UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED DECEMBER 31, 2007
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER: 814-00237
GLADSTONE CAPITAL CORPORATION
(Exact name of registrant as specified in its charter)
MARYLAND |
|
54-2040781 |
(State or other jurisdiction of incorporation or organization) |
|
(I.R.S. Employer Identification No.) |
|
|
|
1521 WESTBRANCH DRIVE, SUITE 200 |
||
MCLEAN, VIRGINIA 22102 |
||
(Address of principal executive office) |
||
|
|
|
(703) 287-5800 |
||
(Registrants 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 and (2) has been subject to such filing requirements for the past 90 days. Yes x No o.
Indicate by check mark whether the registrant is large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12 b-2 of the Exchange Act. (Check One):
Large accelerated filer o Accelerated filer x Non-accelerated filer o.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x .
Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date. The number of shares of the issuers Common Stock, $0.001 par value, outstanding as of February 5, 2008 was 20,637,574.
GLADSTONE CAPITAL CORPORATION
TABLE OF CONTENTS
GLADSTONE CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
(Unaudited)
|
|
December 31, 2007 |
|
September 30, 2007 |
|
||
ASSETS |
|
|
|
|
|
||
Non-Control/Non-Affiliate investments (Cost 12/31/07: $423,933,339; 9/30/07: $354,835,652) |
|
$ |
412,712,262 |
|
$ |
348,920,982 |
|
Control investments (Cost 12/31/07: $1,036,861; 9/30/07: $923,548) |
|
945,428 |
|
923,548 |
|
||
Total investments at fair value (Cost 12/31/07: $424,970,200; 9/30/07 $355,759,200) |
|
413,657,690 |
|
349,844,530 |
|
||
Cash and cash equivalents |
|
5,530,949 |
|
8,838,658 |
|
||
U.S. Treasury bill |
|
2,484,464 |
|
2,484,464 |
|
||
Interest receivable investments in debt securities |
|
2,272,634 |
|
2,425,555 |
|
||
Interest receivable employees |
|
|
|
21,417 |
|
||
Due from custodian |
|
4,816,186 |
|
3,230,385 |
|
||
Deferred financing fees |
|
132,292 |
|
186,270 |
|
||
Prepaid assets |
|
405,643 |
|
337,106 |
|
||
Other assets |
|
284,058 |
|
360,753 |
|
||
TOTAL ASSETS |
|
$ |
429,583,916 |
|
$ |
367,729,138 |
|
|
|
|
|
|
|
||
LIABILITIES |
|
|
|
|
|
||
Accounts payable |
|
$ |
7,257 |
|
$ |
6,013 |
|
Interest payable |
|
595,335 |
|
587,514 |
|
||
Administration fee due to Administrator (Refer to Note 4) |
|
211,675 |
|
237,510 |
|
||
Fees due to Adviser (Refer to Note 4) |
|
11,054 |
|
708,517 |
|
||
Borrowings under lines of credit |
|
161,831,000 |
|
144,440,000 |
|
||
Accrued expenses and deferred liabilities |
|
738,140 |
|
790,849 |
|
||
Funds held in escrow |
|
157,268 |
|
|
|
||
TOTAL LIABILITIES |
|
163,551,729 |
|
146,770,403 |
|
||
NET ASSETS |
|
$ |
266,032,187 |
|
$ |
220,958,735 |
|
|
|
|
|
|
|
||
ANALYSIS OF NET ASSETS |
|
|
|
|
|
||
Common stock, $0.001 par value, 50,000,000 shares authorized and 17,637,574 and 14,762,574 shares issued and outstanding, respectively |
|
$ |
17,638 |
|
$ |
14,763 |
|
Capital in excess of par value |
|
286,425,698 |
|
235,906,665 |
|
||
Notes receivable employees |
|
(9,224,176 |
) |
(9,230,502 |
) |
||
Net unrealized depreciation on investments |
|
(11,312,511 |
) |
(5,914,670 |
) |
||
Unrealized depreciation on derivative |
|
(302,239 |
) |
(291,686 |
) |
||
Accumulated undistributed net investment income |
|
427,777 |
|
474,165 |
|
||
TOTAL NET ASSETS |
|
$ |
266,032,187 |
|
$ |
220,958,735 |
|
NET ASSETS PER SHARE |
|
$ |
15.08 |
|
$ |
14.97 |
|
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL STATEMENTS.
