Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q
(Mark One)
 
ý
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2018
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 814-00813

OFS CAPITAL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware
 
46-1339639
State or Other Jurisdiction of
 
I.R.S. Employer Identification No.
Incorporation or Organization
 
 
 
 
 
10 S. Wacker Drive, Suite 2500, Chicago, Illinois
 
60606
Address of Principal Executive Offices
 
Zip Code
 
 
 
 
(847) 734-2000
 
Registrant’s Telephone Number, Including Area Code
 
 
 
Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

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

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
¨
Accelerated filer
ý
 
 
 
 
Non-accelerated filer
¨  (do not check if a smaller reporting company)
Smaller reporting company
¨
 
 
 
 
Emerging growth company
¨
 
 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨     No  ý

The number of shares of the issuer’s Common Stock, $0.01 par value, outstanding as of August 1, 2018 was 13,350,458.



OFS CAPITAL CORPORATION

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

2


Defined Terms
We have used "we," "us," "our," "our company," and "the Company" to refer to OFS Capital Corporation in this report. We also have used several other terms in this report, which are explained or defined below:
Term
Explanation or Definition
1940 Act
Investment Company Act of 1940, as amended
Administration Agreement
Administration Agreement between the Company and OFS Services dated November 7, 2012
Annual Distribution Requirement
Distributions to our stockholders, for each taxable year, of at least 90% of our ICTI
ASC
Accounting Standards Codification, as issued by the FASB
ASU
Accounting Standards Updates, as issued by the FASB
BDC
Business Development Company under the 1940 Act
BLA
Business Loan Agreement, as amended, with Pacific Western Bank, as lender, which provides the Company with a senior secured revolving credit facility
Board
The Company's board of directors
CLO
Collateralized loan obligation funds
Code
Internal Revenue Code of 1986, as amended
DRIP
Distribution reinvestment plan
EBITDA
Earnings before interest, taxes, depreciation, and amortization
Exchange Act
Securities Exchange Act of 1934, as amended
FASB
Financial Accounting Standards Board
GAAP
Accounting principles generally accepted in the United States
HPCI
Hancock Park Corporate Income, Inc., a Maryland corporation and non-traded BDC for whom OFS Advisor serves as investment adviser
ICTI
Investment company taxable income, which is generally net ordinary income plus net short-term capital gains in excess of net long-term capital losses
Investment Advisory Agreement
Investment Advisory and Management Agreement between the Company and OFS Advisor dated November 7, 2012
IPO
Initial Public Offering
LIBOR
London Interbank Offered Rate
Net Loan Fees
The cumulative amount of fees, such as discounts, premiums and amendment fees that are deferred and recognized as income over the life of the loan.
Offering
The April 2017 follow-on public offering 3,625,000 shares of our common stock at an offering price of $14.57 per share.
OFS Advisor
OFS Capital Management, LLC, a wholly owned subsidiary of OFSAM and registered investment advisor under the 1940 Act
OFS Capital WM
OFS Capital WM, LLC, a wholly owned investment company subsidiary
OFS Services
OFS Capital Services, LLC, a wholly owned subsidiary of OFSAM and affiliate of OFS Advisor
OFSAM
Orchard First Source Asset Management, LLC, a full-service provider of capital and leveraged finance solutions to U.S. corporations
PIK
Payment-in-kind, non-cash interest or dividends payable as an addition to the loan or equity security producing the income.
Prime Rate
United States Prime interest rate
PWB Credit Facility
Senior secured revolving credit facility between the Company and Pacific Western Bank, as lender
RIC
Regulated investment company under the Code
SBA
U.S. Small Business Administration
SBCAA
Small Business Credit Availability Act
SBIC
A fund licensed under the SBA small business investment company program

