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Franklin BSP Lending Corp - Quarter Report: 2020 September (Form 10-Q)



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q
(Mark One)
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2020
OR
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 814-00821
BUSINESS DEVELOPMENT CORPORATION OF AMERICA
(Exact Name of Registrant as Specified in its Charter)

Maryland
 
27-2614444
(State or Other Jurisdiction of
Incorporation or Organization)
 
(I.R.S. Employer
Identification No.)
 
 
 
9 West 57th Street, 49th Floor, Suite 4920
New York, New York
 
10019
(Address of Principal Executive Office)
 
(Zip Code)

(212) 588-6770
(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act: None.

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

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 o No o

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

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



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. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x
The number of shares of the registrant's common stock, $0.001 par value, outstanding as of November 9, 2020 was 200,693,272.




BUSINESS DEVELOPMENT CORPORATION OF AMERICA
FORM 10-Q FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

TABLE OF CONTENTS
 
 
 
 
Page
PART I - FINANCIAL INFORMATION
  
PART II - OTHER INFORMATION
 



PART I - FINANCIAL INFORMATION
Item 1. CONSOLIDATED FINANCIAL STATEMENTS
BUSINESS DEVELOPMENT CORPORATION OF AMERICA
 
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
(dollars in thousands except share and per share data)
 
September 30,
 
December 31,
 
2020
 
2019
 
(Unaudited)
 
 
ASSETS
 
 
 
Investments, at fair value:
 
 
 
Control Investments, at fair value (amortized cost of $268,423 and $358,570, respectively)
$
301,140

 
$
406,517

Affiliate Investments, at fair value (amortized cost of $193,656 and $175,470, respectively)
123,312

 
129,526

Non-affiliate Investments, at fair value (amortized cost of $1,908,495 and $2,105,602, respectively)
1,786,299

 
2,010,141

Investments, at fair value (amortized cost of $2,370,574 and $2,639,642, respectively)
2,210,751

 
2,546,184

Cash and cash equivalents
71,011

 
46,470

Interest and dividends receivable
11,366

 
17,047

Receivable for unsettled trades
6,037

 
27,895

Prepaid expenses and other assets
1,915

 
2,934

Unrealized appreciation on forward currency exchange contracts
54

 
—

Total assets
$
2,301,134

 
$
2,640,530

 
 
 
 
LIABILITIES
 
 
 

Debt (net of deferred financing costs of $13,957 and $11,288, respectively)
$
878,996

 
$
1,083,754

Stockholder distributions payable
15,245

 
10,503

Management fees payable
8,933

 
10,098

Incentive fee on income payable
—

 
6,513

Accounts payable and accrued expenses
10,240

 
14,765

Payable for unsettled trades
33,909

 
40,347

Interest and debt fees payable
7,273

 
11,425

Directors' fees payable
55

 
54

Unrealized depreciation on forward currency exchange contracts
—

 
388

Total liabilities
954,651

 
1,177,847

Commitments and contingencies (Note 7)
 
 
 
 
 
 
 
NET ASSETS
 
 
 
Preferred stock, $.001 par value, 50,000,000 shares authorized, none issued and outstanding
—

 
—

Common stock, $.001 par value, 450,000,000 shares authorized;
228,592,208 issued and 200,693,985 outstanding at September 30, 2020,
and 215,850,546 issued and 190,207,517 outstanding at December 31, 2019
201

 
190

Additional paid in capital
1,906,482

 
1,847,312

Total distributable loss
(560,200
)
 
(384,819
)
Total net assets
1,346,483

 
1,462,683

 
 
 
 
Total liabilities and net assets
$
2,301,134

 
$
2,640,530

 
 
 
 
Net asset value per share
$
6.71

 
$
7.69



The accompanying notes are an integral part of these consolidated financial statements.
1

BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in thousands except share and per share data)
(Unaudited)

 
For the three months ended September 30,
 
For the nine months ended September 30,
 
2020
 
2019
 
2020
 
2019
Investment income:
 
 
 
 
 
 
 
From control investments
 
 
 
 
 
 
 
Interest income
$
4,283

 
$
4,464

 
$
15,504

 
$
14,369

Dividend income
3,273

 
5,136

 
9,845

 
12,456

Fee and other income
5

 
2

 
14

 
2

Total investment income from control investments
7,561

 
9,602

 
25,363

 
26,827

From affiliate investments
 
 
 
 
 
 
 
Interest income
286

 
3,307

 
1,082

 
10,210

Dividend income
358

 
1,672

 
1,439

 
2,936

Fee and other income
93

 
6

 
91

 
12

Total investment income from affiliate investments
737

 
4,985

 
2,612

 
13,158

From non-affiliate investments
 
 
 
 
 
 
 
Interest income
33,783

 
46,976

 
109,988

 
140,950

Dividend income
—

 
—

 
40

 
1,756

Fee and other income
2,062

 
1,052

 
4,253

 
2,631

Total investment income from non-affiliate investments
35,845

 
48,028

 
114,281

 
145,337

Interest from cash and cash equivalents
23

 
577

 
272

 
1,023

Total investment income
44,166

 
63,192

 
142,528

 
186,345

Operating expenses:
 

 
 

 
 

 
 

Management fees
8,933

 
10,269

 
28,255

 
29,739

Incentive fee on income
—

 
6,985

 
—

 
20,549

Interest and debt fees
10,909

 
14,131

 
36,986

 
41,505

Professional fees
1,365

 
1,207

 
3,966

 
4,342

Other general and administrative
785

 
1,897

 
3,391

 
5,424

Administrative services
395

 
199

 
955

 
592

Directors' fees
222

 
226

 
733

 
688

Total expenses
22,609

 
34,914

 
74,286

 
102,839

 
 
 
 
 
 
 
 
Income tax expense, including excise tax
1,237

 
338

 
1,931

 
1,301

Net investment gain attributable to non-controlling interests
—

 
—

 
—

 
9

Net investment income
20,320

 
27,940

 
66,311

 
82,196

 
 
 
 
 
 
 
 
Realized and unrealized gain (loss):
 
 
 
 
 
 
 
Net realized gain (loss)
 
 
 
 
 
 
 
   Control investments
(12,689
)
 
(41,306
)
 
(13,061
)
 
(41,400
)
   Affiliate investments
32

 
928

 
634

 
1,483

   Non-affiliate investments
(23,254
)
 
2,183

 
(93,560
)
 
1,660


The accompanying notes are an integral part of these consolidated financial statements.
2
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in thousands except share and per share data)
(Unaudited)

 
For the three months ended September 30,
 
For the nine months ended September 30,
 
2020
 
2019
 
2020
 
2019
   Net realized gain (loss) on foreign currency transactions
(845
)
 
(242
)
 
(72
)
 
432

Total net realized loss
(36,756
)
 
(38,437
)
 
(106,059
)
 
(37,825
)
Net change in unrealized appreciation (depreciation) on investments
 
 
 
 
 
 
 
   Control investments
21,652

 
33,530

 
(15,230
)
 
62,279

   Affiliate investments
1,278

 
(13,964
)
 
(24,400
)
 
(5,197
)
   Non-affiliate investments
51,891

 
(23,788
)
 
(26,735
)
 
(22,403
)
Net change in deferred taxes
(930
)
 
2,225

 
818

 
1,739

Total net change in unrealized appreciation (depreciation) on investments, net of change in deferred taxes
73,891

 
(1,997
)
 
(65,547
)
 
36,418

Net change in unrealized depreciation attributable to non-controlling interests
—

 
—

 
—

 
(3,017
)
Net change in unrealized appreciation (depreciation) from forward currency exchange contracts
519

 
444

 
442

 
(826
)
Net realized and unrealized gain (loss)
37,654

 
(39,990
)
 
(171,164
)
 
(5,250
)
Net increase (decrease) in net assets resulting from operations
$
57,974

 
$
(12,050
)
 
$
(104,853
)
 
$
76,946

 
 
 
 
 
 
 
 
Per share information - basic and diluted
 
 
 
 
 
 
 
Net investment income
$
0.10

 
$
0.15

 
$
0.34

 
$
0.43

Net increase (decrease) in net assets resulting from operations
$
0.29

 
$
(0.06
)
 
$
(0.53
)
 
$
0.41

Weighted average shares outstanding
199,984,106

 
190,060,251

 
196,404,920

 
189,973,074




The accompanying notes are an integral part of these consolidated financial statements.
3

BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS
(dollars in thousands except share and per share data)
(Unaudited)

 
For the nine months ended September 30,
 
2020
 
2019
Operations:
 
 
 
Net investment income
$
66,311

 
$
82,196

Net realized loss from investments
(105,987
)
 
(38,257
)
Net realized gain (loss) on foreign currency transactions
(72
)
 
432

Net change in unrealized appreciation (depreciation) on investments
(66,365
)
 
34,679

Net change in deferred taxes
818

 
1,739

Net change in unrealized depreciation attributable to non-controlling interests
—

 
(3,017
)
Net change in unrealized appreciation (depreciation) from forward currency exchange contracts
442

 
(826
)
Net increase (decrease) in net assets resulting from operations
(104,853
)
 
76,946

Stockholder distributions:
 
 
 

Distributions
(70,528
)
 
(92,357
)
Net decrease in net assets from stockholder distributions
(70,528
)
 
(92,357
)
Capital share transactions:
 
 
 

Acquisition of non-controlling interest
—

 
1,281

Issuance of common stock, net of issuance costs
59,000

 
—

Reinvestment of stockholder distributions
17,657

 
26,587

Repurchases of common stock
(17,476
)
 
(36,073
)
Net increase (decrease) in net assets from capital share transactions
59,181

 
(8,205
)
Total decrease in net assets, before non-controlling interest
(116,200
)
 
(23,616
)
Decrease in non-controlling interest
—

 
(3,686
)
Total decrease in net assets
(116,200
)
 
(27,302
)
Net assets at beginning of period
1,462,683

 
1,492,719

Net assets at end of period
$
1,346,483

 
$
1,465,417

 
 
 
 
Net asset value per common share attributable to Business Development Corporation of America
$
6.71

 
$
7.75

Common shares outstanding at end of period
200,693,985

 
189,180,961



The accompanying notes are an integral part of these consolidated financial statements.
4
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)

 
For the nine months ended September 30,
 
2020
 
2019
Operating activities:
 
 
 
Net increase (decrease) in net assets resulting from operations
$
(104,853
)
 
$
76,946

Adjustments to reconcile net increase (decrease) in net assets from operations to net cash provided by (used in) operating activities:
 
 
 
Payment-in-kind interest income
(6,063
)
 
(3,695
)
Net accretion of discount on investments
(5,239
)
 
(6,979
)
Amortization of deferred financing costs
3,060

 
2,666

Amortization of discount on unsecured notes
547

 
408

Sales and repayments of investments
669,886

 
560,575

Purchases of investments
(495,503
)
 
(795,510
)
Net realized loss from investments
105,987

 
38,257

Net realized (gain) loss on foreign currency transactions
72

 
(432
)
Net change in unrealized (appreciation) depreciation on investments
66,365

 
(34,679
)
Net change in unrealized (appreciation) depreciation from forward currency exchange contracts
(442
)
 
826

(Increase) decrease in operating assets:
 
 
 
Interest and dividends receivable
5,681

 
(83
)
Receivable for unsettled trades
21,858

 
5,062

Prepaid expenses and other assets
1,019

 
179

Increase (decrease) in operating liabilities:
 
 
 
Management fees payable
(1,165
)
 
558

Incentive fee on income payable
(6,513
)
 
1,295

Accounts payable and accrued expenses
(4,848
)
 
4,706

Payable for unsettled trades
(6,438
)
 
20,671

Interest and debt fees payable
(4,152
)
 
821

Directors' fees payable
1

 
(35
)
Net cash provided by (used in) operating activities
239,260

 
(128,443
)
 
 
 
 
Financing activities:
 
 
 

Acquisition of non-controlling interest
—

 
1,281

Proceeds from issuance of shares of common stock, net
59,000

 
—

Repurchases of common stock
(17,476
)
 
(36,078
)
Proceeds from debt
774,000

 
282,000

Payments on debt
(976,652
)
 
(45,000
)
Payments of financing costs
(5,406
)
 
(2,531
)
Stockholder distributions
(48,129
)
 
(66,170
)
Decrease in non-controlling interest
—

 
(3,686
)
Net cash provided by (used in) financing activities
(214,663
)
 
129,816

 
 
 
 
Net increase in cash and cash equivalents
24,597

 
1,373

Effect of foreign currency exchange rates
(56
)
 
432

Cash and cash equivalents, beginning of period
46,470

 
96,692

Cash and cash equivalents, end of period
$
71,011

 
$
98,497

Supplemental information:
 
 
 

Interest paid during the period
$
37,355

 
$
37,431

Taxes, including excise tax, paid during the period
$
2,600

 
$
53

Distributions reinvested
$
17,657

 
$
26,587


The accompanying notes are an integral part of these consolidated financial statements.
5
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior Secured First Lien Debt - 115.8% (b)
 
 
 
 
 
 
 
 
 
 
1236904 BC, Ltd. (c) (h) (i)
 
Software/Services
 
L+5.50% (5.65%), 2/26/2027
 
$
18,876

 
$
18,171

 
$
17,243

 
1.3
%
Abaco Systems Holding Corp. (c) (h) (i)
 
Industrials
 
L+6.00% (7.00%), 12/7/2021
 
23,033

 
22,922

 
23,033

 
1.7
%
ABC Financial Intermediate, LLC (c) (j)
 
Technology
 
L+4.25% (5.25%), 1/2/2025
 
14,491

 
14,446

 
12,969

 
1.0
%
Abercrombie & Fitch, Co. (a)
 
Consumer
 
8.75%, 7/15/2025
 
3,182

 
3,182

 
3,347

 
0.2
%
Accentcare, Inc. (c) (j)
 
Healthcare
 
L+5.00% (5.15%), 6/22/2026
 
13,371

 
13,261

 
13,184

 
1.0
%
Acrisure, LLC (i) (j)
 
Financials
 
L+3.50% (3.65%), 2/16/2027
 
24,711

 
24,693

 
23,815

 
1.8
%
AHP Health Partners, Inc. (i) (j)
 
Healthcare
 
L+4.50% (5.50%), 6/30/2025
 
13,558

 
13,499

 
13,528

 
1.0
%
Alchemy US Holdco 1, LLC (h) (i) (j)
 
Industrials
 
L+5.50% (5.65%), 10/10/2025
 
6,456

 
6,197

 
5,961

 
0.4
%
Aldevron, LLC (h) (i) (j)
 
Healthcare
 
L+4.25% (5.25%), 10/13/2026
 
10,716

 
10,632

 
10,711

 
0.8
%
Alvogen Pharma US, Inc. (c) (j)
 
Healthcare
 
L+5.25% (6.25%), 12/29/2023
 
12,818

 
12,778

 
12,305

 
0.9
%
AM General, LLC (c) (i)
 
Industrials
 
L+7.25% (8.25%), 12/28/2021
 
1,486

 
1,486

 
1,531

 
0.1
%
AMI Entertainment Network, LLC (c) (i)
 
Media/Entertainment
 
L+6.00% (7.00%), 7/21/2022
 
12,161

 
12,074

 
11,227

 
0.8
%
AMI Entertainment Network, LLC (c) (i)
 
Media/Entertainment
 
L+6.00% (7.00%), 7/21/2022
 
3,667

 
3,630

 
3,385

 
0.3
%
AP Gaming I, LLC (j)
 
Gaming/Lodging
 
L+3.50% (4.50%), 2/15/2024
 
7,563

 
7,559

 
6,656

 
0.5
%
Aq Carver Buyer, Inc. (c) (h) (i)
 
Business Services
 
L+5.00% (6.00%), 9/23/2025
 
9,321

 
8,686

 
9,088

 
0.7
%
AqGen Ascensus, Inc. (j)
 
Business Services
 
L+4.00% (5.00%), 12/3/2026
 
18,251

 
18,191

 
18,103

 
1.3
%
Arch Global Precision, LLC (c) (h) (i)
 
Industrials
 
L+4.75% (4.97%), 4/1/2026
 
10,797

 
10,727

 
10,797

 
0.8
%
Asp Navigate Acquisition Corp. (j)
 
Healthcare
 
L+4.50% (5.50%), 10/6/2027
 
3,309

 
3,259

 
3,268

 
0.2
%
Athenahealth, Inc. (j)
 
Healthcare
 
L+4.50% (4.75%), 2/11/2026
 
12,696

 
12,557

 
12,474

 
0.9
%
Avaya Holdings Corp. (a) (j)
 
Technology
 
L+4.25% (4.40%), 12/16/2024
 
20,145

 
20,028

 
20,013

 
1.5
%
Aveanna Healthcare, LLC (h)
 
Healthcare
 
L+4.25% (5.25%), 3/18/2024
 
778

 
747

 
731

 
0.1
%
Aveanna Healthcare, LLC (h)
 
Healthcare
 
L+5.50% (6.50%), 3/18/2024
 
5,976

 
5,802

 
5,647

 
0.4
%
Aveanna Healthcare, LLC (j)
 
Healthcare
 
L+6.25% (7.25%), 3/18/2024
 
3,638

 
3,566

 
3,538

 
0.3
%
Axiom Global, Inc. (c) (i)
 
Business Services
 
L+4.75% (5.05%), 10/1/2026
 
11,407

 
11,314

 
11,304

 
0.8
%
BBB Industries, LLC (h)
 
Transportation
 
L+4.50% (5.58%), 8/1/2025
 
13,021

 
12,943

 
11,954

 
0.9
%
BCP Raptor, LLC (j)
 
Energy
 
L+4.25% (5.25%), 6/24/2024
 
13,783

 
13,703

 
10,740

 
0.8
%
BCP Renaissance, LLC (j)
 
Energy
 
L+3.50% (4.50%), 10/31/2024
 
3,393

 
3,383

 
3,138

 
0.2
%
Black Mountain Sand, LLC (c) (l)
 
Energy
 
L+11.00% (12.50%), 6/28/2024
 
23,000

 
22,851

 
20,700

 
1.5
%

The accompanying notes are an integral part of these consolidated financial statements.
6
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
BMC Software Finance, Inc. (j)
 
Technology
 
L+4.25% (4.40%), 10/2/2025
 
$
14,498

 
$
14,394

 
$
14,040

 
1.0
%
Bomgar Corp. (c) (j)
 
Technology
 
L+4.00% (4.15%), 4/18/2025
 
1,947

 
1,941

 
1,947

 
0.1
%
Boston Market Corp. (c) (l) (t)
 
Food & Beverage
 
5.00%, 4/1/2022
 
2,428

 
—

 
—

 
—
%
CareCentrix, Inc. (c) (i) (j)
 
Healthcare
 
L+4.50% (4.72%), 4/3/2025
 
19,701

 
19,610

 
18,736

 
1.4
%
CCW, LLC (c) (h) (i) (l) (t)
 
Food & Beverage
 
L+8.00% (9.00%), 3/22/2021
 
28,175

 
26,608

 
16,032

 
1.2
%
CCW, LLC (c) (l) (t)
 
Food & Beverage
 
L+8.00% (9.00%), 3/22/2021
 
1,376

 
1,300

 
783

 
0.1
%
CDHA Holdings, LLC (c) (h) (i) (l)
 
Healthcare
 
L+7.25% (8.25%), 8/24/2023
 
15,531

 
15,397

 
14,863

 
1.1
%
CDHA Holdings, LLC (c) (k) (l)
 
Healthcare
 
L+6.75% (7.75%), 8/24/2023
 
551

 
545

 
527

 
—
%
CDHA Holdings, LLC (c) (k) (l)
 
Healthcare
 
L+7.25% (8.25%), 8/24/2023
 
1,268

 
1,268

 
1,212

 
0.1
%
CDS Canada 4, LP (a) (c)
 
Media/Entertainment
 
L+4.00% (5.00%), 6/3/2021
 
348

 
368

 
348

 
—
%
CDS U.S. Intermediate Holdings, Inc. (a) (c) (h) (j) (t)
 
Media/Entertainment
 
L+5.50% (6.50%), 7/8/2022
 
3,980

 
3,912

 
2,189

 
0.2
%
Chloe Ox Parent, LLC (c) (i) (j)
 
Healthcare
 
L+4.50% (5.50%), 12/23/2024
 
13,321

 
13,176

 
12,961

 
1.0
%
Clarion Events, Ltd. (a) (j)
 
Business Services
 
L+5.25% (6.25%), 9/30/2024
 
10,341

 
10,207

 
7,761

 
0.6
%
Clover Technologies Group, LLC (c) (j)
 
Industrials
 
L+7.50% (8.50%), 2/3/2024
 
1,475

 
1,475

 
1,282

 
0.1
%
CLP Health Services, Inc. (c) (i)
 
Healthcare
 
L+5.00% (6.07%), 12/31/2026
 
10,034

 
9,862

 
9,894

 
0.7
%
Cold Spring Brewing, Co. (c) (h) (i)
 
Food & Beverage
 
L+4.75% (5.75%), 12/19/2025
 
8,774

 
8,696

 
8,697

 
0.6
%
Community Care Health Network, LLC (c) (h) (j)
 
Healthcare
 
L+4.75% (4.90%), 2/17/2025
 
9,360

 
9,109

 
9,143

 
0.7
%
Connect Finco SARL (a) (j)
 
Telecom
 
L+4.50% (5.50%), 12/11/2026
 
4,619

 
4,493

 
4,472

 
0.3
%
Conservice Midco, LLC (j)
 
Business Services
 
L+4.25% (4.47%), 5/13/2027
 
3,109

 
2,977

 
3,070

 
0.2
%
CONSOL Energy, Inc. (c) (j)
 
Industrials
 
L+4.50% (4.65%), 9/27/2024
 
4,089

 
4,074

 
3,312

 
0.2
%
Conterra Ultra Broadband, LLC (c) (j)
 
Telecom
 
L+4.50% (4.65%), 4/30/2026
 
5,999

 
5,976

 
5,999

 
0.4
%
Corfin Industries, LLC (c) (h) (i)
 
Industrials
 
L+6.00% (7.00%), 2/5/2026
 
12,236

 
12,017

 
12,017

 
0.9
%
Crown Subsea Communications Holding, Inc. (c) (j)
 
Industrials
 
L+6.00% (6.16%), 11/3/2025
 
1,908

 
1,895

 
1,908

 
0.1
%
CRS-SPV, Inc. (c) (k) (o)
 
Industrials
 
L+4.50% (5.50%), 3/8/2021
 
62

 
62

 
62

 
—
%
Dunn Paper, Inc. (c) (j)
 
Paper & Packaging
 
L+4.75% (5.75%), 8/26/2022
 
581

 
543

 
535

 
—
%
Dynasty Acqusition Co., Inc. (i) (j)
 
Industrials
 
L+3.50% (3.72%), 4/6/2026
 
3,361

 
3,179

 
2,956

 
0.2
%
Dynasty Acqusition Co., Inc. (i) (j)
 
Industrials
 
L+3.50% (3.72%), 4/6/2026
 
6,252

 
5,913

 
5,497

 
0.4
%
Florida Food Products, LLC (c) (h)
 
Food & Beverage
 
L+6.50% (7.50%), 9/6/2025
 
21,946

 
21,560

 
20,651

 
1.5
%
Florida Food Products, LLC (c) (i)
 
Food & Beverage
 
L+7.25% (8.25%), 9/8/2025
 
1,328

 
1,239

 
1,235

 
0.1
%

The accompanying notes are an integral part of these consolidated financial statements.
7
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Florida Food Products, LLC (c) (k)
 
Food & Beverage
 
L+6.50% (7.50%), 9/6/2023
 
$
1,647

 
$
1,647

 
$
1,561

 
0.1
%
Foresight Energy Operating, LLC (c) (p)
 
Industrials
 
L+8.00% (9.50%), 6/30/2027
 
1,330

 
1,329

 
1,348

 
0.1
%
Frontier Communications Corp. (h)
 
Telecom
 
P+2.75% (6.00%), 6/17/2024
 
13,777

 
13,564

 
13,522

 
1.0
%
Gold Standard Baking, Inc. (c) (l)
 
Food & Beverage
 
L+8.50% (9.50%), 7/25/2022
 
3,124

 
2,576

 
1,250

 
0.1
%
Green Energy Partners/Stonewall, LLC (j)
 
Utilities
 
L+5.50% (6.50%), 11/15/2021
 
1,314

 
1,313

 
1,182

 
0.1
%
Green Energy Partners/Stonewall, LLC (j)
 
Utilities
 
L+5.50% (6.50%), 11/15/2021
 
992

 
991

 
893

 
0.1
%
HC2 Holdings, Inc. (k)
 
Industrials
 
11.50%, 12/1/2021
 
7,864

 
7,823

 
7,490

 
0.6
%
Health Plan One, Inc. (c) (k)
 
Financials
 
L+7.50% (8.50%), 7/15/2025
 
10,695

 
10,183

 
10,485

 
0.8
%
HireRight, Inc. (i)
 
Business Services
 
L+3.75% (3.90%), 7/11/2025
 
2,893

 
2,874

 
2,630

 
0.2
%
ICR Operations, LLC (c) (h) (i)
 
Business Services
 
L+5.00% (6.00%), 3/26/2025
 
17,189

 
16,962

 
17,189

 
1.3
%
ICR Operations, LLC (c) (k)
 
Business Services
 
L+5.00% (6.00%), 3/26/2024
 
1,377

 
1,376

 
1,377

 
0.1
%
Ideal Tridon Holdings, Inc. (c)
 
Industrials
 
L+5.75% (6.75%), 7/31/2024
 
46

 
46

 
46

 
0.0
%
Ideal Tridon Holdings, Inc. (c) (h) (i)
 
Industrials
 
L+5.75% (6.75%), 7/31/2024
 
28,330

 
28,069

 
28,330

 
2.1
%
Ideal Tridon Holdings, Inc. (c) (h) (i)
 
Industrials
 
L+5.75% (6.75%), 7/31/2024
 
830

 
818

 
830

 
0.1
%
Ideal Tridon Holdings, Inc. (c) (k)
 
Industrials
 
L+5.75% (6.75%), 7/31/2023
 
1,124

 
1,124

 
1,124

 
0.1
%
IDERA, Inc. (j)
 
Technology
 
L+4.00% (5.00%), 6/28/2024
 
4,282

 
4,270

 
4,214

 
0.3
%
Integral Ad Science, Inc. (c) (k) (l)
 
Software/Services
 
L+7.25% (8.25%), 7/19/2024
 
15,448

 
15,255

 
15,448

 
1.1
%
Integrated Efficiency Solutions, Inc. (c) (l)
 
Industrials
 
L+9.00% (11.00%), 6/30/2022
 
3,792

 
3,792

 
3,119

 
0.2
%
Integrated Global Services, Inc. (c) (i)
 
Industrials
 
L+6.00% (7.00%), 2/4/2026
 
12,106

 
11,891

 
11,961

 
0.9
%
Integrated Global Services, Inc. (c) (k)
 
Industrials
 
L+6.00% (7.00%), 2/4/2026
 
1,622

 
1,622

 
1,603

 
0.1
%
Intelsat Jackson Holdings, SA (a)
 
Telecom
 
8.63%, 1/2/2024
 
2,367

 
2,376

 
2,388

 
0.2
%
Intelsat Jackson Holdings, SA (a)
 
Telecom
 
P+4.75% (8.00%), 11/27/2023
 
1,124

 
1,121

 
1,128

 
0.1
%
Internap Corp. (c) (h) (l) (p)
 
Business Services
 
L+6.50% (7.50%), 5/8/2025
 
5,873

 
5,873

 
4,980

 
0.4
%
Internap Corp. (c) (p)
 
Business Services
 
L+10.00% (11.00%), 5/8/2023
 
1,995

 
1,881

 
1,995

 
0.1
%
International Cruise & Excursions, Inc. (c) (i)
 
Business Services
 
L+5.25% (6.25%), 6/6/2025
 
4,964

 
4,927

 
4,169

 
0.3
%
IPC Corp. (c) (j)
 
Software/Services
 
L+4.50% (5.50%), 8/6/2021
 
3,784

 
3,769

 
3,269

 
0.2
%
Iri Holdings, Inc. (c) (j)
 
Business Services
 
L+4.25% (4.40%), 12/1/2025
 
4,913

 
4,876

 
4,790

 
0.4
%
Jakks Pacific, Inc. (c) (l) (p)
 
Consumer
 
10.50%, 2/9/2023
 
2,360

 
2,136

 
2,312

 
0.2
%
K2 Intelligence Holdings, Inc. (c) (h) (i)
 
Business Services
 
L+4.75% (5.75%), 9/23/2024
 
10,251

 
10,088

 
10,082

 
0.7
%
Kahala Ireland OpCo Designated Activity Company (a) (c) (k) (l) (o)
 
Transportation
 
L+8.00% (13.00%), 12/22/2028
 
26,549

 
26,549

 
26,549

 
2.0
%

The accompanying notes are an integral part of these consolidated financial statements.
8
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Kaman Distribution Corp. (c) (h) (i)
 
Industrials
 
L+5.00% (5.22%), 8/26/2026
 
$
21,336

 
$
19,709

 
$
19,843

 
1.5
%
KidKraft, Inc. (c) (l) (t)
 
Consumer
 
L+6.00% (7.00%), 8/15/2022
 
1,025

 
50

 
51

 
0.0
%
KMTEX, LLC (c) (g) (l) (o)
 
Chemicals
 
P+3.00% (6.25%), 6/16/2025
 
816

 
816

 
816

 
0.1
%
KMTEX, LLC (c) (g) (l) (o)
 
Chemicals
 
P+3.00% (6.25%), 6/16/2025
 
134

 
134

 
134

 
0.0
%
KMTEX, LLC (c) (l) (o)
 
Chemicals
 
P+3.00% (6.25%), 6/16/2025
 
3,179

 
3,179

 
3,179

 
0.2
%
Labrie Environmental Group, LLC (a) (c) (h)
 
Industrials
 
L+5.50% (6.50%), 9/1/2026
 
22,866

 
22,415

 
22,409

 
1.7
%
Lakeland Tours, LLC (c) (h) (l)
 
Education
 
13.25%, 9/27/2027
 
4,101

 
2,055

 
2,051

 
0.2
%
Lakeland Tours, LLC (c) (h) (l)
 
Education
 
L+12.00% (13.25%), 9/25/2023
 
1,777

 
1,777

 
1,777

 
0.1
%
Lakeland Tours, LLC (c) (h) (l)
 
Education
 
L+7.50% (8.75%), 9/25/2025
 
3,242

 
3,242

 
3,242

 
0.2
%
Lakeland Tours, LLC (c) (h) (l)
 
Education
 
L+7.50% (8.75%), 9/25/2025
 
4,069

 
3,583

 
3,581

 
0.3
%
Lakeview Health Holdings, Inc. (c) (l) (t)
 
Healthcare
 
9.75%, 12/15/2021
 
139

 
124

 
49

 
—
%
Lakeview Health Holdings, Inc. (c) (l) (t)
 
Healthcare
 
9.75%, 12/15/2021
 
4,037

 
2,671

 
1,413

 
0.1
%
LightSquared, LP (l)
 
Telecom
 
L+11.75% (12.75%), 12/7/2020
 
4,931

 
4,931

 
4,509

 
0.3
%
Lionbridge Technologies, Inc. (c) (h) (i)
 
Business Services
 
L+6.25% (7.25%), 12/29/2025
 
10,266

 
10,177

 
10,266

 
0.8
%
MCS Acquisition Corp. (c)
 
Business Services
 
L+4.75% (5.75%), 5/20/2024
 
13,973

 
13,941

 
4,891

 
0.4
%
MED Parentco, LP (c) (j)
 
Healthcare
 
L+4.25% (4.40%), 8/31/2026
 
1,000

 
1,000

 
953

 
0.1
%
MED Parentco, LP (c) (j)
 
Healthcare
 
L+4.25% (4.40%), 8/31/2026
 
5,702

 
5,654

 
5,431

 
0.4
%
Medallion Midland Acquisition, LP (j)
 
Energy
 
L+3.25% (4.25%), 10/30/2024
 
3,661

 
3,655

 
3,439

 
0.3
%
Medical Depot Holdings, Inc. (c) (h) (i) (l)
 
Healthcare
 
L+9.50% (10.50%), 1/3/2023
 
19,138

 
18,483

 
13,598

 
1.0
%
MGTF Radio Company, LLC (c) (k) (o)
 
Media/Entertainment
 
L+6.00% (7.00%), 4/1/2024
 
55,521

 
55,408

 
43,695

 
3.2
%
Midwest Can Company, LLC (c) (h) (i)
 
Paper & Packaging
 
L+5.75% (6.75%), 3/2/2026
 
17,418

 
17,103

 
17,103

 
1.3
%
Miller Environmental Group, Inc. (c) (h) (i)
 
Business Services
 
L+6.50% (7.50%), 3/15/2024
 
10,510

 
10,337

 
10,510

 
0.8
%
Miller Environmental Group, Inc. (c) (h) (i)
 
Business Services
 
L+6.50% (7.50%), 3/15/2024
 
11,492

 
11,333

 
11,492

 
0.9
%
Miller Environmental Group, Inc. (c) (k)
 
Business Services
 
L+6.50% (7.50%), 3/15/2024
 
397

 
397

 
397

 
0.0
%
Mintz Group, LLC (c) (i)
 
Business Services
 
L+4.75% (5.75%), 3/18/2026
 
4,723

 
4,680

 
4,680

 
0.3
%
Monitronics International, Inc. (k)
 
Business Services
 
L+6.50% (7.75%), 3/29/2024
 
5,579

 
5,587

 
4,184

 
0.3
%
Montreign Operating Company, LLC (c)
 
Gaming/Lodging
 
L+2.75% (2.89%), 3/22/2021
 
7,896

 
7,863

 
7,896

 
0.6
%
Mood Media Corp. (c) (h) (l) (p) (t)
 
Media/Entertainment
 
L+9.25% (10.25%), 7/31/2025
 
8,299

 
8,057

 
8,299

 
0.6
%
Mood Media Corp. (c) (l) (p)
 
Media/Entertainment
 
L+9.25% (10.25%), 7/31/2025
 
1,689

 
1,617

 
1,689

 
0.1
%

The accompanying notes are an integral part of these consolidated financial statements.
9
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Muth Mirror Systems, LLC (c) (h) (i)
 
Technology
 
L+5.25% (6.25%), 4/23/2025
 
$
15,539

 
$
15,303

 
$
13,907

 
1.0
%
Muth Mirror Systems, LLC (c) (k)
 
Technology
 
L+5.25% (6.25%), 4/23/2025
 
325

 
325

 
289

 
0.0
%
National Technical Systems, Inc. (c) (h) (i)
 
Business Services
 
L+6.00% (7.00%), 6/14/2021
 
17,238

 
17,216

 
16,549

 
1.2
%
Navitas Midstream Midland Basin, LLC (j)
 
Energy
 
L+4.50% (5.50%), 12/13/2024
 
21,618

 
18,840

 
20,311

 
1.5
%
New Amsterdam Software Bidco, LLC (c) (h) (i)
 
Technology
 
L+5.00% (6.00%), 5/1/2026
 
6,088

 
5,991

 
6,088

 
0.5
%
New Star Metals, Inc. (c) (h) (i)
 
Industrials
 
L+6.00% (7.50%), 7/10/2023
 
21,923

 
21,549

 
21,200

 
1.6
%
NN, Inc. (h)
 
Industrials
 
L+5.75% (5.90%), 10/19/2022
 
11,062

 
10,651

 
10,908

 
0.8
%
NN, Inc. (h)
 
Industrials
 
L+5.75% (6.50%), 10/19/2022
 
10,041

 
9,527

 
9,901

 
0.7
%
Norvax, LLC (c) (k)
 
Business Services
 
L+6.50% (7.50%), 9/12/2025
 
11,403

 
11,155

 
11,086

 
0.8
%
NTM Acquisition Corp. (c) (h) (i)
 
Media/Entertainment
 
L+6.25% (7.25%), 6/7/2024
 
22,259

 
22,166

 
20,033

 
1.5
%
Olaplex, Inc. (c) (h) (i)
 
Consumer
 
L+6.50% (7.50%), 1/8/2026
 
17,341

 
17,036

 
17,341

 
1.3
%
Olaplex, Inc. (c) (k)
 
Consumer
 
L+6.50% (7.50%), 1/8/2025
 
954

 
954

 
954

 
0.1
%
ORG GC Holdings, LLC (c) (h) (t)
 
Business Services
 
L+6.75% (7.75%), 7/31/2022
 
21,624

 
21,457

 
16,218

 
1.2
%
Perstorp Holding Ab (a) (c) (j)
 
Chemicals
 
L+4.75% (5.02%), 2/27/2026
 
8,890

 
8,792

 
8,090

 
0.6
%
PGX Holdings, Inc. (c) (j) (l) (t)
 
Consumer
 
L+9.50% (10.50%), 9/29/2023
 
10,535

 
9,780

 
8,038

 
0.6
%
Planet Equity Group, LLC (c) (h)
 
Business Services
 
L+5.25% (6.25%), 11/18/2025
 
14,829

 
14,639

 
14,829

 
1.1
%
Planet Equity Group, LLC (c) (k)
 
Business Services
 
L+5.25% (6.25%), 11/18/2024
 
1,163

 
1,163

 
1,163

 
0.1
%
PlayPower, Inc. (c) (h) (i)
 
Industrials
 
L+5.50% (5.65%), 5/8/2026
 
25,416

 
25,110

 
24,146

 
1.8
%
Premier Dental Services, Inc. (c) (h) (i)
 
Healthcare
 
L+5.25% (6.25%), 6/30/2023
 
32,105

 
31,982

 
29,826

 
2.2
%
Premier Global Services, Inc. (c) (j)
 
Telecom
 
L+6.50% (7.50%), 6/8/2023
 
6,072

 
5,932

 
3,916

 
0.3
%
PSKW, LLC (c) (h) (i)
 
Healthcare
 
L+6.25% (7.25%), 3/9/2026
 
29,850

 
29,174

 
29,253

 
2.2
%
PT Network, LLC (c) (h) (l)
 
Healthcare
 
L+7.50% (8.73%), 11/30/2023
 
16,953

 
16,889

 
14,902

 
1.1
%
Questex, Inc. (c) (h) (i)
 
Media/Entertainment
 
L+5.75% (6.75%), 9/9/2024
 
15,867

 
15,659

 
14,487

 
1.1
%
Questex, Inc. (c) (k)
 
Media/Entertainment
 
L+5.75% (6.75%), 9/9/2024
 
1,292

 
1,292

 
1,180

 
0.1
%
RE Investment Company, LLC (c) (h)
 
Industrials
 
L+8.00% (9.00%), 9/25/2025
 
13,667

 
13,327

 
13,325

 
1.0
%
Red River Technology, LLC (c) (h) (i)
 
Business Services
 
L+5.00% (6.00%), 8/30/2024
 
23,491

 
23,210

 
23,491

 
1.8
%
Reddy Ice Corp. (c) (h) (i)
 
Food & Beverage
 
L+6.00% (7.20%), 7/1/2025
 
19,393

 
18,932

 
18,859

 
1.4
%
Reddy Ice Corp. (c) (k)
 
Food & Beverage
 
L+6.00% (7.20%), 7/1/2025
 
1,275

 
1,257

 
1,236

 
0.1
%
Regionalcare Hospital Partners Holdings, Inc. (j)
 
Healthcare
 
L+3.75% (3.90%), 11/14/2025
 
21,025

 
20,779

 
20,408

 
1.5
%

The accompanying notes are an integral part of these consolidated financial statements.
10
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
REP TEC Intermediate Holdings, Inc. (c) (h) (i)
 
Software/Services
 
L+6.50% (7.50%), 6/19/2025
 
$
6,997

 
$
6,799

 
$
6,840

 
0.5
%
Resco Products, Inc. (c) (l)
 
Industrials
 
L+7.00% (9.00%), 6/5/2022
 
9,850

 
9,850

 
9,062

 
0.7
%
Safety Products/JHC Acquisition Corp. (c) (j)
 
Industrials
 
L+4.50% (4.65%), 6/28/2026
 
17,583

 
17,449

 
16,106

 
1.2
%
Safety Products/JHC Acquisition Corp. (c) (j)
 