2
GLADSTONE CAPITAL CORPORATION
CONSOLIDATED SCHEDULE
OF INVESTMENTS
AS OF DECEMBER 31, 2007
(UNAUDITED)
Company |
|
Industry |
|
Investment (1) |
|
Cost |
|
Fair Value |
||
|
|
|
|
|
|
|
|
|
||
NON-CONTROL/NON-AFFILIATE INVESTMENTS |
||||||||||
|
||||||||||
Access Television Network, Inc. (2) |
|
Service-cable airtime |
|
Senior Term Debt (6) |
|
$ |
2,487,458 |
|
$ |
2,401,437 |
|
|
(infomercials) |
|
(11.3% Due 3/2009) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
ActivStyle Acquisition Co. (2) |
|
Service-medical products |
|
Line of Credit (6) (9) |
|
600,000 |
|
594,750 |
||
|
|
distribution |
|
(9.5%, Due 7/2009) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
5,113,875 |
|
5,069,129 |
||
|
|
|
|
(9.5%, Due 9/2012) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
4,435,000 |
|
4,390,650 |
||
|
|
|
|
(12.1%, Due 9/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Allison Publications, LLC (2) |
|
Service-publisher of consumer |
|
Line of Credit (10) |
|
|
|
|
||
|
|
oriented magazines |
|
(9.3%, Due 12/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
11,080,085 |
|
10,917,500 |
||
|
|
|
|
(9.3%, Due 12/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Anitox Acquisition Company (2) |
|
Manufacturing-preservatives for |
|
Senior Real Estate Term Debt |
|
3,107,161 |
|
3,060,000 |
||
|
|
animal feed |
|
(8.8%, Due 1/2012) |
|
|
|
|
||
|
|
|
|
Line of Credit (11) |
|
|
|
|
||
|
|
|
|
(9.5%, Due 1/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
2,750,000 |
|
2,729,375 |
||
|
|
|
|
(9.5%, Due 1/2012) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
2,750,000 |
|
2,725,938 |
||
|
|
|
|
(11.8%, Due 1/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Badanco Acquisition Corp. |
|
Service-luggage design and |
|
Senior Subordinated Term Debt (6) |
|
9,603,750 |
|
9,531,722 |
||
|
|
distribution |
|
(12.0%, Due 7/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Bresnan Communications, LLC |
|
Service-telecommunications |
|
Senior Term Debt (7) |
|
3,001,724 |
|
2,872,500 |
||
|
|
|
|
(7.1%, Due 9/2013) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
1,509,619 |
|
1,470,000 |
||
|
|
|
|
(9.4%, Due 3/2014) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
CCS, LLC |
|
Service-cable tv franchise owner |
|
Senior Term Debt (6) |
|
3,426,892 |
|
3,341,220 |
||
|
|
|
|
(11.3%, Due 3/2008) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
CHG Companies, Inc. (2) |
|
Service-healthcare staffing |
|
Letter of Credit (6) (7) |
|
400,000 |
|
380,000 |
||
|
|
|
|
(7.2%, Due 12/2012) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) (7) |
|
1,588,000 |
|
1,508,600 |
||
|
|
|
|
(7.7%, Due 12/2012) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (6) (7) |
|
500,000 |
|
470,000 |
||
|
|
|
|
(11.2%, Due 12/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Chinese Yellow Pages Company |
|
Service-publisher of Chinese |
|
Line of Credit (6) (12) |
|
430,071 |
|
425,770 |
||
|
|
language directories |
|
(11.3%, Due 9/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
840,030 |
|
820,154 |
||
|
|
|
|
(11.3%, Due 9/2010) |
|
|
|
|
||
3
Company |
|
Industry |
|
Investment (1) |
|
Cost |
|
Fair Value |
||
|
|
|
|
|
|
|
|
|
||
Clinton Holdings, LLC (2) |
|
Distribution-aluminum sheets |
|
Senior Subordinated Term Debt |
|
$ |
15,500,000 |
|
$ |
15,779,000 |
|
|
and stainless steel |
|
(13)(12.5%, Due 1/2013) |
|
|
|
|
||
|
|
|
|
Common Stock Warrants (8) |
|
109,124 |
|
|
||
|
|
|
|
|
|
|
|
|
||
CMI Acquisition, LLC (2) |
|
Service-recycling |
|
Senior Subordinated Term Debt (6) |
|
6,500,000 |
|
6,386,250 |
||
|
|
|
|
(11.9%, Due 11/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Community Media Corporation |
|
Service-publisher of free |
|
Senior Term Debt (6) |
|
2,985,889 |
|
2,931,519 |
||
|
|
weekly newspapers |
|
(9.3%, Due 8/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Country Road Communications LLC |
|
Service-telecommunications |
|
Senior Subordinated Term Debt (7) |
|
5,968,659 |
|
5,910,000 |
||
(2) |
|
|