3


Term
Explanation or Definition
SBIC Acquisition
The Company's acquisition of the remaining ownership interests in SBIC I LP and OFS SBIC I GP, LLC on December 4, 2013
SBIC Act
Small Business Investment Act of 1958
SBIC I LP
OFS SBIC I, LP, a wholly owned SBIC subsidiary of the Company
SEC
U.S. Securities and Exchange Commission
Securities Act
Securities Act of 1933, as amended
Stock Repurchase Program
The open market stock repurchase program for shares of the Company’s common stock under Rule 10b-18 of the Exchange Act
Unsecured Notes
The Company’s $50.0 million aggregate principal amount of 6.375% notes due April 30, 2025

4


Forward-Looking Statements
This quarterly report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about us, our current and prospective portfolio investments, our industry, our beliefs, and our assumptions. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “would,” “should,” “targets,” “projects,” and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including without limitation:
our ability and experience operating a BDC or an SBIC, or maintaining our tax treatment as a RIC under Subchapter M of the Code;
our dependence on key personnel;
our ability to maintain or develop referral relationships;
our ability to replicate historical results;
the ability of OFS Advisor to identify, invest in and monitor companies that meet our investment criteria;
actual and potential conflicts of interest with OFS Advisor and other affiliates of OFSAM;
constraint on investment due to access to material nonpublic information;
restrictions on our ability to enter into transactions with our affiliates;
limitations on the amount of SBA-guaranteed debentures that may be issued by an SBIC;
our ability to comply with SBA regulations and requirements;
the use of borrowed money to finance a portion of our investments;
competition for investment opportunities;
the ability of SBIC I LP and any other portfolio companies to make distributions enabling us to meet RIC requirements;
our ability to raise debt or equity capital as a BDC;
the timing, form and amount of any distributions from our portfolio companies;
the impact of a protracted decline in the liquidity of credit markets on our business;
the general economy and its impact on the industries in which we invest;
uncertain valuations of our portfolio investments; and
the effect of new or modified laws or regulations governing our operations, including the ability to incur additional leverage under the Small Business Credit Availability Act.
Although we believe that the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those assumptions also could be inaccurate. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this Quarterly Report on Form 10-Q should not be regarded as a representation by us that our plans and objectives will be achieved. These risks and uncertainties include, among others, those described or identified in “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2017. You should not place undue reliance on these forward-looking statements, which apply only as of the date of this Quarterly Report on Form 10-Q.
We have based the forward-looking statements on information available to us on the date of this Quarterly Report on Form 10-Q. Except as required by the federal securities laws, 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 in the future may file with the SEC, including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. The forward-looking statements and projections contained in this Quarterly Reports on Form 10-Q are excluded from the safe harbor protection provided by Section 27A of the Securities Act, and Section 21E of the Exchange Act.

5


PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
OFS Capital Corporation and Subsidiaries
Consolidated Balance Sheets
(Dollar amounts in thousands, except per share data)

June 30,
2018

December 31,
2017

(unaudited)


Assets





Investments, at fair value:





Non-control/non-affiliate investments (amortized cost of $249,111 and $209,360, respectively)
$
241,071


$
197,374

Affiliate investments (amortized cost of $106,689 and $70,402, respectively)
111,017


69,557

Control investments (amortized cost of $10,275 and $10,213, respectively)
10,744


10,568

Total investments at fair value (amortized cost of $366,075 and $289,975, respectively)
362,832


277,499

Cash and cash equivalents
22,665


72,952

Interest receivable
2,919


2,734

Prepaid expenses and other assets
4,257


4,593

Total assets
$
392,673


$
357,778







Liabilities





Revolving line of credit
$
8,000


$
17,600

SBA debentures (net of deferred debt issuance costs of $2,470 and $2,657, respectively)
147,410


147,223

Unsecured notes (net of deferred debt issuance costs of $1,701 and $0, respectively)
48,299



Interest payable
2,260


1,596

Management and incentive fees payable
2,683


1,987

Administration fee payable
478


476

Accrued professional fees
444


433

Other liabilities
170


127

Total liabilities
209,744


169,442







Commitments and contingencies (Note 6)