Industrials
 
L+4.50% (4.65%), 6/28/2026
 
950

 
950

 
871

 
0.1
%
Schenectady International Group, Inc. (j)
 
Chemicals
 
L+4.75% (4.91%), 10/15/2025
 
21,563

 
21,197

 
20,701

 
1.5
%
SCIH Salt Holdings, Inc. (c)
 
Industrials
 
L+4.00% (5.00%), 3/17/2025
 
509

 
509

 
470

 
—
%
SCIH Salt Holdings, Inc. (h) (i)
 
Industrials
 
L+4.50% (5.50%), 3/16/2027
 
24,913

 
24,680

 
24,850

 
1.9
%
SFR Group, SA (a) (i) (j)
 
Telecom
 
L+4.00% (4.15%), 8/14/2026
 
12,869

 
12,777

 
12,476

 
0.9
%
Shields Health Solutions Holdings, LLC (c) (h) (i)
 
Healthcare
 
L+5.00% (5.15%), 8/19/2026
 
6,910

 
6,852

 
6,910

 
0.5
%
SitusAMC Holdings Corp. (c) (h)
 
Financials
 
L+4.75% (5.75%), 6/28/2025
 
1,477

 
1,455

 
1,455

 
0.1
%
SitusAMC Holdings Corp. (c) (h) (i)
 
Financials
 
L+4.75% (5.75%), 6/30/2025
 
8,422

 
8,321

 
8,312

 
0.6
%
SitusAMC Holdings Corp. (c) (k)
 
Financials
 
L+4.75% (5.75%), 6/30/2025
 
752

 
742

 
742

 
0.1
%
Skillsoft Corp. (c)
 
Technology
 
L+7.50% (8.50%), 12/27/2024
 
725

 
682

 
681

 
0.1
%
Skillsoft Corp. (c)
 
Technology
 
L+7.50% (8.50%), 12/27/2024
 
638

 
604

 
603

 
—
%
Skillsoft Corp. (c) (j) (t)
 
Technology
 
L+7.50% (8.50%), 4/28/2025
 
4,249

 
4,249

 
4,249

 
0.3
%
Sotera Health Holdings, LLC (j)
 
Healthcare
 
L+4.50% (5.50%), 12/11/2026
 
3,813

 
3,717

 
3,794

 
0.3
%
Spirit Aerosystems, Inc. (a)
 
Industrials
 
5.50%, 1/15/2025
 
497

 
497

 
502

 
—
%
Spirit Aerosystems, Inc. (a) (j)
 
Industrials
 
L+5.25% (6.00%), 1/31/2025
 
1,655

 
1,647

 
1,647

 
0.1
%
SSH Group Holdings, Inc. (j)
 
Education
 
L+4.25% (4.47%), 7/30/2025
 
10,654

 
10,627

 
10,086

 
0.8
%
Subsea Global Solutions, LLC (c) (i)
 
Business Services
 
L+7.00% (8.00%), 3/29/2023
 
4,744

 
4,675

 
4,649

 
0.3
%
Subsea Global Solutions, LLC (c) (i)
 
Business Services
 
L+7.00% (8.00%), 3/29/2023
 
8,263

 
8,181

 
8,106

 
0.7
%
Subsea Global Solutions, LLC (c) (k)
 
Business Services
 
L+7.00% (8.00%), 3/29/2023
 
193

 
193

 
189

 
—
%
Tax Defense Network, LLC (c) (l) (p) (t)
 
Consumer
 
10.00%, 9/30/2021
 
3,230

 
2,986

 
3,230

 
0.2
%
Tax Defense Network, LLC (c) (l) (p) (t)
 
Consumer
 
L+6.00% (10.00%), 9/30/2021
 
32,986

 
21,646

 
2,309

 
0.2
%
Tax Defense Network, LLC (c) (l) (p) (t)
 
Consumer
 
L+6.00% (10.00%), 9/30/2021
 
5,855

 
3,833

 
410

 
—
%
The Dun & Bradstreet Corp. (j)
 
Business Services
 
L+3.75% (3.89%), 2/6/2026
 
9,950

 
9,797

 
9,836

 
0.7
%
Tillamook Country Smoker, LLC (c) (h)
 
Food & Beverage
 
L+5.75% (6.75%), 5/19/2022
 
9,937

 
9,888

 
9,646

 
0.7
%
Tillamook Country Smoker, LLC (c) (k)
 
Food & Beverage
 
L+5.75% (6.75%), 5/19/2022
 
2,561

 
2,561

 
2,486

 
0.2
%
Tivity Health, Inc. (a) (j)
 
Healthcare
 
L+4.25% (4.40%), 3/8/2024
 
859

 
853

 
809

 
0.1
%

The accompanying notes are an integral part of these consolidated financial statements.
11
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Tivity Health, Inc. (a) (j)
 
Healthcare
 
L+5.25% (5.40%), 3/6/2026
 
$
3,602

 
$
3,532

 
$
3,389

 
0.3
%
Trademark Global, LLC (c) (k) (l)
 
Consumer
 
L+10.00% (11.00%), 10/31/2022
 
1,933

 
1,933

 
1,836

 
0.1
%
Traverse Midstream Partners, LLC (j)
 
Energy
 
L+4.00% (5.00%), 9/27/2024
 
16,099

 
15,786

 
14,751

 
1.1
%
Trilogy International Partners, LLC (a)
 
Telecom
 
8.88%, 5/1/2022
 
14,875

 
14,848

 
13,611

 
1.0
%
University of St. Augustine Acquisition Corp. (c) (h) (i)
 
Education
 
L+4.25% (5.25%), 2/2/2026
 
23,822

 
23,368

 
23,965

 
1.8
%
Veritext Corp. (c) (h) (i)
 
Business Services
 
L+3.25% (3.40%), 8/1/2025
 
4,937

 
4,937

 
4,641

 
0.4
%
Verscend Holding Corp. (j)
 
Healthcare
 
L+4.50% (4.65%), 8/27/2025
 
1,737

 
1,704

 
1,718

 
0.1
%
Vertex Aerospace Services Corp. (h) (i)
 
Industrials
 
L+4.50% (4.65%), 6/30/2025
 
8,660

 
8,630

 
8,519

 
0.6
%
Vyaire Medical, Inc. (c) (j)
 
Healthcare
 
L+4.75% (5.75%), 4/16/2025
 
7,932

 
7,725

 
6,108

 
0.5
%
WaterBridge Midstream Operating, LLC (j)
 
Energy
 
L+5.75% (6.75%), 6/22/2026
 
13,804

 
13,563

 
11,447

 
0.9
%
WMK, LLC (c)
 
Business Services
 
L+5.75% (6.75%), 9/5/2025
 
357

 
354

 
348

 
—
%
WMK, LLC (c) (h) (i)
 
Business Services
 
L+5.75% (6.75%), 9/5/2025
 
19,157

 
18,887

 
18,525

 
1.4
%
WMK, LLC (c) (k)
 
Business Services
 
L+5.75% (6.75%), 9/5/2025
 
2,591

 
2,582

 
2,529

 
0.2
%
WMK, LLC (c) (k)
 
Business Services
 
L+5.75% (6.75%), 9/5/2024
 
2,618

 
2,618

 
2,529

 
0.2
%
Subtotal Senior Secured First Lien Debt
 
 
 
 
 
$
1,673,953

 
$
1,559,237

 
115.8
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior Secured Second Lien Debt - 15.7% (b)
 
 
 
 
 
 
 
 
 
 
Accentcare, Inc. (c) (h)
 
Healthcare
 
L+8.75% (8.90%), 6/21/2027
 
$
17,795

 
$
17,422

 
$
17,297

 
1.3
%
Anchor Glass Container Corp. (c) (k)
 
Paper & Packaging
 
L+7.75% (8.75%), 12/6/2024
 
20,000

 
19,845

 
8,000

 
0.6
%
Astro AB Merger Sub, Inc. (a) (c) (h)
 
Financials
 
L+7.50% (8.50%), 4/28/2023
 
7,758

 
7,758

 
7,719

 
0.6
%
Avatar Purchaser, Inc. (c) (j)
 
Software/Services
 
L+7.50% (8.50%), 11/17/2025
 
11,716

 
11,491

 
11,294

 
0.8
%
Aveanna Healthcare, LLC (h)
 
Healthcare
 
L+8.00% (9.00%), 3/17/2025
 
5,883

 
5,833

 
5,442

 
0.4
%
BrandMuscle Holdings, Inc. (c) (k)
 
Business Services
 
L+8.50% (9.50%), 6/1/2022
 
24,500

 
24,373

 
23,091

 
1.7
%
Carlisle FoodService Products, Inc. (c) (h)
 
Consumer
 
L+7.75% (8.75%), 3/20/2026
 
10,719

 
10,573

 
10,449

 
0.8
%
CDS U.S. Intermediate Holdings, Inc. (a) (c) (t)
 
Media/Entertainment
 
L+8.25% (9.25%), 7/10/2023
 
9,177

 
8,961

 
459

 
0.0
%
Dentalcorp Perfect Smile, ULC (a) (c) (k)
 
Healthcare
 
L+7.50% (8.50%), 6/8/2026
 
10,139

 
10,065

 
10,098

 
0.8
%
Dimora Brands, Inc. (c) (k)
 
Consumer
 
L+8.50% (9.50%), 8/25/2025
 
4,464

 
4,463

 
4,464

 
0.3
%
Edelman Financial Services, LLC (a) (c) (j)
 
Financials
 
L+6.75% (6.89%), 7/20/2026
 
8,852

 
8,837

 
8,454

 
0.6
%
Hyland Software, Inc. (h)
 
Technology
 
L+7.00% (7.75%), 7/7/2025
 
6,904

 
6,927

 
6,855

 
0.5
%
ICP Industrial, Inc. (c) (k)
 
Chemicals
 
L+8.25% (9.25%), 5/3/2024
 
5,588

 
5,587

 
5,155

 
0.4
%

The accompanying notes are an integral part of these consolidated financial statements.
12
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
MLN US Holdco, LLC (a) (c) (h) (i)
 
Technology
 
L+8.75% (8.91%), 11/30/2026
 
$
3,000

 
$
2,954

 
$
1,992

 
0.2
%
PetVet Care Centers, LLC (c) (h)
 
Healthcare
 
L+6.25% (6.40%), 2/13/2026
 
3,539

 
3,527

 
3,437

 
0.3
%
PI US Holdco III, Ltd. (a) (c) (k)
 
Financials
 
L+7.25% (8.25%), 12/22/2025
 
7,865

 
7,808

 
7,314

 
0.6
%
ProAmpac, LLC (c) (k)
 
Paper & Packaging
 
L+8.50% (9.50%), 11/18/2024
 
3,352

 
3,351

 
3,251

 
0.2
%
Project Boost Purchaser, LLC (c) (k)
 
Business Services
 
L+8.00% (8.15%), 5/31/2027
 
1,848

 
1,848

 
1,791

 
0.1
%
QuickBase, Inc. (c)
 
Technology
 
L+8.00% (8.15%), 4/2/2027
 
7,484

 
7,362

 
7,353

 
0.5
%
Recess Holdings, Inc. (c) (h)
 
Industrials
 
L+7.75% (8.75%), 9/29/2025
 
16,134

 
15,959

 
14,843

 
1.1
%
Renaissance Holding Corp. (c)
 
Software/Services
 
L+7.00% (7.15%), 5/29/2026
 
8,456

 
8,336

 
8,118

 
0.6
%
River Cree Enterprises, LP (a) (c) (m)
 
Gaming/Lodging
 
10.00%, 5/17/2025
 
CAD
21,275

 
16,448

 
13,609

 
1.0
%
SSH Group Holdings, Inc. (c) (h)
 
Education
 
L+8.25% (8.47%), 7/30/2026
 
10,122

 
10,048

 
9,717

 
0.7
%
St. Croix Hospice Acquisition Corp. (c) (k)
 
Healthcare
 
L+8.75% (9.75%), 3/29/2024
 
2,056

 
1,996

 
2,056

 
0.2
%
TIBCO Software, Inc. (k)
 
Technology
 
L+7.25% (7.40%), 3/3/2028
 
13,020

 
12,959

 
12,695

 
0.9
%
Travelpro Products, Inc. (a) (c) (l)
 
Consumer
 
13.00%, 11/21/2022
 
2,492

 
2,491

 
2,024

 
0.2
%
Travelpro Products, Inc. (a) (c) (l) (m)
 
Consumer
 
13.00%, 11/21/2022
 
CAD
2,885

 
2,215

 
1,760

 
0.1
%
Vantage Mobility International, LLC (c) (l) (p) (t)
 
Transportation
 
L+6.00% (7.00%), 9/9/2021
 
3,282

 
2,914

 
2,174

 
0.2
%
Subtotal Senior Secured Second Lien Debt
 
 
 
 
 
$
242,351

 
$
210,911

 
15.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Subordinated Debt - 8.7% (b)
 
 
 
 
 
 
 
 
 
 
Captek Softgel International, Inc. (c) (l) (t)
 
Health/Fitness
 
11.50%, 1/30/2023
 
$
7,181

 
$
7,071

 
$
5,601

 
0.4
%
Del Real, LLC (c) (l) (t)
 
Food & Beverage
 
14.50%, 4/1/2023
 
3,509

 
3,131

 
2,961

 
0.2
%
DoorDash, Inc. (c) (k) (l)
 
Technology
 
10.00%, 3/1/2025
 
23,738

 
23,441

 
24,094

 
1.8
%
Gdb Debt Recovery Authority Of Commonwealth Puerto Rico (a) (l)
 
Financials
 
7.50%, 8/20/2040
 
13,003

 
9,689

 
8,953

 
0.6
%
HemaSource, Inc. (c) (k) (x)
 
Healthcare
 
11.00%, 1/1/2024
 
2,235

 
2,167

 
2,212

 
0.2
%
Park Ave RE Holdings, LLC (c) (k) (l) (o) (w)
 
Financials
 
13.00%, 12/31/2021
 
38,474

 
38,474

 
38,474

 
2.9
%
PCX Aerostructures, LLC (c) (k) (l) (p)
 
Industrials
 
6.00%, 8/9/2021
 
7,995

 
6,182

 
9,719

 
0.7
%
Siena Capital Finance, LLC (c) (k) (o)
 
Financials
 
12.50%, 5/15/2024
 
25,500

 
25,492

 
25,500

 
1.9
%
Subtotal Subordinated Debt
 
 
 
 
 
$
115,647

 
$
117,514

 
8.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Collateralized Securities - 7.1% (b)
 
 
 
 
 
 
 
 
 
 
Collateralized Securities - Debt Investments
 
 
 
 
 
 
 
 
 
 
Avery Point CLO, Ltd. 15-6A E1 (a) (c) (k)
 
Diversified Investment Vehicles
 
L+5.50% (5.75%), 8/6/2027
 
$
3,500

 
$
3,190

 
$
2,700

 
0.2
%
Babson CLO, Ltd. 16-2A ER (a) (c)
 
Diversified Investment Vehicles
 
L+6.50% (6.77%), 7/20/2028
 
2,650

 
2,393

 
2,397

 
0.2
%
Ballyrock, Ltd. 16-1A ER (a) (c)
 
Diversified Investment Vehicles
 
L+6.95% (7.23%), 10/16/2028
 
2,600

 
2,295

 
2,343

 
0.2
%

The accompanying notes are an integral part of these consolidated financial statements.
13
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Catamaran CLO, Ltd. 16-1A D (a) (c) (k)
 
Diversified Investment Vehicles
 
L+6.65% (6.92%), 1/18/2029
 
$
7,250

 
$
7,070

 
$
6,387

 
0.5
%
Cedar Funding, Ltd. 14-4A ER (a) (c)
 
Diversified Investment Vehicles
 
L+6.36% (6.62%), 7/23/2030
 
2,500

 
2,207

 
2,283

 
0.2
%
CIFC Funding, Ltd. 15-5A DR (a) (c)
 
Diversified Investment Vehicles
 
L+5.55% (5.79%), 10/25/2027
 
3,000

 
2,648

 
2,585

 
0.2
%
Crown Point CLO, Ltd. 2019-8A E (a) (c) (k)
 
Diversified Investment Vehicles
 
L+7.10% (7.37%), 10/20/2032
 
4,000

 
3,807

 
3,706

 
0.3
%
Dryden Senior Loan Fund 17-49A E (a) (c) (k)
 
Diversified Investment Vehicles
 
L+6.30% (6.57%), 7/18/2030
 
3,000

 
2,898

 
2,681

 
0.2
%
Dryden Senior Loan Fund 2014-36A ER2 (a) (c) (k)
 
Diversified Investment Vehicles
 
L+6.88% (7.16%), 4/15/2029
 
2,000

 
1,951

 
1,777

 
0.1
%
Eaton Vance CDO, Ltd. 15-1A FR (a) (c) (k)
 
Diversified Investment Vehicles
 
L+7.97% (8.24%), 1/20/2030
 
2,000

 
1,814

 
1,507

 
0.1
%
Greywolf CLO, Ltd. 20-3RA ER (a) (c) (k)
 
Diversified Investment Vehicles
 
L+8.74% (9.00%), 4/15/2033
 
1,000

 
933

 
725

 
0.1
%
Highbridge Loan Management, Ltd. 11A-17 E (a) (c)
 
Diversified Investment Vehicles
 
L+6.10% (6.35%), 5/6/2030
 
3,000

 
2,522

 
2,520

 
0.2
%
ICG US CLO, Ltd. 15-2RA D (a) (c) (k)
 
Diversified Investment Vehicles
 
L+6.99% (7.26%), 1/17/2033
 
1,500

 
1,429

 
1,088

 
0.1
%
Jamestown CLO, Ltd. 17-10A D (a) (c)
 
Diversified Investment Vehicles
 
L+6.70% (6.97%), 7/17/2029
 
1,200

 
971

 
1,013

 
0.1
%
LCM, Ltd. Partnership 16A ER2 (a) (c) (k)
 
Diversified Investment Vehicles
 
L+6.38% (6.66%), 10/15/2031
 
2,500

 
2,319

 
2,160

 
0.2
%
Madison Park Funding, Ltd. 14-13A ER (a) (c)
 
Diversified Investment Vehicles
 
L+5.75% (6.02%), 4/19/2030
 
2,500

 
2,018

 
2,122

 
0.1
%
NewStar Arlington Senior Loan Program, LLC 14-1A FR (a) (c) (k) (p) (t)
 
Diversified Investment Vehicles
 
L+11.00% (11.24%), 4/25/2031
 
4,750

 
4,554

 
3,496

 
0.2
%
Newstar Fairfield Fund CLO, Ltd. 2015-1RA F (a) (c) (k) (p) (t)
 
Diversified Investment Vehicles
 
L+7.50% (7.77%), 1/20/2027
 
10,728

 
9,626

 
5,002

 
0.4
%
OCP CLO, Ltd. 14-5A DR (a) (c) (k)
 
Diversified Investment Vehicles
 
L+5.70% (5.94%), 4/26/2031
 
2,200

 
2,069

 
1,897

 
0.1
%
Regatta II Funding, LP 13-2A DR2 (a) (c)
 
Diversified Investment Vehicles
 
L+6.95% (7.23%), 1/15/2029
 
2,000

 
1,783

 
1,783

 
0.1
%
Regatta IX Funding, Ltd. 17-1A E (a) (c)
 
Diversified Investment Vehicles
 
L+6.00% (6.27%), 4/17/2030
 
2,000

 
1,776

 
1,802

 
0.1
%
Sound Point CLO, Ltd. 16-1A ER (a) (c)
 
Diversified Investment Vehicles
 
L+5.25% (5.52%), 7/20/2028
 
3,750

 
3,054

 
3,195

 
0.2
%
Sound Point CLO, Ltd. 16-3A E (a) (c)
 
Diversified Investment Vehicles
 
L+6.65% (6.91%), 1/23/2029
 
2,500

 
2,124

 
2,123

 
0.1
%
Sound Point CLO, Ltd. 17-1A E (a) (c) (k)
 
Diversified Investment Vehicles
 
L+5.96% (6.22%), 1/23/2029
 
4,000

 
3,781

 
3,038

 
0.2
%
Sound Point CLO, Ltd. 18-3A D (a) (c) (k)
 
Diversified Investment Vehicles
 
L+5.79% (6.03%), 10/26/2031
 
1,000

 
915

 
780

 
0.1
%
Sound Point CLO, Ltd. 2015-3A ER (a) (c) (k)
 
Diversified Investment Vehicles
 
L+5.25% (5.52%), 1/20/2028
 
2,000

 
1,892

 
1,711

 
0.1
%
Symphony CLO, Ltd. 2012-9A ER2 (a) (c) (k)
 
Diversified Investment Vehicles
 
L+6.95% (7.22%), 7/16/2032
 
3,000

 
2,946

 
2,270

 
0.2
%
TCW CLO 2019-1 AMR, Ltd. 19-1A F (a) (c) (k)
 
Diversified Investment Vehicles
 
L+8.67% (8.95%), 2/15/2029
 
2,500

 
2,404

 
2,040

 
0.1
%
Tralee CLO, Ltd. 13-1A DR (a) (c)
 
Diversified Investment Vehicles
 
L+4.18% (4.45%), 7/20/2029
 
2,500

 
2,300

 
2,138

 
0.2
%
Whitehorse, Ltd. 2014-1A E (a) (c) (p)
 
Diversified Investment Vehicles
 
L+4.55% (4.80%), 5/1/2026
 
8,000

 
7,843

 
3,868

 
0.3
%
Zais CLO 13, Ltd. 19-13A D1 (a) (c) (k)
 
Diversified Investment Vehicles
 
L+4.52% (4.80%), 7/15/2032
 
3,000

 
2,863

 
2,466

 
0.2
%
Collateralized Securities - Equity Investments (n)
 
 
 
 
 
 
 
 
 
 

The accompanying notes are an integral part of these consolidated financial statements.
14
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Figueroa CLO, Ltd. 2014-1A Side Letter (a) (c)
 
Diversified Investment Vehicles
 
0.00%, 1/15/2027
 
$
2,986

 
$
260

 
$
—

 
—
%
MidOcean Credit CLO 2013-2A INC (a) (c) (p) (v)
 
Diversified Investment Vehicles
 
0.00%, 1/29/2030
 
37,600

 
15,829

 
4,038

 
0.3
%
NewStar Arlington Senior Loan Program, LLC 14-1A SUB (a) (c) (k) (p) (v)
 
Diversified Investment Vehicles
 
0.00%, 4/25/2031
 
31,603

 
19,121

 
16,105

 
1.2
%
Newstar Fairfield Fund CLO, Ltd. 2015-1RA SUB (a) (c) (p) (v)
 
Diversified Investment Vehicles
 
0.00%, 1/20/2027
 
31,575

 
6,285

 
—

 
0.0
%
OFSI Fund, Ltd. 2014-6A Side Letter (a) (c)
 
Diversified Investment Vehicles
 
0.00%, 3/20/2025
 
1,970

 
263

 
—

 
0.0
%
Whitehorse, Ltd. 2014-1A Side Letter (a) (c) (p)
 
Diversified Investment Vehicles
 
0.00%, 5/1/2026
 
1,886

 
134

 
—

 
—
%
Whitehorse, Ltd. 2014-1A SUB (a) (c) (p) (v)
 
Diversified Investment Vehicles
 
0.00%, 5/1/2026
 
36,000

 
6,965

 
—

 
—
%
Subtotal Collateralized Securities
 
 
 
 
 
$
139,252

 
$
95,746

 
7.1
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity/Other - 16.9% (b) (d)
 
 
 
 
 
 
 
 
 
 
Aden & Anais Holdings, Inc. (c) (e) (x)
 
Retail
 
 
 
4,470

 
$
—

 
$
—

 
—
%
Answers Corp. (c) (e) (p)
 
Media/Entertainment
 
 
 
908,911

 
11,361

 
727

 
0.1
%
Baker Hill Acquisition, LLC (c) (e)
 
Financials
 
 
 
22,653

 
—

 
—

 
—
%
Black Mountain Sand, LLC (c) (e) (u)
 
Energy
 
 
 
55,463

 
—

 
3

 
—
%
Capstone Nutrition Development, LLC (c) (e) (p) (u)
 
Consumer
 
 
 
47,883

 
4,468

 
5,119

 
0.4
%
Captek Softgel International, Inc. (c) (e) (x)
 
Health/Fitness
 
 
 
8,498

 
942

 
—

 
0.0
%
Clover Technologies Group, LLC (c) (e) (j)
 
Industrials
 
 
 
2,753

 
275

 
425

 
0.0
%
Clover Technologies Group, LLC (c) (e) (j)
 
Industrials
 
 
 
180,274

 
1,153

 
20

 
0.0
%
CRD Holdings, LLC (c) (o) (u)
 
Energy
 
9.00%
 
52,285,603

 
21,537

 
23,055

 
1.7
%
CRS-SPV, Inc. (c) (e) (k) (o)
 
Industrials
 
 
 
246

 
2,219

 
1,393

 
0.1
%
Danish CRJ, Ltd. (a) (c) (e) (p) (r)
 
Transportation
 
 
 
5,002

 
—

 
—

 
0.0
%
Data Source Holdings, LLC (c) (e)
 
Business Services
 
 
 
10,617

 
140

 
203

 
—
%
Del Real, LLC (c) (e) (u)
 
Food & Beverage
 
 
 
670,510

 
382

 
—

 
0.0
%
Dyno Acquiror, Inc. (c) (e)
 
Consumer
 
 
 
134,102

 
58

 
80

 
—
%
First Eagle Greenway Fund II, LLC (a) (k) (p)
 
Diversified Investment Vehicles
 
 
 
5,329

 
5,329

 
1,771

 
0.1
%
Foresight Energy Operating, LLC (c) (e) (p) (u)
 
Industrials
 
 
 
158,093

 
2,087

 
2,116

 
0.2
%
HemaSource, Inc. (c) (e) (x)
 
Healthcare
 
 
 
223,503

 
168

 
212

 
0.0
%
ICP Industrial, Inc. (c) (e)
 
Chemicals
 
 
 
288

 
279

 
389

 
—
%
Integrated Efficiency Solutions, Inc. (c) (e)
 
Industrials
 
 
 
53,215

 
56

 
—

 
—
%
Integrated Efficiency Solutions, Inc. (c) (e)
 
Industrials
 
 
 
2,975

 
3

 
—

 
0.0
%
Internap Corp (c) (e) (p)
 
Business Services
 
 
 
1,293,189

 
543

 
1,611

 
0.1
%
Jakks Pacific, Inc. (c) (e) (p)
 
Consumer
 
 
 
3,389

 
102

 
402

 
—
%
Jakks Pacific, Inc. (e) (p) (s)
 
Consumer
 
 
 
9,884

 
41

 
38

 
—
%
Kahala Ireland OpCo Designated Activity Company (a) (c) (e) (o) (z)
 
Transportation
 
 
 
1

 
—

 
51,952

 
3.9
%
Kahala Ireland OpCo Designated Activity Company (a) (c) (e) (o) (z)
 
Transportation
 
 
 
3,250,000

 
2,797

 
3,250

 
0.3
%

The accompanying notes are an integral part of these consolidated financial statements.
15
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Kahala US OpCo, LLC (a) (c) (e) (o) (aa)
 
Transportation
 
13.00%
 
4,413,472

 
$
—

 
$
—

 
—
%
KidKraft, Inc. (c) (e) (u)
 
Consumer
 
 
 
2,682,257

 
—

 
—

 
—
%
KMTEX, LLC (c) (e) (o) (u)
 
Chemicals
 
 
 
4,162,000

 
2,793

 
6,451

 
0.5
%
KMTEX, LLC (c) (e) (o) (u)
 
Chemicals
 
 
 
442,000

 
—

 
—

 
—
%
Lakeview Health Holdings, Inc. (c) (e)
 
Healthcare
 
 
 
447

 
—

 
—

 
0.0
%
MGTF Holdco, LLC (c) (e) (o) (u)
 
Media/Entertainment
 
 
 
402,000

 
—

 
—

 
0.0
%
Mood Media Corp. (c) (e) (p)
 
Media/Entertainment
 
 
 
4,621,109

 
2,713

 
4,383

 
0.3
%
Motor Vehicle Software Corp. (c) (x)
 
Business Services
 
 
 
223,503

 
318

 
201

 
—
%
New Constellis Holdings Inc. (c) (e)
 
Business Services
 
 
 
2,316

 
67

 
67

 
0.0
%
NMFC Senior Loan Program I, LLC (a) (o)
 
Diversified Investment Vehicles
 
 
 
50,000

 
50,000

 
43,280

 
3.2
%
Nomacorc, LLC (c) (e) (u)
 
Industrials
 
 
 
356,816

 
56

 
80

 
—
%
Park Ave RE Holdings, LLC (c) (e) (k) (o) (w)
 
Financials
 
 
 
719

 
2,415

 
1,812

 
0.1
%
PCX Aerostructures, LLC (c) (e) (p)
 
Industrials
 
 
 
27,250

 
—

 
—

 
—
%
PCX Aerostructures, LLC (c) (e) (p)
 
Industrials
 
 
 
1,356

 
—

 
—

 
0.0
%
PCX Aerostructures, LLC (c) (e) (p)
 
Industrials
 
 
 
315

 
—

 
437

 
—
%
PennantPark Credit Opportunities Fund II, LP (a) (p)
 
Diversified Investment Vehicles
 
 
 
8,739

 
8,739

 
9,083

 
0.7
%
PT Network, LLC (c) (e) (u)
 
Healthcare
 
 
 
3

 
—

 
—

 
—
%
RMP Group, Inc. (c) (u)
 
Financials
 
 
 
223

 
164

 
299

 
—
%
Schweiger Dermatology Group, LLC (c) (e) (u)
 
Healthcare
 
 
 
265,024

 
—

 
—

 
—
%
Siena Capital Finance, LLC (c) (k) (o)
 
Financials
 
 
 
35,839,400

 
36,548

 
31,538

 
2.3
%
Skillsoft Corp. (c) (e) (j)
 
Technology
 
 
 
39,794

 
4,993

 
4,995

 
0.4
%
Smile Brands, Inc. (c) (e)
 
Healthcare
 
 
 
712

 
815

 
797

 
0.1
%
Squan Holding Corp. (c) (e)
 
Telecom
 
 
 
180,835

 
—

 
—

 
0.0
%
St. Croix Hospice Acquisition Corp. (c) (e)
 
Healthcare
 
 
 
112

 
—

 
173

 
0.0
%
St. Croix Hospice Acquisition Corp. (c) (e)
 
Healthcare
 
 
 
112

 
64

 
142

 
—
%
SYNACOR, Inc. (e) (s)
 
Technology
 
 
 
59,785

 
—

 
90

 
—
%
Tap Rock Resources, LLC (c) (e) (g) (p) (u)
 
Energy
 
 
 
18,356,442

 
13,328

 
14,760

 
1.1
%
Tax Advisors Group, LLC (c) (u)
 
Financials
 
 
 
86

 
609

 
755

 
0.1
%
Tax Defense Network, LLC (c) (e) (p)
 
Consumer
 
 
 
147,099

 
425

 
—

 
0.0
%
Tax Defense Network, LLC (c) (e) (p)
 
Consumer
 
 
 
633,382

 
—

 
—

 
0.0
%
Team Waste, LLC (c) (p) (u)
 
Industrials
 
 
 
128,483

 
2,569

 
2,570

 
0.2
%
Tennenbaum Waterman Fund, LP (a) (k) (p)
 
Diversified Investment Vehicles
 
 
 
10,000

 
10,000

 
9,321

 
0.7
%
Travelpro Products, Inc. (a) (c) (e)
 
Consumer
 
 
 
447,007

 
506

 
—

 
—
%
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
4,206

 
31

 
15

 
—
%
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
3,155

 
—

 
—

 
0.0
%

The accompanying notes are an integral part of these consolidated financial statements.
16
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
99,236

 
$
—

 
$
—

 
0.0
%
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
39,769

 
132

 
21

 
—
%
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
223

 
35

 
9

 
0.0
%
USASF Holdco, LLC (c) (e) (u)
 
Financials
 
 
 
10,000

 
10

 
—

 
0.0
%
USASF Holdco, LLC (c) (e) (u)
 
Financials
 
 
 
490

 
490

 
228

 
—
%
USASF Holdco, LLC (c) (e) (u)
 
Financials
 
 
 
139

 
139

 
694

 
0.1
%
Vantage Mobility International, LLC (c) (e) (p)
 
Transportation
 
 
 
1,468,221

 
—

 
—

 
—
%
Vantage Mobility International, LLC (c) (e) (p)
 
Transportation
 
 
 
391,131

 
—

 
—

 
—
%
Vantage Mobility International, LLC (c) (e) (p)
 
Transportation
 
 
 
3,280,908

 
3,140

 
—

 
—
%
Women's Marketing, Inc. (c) (e)
 
Media/Entertainment
 
 
 
3,643

 
—

 
—

 
—
%
World Business Lenders, LLC (c) (e)
 
Financials
 
 
 
922,669

 
3,750

 
2,168

 
0.2
%
WPNT, LLC (c) (e) (o) (u)
 
Media/Entertainment
 
 
 
402,000

 
—

 
—

 
—
%
WSO Holdings, LP (c) (e)
 
Food & Beverage
 
 
 
698

 
280

 
208

 
—
%
Wythe Will Tzetzo, LLC (c) (e) (u)
 
Food & Beverage
 
 
 
22,312

 
302

 
—

 
—
%
YummyEarth, Inc. (c) (e)
 
Food & Beverage
 
 
 
223

 
—

 
—

 
—
%
Subtotal Equity/Other
 
 
 
 
 
$
199,371

 
$
227,343

 
16.9
%
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL INVESTMENTS - 164.2% (b)
 
 
 
 
 
$
2,370,574

 
$
2,210,751

 
164.2
%
Forward foreign currency contracts:
Counterparty
 
Contract to Deliver
 
In Exchange For
 
Maturity Date
 
Unrealized Appreciation
Goldman Sachs International
 
CAD 21,884
 
$
16,443

 
8/7/2020
 
$
54

_____________
(a)
All of the Company's investments, except the investments noted by this footnote, are qualifying assets under Section 55(a) of the Investment Company Act of 1940, as amended (the "1940 Act"). Under the 1940 Act, the Company may not acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of the Company's total assets. Qualifying assets represent 81.9% of the Company's total assets. The significant majority of all investments held are deemed to be illiquid.
(b)
Percentages are based on net assets as of September 30, 2020.
(c)
The fair value of investments with respect to securities for which market quotations are not readily available is determined in good faith by the Company's Board of Directors as required by the 1940 Act. Such investments are valued using significant unobservable inputs (See Note 3 to the consolidated financial statements).
(d)
All amounts are in thousands except share amounts.
(e)
Non-income producing at September 30, 2020.
(f)
The Company has various unfunded commitments to portfolio companies. Please refer to Note 7 - Commitments and Contingencies for details of these unfunded commitments.
(g)
The commitment related to this investment is discretionary.
(h)
The Company's investment or a portion thereof is pledged as collateral under the JPM Credit Facility. Individual investments can be divided into parts which are pledged to separate credit facilities.
(i)
The Company's investment or a portion thereof is pledged as collateral under the Wells Fargo Credit Facility. Individual investments can be divided into parts which are pledged to separate credit facilities.
(j)
The Company's investment or a portion thereof is pledged as collateral under the Citi Credit Facility. Individual investments can be divided into parts which are pledged to separate credit facilities.
(k)
The Company's investment or a portion thereof is pledged as collateral under the MassMutual Credit Facility. Individual investments can be divided into parts which are pledged to separate credit facilities.

The accompanying notes are an integral part of these consolidated financial statements.
17
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

(l)
For the three months ended September 30, 2020, the following investments paid or have the option to pay all or a portion of interest and dividends via payment-in-kind (“PIK”):
September 30, 2020
(Unaudited)
Portfolio Company
 
Investment Type
 
Cash
 
PIK
 
All-in Rate
 
PIK earned for the three months ended September 30, 2020
Black Mountain Sand, LLC
 
Senior Secured First Lien Debt
 
12.50
%
 
—
%
 
12.50
%
 
$
—

Boston Market Corp.
 
Senior Secured First Lien Debt
 
—
%
 
5.00
%
 
5.00
%
 
—

CCW, LLC
 
Senior Secured First Lien Debt
 
—
%
 
9.00
%
 
9.00
%
 
—

CCW, LLC
 
Senior Secured First Lien Debt
 
—
%
 
9.00
%
 
9.00
%
 
—

CDHA Holdings, LLC
 
Senior Secured First Lien Debt
 
6.75
%
 
1.00
%
 
7.75
%
 
1

CDHA Holdings, LLC
 
Senior Secured First Lien Debt
 
7.25
%
 
1.00
%
 
8.25
%
 
3

CDHA Holdings, LLC
 
Senior Secured First Lien Debt
 
7.25
%
 
1.00
%
 
8.25
%
 
40

Foresight Energy Operating, LLC
 
Senior Secured First Lien Debt
 
—
%
 
9.50
%
 
9.50
%
 
10

Gold Standard Baking, Inc.
 
Senior Secured First Lien Debt
 
7.50
%
 
2.00
%
 
9.50
%
 
16

Integral Ad Science, Inc.
 
Senior Secured First Lien Debt
 
7.00
%
 
1.25
%
 
8.25
%
 
49

Integrated Efficiency Solutions, Inc.
 
Senior Secured First Lien Debt
 
8.00
%
 
3.00
%
 
11.00
%
 
41

Internap Corp.
 
Senior Secured First Lien Debt
 
4.00
%
 
3.50
%
 
7.50
%
 
36

Jakks Pacific, Inc.
 
Senior Secured First Lien Debt
 
8.00
%
 
2.50
%
 
10.50
%
 
—

Kahala Ireland OpCo Designated Activity Company
 
Senior Secured First Lien Debt
 
13.00
%
 
—
%
 
13.00
%
 
—

KidKraft, Inc.
 
Senior Secured First Lien Debt
 
—
%
 
7.00
%
 
7.00
%
 
—

KMTEX, LLC
 
Senior Secured First Lien Debt
 
—
%
 
6.25
%
 
6.25
%
 
—

KMTEX, LLC
 
Senior Secured First Lien Debt
 
—
%
 
6.25
%
 
6.25
%
 
58

KMTEX, LLC
 
Senior Secured First Lien Debt
 
—
%
 
6.25
%
 
6.25
%
 
13

Lakeland Tours, LLC
 
Senior Secured First Lien Debt
 
7.25
%
 
6.00
%
 
13.25
%
 
199

Lakeland Tours, LLC
 
Senior Secured First Lien Debt
 
7.25
%
 
6.00
%
 
13.25
%
 
—

Lakeland Tours, LLC
 
Senior Secured First Lien Debt
 
2.75
%
 
6.00
%
 
8.75
%
 
—

Lakeland Tours, LLC
 
Senior Secured First Lien Debt
 
2.75
%
 
6.00
%
 
8.75
%
 
—

Lakeland Tours, LLC
 
Senior Secured First Lien Debt
 
—
%
 
13.25
%
 
13.25
%
 
—

Lakeview Health Holdings, Inc.
 
Senior Secured First Lien Debt
 
—
%
 
9.75
%
 
9.75
%
 
—

Lakeview Health Holdings, Inc.
 
Senior Secured First Lien Debt
 
—
%
 
9.75
%
 
9.75
%
 
—

LightSquared, LP
 
Senior Secured First Lien Debt
 
12.75
%
 
—
%
 
12.75
%
 
156

Medical Depot Holdings, Inc.
 
Senior Secured First Lien Debt
 
8.50
%
 
2.00
%
 
10.50
%
 
97

Mood Media Corp.
 
Senior Secured First Lien Debt
 
8.25
%
 
2.00
%
 
10.25
%
 
—

Mood Media Corp.
 
Senior Secured First Lien Debt
 
8.25
%
 
2.00
%
 
10.25
%
 
—

PGX Holdings, Inc.
 
Senior Secured First Lien Debt
 
6.25
%
 
4.25
%
 
10.50
%
 
—

PT Network, LLC
 
Senior Secured First Lien Debt
 
6.73
%
 
2.00
%
 
8.73
%
 
86

Resco Products, Inc.
 
Senior Secured First Lien Debt
 
7.00
%
 
2.00
%
 
9.00
%
 
—

Squan Holding Corp.
 