|
(12.6%, Due 7/2013) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Defiance Acquisition Corporation |
|
Manufacturing-trucking parts |
|
Senior Term Debt (3) (6) |
|
6,325,000 |
|
6,008,750 |
||
|
|
|
|
(13.2%, Due 4/2010) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Doe & Ingalls Management LLC (2) |
|
Distributor-specialty chemicals |
|
Senior Term Debt (6) |
|
3,700,000 |
|
3,690,750 |
||
|
|
|
|
(8.7%, Due 11/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
4,443,750 |
|
4,421,531 |
||
|
|
|
|
(9.7%, Due 11/2010) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Emdeon Business Services, Inc. |
|
Service-healthcare technology |
|
Senior Term Debt (6) (7) |
|
2,377,974 |
|
2,256,879 |
||
|
|
solutions |
|
(6.8%, Due 11/2013) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (6) (7) |
|
2,012,476 |
|
1,920,000 |
||
|
|
|
|
(9.8%, Due 5/2014) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Express Courier International, Inc. |
|
Service-ground delivery and logistics |
|
Line of Credit (6) (14) |
|
700,000 |
|
695,625 |
||
|
|
|
|
(9.5%, Due 6/2009) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
3,877,500 |
|
3,853,266 |
||
|
|
|
|
(9.5%, Due 6/2011) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
3,950,000 |
|
3,910,500 |
||
|
|
|
|
(11.7%, Due 6/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Finn Corporation |
|
Manufacturing-landscape equipment |
|
Common Stock Warrants (8) |
|
37,000 |
|
3,034,551 |
||
|
|
|
|
|
|
|
|
|
||
GFRC Holdings LLC |
|
Manufacturing-glass-fiber |
|
Line of Credit (5) (15) |
|
|
|
|
||
|
|
reinforced concrete |
|
(9.5%, Due 12/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (5) |
|
7,750,000 |
|
7,750,000 |
||
|
|
|
|
(9.7%, Due 12/2012) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (3) (5) |
|
6,750,000 |
|
6,750,000 |
||
|
|
|
|
(12.2%, Due 12/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Global Materials Technologies, Inc. |
|
Manufacturing-steel wool products |
|
Senior Term Debt (3) (6) |
|
5,050,000 |
|
4,816,438 |
||
|
|
and metal fibers |
|
(14.2%, Due 11/2009) |
|
|
|
|
||
4
Company |
|
Industry |
|
Investment (1) |
|
Cost |
|
Fair Value |
||
|
|
|
|
|
|
|
|
|
||
GTM Holdings, Inc. (2) |
|
Manufacturing-socks |
|
Senior Term Debt (7) |
|
$ |
495,000 |
|
$ |
465,300 |
|
|
|
|
(7.7%, Due 10/2013) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
500,000 |
|
485,000 |
||
|
|
|
|
(11.0%, Due 4/2014) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Greatwide Logistics Services, Inc. |
|
Service - logistics and transportation |
|
Senior Term Debt (7) |
|
3,960,000 |
|
3,326,400 |
||
|
|
|
|
(8.3%, Due 12/2013) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
4,000,000 |
|
2,800,000 |
||
|
|
|
|
(11.3%, Due 6/2014) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
GS Maritime Intermediate Holdings |
|
Service-cargo transport |
|
Senior Subordinated Term Debt (7) |
|
1,000,000 |
|
1,000,000 |
||
LLC |
|
|
|
(12.8%, Due 12/2013) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Harrington Holdings, Inc. (2) |
|
Service - healthcare products |
|
Senior Term Debt (7) |
|
2,481,250 |
|
2,382,000 |
||
|
|
distribution |
|
(7.0%, Due 1/2014) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
5,000,000 |
|
4,825,000 |
||
|
|
|
|
(10.8%, Due 1/2014) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Heartland Communications Group, |
|
Service-radio station operator |
|
Line of Credit (6) (16) |
|
9,856 |
|
8,871 |
||
LLC (2) |
|
|
|
(10.8%, Due 5/2008) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
4,761,113 |
|
4,241,569 |
||
|
|
|
|
(10.8%, Due 5/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Interfilm Holdings, Inc. |
|
Service-slitter and distributor of plastic |
|
Senior Term Debt (6) |
|
5,000,000 |
|
4,962,500 |
||
|
|
films |
|
(11.7%, Due 10/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
IJGT Acquisition Company |
|
Service-golf training |
|
Line of Credit (6) (17) |
|
|
|
|
||
|
|
|
|
(9.5%, Due 5/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