Net assets





Preferred stock, par value of $0.01 per share, 2,000,000 shares authorized, -0- shares issued and outstanding as of June 30, 2018, and December 31, 2017, respectively
$


$

Common stock, par value of $0.01 per share, 100,000,000 shares authorized, 13,350,458 and 13,340,217 shares issued and outstanding as of June 30, 2018, and December 31, 2017, respectively
134


133

Paid-in capital in excess of par
187,549


187,398

Accumulated undistributed net investment income
7,088


9,404

Accumulated undistributed net realized gain (loss)
(8,497
)

3,881

Net unrealized depreciation on investments
(3,345
)

(12,480
)
Total net assets
182,929


188,336







Total liabilities and net assets
$
392,673


$
357,778







Number of shares outstanding
13,350,458


13,340,217

Net asset value per share
$
13.70


$
14.12


See Notes to Financial Statements.

6


OFS Capital Corporation and Subsidiaries
Consolidated Statements of Operations (unaudited)
(Dollar amounts in thousands, except per share data)

Three Months Ended June 30,

Six Months Ended June 30,

2018

2017

2018

2017
Investment income











Interest income:











Non-control/non-affiliate investments
$
6,326


$
4,446


$
12,084


$
9,058

Affiliate investments
2,768


1,646


4,853


3,477

Control investment
250


542


489


1,066

Total interest income
9,344


6,634


17,426


13,601

Payment-in-kind interest and dividend income:











Non-control/non-affiliate investments
122


319


346


626

Affiliate investments
285


374


746


726

Control investment
27


39


54


77

Total payment-in-kind interest and dividend income
434


732


1,146


1,429

Dividend income:











Non-control/non-affiliate investments


45




50

Affiliate investments




130


85

Control investments
94


137


127


170

Total dividend income
94


182


257


305

Fee income:











Non-control/non-affiliate investments
387


169


413


325

Affiliate investments
3


176


5


234

Control investments
16


85


34


118

Total fee income
406


430


452


677

Total investment income
10,278


7,978


19,281


16,012

Expenses











Interest expense
2,169


1,339


3,803


2,726

Management fee
1,548


1,224


2,908


2,416

Incentive fee
1,135


(22
)

1,872


1,159

Professional fees
200


293


401


556

Administration fee
358


307


941


708

Other expenses
310


521


1,005


791

Total expenses before incentive fee waiver
5,720


3,662


10,929


8,356

Incentive fee waiver (see Note 3)




(22
)


Total expenses, net of incentive fee waiver
5,720


3,662


10,907


8,356

Net investment income
4,558


4,316


8,374


7,656

Net realized and unrealized gain (loss) on investments











Net realized gain (loss) on non-control/non-affiliate investments
(5,464
)

163


(5,003
)

163

Net realized gain (loss) on affiliate investments
(3,477
)

874


(4,018
)

874

Net unrealized appreciation (depreciation) on non-control/non-affiliate investments
5,411


(5,505
)

3,848


(8,546
)
Net unrealized appreciation (depreciation) on affiliate investments
3,928


(3,366
)

5,173


658

Net unrealized appreciation on control investment
39


1,237


114


1,780

Net gain (loss) on investments
437


(6,597
)

114


(5,071
)
Net increase (decrease) in net assets resulting from operations
$
4,995


$
(2,281
)

$
8,488


$
2,585

Net investment income per common share – basic and diluted
$
0.34


$
0.33


$
0.63


$
0.67

Net increase (decrease) in net assets resulting from operations per common share – basic and diluted
$
0.37


$
(0.17
)

$
0.64


$
0.23

Distributions declared per common share
$
0.34


$
0.34


$
1.05


$
0.68

Basic and diluted weighted average shares outstanding
13,348,793


13,197,759


13,344,670


11,458,706

See Notes to Financial Statements.