Senior Secured First Lien Debt
 
8.00
%
 
1.00
%
 
9.00
%
 
28

Tax Defense Network, LLC
 
Senior Secured First Lien Debt
 
—
%
 
10.00
%
 
10.00
%
 
—

Tax Defense Network, LLC
 
Senior Secured First Lien Debt
 
—
%
 
10.00
%
 
10.00
%
 
—

Tax Defense Network, LLC
 
Senior Secured First Lien Debt
 
—
%
 
10.00
%
 
10.00
%
 
—

Trademark Global, LLC
 
Senior Secured First Lien Debt
 
9.00
%
 
2.00
%
 
11.00
%
 
17

Travelpro Products, Inc.
 
Senior Secured Second Lien Debt
 
11.00
%
 
2.00
%
 
13.00
%
 
75

Travelpro Products, Inc.
 
Senior Secured Second Lien Debt
 
11.00
%
 
2.00
%
 
13.00
%
 
64

Vantage Mobility International, LLC
 
Senior Secured Second Lien Debt
 
—
%
 
7.00
%
 
7.00
%
 
—

Captek Softgel International, Inc.
 
Subordinated Debt
 
10.00
%
 
1.50
%
 
11.50
%
 
—

Del Real, LLC
 
Subordinated Debt
 
12.50
%
 
2.00
%
 
14.50
%
 
—

DoorDash, Inc.
 
Subordinated Debt
 
—
%
 
10.00
%
 
10.00
%
 
566

Gdb Debt Recovery Authority Of Commonwealth Puerto Rico
 
Subordinated Debt
 
7.50
%
 
—
%
 
7.50
%
 
—

Park Ave RE Holdings, LLC
 
Subordinated Debt
 
13.00
%
 
—
%
 
13.00
%
 
1,237

PCX Aerostructures, LLC
 
Subordinated Debt
 
6.00
%
 
—
%
 
6.00
%
 
—

Total
 
 
 
 
 
 
 
 
 
$
2,792


The accompanying notes are an integral part of these consolidated financial statements.
18
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

(m)
The principal amount (par amount) is denominated in Canadian Dollars or CAD.
(n)
For equity investments in Collateralized Securities, the effective yield is presented in place of the investment coupon rate for each investment. Refer to footnote (v) for a further description of an equity investment in a Collateralized Security.
(o)
The provisions of the 1940 Act classify investments based on the level of control that the Company maintains in a particular portfolio company. As defined in the 1940 Act, a company is generally presumed to be "non-controlled" when the Company owns 25% or less of the portfolio company's voting securities and/or does not have the power to exercise control over the management or policies of such portfolio company. A company is generally presumed to be "controlled" when the Company owns more than 25% of the portfolio company's voting securities and/or has the power to exercise control over the management or policies of such portfolio company. The Company classifies this investment as "controlled".
(p)
The provisions of the 1940 Act classify investments further based on the level of ownership that the Company maintains in a particular portfolio company. As defined in the 1940 Act, a company is generally deemed as "non-affiliated" when the Company owns less than 5% of a portfolio company's voting securities and "affiliated" when the Company owns 5% or more of a portfolio company's voting securities. The Company classifies this investment as "affiliated".
(q)
Unless otherwise indicated, all investments in the consolidated schedule of investments are non-affiliated, non-controlled investments.
(r)
The Company's investment is held through the Consolidated Holding Company, Kahala Aviation Holdings, LLC, which owns 49% of the operating company, Danish CRJ LTD.
(s)
The investment is not a restricted security. All other securities are restricted securities.
(t)
The investment is on non-accrual status as of September 30, 2020.
(u)
Investments are held in the taxable wholly-owned, consolidated subsidiary, 54th Street Equity Holdings, Inc.
(v)
The Collateralized Securities - subordinated notes are treated as equity investments and are entitled to recurring distributions which are generally equal to the remaining cash flow of the payments made by the underlying fund’s securities less contractual payments to debt holders and fund expenses. The estimated yield indicated is based upon a current projection of the amount and timing of these recurring distributions and the estimated amount of repayment of principal upon termination. Such projections are periodically reviewed and adjusted, and the estimated yield may not ultimately be realized.
(w)
The Company's investment is held through the consolidated subsidiary, Park Ave RE, Inc., which owns 100% of the equity of the operating company, Park Ave RE Holdings, LLC.
(x)
The investment is held through BSP TCAP Acquisition Holdings LP which, as further outlined in Note 1, is an affiliated acquisition entity utilized for the Triangle Transaction. Due to certain restrictions, such as limits on the number of partners allowable within the equity structures of the newly acquired investments, these investments are still held within the acquisition entity as of September 30, 2020. 
(y)
The majority of the investments bear interest at a rate that may be determined by reference to London Interbank Offered Rate ("LIBOR" or "L") or Prime ("P") and which reset daily, monthly, quarterly, or semiannually. For each, the Company has provided the spread over LIBOR or Prime and the current interest rate in effect at September 30, 2020. 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.
(z)
The Company's investment is held through the consolidated subsidiary, Kahala Aviation Holdings, LLC, which owns 100% of the equity of the operating company, Kahala Ireland OpCo Designated Activity Company.
(aa)
The Company's investment is held through the consolidated subsidiaries, Kahala Aviation Holdings, LLC and Kahala Aviation US, Inc. which own 100% of the equity of the operating company, Kahala US OpCo LLC.


The accompanying notes are an integral part of these consolidated financial statements.
19
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

September 30, 2020
(Unaudited)
The following table shows the portfolio composition by industry grouping based on fair value at September 30, 2020:
 
At September 30, 2020
 
Investments at
Fair Value
 
Percentage of
Total Portfolio
Industrials
$
339,569

 
15.4
%
Healthcare
323,194

 
14.6
%
Business Services
304,610

 
13.8
%
Financials
178,717

 
8.1
%
Diversified Investment Vehicles
159,201

 
7.2
%
Technology
137,074

 
6.2
%
Energy
122,344

 
5.5
%
Media/Entertainment
112,101

 
5.1
%
Transportation
95,879

 
4.3
%
Food & Beverage
85,605

 
3.9
%
Consumer
64,164

 
2.9
%
Software/Services
62,212

 
2.8
%
Telecom
62,021

 
2.8
%
Education
54,419

 
2.5
%
Chemicals
44,915

 
2.0
%
Paper & Packaging
28,889

 
1.3
%
Gaming/Lodging
28,161

 
1.3
%
Health/Fitness
5,601

 
0.2
%
Utilities
2,075

 
0.1
%
Total
$
2,210,751

 
100.0
%

The accompanying notes are an integral part of these consolidated financial statements.
20
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior Secured First Lien Debt - 120.6% (b)
 
 
 
 
 
 
 
 
 
 
Abaco Systems Holding Corp. (c) (i)
 
Industrials
 
L+6.00% (8.01%), 12/7/2021
 
$
23,215

 
$
23,032

 
$
23,215

 
1.6
%
ABC Financial Intermediate, LLC (j)
 
Technology
 
L+4.25% (5.99%), 1/2/2025
 
14,603

 
14,550

 
14,493

 
1.0
%
Accentcare, Inc. (c) (j)
 
Healthcare
 
L+5.00% (6.95%), 6/22/2026
 
13,472

 
13,347

 
13,346

 
0.9
%
Acrisure, LLC (i) (j)
 
Financials
 
L+4.25% (6.19%), 11/22/2023
 
20,263

 
20,255

 
20,288

 
1.4
%
AHP Health Partners, Inc. (i)
 
Healthcare
 
L+4.50% (6.30%), 6/30/2025
 
19,886

 
19,739

 
20,016

 
1.4
%
Aldevron, LLC (i)
 
Healthcare
 
L+4.25% (6.19%), 10/13/2026
 
11,370

 
11,260

 
11,484

 
0.8
%
Aleris International, Inc. (j)
 
Industrials
 
L+4.75% (6.55%), 2/27/2023
 
21,095

 
20,987

 
21,085

 
1.4
%
Allied Universal Security Services, LLC (j)
 
Business Services
 
L+4.25% (6.05%), 7/10/2026
 
6,066

 
6,010

 
6,097

 
0.4
%
Allied Universal Security Services, LLC (j)
 
Business Services
 
L+4.25% (6.05%), 7/10/2026
 
601

 
601

 
604

 
0.0
%
Alvogen Pharma US, Inc. (j)
 
Healthcare
 
L+4.75% (6.55%), 12/31/2023
 
12,818

 
12,767

 
10,871

 
0.7
%
AM General, LLC (c) (i)
 
Industrials
 
L+7.25% (9.31%), 12/28/2021
 
1,626

 
1,626

 
1,626

 
0.1
%
American Greetings Corp. (j)
 
Consumer
 
L+4.50% (6.30%), 4/5/2024
 
1,723

 
1,698

 
1,690

 
0.1
%
AMI Entertainment Network, LLC (c) (i)
 
Media/Entertainment
 
L+6.00% (7.94%), 7/21/2022
 
3,667

 
3,618

 
3,618

 
0.3
%
AMI Entertainment Network, LLC (c) (i)
 
Media/Entertainment
 
L+6.00% (7.94%), 7/21/2022
 
12,983

 
12,851

 
12,809

 
0.9
%
AP Gaming I, LLC (a) (j)
 
Gaming/Lodging
 
L+3.50% (5.30%), 2/15/2024
 
7,621

 
7,616

 
7,640

 
0.5
%
AP NMT Acquisition B.V. (a) (j)
 
Media/Entertainment
 
L+5.75% (7.84%), 8/13/2021
 
5,831

 
5,839

 
5,842

 
0.4
%
Aq Carver Buyer, Inc. (c) (i)
 
Business Services
 
L+5.00% (6.94%), 9/23/2025
 
9,391

 
8,656

 
9,298

 
0.6
%
AqGen Ascensus, Inc. (j)
 
Business Services
 
L+4.00% (5.94%), 12/5/2022
 
9,392

 
9,383

 
9,398

 
0.6
%
AqGen Ascensus, Inc. (j)
 
Business Services
 
L+4.25% (6.05%), 12/5/2022
 
7,980

 
7,923

 
8,020

 
0.6
%
Arch Global Precision, LLC (c) (i)
 
Industrials
 
L+4.75% (6.55%), 4/1/2026
 
8,660

 
8,591

 
8,626

 
0.6
%
Athenahealth, Inc. (j)
 
Healthcare
 
L+4.50% (6.40%), 2/11/2026
 
12,792

 
12,632

 
12,840

 
0.9
%
Avaya Holdings Corp. (a) (j)
 
Technology
 
L+4.25% (5.99%), 12/16/2024
 
20,906

 
20,763

 
20,477

 
1.4
%
Aveanna Healthcare, LLC (c) (j)
 
Healthcare
 
L+5.50% (7.30%), 3/18/2024
 
6,021

 
5,807

 
5,648

 
0.4
%
Aveanna Healthcare, LLC (c) (j)
 
Healthcare
 
L+4.25% (6.05%), 3/18/2024
 
784

 
746

 
721

 
0.0
%
Axiom Global, Inc. (c) (i)
 
Business Services
 
L+4.75% (6.85%), 10/1/2026
 
10,974

 
10,868

 
10,869

 
0.7
%
BBB Industries, LLC (j)
 
Transportation
 
L+4.50% (6.30%), 8/1/2025
 
11,142

 
11,100

 
10,826

 
0.7
%
BCP Raptor, LLC (j)
 
Energy
 
L+4.25% (6.05%), 6/24/2024
 
19,033

 
18,903

 
17,511

 
1.2
%
BCP Renaissance, LLC (j)
 
Energy
 
L+3.50% (5.44%), 10/31/2024
 
3,420

 
3,408

 
3,022

 
0.2
%

The accompanying notes are an integral part of these consolidated financial statements.
21
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Black Mountain Sand, LLC (c)
 
Energy
 
L+9.00% (10.91%), 11/30/2021
 
$
13,050

 
$
12,946

 
$
12,854

 
0.9
%
Black Mountain Sand, LLC (c)
 
Energy
 
L+9.00% (11.10%), 11/30/2021
 
12,606

 
12,516

 
12,417

 
0.9
%
BMC Software Finance, Inc. (j)
 
Technology
 
L+4.25% (6.05%), 10/2/2025
 
22,013

 
21,831

 
21,741

 
1.5
%
Bomgar Corp. (j)
 
Technology
 
L+4.00% (5.93%), 4/18/2025
 
1,962

 
1,955

 
1,911

 
0.1
%
BrightSpring Health Holdings Corp. (j)
 
Healthcare
 
L+4.50% (6.21%), 3/5/2026
 
4,975

 
4,939

 
4,997

 
0.3
%
California Resources Corp. (a) (j)
 
Energy
 
L+4.75% (6.55%), 12/30/2022
 
12,259

 
12,110

 
10,926

 
0.7
%
CareCentrix, Inc. (i) (j)
 
Healthcare
 
L+4.50% (6.44%), 4/3/2025
 
19,856

 
19,783

 
19,807

 
1.4
%
CCW, LLC (c)
 
Food & Beverage
 
L+7.00% (8.81%), 3/22/2021
 
1,300

 
1,300

 
1,235

 
0.1
%
CCW, LLC (c) (i)
 
Food & Beverage
 
L+7.00% (8.81%), 3/22/2021
 
26,725

 
26,608

 
25,389

 
1.7
%
CDHA Holdings, LLC (c)
 
Healthcare
 
L+6.00% (7.95%), 8/24/2023
 
430

 
430

 
430

 
0.0
%
CDHA Holdings, LLC (c)
 
Healthcare
 
L+6.00% (7.95%), 8/24/2023
 
553

 
546

 
553

 
0.0
%
CDHA Holdings, LLC (c) (i)
 
Healthcare
 
L+6.00% (7.95%), 8/24/2023
 
15,601

 
15,430

 
15,601

 
1.1
%
CDS U.S. Intermediate Holdings, Inc. (a) (i) (j)
 
Media/Entertainment
 
L+3.75% (5.69%), 7/8/2022
 
3,980

 
3,905

 
3,775

 
0.3
%
Chloe Ox Parent, LLC (i)
 
Healthcare
 
L+4.50% (6.44%), 12/23/2024
 
11,478

 
11,394

 
11,406

 
0.8
%
Clarion Events, Ltd. (a) (j)
 
Business Services
 
L+5.00% (6.91%), 9/30/2024
 
10,393

 
10,233

 
10,172

 
0.7
%
Clover Technologies Group, LLC (c) (j)
 
Industrials
 
L+6.50% (8.30%), 5/8/2020
 
8,603

 
8,598

 
2,882

 
0.2
%
CLP Health Services, Inc. (i)
 
Healthcare
 
L+5.00% (6.80%), 12/31/2026
 
9,480

 
9,338

 
9,409

 
0.6
%
Cold Spring Brewing, Co. (c) (i)
 
Food & Beverage
 
L+4.75% (6.55%), 12/19/2025
 
9,888

 
9,789

 
9,789

 
0.7
%
Community Care Health Network, LLC (j)
 
Healthcare
 
L+4.75% (6.55%), 2/17/2025
 
5,076

 
5,062

 
4,999

 
0.3
%
CONSOL Energy, Inc. (a) (c) (j)
 
Industrials
 
L+4.50% (6.30%), 9/27/2024
 
4,120

 
4,102

 
3,794

 
0.3
%
Conterra Ultra Broadband, LLC (c) (j)
 
Telecom
 
L+4.50% (6.30%), 4/30/2026
 
5,009

 
4,987

 
5,009

 
0.3
%
Corfin Industries, LLC (c) (i)
 
Industrials
 
L+5.50% (7.43%), 2/15/2024
 
8,486

 
8,369

 
8,486

 
0.6
%
Crown Subsea Communications Holding, Inc. (c) (j)
 
Industrials
 
L+6.00% (7.69%), 11/3/2025
 
3,328

 
3,300

 
3,328

 
0.2
%
CRS-SPV, Inc. (c) (o)
 
Industrials
 
L+4.50% (6.30%), 3/8/2020
 
62

 
62

 
62

 
0.0
%
Digicel Group, Ltd. (a)
 
Telecom
 
8.75%, 5/25/2024
 
10,607

 
10,556

 
10,342

 
0.7
%
Dynasty Acquisition Co., Inc. (j)
 
Industrials
 
L+4.00% (5.94%), 4/6/2026
 
3,871

 
3,857

 
3,895

 
0.3
%
Dynasty Acquisition Co., Inc. (j)
 
Industrials
 
L+4.00% (5.94%), 4/6/2026
 
2,081

 
2,074

 
2,094

 
0.1
%
Eagle Rx, LLC (c) (i)
 
Healthcare
 
L+4.75% (6.44%), 12/31/2021
 
26,438

 
26,435

 
26,438

 
1.8
%
Envision Healthcare Corp. (j)
 
Healthcare
 
L+3.75% (5.55%), 10/10/2025
 
3,970

 
3,806

 
3,376

 
0.2
%

The accompanying notes are an integral part of these consolidated financial statements.
22
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Florida Food Products, LLC (c)
 
Food & Beverage
 
L+6.75% (8.55%), 9/6/2023
 
$
1,416

 
$
1,416

 
$
1,399

 
0.1
%
Florida Food Products, LLC (c) (i)
 
Food & Beverage
 
L+6.75% (8.55%), 9/6/2025
 
22,114

 
21,666

 
21,849

 
1.5
%
Foresight Energy, LLC (c) (j)
 
Industrials
 
L+5.75% (7.66%), 3/28/2022
 
5,919

 
5,888

 
2,721

 
0.2
%
Frontier Communications Corp.
 
Telecom
 
8.00%, 4/1/2027
 
15,332

 
15,341

 
16,054

 
1.1
%
Frontier Communications Corp. (j)
 
Telecom
 
L+3.75% (5.55%), 6/17/2024
 
9,819

 
9,643

 
9,853

 
0.7
%
Gold Standard Baking, Inc. (c) (l)
 
Food & Beverage
 
L+6.50% (8.50%), 7/25/2022
 
3,049

 
2,273

 
1,220

 
0.1
%
Green Energy Partners/Stonewall, LLC (c) (j)
 
Energy
 
L+5.50% (7.44%), 11/15/2021
 
1,000

 
998

 
922

 
0.1
%
Green Energy Partners/Stonewall, LLC (j)
 
Energy
 
L+5.50% (7.44%), 11/15/2021
 
1,324

 
1,322

 
1,221

 
0.1
%
HC2 Holdings, Inc. (c)
 
Industrials
 
11.50%, 12/1/2021
 
10,796

 
10,706

 
10,353

 
0.7
%
HireRight, Inc. (i)
 
Business Services
 
L+3.75% (5.55%), 7/11/2025
 
2,955

 
2,933

 
2,927

 
0.2
%
ICR Operations, LLC (c)
 
Business Services
 
L+5.00% (6.94%), 3/26/2024
 
98

 
96

 
98

 
0.0
%
ICR Operations, LLC (c) (i)
 
Business Services
 
L+5.00% (6.94%), 3/26/2025
 
17,321

 
17,055

 
17,321

 
1.2
%
Ideal Tridon Holdings, Inc. (c)
 
Industrials
 
L+5.75% (7.68%), 7/31/2024
 
46

 
46

 
45

 
0.0
%
Ideal Tridon Holdings, Inc. (c)
 
Industrials
 
L+5.75% (7.54%), 7/31/2023
 
161

 
161

 
158

 
0.0
%
Ideal Tridon Holdings, Inc. (c) (i)
 
Industrials
 
L+5.75% (7.70%), 7/31/2024
 
837

 
822

 
822

 
0.1
%
Ideal Tridon Holdings, Inc. (c) (i)
 
Industrials
 
L+5.75% (7.68%), 7/31/2023
 
28,549

 
28,216

 
28,036

 
1.9
%
IDERA, Inc. (j)
 
Technology
 
L+4.50% (6.30%), 6/28/2024
 
2,095

 
2,089

 
2,099

 
0.1
%
Integral Ad Science, Inc. (c) (l)
 
Software/Services
 
L+7.25% (9.05%), 7/19/2024
 
15,302

 
15,070

 
15,302

 
1.1
%
Integrated Efficiency Solutions, Inc. (c)
 
Industrials
 
L+10.25% (12.19%), 6/30/2022
 
3,658

 
3,658

 
3,344

 
0.2
%
Intelsat Jackson Holdings, SA (a) (j)
 
Telecom
 
L+4.50% (6.43%), 1/2/2024
 
10,000

 
10,178

 
10,070

 
0.7
%
Internap Corp. (c) (i) (l)
 
Business Services
 
L+7.00% (8.79%), 4/6/2022
 
11,789

 
11,779

 
7,533

 
0.5
%
International Cruise & Excursions, Inc. (c) (i)
 
Business Services
 
L+5.25% (7.05%), 6/6/2025
 
5,001

 
4,958

 
5,002

 
0.3
%
IPC Corp. (c) (j)
 
Software/Services
 
L+4.50% (6.43%), 8/6/2021
 
3,784

 
3,757

 
3,126

 
0.2
%
Iri Holdings, Inc. (c) (j)
 
Business Services
 
L+4.50% (6.30%), 12/1/2025
 
4,950

 
4,908

 
4,826

 
0.3
%
K2 Intelligence Holdings, Inc. (c) (i)
 
Business Services
 
L+4.75% (6.69%), 9/23/2024
 
11,667

 
11,446

 
11,445

 
0.8
%
Kahala Ireland OpCo Designated Activity Company (a) (c) (l) (o)
 
Transportation
 
L+8.00% (13.00%), 12/22/2028
 
105,549

 
105,549

 
105,549

 
7.2
%
Kaman Distribution Corp. (c) (i)
 
Industrials
 
L+5.00% (6.94%), 8/26/2026
 
21,498

 
19,650

 
20,853

 
1.4
%
Kissner Milling Co., Ltd. (a)
 
Industrials
 
8.38%, 12/1/2022
 
11,294

 
11,514

 
11,802

 
0.8
%
Lakeland Tours, LLC (i) (j)
 
Education
 
L+4.25% (6.15%), 12/16/2024
 
10,210

 
10,148

 
10,171

 
0.7
%
Lakeview Health Holdings, Inc. (c) (l) (t)
 
Healthcare
 
9.75%, 12/15/2021
 
129

 
124

 
54

 
0.0
%

The accompanying notes are an integral part of these consolidated financial statements.
23
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Lakeview Health Holdings, Inc. (c) (l) (t)
 
Healthcare
 
9.75%, 12/15/2021
 
$
3,756

 
$
2,671

 
$
1,582

 
0.1
%
LightSquared, LP (l)
 
Telecom
 
L+8.75% (10.85%), 12/7/2020
 
12,376

 
11,812

 
7,921

 
0.5
%
Lionbridge Technologies, Inc. (c) (i)
 
Business Services
 
L+6.25% (8.04%), 12/20/2025
 
10,344

 
10,241

 
10,241

 
0.7
%
MCS Acquisition Corp. (c)
 
Business Services
 
L+4.75% (6.64%), 5/20/2024
 
14,009

 
13,971

 
6,024

 
0.4
%
MED Parentco, LP (j)
 
Healthcare
 
L+4.25% (6.05%), 8/31/2026
 
306

 
306

 
305

 
0.0
%
MED Parentco, LP (j)
 
Healthcare
 
L+4.25% (6.05%), 8/31/2026
 
5,745

 
5,690

 
5,736

 
0.4
%
Medallion Midland Acquisition, LP (j)
 
Energy
 
L+3.25% (5.05%), 10/30/2024
 
4,361

 
4,353

 
4,306

 
0.3
%
Medical Depot Holdings, Inc. (c) (i) (l)
 
Healthcare
 
L+7.50% (9.44%), 1/3/2023
 
18,850

 
17,981

 
14,175

 
1.0
%
MGTF Radio Company, LLC (c) (o)
 
Media/Entertainment
 
L+6.00% (7.80%), 4/1/2024
 
57,974

 
57,831

 
54,171

 
3.7
%
Micross Solutions, LLC (c)
 
Software/Services
 
L+5.00% (6.72%), 8/7/2023
 
3,065

 
2,955

 
3,065

 
0.2
%
Midwest Can Company, LLC (c) (i)
 
Paper & Packaging
 
L+5.00% (6.81%), 4/11/2024
 
4,622

 
4,589

 
4,622

 
0.3
%
Miller Environmental Group, Inc. (c) (i)
 
Business Services
 
P+5.50% (10.25%), 3/15/2024
 
10,589

 
10,378

 
10,377

 
0.7
%
Miller Environmental Group, Inc. (c) (i)
 
Business Services
 
L+6.50% (8.63%), 3/15/2024
 
11,579

 
11,385

 
11,371

 
0.8
%
MLN US Holdco, LLC (a) (j)
 
Technology
 
L+4.50% (6.19%), 11/28/2025
 
10,675

 
10,645

 
10,061

 
0.7
%
Monitronics International, Inc. (c)
 
Business Services
 
L+6.50% (8.30%), 3/29/2024
 
7,575

 
7,589

 
6,541

 
0.5
%
Montreign Operating Company, LLC (c)
 
Gaming/Lodging
 
L+8.25% (10.16%), 1/24/2023
 
26,681

 
26,425

 
23,559

 
1.6
%
Mood Media Corp. (c)
 
Media/Entertainment
 
L+7.25% (9.19%), 6/28/2022
 
704

 
691

 
662

 
0.0
%
Mood Media Corp. (c) (i)
 
Media/Entertainment
 
L+7.25% (9.19%), 6/28/2022
 
13,168

 
13,025

 
12,378

 
0.9
%
Murray Energy Holdings, Co. (c)
 
Industrials
 
L+11.00% (13.00%), 7/31/2020
 
1,671

 
1,631

 
1,667

 
0.1
%
Murray Energy Holdings, Co. (j) (t)
 
Industrials
 
L+7.25% (9.19%), 10/17/2022
 
9,184

 
9,071

 
1,870

 
0.1
%
Muth Mirror Systems, LLC (c) (i)
 
Technology
 
L+5.25% (7.39%), 4/23/2025
 
15,778

 
15,498

 
15,509

 
1.1
%
National Technical Systems, Inc. (c) (i)
 
Business Services
 
L+6.25% (7.94%), 6/14/2021
 
17,469

 
17,422

 
16,770

 
1.1
%
Navitas Midstream Midland Basin, LLC (c) (j)
 
Energy
 
L+4.50% (6.30%), 12/13/2024
 
13,326

 
13,305

 
12,977

 
0.9
%
New Amsterdam Software Bidco, LLC (c) (i)
 
Technology
 
L+5.00% (6.80%), 5/1/2026
 
6,134

 
6,023

 
6,023

 
0.4
%
New Star Metals, Inc. (c) (i)
 
Industrials
 
L+6.00% (7.95%), 6/29/2023
 
22,692

 
22,284

 
22,692

 
1.6
%
NexSteppe, Inc. (c) (l) (o) (t)
 
Chemicals
 
12.00%, 3/31/2020
 
15,285

 
10,453

 
—

 
—
%
NexSteppe, Inc. (c) (l) (o) (t)
 
Chemicals
 
12.00%, 3/31/2020
 
2,269

 
1,750

 
—

 
—
%
NN, Inc. (a) (j)
 
Industrials
 
L+5.25% (7.05%), 10/19/2022
 
9,889

 
9,394

 
9,691

 
0.7
%
Norvax, LLC (c)
 
Business Services
 
L+6.50% (8.41%), 9/12/2025
 
11,489

 
11,212

 
11,214

 
0.8
%

The accompanying notes are an integral part of these consolidated financial statements.
24
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
NTM Acquisition Corp. (c) (i)
 
Media/Entertainment
 
L+6.25% (8.05%), 6/7/2022
 
$
22,999

 
$
22,861

 
$
22,999

 
1.6
%
Office Depot, Inc. (a) (j)
 
Retail
 
L+5.25% (7.04%), 11/8/2022
 
4,947

 
4,889

 
4,984

 
0.3
%
ORG Chemical Holdings, LLC (c) (g) (l)
 
Chemicals
 
L+7.75% (9.70%), 6/30/2022
 
3,420

 
3,420

 
3,420

 
0.2
%
ORG Chemical Holdings, LLC (c) (i) (l)
 
Chemicals
 
L+7.75% (9.70%), 6/30/2022
 
3,730

 
3,695

 
3,730

 
0.3
%
ORG GC Holdings, LLC (c) (i)
 
Business Services
 
L+6.75% (8.70%), 7/31/2022
 
21,624

 
21,457

 
20,932

 
1.4
%
PeopLease Holdings, LLC (c) (i)
 
Business Services
 
L+9.62% (11.57%), 2/26/2021
 
20,000

 
19,953

 
19,800

 
1.4
%
PGX Holdings, Inc. (c) (j)
 
Consumer
 
L+5.25% (7.05%), 9/29/2020
 
11,820

 
11,807

 
8,416

 
0.6
%
Planet Equity Group, LLC (c) (i)
 
Business Services
 
L+5.25% (7.18%), 11/18/2025
 
14,941

 
14,721

 
14,717

 
1.0
%
PlayPower, Inc. (c) (i)
 
Industrials
 
L+5.50% (7.46%), 5/8/2026
 
26,385

 
26,025

 
26,385

 
1.8
%
Premier Dental Services, Inc. (i) (j)
 
Healthcare
 
L+5.25% (7.05%), 6/30/2023
 
32,354

 
32,196

 
32,313

 
2.2
%
Premier Global Services, Inc. (c) (j)
 
Telecom
 
L+6.50% (8.40%), 6/8/2023
 
8,578

 
8,382

 
5,284

 
0.4
%
PSKW, LLC (c)
 
Healthcare
 
L+7.68% (9.63%), 11/26/2021
 
17,750

 
17,637

 
17,750

 
1.2
%
PSKW, LLC (c)
 
Healthcare
 
L+7.68% (9.63%), 11/25/2021
 
1,972

 
1,954

 
1,972

 
0.1
%
PSKW, LLC (c)
 
Healthcare
 
L+7.68% (9.63%), 11/25/2021
 
1,930

 
1,919

 
1,930

 
0.1
%
PSKW, LLC (c) (i)
 
Healthcare
 
L+4.25% (6.19%), 11/26/2021
 
1,162

 
1,159

 
1,162

 
0.1
%
PT Network, LLC (c) (i) (l)
 
Healthcare
 
L+7.50% (9.44%), 11/30/2023
 
16,780

 
16,702

 
15,052

 
1.0
%
Questex, Inc. (c)
 
Media/Entertainment
 
L+5.00% (6.91%), 9/9/2024
 
689

 
689

 
689

 
0.0
%
Questex, Inc. (c) (i)
 
Media/Entertainment
 
L+5.00% (6.89%), 9/9/2024
 
15,989

 
15,739

 
15,989

 
1.1
%
Red River Technology, LLC (c) (i)
 
Business Services
 
L+5.00% (6.94%), 8/30/2024
 
23,669

 
23,340

 
23,337

 
1.6
%
Reddy Ice Corp. (c) (i)
 
Food & Beverage
 
L+5.50% (7.60%), 7/1/2025
 
19,540

 
19,003

 
19,003

 
1.3
%
Regionalcare Hospital Partners Holdings, Inc. (j)
 
Healthcare
 
L+4.50% (6.30%), 11/14/2025
 
19,850

 
19,521

 
19,994

 
1.4
%
Resco Products, Inc. (c)
 
Industrials
 
L+6.25% (8.05%), 3/7/2020
 
10,000

 
10,000

 
9,200

 
0.6
%
Safety Products/JHC Acquisition Corp. (c) (j)
 
Industrials
 
L+4.50% (6.30%), 6/28/2026
 
958

 
958

 
937

 
0.1
%
Safety Products/JHC Acquisition Corp. (c) (j)
 
Industrials
 
L+4.50% (6.30%), 6/28/2026
 
17,717

 
17,564

 
17,341

 
1.2
%
Schenectady International Group, Inc. (j)
 
Chemicals
 
L+4.75% (6.79%), 10/15/2025
 
19,593

 
19,164

 
19,446

 
1.3
%
SFR Group, SA (a) (i)
 
Telecom
 
L+3.69% (5.43%), 2/2/2026
 
14,962

 
14,926

 
14,962

 
1.0
%
SFR Group, SA (a) (i) (j)
 
Telecom
 
L+4.00% (5.74%), 8/14/2026
 
12,967

 
12,862

 
12,978

 
0.9
%
Shields Health Solutions Holdings, LLC (c) (i)
 
Healthcare
 
L+5.00% (6.80%), 8/19/2026
 
6,963

 
6,896

 
6,897

 
0.5
%
SitusAMC Holdings Corp. (c) (i)
 
Financials
 
L+4.75% (6.55%), 6/30/2025
 
8,486

 
8,369

 
8,371

 
0.6
%

The accompanying notes are an integral part of these consolidated financial statements.
25
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Skillsoft Corp. (j)
 
Technology
 
L+4.75% (6.95%), 4/28/2021
 
$
15,001

 
$
14,378

 
$
11,469

 
0.8
%
Squan Holding Corp. (c) (l)
 
Telecom
 
L+7.00% (8.95%), 6/30/2020
 
16,276

 
16,123

 
13,835

 
1.0
%
SSH Group Holdings, Inc. (j)
 
Education
 
L+4.25% (6.19%), 7/30/2025
 
10,736

 
10,704

 
10,776

 
0.7
%
Subsea Global Solutions, LLC (c)
 
Business Services
 
L+7.00% (9.06%), 3/29/2023
 
388

 
388

 
381

 
0.0
%
Subsea Global Solutions, LLC (c) (i)
 
Business Services
 
L+7.00% (9.00%), 3/29/2023
 
2,392

 
2,302

 
2,344

 
0.2
%
Subsea Global Solutions, LLC (c) (i)
 
Business Services
 
L+7.00% (9.00%), 3/29/2023
 
8,327

 
8,219

 
8,168

 
0.6
%
Tax Defense Network, LLC (c) (l) (p) (t)
 
Consumer
 
L+6.00% (10.00%), 4/30/2020
 
5,257

 
3,833

 
1,262

 
0.1
%
Tax Defense Network, LLC (c) (l) (p) (t)
 
Consumer
 
L+6.00% (10.00%), 4/30/2020
 
29,616

 
21,646

 
7,108

 
0.5
%
Tax Defense Network, LLC (c) (l) (p) (t)
 
Consumer
 
L+10.00% (10.00%), 4/30/2020
 
2,357

 
2,357

 
2,357

 
0.2
%
The Dun & Bradstreet Corp. (j)
 
Business Services
 
L+5.00% (6.79%), 2/6/2026
 
10,000

 
9,825

 
10,079

 
0.7
%
TIBCO Software, Inc. (j)
 
Technology
 
L+4.00% (5.71%), 6/30/2026
 
4,988

 
4,988

 
5,005

 
0.3
%
Tillamook Country Smoker, LLC (c)
 
Food & Beverage
 
L+5.75% (7.85%), 5/19/2022
 
1,078

 
1,078

 
1,054

 
0.1
%
Tillamook Country Smoker, LLC (c) (i)
 
Food & Beverage
 
L+5.75% (7.65%), 5/19/2022
 
10,090

 
10,018

 
9,858

 
0.7
%
Tivity Health, Inc. (a) (j)
 
Healthcare
 
L+5.25% (7.05%), 3/6/2026
 
4,396

 
4,299

 
4,396

 
0.3
%
Tivity Health, Inc. (a) (j)
 
Healthcare
 
L+4.25% (6.05%), 3/8/2024
 
1,641

 
1,627

 
1,641

 
0.1
%
Trademark Global, LLC (c)
 
Consumer
 
L+6.00% (7.80%), 4/28/2023
 
2,067

 
2,067

 
2,067

 
0.1
%
Traverse Midstream Partners, LLC (j)
 
Energy
 
L+4.00% (5.80%), 9/27/2024
 
16,222

 
15,847

 
14,568

 
1.0
%
Trilogy International Partners, LLC (a)
 
Telecom
 
8.88%, 5/1/2022
 
14,875

 
14,837

 
13,983

 
1.0
%
University of St. Augustine Acquisition Corp. (c) (i)
 
Education
 
L+4.25% (6.05%), 2/2/2026
 
24,004

 
23,482

 
23,524

 
1.6
%
Veritext Corp. (i)
 
Business Services
 
L+3.75% (5.69%), 8/1/2025
 
4,975

 
4,975

 
4,955

 
0.3
%
Vertex Aerospace Services Corp. (i)
 
Industrials
 
L+4.50% (6.30%), 6/30/2025
 
8,726

 
8,692

 
8,753

 
0.6
%
Von Drehle Corp. (c) (i) (l)
 
Paper & Packaging
 
L+11.50% (13.44%), 3/6/2023
 
26,856

 
26,595

 
25,164

 
1.7
%
Vyaire Medical, Inc. (c) (j)
 
Healthcare
 
L+4.75% (6.84%), 4/16/2025
 
8,850

 
8,580

 
7,611

 
0.5
%
WaterBridge Midstream Operating, LLC (j)
 
Energy
 
L+5.75% (7.83%), 6/22/2026
 
11,834

 
11,572

 
11,613

 
0.8
%
WMK, LLC (c)
 
Business Services
 
L+5.75% (7.49%), 9/5/2025
 
1,910

 
1,903

 
1,910

 
0.1
%
WMK, LLC (c)
 
Business Services
 
L+5.75% (7.44%), 9/5/2024
 
1,134

 
1,134

 
1,134

 
0.1
%
WMK, LLC (c) (i)
 
Business Services
 
L+5.75% (7.49%), 9/5/2025
 
20,180

 
19,853

 
20,180

 
1.4
%
Xplornet Communications, Inc. (a) (i) (j)
 
Telecom
 
L+4.00% (5.94%), 9/9/2021
 
15,679

 
15,645

 
15,699

 
1.1
%

The accompanying notes are an integral part of these consolidated financial statements.
26
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
YummyEarth, Inc. (c)
 
Food & Beverage
 
L+7.00% (8.91%), 8/1/2025
 
$
2,626

 
$
2,625

 
$
2,626

 
0.2
%
Subtotal Senior Secured First Lien Debt
 
 
 
 
 
$
1,862,228

 
$
1,764,292

 
120.6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior Secured Second Lien Debt - 21.0% (b)
 
 
 
 
 
 
 
 
 
 
Accentcare, Inc. (c) (i)
 
Healthcare
 
L+8.75% (10.70%), 6/21/2027
 
$
17,795

 
$
17,380

 
$
17,366

 
1.2
%
Anchor Glass Container Corp. (c)
 
Paper & Packaging
 
L+7.75% (9.46%), 12/6/2024
 
20,000

 
19,845

 
10,400

 
0.7
%
Astro AB Merger Sub, Inc. (a) (i)
 
Financials
 
L+7.50% (9.43%), 4/28/2023
 
7,758

 
7,758

 
7,719

 
0.5
%
Asurion Corp. (i) (j)
 
Business Services
 
L+6.50% (8.30%), 8/4/2025
 
18,734

 
18,866

 
18,949

 
1.3
%
Avatar Purchaser, Inc. (c) (j)
 
Software/Services
 
L+7.50% (9.49%), 11/17/2025
 
11,716

 
11,458

 
11,716

 
0.8
%
Aveanna Healthcare, LLC (c)
 
Healthcare
 
L+8.00% (9.80%), 3/17/2025
 
15,000

 
14,852

 
13,650

 
0.9
%
Baker Hill Acquisition, LLC (c)
 
Financials
 
L+11.00% (13.09%), 3/22/2021
 
3,017

 
1,508

 
1,584

 
0.1
%
Baker Hill Acquisition, LLC (c)
 
Financials
 
L+11.00% (13.09%), 3/22/2021
 
447

 
416

 
447

 
0.0
%
Boston Market Corp. (c)
 
Food & Beverage
 
L+4.50% (6.51%), 1/9/2021
 
3,691

 
3,691

 
3,691

 
0.3
%
Boston Market Corp. (c)
 
Food & Beverage
 
L+8.25% (10.19%), 1/18/2021
 
26,259

 
24,260

 
8,534

 
0.6
%
Boston Market Corp. (c)
 
Food & Beverage
 
L+4.50% (6.59%), 1/9/2021
 
923

 
923

 
923

 
0.1
%
BrandMuscle Holdings, Inc. (c)
 
Business Services
 
L+8.50% (10.60%), 6/1/2022
 
24,500

 
24,317

 
24,500

 
1.7
%
Carlisle FoodService Products, Inc. (c) (i)
 
Consumer
 
L+7.75% (9.55%), 3/20/2026
 
10,719

 
10,552

 
10,719

 
0.7
%
CDS U.S. Intermediate Holdings, Inc. (a) (c)
 
Media/Entertainment
 
L+8.25% (10.19%), 7/10/2023
 
9,177

 
8,946

 
7,846

 
0.5
%
Constellis Holdings, LLC (c) (t)
 
Business Services
 
L+9.00% (10.93%), 4/21/2025
 
1,117

 
1,117

 
56

 
0.0
%
Dentalcorp Perfect Smile, ULC (a) (c)
 
Healthcare
 
L+7.50% (9.30%), 6/8/2026
 
10,139

 
10,056

 
10,139

 
0.7
%
Dimora Brands, Inc. (c)
 
Consumer
 
L+8.50% (10.30%), 8/25/2025
 
4,464

 
4,463

 
4,464

 
0.3
%
Edelman Financial Services, LLC (a) (j)
 
Financials
 
L+6.75% (8.54%), 7/20/2026
 
6,764

 
6,736

 
6,730

 
0.5
%
Hyland Software, Inc. (c) (i)
 
Technology
 
L+7.00% (8.80%), 7/7/2025
 
6,904

 
6,930

 
6,904

 
0.5
%
ICP Industrial, Inc. (c)
 
Chemicals
 
L+8.25% (10.04%), 5/3/2024
 
5,588

 
5,587

 
5,588

 
0.4
%
KidKraft, Inc. (c) (l)
 
Consumer
 
12.00%, 3/31/2022
 
6,373

 
6,316

 
5,149

 
0.4
%
MLN US Holdco, LLC (a) (c) (i)
 
Technology
 
L+8.75% (10.44%), 11/30/2026
 
3,000

 
2,948

 
2,452

 
0.2
%
Northstar Financial Services Group, LLC (c)
 
Financials
 
L+7.50% (9.30%), 5/25/2026
 
2,666

 
2,656

 
2,666

 
0.2
%
PetVet Care Centers, LLC (c)
 
Healthcare
 
L+6.25% (8.05%), 2/13/2026
 
3,539

 
3,525

 
3,539

 
0.2
%
PI US Holdco III, Ltd. (a) (c)
 
Financials
 
L+7.25% (9.05%), 12/22/2025
 
6,696

 
6,645

 
6,562

 
0.5
%
ProAmpac, LLC (c)
 
Paper & Packaging
 
L+8.50% (10.40%), 11/18/2024
 
3,352

 
3,351

 
3,352

 
0.2
%

The accompanying notes are an integral part of these consolidated financial statements.
27
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Project Boost Purchaser, LLC
 
Business Services
 
L+8.00% (9.80%), 5/31/2027
 
$
1,848

 
$
1,848

 
$
1,848

 
0.1
%
QuickBase, Inc. (c)
 
Technology
 
L+8.00% (9.71%), 4/2/2027
 
7,484

 
7,348

 
7,349

 
0.5
%
Recess Holdings, Inc. (c) (i)
 
Industrials
 
L+7.75% (9.55%), 9/29/2025
 
15,008

 
14,841

 
15,008

 
1.0
%
Renaissance Holding Corp. (c)
 
Software/Services
 
L+7.00% (8.80%), 5/29/2026
 
8,456

 
8,320

 
8,123

 
0.6
%
River Cree Enterprises, LP (a) (c) (m)
 
Gaming/Lodging
 
10.00%, 5/17/2025
 
CAD
21,275

 
16,427

 
16,378

 
1.1
%
SCA Pharmaceuticals, LLC (c)
 
Healthcare
 
L+9.00% (10.94%), 12/16/2020
 
2,235

 
2,194

 
2,056

 
0.1
%
SSH Group Holdings, Inc. (c) (i)
 
Education
 
L+8.25% (10.19%), 7/30/2026
 
10,122

 
10,039

 
10,122

 
0.7
%
St. Croix Hospice Acquisition Corp. (c)
 
Healthcare
 
L+8.75% (10.55%), 3/29/2024
 
2,056

 
1,983

 
2,056

 
0.1
%
TierPoint, LLC (c)
 
Business Services
 
L+7.25% (9.05%), 5/5/2025
 
5,334

 
5,298

 
5,014

 
0.3
%
Travelpro Products, Inc. (a) (c) (l)
 
Consumer
 
13.00%, 11/1/2022
 
2,405

 
2,404

 
2,405

 
0.2
%
Travelpro Products, Inc. (a) (c) (l) (m)
 
Consumer
 
13.00%, 11/21/2022
 
CAD
2,786

 
2,137

 
2,145

 
0.1
%
US Salt, LLC (c) (i)
 
Industrials
 
L+8.63% (10.42%), 1/18/2027
 
26,968

 
26,197

 
26,968

 
1.9
%
Vantage Mobility International, LLC (c) (l) (p) (t)
 
Transportation
 
L+6.00% (7.80%), 6/30/2023
 
2,883

 
2,743

 
2,883

 
0.2
%
Vital Proteins, LLC (c) (l)
 
Consumer
 
12.00%, 5/16/2022
 
8,628

 
8,485

 
8,478

 
0.6
%
Subtotal Senior Secured Second Lien Debt
 
 
 
 
 
$
335,366

 
$
306,478

 
21.0
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Subordinated Debt - 7.4% (b)
 
 
 
 
 
 
 
 
 
 
AHP Health Partners, Inc.
 