2,650,000 |
|
2,626,813 |
||
|
|
|
|
(9.5%, Due 5/2012) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
2,500,000 |
|
2,468,750 |
||
|
|
|
|
(11.7%, Due 5/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Its Just Lunch International, LLC |
|
Service-dating service |
|
Line of Credit (6) (18) |
|
550,000 |
|
467,500 |
||
|
|
|
|
(9.2%, Due 6/2009) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
3,300,000 |
|
2,805,000 |
||
|
|
|
|
(9.5%, Due 6/2011) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) (18) |
|
500,000 |
|
425,000 |
||
|
|
|
|
(11.7%, Due 6/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
John Henry Holdings, Inc. (2) |
|
Manufacturing-packaging products |
|
Senior Subordinated Term Debt (7) |
|
8,000,000 |
|
7,760,000 |
||
|
|
|
|
(11.6%, Due 6/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Kinetek Acquisition Corp. |
|
Manufacturing-custom engineered |
|
Senior Term Debt (7) |
|
1,490,262 |
|
1,440,450 |
||
|
|
motors & controls |
|
(7.3%, Due 11/2013) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
1,508,531 |
|
1,410,000 |
||
|
|
|
|
(10.3%, Due 5/2014) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
KMBQ Corporation |
|
Service-AM/FM radio broadcaster |
|
Line of Credit (19) |
|
152,000 |
|
150,480 |
||
|
|
|
|
(12.3%, Due 3/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
1,811,305 |
|
1,776,546 |
||
|
|
|
|
(12.3%, Due 3/2010) |
|
|
|
|
||
5
Company |
|
Industry |
|
Investment (1) |
|
Cost |
|
Fair Value |
||
|
|
|
|
|
|
|
|
|
||
Lindmark Outdoor Advertising LLC |
|
Service-advertising |
|
Senior Subordinated Term Debt (6) |
|
$ |
10,000,000 |
|
$ |
9,950,000 |
|
|
|
|
(11.3%, Due 10/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
LocalTel, Inc. |
|
Service-yellow pages publishing |
|
Line of Credit (6) (20) (29) |
|
1,170,000 |
|
819,000 |
||
|
|
|
|
(non-accrual, Due 6/2009) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) (29) |
|
2,687,500 |
|
1,881,250 |
||
|
|
|
|
(non-accrual, Due 6/2011) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) (29) |
|
2,750,000 |
|
1,925,000 |
||
|
|
|
|
(non-accrual, Due 6/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Macfadden Performing Arts |
|
Service-magazine publisher |
|
Line of Credit (6) (21) |
|
1,015,979 |
|
1,002,010 |
||
Media, LLC |
|
|
|
(9.8%, Due 6/2009) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
6,594,503 |
|
6,442,678 |
||
|
|
|
|
(9.8%, Due 6/2009) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Meteor Holding Corporation (2) |
|
Manufacturing-bar code scanning and |
|
Senior Term Debt (7) |
|
2,342,300 |
|
2,201,762 |
||
|
|
data capture |
|
(7.8%, Due 12/2013) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
1,500,000 |
|
1,380,000 |
||
|
|
|
|
(11.0%, Due 12/2013) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Multi-Ag Media LLC (2) |
|
Service-dairy magazine publisher/ |
|
Senior Term Debt (6) |
|
2,442,735 |
|
2,396,213 |
||
|
|
information database |
|
(11.3%, Due 12/2009) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Newhall Holdings, Inc.(2) |
|
Service-distributor of personal care |
|
Line of Credit (6) (22) |
|
|
|
|
||
|
|
products and supplements |
|
(8.7%, Due 5/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
4,410,000 |
|
4,376,925 |
||
|
|
|
|
(9.0%, Due 5/2012) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
4,500,000 |
|
4,455,000 |
||
|
|
|
|
(11.3%, Due 5/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Northern Contours, Inc. (2) |
|
Manufacturing-veneer and laminate |
|
Senior Subordinated Term Debt (6) |
|
7,000,000 |
|
6,912,500 |
||
|
|
components |
|
(12.2%, Due 5/2010) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Pinnacle Treatment Centers, Inc. |
|
Service-Addiction treatment centers |
|
Line of Credit (23) |
|
|
|
|
||
|
|
|
|
(9.5%, Due 12/2009) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
2,500,000 |
|
2,475,000 |
||
|
|
|
|
(9.5%, Due 12/2011) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
4,500,000 |
|
4,432,500 |
||
|
|
|
|
