
Revenue Recognition:
Our revenue recognition policies are as follows:
Investments and Related Investment Income:
Our
board of directors determines the fair value of our portfolio of investments. Interest income is accrued based upon the outstanding
principal amount and contractual interest terms of debt investments. Premiums, discounts, and origination fees are amortized or
accreted into interest income over the life of the respective debt investment. For investments with contractual PIK interest, which
represents contractual interest accrued and added to the principal balance that generally becomes due at maturity, we do not accrue
PIK interest if the portfolio company valuation indicates that the PIK is not likely to be collectible. Dividend income on preferred
equity securities is recorded as dividend income on an accrual basis to the extent that such amounts are payable by the portfolio
company and are expected to be collected. Dividend income on common equity securities is recorded on the record date for private
portfolio companies or on the ex-dividend date for publicly traded portfolio companies.
We account for investment transactions on a trade-date basis.
Realized gains or losses on investments are measured by the difference between the net proceeds from the disposition and the cost
basis of investment, without regard to unrealized gains or losses previously recognized. We report changes in fair value of investments
that are measured at fair value as a component of the net change in unrealized appreciation (depreciation) on investments in our
consolidated statement of operations.
We record the fair value of the futures contracts based on
the unrealized gain or loss of the reference securities of the futures contracts. Upon maturity or settlement of the futures contracts,
we will realize a gain or loss based on the difference of the fair value of the futures contracts at inception and the fair value
of the futures contracts at settlement or maturity. This gain or loss would be included on the consolidated statements of operations
as net realized gain (loss) on derivative instruments.
We recorded the fair value of our investment in the TRS based
on the unrealized gain or loss of the reference securities of the TRS. For GAAP purposes, realized gains and losses on the TRS
were composed of any gains or losses on the referenced portfolio of loans as well as the net interest received or owed at the
time of the quarterly settlement. For GAAP purposes, unrealized gains and losses on the TRS were composed of the net interest
income earned or interest expense owed during the period that was not previously settled as well as the change in fair value of
the referenced portfolio of loans.
Non-accrual:
Loans may be left on accrual
status during the period we are pursuing repayment of the loan. Management reviews all loans that become past due 90 days or more
on principal and interest or when there is reasonable doubt that principal or interest will be collected for possible placement
on non-accrual status. We generally reverse accrued interest when a loan is placed on non-accrual. Interest payments received on
non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment. We restore non-accrual
loans to accrual status when past due principal and interest is paid and, in our management’s judgment, are likely to remain
current. The total fair value of our non-accrual loans was $4.2 million and $2.9 million as of June 30, 2012 and September 30,
2011, respectively.
Income taxes:
We have elected to be treated as a RIC under Subchapter M of
the Code and operate in a manner so as to qualify for the U.S. federal income tax treatment applicable to RICs. In order to qualify
as a RIC, we are required to meet certain source of income and asset diversification requirements and timely distribute to our
stockholders at least 90% of investment company taxable income, as defined by the Code, each year. We have made and intend to continue
to make the requisite distributions to our stockholders, which will generally relieve us from U.S. federal income taxes.
Depending on the level of taxable income earned in a tax year,
we may choose to carry forward taxable income in excess of current year distributions into the next tax year and pay a 4% excise
tax on such income, as required. To the extent that we determine that our estimated current year annual taxable income will be
in excess of estimated current year distributions, we accrue excise tax, if any, on estimated excess taxable income as taxable
income is earned.
Because U.S. federal income tax regulations differ from GAAP,
distributions in accordance with such tax regulations may differ from net investment income and realized gains recognized for financial
reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified within capital accounts in
the financial statements to reflect their U.S. federal income tax character. Temporary differences arise when certain items of
income, expense, gain or loss are recognized at some time in the future. Differences in classification may also result from the
treatment of short-term gains as ordinary income for U.S. federal income tax purposes.
Item 3: Quantitative and Qualitative Disclosures About Market
Risk.