Healthcare
 
9.75%, 7/15/2026
 
$
6,589

 
$
6,511

 
$
7,257

 
0.5
%
Captek Softgel International, Inc. (c) (l) (t)
 
Health/Fitness
 
11.50%, 1/30/2023
 
7,099

 
7,071

 
5,324

 
0.4
%
Community Intervention Services, Inc. (c) (l) (t)
 
Healthcare
 
13.00%, 1/29/2021
 
6,074

 
—

 
—

 
—
%
Del Real, LLC (c)
 
Food & Beverage
 
11.00%, 4/1/2023
 
3,129

 
2,998

 
2,641

 
0.2
%
Dyno Acquiror, Inc. (c) (l)
 
Consumer
 
12.00%, 8/1/2020
 
1,074

 
1,074

 
1,074

 
0.1
%
HemaSource, Inc. (c) (x)
 
Healthcare
 
11.00%, 1/1/2024
 
2,235

 
2,152

 
2,156

 
0.1
%
HTC Borrower, LLC (c) (l)
 
Consumer
 
13.00%, 9/1/2020
 
5,410

 
5,326

 
5,410

 
0.4
%
Iridium Communications, Inc.
 
Telecom
 
10.25%, 4/15/2023
 
3,536

 
3,536

 
3,794

 
0.3
%
Park Ave RE Holdings, LLC (c) (l) (o) (w)
 
Financials
 
13.00%, 12/31/2021
 
37,237

 
37,237

 
37,237

 
2.5
%
PCX Aerostructures, LLC (c) (l) (p)
 
Industrials
 
6.00%, 8/9/2021
 
7,878

 
6,065

 
5,908

 
0.4
%
RMP Group, Inc. (c) (l)
 
Financials
 
11.50%, 9/1/2022
 
2,299

 
2,240

 
2,300

 
0.2
%
Siena Capital Finance, LLC (c) (o)
 
Financials
 
12.50%, 8/16/2021
 
22,500

 
22,492

 
22,500

 
1.5
%
Xplornet Communications, Inc. (a) (c)
 
Telecom
 
9.63%, 6/1/2022
 
12,304

 
12,304

 
12,550

 
0.8
%
Subtotal Subordinated Debt
 
 
 
 
 
$
109,006

 
$
108,151

 
7.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Collateralized Securities - 7.4% (b)
 
 
 
 
 
 
 
 
 
 
Collateralized Securities - Debt Investments
 
 
 
 
 
 
 
 
 
 
Anchorage Credit Opportunities CLO, LLC 19-1A D (a) (c)
 
Diversified Investment Vehicles
 
L+5.10% (7.01%), 1/20/2032
 
$
3,000

 
$
2,885

 
$
2,885

 
0.2
%
Avery Point CLO, Ltd. 15-6A E1 (a) (c)
 
Diversified Investment Vehicles
 
L+5.50% (7.39%), 8/6/2027
 
3,500

 
3,156

 
3,156

 
0.2
%

The accompanying notes are an integral part of these consolidated financial statements.
28
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Babson CLO, Ltd. 19-4A E (a) (c)
 
Diversified Investment Vehicles
 
L+7.39% (9.29%), 1/15/2033
 
$
1,500

 
$
1,395

 
$
1,395

 
0.1
%
Crown Point CLO, Ltd. 2019-8A E (a) (c)
 
Diversified Investment Vehicles
 
L+7.10% (9.12%), 10/20/2032
 
6,000

 
5,708

 
5,853

 
0.4
%
Dryden Senior Loan Fund 17-49A E (a) (c)
 
Diversified Investment Vehicles
 
L+6.30% (8.30%), 7/18/2030
 
3,000

 
2,890

 
2,890

 
0.2
%
Dryden Senior Loan Fund 2014-36A ER2 (a) (c)
 
Diversified Investment Vehicles
 
L+6.88% (8.87%), 4/15/2029
 
2,000

 
1,947

 
1,975

 
0.1
%
KKR Financial CLO, Ltd. 27A E (a) (c)
 
Diversified Investment Vehicles
 
L+6.90% (8.82%), 10/15/2032
 
1,250

 
1,189

 
1,211

 
0.1
%
LCM, Ltd. Partnership 16A ER2 (a) (c)
 
Diversified Investment Vehicles
 
L+6.38% (8.38%), 10/15/2031
 
2,500

 
2,307

 
2,307

 
0.2
%
Madison Park Funding, Ltd. 16-21A DR (a) (c)
 
Diversified Investment Vehicles
 
L+7.56% (9.39%), 10/15/2032
 
2,000

 
1,881

 
1,881

 
0.1
%
Madison Park Funding, Ltd. 19-35A E (a) (c)
 
Diversified Investment Vehicles
 
L+6.75% (8.72%), 4/20/2031
 
2,000

 
1,945

 
1,945

 
0.1
%
NewStar Arlington Senior Loan Program, LLC 14-1A FR (a) (c) (p)
 
Diversified Investment Vehicles
 
L+11.00% (12.94%), 4/25/2031
 
4,750

 
4,550

 
4,612

 
0.3
%
Newstar Fairfield Fund CLO, Ltd. 2015-1RA F (a) (c) (p)
 
Diversified Investment Vehicles
 
L+7.50% (9.47%), 1/20/2027
 
10,728

 
9,586

 
9,209

 
0.6
%
OCP CLO, Ltd. 14-5A DR (a) (c)
 
Diversified Investment Vehicles
 
L+5.70% (7.64%), 4/26/2031
 
2,200

 
2,060

 
2,060

 
0.1
%
OCP CLO, Ltd. 2019-17A E (a) (c)
 
Diversified Investment Vehicles
 
L+6.66% (8.79%), 7/20/2032
 
3,000

 
2,913

 
2,946

 
0.2
%
Pikes Peak CLO 19-3A E (a) (c)
 
Diversified Investment Vehicles
 
L+6.86% (8.80%), 4/25/2030
 
3,000

 
2,849

 
2,849

 
0.2
%
Sound Point CLO, Ltd. 19-3A E (a) (c)
 
Diversified Investment Vehicles
 
L+7.31% (9.41%), 10/25/2032
 
3,000

 
2,912

 
2,972

 
0.2
%
Sound Point CLO, Ltd. 2015-3A ER (a) (c)
 
Diversified Investment Vehicles
 
L+5.25% (7.22%), 1/20/2028
 
2,000

 
1,881

 
1,915

 
0.1
%
Symphony CLO, Ltd. 2012-9A ER2 (a) (c)
 
Diversified Investment Vehicles
 
L+6.95% (8.95%), 7/16/2032
 
3,000

 
2,942

 
2,972

 
0.2
%
TCW CLO 2019-1 AMR, Ltd. 19-1A F (a) (c)
 
Diversified Investment Vehicles
 
L+8.67% (10.58%), 2/15/2029
 
2,500

 
2,396

 
2,396

 
0.2
%
Vibrant CLO, Ltd. 2016-4A DR (a) (c)
 
Diversified Investment Vehicles
 
L+4.33% (6.30%), 7/20/2032
 
3,000

 
2,913

 
2,947

 
0.2
%
Whitehorse, Ltd. 2014-1A E (a) (c) (p)
 
Diversified Investment Vehicles
 
L+4.55% (6.46%), 5/1/2026
 
8,000

 
7,717

 
7,054

 
0.5
%
Zais CLO 13, Ltd. 19-13A D1 (a) (c)
 
Diversified Investment Vehicles
 
L+4.52% (6.60%), 7/15/2032
 
3,000

 
2,854

 
2,908

 
0.2
%
Collateralized Securities - Equity Investments (n)
 
 
 
 
 
 
 
 
 
 
CVP Cascade CLO, Ltd. 2013-CLO1 Side Letter (a) (c)
 
Diversified Investment Vehicles
 
0.00%, 1/16/2026
 
$
3,243

 
$
106

 
$
24

 
0.0
%
CVP Cascade CLO, Ltd. 2014-2A Side Letter (a) (c)
 
Diversified Investment Vehicles
 
0.00%, 7/18/2026
 
3,755

 
463

 
38

 
0.0
%
Figueroa CLO, Ltd. 2014-1A Side Letter (a) (c)
 
Diversified Investment Vehicles
 
0.00%, 1/15/2027
 
2,986

 
597

 
67

 
0.0
%
MidOcean Credit CLO 2013-2A INC (a) (c) (p) (v)
 
Diversified Investment Vehicles
 
0.76%, 1/29/2025
 
37,600

 
16,815

 
11,835

 
0.8
%
NewStar Arlington Senior Loan Program, LLC 14-1A SUB (a) (c) (p) (v)
 
Diversified Investment Vehicles
 
16.56%, 7/25/2025
 
31,603

 
19,353

 
19,697

 
1.4
%
Newstar Fairfield Fund CLO, Ltd. 2015-1RA SUB (a) (c) (p) (v)
 
Diversified Investment Vehicles
 
21.81%, 1/20/2027
 
31,575

 
7,298

 
6,607

 
0.5
%
OFSI Fund, Ltd. 2014-6A Side Letter (a) (c)
 
Diversified Investment Vehicles
 
0.00%, 3/20/2025
 
1,970

 
263

 
—

 
—
%
Whitehorse, Ltd. 2014-1A Side Letter (a) (c) (p)
 
Diversified Investment Vehicles
 
10.44%, 5/1/2026
 
1,886

 
134

 
35

 
0.0
%

The accompanying notes are an integral part of these consolidated financial statements.
29
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Whitehorse, Ltd. 2014-1A SUB (a) (c) (p) (v)
 
Diversified Investment Vehicles
 
0.00%, 5/1/2026
 
$
36,000

 
$
6,965

 
$
286

 
0.0
%
Subtotal Collateralized Securities
 
 
 
 
 
$
122,870

 
$
108,927

 
7.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity/Other - 17.7% (b) (d)
 
 
 
 
 
 
 
 
 
 
Aden & Anais Holdings, Inc. (c) (e) (x)
 
Retail
 
 
 
4,470

 
$
—

 
$
—

 
—
%
Answers Corp. (c) (p)
 
Media/Entertainment
 
 
 
908,911

 
11,361

 
727

 
0.0
%
Avaya Holdings Corp. (a) (e) (s)
 
Technology
 
 
 
187,660

 
2,979

 
2,533

 
0.2
%
Baker Hill Acquisition, LLC (c) (e)
 
Financials
 
 
 
22,653

 
—

 
—

 
—
%
Boston Market Corp. (c) (e) (u)
 
Food & Beverage
 
 
 
160,327

 
—

 
—

 
—
%
Capstone Nutrition Development, LLC (c) (e) (p) (u)
 
Consumer
 
 
 
47,883

 
4,788

 
4,788

 
0.3
%
Captek Softgel International, Inc. (c) (e) (x)
 
Health/Fitness
 
 
 
8,498

 
942

 
—

 
—
%
CRD Holdings, LLC (a) (c) (o) (u)
 
Energy
 
9.00%
 
52,285,603

 
28,066

 
28,943

 
2.0
%
CRS-SPV, Inc. (c) (e) (o)
 
Industrials
 
 
 
246

 
2,219

 
2,221

 
0.2
%
Danish CRJ, Ltd. (a) (c) (e) (p) (r)
 
Transportation
 
 
 
5,002

 
—

 
—

 
—
%
Data Source Holdings, LLC (c) (e)
 
Business Services
 
 
 
10,617

 
140

 
93

 
0.0
%
Del Real, LLC (c) (e) (u)
 
Food & Beverage
 
 
 
670,510

 
382

 
—

 
—
%
Dyno Acquiror, Inc. (c) (e)
 
Consumer
 
 
 
134,102

 
58

 
80

 
0.0
%
HemaSource, Inc. (c) (e) (x)
 
Healthcare
 
 
 
223,503

 
168

 
101

 
0.0
%
ICP Industrial, Inc. (c) (e)
 
Chemicals
 
 
 
288

 
279

 
380

 
0.0
%
Integrated Efficiency Solutions, Inc. (c) (e)
 
Industrials
 
 
 
53,215

 
56

 
—

 
—
%
Integrated Efficiency Solutions, Inc. (c) (e)
 
Industrials
 
 
 
2,975

 
3

 
—

 
—
%
Kahala Ireland OpCo Designated Activity Company (a) (c) (e) (h) (o)
 
Transportation
 
 
 
1

 
—

 
57,226

 
3.9
%
Kahala Ireland OpCo Designated Activity Company (a) (c) (e) (h) (o)
 
Transportation
 
 
 
3,250,000

 
2,795

 
3,250

 
0.2
%
Kahala US OpCo, LLC (a) (c) (e) (k) (o)
 
Transportation
 
13.00%
 
4,413,472

 
—

 
—

 
—
%
K-Square Restaurant Partners, LP (c) (e) (x)
 
Food & Beverage
 
 
 
447

 
175

 
—

 
—
%
Lakeview Health Holdings, Inc. (c) (e)
 
Healthcare
 
 
 
447

 
—

 
—

 
—
%
MGTF Holdco, LLC (c) (e) (o) (u)
 
Media/Entertainment
 
 
 
330,000

 
—

 
—

 
—
%
MIC Holding, LLC (c) (e)
 
Consumer
 
 
 
30,000

 
3,750

 
3,822

 
0.3
%
MIC Holding, LLC (c) (e)
 
Consumer
 
 
 
1,470

 
3,687

 
4,520

 
0.3
%
Micross Solutions, LLC (c) (e)
 
Software/Services
 
 
 
442,430

 
223

 
1,040

 
0.1
%
Mood Media Corp. (c) (e)
 
Media/Entertainment
 
 
 
121,021

 
27

 
—

 
—
%
Motor Vehicle Software Corp. (c) (e) (x)
 
Business Services
 
 
 
223,503

 
318

 
268

 
0.0
%
NexSteppe, Inc. (c) (e) (o)
 
Chemicals
 
 
 
237,239,694

 
737

 
—

 
—
%
NMFC Senior Loan Program I, LLC (a) (o)
 
Diversified Investment Vehicles
 
 
 
50,000

 
50,000

 
47,310

 
3.2
%
Nomacorc, LLC (c) (e) (u)
 
Industrials
 
 
 
356,816

 
56

 
143

 
0.0
%
Park Ave RE Holdings, LLC (c) (e) (o) (w)
 
Financials
 
 
 
719

 
2,842

 
11,133

 
0.8
%
PCX Aerostructures, LLC (c) (e) (p)
 
Industrials
 
 
 
27,250

 
—

 
—

 
—
%

The accompanying notes are an integral part of these consolidated financial statements.
30
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
PCX Aerostructures, LLC (c) (e) (p)
 
Industrials
 
 
 
315

 
$
—

 
$
—

 
—
%
PCX Aerostructures, LLC (c) (e) (p)
 
Industrials
 
 
 
1,356

 
—

 
—

 
—
%
PennantPark Credit Opportunities Fund II, LP (a) (p)
 
Diversified Investment Vehicles
 
 
 
8,739

 
8,739

 
8,707

 
0.6
%
PT Network, LLC (c) (e) (u)
 
Healthcare
 
 
 
3

 
—

 
—

 
—
%
RMP Group, Inc. (c) (e) (u)
 
Financials
 
 
 
223

 
164

 
274

 
0.0
%
RockYou, Inc. (c) (e)
 
Media/Entertainment
 
 
 
15,105

 
—

 
—

 
—
%
Schweiger Dermatology Group, LLC (c) (e) (u)
 
Healthcare
 
 
 
265,024

 
—

 
—

 
—
%
Siena Capital Finance, LLC (c) (o)
 
Financials
 
 
 
35,839,400

 
36,537

 
36,915

 
2.5
%
Smile Brands, Inc. (c) (e)
 
Healthcare
 
 
 
712

 
815

 
1,101

 
0.1
%
Squan Holding Corp. (c) (e)
 
Telecom
 
 
 
180,835

 
—

 
—

 
—
%
Squan Holding Corp. (c) (e)
 
Telecom
 
 
 
8,962

 
—

 
—

 
—
%
St. Croix Hospice Acquisition Corp. (c) (e)
 
Healthcare
 
 
 
112

 
—

 
31

 
0.0
%
St. Croix Hospice Acquisition Corp. (c) (e)
 
Healthcare
 
 
 
112

 
64

 
134

 
0.0
%
SYNACOR, Inc. (e) (s)
 
Technology
 
 
 
59,785

 
—

 
91

 
0.0
%
Tap Rock Resources, LLC (c) (e) (g) (p) (u)
 
Energy
 
 
 
20,672,210

 
20,672

 
20,879

 
1.4
%
Tax Advisors Group, LLC (c) (e) (u)
 
Financials
 
 
 
86

 
609

 
755

 
0.1
%
Tax Defense Network, LLC (c) (e) (p)
 
Consumer
 
 
 
633,382

 
—

 
—

 
—
%
Tax Defense Network, LLC (c) (e) (p)
 
Consumer
 
 
 
147,099

 
425

 
—

 
—
%
Team Waste, LLC (c) (e) (p) (u)
 
Industrials
 
 
 
111,752

 
2,235

 
2,235

 
0.2
%
Tennenbaum Waterman Fund, LP (a) (p)
 
Diversified Investment Vehicles
 
 
 
10,000

 
10,000

 
9,841

 
0.7
%
THL Credit Greenway Fund II, LLC (a) (p)
 
Diversified Investment Vehicles
 
 
 
5,048

 
5,048

 
2,554

 
0.2
%
Travelpro Products, Inc. (a) (c) (e)
 
Consumer
 
 
 
447,007

 
506

 
581

 
0.0
%
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
39,769

 
132

 
21

 
0.0
%
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
99,236

 
—

 
—

 
—
%
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
3,155

 
—

 
—

 
—
%
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
223

 
35

 
9

 
0.0
%
United Biologics, LLC (c) (e) (u)
 
Healthcare
 
 
 
4,206

 
31

 
15

 
0.0
%
USASF Holdco, LLC (c) (e) (u)
 
Financials
 
 
 
10,000

 
10

 
—

 
—
%
USASF Holdco, LLC (c) (e) (u)
 
Financials
 
 
 
490

 
490

 
640

 
0.0
%
USASF Holdco, LLC (c) (e) (u)
 
Financials
 
 
 
139

 
139

 
278

 
0.0
%
Vantage Mobility International, LLC (c) (e) (p)
 
Transportation
 
 
 
1,468,221

 
—

 
—

 
—
%
Vantage Mobility International, LLC (c) (e) (p)
 
Transportation
 
 
 
391,131

 
—

 
—

 
—
%
Vantage Mobility International, LLC (c) (e) (p)
 
Transportation
 
 
 
3,139,625

 
3,140

 
942

 
0.1
%
Women's Marketing, Inc. (c) (e)
 
Media/Entertainment
 
 
 
3,643

 
—

 
—

 
—
%
World Business Lenders, LLC (c) (e)
 
Financials
 
 
 
922,669

 
3,750

 
3,755

 
0.3
%
WPNT, LLC (c) (e) (o) (u)
 
Media/Entertainment
 
 
 
330,000

 
—

 
—

 
—
%
WSO Holdings, LP (c) (e)
 
Food & Beverage
 
 
 
698

 
279

 
—

 
—
%

The accompanying notes are an integral part of these consolidated financial statements.
31
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
Portfolio Company (f) (q)
 
Industry
 
Investment Coupon Rate / Maturity (y)
 
Principal / Number of Shares
 
Amortized Cost
 
Fair Value
 
% of Net Assets (b)
Wythe Will Tzetzo, LLC (c) (e) (u)
 
Food & Beverage
 
 
 
22,312

 
$
301

 
$
—

 
—
%
YummyEarth, Inc. (c) (e)
 
Food & Beverage
 
 
 
223

 
—

 
—

 
—
%
Subtotal Equity/Other
 
 
 
 
 
$
210,172

 
$
258,336

 
17.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL INVESTMENTS - 174.1% (b)
 
 
 
 
 
$
2,639,642

 
$
2,546,184

 
174.1
%
Forward foreign currency contracts:
Counterparty
 
Contract to Deliver
 
In Exchange For
 
Maturity Date
 
Unrealized Depreciation
Goldman Sachs International
 
CAD 21,807
 
$
16,359

 
1/10/2020
 
$
(388
)
_________
(a)
All of the Company's investments, except the investments noted by this footnote, are qualifying assets under Section 55(a) of the Investment Company Act of 1940, as amended (the "1940 Act"). Under the 1940 Act, the Company may not acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of the Company's total assets. Qualifying assets represent 75.9% of the Company's total assets. The significant majority of all investments held are deemed to be illiquid.
(b)
Percentages are based on net assets as of December 31, 2019.
(c)
The fair value of investments with respect to securities for which market quotations are not readily available is determined in good faith by the Company's Board of Directors as required by the 1940 Act. Such investments are valued using significant unobservable inputs (See Note 3 to the consolidated financial statements).
(d)
All amounts are in thousands except share amounts.
(e)
Non-income producing at December 31, 2019.
(f)
The Company has various unfunded commitments to portfolio companies. Please refer to Note 7 - Commitments and Contingencies for details of these unfunded commitments.
(g)
The commitment related to this investment is discretionary.
(h)
The Company's investment is held through the consolidated subsidiaries, Kahala Aviation Holdings, LLC and Kahala LuxCo S.A.R.L, which own 100% of the equity of the operating company, Kahala Ireland OpCo Designated Activity Company.
(i)
The Company's investment or a portion thereof is pledged as collateral under the Wells Fargo Credit Facility. Individual investments can be divided into parts which are pledged to separate credit facilities.
(j)
The Company's investment or a portion thereof is pledged as collateral under the Citi Credit Facility. Individual investments can be divided into parts which are pledged to separate credit facilities.
(k)
The Company's investment is held through the consolidated subsidiaries, Kahala Aviation Holdings, LLC and Kahala Aviation US, Inc. which own 100% of the equity of the operating company, Kahala US OpCo LLC.

The accompanying notes are an integral part of these consolidated financial statements.
32
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)


(l)
For the year ended December 31, 2019, the following investments paid or have the option to pay all or a portion of interest and dividends via payment-in-kind (“PIK”):
December 31, 2019
Portfolio Company
 
Investment Type
 
Cash
 
PIK
 
All-in Rate
 
PIK earned for the year ended December 31, 2019
Gold Standard Baking, Inc.
 
Senior Secured First Lien Debt
 
6.50
%
 
2.00
%
 
8.50
%
 
$
81

Integral Ad Science, Inc.
 
Senior Secured First Lien Debt
 
7.80
%
 
1.25
%
 
9.05
%
 
182

Internap Corp.
 
Senior Secured First Lien Debt
 
8.04
%
 
0.75
%
 
8.79
%
 
56

Kahala Ireland OpCo Designated Activity Company
 
Senior Secured First Lien Debt
 
13.00
%
 
—
%
 
13.00
%
 
—

Lakeview Health Holdings, Inc.
 
Senior Secured First Lien Debt
 
—
%
 
9.75
%
 
9.75
%
 
—

Lakeview Health Holdings, Inc.
 
Senior Secured First Lien Debt
 
—
%
 
9.75
%
 
9.75
%
 
—

LightSquared, LP
 
Senior Secured First Lien Debt
 
—
%
 
10.85
%
 
10.85
%
 
1,478

Medical Depot Holdings, Inc.
 
Senior Secured First Lien Debt
 
7.44
%
 
2.00
%
 
9.44
%
 
93

NexSteppe, Inc.
 
Senior Secured First Lien Debt
 
—
%
 
12.00
%
 
12.00
%
 
—

NexSteppe, Inc.
 
Senior Secured First Lien Debt
 
—
%
 
12.00
%
 
12.00
%
 
—

ORG Chemical Holdings, LLC
 
Senior Secured First Lien Debt
 
9.70
%
 
—
%
 
9.70
%
 
14

ORG Chemical Holdings, LLC
 
Senior Secured First Lien Debt
 
9.70
%
 
—
%
 
9.70
%
 
269

PT Network, LLC
 
Senior Secured First Lien Debt
 
7.44
%
 
2.00
%
 
9.44
%
 
101

Squan Holding Corp.
 
Senior Secured First Lien Debt
 
7.95
%
 
1.00
%
 
8.95
%
 
169

Tax Defense Network, LLC
 
Senior Secured First Lien Debt
 
—
%
 
10.00
%
 
10.00
%
 
—

Tax Defense Network, LLC
 
Senior Secured First Lien Debt
 
4.47
%
 
5.53
%
 
10.00
%
 
—

Tax Defense Network, LLC
 
Senior Secured First Lien Debt
 
4.47
%
 
5.53
%
 
10.00
%
 
—

TwentyEighty, Inc.
 
Senior Secured First Lien Debt
 
4.00
%
 
4.00
%
 
8.00
%
 
201

TwentyEighty, Inc.
 
Senior Secured First Lien Debt
 
0.25
%
 
8.75
%
 
9.00
%
 
426

Von Drehle Corp.
 
Senior Secured First Lien Debt
 
9.44
%
 
4.00
%
 
13.44
%
 
1,068

KidKraft, Inc.
 
Senior Secured Second Lien Debt
 
11.00
%
 
1.00
%
 
12.00
%
 
63

Travelpro Products, Inc.
 
Senior Secured Second Lien Debt
 
11.00
%
 
2.00
%
 
13.00
%
 
48

Travelpro Products, Inc.
 
Senior Secured Second Lien Debt
 
11.00
%
 
2.00
%
 
13.00
%
 
42

Vantage Mobility International, LLC
 
Senior Secured Second Lien Debt
 
—
%
 
7.80
%
 
7.80
%
 
—

Vital Proteins, LLC
 
Senior Secured Second Lien Debt
 
7.50
%
 
4.50
%
 
12.00
%
 
168

Captek Softgel International, Inc.
 
Subordinated Debt
 
10.00
%
 
1.50
%
 
11.50
%
 
80

Community Intervention Services, Inc.
 
Subordinated Debt
 
—
%
 
13.00
%
 
13.00
%
 
—

Dyno Acquiror, Inc.
 
Subordinated Debt
 
10.50
%
 
1.50
%
 
12.00
%
 
16

HTC Borrower, LLC
 
Subordinated Debt
 
10.00
%
 
3.00
%
 
13.00
%
 
169

Park Ave RE Holdings, LLC
 
Subordinated Debt
 
13.00
%
 
—
%
 
13.00
%
 
—

PCX Aerostructures, LLC
 
Subordinated Debt
 
—
%
 
6.00
%
 
6.00
%
 
462

RMP Group, Inc.
 
Subordinated Debt
 
10.50
%
 
1.00
%
 
11.50
%
 
23

Total
 
 
 
 
 
 
 
 
 
$
5,209

(m)
The principal amount (par amount) is denominated in Canadian Dollars or CAD.
(n)
For equity investments in Collateralized Securities, the effective yield is presented in place of the investment coupon rate for each investment. Refer to footnote (v) for a further description of an equity investment in a Collateralized Security.
(o)
The provisions of the 1940 Act classify investments based on the level of control that the Company maintains in a particular portfolio company. As defined in the 1940 Act, a company is generally presumed to be "non-controlled" when the Company owns 25% or less of the portfolio company's voting securities and/or does not have the power to exercise control over the management or policies of such portfolio company. A company is generally presumed to be "controlled" when the Company owns more than 25% of the portfolio company's voting securities and/or has the power to exercise control over the management or policies of such portfolio company. The Company classifies this investment as "controlled".

The accompanying notes are an integral part of these consolidated financial statements.
33
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

(p)
The provisions of the 1940 Act classify investments further based on the level of ownership that the Company maintains in a particular portfolio company. As defined in the 1940 Act, a company is generally deemed as "non-affiliated" when the Company owns less than 5% of a portfolio company's voting securities and "affiliated" when the Company owns 5% or more of a portfolio company's voting securities. The Company classifies this investment as "affiliated".
(q)
Unless otherwise indicated, all investments in the consolidated schedule of investments are non-affiliated, non-controlled investments.
(r)
The Company's investment is held through the Consolidated Holding Company, Kahala Aviation Holdings, LLC, which owns 49% of the operating company, Danish CRJ LTD.
(s)
The investment is not a restricted security. All other securities are restricted securities.
(t)
The investment is on non-accrual status as of December 31, 2019.
(u)
Investments are held in the taxable wholly-owned, consolidated subsidiary, 54th Street Equity Holdings, Inc.
(v)
The Collateralized Securities - subordinated notes are treated as equity investments and are entitled to recurring distributions which are generally equal to the remaining cash flow of the payments made by the underlying fund’s securities less contractual payments to debt holders and fund expenses. The estimated yield indicated is based upon a current projection of the amount and timing of these recurring distributions and the estimated amount of repayment of principal upon termination. Such projections are periodically reviewed and adjusted, and the estimated yield may not ultimately be realized.
(w)
The Company's investment is held through the consolidated subsidiary, Park Ave RE, Inc., which owns 100% of the equity of the operating company, Park Ave RE Holdings, LLC.
(x)
The investment is held through BSP TCAP Acquisition Holdings LP which, as further outlined in Note 1, is an affiliated acquisition entity utilized for the Triangle Transaction. Due to certain restrictions, such as limits on the number of partners allowable within the equity structures of the newly acquired investments, these investments are still held within the acquisition entity as of December 31, 2019. 
(y)
The majority of the investments bear interest at a rate that may be determined by reference to London Interbank Offered Rate ("LIBOR" or "L") or Prime ("P") and which reset daily, monthly, quarterly, or semiannually. For each, the Company has provided the spread over LIBOR or Prime and the current interest rate in effect at December 31, 2019. 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.

The accompanying notes are an integral part of these consolidated financial statements.
34
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

CONSOLIDATED SCHEDULES OF INVESTMENTS
(dollars in thousands)

December 31, 2019
The following table shows the portfolio composition by industry grouping based on fair value at December 31, 2019:
 
At December 31, 2019
 
Investments at
Fair Value
 
Percentage of
Total Portfolio
Healthcare
$
364,143

 
14.3
%
Business Services
354,813

 
13.9
%
Industrials
308,246

 
12.1
%
Transportation
180,676

 
7.1
%
Diversified Investment Vehicles
177,339

 
7.0
%
Financials
170,154

 
6.7
%
Telecom
152,334

 
6.0
%
Energy
152,159

 
6.0
%
Media/Entertainment
141,505

 
5.5
%
Technology
128,117

 
5.0
%
Food & Beverage
109,211

 
4.3
%
Consumer
76,535

 
3.0
%
Education
54,593

 
2.1
%
Gaming/Lodging
47,577

 
1.9
%
Paper & Packaging
43,538

 
1.7
%
Software/Services
42,372

 
1.7
%
Chemicals
32,564

 
1.3
%
Health/Fitness
5,324

 
0.2
%
Retail
4,984

 
0.2
%
Total
$
2,546,184

 
100.0
%

The accompanying notes are an integral part of these consolidated financial statements.
35
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)


Note 1 — Organization and Basis of Presentation
Business Development Corporation of America (the “Company” or "BDCA") is an externally managed, non-diversified closed-end management investment company incorporated in Maryland in May 2010 that 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, the Company has elected to be treated for tax purposes as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). The Company’s investment activities are managed by BDCA Adviser, LLC (the “Adviser”), a subsidiary of Benefit Street Partners L.L.C. (“BSP”) and supervised by the Company’s Board of Directors ("Board"), a majority of whom are independent of the Adviser and its affiliates. As a BDC, the Company is required to comply with certain regulatory requirements.
The Company’s investment objective is to generate both current income and to a lesser extent long-term capital appreciation through debt and equity investments. The Company invests primarily in first and second lien senior secured loans and mezzanine debt issued by middle market companies. The Company defines middle market companies as those with annual revenues up to $1 billion. The Company also purchases interests in loans through secondary market transactions. First and second lien secured loans generally are senior debt instruments that rank ahead of subordinated debt and equity in bankruptcy priority and are generally secured by liens on the operating assets of a borrower, which may include inventory, receivables, plant, property, and equipment. Mezzanine debt is subordinated to senior loans and is generally unsecured. The Company may invest in the equity and junior debt tranches of collateralized loan obligation investment vehicles (“Collateralized Securities” or "CLOs"). CLOs are entities that are formed to manage a portfolio of senior secured loans made to companies whose debt is typically rated below investment grade or, in limited circumstances, unrated. The senior secured loans within these Collateralized Securities meet specified credit and diversity criteria and are subject to concentration limitations in order to create a diverse investment portfolio. In most cases, companies to whom the Company provides customized financing solutions will be privately held at the time the Company invests in them.
On February 1, 2019, Franklin Resources, Inc. (“FRI”) and Templeton International, Inc. (collectively with FRI, “Franklin Templeton”) acquired BSP, including BSP’s 100% ownership interest in the Adviser (the “FT Transaction”).
During the nine months ended September 30, 2020, the Company invested approximately $495.5 million in portfolio companies to contribute to the support of their business objectives of which some were contractually obligated. See Note 7 - Commitments and Contingencies. As of September 30, 2020, the Company held investments in loans it made to investee companies with aggregate principal amounts of $2,094.0 million. The details of such investments have been disclosed on the consolidated schedule of investments as well as in Note 3 - Fair Value of Financial Instruments. In addition to providing loans to investee companies, from time to time the Company may assist investee companies in securing financing from other sources by introducing such investee companies to sponsors or other lending institutions.
While the structure of the Company’s investments is likely to vary, the Company may invest in senior secured debt, senior unsecured debt, subordinated secured debt, subordinated unsecured debt, mezzanine debt, convertible debt, convertible preferred equity, preferred equity, common equity, warrants, CLOs, and other instruments, many of which generate current yields. If the Adviser deems appropriate, the Company may invest in more liquid senior secured and second lien debt securities, some of which may be traded. The Company will make such investments to the extent allowed by the 1940 Act and consistent with its continued qualification as a RIC for federal income tax purposes.
On January 25, 2011, the Company commenced its initial public offering (the “IPO”) on a “reasonable best efforts basis” of up to 150.0 million shares of common stock, $0.001 par value per share, and subsequently amended the offering to issue up to an additional 101.1 million shares of its common stock (the “Offering”). The Company closed the Offering to new investments on April 30, 2015. As of September 30, 2020, the Company had issued 228.6 million shares of common stock for gross proceeds of $2.3 billion including the shares purchased by affiliates and shares issued under the Company's distribution reinvestment plan (“DRIP”). As of September 30, 2020, the Company had repurchased a cumulative 27.9 million shares of common stock through its share repurchase program for payments of $239.7 million.
The Company intends to co-invest, subject to the conditions included in the exemptive order the Company received from the Securities and Exchange Commission ("SEC"), with certain of its affiliates. The Company believes that such co-investments may afford it additional investment opportunities and an ability to achieve greater diversification.
As a BDC, the Company is generally required to invest at least 70% of its total assets primarily in securities of private and certain U.S. public companies (other than certain financial institutions), cash, cash equivalents and U.S. Government securities, and other high-quality debt investments that mature in one year or less.