(12.2%, Due 12/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Precision Acquisition Group |
|
Manufacturing-consumable |
|
Equipment Note (6) (24) |
|
671,850 |
|
671,850 |
||
Holdings, Inc. (2) |
|
components for the aluminum |
|
(9.7%, Due 10/2011) |
|
|
|
|
||
|
|
industry |
|
Senior Term Debt (6) |
|
5,000,000 |
|
5,000,000 |
||
|
|
|
|
(9.7%, Due 10/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
4,200,000 |
|
4,200,000 |
||
|
|
|
|
(11.7%, Due 10/2010) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
PROFITSystems |
|
Service-design and develop |
|
Line of Credit (25) |
|
|
|
|
||
Acquisition Co. (2) |
|
ERP software |
|
(9.5%, Due 7/2009) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
2,650,000 |
|
2,630,125 |
||
|
|
|
|
(9.5%, Due 7/2011) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
2,900,000 |
|
2,871,000 |
||
|
|
|
|
(11.7%, Due 7/2011) |
|
|
|
|
||
6
Company |
|
Industry |
|
Investment (1) |
|
Cost |
|
Fair Value |
||
|
|
|
|
|
|
|
|
|
||
Puerto Rico Cable |
|
Service-telecommunications |
|
Senior Subordinated Term Debt (6) (7) |
|
$ |
7,794,854 |
|
$ |
7,117,580 |
Acquisition Company, Inc. |
|
|
|
(12.4%, Due 1/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
RCS Management Holding Co. |
|
Service-healthcare supplies |
|
Senior Term Debt (3) (6) |
|
3,000,000 |
|
2,835,000 |
||
|
|
|
|
(9.7%, Due 1/2011) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (4) (6) |
|
3,000,000 |
|
2,775,000 |
||
|
|
|
|
(12.2%, Due 1/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Reading Broadcasting, Inc. |
|
Service-television station operator |
|
Senior Term Debt (6) |
|
7,529,715 |
|
7,489,875 |
||
|
|
|
|
(11.8%, Due 3/2008) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
RedPrairie Holding, Inc. (2) |
|
Service-design and develop supply |
|
Senior Term Debt (7) |
|
4,435,000 |
|
4,257,600 |
||
|
|
chain software |
|
(8.0%, Due 7/2012) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
3,000,000 |
|
2,880,000 |
||
|
|
|
|
(11.4%, Due 1/2013) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Reliable Biopharmaceutical Holdings, |
|
Manufacturing-pharmaceutical and |
|
Line of Credit (5) (26) |
|
|
|
|
||
Inc. |
|
biochemical intermediates |
|
(8.7%, Due 10/2010) |
|
|
|
|
||
|
|
|
|
Mortgage Note (5) |
|
7,453,881 |
|
7,453,881 |
||
|
|
|
|
(9.5%, Due 10/2014) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (5) |
|
1,800,000 |
|
1,800,000 |
||
|
|
|
|
(9.2%, Due 10/2012) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (5) |
|
12,023,500 |
|
12,023,500 |
||
|
|
|
|
(11.2%, Due 10/2012) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (5) |
|
6,000,000 |
|
6,000,000 |
||
|
|
|
|
(12%, Due 10/2013) |
|
|
|
|
||
|
|
|
|
Common Stock Warrants (5) (8) |
|
208,675 |
|
208,675 |
||
|
|
|
|
|
|
|
|
|
||
RiskMetrics Group Holdings, LLC |
|
Service - develop risk and wealth |
|
Senior Term Debt (7) |
|
1,985,000 |
|
1,935,375 |
||
|
|
management solutions |
|
(7.0%, Due 1/2014) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
500,000 |
|
485,000 |
||
|
|
|
|
(10.3%, Due 7/2014) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
SCI Cable, Inc. |
|
Service-cable, internet, voice provider |
|
Senior Term Debt (6) |
|
2,727,090 |
|
2,574,500 |
||
|
|
|
|
(13.3%, Due 10/2008) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
SCS Acquisition Corp. (2) |
|
Service-chemically treated equipment |
|
Senior Term Debt (6) |
|
3,954,811 |
|
3,944,924 |
||
|
|
distribution |
|
(9.2%, Due 12/2011) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
6,475,000 |
|
6,442,625 |
||
|
|
|
|
(11.2%, Due 12/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Sunburst Media - Louisiana, LLC |
|
Service-radio station operator |
|
Senior Term Debt (6) |
|
7,872,831 |
|
7,683,000 |
||
|
|
|
|
(11.0%, Due 6/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Sunshine Media Holdings |
|
Service-publisher regional B2B trade |
|
Credit Facility (6) (27) |
|
700,000 |
|
692,125 |
||
|
|
magazines |
|
(9.2%, Due 5/2010) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