7


OFS Capital Corporation and Subsidiaries
Consolidated Statements of Changes in Net Assets (unaudited)
(Dollar amounts in thousands)
 
Six Months Ended June 30,
 
2018
 
2017
Increase in net assets resulting from operations:
 
 
 
Net investment income
$
8,374


$
7,656

Net realized gain (loss) on investments
(9,021
)

1,037

Net unrealized appreciation (depreciation) on investments
9,135


(6,108
)
Net increase in net assets resulting from operations
8,488


2,585

 
 
 
 
Distributions to stockholders from:





Accumulated net investment income
(9,075
)

(7,830
)
Accumulated net realized gain (loss)
(4,936
)


Total distributions to stockholders
(14,011
)

(7,830
)
 
 
 
 
Common stock transactions:





Public offering of common stock, net of expenses

 
53,373

Reinvestment of stockholder distributions
116


90

Net increase in net assets resulting from capital transactions
116


53,463

 
 
 
 
Net increase (decrease) in net assets
(5,407
)

48,218

 
 
 
 
Net assets:





Beginning of period
188,336


143,778

End of period
$
182,929


$
191,996

 
 
 
 
Accumulated undistributed net investment income
$
7,088


$
6,888

 
 
 
 
Common stock activity:





Common stock issued from reinvestment of stockholder distributions
10,241


6,358

Common stock issued and outstanding at beginning of period
13,340,217


9,700,297

Common stock issued and outstanding at end of period
13,350,458


13,331,655


See Notes to Financial Statements.

8


OFS Capital Corporation and Subsidiaries
Consolidated Statements of Cash Flows (unaudited)
(Dollar amounts in thousands)
 
Six Months Ended June 30,
 
2018
 
2017
Cash flows from operating activities
 
 
 
Net increase in net assets resulting from operations
$
8,488


$
2,585

Adjustments to reconcile net increase in net assets resulting from operations to net cash used in operating activities:





Net realized loss (gain) on investments
9,021


(1,037
)
Net unrealized depreciation (appreciation) on investments
(9,135
)

6,108

Amortization of Net Loan Fees
(583
)

(669
)
Payment-in-kind interest and dividend income
(1,146
)

(1,428
)
Amortization of deferred debt issuance costs
332


260

Amortization of intangible asset
98


98

Purchase and origination of portfolio investments
(145,213
)

(72,219
)
Proceeds from principal payments on portfolio investments
19,161


51,409

Proceeds from sale or redemption of portfolio investments
42,657


2,400

Changes in other operating assets and liabilities:



 
Interest receivable
(185
)

520

Interest payable
664


(3
)
Management and incentive fees payable
696


(635
)
Administration fee payable
2


(66
)
Other assets and liabilities
277


(297
)
Net cash provided used in operating activities
(74,866
)

(12,947
)
 
 
 
 
Cash flows from financing activities
 
 
 
Proceeds from common stock offering, net of expenses

 
53,448

Distributions paid to stockholders
(13,895
)

(7,740
)
Borrowings under revolving line of credit
54,250


11,000

Repayments under revolving line of credit
(63,850
)

(14,500
)
Issuance of unsecured notes
48,247



Other financing activities
(173
)


Net cash provided by financing activities
24,579


42,208

Net increase (decrease) in cash and cash equivalents
(50,287
)

29,261

   Cash and cash equivalents — beginning of period
72,952


17,659

   Cash and cash equivalents — end of period
$
22,665


$
46,920

 
 
 
 
Supplemental Disclosure of Cash Flow Information:
 
 
 
Cash paid for interest
$
2,807


$
2,469

Distributions paid by issuance of common stock
116


90


See Notes to Financial Statements.

9

OFS Capital Corporation and Subsidiaries

Consolidated Schedule of Investments
June 30, 2018
(Dollar amounts in thousands)


Portfolio Company (1)
Investment Type
 
Industry
 
Interest Rate (2)
 
Spread Above Index (2)
 
Initial Acquisition Date
 
Maturity
 
Principal Amount
 
Amortized Cost
 
Fair Value (3)
 
Percent of Net Assets
Non-control/Non-affiliate Investments
 
 




















Armor Holdings II LLC

Other Professional, Scientific, and Technical Services




















Senior Secured Loan



11.10%

(L +9.00%)

7/20/2016

12/26/2020

$
3,500


$
3,480


$
3,500


1.9
%























Baymark Health Services, Inc.