36
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

The Company is permitted to borrow money from time to time within the levels permitted by the 1940 Act (which generally currently allows it to incur leverage for up to one half of its total assets). The Company has used, and expects to continue to use, its credit facilities and other borrowings, along with proceeds from the rotation of its portfolio and proceeds from private securities offerings to finance its investment objectives.
Although the Small Business Credit Availability Act of 2018 (the “SBCAA”) amended the 1940 Act to permit BDCs to incur increased leverage if certain conditions are met, the Company does not presently intend to avail itself of the increased leverage limits permitted by the SBCAA. If the Company were to avail itself of the increased leverage permitted by the SBCAA, this would effectively allow the Company to double its leverage, which would increase leverage risk and expenses.
Note 2 — Summary of Significant Accounting Policies
Basis of Presentation
The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). The consolidated financial statements reflect all adjustments, both normal and recurring which, in the opinion of management, are necessary for the fair presentation of the Company’s results of operations and financial condition for the periods presented. The Company is an investment company and follows accounting and reporting guidance in Accounting Standards Codification ("ASC") Topic 946 - Financial Services - Investment Companies ("ASC 946").
We have also formed and expect to continue to form consolidated subsidiaries (the “Consolidated Holding Companies”). The Company consolidates the following subsidiaries for accounting purposes: BDCA Funding I, LLC (“Funding I”), BDCA-CB Funding, LLC (“CB Funding”), BDCA 57th Street Funding, LLC ("57th Street"), BDCA Asset Financing, LLC ("BDCA Asset Financing"), BDCA Helvetica Funding, Ltd. (“Helvetica Funding”), 54th Street Equity Holdings, Inc. and the Consolidated Holding Companies. All significant intercompany balances and transactions have been eliminated in consolidation. 
Prior to September 30, 2019, in conjunction with the consolidation of subsidiaries, the Company had recognized non-controlling interests attributable to third party ownership in the following Consolidated Holding Companies: Kahala Aviation Holdings, LLC, Kahala Aviation US, Inc., and Kahala LuxCo S.A.R.L. On September 30, 2019, the Company entered an agreement to purchase the third party ownership of Kahala Aviation Holdings LLC, which in turn owns 100% of the equity of Kahala Aviation US, Inc. and Kahala LuxCo S.A.R.L. As a result of this agreement, the company owns 100% of the equity of Kahala Aviation Holdings LLC, Kahala Aviation US, Inc, and Kahala LuxCo S.A.R.L, and therefore no longer recognizes a non-controlling interest in these Consolidated Holding Companies. The Kahala LuxCo S.A.R.L. entity was liquidated in the second quarter of 2020. See Note 9 - Common Stock for detail of the activity attributable to non-controlling interests.
Interim financial statements are prepared in accordance with U.S. GAAP for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Regulation S-X, as appropriate. Accordingly, the consolidated financial statements may not include all of the information and notes required by U.S. GAAP for annual consolidated financial statements. U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses during the reported periods. Changes in the economic environment, financial markets, and any other parameters used in determining these estimates could cause actual results to differ materially. The current period’s results of operations will not necessarily be indicative of results that ultimately may be achieved for the fiscal year ending on December 31, 2020.
Use of Estimates
The preparation of financial statements in conformity with U.S. 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Consolidation
As provided under ASC 946, the Company will generally not consolidate its investment in a company other than a substantially or wholly-owned investment company or controlled operating company whose business consists of providing services to the Company. Accordingly, the Company consolidated the accounts of the Company's substantially wholly-owned subsidiaries in its consolidated financial statements.

37
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Valuation of Portfolio Investments
Portfolio investments are reported on the consolidated statements of assets and liabilities at fair value. On a quarterly basis, the Company performs an analysis of each investment to determine fair value as follows:
Securities for which market quotations are readily available on an exchange are valued at the reported closing price on the valuation date. The Company may also obtain quotes with respect to certain of the Company's investments from pricing services or brokers or dealers in order to value assets. When doing so, the Company determines whether the quote obtained is readily available according to U.S. GAAP to determine the fair value of the security. If determined to be readily available, the Company uses the quote obtained.
Investments without a readily determined market value are primarily valued using a market approach, an income approach, or both approaches, as appropriate. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business). The income approach uses valuation techniques to convert future amounts (for example, cash flows or earnings) to a single present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. In following these approaches, the types of factors that the Company may take into account in fair value pricing the Company's investments include, as relevant: 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, the markets in which the portfolio company does business, comparisons of financial ratios of peer companies that are public, M&A comparables, and enterprise values, among other factors. When available, broker quotations and/or quotations provided by pricing services are considered as an input in the valuation process.
With respect to investments for which market quotations are not readily available, the Adviser undertakes a multi-step valuation process each quarter, as described below:
•
Each portfolio company or investment will be valued by the Adviser, with assistance from one or more independent valuation firms engaged by the Company's Board of Directors or as noted below, with respect to investments in an investment fund;
•
The independent valuation firm(s) conduct independent appraisals and make an independent assessment of the value of each investment; and
•
The Board of Directors determines the fair value of each investment, in good faith, based on the input of the Adviser and independent valuation firm (to the extent applicable).
For an investment in an investment fund that does not have a readily determinable fair value, the Company measures the fair value of the investment predominately based on the net asset value per share of the investment fund if the net asset value of the investment fund is calculated in a manner consistent with the measurement principles of ASC 946, as of the Company's measurement date. However, there can be no assurance that the Company will be able to sell such investment at a price equal to its net asset value per share and the Company may ultimately sell such investment at a discount to its net asset value per share.
The Company’s investments in funds that offer periodic liquidity have redemption frequencies which range from monthly to quarterly and redemption notice periods which range from 30 to 90 days. Investments in private equity typically do not offer liquidity and instead, capital is returned through periodic distributions.
Because there is not a readily available market value for most of the investments in its portfolio, the Company values substantially all of its portfolio investments at fair value as determined in good faith by its Board of Directors, as described herein. 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 Company's investments may fluctuate from period to period. Additionally, the fair value of the Company's investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that the Company may ultimately realize. Further, such investments are generally subject to legal and other restrictions on resale or otherwise are less liquid than publicly traded securities. If the Company was required to liquidate a portfolio investment in a forced or liquidation sale, the Company could realize significantly less than the value at which the Company has recorded it.

38
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Investment Classification
The Company classifies its investments in accordance with the requirements of the 1940 Act. Under the 1940 Act, “Control” is defined as the power to exercise a controlling influence over the management or policies of a company, unless such power is solely the result of an official position with such company. In addition, any person “who owns beneficially, either directly or through one or more controlled companies, more than 25% of the voting securities of a company and/or has the power to exercise control over the management or policies of such portfolio company shall be presumed to control such company. Typically, any person who does not so own more than 25% of the voting securities of any company and/or does not have the power to exercise control over the management or policies of such portfolio company shall be presumed not to control such company.” Consistent with the 1940 Act, “Affiliated Investments” are defined as those investments in companies in which the Company owns 5% or more of the voting securities. Consistent with the 1940 Act, “Non-affiliated Investments” are defined as investments that are neither Control Investments nor Affiliated Investments.
Cash and Cash Equivalents
Cash and cash equivalents include short-term, liquid investments in a money market deposit account. Cash and cash equivalents are carried at cost which approximates fair value.
Offering Costs
The Company incurs certain costs in connection with the registration of shares of its common stock. Offering costs principally relate to professional fees, printing costs, direct marketing expenses, due diligence costs, fees paid to regulators, and other expenses, including the salaries and/or expenses of the Adviser and its affiliates engaged in registering and marketing the Company’s common stock. Such allocated expenses of the Adviser and its affiliates may include the development of marketing materials and presentations, training and educational meetings, and generally coordinating the marketing process for the Company.
Pursuant to the Investment Advisory Agreement, the Company and the Adviser have agreed that the Company will not be liable for organization and offering costs, including transfer agent fees, in excess of 1.5% of the aggregate gross proceeds from the Company’s on-going offering. Should the Company resume continually offering its shares, any offering costs incurred will be capitalized and amortized as an expense on a straight-line basis over a 12-month period. For the periods ended September 30, 2020 and 2019, the Company did not incur any offering costs.
Deferred Financing Costs
Financing costs incurred in connection with the Company’s unsecured notes and revolving credit facilities are capitalized and amortized into expense using the straight-line method, which approximates the effective yield method over the life of the respective facility. See Note 5 - Borrowings for details on the credit facilities and unsecured notes.
Distributions
The Company’s Board of Directors authorizes and declares cash distributions payable on a quarterly basis to stockholders of record on each record date. The amount of each such distribution is subject to the discretion of the Board of Directors and applicable legal restrictions related to the payment of distributions. The Company calculates each stockholder’s specific distribution amount for the quarter using record and declaration dates. The distributions are payable by the fifth day following each record date. From time to time, the Company may also pay interim distributions, including capital gains distributions, at the discretion of the Company’s Board of Directors. The Company’s distributions may exceed earnings, especially during the period before it has substantially invested the proceeds from the offering. As a result, a portion of the distributions made by the Company may represent a return of capital for U.S. federal income tax purposes. A return of capital is a return of each stockholder’s investment rather than earnings or gains derived from the Company’s investment activities.
The Company may fund cash distributions to stockholders from any sources of funds available to the Company, including advances from the Adviser that are subject to reimbursement, as well as offering proceeds, borrowings, net investment income from operations, capital gain proceeds from the sale of assets, and non-capital gain proceeds from the sale of assets. The Company has not established limits on the amount of funds it may use from available sources to make distributions. See Note 13 - Income Tax Information and Distributions to Stockholders for additional information.

39
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Revenue Recognition
Interest Income
Investment transactions are accounted for on the trade date. Interest income, adjusted for amortization of premium and accretion of discount, is recorded on an accrual basis. Discount and premium on investments purchased are accreted/amortized over the expected life of the respective investment using the effective yield method. The amortized cost of investments represents the original cost adjusted for the accretion of discount and amortization of premium on investments.
The Company has a number of investments in Collateralized Securities. Interest income from investments in the “equity” class of these Collateralized Securities (in the Company's case, preferred shares or subordinated notes) is recorded based upon an estimation of an effective yield to expected maturity utilizing assumed cash flows in accordance with ASC 325-40-35, Beneficial Interests in Securitized Financial Assets ("ASC 325-40-35"). The Company monitors the expected cash inflows from its equity investments in Collateralized Securities, including the expected principal repayments. The effective yield is determined and updated quarterly. In accordance with ASC 325-40, investments in CLOs are periodically assessed for other-than-temporary impairment ("OTTI"). When the Company determines that a CLO has OTTI, the amortized cost basis of the CLO is written down as of the date of the determination based on events and information evaluated and that write-down is recognized as a realized loss.
Fee Income
Fee income, such as structuring fees, origination, closing, amendment fees, commitment, termination, and other upfront fees are generally non-recurring and are recognized as income when earned, either upon receipt or amortized into income. Upon the re-payment of a loan or debt security, any prepayment penalties and unamortized loan origination, structuring, closing, commitment, and other upfront fees are recorded as income.
Payment-in-Kind Interest/Dividends
The Company holds debt and equity investments in its portfolio that contain payment-in-kind (“PIK”) interest and dividend provisions. The PIK interest and PIK dividend, which represent contractually deferred interest or dividends that add to the investment balance that is generally due at maturity, are generally recorded on the accrual basis.
Non-accrual Income
Investments may be placed on non-accrual status when principal or interest payments are past due and/or when there is reasonable doubt that principal or interest will be collected. Accrued interest which may include un-capitalized PIK interest is generally reversed when an investment is placed on non-accrual status. Previously capitalized PIK interest is not reversed when an investment is placed on non-accrual status. Interest payments received on non-accrual investments may be recognized as income or applied to principal depending upon management's judgment of the ultimate outcome. Non-accrual investments are restored to accrual status when past due principal and interest is paid and, in management's judgment, are likely to remain current.
Net Realized Gain or Loss and Net Change in Unrealized Appreciation or Depreciation
Gain or loss on the sale of investments is calculated using the specific identification method. The Company measures realized gain or loss by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, without regard to unrealized appreciation or depreciation previously recognized. Net change in unrealized appreciation or depreciation will reflect the change in portfolio investment values during the reporting period, including any reversal of previously recorded unrealized appreciation or depreciation, when a gain or loss is realized.
Income Taxes
The Company has elected to be treated for federal income tax purposes as a RIC under Subchapter M of the Code. Generally, a RIC is not subject to federal income taxes in respect of each taxable year if it distributes dividends for federal income tax purposes to stockholders of an amount generally equal to at least 90% of ‘‘investment company taxable income,’’ as defined in the Code, and determined without regard to any deduction for dividends paid. Distributions declared prior to the filing of the previous year's tax return and paid up to twelve months after the previous tax year can be carried back to the prior tax year in determining the distributions paid in such tax year. The Company intends to make sufficient distributions to maintain its ability to be subject to be taxed as a RIC each year. The Company may be subject to federal excise tax imposed at a rate of 4% on certain undistributed amounts. See Note 13 - Income Tax Information and Distributions to Stockholders for additional information.

40
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Note 3 — Fair Value of Financial Instruments
The Company’s fair value measurements are classified into a fair value hierarchy in accordance with ASC Topic 820, Fair Value Measurement, based on the markets in which the assets and liabilities are traded, and the reliability of the assumptions used to determine fair value. Market price observability is affected by a number of factors, including the type of investment and the characteristics specific to the investment. Investments with readily available active quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.
The Company determines fair value based on quoted prices when available or through the use of alternative approaches, such as discounting the expected cash flows using market interest rates commensurate with the credit quality and duration of the investment. This alternative approach also reflects the contractual terms of the derivatives, if any, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The guidance defines three levels of inputs that may be used to measure fair value:
•
Level 1—Quoted prices in active markets for identical assets and liabilities that the reporting entity has the ability to access at the measurement date.
•
Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability.
•
Level 3—Unobservable inputs that reflect the entity’s own assumptions about the assumptions that market participants would use in the pricing of the asset or liability and are consequently not based on market activity, but rather through particular valuation techniques.
The determination of where an asset or liability falls in the above hierarchy requires significant judgment and factors specific to the asset or liability. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter.
For investments for which Level 1 inputs, such as quoted prices, were not available at September 30, 2020 and December 31, 2019, the investments were valued at fair value as determined in good faith using the valuation policy approved by the Board of Directors using Level 2 and Level 3 inputs. The Company evaluates the source of inputs, including any markets in which the Company's investments are trading, in determining fair value. Due to the inherent uncertainty in the valuation process, the estimate of fair value of the Company’s investment portfolio at September 30, 2020 and December 31, 2019 may differ materially from values that would have been used had a ready market for the securities existed.
In addition to using the above inputs in investment valuations, the Company continues to employ the valuation policy approved by the Board of Directors. Portfolio investments are reported on the consolidated statements of assets and liabilities at fair value. On a quarterly basis the Company performs an analysis of each investment to determine fair value as described below.
Securities for which market quotations are readily available on an exchange are valued at the reported closing price on the valuation date. The Company may also obtain quotes with respect to certain of the Company's investments from pricing services or brokers or dealers in order to value assets. When doing so, the Company determines whether the quote obtained is readily available according to U.S. GAAP to determine the fair value of the security. If determined readily available, the Company uses the quote obtained.

41
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Investments without a readily determined market value are primarily valued using a market approach, an income approach, or both approaches, as appropriate. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business). The income approach uses valuation techniques to convert future amounts (for example, cash flows or earnings) to a single present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. In following these approaches, the types of factors that the Company may take into account in fair value pricing the Company's investments include, as relevant: 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, the markets in which the portfolio company does business, comparisons of financial ratios of peer companies that are public, M&A comparables, and enterprise values, among other factors. When available, broker quotations and/or quotations provided by pricing services are considered as an input in the valuation process.
For an investment in an investment fund that does not have a readily determinable fair value, the Company measures the fair value of the investment predominately based on the net asset value per share of the investment fund if the net asset value of the investment fund is calculated in a manner consistent with the measurement principles of ASC Topic 946, as of the Company's measurement date.
For investments in Collateralized Securities, the Adviser models both the assets and liabilities of each Collateralized Securities' capital structure. The model uses a waterfall engine to store the collateral data, generate cash flows from the assets, and distribute the cash flows to the liability structure based on the contractual priority of payments. The cash flows are discounted using rates that incorporate risk factors such as default risk, interest rate risk, downgrade risk, and credit spread risk, among others. In addition, the Adviser considers broker quotations and/or comparable trade activity is considered as an input to determining fair value when available.
As part of the Company's quarterly valuation process, the Adviser may be assisted by one or more independent valuation firms engaged by the Company. The Board of Directors determines the fair value of each investment, in good faith, based on the input of the Adviser and the independent valuation firm(s) (to the extent applicable).
Determination of fair values involves subjective judgments and estimates. Accordingly, the notes to the consolidated financial statements refer to the uncertainty with respect to the possible effect of such valuations, and any change in such valuations on the consolidated financial statements.
For discussion of the fair value measurement of the Company's borrowings, refer to Note 5 - Borrowings.
For discussion of the fair value measurement of the Company's foreign currency contracts, refer to Note 6 - Derivatives.
The following table presents fair value measurements of investments, by major class, as of September 30, 2020, according to the fair value hierarchy:
 
Fair Value Measurements
 
Level 1
 
Level 2
 
Level 3
 
Measured at Net Asset Value (1)
 
Total
Senior Secured First Lien Debt
$
—

 
$
436,663

 
$
1,122,574

 
$
—

 
$
1,559,237

Senior Secured Second Lien Debt
—

 
24,992

 
185,919

 
—

 
210,911

Subordinated Debt
—

 
8,953

 
108,561

 
—

 
117,514

Collateralized Securities
—

 
—

 
95,746

 
—

 
95,746

Equity/Other
128

 
—

 
163,760

 
63,455

 
227,343

Total
$
128

 
$
470,608

 
$
1,676,560

 
$
63,455

 
$
2,210,751

______________
(1) In accordance with ASC Subtopic 820-10, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient election have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated statements of assets and liabilities.

42
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

The following table presents fair value measurements of investments, by major class, as of December 31, 2019, according to the fair value hierarchy:
 
Fair Value Measurements
 
Level 1
 
Level 2
 
Level 3
 
Measured at Net Asset Value (1)
 
Total
Senior Secured First Lien Debt
$
—

 
$
642,755

 
$
1,121,537

 
$
—

 
$
1,764,292

Senior Secured Second Lien Debt
—

 
35,246

 
271,232

 
—

 
306,478

Subordinated Debt
—

 
11,051

 
97,100

 
—

 
108,151

Collateralized Securities
—

 
—

 
108,927

 
—

 
108,927

Equity/Other
2,624

 
—

 
187,300

 
68,412

 
258,336

Total
$
2,624

 
$
689,052

 
$
1,786,096

 
$
68,412

 
$
2,546,184

______________
(1) In accordance with ASC Subtopic 820-10, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient election have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated statements of assets and liabilities.
The following table provides a reconciliation of the beginning and ending balances for investments that use Level 3 inputs for the nine months ended September 30, 2020:
 
Senior Secured First Lien Debt
 
Senior Secured Second Lien Debt
 
Subordinated Debt
 
Collateralized Securities
 
Equity/Other
 
Total
Balance as of December 31, 2019
$
1,121,537

 
$
271,232

 
$
97,100

 
$
108,927

 
$
187,300

 
$
1,786,096

Net change in unrealized appreciation (depreciation) on investments
(14,273
)
 
(2,968
)
 
4,461

 
(29,568
)
 
(15,393
)
 
(57,741
)
Purchases and other adjustments to cost
243,846

 
7,799

 
28,116

 
53,891

 
5,751

 
339,403

Sales and repayments
(325,586
)
 
(56,345
)
 
(19,914
)
 
(35,792
)
 
(19,398
)
 
(457,035
)
Net realized gain (loss)
(51,121
)
 
(29,542
)
 
(1,202
)
 
(1,712
)
 
5,500

 
(78,077
)
Transfers in
185,333

 
16,297

 
—

 
—

 
—

 
201,630

Transfers out
(37,162
)
 
(20,554
)
 
—

 
—

 
—

 
(57,716
)
Balance as of September 30, 2020
$
1,122,574

 
$
185,919

 
$
108,561

 
$
95,746

 
$
163,760

 
$
1,676,560

Net change in unrealized appreciation (depreciation) for the period relating to those Level 3 assets that were still held by the Company at the end of the period:
$
(53,493
)
 
$
(20,462
)
 
$
4,850

 
$
(29,924
)
 
$
(14,608
)
 
$
(113,637
)
Purchases represent the acquisition of new investments at cost. Sales and repayments represent principal payments received during the period.
For the nine months ended September 30, 2020, transfers from Level 2 to Level 3 were due to current assessments of investment liquidity and a decrease in the number of observable market inputs. For the nine months ended September 30, 2020, transfers from Level 3 to Level 2 were due to an increase in the number of observable market inputs.

43
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

The following table provides a reconciliation of the beginning and ending balances for investments that use Level 3 inputs for the year ended December 31, 2019:
 
Senior Secured First Lien Debt
 
Senior Secured Second Lien Debt
 
Subordinated Debt
 
Collateralized Securities
 
Equity/Other
 
Total
Balance as of December 31, 2018
$
1,039,223

 
$
252,651

 
$
92,595

 
$
127,212

 
$
117,107

 
$
1,628,788

Net change in unrealized appreciation (depreciation) on investments
11,310

 
(13,032
)
 
2,896

 
13,773

 
29,402

 
44,349

Purchases and other adjustments to cost
399,096

 
95,904

 
25,976

 
54,094

 
76,674

 
651,744

Sales and repayments
(287,445
)
 
(73,393
)
 
(35,326
)
 
(60,418
)
 
(48,014
)
 
(504,596
)
Net realized gain (loss)
(45,639
)
 
464

 
(607
)
 
(25,734
)
 
12,131

 
(59,385
)
Transfers in
55,783

 
16,396

 
11,566

 
—

 
—

 
83,745

Transfers out
(50,791
)
 
(7,758
)
 
—

 
—

 
—

 
(58,549
)
Balance as of December 31, 2019
$
1,121,537

 
$
271,232

 
$
97,100

 
$
108,927

 
$
187,300

 
$
1,786,096

Net change in unrealized appreciation (depreciation) for the period relating to those Level 3 assets that were still held by the Company at the end of the period:
$
(29,473
)
 
$
(12,908
)
 
$
(1,595
)
 
$
(7,891
)
 
$
29,109

 
$
(22,758
)
Purchases represent the acquisition of new investments at cost. Sales and repayments represent principal payments received during the period.
For the year ended December 31, 2019, transfers from Level 2 to Level 3 were due to a decrease in the number of observable market inputs. For the year ended December 31, 2019, transfers from Level 3 to Level 2 were due to an increase in the number of observable market inputs.
The composition of the Company’s investments as of September 30, 2020, at amortized cost and fair value, were as follows:
 
Investments at
Amortized Cost
 
Investments at
Fair Value
 
Fair Value
Percentage of
Total Portfolio
Senior Secured First Lien Debt
$
1,673,953

 
$
1,559,237

 
70.6
%
Senior Secured Second Lien Debt
242,351

 
210,911

 
9.5

Subordinated Debt
115,647

 
117,514

 
5.3

Collateralized Securities
139,252

 
95,746

 
4.3

Equity/Other
199,371

 
227,343

 
10.3

Total
$
2,370,574

 
$
2,210,751

 
100.0
%
The composition of the Company’s investments as of December 31, 2019, at amortized cost and fair value, were as follows:
 
Investments at
Amortized Cost
 
Investments at
Fair Value
 
Fair Value
Percentage of
Total Portfolio
Senior Secured First Lien Debt
$
1,862,228

 
$
1,764,292

 
69.3
%
Senior Secured Second Lien Debt
335,366

 
306,478

 
12.0

Subordinated Debt
109,006

 
108,151

 
4.2

Collateralized Securities
122,870

 
108,927

 
4.3

Equity/Other
210,172

 
258,336

 
10.2

Total
$
2,639,642

 
$
2,546,184

 
100.0
%

44
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Significant Unobservable Inputs
The following table summarizes the significant unobservable inputs used to value the majority of the Level 3 investments as of September 30, 2020. The table is not intended to be all-inclusive, but instead identifies the significant unobservable inputs relevant to the determination of fair values.
 
 
 
 
Range
 
 
Asset Category
 
Fair Value
 
Primary Valuation Technique
 
Unobservable Inputs
 
Minimum
 
Maximum
 
Weighted Average (a)
Senior Secured First Lien Debt
 
$
885,687

 
Discounted Cash Flow
 
Market Yield
 
4.14%
 
28.04%
 
9.15%
Senior Secured First Lien Debt
 
78,248

 
Yield Analysis
 
Market Yield
 
5.48%
 
14.12%
 
7.88%
Senior Secured First Lien Debt
 
55,903

 
Waterfall Analysis
 
EBITDA Multiple
 
0.40x
 
9.50x
 
6.70x
Senior Secured First Lien Debt (c)
 
45,488

 
N/A
 
N/A
 
N/A
 
N/A
 
N/A
Senior Secured First Lien Debt (b)
 
26,549

 
Waterfall Analysis
 
Discount Rate
 
16.00%
 
16.00%
 
16.00%
Senior Secured First Lien Debt (b)
 
20,700

 
Recovery Analysis
 
EBITDA Multiple
 
7.03x
 
7.03x
 
7.03x
Senior Secured First Lien Debt
 
9,999

 
Waterfall Analysis
 
Revenue Multiple
 
0.17x
 
0.93x
 
0.46x
Senior Secured Second Lien Debt
 
125,031

 
Discounted Cash Flow
 
Market Yield
 
7.55%
 
22.50%
 
11.20%
Senior Secured Second Lien Debt
 
50,255

 
Yield Analysis
 
Market Yield
 
8.47%
 
26.91%
 
13.31%
Senior Secured Second Lien Debt (b)
 
8,000

 
Waterfall Analysis
 
EBITDA Multiple
 
5.90x
 
5.90x
 
5.90x
Senior Secured Second Lien Debt
 
2,633

 
Waterfall Analysis
 
Revenue Multiple
 
0.48x
 
0.93x
 
0.56x
Subordinated Debt (b)
 
38,474

 
Discounted Cash Flow
 
Discount Rate
 
10.75%
 
10.75%
 
10.75%
Subordinated Debt (b)
 
25,500

 
Waterfall Analysis
 
Tangible Net Asset Value Multiple
 
1.42x
 
1.42x
 
1.42x
Subordinated Debt (b)
 
24,094

 
Discounted Cash Flow
 
Market Yield
 
8.63%
 
8.63%
 
8.63%
Subordinated Debt
 
15,320

 
Waterfall Analysis
 
EBITDA Multiple
 
4.00x
 
5.81x
 
4.66x
Subordinated Debt
 
5,173

 
Yield Analysis
 
Market Yield
 
12.02%
 
24.68%
 
19.26%
Collateralized Securities
 
89,320

 
Discounted Cash Flow
 
Discount Rate
 
7.65%
 
35.00%
 
15.98%
Collateralized Securities (c)
 
6,426

 
N/A
 
N/A
 
N/A
 
N/A
 
N/A
Equity/Other
 
69,962

 
Waterfall Analysis
 
Discount Rate
 
16.00%
 
16.00%
 
16.00%
Equity/Other
 
32,460

 
Waterfall Analysis
 
Tangible Net Asset Value Multiple
 
1.30x
 
1.42x
 
1.42x
Equity/Other
 
25,564

 
Waterfall Analysis
 
EBITDA Multiple
 
1.63x
 
12.00x
 
8.04x
Equity/Other
 
23,457

 
Discounted Cash Flow
 
Market Yield
 
11.95%
 
13.66%
 
12.58%

45
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Equity/Other (b) (c)
 
4,995

 
N/A
 
N/A
 
N/A
 
N/A
 
N/A
Equity/Other
 
3,342

 
Waterfall Analysis
 
Revenue Multiple
 
0.12x
 
2.37x
 
1.85x
Equity/Other (b)
 
2,168

 
Waterfall Analysis
 
TBV Multiple
 
3.20x
 
3.20x
 
3.20x
Equity/Other (b)
 
1,812

 
Discounted Cash Flow
 
Discount Rate
 
10.75%
 
10.75%
 
10.75%
Total
 
$
1,676,560

 
 
 
 
 
 
 
 
 
 
______________
(a) 
Weighted averages are calculated based on fair value of investments.
(b) 
This asset category contains one investment.
(c) 
This instrument(s) was held at cost.
There were no significant changes in valuation approach or technique as of September 30, 2020.
Level 3 Inputs to the valuation methodology are unobservable and significant to overall fair value measurement. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in this category include investments in privately held entities where the fair value is based on unobservable inputs.
The income and market approaches were used in the determination of fair value of certain Level 3 assets as of September 30, 2020 and December 31, 2019. The significant unobservable inputs used in the income approach are the discount rate or market yield used to discount the estimated future cash flows expected to be received from the underlying investment, which include both future principal and interest payments. An increase in the discount rate or market yield would result in a decrease in the fair value. Included in the consideration and selection of discount rates is risk of default, rating of the investment, call provisions and comparable company investments. The significant unobservable inputs used in the market approach are based on market comparable transactions and market multiples of publicly traded comparable companies. Increases or decreases in market comparable transactions or market multiples would result in an increase or decrease, respectively, in the fair value.
Valuations of loans, corporate debt, and other debt obligations are generally based on discounted cash flow techniques, for which the significant inputs are the amount and timing of expected future cash flows, market yields and recovery assumptions. The significant inputs are generally determined based on relative value analysis, which incorporate comparisons to other debt instruments for which observable prices or broker quotes are available. Other valuation methodologies are used as appropriate including market comparables, transactions in similar instruments and recovery/liquidation analysis. The Company also considers the use of EBITDA multiples, revenue multiples, tangible net asset value multiples, TBV multiples, and other relevant multiples on its debt and equity investments to determine any credit gains or losses in certain instances. Increases or decreases in either of these inputs in isolation may result in a significantly lower or higher fair value measurement of the respective subject instrument.
The following table summarizes the significant unobservable inputs used to value the majority of the Level 3 investments as of December 31, 2019. The table is not intended to be all-inclusive, but instead identifies the significant unobservable inputs relevant to the determination of fair values.
 
 
 
 
Range
 
 
Asset Category
 
Fair Value
 
Primary Valuation Technique
 
Unobservable Inputs
 
Minimum
 
Maximum
 
Weighted Average (a)
Senior Secured First Lien Debt
 
$
858,510

 
Discounted Cash Flow
 
Market Yield
 
6.50%
 
57.85%
 
10.00%
Senior Secured First Lien Debt
 
119,724

 
Waterfall Analysis
 
Discount Rate
 
13.00%
 
19.39%
 
13.76%
Senior Secured First Lien Debt (c)
 
51,492

 
N/A
 
N/A
 
N/A
 
N/A
 
N/A
Senior Secured First Lien Debt
 
48,582

 
Yield Analysis
 
Market Yield
 
6.15%
 
15.65%
 
10.72%
Senior Secured First Lien Debt
 
40,373

 
Waterfall Analysis
 
EBITDA Multiple
 
3.00x
 
5.50x
 
3.86x

46
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Senior Secured First Lien Debt
 
2,856

 
Waterfall Analysis
 
Revenue Multiple
 
0.42x
 
0.92x
 
0.71x
Senior Secured Second Lien Debt
 
201,399

 
Discounted Cash Flow
 
Market Yield
 
6.17%
 
28.00%
 
11.40%
Senior Secured Second Lien Debt
 
46,566

 
Yield Analysis
 
Market Yield
 
10.43%
 
19.73%
 
11.38%
Senior Secured Second Lien Debt
 
18,353

 
Waterfall Analysis
 
EBITDA Multiple
 
4.85x
 
7.86x
 
5.16x
Senior Secured Second Lien Debt
 
4,914

 
Waterfall Analysis
 
Revenue Multiple
 
0.48x
 
1.59x
 
0.94x
Subordinated Debt (b)
 
37,237

 
Discounted Cash Flow
 
Discount Rate
 
8.50%
 
8.50%
 
8.50%
Subordinated Debt (b)
 
22,500

 
Waterfall Analysis
 
Tangible Net Asset Value Multiple
 
1.70x
 
1.70x
 
1.70x
Subordinated Debt
 
13,581

 
Yield Analysis
 
Market Yield
 
12.18%
 
19.59%
 
14.45%
Subordinated Debt (b)
 
12,550

 
Discounted Cash Flow
 
Market Yield
 
9.00%
 
9.00%
 
9.00%
Subordinated Debt
 
11,232

 
Waterfall Analysis
 
EBITDA Multiple
 
5.69x
 
7.94x
 
6.76x
Collateralized Securities
 
85,163

 
Discounted Cash Flow
 
Discount Rate
 
4.60%
 
22.50%
 
12.51%
Collateralized Securities (c)
 
23,764

 
N/A
 
N/A
 
N/A
 
N/A
 
N/A
Equity/Other
 
81,355

 
Waterfall Analysis
 
Discount Rate
 
12.50%
 
13.00%
 
12.87%
Equity/Other
 
37,833

 
Waterfall Analysis
 
Tangible Net Asset Value Multiple
 
1.70x
 
1.94x
 
1.71x
Equity/Other
 
28,943

 
Discounted Cash Flow
 
Market Yield
 
6.66%
 
13.75%
 
10.11%
Equity/Other
 
20,332

 
Waterfall Analysis
 
EBITDA Multiple
 
3.30x
 
12.06x
 
7.62x
Equity/Other (b)
 
11,133

 
Discounted Cash Flow
 
Discount Rate
 
8.50%
 
8.50%
 
8.50%
Equity/Other
 
3,949

 
Waterfall Analysis
 
Revenue Multiple
 
0.16x
 
2.50x
 
1.56x
Equity/Other (b)
 
3,755

 
Waterfall Analysis
 
TBV Multiple
 
4.30x
 
4.30x
 
4.30x
Total
 
$
1,786,096

 
 
 
 
 
 
 
 
 
 
______________
(a) 
Weighted averages are calculated based on fair value of investments.
(b) 
This asset category contains one investment.
(c) 
This instrument(s) was held at cost.
There were no significant changes in valuation approach or technique as of December 31, 2019.
Increases or decreases in any of the above unobservable inputs in isolation would result in a lower or higher fair value measurement for such assets.

47
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

As of September 30, 2020, the Company had fifteen portfolio companies, which represented twenty investments, on non-accrual status with a total amortized cost of $142.9 million and fair value of $83.0 million which represented 6.0% and 3.8% of the investment portfolio's total amortized cost and fair value, respectively. As of December 31, 2019, the Company had eight portfolio companies, which represented twelve investments, on non-accrual status with a total amortized cost of $62.8 million and fair value of $22.5 million, which represented 2.4%, and 0.9% of the investment portfolio's total amortized cost and fair value, respectively. Refer to Note 2 - Summary of Significant Accounting Policies - for additional details regarding the Company’s non-accrual policy.
Note 4 — Related Party Transactions and Arrangements
Investment Advisory Agreement
Pursuant to the Investment Advisory Agreement and for the investment advisory and management services provided thereunder, the Company pays the Adviser a base management fee and an incentive fee.
Prior to February 1, 2019, the Adviser provided investment advisory and management services under the investment advisory and management services agreement, effective November 1, 2016 (the “Prior Investment Advisory Agreement”), and most recently re-approved by the Board in August 2018. The terms of the Prior Investment Advisory Agreement were materially identical to the Investment Advisory Agreement. The Prior Investment Advisory Agreement automatically terminated on February 1, 2019 upon the indirect change of control of the Adviser on the consummation of Franklin Templeton's acquisition of BSP. The Investment Advisory Agreement was approved by the Board, including a majority of independent directors, on October 22, 2018, and by stockholders at a special meeting held on January 11, 2019 and took effect February 1, 2019.
Base Management Fee
The base management fee is calculated at an annual rate of 1.5% of the Company’s average gross assets. The Company's gross assets increase or decrease with any appreciation or depreciation associated with a derivative contract. Average gross assets is calculated based on the average value of the Company’s gross assets at the end of the two most recently completed calendar quarters. The base management fee is payable quarterly in arrears and is appropriately pro-rated for any partial month or quarter. All or any part of the base management fee not taken as to any quarter may be deferred without interest and may be taken in such other quarter as the Adviser will determine within three years.
As of September 30, 2020 and December 31, 2019, $8.9 million and $10.1 million was payable to the Adviser for base management fees, respectively.
For the three and nine months ended September 30, 2020, the Company incurred $8.9 million and $28.3 million, respectively, in base management fees under the Investment Advisory Agreement. For the three and nine months ended September 30, 2019, the Company incurred $10.3 million and $29.7 million, respectively, in base management fees under the Investment Advisory Agreement.
Incentive Fees
The incentive fee consists of two parts. The first part is referred to as the incentive fee on income and it is calculated and payable quarterly in arrears based on the Company’s “Pre-Incentive Fee Net Investment Income” for the immediately preceding quarter. “Pre-Incentive Fee Net Investment Income” means interest income, dividend income, and any other income (including any other fees, other than fees for providing managerial assistance, such as commitment, origination, structuring, diligence, and consulting fees or other fees that the Company receives from portfolio companies) accrued during the calendar quarter, minus the Company’s operating expenses for the quarter (including the base management fee, expenses payable under the administration agreement and any interest expense and dividends paid on any issued and 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 original issue discount debt instruments with payment-in-kind interest and zero coupon securities), accrued income that the Company has not yet received in cash. Pre-Incentive Fee Net Investment Income does not include any realized capital gains or losses, or unrealized capital appreciation or depreciation. The payment of the incentive fee on income is subject to payment of a preferred return to investors each quarter, expressed as a quarterly rate of return on the value of the Company's net assets at the end of the most recently completed calendar quarter, of 1.75% (7.00% annualized), subject to a “catch up” feature (as described below). The calculation of the incentive fee on income for each quarter is as follows:

48
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

•
No incentive fee on income will be payable to the Adviser in any calendar quarter in which the Company’s Pre-Incentive Fee Net Investment Income does not exceed the preferred return rate of 1.75% or 7.00% annualized (the “Preferred Return”) on net assets;
•
100% of the Company’s Pre-Incentive Fee Net Investment Income, if any, that exceeds the preferred return but is less than or equal to 2.1875% in any calendar quarter (8.75% annualized) will be payable to the Adviser. This portion of the Company’s incentive fee on income is referred to as the “catch up” and is intended to provide the Adviser with an incentive fee of 20% on all of the Company’s Pre-Incentive Fee Net Investment Income when the Company’s Pre-Incentive Fee Net Investment Income reaches 2.1875% (8.75% annualized) in any calendar quarter; and
•
For any quarter in which the Company's Pre-Incentive Fee Net Investment Income exceeds 2.1875% (8.75% annualized), the incentive fee on income will be equal to 20% of the amount of the Company’s Pre-Incentive Fee Net Investment Income, as the Preferred Return and catch-up will have been achieved.
As of September 30, 2020 and December 31, 2019, $0.0 million and $6.5 million was payable to the Adviser for the incentive fee on income, respectively.
For both the three and nine months ended September 30, 2020, the Company did not incur incentive fees on income under the Investment Advisory Agreement. For the three and nine months ended September 30, 2019, the Company incurred $7.0 million and $20.5 million, respectively, in incentive fees on income under the Investment Advisory Agreement.
The second part of the incentive fee, referred to as the “incentive fee on capital gains during operations,” is an incentive fee on capital gains earned on liquidated investments from the portfolio during operations prior to the Company’s liquidation and is determined and payable in arrears as of the end of each calendar year (or upon termination of the Investment Advisory Agreement, if earlier). This fee equals 20% of the Company’s incentive fee capital gains, which equals the Company’s realized capital gains on a cumulative basis from inception, calculated as of the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees. For the three and nine months ended September 30, 2020 and 2019, the Company did not incur incentive fees on capital gains during operations under the Investment Advisory Agreement.
Administration Agreement
In connection with the Administration Agreement, BSP provides the Company with office facilities and administrative services. As of September 30, 2020 and December 31, 2019, $0.6 million and $0.6 million was payable to BSP under the Administration Agreement, respectively.
For the three and nine months ended September 30, 2020, the Company incurred $0.6 million and $1.4 million, respectively, in administrative service fees under the Administration Agreement. For the three and nine months ended September 30, 2019, the Company incurred $0.6 million and $1.8 million, respectively, in administrative service fees under the Administration Agreement.
Co-Investment Relief
The 1940 Act generally prohibits BDCs from entering into negotiated co-investments with affiliates absent an order from the SEC. The SEC staff has granted the Company exemptive relief that allows it to enter into certain negotiated co-investment transactions alongside with other funds managed by the Adviser or its affiliates (“Affiliated Funds”) in a manner consistent with its investment objective, positions, policies, strategies, and restrictions as well as regulatory requirements and other pertinent factors, subject to compliance with certain conditions (the “Order”). Pursuant to the Order, the Company is permitted to co-invest with its affiliates if a “required majority” (as defined in Section 57(o) of the 1940 Act) of its eligible directors make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the transactions, including the consideration to be paid, are reasonable and fair to the Company and the Company's stockholders and do not involve overreaching in respect of the Company or the Company's stockholders on the part of any person concerned, and (2) the transaction is consistent with the interests of the Company’s stockholders and is consistent with the Company’s investment objective and strategies.    
Private Placement in connection with FT Transaction
On February 1, 2019, Franklin Templeton acquired BSP, including BSP’s 100% ownership interest in our Adviser. In connection with the FT Transaction, on November 1, 2018, the Company issued approximately 6.1 million and 4.9 million shares of the Company's common stock to FRI and BSP, respectively, at a purchase price of $8.20 per share in a private placement in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”).