17,000,000 |
|
16,808,750 |
||
|
|
|
|
(9.2%, Due 5/2012) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
10,000,000 |
|
9,800,000 |
||
|
|
|
|
(12.7%, Due 5/2012) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Thibaut Acquisition Co. |
|
Service-design and disbribute |
|
Credit Facility (6) (28) |
|
1,000,000 |
|
995,000 |
||
|
|
wall covering |
|
(9.7%, Due 1/2011) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (6) |
|
2,537,500 |
|
2,524,813 |
||
|
|
|
|
(9.7%, Due 1/2011) |
|
|
|
|
||
|
|
|
|
Senior Term Debt (3) (6) |
|
3,000,000 |
|
2,973,750 |
||
|
|
|
|
(12.2%, Due 1/2011) |
|
|
|
|
||
7
Company |
|
Industry |
|
Investment (1) |
|
Cost |
|
Fair Value |
||
|
|
|
|
|
|
|
|
|
||
U.S. HealthCare Communications, |
|
Service-magazine publisher/operator |
|
Senior Term Debt (6) (29) |
|
$ |
2,432,869 |
|
$ |
1,684,140 |
LLC |
|
|
|
(non-accrual, Due 4/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Viapack, Inc. (2) |
|
Manufacturing-polyethylene film |
|
Senior Real Estate Term Debt (9.7%, Due 3/2011) |
|
925,000 |
|
925,000 |
||
|
|
|
|
Senior Term Debt (3) (6) |
|
4,170,313 |
|
4,118,184 |
||
|
|
|
|
(11.3%, Due 3/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Visual Edge Technology, Inc. (2) |
|
Service-office equipment distribution |
|
Senior Subordinated Term Debt (6) (13.2%, Due 8/2011) |
|
5,000,000 |
|
3,250,000 |
||
|
|
|
|
|
|
|
|
|
||
Wesco Holdings, Inc. (2) |
|
Service-aerospace parts and distribution |
|
Senior Term Debt (7) (7.0%, Due 9/2013) |
|
2,453,450 |
|
2,388,703 |
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
2,269,886 |
|
2,238,750 |
||
|
|
|
|
(11.6%, Due 3/2014) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
West Coast Yellow Pages, Inc. |
|
Service-directory publisher |
|
Senior Term Debt (6) |
|
1,538,743 |
|
1,399,716 |
||
|
|
|
|
(12.8%, Due 8/2010) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Westlake Hardware, Inc. (2) |
|
Retail-hardware and variety |
|
Senior Subordinated Term Debt (6) |
|
15,000,000 |
|
14,850,000 |
||
|
|
|
|
(11.7%, Due 1/2011) |
|
|
|
|
||
|
|
|
|
Senior Subordinated Term Debt (6) |
|
10,000,000 |
|
9,850,000 |
||
|
|
|
|
(13.6%, Due 1/2011) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Winchester Electronics |
|
Manufacturing-high bandwidth connectors and cables |
|
Senior Term Debt (6) (8.9%, Due 5/2013) |
|
1,995,000 |
|
1,975,050 |
||
|
|
|
|
Senior Subordinated Term Debt (6) |
|
10,000,000 |
|
9,862,500 |
||
|
|
|
|
(12.2%, Due 4/2013) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
WP Evenflo Group Holdings Inc. (2) |
|
Manufacturing-infant and juvenile products |
|
Senior Term Debt (7) (7.6%, Due 2/2013) |
|
1,985,000 |
|
1,925,450 |
||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
2,000,000 |
|
1,870,000 |
||
|
|
|
|
(11.0%, Due 2/2014) |
|
|
|
|
||
Total Non-Control/Non-Affiliate Investments |
|
|
|
$ |
423,933,339 |
|
$ |
412,712,262 |
||
|
|
|
|
|
|
|
|
|
||
CONTROL INVESTMENTS |
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
BERTL, Inc. |
|
Service-web-based evaluator of digital imaging products |
|
Line of Credit (30) (31) (11.5%, Due 10/2009) |
|
613,313 |
|
613,313 |
||
|
|
|
|
Common Stock (5) (8) |
|
423,548 |
|
332,115 |
||
Total Control Investments |
|
|
|
|
|
$ |
1,036,861 |
|
$ |
945,428 |
|
|
|
|
|
|
|
|
|
||
Total Investments |
|
|
|
|
|
$ |
424,970,200 |
|
$ |
413,657,690 |
(1) Percentage represents interest rates in effect at December 31, 2007 and due date represents the contractual maturity date.
(2) Certain of the listed securities are issued by affiliate(s) of the indicated portfolio company.
(3) Last Out Tranche of senior debt, meaning if the company is liquidated then the holder of the Last Out Tranche is paid after the senior debt.
(4) Last Out Tranche of senior debt, meaning if the company is liquidated then the holder of the Last Out Tranche is paid after the senior debt, however the debt is junior to another Last Out Tranche.
(5) Investment valued at cost due to recent acquisition.