Outpatient Mental Health & Sub. Abuse Centers




















Senior Secured Loan



10.57%

(L +8.25%)

3/22/2018

3/1/2025

4,000


3,962


3,979


2.2
























Carolina Lubes, Inc. (4)

Automotive Oil Change and Lubrication Shops




















Senior Secured Loan (8)



10.21%

(L +7.90%)

8/23/2017

8/23/2022

21,125


20,970


21,423


11.7

Senior Secured Loan (Revolver)



9.56%

(L +7.25%)

8/23/2017

8/23/2022

1,363


1,350


1,363


0.7













22,488

 
22,320

 
22,786

 
12.4

Cirrus Medical Staffing, Inc. (4)

Temporary Help Services




















Senior Secured Loan



10.58%

(L +8.25%)

3/5/2018

10/19/2022

7,729


7,657


7,668


4.2

Senior Secured Loan (Revolver)



10.58%

(L +8.25%)

3/5/2018

10/19/2022

128


128


117


0.1













7,857


7,785


7,785


4.3

Community Intervention Services, Inc. (4)

Outpatient Mental Health and Substance Abuse Centers




















Subordinated  Loan (6) (10) (11)



7.0% cash / 6.0% PIK

N/A

7/16/2015

1/16/2021

8,789


7,639




























Confie Seguros Holdings II Co.

Insurance Agencies and Brokerages




















Senior Secured Loan



11.81%

(L +9.50%)

7/7/2015

5/8/2019

9,678


9,615


9,473


5.2
























Constellis Holdings, LLC

Other Justice, Public Order, and Safety Activities




















Senior Secured Loan



11.33%

(L +9.00%)

4/28/2017

4/21/2025

9,950


9,823


10,050


5.5
























DuPage Medical Group

Offices of Physicians, Mental Health Specialists




















Senior Secured Loan



9.09%

(L +7.00%)

8/22/2017

8/15/2025

7,098


7,176


7,134


3.9

























10

OFS Capital Corporation and Subsidiaries

Consolidated Schedule of Investments - Continued
June 30, 2018
(Dollar amounts in thousands)


Portfolio Company (1)
Investment Type
 
Industry
 
Interest Rate (2)
 
Spread Above Index (2)
 
Initial Acquisition Date
 
Maturity
 
Principal Amount
 
Amortized Cost
 
Fair Value (3)
 
Percent of Net Assets
Eblens Holdings, Inc.

Shoe Store




















Subordinated Loan (11)



12.0% cash / 1.0% PIK

N/A

7/13/2017

1/13/2023

$
8,874


$
8,802


$
8,728


4.8
%
Common Equity (71,250 Class A units) (10)







7/13/2017






713


1,029


0.6













8,874


9,515


9,757


5.4

Elgin Fasteners Group

Bolt, Nut, Screw, Rivet, and Washer Manufacturing




















Senior Secured Loan



9.08%

(L +6.75%)

10/31/2011

8/27/2018

3,753


3,744


3,489


1.9
























GGC Aerospace Topco L.P.

Other Aircraft Parts and Auxiliary Equipment Manufacturing




















Senior Secured Loan



11.05%

(L +8.75%)

12/29/2017

9/8/2024

5,000


4,884


4,936


2.7

Common Equity (368,852 Class A units) (10)







12/29/2017






450


368


0.2

Common Equity (40,984 Class B units) (10)







12/29/2017






50


15















5,000


5,384


5,319


2.9

LRI Holding, LLC (4)

Electrical Contractors and Other Wiring Installation Contractors




















Senior Secured Loan



11.59%

(L +9.25%)