49
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Other Affiliated Parties
The Adviser is the investment adviser of BDCA. The Adviser is an affiliate of BSP, an SEC registered investment adviser. The Adviser and BSP are under common control. Prior to the consummation of the FT Transaction on February 1, 2019, the Adviser was affiliated and under common control with Providence Equity Capital Markets L.L.C. (“PECM”), an SEC registered investment adviser on the BSP platform. The Adviser was affiliated and under common control with Providence Equity Partners L.L.C. (“PEP”), an SEC registered investment adviser. PEP is a global private equity investment adviser and maintained an information barrier between itself and the Adviser, BSP and PECM. The Adviser was affiliated and under common control with Merganser Capital Management, LLC (“Merganser”), an SEC registered investment adviser. BSP, the Adviser, PECM, Merganser and PEP’s respective Form ADV’s are publicly available for review on the SEC Investment Adviser Public Disclosure website.
Note 5 — Borrowings
Wells Fargo Credit Facility
On July 24, 2012, the Company, through a wholly-owned, consolidated special purpose financing subsidiary, Funding I, entered into a revolving credit facility with Wells Fargo and U.S. Bank as collateral agent, account bank, and collateral custodian (as amended from time to time, the “Existing Wells Fargo Credit Facility”). The Existing Wells Fargo Credit Facility was amended on July 7, 2020 (the "July 7th Amendment") to decrease the total aggregate principal amount of borrowings from $600.0 million on a committed basis to $575.0 million. Prior to the July 7th Amendment, the facility was priced at one-month LIBOR, with no LIBOR floor, plus a spread ranging between 1.65% and 2.50% per annum. After the July 7th Amendment, the Existing Wells Fargo Credit Facility was priced at one-month LIBOR, with no LIBOR floor, plus a spread of 2.75% per annum. Interest was payable quarterly in arrears. Funding I was subject to a non-usage fee to the extent the aggregate principal amount available under the Existing Wells Fargo Credit Facility has not been borrowed. The non-usage fee per annum was 0.50% for the first 25% of the unused balance and 2.0% for the portion of the unused balance that exceeded 25%, except for the period from March 15, 2019 through June 15, 2019, where the non-usage fee per annum was 0.50% on any principal amount unused.
On August 28, 2020, the Company refinanced the Existing Wells Fargo Credit Facility with (i) a $300.0 million revolving credit facility with the Company, as collateral manager, Funding I, as borrower, the lenders party thereto, Wells Fargo, as administrative agent, and U.S. Bank, as collateral agent and collateral custodian (the “New Wells Fargo Credit Facility,” together with Existing Wells Fargo Credit Facility, “Wells Fargo Credit Facility”) and (ii) the JPM Credit Facility (as defined below).
The New Wells Fargo Credit Facility provides for borrowings through August 28, 2023, and any amounts borrowed under the New Wells Fargo Credit Facility will mature on August 28, 2025. The New Wells Fargo Credit Facility is priced at three-month LIBOR, with a LIBOR floor of zero, plus a spread calculated based upon the composition of loans in the collateral pool, which will not exceed 2.75% per annum. Interest is payable quarterly in arrears. Funding I will be subject to a non-usage fee to the extent the commitments available under the New Wells Fargo Credit Facility have not been borrowed. The non-usage fee per annum is 0.50% for the first 25% of the unused balance and 2.0% for the portion of the unused balance that exceeds 25%. Funding I paid a structuring fee and incurred other customary costs and expenses in connection with the New Wells Fargo Credit Facility.
Funding I’s obligations under the New Wells Fargo Credit Facility are secured by a first priority security interest in substantially all of the assets of Funding I, including its portfolio of investments and the Company’s equity interest in Funding I. The obligations of Funding I under the New Wells Fargo Credit Facility are non-recourse to the Company.
In connection with the New Wells Fargo Credit Facility, the Company and Funding I have made certain representations and warranties and are required to comply with various covenants and other customary requirements. The New Wells Fargo Credit Facility contains customary default provisions pursuant to which the administrative agent and the lenders under the New Wells Fargo Credit Facility may terminate the Company in its capacity as collateral manager/portfolio manager under the New Wells Fargo Credit Facility. Upon the occurrence of an event of default under the New Wells Fargo Credit Facility, the administrative agent or the lenders may declare the outstanding advances and all other obligations under the New Wells Fargo Credit Facility immediately due and payable.
JPM Credit Facility
On August 28, 2020, the Company, through a wholly-owned, consolidated special purpose financing subsidiary, 57th Street, entered into a $300.0 million revolving credit facility with JPMorgan Chase Bank, National Association, as administrative agent (“JPM”), and U.S. Bank, as collateral agent, collateral administrator and securities intermediary (the “JPM Credit Facility”).

50
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

The JPM Credit Facility provides for borrowings through August 28, 2023, and any amounts borrowed under the JPM Credit Facility will mature on August 28, 2023 unless the administrative agent exercises its option to extend the maturity date to August 28, 2024. The JPM Credit Facility is priced at three-month LIBOR, with a LIBOR floor of zero, plus a spread of 2.75% per annum. Interest is payable quarterly in arrears. 57th Street will be subject to a non-usage fee to the extent the commitments available under the JPM Credit Facility have not been borrowed. The non-usage fee per annum is 0.50% until August 28, 2021, where the non-usage fee per annum will be 0.75% on any principal amount unused. 57th Street paid a structuring fee and incurred other customary costs and expenses in connection with the JPM Credit Facility.
57th Street’s obligations under the JPM Credit Facility are secured by a first priority security interest in substantially all of the assets of 57th Street, including its portfolio of investments and the Company’s equity interest in 57th Street. The obligations of 57th Street under the JPM Credit Facility are non-recourse to the Company.
In connection with the JPM Credit Facility, the Company and 57th Street have made certain representations and warranties and are required to comply with various covenants and other customary requirements. The JPM Credit Facility contains customary default provisions pursuant to which the administrative agent and the lenders under the JPM Credit Facility may terminate the Company in its capacity as collateral manager/portfolio manager under the JPM Credit Facility. Upon the occurrence of an event of default under the JPM Credit Facility, the administrative agent or the lenders may declare the outstanding advances and all other obligations under the JPM Credit Facility immediately due and payable.
Citi Credit Facility
On June 27, 2014, the Company, through a wholly-owned, special purpose financing subsidiary, CB Funding, entered into a credit facility (as amended from time to time, the “Citi Credit Facility”) with Citibank, N.A. ("Citi") as administrative agent and U.S. Bank as collateral agent, account bank, and collateral custodian. The Citi Credit Facility provides for borrowings in an aggregate principal amount of up to $400.0 million on a committed basis, subject to the administrative agent’s right to approve the assets acquired by CB Funding and pledged as collateral under the Citi Credit Facility. The Citi Credit Facility's reinvestment period ends on May 31, 2021 and matures on May 31, 2022. On June 22, 2020, the Company, through CB Funding, entered into an amendment (the “Citi Amendment”) to the Citi Credit Facility. The Citi Amendment, among other things, makes certain changes to the Citi Credit Facility in connection with the upcoming LIBOR discontinuation. In connection with the Citi Credit Facility, CB Funding has made certain representations and warranties, is required to comply with various covenants, reporting requirements, and other customary requirements for similar facilities and is subject to certain customary events of default. Upon the occurrence and during the continuation of an event of default, Citi may declare the outstanding advances and all other obligations under the Citi Credit Facility immediately due and payable. During the continuation of an event of default, CB Funding must pay interest at a default rate.
The Citi Credit Facility contains customary default provisions for facilities of this type pursuant to which Citi may terminate the rights, obligations, power, and authority of the Company, in its capacity as servicer of the portfolio assets under the Citi Credit Facility, including, but not limited to, non-performance of Citi Credit Facility obligations, insolvency, defaults of certain financial covenants, and other events with respect to the Company that may be adverse to Citi and the secured parties under the Citi Credit Facility.
The Citi Credit Facility is priced at three-month LIBOR plus a spread of 1.60% per annum through and including the last day of the investment period and 2.00% per annum thereafter. Interest is payable quarterly in arrears. CB Funding is subject to a non-usage fee to the extent the aggregate principal amount available under the Citi Credit Facility has not been borrowed. The non-usage fee per annum is 0.50%. Any amounts borrowed under the Citi Credit Facility along with any accrued and unpaid interest thereunder will mature, and will be due and payable, in three years.
MassMutual Credit Facility
On July 7, 2020, the Company and a wholly-owned, special purpose financing subsidiary, BDCA Asset Financing, entered into a loan and servicing agreement (the “MassMutual Credit Facility”) with Massachusetts Mutual Life Insurance Company (“MassMutual”) as facility servicer and a lender and U.S. Bank National Association as collateral custodian, collateral administrator and administrative agent. The MassMutual Credit Facility provides for borrowings of up to $100.0 million on a committed basis, and, subject to satisfaction of certain conditions, contains an accordion feature whereby the Mass Mutual Credit Facility can be expanded to $150.0 million.
BDCA Asset Financing’s obligations under the MassMutual Credit Facility are secured by a first priority security interest in substantially all of the assets of BDCA Asset Financing, including its portfolio of investments and the Company’s equity interest in BDCA Asset Financing. The obligations of BDCA Asset Financing under the MassMutual Credit Facility are non-recourse to the Company.

51
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

The MassMutual Credit Facility provides for borrowings through December 31, 2021 and matures on December 31, 2025.
The MassMutual Credit Facility is priced at three-month LIBOR, with a LIBOR floor of 0.75%, plus a spread of 5.0% per annum. Interest is payable quarterly in arrears. BDCA Asset Financing will be subject to a non-usage fee of 0.50% to the extent the aggregate principal amount available under the MassMutual Credit Facility has not been borrowed. BDCA Asset Financing paid a structuring fee and incurred other customary costs and expenses in connection with the MassMutual Credit Facility.
In connection with the MassMutual Credit Facility, the Company and BDCA Asset Financing have made certain representations and warranties and are required to comply with various covenants and other customary requirements. The MassMutual Credit Facility contains customary default provisions pursuant to which MassMutual may terminate the Company in its capacity as portfolio asset servicer of the portfolio assets under the MassMutual Credit Facility. Upon the occurrence of an event of default, MassMutual may declare the outstanding advances and all other obligations under the MassMutual Credit Facility immediately due and payable.
2020 Notes
On August 26, 2015, the Company entered into a Purchase Agreement with certain initial purchasers, relating to the Company’s sale of $100.0 million aggregate principal amount of its 6.00% fixed rate senior notes due 2020 (the “2020 Notes”) to the initial purchasers in a private placement in reliance on Section 4(a)(2) of the Securities Act and for initial resale by the initial purchasers to qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A promulgated under the Securities Act. The Company relied upon these exemptions from registration based in part on representations made by the initial purchasers. The Purchase Agreement included customary representations, warranties, and covenants by the Company. Under the terms of the Purchase Agreement, the Company had agreed to indemnify the initial purchasers against certain liabilities under the Securities Act. The 2020 Notes had not been registered under the Securities Act and could not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The net proceeds from the sale of the 2020 Notes was approximately $97.9 million, after deducting initial purchasers' discounts and commissions of approximately $1.6 million payable by the Company and estimated offering expenses of approximately $0.5 million payable by the Company. The Company used the net proceeds to make investments in accordance with the Company’s investment objectives and for general corporate purposes.
The 2020 Notes were issued pursuant to an Indenture, dated as of August 31, 2015 (the “2015 Indenture”), between the Company and U.S. Bank National Association, trustee (the “Trustee”). The 2020 Notes bore interest at a rate of 6.00% per year payable semi-annually on March 1 and September 1 of each year, commencing on March 1, 2016.
On August 14, 2020, the Company redeemed all outstanding 2020 Notes.
2022 Notes
On December 14, 2017, the Company entered into a Purchase Agreement (the “2022 Notes Purchase Agreement”) with Sandler O'Neill & Partners, L.P. (the "Initial Purchaser") relating to the Company's sale of $150.0 million aggregate principal amount of its 4.75% fixed rate notes due 2022 (the “2022 Notes”) to the Initial Purchaser in a private placement in reliance on Section 4(a)(2) of the Securities Act and for initial resale by the Initial Purchaser to qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A promulgated under the Securities Act and to institutional accredited investors under Rule 501(a)(1), (2), (3), or (7) under the Securities Act. The Company relied upon these exemptions from registration based in part on representations made by the Initial Purchaser. The 2022 Notes Purchase Agreement also includes customary representations, warranties, and covenants by the Company. Under the terms of the 2022 Notes Purchase Agreement, the Company has agreed to indemnify the Initial Purchaser against certain liabilities under the Securities Act. The 2022 Notes have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration. The net proceeds from the sale of the 2022 Notes was approximately $147.0 million, after deducting an offering price discount of approximately $0.8 million, as well as Initial Purchaser’s discounts and commissions of approximately $1.7 million and offering expenses of approximately $0.6 million, each payable by the Company. The Company used the net proceeds to repay outstanding indebtedness, to make investments in portfolio companies in accordance with its investment objectives, and for general corporate purposes.

52
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

The 2022 Notes were issued pursuant to the Indenture dated as of December 19, 2017 (the “2017 Indenture”), between the Company and the Trustee, and a Supplemental Indenture, dated as of December 19, 2017 (the “Supplemental Indenture”), between the Company and the Trustee. The 2022 Notes will mature on December 30, 2022, unless repurchased or redeemed in accordance with their terms prior to such date. The 2022 Notes bear interest at a rate of 4.75% per year payable semi-annually on June 30 and December 30 of each year, commencing on June 30, 2018. The 2022 Notes will be general unsecured obligations of the Company that rank senior in right of payment to all of the Company's existing and future indebtedness that is expressly subordinated in right of payment to the 2022 Notes. The 2022 Notes will rank equally in right of payment with all of the Company's existing and future senior liabilities that are not so subordinated, effectively junior to any of the Company's secured indebtedness (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness, and structurally junior to all existing and future indebtedness incurred by the Company's subsidiaries, financing vehicles, or similar facilities, including credit facilities entered into by the Company's wholly owned, special purpose financing subsidiaries.
The 2017 Indenture contains certain covenants, including covenants requiring the Company to (i) comply with the asset coverage requirements of the 1940 Act, whether or not it is subject to those requirements, and (ii) provide financial information to the holders of the 2022 Notes and the Trustee if the Company is no longer subject to the reporting requirements under the Securities Exchange Act of 1934, as amended. These covenants are subject to important limitations and exceptions that are described in the 2017 Indenture.
In addition, if a change of control repurchase event, as defined in the 2017 Indenture, occurs prior to maturity, holders of the 2022 Notes will have the right, at their option, to require the Company to repurchase for cash some or all of the 2022 Notes at a repurchase price equal to 100% of the principal amount of the 2022 Notes being repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date.
2023 Notes
On May 11, 2018, the Company entered into a Purchase Agreement (the “2023 Notes Purchase Agreement”) with the Initial Purchaser relating to the Company’s sale of $60.0 million aggregate principal amount of its 5.375% fixed rate notes due 2023 (the “2023 Notes”) to the Initial Purchaser in a private placement in reliance on Section 4(a)(2) of the Securities Act of 1933, and for initial resale by the Initial Purchaser to qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A promulgated under the Securities Act and to institutional accredited investors under Rule 501 (a)(1), (2), (3), or (7) under the Securities Act. The Company relied upon these exemptions from registration based in part on representations made by the Initial Purchaser. The 2023 Notes Purchase Agreement also includes customary representations, warranties, and covenants by the Company. Under the terms of the 2023 Notes Purchase Agreement, the Company has agreed to indemnify the Initial Purchaser against certain liabilities under the Securities Act. The 2023 Notes have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration. The net proceeds from the sale of the 2023 Notes were approximately $58.7 million, after deducting an offering price discount of approximately $0.3 million, as well as Initial Purchaser’s discounts and commissions of approximately $0.6 million and estimated offering expenses of approximately $0.4 million, each payable by the Company. The Company used the net proceeds to repay outstanding indebtedness, to make investments in portfolio companies in accordance with its investment objectives, and for general corporate purposes. The 2023 Notes were issued pursuant to the 2017 Indenture between the Company and The Trustee, and a Second Supplemental Indenture, dated as of May 16, 2018, between the Company and the Trustee. The 2023 Notes will mature on May 30, 2023, unless repurchased or redeemed in accordance with their terms prior to such date. The 2023 Notes bear interest at a rate of 5.375% per year payable semi-annually on May 30 and November 30 of each year, commencing on November 30, 2018. The 2023 Notes will be general unsecured obligations of the Company that rank senior in right of payment to all of the Company’s existing and future indebtedness that is expressly subordinated in right of payment to the 2023 Notes. The 2023 Notes will rank equally in right of payment with all of the Company’s existing and future senior liabilities that are not so subordinated, effectively junior to any of the Company’s secured indebtedness (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness, and structurally junior to all existing and future indebtedness incurred by the Company’s subsidiaries, financing vehicles, or similar facilities, including credit facilities entered into by the Company’s wholly owned, special purpose financing subsidiaries. The 2017 Indenture contains certain covenants, including covenants requiring the Company to (i) comply with the asset coverage requirements of the 1940 Act, whether or not it is subject to those requirements, and (ii) provide financial information to the holders of the 2023 Notes and the Trustee if the Company is no longer subject to the reporting requirements under the Securities Exchange Act of 1934, as amended. These covenants are subject to important limitations and exceptions that are described in the 2017 Indenture. In addition, if a change of control repurchase event, as defined in the 2017 Indenture, occurs prior to maturity, holders of the 2023 Notes will have the right, at their option, to require the Company to repurchase for cash some or all of the 2023 Notes at a repurchase price equal to 100% of the principal amount of the 2023 Notes being repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date.

53
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

2024 Notes
On December 3, 2019, the Company entered into a Purchase Agreement (the “2024 Notes Purchase Agreement”) with the Initial Purchaser relating to the Company’s sale of $100.0 million aggregate principal amount of its 4.85% fixed rate notes due 2024 (the “2024 Notes”) to the Initial Purchaser in a private placement in reliance on Section 4(a)(2) of the Securities Act of 1933, and for initial resale by the Initial Purchaser to qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A promulgated under the Securities Act and to institutional accredited investors under Rule 501 (a)(1), (2), (3), or (7) under the Securities Act. The Company relied upon these exemptions from registration based in part on representations made by the Initial Purchaser. The 2024 Notes Purchase Agreement also includes customary representations, warranties, and covenants by the Company. Under the terms of the 2024 Notes Purchase Agreement, the Company has agreed to indemnify the Initial Purchaser against certain liabilities under the Securities Act. The 2024 Notes have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration. The net proceeds from the sale of the 2024 Notes were approximately $98.4 million, after deducting the Initial Purchaser’s discounts and commissions of approximately $1.2 million and estimated offering expenses of approximately $0.4 million, each payable by the Company. The Company used the net proceeds to repay outstanding indebtedness, to make investments in portfolio companies in accordance with its investment objectives, and for general corporate purposes. The 2024 Notes were issued pursuant to the 2017 Indenture between the Company and The Trustee, and a Third Supplemental Indenture, dated as of December 5, 2019, between the Company and the Trustee. The 2024 Notes will mature on December 15, 2024, unless repurchased or redeemed in accordance with their terms prior to such date. The 2024 Notes bear interest at a rate of 4.85% per year payable semi-annually on June 15 and December 15 of each year, commencing on June 15, 2020. The 2024 Notes will be general unsecured obligations of the Company that rank senior in right of payment to all of the Company’s existing and future indebtedness that is expressly subordinated in right of payment to the 2024 Notes. The 2024 Notes will rank equally in right of payment with all of the Company’s existing and future senior liabilities that are not so subordinated, effectively junior to any of the Company’s secured indebtedness (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness, and structurally junior to all existing and future indebtedness incurred by the Company’s subsidiaries, financing vehicles, or similar facilities, including credit facilities entered into by the Company’s wholly owned, special purpose financing subsidiaries. The 2017 Indenture contains certain covenants, including covenants requiring the Company to (i) comply with the asset coverage requirements of the 1940 Act, whether or not it is subject to those requirements, and (ii) provide financial information to the holders of the 2024 Notes and the Trustee if the Company is no longer subject to the reporting requirements under the Securities Exchange Act of 1934, as amended. These covenants are subject to important limitations and exceptions that are described in the 2017 Indenture. In addition, if a change of control repurchase event, as defined in the 2017 Indenture, occurs prior to maturity, holders of the 2024 Notes will have the right, at their option, to require the Company to repurchase for cash some or all of the 2024 Notes at a repurchase price equal to 100% of the principal amount of the 2024 Notes being repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date.
The weighted average annualized interest cost for all borrowings for the nine months ended September 30, 2020 and 2019 was 3.73% and 4.67%, respectively. The average daily debt outstanding for the nine months ended September 30, 2020 and 2019 was $1.1 billion and $1.0 billion, respectively. The maximum debt outstanding for the nine months ended September 30, 2020 and 2019 was $1.5 billion and $1.2 billion, respectively.
The following table represents borrowings as of September 30, 2020:
 
 
Maturity Date
 
Total Aggregate Borrowing Capacity
 
Total Principal Outstanding
 
Less Deferred Financing Costs
 
Amount per Consolidated Statements of Assets and Liabilities
Wells Fargo Credit Facility
 
8/28/2025
 
$
300,000

 
$
225,000

 
$
(7,484
)
 
$
217,516

JPM Credit Facility
 
8/28/2023
 
300,000

 
240,000

 
(848
)
 
239,152

Citi Credit Facility
 
5/31/2022
 
400,000

 
119,500

 
(1,571
)
 
117,929

MassMutual Credit Facility
 
12/31/2025
 
100,000

 
—

 
(2,371
)
 
(2,371
)
2024 Notes
 
12/15/2024
 
100,000

 
98,997

 
(156
)
 
98,841

2023 Notes
 
5/30/2023
 
60,000

 
59,827

 
(502
)
 
59,325

2022 Notes
 
12/30/2022
 
150,000

 
149,629

 
(1,025
)
 
148,604

Totals
 
 
 
$
1,410,000

 
$
892,953

 
$
(13,957
)
 
$
878,996


54
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

    
The following table represents borrowings as of December 31, 2019:
 
 
Maturity Date
 
Total Aggregate Borrowing Capacity
 
Total Principal Outstanding
 
Less Deferred Financing Costs
 
Amount per Consolidated Statements of Assets and Liabilities
Wells Fargo Credit Facility
 
5/9/2023
 
$
600,000

 
$
436,652

 
$
(6,738
)
 
$
429,914

Citi Credit Facility
 
5/31/2022
 
400,000

 
250,500

 
(2,271
)
 
248,229

2024 Notes
 
12/15/2024
 
100,000

 
98,818

 
(184
)
 
98,634

2023 Notes
 
5/30/2023
 
60,000

 
59,778

 
(644
)
 
59,134

2022 Notes
 
12/30/2022
 
150,000

 
149,505

 
(1,367
)
 
148,138

2020 Notes
 
9/1/2020
 
100,000

 
99,789

 
(84
)
 
99,705

Totals
 
 
 
$
1,410,000

 
$
1,095,042

 
$
(11,288
)
 
$
1,083,754


The following table represents interest and debt fees for the three and nine months ended September 30, 2020:
 
Three months ended September 30, 2020
 
Nine months ended September 30, 2020
 
Interest Rate
 
Non-Usage Rate
 
Interest Expense
 
Deferred Financing Costs (6)
 
Other Fees (7)
 
Interest Rate
 
Non-Usage Rate
 
Interest Expense
 
Deferred Financing Costs (6)
 
Other Fees (7)
Wells Fargo Credit Facility
(1) 
 
(2) 
 
$
2,967

 
$
635

 
$
97

 
(1) 
 
(2) 
 
$
10,899

 
$
1,634

 
$
365

JPM Credit Facility
(3) 
 
(4) 
 
681

 
27

 
28

 
(3) 
 
(4) 
 
681

 
27

 
28

Citi Credit Facility
L+1.60%
 
0.50%
 
751

 
236

 
344

 
L+1.60%
 
0.50%
 
5,450

 
702

 
636

MassMutual Credit Facility
(5) 
 
0.50%
 
—

 
101

 
158

 
(5) 
 
0.50%
 
—

 
101

 
158

2024 Notes
4.85%
 
n/a
 
1,272

 
9

 
8

 
4.85%
 
n/a
 
3,816

 
28

 
34

2023 Notes
5.38%
 
n/a
 
823

 
48

 
11

 
5.38%
 
n/a
 
2,468

 
142

 
11

2022 Notes
4.75%
 
n/a
 
1,823

 
115

 
—

 
4.75%
 
n/a
 
5,468

 
342

 
9

2020 Notes
6.00%
 
n/a
 
754

 
21

 
—

 
6.00%
 
n/a
 
3,895

 
84

 
8

Totals
 
 
 
 
$
9,071

 
$
1,192

 
$
646

 
 
 
 
 
$
32,677

 
$
3,060

 
$
1,249

______________
(1) Prior to an amendment on July 7, 2020, the Wells Fargo Credit Facility had an interest rate priced at one-month LIBOR, with no LIBOR floor, plus a spread ranging between 1.65% and 2.50% per annum, depending on the composition of the portfolio of loans owned. From July 7, 2020 until August 28, 2020, the Wells Fargo Credit Facility had an interest rate priced at one-month LIBOR, with no LIBOR floor, plus a spread of 2.75% per annum. From August 28, 2020 through September 30, 2020, the Wells Fargo Credit Facility had an interest rate priced at three-month LIBOR, with a LIBOR floor of zero, plus a spread calculated based upon the composition of the loans in the collateral pool, which will not exceed 2.75% per annum.
(2) The non-usage fee per annum is 0.50% for the first 25% of the unused balance and 2.0% for the portion of the unused balance that exceeds 25%.
(3) Interest rate is priced at three-month LIBOR, with a LIBOR floor of zero, plus a spread of 2.75% per annum.
(4) The non-usage fee per annum is 0.50% until August 28, 2021, where the non-usage fee per annum will be 0.75% on any principal amount unused.
(5) Interest rate is priced at three-month LIBOR, with a LIBOR floor of 0.75%, plus a spread of 5.0% per annum.

55
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

(6) Amortization of deferred financing costs.
(7) Includes non-usage fees and custody fees.
The following table represents interest and debt fees for the three and nine months ended September 30, 2019:
 
Three months ended September 30, 2019
 
Nine months ended September 30, 2019
 
Interest Rate
 
Non-Usage Rate
 
Interest Expense
 
Deferred Financing Costs (3)
 
Other Fees (4)
 
Interest Rate
 
Non-Usage Rate
 
Interest Expense
 
Deferred Financing Costs (3)
 
Other Fees (4)
Wells Fargo Credit Facility
(1) 
 
(2) 
 
$
5,193

 
$
494

 
$
214

 
(1) 
 
(2) 
 
$
14,678

 
$
1,461

 
$
952

Citi Credit Facility
L+1.60%
 
0.50%
 
3,454

 
230

 
98

 
L+1.60%
 
0.50%
 
10,133

 
629

 
366

2023 Notes
5.38%
 
n/a
 
823

 
47

 
9

 
5.38%
 
n/a
 
2,467

 
141

 
9

2022 Notes
4.75%
 
n/a
 
1,823

 
115

 
2

 
4.75%
 
n/a
 
5,467

 
341

 
7

2020 Notes
6.00%
 
n/a
 
1,596

 
32

 
1

 
6.00%
 
n/a
 
4,753

 
94

 
7

Totals
 
 
 
 
$
12,889

 
$
918

 
$
324

 
 
 
 
 
$
37,498

 
$
2,666

 
$
1,341

_____________
(1) Interest rate is priced at one month's LIBOR with no LIBOR floor, plus a spread ranging between 1.65% and 2.50% per annum, depending on the composition of the portfolio of loans owned.
(2) The non-usage fee per annum is 0.50% for the first 25% of the unused balance and 2.0% for the portion of the unused balance that exceeds 25%, except for the period from March 15, 2019 through June 15, 2019, where the non-usage fee per annum was 0.50% on any principal amount unused.
(3) Amortization of deferred financing costs.
(4) Includes non-usage fees, custody fees, and trustee fees.    
The Company is required to disclose the fair value of financial instruments for which it is practicable to estimate fair value. The fair value of short-term financial instruments such as cash and cash equivalents, due to affiliates, and accounts payable approximate their carrying value on the accompanying consolidated statements of assets and liabilities due to their short-term nature. The fair value of the Company's 2020 Notes, 2022 Notes, 2023 Notes, and 2024 Notes are derived from market indications provided by Bloomberg Finance L.P. at September 30, 2020 and December 31, 2019.
At September 30, 2020, the carrying amount of the Company's secured borrowings approximated their fair value. The fair values of the Company's debt obligations are determined in accordance with ASC 820, which defines fair value in terms of the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. The fair value of the Company's borrowings is estimated based upon market interest rates for the Company's own borrowings or entities with similar credit risk, adjusted for nonperformance risk, if any. As of September 30, 2020 and December 31, 2019, the Company's borrowings would be deemed to be Level 3, as defined in Note 3 - Fair Value of Financial Instruments.
The fair values of the Company’s remaining financial instruments that are not reported at fair value on the accompanying consolidated statements of assets and liabilities are reported below:

56
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

 
Level
 
Carrying Amount at September 30, 2020
 
Fair Value at September 30, 2020
Wells Fargo Credit Facility
3
 
$
225,000

 
$
225,000

JPM Credit Facility
3
 
240,000

 
240,000

Citi Credit Facility
3
 
119,500

 
119,500

MassMutual Credit Facility
3
 
—

 
—

2024 Notes
3
 
98,997

 
99,782

2023 Notes
3
 
59,827

 
62,042

2022 Notes
3
 
149,629

 
154,838

 
 
 
$
892,953

 
$
901,162

 
Level
 
Carrying Amount at December 31, 2019
 
Fair Value at December 31, 2019
Wells Fargo Credit Facility
3
 
$
436,652

 
$
436,652

Citi Credit Facility
3
 
250,500

 
250,500

2024 Notes
3
 
98,818

 
99,722

2023 Notes
3
 
59,778

 
60,721

2022 Notes
3
 
149,505

 
151,937

2020 Notes
3
 
99,789

 
101,389

 
 
 
$
1,095,042

 
$
1,100,921


Note 6 — Derivatives
Foreign Currency
The Company may enter into forward foreign currency contracts from time to time to facilitate settlement of purchases and sales of investments denominated in foreign currencies or to help mitigate the impact that an adverse change in foreign exchange rates would have on the value of the Company's investments denominated in foreign currencies. A forward foreign currency contract is a commitment to purchase or sell a foreign currency at a future date (usually the security transaction settlement date) at a negotiated forward rate. These contracts are marked-to-market by recognizing the difference between the contract exchange rate and the current market rate as unrealized appreciation or depreciation. Realized gains or losses are recognized when contracts are settled. The Company's forward foreign currency contracts generally have terms of approximately three months. The volume of open contracts at the end of each reporting period is reflective of the typical volume of transactions during each calendar quarter. Risks may arise as a result of the potential inability of the counterparties to meet the terms of their contracts. The Company attempts to limit this risk by dealing with creditworthy counterparties.
At September 30, 2020 and December 31, 2019, the forward foreign currency contracts were classified within Level 2 of the fair value hierarchy. The foreign currency forward contract held as of September 30, 2020, was subject to ISDA Master Agreements or similar agreements. The foreign currency forward contract held as of December 31, 2019, was subject to ISDA Master Agreements or similar agreements.
The Company is operated by a person who has claimed an exclusion from the definition of the "commodity pool operator" under the Commodity Exchange Act, and, therefore, who is not subject to registration or regulation as a pool operator under such Act.

57
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Note 7 — Commitments and Contingencies
Commitments
In the ordinary course of business, the Company may enter into future funding commitments. As of September 30, 2020, the Company had unfunded commitments on delayed draw term loans of $21.2 million (including $18.7 million of non-discretionary commitments and $2.5 million of discretionary commitments), unfunded commitments on revolver term loans of $39.0 million, and unfunded equity capital discretionary commitments of $11.1 million. As of December 31, 2019, the Company had unfunded commitments on delayed draw term loans of $24.9 million (including $21.8 million of non-discretionary commitments and $3.1 million of discretionary commitments), unfunded commitments on revolver term loans of $28.0 million, and unfunded equity capital discretionary commitments of $21.4 million. The Company maintains sufficient cash on hand and available borrowings to fund such unfunded commitments.



58
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

As of September 30, 2020, the Company's unfunded commitments consisted of the following:
September 30, 2020
Portfolio Company Name
 
Investment Type
 
Commitment Type
 
Total Commitment
 
Remaining Commitment
AMI Entertainment Network, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
$
1,234

 
$
1,234

Arch Global Precision, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
2,005

 
2,005

Arch Global Precision, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,008

 
1,008

CCW, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,576

 
200

CRS-SPV, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
224

 
162

Health Plan One, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,458

 
1,458

ICR Operations, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,753

 
1,376

Ideal Tridon Holdings, Inc.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
80

 
34

Ideal Tridon Holdings, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,810

 
1,686

Integral Ad Science, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,085

 
1,085

Integrated Global Services, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,028

 
406

KMTEX, LLC (1)
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
2,678

 
2,544

Labrie Environmental Group, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
4,913

 
4,913

Lakeview Health Holdings, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
325

 
186

MED Parentco, LP
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
1,429

 
429

Midwest Can Company, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,543

 
1,543

Miller Environmental Group, Inc.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
1,131

 
1,131

Miller Environmental Group, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,324

 
927

Mintz Group, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
1,344

 
1,344

Mintz Group, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
630

 
630

Muth Mirror Systems, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,299

 
974

New Amsterdam Software Bidco, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
1,790

 
1,790

Norvax, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,152

 
1,152

Olaplex, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,908

 
954

Pike Corp.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
6,115

 
6,115

Planet Equity Group, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,325

 
1,162

PT Network, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,316

 
1,316

Questex, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,584

 
1,292

RE Investment Company, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
5,695

 
5,695

Reddy Ice Corp.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
2,509

 
1,234

Reddy Ice Corp.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,762

 
1,762

REP TEC Intermediate Holdings, Inc.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
2,223

 
2,223

REP TEC Intermediate Holdings, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
741

 
741

Safety Products/JHC Acquisition Corp.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
2,164

 
1,214

SCIH Salt Holdings, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
3,746

 
3,237

Subsea Global Solutions, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
963

 
770

Tap Rock Resources, LLC (1)
 
Equity/Other
 
Equity
 
29,470

 
11,114

Tillamook Country Smoker, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,696

 
135

University of St. Augustine Acquisition Corp.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,615

 
2,615

WMK, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
1,919

 
1,562

Total
 
 
 
 
 
$
106,570

 
$
71,358

_____________
(1) The commitment related to this investment is discretionary.


59
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

As of December 31, 2019, the Company's unfunded commitments consisted of the following:
December 31, 2019
Portfolio Company Name
 
Investment Type
 
Commitment Type
 
Total Commitment
 
Remaining Commitment
AMI Entertainment Network, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
$
1,234

 
$
1,234

Arch Global Precision, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
1,071

 
1,071

Arch Global Precision, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,008

 
1,008

CCW, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,500

 
200

CDHA Holdings, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
7,580

 
7,027

CDHA Holdings, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,264

 
834

Corfin Industries, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
956

 
956

CRS-SPV, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
224

 
162

Florida Food Products, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,647

 
231

ICR Operations, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,753

 
2,655

Ideal Tridon Holdings, Inc.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
80

 
34

Ideal Tridon Holdings, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,810

 
2,649

Integral Ad Science, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,085

 
1,085

Lakeview Health Holdings, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
315

 
186

MED Parentco, LP
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
1,437

 
1,131

Midwest Can Company, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
547

 
547

Miller Environmental Group, Inc.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
1,131

 
1,131

Miller Environmental Group, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,324

 
1,324

Muth Mirror Systems, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,299

 
1,299

New Amsterdam Software Bidco, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
1,790

 
1,790

Norvax, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,152

 
1,152

ORG Chemical Holdings, LLC (1)
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
6,503

 
3,083

Planet Equity Group, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,325

 
2,325

PT Network, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,316

 
1,316

Questex, Inc.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,584

 
1,895

Reddy Ice Corp.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
2,518

 
2,518

Reddy Ice Corp.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,762

 
1,762

Safety Products/JHC Acquisition Corp.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
2,171

 
1,214

SitusAMC Holdings Corp.
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
752

 
752

Subsea Global Solutions, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
4,744

 
2,352

Subsea Global Solutions, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
963

 
575

Tap Rock Resources, LLC (1)
 
Equity/Other
 
Equity
 
42,100

 
21,428

Tillamook Country Smoker, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
1,618

 
539

University of St. Augustine Acquisition Corp.
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,615

 
2,615

Vantage Mobility International, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
196

 
196

WMK, LLC
 
Senior Secured First Lien Debt
 
Delayed draw term loan
 
4,528

 
2,618

WMK, LLC
 
Senior Secured First Lien Debt
 
Revolver term loan
 
2,618

 
1,484

Total
 
 
 
 
 
$
111,520

 
$
74,378

_____________
(1) The commitment related to this investment is discretionary.
Litigation and Regulatory Matters
In the ordinary course of business, the Company may become subject to litigation, claims, and regulatory matters. The Company has no knowledge of material legal or regulatory proceedings pending or known to be contemplated against the Company at this time.