(6) Fair value was based on opinions of value submitted by Standard & Poors Securities Evaluations, Inc.
(7) Marketable securities, such as syndicated loans, are valued based on the indicative bid price, as of December 31, 2007, from the respective originating syndication agents trading desk.
(8) Security is non-income producing.
(9) Availability under the ActivStyle credit facility totals $1,500,000. Borrowings of $600,000 were outstanding at December 31, 2007.
(10) Availability under the Allison credit facility totals $4,000,000. There were no borrowings outstanding at December 31, 2007.
(11) Availability under the Anitox credit facility totals $3,000,000. There were no borrowings outstanding at December 31, 2007.
8
(12) Availability under the Chinese Yellow Pages credit facility totals $700,000. Borrowings of $430,071 were outstanding at December 31, 2007.
(13) Clinton includes a success fee with a fair value of $279,000.
(14) Availability under the Express Courier credit facility totals $1,500,000. Borrowings of $700,000 were outstanding at December 31, 2007.
(15) Availability under the GFRC credit facility totals $3,000,000. There were no borrowings outstanding at December 31, 2007.
(16) Availability under the Heartland credit facility totals $500,000. Borrowings of $9,856 were outstanding at December 31, 2007.
(17) Availability under the International Junior Golf credit facility totals $1,500,000. There were no borrowings outstanding at December 31, 2007.
(18) Availability under the Its Just Lunch revolving credit facility totals $750,000, borrowings of $550,000 were outstanding at December 31, 2007. The company may borrow an additional $1,750,000 of the senior term debt facility, subject to certain conditions including Gladstone Capitals approval, borrowings of $500,000 were outstanding at December 31, 2007.
(19) Availability under the KMBQ credit facility totals $200,000. Borrowings of $152,000 were outstanding at December 31, 2007.
(20) Availability under the LocalTel credit facility totals $3,000,000. Borrowings of $1,170,000 were outstanding at December 31, 2007.
(21) Availability under the MacFadden credit facility totals $1,400,000. Borrowings of $1,015,979 were outstanding at December 31, 2007.
(22) Availability under the Newhall credit facility totals $4,000,000. There were no borrowings outstanding as of December 31, 2007.
(23) Availability under the Pinnacle credit facility totals $500,000. There were no borrowings outstanding at December 31, 2007.
(24) Precision may borrow up to $1,000,000 for purposes of acquiring equipment. Borrowings of $671,850 were outstanding at December 31, 2007.
(25) Availability under the ProfitSystems credit facility totals $1,250,000. There were no borrowings outstanding at December 31, 2007.
(26) Availability under the Reliable credit facility totals $5,000,000. There were no borrowings outstanding at December 31, 2007.
(27) Availability under the Sunshine credit facility totals $3,000,000. Borrowings of $700,000 were outstanding at December 31, 2007.
(28) Availability under the Thibaut credit facility totals $1,000,000. The facility was fully drawn at December 31, 2007.
(29) LocalTel and US Healthcare Communications are currently past due on interest payments and are on non-accrual.
(30) Availability under the BERTL credit facility totals $700,000. Borrowings of $613,313 were outstanding at December 31, 2007.
(31) BERTL interest is currently being capitalized as Paid in Kind (PIK) interest. Please refer to Note 2 Summary of Significant Accounting Policies.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL STATEMENTS.