6/30/2017

6/30/2022

17,806


17,682


17,675


9.7

Preferred Equity (238,095 Series B units) (10)







6/30/2017



 

300


300


0.2













17,806


17,982


17,975


9.9

MAI Holdings, Inc. (4)

Printing Machinery and Equipment Manufacturing




















Senior Secured Loan



9.50%

N/A

6/21/2018

6/1/2023

5,000


5,000


5,000


2.7
























Maverick Healthcare Equity, LLC (4)

Home Health Equipment Rental




















Preferred Equity (1,250,000 units) (10)







12/10/2014






900


64



Common Equity (1,250,000 Class A units) (10)







12/10/2014


























900


64



My Alarm Center, LLC (4)

Security Systems Services (except Locksmiths)




















Preferred Equity (1,485 Class A units), 8% PIK (7) (10) (13)







7/14/2017






1,571


1,602


0.9

Preferred Equity (1,198 Class B units) (10) (13)







7/14/2017






1,198


245


0.1

Common Equity (64,149 units) (10) (13)







7/14/2017


























2,769


1,847


1.0


11

OFS Capital Corporation and Subsidiaries

Consolidated Schedule of Investments - Continued
June 30, 2018
(Dollar amounts in thousands)


Portfolio Company (1)
Investment Type
 
Industry
 
Interest Rate (2)
 
Spread Above Index (2)
 
Initial Acquisition Date
 
Maturity
 
Principal Amount
 
Amortized Cost
 
Fair Value (3)
 
Percent of Net Assets
O2 Holdings, LLC (4)

Fitness and Recreational Sports Centers




















Senior Secured Loan



15.09%

(L +13.00%)

9/2/2016

9/2/2021

$
13,850


$
13,519


$
13,850


7.6
%























Online Tech Stores, LLC (4)

Stationary & Office Supply Merchant Wholesaler




















Subordinated Loan



10.50% cash / 1.0% PIK

N/A

2/1/2018

8/1/2023

16,066


15,770


15,703


8.6
























Parfums Holding Company, Inc.

Cosmetics, Beauty Supplies, and Perfume Stores




















Senior Secured Loan



10.85%

(L +8.75%)

11/16/2017

6/30/2025

6,320


6,335


6,393


3.5




















Performance Team LLC (4)

General Warehousing and Storage




















Senior Secured Loan



12.09%

(L +10.00%)

5/24/2018

11/24/2023

20,300


20,101


20,101


11.0
























Planet Fitness Midwest LLC (4)

Fitness and Recreational Sports Centers




















Subordinated Loan



13.00%

N/A

6/16/2016

12/16/2021

5,000


4,969


4,987


2.7
























PM Acquisition LLC

All Other General Merchandise Stores
















Senior Secured Loan



11.50% cash / 1.0% PIK

N/A

9/30/2017

10/29/2021

5,520


5,456


5,358


2.9

Common Equity (499 units) (10) (13)







9/30/2017






499


263


0.1













5,520


5,955


5,621


3.0

Resource Label Group, LLC

Commercial Printing (except Screen and Books)




















Senior Secured Loan



10.80%

(L +8.50%)

6/7/2017

11/26/2023

4,821


4,761


4,728


2.6
























RPLF Holdings, LLC

Software Publishers




















Common Equity (254,110 Class A units) (10) (13)







1/17/2018






254


315


0.2
























Security Alarm Financing Enterprises, L.P. (4)

Security Systems Services (except Locksmiths)




















Subordinated Loan (14)



14.00% cash / 3.33% PIK

(L +14.00%)

10/14/2016

6/19/2020

12,588


12,521


12,701


6.9

 
 
 
 
 
 
 


 
 
 
 
 
 
 
 
 
 

12

OFS Capital Corporation and Subsidiaries

Consolidated Schedule of Investments - Continued
June 30, 2018
(Dollar amounts in thousands)


Portfolio Company (1)
Investment Type
 
Industry
 
Interest Rate (2)
 