60
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Indemnifications
In the ordinary course of its business, the Company may enter into contracts or agreements that contain indemnifications or warranties. Future events could occur that lead to the execution of these provisions against the Company. Based on its history and experience, management feels that the likelihood of such an event is remote.
Note 8 — Economic Dependency
Under various agreements, the Company has engaged or will engage the Adviser and its affiliates to provide certain services that are essential to the Company, including asset management services, asset acquisition and disposition decisions, the sale of shares of the Company’s common stock available for issuance, as well as other administrative responsibilities for the Company including accounting services and investor relations.
As a result of these relationships, the Company is dependent upon the Adviser and its affiliates. In the event that these companies were unable to provide the Company with the respective services, the Company would be required to find alternative providers of these services.
Note 9 — Common Stock
On August 25, 2011, the Company had raised sufficient funds to break escrow on its IPO. On July 1, 2014, the Company's registration statement on Form N-2 (File No.333-193241) for its Follow-on was declared effective by the SEC. Simultaneously with the effectiveness of the registration statement of the Follow-on, the Company's IPO terminated. Through September 30, 2020, the Company issued 228.6 million shares of common stock for gross proceeds of $2.3 billion, including the shares purchased by an affiliate of BSP and shares issued under the Company's DRIP. Following the time the Company's updated registration statement was declared effective on June 30, 2015, the Company issued shares for subscription agreements that had been accepted through that date. The Company suspended the DRIP from March 29, 2020 through June 26, 2020. While the DRIP was suspended, participants and all other holders of the Company's common stock received distributions paid by the Company in cash. From inception of the Company's DRIP plan to September 30, 2020, the Company had repurchased 27.9 million shares of common stock through its share repurchase program for payments of $239.7 million. As of December 31, 2019, the Company had repurchased 25.6 million shares of common stock for payments of $222.2 million. Amounts include additional shares tendered for death and disability as permitted.
On March 31, 2020, the Company issued in a private placement an aggregate amount of 9,532,062 newly issued shares of its common stock at a price of $5.77 per share for aggregate cash proceeds of $55.0 million. On April 30, 2020, the Company issued in a private placement an aggregate amount of 693,240 newly issued shares of its common stock at a price of $5.77 per share for aggregate cash proceeds of $4.0 million.
The following table reflects the common stock activity for the nine months ended September 30, 2020:
 
 
Shares
 
Value
Shares Sold
 
10,225,302

 
$
59,000

Shares Issued through DRIP
 
2,516,359

 
17,657

Share Repurchases
 
(2,255,193
)
 
(17,476
)
 
 
10,486,468

 
$
59,181

The following table reflects the common stock activity for the year ended December 31, 2019:
 
 
Shares
 
Value
Shares Sold
 
—

 
$
—

Shares Issued through DRIP
 
4,373,786

 
34,905

Share Repurchases
 
(4,490,328
)
 
(36,286
)
 
 
(116,542
)
 
$
(1,381
)


61
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

The following table reflects the stockholders' equity activity for the nine months ended September 30, 2020:
 
Common stock - shares
 
Common stock - par
 
Additional paid in capital
 
Total distributable earnings (loss)
 
Total Stockholders' Equity
Balance as of December 31, 2019
190,207,517

 
$
190

 
$
1,847,312

 
$
(384,819
)
 
$
1,462,683

Net investment income
—

 
—

 
—

 
25,558

 
25,558

Net realized loss from investment transactions
—

 
—

 
—

 
(13,985
)
 
(13,985
)
Net change in unrealized depreciation on investments and foreign exchange currency contracts, net of change in deferred taxes
—

 
—

 
—

 
(205,292
)
 
(205,292
)
Issuance of common stock, net of issuance costs
9,532,062

 
10

 
54,990

 
—

 
55,000

Repurchases
(2,134,416
)
 
(2
)
 
(16,539
)
 
—

 
(16,541
)
Distributions to stockholders
—

 
—

 
—

 
(30,727
)
 
(30,727
)
Reinvested dividends
1,046,828

 
1

 
8,112

 
—

 
8,113

Balance as of March 31, 2020
198,651,991

 
$
199

 
$
1,893,875

 
$
(609,265
)
 
$
1,284,809

Net investment income
—

 
—

 
—

 
20,433

 
20,433

Net realized loss from investment transactions
—

 
—

 
—

 
(55,318
)
 
(55,318
)
Net change in unrealized appreciation on investments and foreign exchange currency contracts, net of change in deferred taxes
—

 
—

 
—

 
65,777

 
65,777

Issuance of common stock, net of issuance costs
693,240

 
—

 
4,000

 
—

 
4,000

Repurchases
(95,356
)
 
—

 
(739
)
 
—

 
(739
)
Distributions to stockholders
—

 
—

 
—

 
(19,809
)
 
(19,809
)
Reinvested dividends
744,810

 
1

 
4,818

 
—

 
4,819

Balance as of June 30, 2020
199,994,685

 
$
200

 
$
1,901,954

 
$
(598,182
)
 
$
1,303,972

Net investment income
—

 
—

 
—

 
20,320

 
20,320

Net realized loss from investment transactions
—

 
—

 
—

 
(36,756
)
 
(36,756
)
Net change in unrealized appreciation on investments and foreign exchange currency contracts, net of change in deferred taxes
—

 
—

 
—

 
74,410

 
74,410

Issuance of common stock, net of issuance costs
—

 
—

 
—

 
—

 
—

Repurchases
(25,421
)
 
—

 
(196
)
 
—

 
(196
)
Distributions to stockholders
—

 
—

 
—

 
(19,992
)
 
(19,992
)
Reinvested dividends
724,721

 
1

 
4,724

 
—

 
4,725

Balance as of September 30, 2020
200,693,985

 
$
201

 
$
1,906,482

 
$
(560,200
)
 
$
1,346,483


62
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

The following table reflects the stockholders' equity activity for the nine months ended September 30, 2019:
 
Common stock - shares
 
Common stock - par
 
Additional paid in capital
 
Total distributable earnings (loss)
 
Net assets attributable to non-controlling interest
 
Total Stockholders' Equity
Balance as of December 31, 2018
190,324,059

 
$
190

 
$
1,811,970

 
$
(323,127
)
 
$
3,686

 
$
1,492,719

Net investment income
—

 
—

 
—

 
27,164

 
2

 
27,166

Net realized loss from investment transactions
—

 
—

 
—

 
(1,911
)
 
—

 
(1,911
)
Net change in unrealized appreciation on investments and foreign exchange currency contracts, net of change in deferred taxes
—

 
—

 
—

 
30,579

 
1,292

 
31,871

Repurchases
(2,241,001
)
 
(2
)
 
(18,374
)
 
—

 
—

 
(18,376
)
Distributions to stockholders
—

 
—

 
—

 
(30,441
)
 
—

 
(30,441
)
Reinvested dividends
1,087,268

 
1

 
8,915

 
—

 
—

 
8,916

Balance as of March 31, 2019
189,170,326

 
$
189

 
$
1,802,511

 
$
(297,736
)
 
$
4,980

 
$
1,509,944

Net investment income
—

 
—

 
—

 
27,092

 
7

 
27,099

Net realized gain from investment transactions
—

 
—

 
—

 
2,523

 
—

 
2,523

Net change in unrealized appreciation on investments and foreign exchange currency contracts, net of change in deferred taxes
—

 
—

 
—

 
3,549

 
1,725

 
5,274

Repurchases
(25,215
)
 
—

 
(206
)
 
—

 
—

 
(206
)
Distributions to stockholders
—

 
—

 
—

 
(30,779
)
 
—

 
(30,779
)
Reinvested dividends
1,147,112

 
1

 
9,021

 
—

 
—

 
9,022

Balance as of June 30, 2019
190,292,223

 
$
190

 
$
1,811,326

 
$
(295,351
)
 
$
6,712

 
$
1,522,877

Net investment income
—

 
—

 
—

 
27,940

 
—

 
27,940

Net realized loss from investment transactions
—

 
—

 
—

 
(38,437
)
 
—

 
(38,437
)
Net change in unrealized depreciation on investments and foreign exchange currency contracts, net of change in deferred taxes
—

 
—

 
—

 
(1,553
)
 
—

 
(1,553
)
Acquisition of non-controlling interest
—

 
—

 
1,281

 
—

 
(6,712
)
 
(5,431
)
Repurchases
(2,197,309
)
 
(2
)
 
(17,489
)
 
—

 
—

 
(17,491
)
Distributions to stockholders
—

 
—

 
—

 
(31,137
)
 
—

 
(31,137
)
Reinvested dividends
1,086,047

 
1

 
8,648

 
—

 
—

 
8,649

Balance as of September 30, 2019
189,180,961

 
$
189

 
$
1,803,766

 
$
(338,538
)
 
$
—

 
$
1,465,417


63
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Note 10 — Share Repurchase Program
The Company intends to conduct annual tender offers pursuant to its share repurchase program (“SRP”). The Company’s Board of Directors considers the following factors in making its determination regarding whether to cause the Company to offer to repurchase shares and under what terms:
•the effect of such repurchases on the Company's qualification as a RIC (including the consequences of any necessary asset sales);
•the liquidity of the Company's assets (including fees and costs associated with disposing of assets);
•the Company's investment plans and working capital requirements;
•the relative economies of scale with respect to the Company's size;
•the Company's history in repurchasing shares or portions thereof;
•the condition of the securities markets.
On June 26, 2020, the Company's Board of Directors amended the Company's SRP. The Company intends to conduct tender offers on an annual basis, instead of on a semi-annual basis as was done previously. The Company intends to continue to limit the number of shares to be repurchased in any calendar year to the lesser of (i) 10% of the weighted average number of shares outstanding in the prior calendar year or (ii) the number of shares of common stock the Company is able to repurchase with the proceeds received from the sale of shares of common stock under the DRIP during the relevant redemption period. In addition, in the event of a stockholder’s death or disability, the Company may, in its sole discretion, accept up to the full amount tendered by such stockholder of the current net asset value per share. Any repurchases of shares made in connection with a stockholder’s death or disability may be included within the overall limitation imposed on tender offers during the relevant redemption period, which provides that the Company may limit the number of shares to be repurchased during any redemption period to the number of shares of common stock the Company is able to repurchase with the proceeds received from the sale of shares of common stock under the DRIP during such redemption period. The Company's eight most recent tender offers were oversubscribed.
Offer Date
 
Repurchase Date
 
Shares Tendered
 
Shares Repurchased
 
Repurchase Price Per Share
 
Aggregate Consideration for Repurchased Shares (in thousands)
June 18, 2019
 
July 23, 2019
 
31,263,410

 
2,199,337

 
$
7.96

 
$
17,506.70

December 17, 2019
 
January 27, 2020
 
37,389,681

 
2,115,276

 
$
7.75

 
$
16,698.90

Share amounts in the table above represent amounts filed in the tender offer.
Note 11 — Earnings Per Share
Basic earnings per share is computed by dividing earnings available to common stockholders by the weighted average number of shares outstanding during the period. Other potentially dilutive shares, and the related impact to earnings, are considered when calculating earnings per share on a diluted basis. The Company had no potentially dilutive securities for the periods ended September 30, 2020 and 2019.
The following information sets forth the computation of the weighted average basic and diluted net increase in net assets per share resulting from operations for the three and nine months ended September 30, 2020 and 2019.
 
For the three months ended September 30,
 
For the nine months ended September 30,
 
2020
 
2019
 
2020
 
2019
Basic and diluted
 
 
 
 
 
 
 
Net increase (decrease) in net assets resulting from operations
$
57,974

 
$
(12,050
)
 
$
(104,853
)
 
$
76,946

Weighted average common shares outstanding
199,984,106

 
190,060,251

 
196,404,920

 
189,973,074

Net increase (decrease) in net assets resulting from operations per share
$
0.29

 
$
(0.06
)
 
$
(0.53
)
 
$
0.41


64
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Note 12 — Distributions
For the period from January 1, 2019 to March 29, 2020, the Company’s Board of Directors had authorized, and had declared, cash distributions payable on a monthly basis to stockholders of record at a distribution rate of $0.00178082 per day, which is equivalent to approximately $0.65 annually, per share of common stock, except for 2020 where the daily distribution rate was $0.00177596 per day to accurately reflect 2020 being a leap year. Effective April 21, 2020, the Board of Directors of the Company approved a transition in the timing of its distributions to holders of the Company's common stock from a monthly to a quarterly basis. On June 26, 2020, the Board declared a regular quarterly cash dividend of $0.10 per share of the Company's common stock, payable on July 6, 2020 to stockholders of record as of June 30, 2020. On September 25, 2020, the Board declared a regular quarterly cash dividend of $0.10 per share of the Company's common stock, payable on October 1, 2020 to stockholders of record as of September 30, 2020.
The amount of each such distribution is subject to the discretion of the Board of Directors and applicable legal restrictions related to the payment of distributions. The Company calculates each stockholder’s specific distribution amount for the quarter using record and declaration dates. The distributions are payable by the fifth day following each record date.
As of September 30, 2020 and December 31, 2019, the Company had accrued $15.2 million and $10.5 million, respectively, in stockholder distributions that were unpaid.
Note 13 — Income Tax Information and Distributions to Stockholders
The Company has elected to be treated for federal income tax purposes as a RIC under the Code. Generally, a RIC is exempt from federal income taxes if it meets certain quarterly asset diversification requirements, annual income tests, and distributes to stockholders its ‘‘investment company taxable income,’’ as defined in the Code, each taxable year. Distributions declared prior to the filing of the previous year's tax return and paid up to one year after the previous tax year can be carried back to the prior tax year for determining the distributions paid in such tax year. The Company intends to make sufficient distributions to maintain its RIC status each year. The Company may also be subject to federal excise taxes of 4%.
A RIC is limited in its ability to deduct expenses in excess of its “investment company taxable income” (which is, generally, ordinary income plus net realized short-term capital gains in excess of net realized long-term capital losses). If the Company's expenses in a given taxable year exceed gross taxable income (e.g., as the result of large amounts of equity-based compensation), it would incur a net operating loss for that year. However, a RIC is not permitted to carry forward net operating losses to subsequent taxable years and such net operating losses do not pass through to the RIC’s stockholders. In addition, deductible expenses can be used only to offset investment company taxable income, not net capital gain. A RIC may not use any net capital losses (that is, realized capital losses in excess of realized capital gains) to offset the RIC’s investment company taxable income, but may carry forward such net capital losses, and use them to offset capital gains indefinitely. Due to these limits on the deductibility of expenses and net capital losses, the Company may for tax purposes have aggregate taxable income for several taxable years that it is required to distribute and that is taxable to stockholders even if such taxable income is greater than the aggregate net income the Company actually earned during those taxable years. Such required distributions may be made from the Company cash assets or by liquidation of investments, if necessary. The Company may realize gains or losses from such liquidations. In the event the Company realizes net capital gains from such transactions, the Company may make a larger capital gain distribution than it would have made in the absence of such transactions.
Depending on the level of taxable income earned in a tax year, for excise tax purposes the Company may choose to carry forward taxable income in excess of current year distributions into the next tax year and incur a 4% U.S. federal 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 distributions, the Company accrues excise tax, if any, on estimated excess taxable income as taxable income is earned.
The Company did not have any uncertain tax positions that met the recognition or measurement criteria of ASC 740-10-25, Income Taxes (“ASC Topic 740”), nor did the Company have any unrecognized tax benefits as of the periods presented herein. The Company's 2019 tax year and 2018, 2017, and 2016 federal tax returns remain subject to examination by the Internal Revenue Service.
As of September 30, 2020, the Company had a deferred tax asset of $3.4 million and a deferred tax liability of $(2.3) million. Given the losses generated by certain entities, deferred tax assets have been offset by valuation allowances of $3.4 million. As of December 31, 2019, the Company had a deferred tax asset of $1.5 million and a deferred tax liability of $(3.1) million. Given the losses generated by certain entities, deferred tax assets have been offset by valuation allowances of $1.5 million.

65
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

The deferred tax asset valuation allowance has been determined pursuant to the provisions of ASC Topic 740, including the Company's estimation of future taxable income, if necessary, and is adequate to reduce the total deferred tax asset to an amount that will more likely than not be realized.
Note 14 — Financial Highlights
The following is a schedule of financial highlights for the nine months ended September 30, 2020 and 2019:
 
For the nine months ended September 30,
 
2020
 
2019
Per share data:
 
 
 
Net asset value, beginning of period
$
7.69

 
$
7.82

Results of operations (1)
 
 
 
        Net investment income
0.34

 
0.43

Net realized and unrealized loss, net of change in deferred taxes
(0.87
)
 
(0.01
)
Net change in unrealized depreciation attributable to non-controlling interests
—

 
(0.01
)
Net increase (decrease) in net assets resulting from operations
(0.53
)
 
0.41

Stockholder distributions (2)
 
 
 
Distributions from net investment income
(0.36
)
 
(0.49
)
Net decrease in net assets resulting from stockholder distributions
(0.36
)
 
(0.49
)
Capital share transactions
 
 
 
        Issuance of common stock (8)
(0.05
)
 
—

Acquisition of non-controlling interest
—

 
0.01

Net increase (decrease) in net assets resulting from capital share transactions
(0.05
)
 
0.01

Other (9)
(0.04
)
 
—

Net asset value, end of period
$
6.71

 
$
7.75

Shares outstanding at end of period
200,693,985

 
189,180,961

Total return (4)
(8.16
)%
 
5.19
%
Ratio/Supplemental data:
 
 
 
Total net assets, end of period
1,346,483

 
1,465,417

Ratio of net investment income to average net assets (3)(6)
6.56
 %
 
7.90
%
Ratio of total expenses to average net assets (3)(6)(7)
7.54
 %
 
8.95
%
Portfolio turnover rate (5)
21.19
 %
 
22.83
%
______________
(1) 
The per share data was derived by using the weighted average shares outstanding during the period.
(2) 
The per share data for distributions reflects the actual amount of distributions declared per share during the period.
(3) 
Ratios are annualized, except for incentive fees.
(4) 
Total return is calculated assuming a purchase of shares of common stock at the current net asset value on the first day and a sale at the current net asset value on the last day of the periods reported. Distributions, if any, are assumed for purposes of this calculation to be reinvested at prices obtained under the DRIP.
(5) 
Portfolio turnover rate is calculated using the lesser of year-to-date purchases or sales over the average of the invested assets at fair value. Portfolio turnover rate is not annualized.
(6) 
There were no offering costs during the period.
(7) 
Ratio of total expenses to average net assets is calculated using total operating expenses, including income tax expense over average net assets.
(8) 
The issuance of common stock on a per share basis reflects the incremental net asset value changes as a result of the issuance of shares of common stock.

66
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

(9) 
Represents the impact of calculating certain per share amounts based on weighted average shares outstanding during the period and certain per share amounts based on shares outstanding as of period end.

Note 15 – Schedules of Investments and Advances to Affiliates
The following table presents the Schedule of Investments and Advances to Affiliates as of September 30, 2020:
Portfolio Company (1)
 
Type of Asset
 
Industry
 
Amount of dividends and interest included in income
 
Beginning Fair Value at December 31, 2019
 
Gross additions*
 
Gross reductions**
 
Realized Gain/(Loss)
 
Change in Unrealized Gain (Loss) (4)
 
Fair Value at September 30, 2020
Control Investments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Capstone Nutrition (fka Integrity Nutraceuticals) - L+12.50% (15.08%), 9/25/2020 (2) (5) (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
$
—

 
$
—

 
$
504

 
$
—

 
$
(504
)
 
$
—

 
$
—

CRD Holdings, LLC - 9.00% (2) (7)
 
Equity/Other
 
Energy
 
2,071

 
28,943

 
—

 
(6,529
)
 
—

 
641

 
23,055

CRS-SPV, Inc. (2) (7) (8)
 
Equity/Other
 
Industrials
 
—

 
2,221

 
—

 
—

 
—

 
(828
)
 
1,393

CRS-SPV, Inc. - L+4.50% (5.50%), 3/8/2021 (2) (7)
 
Senior Secured First Lien Debt
 
Industrials
 
3

 
62

 
—

 
—

 
—

 
—

 
62

Kahala Ireland OpCo Designated Activity Company - L+8.00% (13.00%), 12/22/2028 (2) (3) (7)
 
Senior Secured First Lien Debt
 
Transportation
 
6,222

 
105,549

 
—

 
(79,000
)
 
—

 
—

 
26,549

Kahala Ireland OpCo Designated Activity Company (2) (3) (7) (8)
 
Equity/Other
 
Transportation
 
—

 
57,226

 
—

 
—

 
—

 
(5,274
)
 
51,952

Kahala Ireland OpCo Designated Activity Company (2) (3) (7) (8)
 
Equity/Other
 
Transportation
 
—

 
3,250

 
2

 
—

 
—

 
(2
)
 
3,250

Kahala US OpCo, LLC - 13.00% (2) (3) (7) (8)
 
Equity/Other
 
Transportation
 
—

 
—

 
—

 
—

 
—

 
—

 
—

KMTEX, LLC - P+3.00% (6.25%), 6/16/2025 (2) (6) (7)
 
Senior Secured First Lien Debt
 
Chemicals
 
13

 
—

 
816

 
—

 
—

 
—

 
816

KMTEX, LLC - P+3.00% (6.25%), 6/16/2025 (2) (6) (7)
 
Senior Secured First Lien Debt
 
Chemicals
 
68

 
—

 
3,179

 
—

 
—

 
—

 
3,179

KMTEX, LLC - P+3.00% (6.25%), 6/16/2025 (2) (6) (7)
 
Senior Secured First Lien Debt
 
Chemicals
 
—

 
—

 
134

 
—

 
—

 
—

 
134

KMTEX, LLC (2) (7) (8)
 
Equity/Other
 
Chemicals
 
—

 
—

 
—

 
—

 
—

 
—

 
—

KMTEX, LLC (2) (7) (8)
 
Equity/Other
 
Chemicals
 
—

 
—

 
2,793

 
—

 
—

 
3,658

 
6,451

MGTF Holdco, LLC (2) (7) (8)
 
Equity/Other
 
Media/Entertainment
 
—

 
—

 
—

 
—

 
—

 
—

 
—

MGTF Radio Company, LLC - L+6.00% (7.00%), 4/1/2024 (2) (7)
 
Senior Secured First Lien Debt
 
Media/Entertainment
 
3,115

 
54,171

 
24

 
(2,453
)
 
6

 
(8,053
)
 
43,695

NexSteppe, Inc. (2) (5) (7) (8)
 
Equity/Other
 
Chemicals
 
—

 
—

 
—

 
—

 
(737
)
 
737

 
—

NexSteppe, Inc. - 12.00%, 9/30/2020 (2) (5) (6) (7)
 
Senior Secured First Lien Debt
 
Chemicals
 
—

 
—

 
—

 
—

 
(1,750
)
 
1,750

 
—

NexSteppe, Inc. - 12.00%, 9/30/2020 (2) (5) (6) (7)
 
Senior Secured First Lien Debt
 
Chemicals
 
—

 
—

 
—

 
(377
)
 
(10,076
)
 
10,453

 
—

NMFC Senior Loan Program I, LLC (2)
 
Equity/Other
 
Diversified Investment Vehicles
 
4,000

 
47,310

 
—

 
—

 
—

 
(4,030
)
 
43,280

Park Ave RE Holdings, LLC - 13.00%, 12/31/2021 (2) (6) (7)
 
Subordinated Debt
 
Financials
 
3,685

 
37,237

 
1,237

 
—

 
—

 
—

 
38,474

Park Ave RE Holdings, LLC (2) (7) (8)
 
Equity/Other
 
Financials
 
—

 
11,133

 
—

 
(427
)
 
—

 
(8,894
)
 
1,812

Siena Capital Finance, LLC - 12.50%, 5/15/2024 (2) (7)
 
Subordinated Debt
 
Financials
 
2,412

 
22,500

 
3,000

 
—

 
—

 
—

 
25,500


67
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Portfolio Company (1)
 
Type of Asset
 
Industry
 
Amount of dividends and interest included in income
 
Beginning Fair Value at December 31, 2019
 
Gross additions*
 
Gross reductions**
 
Realized Gain/(Loss)
 
Change in Unrealized Gain (Loss) (4)
 
Fair Value at September 30, 2020
Siena Capital Finance, LLC (2) (7)
 
Equity/Other
 
Financials
 
$
3,774

 
$
36,915

 
$
11

 
$
—

 
$
—

 
$
(5,388
)
 
$
31,538

WPNT, LLC (2) (7) (8)
 
Equity/Other
 
Media/Entertainment
 
—

 
—

 
—

 
—

 
—

 
—

 
—

  Total Control Investments
 
 
 
 
 
$
25,363

 
$
406,517

 
$
11,700

 
$
(88,786
)
 
$
(13,061
)
 
$
(15,230
)
 
$
301,140

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Affiliate Investments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Answers Corp. (7) (8)
 
Equity/Other
 
Media/Entertainment
 
$
—

 
$
727

 
$
—

 
$
—

 
$
—

 
$
—

 
$
727

Capstone Nutrition Development, LLC (7) (8)
 
Equity/Other
 
Consumer
 
—

 
4,788

 
—

 
(320
)
 
—

 
651

 
5,119

Danish CRJ, Ltd. (7) (8)
 
Equity/Other
 
Transportation
 
—

 
—

 
—

 
—

 
—

 
—

 
—

First Eagle Greenway Fund II, LLC
 
Equity/Other
 
Diversified Investment Vehicles
 
(71
)
 
2,554

 
326

 
(45
)
 
—

 
(1,064
)
 
1,771

Foresight Energy Operating, LLC - L+8.00% (9.50%), 6/30/2027 (7)
 
Senior Secured First Lien Debt
 
Industrials
 
33

 
—

 
1,333

 
(4
)
 
—

 
19

 
1,348

Foresight Energy Operating, LLC - L+8.00% (9.50%), 6/30/2027 (5) (6) (7)
 
Senior Secured First Lien Debt
 
Industrials
 
4

 
—

 
977

 
(989
)
 
12

 
—

 
—

Foresight Energy Operating, LLC (7) (8)
 
Equity/Other
 
Industrials
 
—

 
—

 
2,087

 
—

 
—

 
29

 
2,116

Internap Corp. - L+10.00% (11.00%), 5/8/2023 (7)
 
Senior Secured First Lien Debt
 
Business Services
 
114

 
—

 
2,559

 
(724
)
 
46

 
114

 
1,995

Internap Corp. - L+6.50% (7.50%), 5/8/2025 (6) (7)
 
Senior Secured First Lien Debt
 
Business Services
 
178

 
—

 
5,873

 
—

 
—

 
(893
)
 
4,980

Internap Corp (7) (8)
 
Equity/Other
 
Business Services
 
—

 
—

 
543

 
—

 
—

 
1,068

 
1,611

Jakks Pacific, Inc. - 10.50%, 2/9/2023 (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
18

 
—

 
2,135

 
—

 
—

 
177

 
2,312

Jakks Pacific, Inc. (7) (8)
 
Equity/Other
 
Consumer
 
—

 
—

 
102

 
—

 
—

 
300

 
402

Jakks Pacific, Inc. (8)
 
Equity/Other
 
Consumer
 
—

 
—

 
41

 
—

 
—

 
(3
)
 
38

MidOcean Credit CLO 2013-2A INC - 0.00%, 1/29/2030 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
(22
)
 
11,835

 
—

 
(986
)
 
—

 
(6,811
)
 
4,038

Mood Media Corp. - L+9.25% (10.25%), 7/31/2025 (6) (7)
 
Senior Secured First Lien Debt
 
Media/Entertainment
 
78

 
—

 
9,242

 
(1,221
)
 
36

 
242

 
8,299

Mood Media Corp. - L+9.25% (10.25%), 7/31/2025 (6) (7)
 
Senior Secured First Lien Debt
 
Media/Entertainment
 
15

 
—

 
1,881

 
(273
)
 
9

 
72

 
1,689

Mood Media Corp. (7) (8)
 
Equity/Other
 
Media/Entertainment
 
—

 
—

 
2,713

 
—

 
—

 
1,670

 
4,383

NewStar Arlington Senior Loan Program, LLC 14-1A SUB - 0.00%, 4/25/2031 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
87

 
19,697

 
—

 
(232
)
 
—

 
(3,360
)
 
16,105

NewStar Arlington Senior Loan Program, LLC 14-1A FR - L+11.00% (11.24%), 4/25/2031 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
49

 
4,612

 
4

 
—

 
—

 
(1,120
)
 
3,496

Newstar Fairfield Fund CLO, Ltd. 2015-1RA F - L+7.50% (7.77%), 1/20/2027 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
97

 
9,209

 
40

 
—

 
—

 
(4,247
)
 
5,002

Newstar Fairfield Fund CLO, Ltd. 2015-1RA SUB - 0.00%, 1/20/2027 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
(318
)
 
6,607

 
—

 
(1,012
)
 
—

 
(5,595
)
 
—

PCX Aerostructures, LLC - 6.00%, 8/9/2021 (7)
 
Subordinated Debt
 
Industrials
 
361

 
5,908

 
119

 
(2
)
 
—

 
3,694

 
9,719

PCX Aerostructures, LLC (7) (8)
 
Equity/Other
 
Industrials
 
—

 
—

 
—

 
—

 
—

 
—

 
—


68
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Portfolio Company (1)
 
Type of Asset
 
Industry
 
Amount of dividends and interest included in income
 
Beginning Fair Value at December 31, 2019
 
Gross additions*
 
Gross reductions**
 
Realized Gain/(Loss)
 
Change in Unrealized Gain (Loss) (4)
 
Fair Value at September 30, 2020
PCX Aerostructures, LLC (7) (8)
 
Equity/Other
 
Industrials
 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
437

 
$
437

PCX Aerostructures, LLC (7) (8)
 
Equity/Other
 
Industrials
 
—

 
—

 
—

 
—

 
—

 
—

 
—

PennantPark Credit Opportunities Fund II, LP
 
Equity/Other
 
Diversified Investment Vehicles
 
490

 
8,707

 
—

 
—

 
—

 
376

 
9,083

Tap Rock Resources, LLC (7) (8)
 
Equity/Other
 
Energy
 
—

 
20,879

 
3,886

 
(11,417
)
 
186

 
1,226

 
14,760

Tax Defense Network, LLC - L+6.00% (10.00%), 9/30/2021 (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
—

 
1,262

 
—

 
—

 
—

 
(852
)
 
410

Tax Defense Network, LLC - L+6.00% (10.00%), 9/30/2021 (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
—

 
7,108

 
—

 
—

 
—

 
(4,799
)
 
2,309

Tax Defense Network, LLC - 10.00%, 9/30/2021 (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
—

 
2,357

 
629

 
—

 
—

 
244

 
3,230

Tax Defense Network, LLC (7) (8)
 
Equity/Other
 
Consumer
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Tax Defense Network, LLC (7) (8)
 
Equity/Other
 
Consumer
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Team Waste, LLC (7)
 
Equity/Other
 
Industrials
 
84

 
2,235

 
335

 
—

 
—

 
—

 
2,570

Tennenbaum Waterman Fund, LP
 
Equity/Other
 
Diversified Investment Vehicles
 
936

 
9,841

 
—

 
—

 
—

 
(520
)
 
9,321

TwentyEighty, Inc. (5) (7) (8)
 
Equity/Other
 
Business Services
 
—

 
—

 
—

 
(369
)
 
369

 
—

 
—

Vantage Mobility International, LLC - L+6.00% (7.00%), 6/30/2023 (5) (6) (7)
 
Senior Secured First Lien Debt
 
Transportation
 
—

 
—

 
196

 
(172
)
 
(24
)
 
—

 
—

Vantage Mobility International, LLC - L+6.00% (7.00%), 9/9/2021 (6) (7)
 
Senior Secured Second Lien Debt
 
Transportation
 
—

 
2,883

 
172

 
—

 
—

 
(881
)
 
2,174

Vantage Mobility International, LLC - L+7.75% (10.26%), 9/1/2021 (5) (7)
 
Subordinated Debt
 
Transportation
 
12

 
—

 
—

 
—

 
—

 
—

 
—

Vantage Mobility International, LLC (7) (8)
 
Equity/Other
 
Transportation
 
—

 
942

 
—

 
—

 
—

 
(942
)
 
—

Vantage Mobility International, LLC (7) (8)
 
Equity/Other
 
Transportation
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Vantage Mobility International, LLC (7) (8)
 
Equity/Other
 
Transportation
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Whitehorse, Ltd. 2014-1A SUB - 0.00%, 5/1/2026 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
—

 
286

 
—

 
—

 
—

 
(286
)
 
—

Whitehorse, Ltd. 2014-1A Side Letter - 0.00%, 5/1/2026 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
(2
)
 
35

 
—

 
—

 
—

 
(35
)
 
—

Whitehorse, Ltd. 2014-1A E - L+4.55% (4.80%), 5/1/2026 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
469

 
7,054

 
125

 
—

 
—

 
(3,311
)
 
3,868

Total Affiliate Investments
 
 
 
 
 
$
2,612

 
$
129,526

 
$
35,318

 
$
(17,766
)
 
$
634

 
$
(24,400
)
 
$
123,312

Total Control & Affiliate Investments
 
 
 
 
 
$
27,975

 
$
536,043

 
$
47,018

 
$
(106,552
)
 
$
(12,427
)
 
$
(39,630
)
 
$
424,452

______________________________________________________
*     Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest or dividends, the amortization of unearned income, the exchange of one or more existing securities for one or more new securities, and the movement of an existing portfolio company into this category from a different category.

69
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

**     Gross reductions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, the exchange of one or more existing securities for one or more new securities, and the movement of an existing portfolio company out of this category into a different category.
(1) 
The principal amount and ownership detail are shown in the consolidated schedules of investments.
(2) 
This investment was not deemed significant under Regulation S-X as of September 30, 2020.
(3) 
For the year ended December 31, 2019, the Company had determined that it must include audited financial statements of Kahala Ireland Opco Designated Activity Company because it was a controlled investment and was required to do so under SEC Rule 3-09. The audited financial statements were attached as Exhibit 99.1 in the Company's 2019 Form 10-K.
(4) 
Gross of net change in deferred taxes in the amount of $0.8 million.
(5) 
Investment no longer held as of September 30, 2020.
(6) 
Investment paid or has the option to pay all or a portion of interest and dividends via payment-in-kind.
(7) 
The fair value of investments with respect to securities for which market quotations are not readily available is determined in good faith by the Company's Board of Directors as required by the 1940 Act. Such investments are valued using significant unobservable inputs (See Note 3 to the consolidated financial statements).
(8) 
Investment is non-income producing at September 30, 2020.
Dividends and interest for the nine months ended September 30, 2020 attributable to Controlled and Affiliated investments no longer held as of September 30, 2020 were $16.1 thousand.
Realized loss for the nine months ended September 30, 2020 attributable to Controlled and Affiliated investments no longer held as of September 30, 2020 was $12.7 million.
Change in unrealized gain for the nine months ended September 30, 2020 attributable to Controlled and Affiliated investments no longer held as of September 30, 2020 was $12.9 million.
The following table presents the Schedule of Investments and Advances to Affiliates as of December 31, 2019:
Portfolio Company (1)
 
Type of Asset
 
Industry
 
Amount of dividends and interest included in income
 
Beginning Fair Value at December 31, 2018
 
Gross additions*
 
Gross reductions**
 
Realized Gain/(Loss)
 
Change in Unrealized Gain (Loss) (4)
 
Fair Value at December 31, 2019
Control Investments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
California Resources Development JV, LLC (2) (5) (7)
 
Equity/Other
 
Energy
 
$
887

 
$
28,973

 
$
—

 
$
(28,402
)
 
$
—

 
$
(571
)
 
$
—

Capstone Nutrition Common Stock (fka Integrity Nutraceuticals, Inc.) (2) (5) (7) (8)
 
Equity/Other
 
Consumer
 
—

 
—

 
—

 
(159
)
 
(1,471
)
 
1,630

 
—

Capstone Nutrition (fka Integrity Nutraceuticals, Inc.) - L+12.50% (15.08%), 9/25/2020 (2) (5) (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
—

 
3,219

 
1,804

 
(5,471
)
 
838

 
(390
)
 
—

Capstone Nutrition (fka Integrity Nutraceuticals, Inc.) - L+12.50% (15.08%), 9/19/2020 (2) (5) (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
(12
)
 
3,459

 
—

 
(1,612
)
 
(14,794
)
 
12,947

 
—

Capstone Nutrition (fka Integrity Nutraceuticals, Inc.) - L+12.50% (15.08%), 9/25/2020 (2) (5) (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
—

 
7,692

 
—

 
(3,282
)
 
(30,365
)
 
25,955

 
—

Capstone Nutrition Class B and C Common Stock (fka Integrity Nutraceuticals, Inc.) (2) (5) (7) (8)
 
Equity/Other
 
Consumer
 
—

 
—

 
—

 
—

 
—

 
—

 
—

CRD Holdings, LLC - 9.00% (2) (7)
 
Equity/Other
 
Energy
 
3,341

 
—

 
41,560

 
(13,494
)
 
—

 
877

 
28,943

CRS-SPV, Inc. (2) (7) (8)
 
Equity/Other
 
Industrials
 
26

 
2,221

 
—

 
—

 
—

 
—

 
2,221

CRS-SPV, Inc. - L+4.50% (6.30%), 3/8/2020 (2) (7)
 
Senior Secured First Lien Debt
 
Industrials
 
2

 
—

 
67

 
(5
)
 
—

 
—

 
62


70
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Portfolio Company (1)
 
Type of Asset
 
Industry
 
Amount of dividends and interest included in income
 
Beginning Fair Value at December 31, 2018
 
Gross additions*
 
Gross reductions**
 
Realized Gain/(Loss)
 
Change in Unrealized Gain (Loss) (4)
 
Fair Value at December 31, 2019
Kahala Ireland OpCo Designated Activity Company - L+8.00% (13.00%), 12/22/2028 (2) (3) (6) (7)
 
Senior Secured First Lien Debt
 
Transportation
 
$
11,695

 
$
111,549

 
$
38,000

 
$
(44,000
)
 
$
—

 
$
—

 
$
105,549

Kahala Ireland OpCo Designated Activity Company (2) (3) (7) (8)
 
Equity/Other
 
Transportation
 
—

 
20,329

 
—

 
—

 
—

 
36,897

 
57,226

Kahala Ireland OpCo Designated Activity Company (2) (3) (7) (8)
 
Equity/Other
 
Transportation
 
—

 
3,250

 
—

 
(36
)
 
—

 
36

 
3,250

Kahala US OpCo, LLC - 13.00% (2) (3) (7) (8)
 
Equity/Other
 
Transportation
 
—

 
—

 
—

 
—

 
—

 
—

 
—

MGTF Holdco, LLC (2) (7) (8)
 
Equity/Other
 
Media/Entertainment
 
—

 
—

 
—

 
—

 
—

 
—

 
—

MGTF Radio Company, LLC - L+6.00% (7.80%), 4/1/2024 (2) (7)
 
Senior Secured First Lien Debt
 
Media/Entertainment
 
3,754

 
—

 
62,291

 
(4,472
)
 
12

 
(3,660
)
 
54,171

MGTF Radio Company, LLC - P+3.50% (9.00%), 3/29/2020 (2) (5) (7)
 
Senior Secured First Lien Debt
 
Media/Entertainment
 
(9
)
 
—

 
37,577

 
(37,977
)
 
21

 
379

 
—

MGTF Radio Company, LLC - 16.00%, 3/30/2020 (2) (5) (7)
 
Subordinated Debt
 
Media/Entertainment
 
188

 
—

 
20,082

 
(24,309
)
 
—

 
4,227

 
—

NexSteppe, Inc. (2) (7) (8)
 
Equity/Other
 
Chemicals
 
—

 
—

 
—

 
—

 
—

 
—

 
—

NexSteppe, Inc. - 12.00% 3/31/2020 (2) (6) (7)
 
Senior Secured First Lien Debt
 
Chemicals
 
—

 
—

 
—

 
—

 
—

 
—

 
—

NexSteppe, Inc. - 12.00% 3/31/2020 (2) (6) (7)
 
Senior Secured First Lien Debt
 
Chemicals
 
—

 
—

 
—

 
—

 
—

 
—

 
—

NMFC Senior Loan Program I, LLC (2)
 
Equity/Other
 
Diversified Investment Vehicles
 
5,864

 
50,573

 
—

 
—

 
—

 
(3,263
)
 
47,310

Park Ave RE Holdings, LLC - 13.00% 12/31/2021 (2) (6) (7)
 
Subordinated Debt
 
Financials
 
4,858

 
37,192

 
1,750

 
(1,705
)
 
—

 
—

 
37,237

Park Ave RE Holdings, LLC (2) (7) (8)
 
Equity/Other
 
Financials
 
—

 
15,578

 
2,500

 
(4,246
)
 
4,486

 
(7,185
)
 
11,133

Park Ave RE Holdings, LLC (2) (5) (7) (8)
 
Equity/Other
 
Financials
 
—

 
23,645

 
—

 
(23,645
)
 
—

 
—

 
—

Siena Capital Finance, LLC - 12.50% 8/16/2021 (2) (7)
 
Subordinated Debt
 
Financials
 
2,346

 
—

 
22,492

 
—

 
—

 
8

 
22,500

Siena Capital Finance, LLC (2) (7)
 
Equity/Other
 
Financials
 
4,732

 
—

 
36,631

 
—

 
(94
)
 
378

 
36,915

WPNT, LLC (2) (7) (8)
 
Equity/Other
 
Media/Entertainment
 
—

 
—

 
—

 
—

 
—

 
—

 
—

  Total Control Investments
 
 
 
 
 
$
37,672

 
$
307,680

 
$
264,754

 
$
(192,815
)
 
$
(41,367
)
 
$
68,265

 
$
406,517

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Affiliate Investments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Answers Corp. (7)
 
Equity/Other
 
Media/Entertainment
 
$
818

 
$
1,909

 
$
—

 
$
—

 
$
—

 
$
(1,182
)
 
$
727

B&M CLO, Ltd. 2014-1A SUB - 0.00%, 4/16/2026 (5) (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
46

 
6,029

 
—

 
(5,839
)
 
(4,685
)
 