We are subject to financial market risks, including changes
in interest rates. During the period covered by our predecessor’s financial statements, many of the loans in our portfolio
had floating interest rates, and we expect that our loans in the future may also have floating interest rates. These loans are
usually based on a floating LIBOR and typically have interest rate re-set provisions that adjust applicable interest rates under
such loans to current market rates on a quarterly basis. In addition, the Class A Notes issued as a part of the Debt Securitization
have a floating interest rate provision based on 3-month LIBOR that resets quarterly and the Credit Facility has a floating interest
rate provision based on 1-month LIBOR that resets daily, and we expect that other credit facilities into which we enter in the
future may have floating interest rate provisions.
Assuming that the consolidated statement of financial condition
as of June 30, 2012 were to remain constant and that we took no actions to alter our existing interest rate sensitivity, the following
table shows the annualized impact of hypothetical base rate changes in interest rates.
|
|
Increase (decrease) in
|
|
|
Increase (decrease) in
|
|
|
Net
|
|
Change in interest rates
|
|
interest income
|
|
|
interest expense
|
|
|
increase (decrease)
|
|
|
|
(in thousands)
|
|
Down 25 basis points
|
|
$
|
(105
|
)
|
|
$
|
(516
|
)
|
|
$
|
411
|
|
Up 100 basis points
|
|
|
677
|
|
|
|
2,063
|
|
|
|
(1,386
|
)
|
Up 200 basis points
|
|
|
5,473
|
|
|
|
4,126
|
|
|
|
1,347
|
|
Up 300 basis points
|
|
|
10,800
|
|
|
|
6,189
|
|
|
|
4,611
|
|
Although we believe that this analysis is indicative of our
existing sensitivity to interest rate changes, it does not adjust for changes in the credit market, credit quality, the size and
composition of the assets in our portfolio and other business developments, including borrowing under the Debt Securitization or
other borrowings, that could affect net increase in net assets resulting from operations, or net income. Accordingly, we can offer
no assurances that actual results would not differ materially from the analysis above.
We entered into ten-year U.S. Treasury futures contracts to
mitigate our risks associated with a rising ten-year U.S. Treasury rate. These futures contracts insulate us against adverse changes
in such rate, but also limit our ability to participate in the benefits of lower interest rates.
We may in the future hedge against interest rate fluctuations
by using standard hedging instruments such as futures, options and forward contracts. While hedging activities may insulate us
against adverse changes in interest rates, they may also limit our ability to participate in the benefits of lower interest rates
with respect to the investments in our portfolio with fixed interest rates.
Item 4: Controls and Procedures.
As of the period covered by this report, we, including our chief
executive officer and chief financial officer, evaluated the effectiveness of the design and operation of our disclosure controls
and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on our evaluation, our management, including the chief
executive officer and chief financial officer, concluded that our disclosure controls and procedures were effective in timely alerting
management, including the chief executive officer and chief financial officer, of material information about us required to be
included in our periodic SEC filings. However, in evaluating the disclosure controls and procedures, management recognized that
any controls and procedures, no matter how well designed and operated, are based upon certain assumptions about the likelihood
of future events and can provide only reasonable assurance of achieving the desired control objectives, and management necessarily
was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. There has not
been any change in our internal controls over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred
during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal
controls over financial reporting.
Part II – Other Information
Item 1: Legal Proceedings.
Although we may, from time to time, be involved in litigation
arising out of our operations in the normal course of business or otherwise, we are currently not a party to any pending material
legal proceedings.
Item 1A: Risk Factors.
None.
Item 2: Unregistered Sales of Equity Securities and Use of
Proceeds.
None.
Item 3: Defaults Upon Senior Securities.
None.
Item 4: Removed and Reserved.
Item 5: Other Information.
None.
Item 6: Exhibits.
EXHIBIT INDEX
Number
|
Description
|
|
|
31.1
|
Certifications by Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
|
|
|
31.2
|
Certifications by Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
|
|
|
32.1
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
|
_________________
* Filed herewith
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
Golub Capital BDC, Inc.
|
|
|
|
Dated: August 6, 2012
|
By
|
/s/ David B. Golub
|
|
|
David B. Golub
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
|
|
|
Dated: August 6, 2012
|
By
|
/s/ Ross A. Teune
|
|
|
Ross A. Teune
|
|
|
Chief Financial Officer
|
|
|
(Principal Accounting and Financial Officer)
|
Golub Capital BDC (NASDAQ:GBDC)
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