9
GLADSTONE CAPITAL CORPORATION
CONSOLIDATED SCHEDULE OF INVESTMENTS
AS OF SEPTEMBER 30, 2007
Company |
|
Industry |
|
Investment (1) |
|
Cost |
|
Fair Value |
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
NON-CONTROL/NON-AFFILIATE INVESTMENTS |
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||
Access Television |
|
Service-cable airtime |
|
Line of Credit (9) |
|
$ |
|
|
$ |
|
|
|||
Network, Inc. (2) |
|
(infomercials) |
|
(11.8% Due 3/2009) |
|
|
|
|
|
|||||
|
|
|
|
Senior Term Debt (6) |
|
2,616,283 |
|
2,557,844 |
|
|||||
|
|
|
|
(11.8% Due 3/2009) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
ActivStyle Acquisition Co. (2) |
|
Service-medical products |
|
Line of Credit (6) (10) |
|
600,000 |
|
597,000 |
|
|||||
|
|
distribution |
|
(10.0%, Due 7/2009) |
|
|
|
|
|
|||||
|
|
|
|
Senior Term Debt (6) |
|
5,245,000 |
|
5,218,775 |
|
|||||
|
|
|
|
(10.0%, Due 9/2012) |
|
|
|
|
|
|||||
|
|
|
|
Senior Term Debt (3) (6) |
|
4,435,000 |
|
4,407,281 |
|
|||||
|
|
|
|
(12.6%, Due 9/2012) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
Allison Publications, LLC (2) |
|
Service-publisher of consumer |
|
Senior Term Debt (6) |
|
7,884,092 |
|
7,779,503 |
|
|||||
|
|
oriented magazines |
|
(9.8%, Due 12/2011) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
Anitox Acquisition Company (2) |
|
Manufacturing-preservatives for |
|
Senior Real Estate Term Debt |
|
3,110,050 |
|
3,060,000 |
|
|||||
|
|
animal feed |
|
(8.8%, Due 1/2012) |
|
|
|
|
|
|||||
|
|
|
|
Line of Credit (11) |
|
|
|
|
|
|||||
|
|
|
|
(10.0%, Due 1/2010) |
|
|
|
|
|
|||||
|
|
|
|
Senior Term Debt (6) |
|
2,750,000 |
|
2,736,250 |
|
|||||
|
|
|
|
(10.0%, Due 1/2012) |
|
|
|
|
|
|||||
|
|
|
|
Senior Term Debt (3) (6) |
|
2,750,000 |
|
2,736,250 |
|
|||||
|
|
|
|
(12.3%, Due 1/2012) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
Badanco Acquisition Corp. |
|
Service-luggage design and |
|
Senior Subordinated Term Debt (6) |
|
9,652,500 |
|
9,628,369 |
|
|||||
|
|
distribution |
|
(12.4%, Due 7/2012) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
Bresnan Communications, LLC |
|
Service-telecommunications |
|
Senior Term Debt (7) |
|
3,001,802 |
|
2,910,000 |
|
|||||
|
|
|
|
(7.4%, Due 9/2013) |
|
|
|
|
|
|||||
|
|
|
|
Senior Subordinated Term Debt (7) |
|
1,510,006 |
|
1,485,000 |
|
|||||
|
|
|
|
(9.9%, Due 3/2014) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
CCS, LLC |
|
Service-cable tv franchise owner |
|
Senior Term Debt (6) |
|
3,432,830 |
|
3,416,330 |
|
|||||
|
|
|
|
(11.8%, Due 10/2007) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
CHG Companies, Inc. (2) |
|
Service-healthcare staffing |
|
Letter of Credit (6) (7) |
|
400,000 |
|
385,000 |
|
|||||
|
|
|
|
(7.1%, Due 12/2012) |
|
|
|
|
|
|||||
|
|
|
|
Senior Term Debt (6) (7) |
|
1,588,000 |
|
1,528,450 |
|
|||||
|
|
|
|
(7.9%, Due 12/2012) |
|
|
|
|
|
|||||
|
|
|
|
Senior Subordinated Term Debt (6) (7) |
|
500,000 |
|
480,000 |
|
|||||
|
|
|
|
(11.9%, Due 12/2012) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
Chinese Yellow Pages Company |
|
Service-publisher of Chinese |
|
Line of Credit (6) (12) |
|
230,071 |
|
228,633 |
|
|||||
|
|
language directories |
|
(11.8%, Due 9/2010) |
|
|
|
|
|
|||||
|
|
|
|
Senior Term Debt (6) |
|
1,070,643 |
|
1,051,383 |
|
|||||
|
|
|
|
(11.8%, Due 9/2010) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
Clinton Holdings, LLC (2) |
|
Distribution-aluminum sheets |
|
Senior Subordinated Term Debt |
|
15,500,000 |
|
15,500,000 |
|
|||||
|
|
and stainless steel |
|
(13.0%, Due 1/2013) |
|
|
|
|
|
|||||
|
|
|
|
Common Stock Warrants (8) |
|
109,124 |
|
222,777 |
|
|||||
10
Company |
|
Industry |
|
Investment (1) |
|
Cost |
|
Fair Value |
|
||
|
|
|
|
|
|
|
|
|
|
||
CMI Acquisition, LLC (2) |
|
Service-recycling |
|
Senior Subordinated Term Debt (6) |
|
$ |
6,500,000 |
|
$ |
6,451,250 |
|
|
|
|
|
(12.4%, Due 11/2012) |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||
Community Media Corporation |
|
Service-publisher of free weekly |
|
Senior Term Debt (6) |
|
2,510,974 |
|
2,481,780 |
|
||
|
|
newspapers |
|
(9.8%, Due 8/2012) |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||
Country Road |
|
Service-telecommunications |
|
Senior Subordinated Term Debt (6) (7) |
|
5,967,246 |
|
5,880,000 |
|
||
Communications LLC (2) |
|
|
|
(13.1%, Due 7/2013) |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||