Spread Above Index (2)
 
Initial Acquisition Date
 
Maturity
 
Principal Amount
 
Amortized Cost
 
Fair Value (3)
 
Percent of Net Assets
Sentry Centers Holdings, LLC

Other Professional, Scientific, and Technical Services




















Senior Secured Loan (15)



13.50%

(L +11.50%)

1/25/2016

7/24/2020

$
8,870


$
8,799


$
8,819


4.8
%
Preferred Equity (5,000 Series C units), 8% PIK (10) (13)



 
 
 

3/31/2014
 
 
 



548


962


0.5













8,870


9,347


9,781


5.3

Southern Technical Institute, LLC (4)

Colleges, Universities, and Professional Schools




















Subordinated Loan (6)(10)



6.00% PIK

N/A

6/27/2018

12/31/2021

1,471







Common Equity (1,764,720 Class A-1 units) (10)







6/27/2018























1,471







Stancor, L.P. (4)

Pump and Pumping Equipment Manufacturing




















Senior Secured Loan



10.09%

(L +8.00%)

8/19/2014

8/19/2019

11,093


11,078


11,093


6.1

Preferred Equity (1,250,000 Class A units), 8% PIK (7) (10)







8/19/2014






1,501


1,585


0.9













11,093


12,579


12,678


7.0

STS Operating, Inc.

Industrial Machinery and Equipment Merchant Wholesalers




















Senior Secured Loan



5.84%

(L +3.75%)

5/16/2018

12/11/2024

642


640


640


0.3

Senior Secured Loan



10.09%

(L +8.00%)

5/15/2018

4/30/2026

9,073


9,069


9,153


5.0













9,715


9,709


9,793


5.3

The Escape Game, LLC (4)

Other amusement and recreation industries




















Senior Secured Loan



10.84%

(L +8.75%)

12/22/2017

12/22/2022

7,000


6,953


6,934


3.8
























Truck Hero, Inc.

Truck Trailer Manufacturing




















Senior Secured Loan



10.34%

(L +8.25%)

5/30/2017

4/21/2025

7,014


6,974


7,060


3.9
























United Biologics Holdings, LLC (4)

Medical Laboratories




















Preferred Equity (151,787 units) (10)







4/16/2013






9


20



Warrants (29,374 units) (10)







7/26/12

3/05/2022 (12)




82


72

















91


92




13

OFS Capital Corporation and Subsidiaries

Consolidated Schedule of Investments - Continued
June 30, 2018
(Dollar amounts in thousands)


Portfolio Company (1)
Investment Type
 
Industry
 
Interest Rate (2)
 
Spread Above Index (2)
 
Initial Acquisition Date
 
Maturity
 
Principal Amount
 
Amortized Cost
 
Fair Value (3)
 
Percent of Net Assets
Wand Intermediate I LP

Automotive Body, Paint, and Interior Repair and Maintenance




















Senior Secured Loan



9.14%

(L +7.25%)

5/14/2018

9/19/2022

$
2,158


$
2,179


$
2,176


1.2
%























Total Non-control/Non-affiliate Investments











245,579


249,111


241,071


125.3

Affiliate Investments






















3rd Rock Gaming Holdings, LLC

Software Publishers




















Senior Secured Loan



9.59%

(L +7.50%)

3/13/2018

3/12/2023

21,875


21,567


21,589


11.8

Common Equity (2,547,250 units) (10) (13)







3/13/2018






2,547


2,218


1.2













21,875


24,114


23,807


13

All Metals Holding, LLC (4)

Metal Service Centers and Other Metal Merchant Wholesalers




















Senior Secured Loan



12.0% cash / 1.0% PIK

N/A

12/31/2014

12/28/2021

19,401


18,892


19,122


10.5

Common Equity (797,443 units) (10)







12/31/2014






523


2,252


1.2













19,401


19,415


21,374


11.7

Contract Datascan Holdings, Inc. (4)

Office Machinery and Equipment Rental and Leasing