4,495

 
—

Capstone Nutrition Development, LLC (7) (8)
 
Equity/Other
 
Consumer
 
—

 
—

 
4,788

 
—

 
—

 
—

 
4,788

CVP Cascade CLO, Ltd. 2013-CLO1 SUB - 0.00%, 1/16/2026 (5) (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
221

 
1,166

 
—

 
(539
)
 
(435
)
 
(192
)
 
—

CVP Cascade CLO, Ltd. 2013-CLO1 Side Letter - 0.00%, 1/16/2026 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
12

 
68

 
—

 
(405
)
 
—

 
337

 
—

CVP Cascade CLO, Ltd. 2014-2A Side Letter - 0.00%, 7/18/2026 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
43

 
274

 
—

 
(550
)
 
—

 
276

 
—

Danish CRJ, Ltd. (7) (8)
 
Equity/Other
 
Transportation
 
—

 
—

 
—

 
—

 
—

 
—

 
—


71
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Portfolio Company (1)
 
Type of Asset
 
Industry
 
Amount of dividends and interest included in income
 
Beginning Fair Value at December 31, 2018
 
Gross additions*
 
Gross reductions**
 
Realized Gain/(Loss)
 
Change in Unrealized Gain (Loss) (4)
 
Fair Value at December 31, 2019
Figueroa CLO, Ltd. 2014-1A FR - L+10.00% (12.30%), 1/15/2027 (5) (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
$
857

 
$
7,508

 
$
—

 
$
(5,730
)
 
$
(2,270
)
 
$
492

 
$
—

Figueroa CLO, Ltd. 2014-1A SUB - 0.00%, 1/15/2027 (5) (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
324

 
7,468

 
—

 
(6,289
)
 
(5,280
)
 
4,101

 
—

Figueroa CLO, Ltd. 2014-1A Side Letter - 0.00%, 1/15/2027 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
37

 
483

 
—

 
(550
)
 
—

 
67

 
—

Frank Entertainment Group, LLC - 6.00% 12/31/2019 (5) (7)
 
Senior Secured First Lien Debt
 
Media/Entertainment
 
—

 
1,441

 
—

 
(347
)
 
(1,489
)
 
395

 
—

Frank Entertainment Group, LLC - L+9.00% (11.03%), 12/31/2019 (5) (6) (7)
 
Senior Secured First Lien Debt
 
Media/Entertainment
 
—

 
—

 
867

 
—

 
(867
)
 
—

 
—

Frank Entertainment Group, LLC - 12.00% 12/31/2019 (5) (6) (7)
 
Senior Secured Second Lien Debt
 
Media/Entertainment
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Frank Entertainment Group, LLC (5) (7) (8)
 
Equity/Other
 
Media/Entertainment
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Frank Entertainment Group, LLC (5) (7) (8)
 
Equity/Other
 
Media/Entertainment
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Frank Entertainment Group, LLC (5) (7) (8)
 
Equity/Other
 
Media/Entertainment
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Frontstreet Facility Solutions, Inc. - 13.00%, 3/1/2021 (5) (7)
 
Subordinated Debt
 
Telcom
 
26

 
189

 
—

 
(123
)
 
(104
)
 
38

 
—

Frontstreet Facility Solutions, Inc. (5) (7) (8)
 
Equity/Other
 
Telcom
 
—

 
—

 
—

 
(128
)
 
128

 
—

 
—

MidOcean Credit CLO 2013-2A INC - 0.76%, 1/29/2025 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
432

 
16,534

 
—

 
(3,630
)
 
—

 
(1,069
)
 
11,835

MidOcean Credit CLO III, LLC - 13.99%, 7/21/2026 (5) (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
431

 
14,651

 
—

 
(17,458
)
 
544

 
2,263

 
—

MidOcean Credit CLO 2015-4A INC - 0.00%, 4/15/2027 (5) (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
—

 
8,595

 
—

 
(6,795
)
 
(5,310
)
 
3,510

 
—

NewStar Arlington Senior Loan Program, LLC 14-1A SUB - 16.56%, 7/25/2025 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
3,546

 
24,788

 
—

 
(447
)
 
—

 
(4,644
)
 
19,697

NewStar Arlington Senior Loan Program, LLC 14-1A FR - L+11.00% (12.94%), 4/25/2031 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
664

 
4,425

 
18

 
—

 
—

 
169

 
4,612

Newstar Fairfield Fund CLO, Ltd. 2015-1RA F - L+7.50% (9.47%), 1/20/2027 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
1,244

 
8,580

 
162

 
—

 
—

 
467

 
9,209

Newstar Fairfield Fund CLO, Ltd. 2015-1RA SUB - 21.81%, 1/20/2027 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
1,639

 
11,895

 
—

 
(3,032
)
 
—

 
(2,256
)
 
6,607

OFSI Fund, Ltd. 2014-6A SUB - 0.00%, 3/20/2025 (5) (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
—

 
3,008

 
—

 
(1,535
)
 
(8,468
)
 
6,995

 
—

OFSI Fund, Ltd. 2014-6A Side Letter - 0.00%, 3/20/2025 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
—

 
199

 
—

 
(238
)
 
—

 
39

 
—

PCX Aerostructures, LLC - 6.00%, 8/9/2021 (6) (7)
 
Subordinated Debt
 
Industrials
 
464

 
—

 
6,023

 
—

 
—

 
(115
)
 
5,908

PCX Aerostructures, LLC (7) (8)
 
Equity/Other
 
Industrials
 
—

 
—

 
—

 
—

 
—

 
—

 
—

PCX Aerostructures, LLC (7) (8)
 
Equity/Other
 
Industrials
 
—

 
—

 
—

 
—

 
—

 
—

 
—


72
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Portfolio Company (1)
 
Type of Asset
 
Industry
 
Amount of dividends and interest included in income
 
Beginning Fair Value at December 31, 2018
 
Gross additions*
 
Gross reductions**
 
Realized Gain/(Loss)
 
Change in Unrealized Gain (Loss) (4)
 
Fair Value at December 31, 2019
PCX Aerostructures, LLC (7) (8)
 
Equity/Other
 
Industrials
 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

PennantPark Credit Opportunities Fund II, LP
 
Equity/Other
 
Diversified Investment Vehicles
 
647

 
8,705

 
304

 
—

 
—

 
(302
)
 
8,707

Tap Rock Resources, LLC (7) (8)
 
Equity/Other
 
Energy
 
—

 
—

 
20,672

 
—

 
—

 
207

 
20,879

Tax Defense Network, LLC - L+6.00% (10.00%), 4/30/2020 (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
(4
)
 
1,195

 
—

 
(111
)
 
—

 
178

 
1,262

Tax Defense Network, LLC - L+6.00% (10.00%), 4/30/2020 (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
(30
)
 
6,732

 
—

 
(631
)
 
3

 
1,004

 
7,108

Tax Defense Network, LLC - L+10.00% (10.00%), 4/30/2020 (6) (7)
 
Senior Secured First Lien Debt
 
Consumer
 
—

 
—

 
2,357

 
—

 
—

 
—

 
2,357

Tax Defense Network, LLC (7) (8)
 
Equity/Other
 
Consumer
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Tax Defense Network, LLC (7) (8)
 
Equity/Other
 
Consumer
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Team Waste, LLC (7) (8)
 
Equity/Other
 
Industrials
 
—

 
2,235

 
—

 
—

 
—

 
—

 
2,235

Tennenbaum Waterman Fund, LP
 
Equity/Other
 
Diversified Investment Vehicles
 
1,381

 
10,137

 
—

 
—

 
—

 
(296
)
 
9,841

THL Credit Greenway Fund II, LLC
 
Equity/Other
 
Diversified Investment Vehicles
 
1,636

 
7,435

 
—

 
(3,290
)
 
—

 
(1,591
)
 
2,554

TwentyEighty, Inc. (5) (7) (8)
 
Equity/Other
 
Business Services
 
—

 
—

 
—

 
(6,465
)
 
6,465

 
—

 
—

TwentyEighty, Inc. - L+8.00% (10.33%), 3/31/2020 (5) (6) (7)
 
Senior Secured First Lien Debt
 
Business Services
 
40

 
300

 
13

 
(304
)
 
17

 
(26
)
 
—

TwentyEighty, Inc. - 8.00%, 3/31/2020 (5) (6) (7)
 
Senior Secured First Lien Debt
 
Business Services
 
1,013

 
6,422

 
813

 
(6,754
)
 
481

 
(962
)
 
—

TwentyEighty, Inc. - 9.00%, 3/31/2020 (5) (6) (7)
 
Senior Secured First Lien Debt
 
Business Services
 
992

 
6,158

 
981

 
(6,709
)
 
438

 
(868
)
 
—

Vantage Mobility International, LLC - L+6.00% (7.80%), 6/30/2023 (6) (7)
 
Senior Secured Second Lien Debt
 
Transportation
 
—

 
—

 
2,742

 
—

 
—

 
141

 
2,883

Vantage Mobility International, LLC - L+6.00% (8.44%), 6/30/2023 (5)
 
Senior Secured First Lien Debt
 
Transportation
 
—

 
—

 
2,351

 
(2,351
)
 
—

 
—

 
—

Vantage Mobility International, LLC - L+7.75% (10.26%), 9/1/2021 (5) (7)
 
Subordinated Debt
 
Transportation
 
480

 
—

 
5,842

 
(5,490
)
 
(509
)
 
157

 
—

Vantage Mobility International, LLC (7) (8)
 
Equity/Other
 
Transportation
 
—

 
—

 
3,140

 
—

 
—

 
(2,198
)
 
942

Vantage Mobility International, LLC (7) (8)
 
Equity/Other
 
Transportation
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Vantage Mobility International, LLC (7) (8)
 
Equity/Other
 
Transportation
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Whitehorse, Ltd. 2014-1A SUB - 0.00%, 5/1/2026 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
18

 
3,975

 
—

 
(1,895
)
 
—

 
(1,794
)
 
286

Whitehorse, Ltd. 2014-1A Side Letter - 10.44%, 5/1/2026 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
8

 
297

 
—

 
(342
)
 
—

 
80

 
35

Whitehorse, Ltd. 2014-1A E - L+4.55% (6.46%), 5/1/2026 (7)
 
Collateralized Securities
 
Diversified Investment Vehicles
 
297

 
—

 
7,314

 
—

 
—

 
(260
)
 
7,054


73
BUSINESS DEVELOPMENT CORPORATION OF AMERICA

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts, percentages and as otherwise indicated)
For the period ended September 30, 2020
(Unaudited)

Portfolio Company (1)
 
Type of Asset
 
Industry
 
Amount of dividends and interest included in income
 
Beginning Fair Value at December 31, 2018
 
Gross additions*
 
Gross reductions**
 
Realized Gain/(Loss)
 
Change in Unrealized Gain (Loss) (4)
 
Fair Value at December 31, 2019
World Business Lenders, LLC (7) (8)
 
Equity/Other
 
Financials
 
$
—

 
$
3,759

 
$
—

 
$
(3,755
)
 
$
—

 
$
(4
)
 
$
—

Total Affiliate Investments
 
 
 
 
 
$
17,282

 
$
176,560

 
$
58,387

 
$
(91,732
)
 
$
(21,341
)
 
$
7,652

 
$
129,526

Total Control & Affiliate Investments
 
 
 
 
 
$
54,954

 
$
484,240

 
$
323,141

 
$
(284,547
)
 
$
(62,708
)
 
$
75,917

 
$
536,043


_____________________________________________________
*     Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest or dividends, the amortization of unearned income, the exchange of one or more existing securities for one or more new securities, and the movement of an existing portfolio company into this category from a different category.
**     Gross reductions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, the exchange of one or more existing securities for one or more new securities, and the movement of an existing portfolio company out of this category into a different category.
(1) 
The principal amount and ownership detail are shown in the consolidated schedules of investments.
(2) 
This investment was not deemed significant under Regulation S-X as of December 31, 2019.
(3) 
For the year ended December 31, 2019, the Company had determined that it must include audited financial statements of Kahala Ireland Opco Designated Activity Company because it was a controlled investment and was required to do so under SEC Rule 3-09. The audited financial statements were attached as Exhibit 99.1 in the Company's 2019 Form 10-K.
(4) 
Gross of net change in deferred taxes in the amount of $1.0 million.
(5) 
Investment no longer held as of December 31, 2019.
(6) 
Investment paid or has the option to pay all or a portion of interest and dividends via payment-in-kind.
(7) 
The fair value of investments with respect to securities for which market quotations are not readily available is determined in good faith by the Company's Board of Directors as required by the 1940 Act. Such investments are valued using significant unobservable inputs (See Note 3 to the consolidated financial statements).
(8) 
Investment is non-income producing at December 31, 2019.
Dividends and interest for the year ended December 31, 2019 attributable to Controlled and Affiliated investments no longer held as of December 31, 2019 were $5.5 million.
Realized loss for the year ended December 31, 2019 attributable to Controlled and Affiliated investments no longer held as of December 31, 2019 was $67.1 million.
Change in unrealized gain for the year ended December 31, 2019 attributable to Controlled and Affiliated investments no longer held as of December 31, 2019 was $64.6 million.
Note 16 – Subsequent Events
The Company has evaluated subsequent events through the filing of this Form 10-Q and has determined that there have been no events that have occurred that would require adjustments to the Company’s disclosures in the consolidated financial statements.


74

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with the accompanying consolidated financial statements of Business Development Corporation of America (the "Company," "BDCA," "we," or "our") and the notes thereto and other financial information included elsewhere in this Quarterly Report on Form 10-Q. We are externally managed by our adviser, BDCA Adviser, LLC (the “Adviser”).
Forward Looking Statements
The forward-looking statements contained in this Quarterly Report on Form 10-Q may include statements as to:
•
our future operating results;
•
the impact of the COVID-19 pandemic on our business and our portfolio companies, including our and their ability to access capital and liquidity;
•
changes in political, economic or industry conditions, the interest rate environment or conditions affecting the financial and capital markets, including the effect of the current COVID-19 pandemic;
•
the impact that the discontinuation of LIBOR and the transition to new reference rates could have on the value of our LIBOR-indexed portfolio investments and the cost of borrowing under our credit facilities;
•
the impact of the investments that we expect to make;
•
the ability of our portfolio companies to achieve their objectives;
•
our contractual arrangements and relationships with third parties;
•
our expected financings and investments;
•
the adequacy of our cash resources and working capital;
•
the timing of cash flows, if any, from the operations of our portfolio companies;
•
our repurchase of shares;
•
actual and potential conflicts of interest with our Adviser and its affiliates;
•
the dependence of our future success on the general economy and its effect on the industries in which we invest;
•
the ability to qualify and maintain our qualifications as a regulated investment company (“RIC”) and a business development company (“BDC”);
•
the timing, form, and amount of any distributions;
•
the impact of fluctuations in interest rates on our business;
•
the valuation of any investments in portfolio companies, particularly those having no liquid trading market;
•
the impact of changes to generally accepted accounting principles, and the impact to BDCA; and
•
the impact of changes to tax legislation and, generally, our tax position.
In addition, words such as "anticipate," "believe," "expect," and "intend" indicate a forward-looking statement, although not all forward-looking statements include these words. The forward-looking statements contained in this Quarterly Report on Form 10-Q involve risks and uncertainties. Our actual results could differ materially from those implied or expressed in the forward-looking statements for any reason, including the factors discussed in Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K. Other factors that could cause actual results to differ materially include:
•
changes in the economy;
•
risks associated with possible disruption in our operations or the economy generally due to terrorism or natural disasters; and
•
future changes in laws or regulations and conditions in our operating areas.
You should not place undue reliance on these forward-looking statements. The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligations to update any forward-looking statement to reflect events or circumstances occurring after the date of this Quarterly Report on Form 10-Q.

75


Overview
We are an externally managed, non-diversified closed-end management investment company incorporated in Maryland in May 2010 that has elected to be regulated as a BDC under the Investment Company Act of 1940, as amended (“the 1940 Act”). In addition, we have elected to be treated for tax purposes as a RIC under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). Our investment activities are managed by the Adviser, a subsidiary of Benefit Street Partners L.L.C. (“BSP”) and supervised by our Board of Directors, a majority of whom are independent of the Adviser and its affiliates. As a BDC, we are required to comply with certain regulatory requirements.
Our investment objective is to generate both current income and to a lesser extent long-term capital appreciation through debt and equity investments. We invest primarily in senior secured loans, and to a lesser extent, mezzanine loans, unsecured loans, and equity of predominantly private U.S. middle-market companies. We define middle market companies as those with annual revenues of less than $1 billion, although we may invest in larger or smaller companies. We may also purchase interests in loans or corporate bonds through secondary market transactions. We expect that each investment generally will range between approximately 0.5% and 3.0% of our total assets. As of September 30, 2020, 80.1% of our portfolio was invested in senior secured loans.
Senior secured loans generally are senior debt instruments that rank ahead of subordinated debt and equity in priority of payments and are generally secured by liens on the operating assets of a borrower which may include inventory, receivables, plant, property, and equipment. Mezzanine debt is subordinated to senior loans and is generally unsecured. We may also invest in the equity and junior debt tranches of collateralized loan obligation investment vehicles (“Collateralized Securities” or “CLO's”).
Financial and Operating Highlights
(Dollars in millions, except per share amounts)
 
At September 30, 2020:
 
 
Investment Portfolio
$
2,210.8

 
Net assets
1,346.5

 
Debt (net of deferred financing costs)
879.0

 
Net asset value per share
6.71

 
 
 
Portfolio Activity for the Nine Months Ended September 30, 2020:
 
 
Cost of investments purchased during period, including PIK
501.6

 
Sales, repayments, and other exits during the period
669.9

 
Number of portfolio companies at end of period
226

 
 
 
Operating results for the Nine Months Ended September 30, 2020:
 
 
Net investment income per share
0.34

 
Distributions declared per share
0.36

 
Net decrease in net assets resulting from operations per share
(0.53
)
 
Net investment income
66.3

 
Net realized and unrealized loss, net of change in deferred taxes
(171.2
)
 
Net decrease in net assets resulting from operations
(104.9
)
Portfolio and Investment Activity
During the nine months ended September 30, 2020, we made $495.5 million of investments in new and existing portfolio companies and had $669.9 million in aggregate amount of sales and repayments, resulting in net sales and repayments of $174.4 million for the period. The total portfolio of debt investments at fair value consisted of 91.3% bearing variable interest rates and 8.7% bearing fixed interest rates.

76


Our portfolio composition, based on fair value at September 30, 2020 was as follows:
 
September 30, 2020
 
Percentage of
Total Portfolio
 
Weighted Average Current Yield for Total Portfolio (1)
Senior Secured First Lien Debt
70.6
%
 
7.1
%
Senior Secured Second Lien Debt
9.5

 
10.4

Subordinated Debt
5.3

 
10.7

Collateralized Securities (2)
4.3

 
5.9

Equity/Other (3)
10.3

 
6.9

Total
100.0
%
 
7.5
%
______________
(1) Includes the effect of the amortization or accretion of loan premiums or discounts.
(2) Weighted average current yield for Collateralized Securities is based on the estimation of effective yield to expected maturity for each security as calculated in accordance with Accounting Standards Codification ("ASC") Topic 325-40-35, Beneficial Interests in Securitized Financial Assets (see Note 2 - Summary of Significant Accounting Policies).
(3) Weighted average current yield for Equity/Other may be based on actual or annualized income, where applicable.
During the year ended December 31, 2019, we made $997.0 million of investments in new and existing portfolio companies and had $786.8 million in aggregate amount of sales and repayments, resulting in net investments of $210.2 million for the period. The total portfolio of debt investments at fair value consisted of 90.5% bearing variable interest rates and 9.5% bearing fixed interest rates.
Our portfolio composition, based on fair value at December 31, 2019 was as follows:
 
December 31, 2019
 
Percentage of
Total Portfolio
 
Weighted Average Current Yield for Total Portfolio (1)
Senior Secured First Lien Debt
69.3
%
 
8.5
%
Senior Secured Second Lien Debt
12.0

 
12.3

Subordinated Debt
4.2

 
11.3

Collateralized Securities (2)
4.3

 
10.1

Equity/Other (3)
10.2

 
6.3

Total
100.0
%
 
8.9
%
______________
(1) Includes the effect of the amortization or accretion of loan premiums or discounts.
(2) Weighted average current yield for Collateralized Securities is based on the estimation of effective yield to expected maturity for each security as calculated in accordance with ASC Topic 325-40-35, Beneficial Interests in Securitized Financial Assets (see Note 2 - Summary of Significant Accounting Policies).
(3) Weighted average current yield for Equity/Other may be based on actual or annualized income, where applicable.
Portfolio Asset Quality
Our Adviser employs an investment rating system to categorize our investments. In addition to various risk management and monitoring tools, our Adviser grades the credit risk of all debt investments on a scale of 1 to 5 no less frequently than quarterly. This system is intended primarily to reflect the underlying risk of a portfolio debt investment relative to the inherent risk at the time the original debt investment was made (i.e., at the time of acquisition), although it may also take into account under certain circumstances the performance of the portfolio company's business, the collateral coverage of the investment and other relevant factors.

77


 Loan Rating
 
Summary Description
1
  
Debt investment exceeding fundamental performance expectations and/or capital gain expected. Trends and risk factors since the time of investment are favorable.
 
 
2
  
Performing consistent with expectations and a full return of principal and interest expected. Trends and risk factors are neutral to favorable. All investments are initially rated a “2”.
 
 
3
  
Performing debt investment requiring closer monitoring. Trends and risk factors show some deterioration.
 
 
4
  
Underperforming debt investment. Some loss of interest or dividend expected, but still expecting a positive return on investment. Trends and risk factors are negative.
 
 
5
  
Underperforming debt investment with expected loss of interest and some principal.
The weighted average risk rating of our investments based on fair value was 2.49 and 2.37 as of September 30, 2020 and December 31, 2019, respectively. As of September 30, 2020, we had fifteen portfolio companies, which represented twenty investments, on non-accrual status with a total amortized cost of $142.9 million and fair value of $83.0 million which represented 6.0% and 3.8% of the investment portfolio's total amortized cost and fair value, respectively. As of December 31, 2019, we had eight portfolio companies, which represented twelve portfolio investments, on non-accrual status with a total amortized cost of $62.8 million and fair value of $22.5 million, which represented 2.4%, and 0.9% of the investment portfolio's total amortized cost and fair value, respectively. Refer to Note 2 - Summary of Significant Accounting Policies - in our consolidated financial statements included in this report for additional details regarding our non-accrual policy.
RESULTS OF OPERATIONS
Operating results for the three and nine months ended September 30, 2020 and 2019 were as follows (dollars in thousands):
 
For the three months ended September 30,
 
For the nine months ended September 30,
 
2020
 
2019
 
2020
 
2019
Total investment income
$
44,166

 
$
63,192

 
$
142,528

 
$
186,345

Total expenses
22,609

 
34,914

 
74,286

 
102,839

Income tax expense, including excise tax
1,237

 
338

 
1,931

 
1,301

Net investment gain attributable to non-controlling interests
—

 
—

 
—

 
9

Net investment income
$
20,320

 
$
27,940

 
$
66,311

 
$
82,196

Investment Income
For the three and nine months ended September 30, 2020, total investment income was $44.2 million and $142.5 million, respectively, and was primarily attributable to interest income from investments in portfolio companies with an average portfolio fair value of $2.4 billion and a weighted average current yield of 7.5%. Included within total investment income was $2.2 million and $4.4 million, respectively, of fee income for the three and nine months ended September 30, 2020. Fee income consists primarily of prepayment and amendment fees. For the three and nine months ended September 30, 2019, total investment income was $63.2 million and $186.3 million, respectively and was primarily attributable to interest income from investments in portfolio companies with an average portfolio fair value of $2.5 billion and a weighted average current yield of 9.2%. Included within total investment income was $1.1 million and $2.6 million, respectively, of fee income for the three and nine months ended September 30, 2019. Fee income consists primarily of prepayment and amendment fees.

78


Operating Expenses
The composition of our operating expenses for the three and nine months ended September 30, 2020 and 2019 was as follows (dollars in thousands):
 
For the three months ended September 30,
 
For the nine months ended September 30,
 
2020
 
2019
 
2020
 
2019
Management fees
$
8,933

 
$
10,269

 
$
28,255

 
$
29,739

Incentive fee on income
—

 
6,985

 
—

 
20,549

Interest and debt fees
10,909

 
14,131

 
36,986

 
41,505

Professional fees
1,365

 
1,207

 
3,966

 
4,342

Other general and administrative
785

 
1,897

 
3,391

 
5,424

Administrative services
395

 
199

 
955

 
592

Directors' fees
222

 
226

 
733

 
688

Total operating expenses
$
22,609

 
$
34,914

 
$
74,286

 
$
102,839

For the three and nine months ended September 30, 2020, we incurred management fees of $8.9 million and $28.3 million, respectively. For both the three and nine months ended September 30, 2020, we did not incur incentive fees on income. For the three and nine months ended September 30, 2019, we incurred management fees of $10.3 million and $29.7 million, respectively. For the three and nine months ended September 30, 2019, we incurred incentive fees on income of $7.0 million and $20.5 million, respectively.
For the three and nine months ended September 30, 2020, we incurred interest and debt fees of $10.9 million and $37.0 million, respectively. For the three and nine months ended September 30, 2019, we incurred interest and debt fees of $14.1 million and $41.5 million, respectively. Interest and debt fees are comprised of interest expense, non-usage fees, trustee fees, amortization of deferred financing costs, and amortization of discount if applicable related to our revolving credit facilities and unsecured notes, each as defined herein in the section entitled "Borrowings". The decrease in interest and debt fees for the three and nine months ended September 30, 2020 as compared to the same periods in 2019 is primarily the result of a decrease in average interest costs coupled with a decrease in principal outstanding.

79


Net Realized Gain (Loss) and Net Change in Unrealized Appreciation (Depreciation) on Investments, Foreign Currency Transactions, and Forward Currency Exchange Contracts
Net realized gain (loss) and net change in unrealized appreciation (depreciation) on investments and foreign currency transactions, net of change in deferred taxes for the three and nine months ended September 30, 2020 and 2019 were as follows (dollars in thousands):
 
For the three months ended September 30,
 
For the nine months ended September 30,
 
2020
 
2019
 
2020
 
2019
Net realized gain (loss)
 
 
 
 
 
 
 
   Control investments
$
(12,689
)
 
$
(41,306
)
 
$
(13,061
)
 
$
(41,400
)
   Affiliate investments
32

 
928

 
634

 
1,483

   Non-affiliate investments
(23,254
)
 
2,183

 
(93,560
)
 
1,660

   Net realized gain (loss) on foreign currency transactions
(845
)
 
(242
)
 
(72
)
 
432

Total net realized loss
(36,756
)
 
(38,437
)
 
(106,059
)
 
(37,825
)
Net change in unrealized appreciation (depreciation) on investments
 
 
 
 
 
 
 
   Control investments
21,652

 
33,530

 
(15,230
)
 
62,279

   Affiliate investments
1,278

 
(13,964
)
 
(24,400
)
 
(5,197
)
   Non-affiliate investments
51,891

 
(23,788
)
 
(26,735
)
 
(22,403
)
Net change in deferred taxes
(930
)
 
2,225

 
818

 
1,739

Total net change in unrealized appreciation (depreciation) on investments, net of change in deferred taxes
73,891

 
(1,997
)
 
(65,547
)
 
36,418

Net change in unrealized depreciation attributable to non-controlling interests
—

 
—

 
—

 
(3,017
)
Net change in unrealized appreciation (depreciation) from forward currency exchange contracts
519

 
444

 
442

 
(826
)
Net realized and unrealized gain (loss)
$
37,654

 
$
(39,990
)
 
$
(171,164
)
 
$
(5,250
)
Net realized and unrealized gain (loss) on investments and foreign currency transactions, net of change in deferred taxes, resulted in a net gain (loss) of $37.7 million and $(171.2) million, respectively, for the three and nine months ended September 30, 2020 compared to a net loss of $(40.0) million and $(5.3) million for the same periods in 2019. We look at net realized gain (loss) and change in unrealized appreciation (depreciation) together, as movement in unrealized appreciation or depreciation can be the result of realizations.
The net realized and unrealized gain for the three months ended September 30, 2020 was primarily driven by unrealized gains on Senior Secured Investments, partially offset by realized losses on Senior Secured Investments. The net realized and unrealized loss for the nine months ended September 30, 2020 was primarily driven by realized losses on Senior Secured Investments as well as unrealized losses on Senior Secured Investments, Collateralized Securities, and Equity investments.
Changes in Net Assets from Operations
During the nine months ended September 30, 2020, our operating results were impacted by the uncertainty surrounding the COVID-19 pandemic, which had a negative impact on the global economy and impacted the fair value and performance of our investment portfolio. For the three and nine months ended September 30, 2020, we recorded a net increase (decrease) in net assets resulting from operations of $58.0 million and $(104.9) million, respectively, versus a net increase (decrease) in net assets resulting from operations of $(12.1) million and $76.9 million, respectively, for the three and nine months ended September 30, 2019. The increase in net assets resulting from operations for the three months ended September 30, 2020, as compared to the prior period, is driven by an increase in unrealized appreciation on our investments. The decrease for the nine months ended September 30, 2020, as compared to the prior period, is primarily driven by an increase in realized and unrealized loss on our investments. Based on the weighted average shares of common stock outstanding for the periods ended September 30, 2020 and 2019, our per share net increase (decrease) in net assets resulting from operations was $0.29 and $(0.53), respectively, for the three and nine months ended September 30, 2020, versus a net increase (decrease) in net assets resulting from operations of $(0.06) and $0.41, respectively, for the three and nine months ended September 30, 2019.

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Cash Flows
For the nine months ended September 30, 2020, net cash provided by operating activities was $239.3 million. The level of cash flows used in or provided by operating activities is affected by the timing of purchases, redemptions, and sales of portfolio investments. The increase in cash flows provided by operating activities for the nine months ended September 30, 2020 was primarily a result of sales and repayments of investments of $669.9 million and net change in unrealized depreciation on investments of $66.4 million, offset by purchases of investments of $495.5 million.
Net cash used in financing activities of $214.7 million during the nine months ended September 30, 2020 primarily related to payments on debt of $976.7 million, which was partially offset by proceeds from debt of $774.0 million.
For the nine months ended September 30, 2019, net cash used in operating activities was $128.4 million. The level of cash flows used in or provided by operating activities is affected by the timing of purchases, redemptions, and sales of portfolio investments. The decrease in cash flows used in operating activities for the nine months ended September 30, 2019 was primarily a result of purchases of investments of $795.5 million, offset by sales and repayments of investments of $560.6 million.
Net cash provided by financing activities of $129.8 million during the nine months ended September 30, 2019 primarily related to proceeds from debt of $282.0 million, which was partially offset by net repurchases of common stock of $36.1 million, payments of stockholder distributions of $66.2 million, and payments on debt of $45.0.
Impact of COVID-19 Pandemic
The COVID-19 pandemic has resulted in governments around the world implementing a broad suite of measures to help control the spread of the virus, including quarantines, travel restrictions and business curtailments and others. The emergence of COVID-19 has created economic and financial disruptions that during the quarter adversely affected, and may continue to affect, our business, financial condition, liquidity and certain of our portfolio companies’ results of operations and liquidity. The extent to which the COVID-19 pandemic will continue to affect our business, financial condition, liquidity and certain of our portfolio companies’ results of operations and liquidity will depend on future developments, which are highly uncertain and cannot be predicted.
Given the unprecedented nature of the COVID-19 exigency and the fiscal and monetary response designed to mitigate strain to businesses and the economy, the operating environment of certain of our portfolio companies is evolving rapidly. We have been in frequent communication with management, as well as the private equity sponsors, of our portfolio companies in order to understand the impact of the COVID-19 pandemic on their particular businesses and assess their ability to meet their obligations. As a result of the business disruptions affecting certain of our portfolio companies, we may be required to reduce the future amount of distributions to our stockholders. We continue to closely monitor our investment portfolio in order to be positioned to respond appropriately.
Recent Developments
We have evaluated subsequent events through the filing of this Form 10-Q and have determined that there have been no events that have occurred that would require adjustments to our disclosures in the consolidated financial statements.
Liquidity and Capital Resources
We generate cash flows from fees, interest, and dividends earned from our investments, as well as proceeds from sales of our investments and, previously, from the net proceeds of our Offering. As of September 30, 2020, we had issued 228.6 million shares of our common stock for gross proceeds of $2.3 billion, including the shares purchased by affiliates and shares issued pursuant to the DRIP. As of September 30, 2020, we had $310.0 million of senior unsecured notes outstanding. We suspended the DRIP from March 29, 2020 through June 26, 2020. While the DRIP was suspended, participants and all other holders of our common stock received distributions paid in cash. On March 31, 2020, we issued in a private placement an aggregate amount of 9,532,062 newly issued shares of our common stock at a price of $5.77 per share for aggregate cash proceeds of $55.0 million and on April 30, 2020, we issued in a private placement an aggregate amount of 693,240 newly issued shares of our common stock for aggregate cash proceeds of $4.0 million.
Our principal demands for funds in both the short-term and long-term are for portfolio investments, for the payment of operating expenses, distributions to our investors, repurchases under our share repurchase program, and for the payment of principal and interest on our outstanding indebtedness. We may also from time to time enter into other agreements with third parties whereby third parties will contribute to specific investment opportunities. Other potential future sources of capital include proceeds from secured or unsecured financings from banks or other lenders, proceeds from private offerings, proceeds from the sale of investments, and undistributed funds from operations. However, our ability to incur additional debt will be dependent on a number of factors, including our degree of leverage, the value of our unencumbered assets, and borrowing restrictions that may be imposed by lenders.

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We intend to conduct annual tender offers pursuant to our share repurchase program. Our Board of Directors will consider the following factors, among others, in making its determination regarding whether to cause us to offer to repurchase shares and under what terms:
•
the effect of such repurchases on our qualification as a RIC (including the consequences of any necessary asset sales);
•
the liquidity of our assets (including fees and costs associated with disposing of assets);
•
our investment plans and working capital requirements;
•
the relative economies of scale with respect to our size;
•
our history in repurchasing shares or portions thereof; and
•
the condition of the securities markets.
We intend to conduct tender offers on an annual basis. We intend to continue to limit the number of shares to be repurchased in any calendar year to the lesser of (i) 10% of the weighted average number of shares outstanding in the prior calendar year or (ii) the number of shares of common stock the Company is able to repurchase with the proceeds received from the sale of shares of common stock under the DRIP during the relevant redemption period. In addition, in the event of a stockholder’s death or disability, any repurchases of shares made in connection with a stockholder’s death or disability may be included within the overall limitation imposed on tender offers during the relevant redemption period, which provides that we may limit the number of shares to be repurchased during any redemption period to the number of shares of common stock we are able to repurchase with the proceeds received from the sale of shares of common stock under the DRIP during such redemption period.
Distributions
For the period from January 1, 2019 to March 29, 2020, the Company’s Board of Directors had authorized, and had declared, cash distributions payable on a monthly basis to stockholders of record at a distribution rate of $0.00178082 per day, which is equivalent to approximately $0.65 annually, per share of common stock, except for 2020 where the daily distribution rate was $0.00177596 per day to accurately reflect 2020 being a leap year. Effective April 21, 2020, the Board of Directors of the Company approved a transition in the timing of its distributions to holders of the Company's common stock from a monthly to a quarterly basis. On June 26, 2020, the Board declared a regular quarterly cash dividend of $0.10 per share of the Company's common stock, payable on July 6, 2020 to stockholders of record as of June 30, 2020. On September 25, 2020, the Board declared a regular quarterly cash dividend of $0.10 per share of the Company's common stock, payable on October 1, 2020 to stockholders of record as of September 30, 2020.
The amount of each such distribution is subject to the discretion of the Board of Directors and applicable legal restrictions related to the payment of distributions. The Company calculates each stockholder’s specific distribution amount for the quarter using record and declaration dates. The distributions are payable by the fifth day following each record date.
The table below shows the components of the distributions we have declared and/or paid during the nine months ended September 30, 2020 and 2019 (dollars in thousands).
 
For the nine months ended September 30,
 
2020
 
2019
Distributions declared
$
70,528

 
$
92,357

Distributions paid
$
65,786

 
$
92,757

Portion of distributions paid in cash
$
48,129

 
$
66,170

Portion of distributions paid in DRIP shares
$
17,657

 
$
26,587

As of September 30, 2020, we had $15.2 million of distributions accrued and unpaid. As of December 31, 2019, we had $10.5 million of distributions accrued and unpaid.

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We may fund our cash distributions to stockholders from any sources of funds available to us, including offering proceeds, borrowings, net investment income from operations, capital gain proceeds from the sale of assets, and non-capital gain proceeds from the sale of assets. We have not established limits on the amount of funds we may use from available sources to make distributions. We may have distributions which could be characterized as a return of capital for tax purposes. During the nine months ended September 30, 2020 and 2019, no portion of our distributions was characterized as return of capital for tax purposes. The specific tax characteristics of our distributions made in respect of our anticipated fiscal year ending December 31, 2020 will be reported to stockholders shortly after the end of the calendar year 2020 as well as in our periodic reports with the SEC. Stockholders should read any written disclosure accompanying a distribution payment carefully and should not assume that the source of any distribution is our ordinary income or gain. Moreover, you should understand that any such distributions were not based on our investment performance and can only be sustained if we achieve positive investment performance in future periods and/or our Adviser continues to make such reimbursements. There can be no assurance that we will achieve the performance necessary to sustain our distributions or that we will be able to pay distributions at all.
The following table sets forth the distributions declared during the nine months ended September 30, 2020 and 2019 (dollars in thousands):
 
For the nine months ended September 30,
 
2020
 
2019
Distributions
$
70,528

 
$
92,357

Total distributions
$
70,528

 
$
92,357

Taxation as a RIC
We have elected to be treated as a RIC under Subchapter M of the Code commencing with our tax year ended December 31, 2011 and intend to maintain our qualification as a RIC thereafter. As a RIC, we generally will not be subject to corporate-level U.S. federal income taxes on any income that we distribute as dividends for U.S. federal income tax purposes to our stockholders. To maintain our qualification as a RIC, we must, among other things, meet certain source-of-income and asset diversification requirements. In addition, in order to maintain RIC tax treatment, we must distribute to our stockholders, for each tax year, an amount equal to at least 90% of our “investment company taxable income,” which is generally our net ordinary income plus the excess, if any, of realized net short-term capital gain over realized net long-term capital loss and determined without regard to any deduction for dividends paid, or the annual distribution requirement. Even if we qualify as a RIC, we generally will be subject to corporate-level U.S. federal income tax on our undistributed taxable income and could be subject to state, local, and foreign taxes.
Additionally, in order to avoid the imposition of a U.S. federal excise tax, we are required to distribute, in respect of each calendar year, dividends to our stockholders of an amount at least equal to the sum of 98% of our calendar year net ordinary income (taking into account certain deferrals and elections); 98.2% of our capital gain net income (adjusted for certain ordinary losses) for the one year period ending on October 31 of such calendar year; and any net ordinary income and capital gain net income for preceding calendar years that were not distributed during such calendar years and on which we previously did not incur any U.S. federal income tax. If we fail to qualify as a RIC for any reason and become subject to corporate tax, the resulting corporate taxes could substantially reduce our net assets, the amount of income available for distribution and the amount of our distributions. Such a failure would have a material adverse effect on us and our stockholders. In addition, we could be required to recognize unrealized gains, incur substantial taxes and interest and make substantial distributions in order to re-qualify as a RIC. We cannot assure stockholders that they will receive any distributions.
Related Party Transactions and Agreements
Private Placement in connection with FT Transaction
On February 1, 2019, Franklin Templeton acquired BSP, including BSP's 100% ownership interest in our Advisor (the "FT Transaction"). In connection with the FT Transaction, on November 1, 2018, we issued approximately 6.1 million and 4.9 million shares of our common stock to Franklin Resources, Inc. and BSP, respectively, at a purchase price of $8.20 per share in a private placement in reliance on Section 4(a)(2) of the Securities Act. As a result of this issuance, the Company received aggregate cash proceeds of $90.0 million.

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Investment Advisory Agreement
We entered into an Investment Advisory Agreement as of February 1, 2019, which was approved by the Board of Directors for a two year term, under which the Adviser, subject to the overall supervision of our Board of Directors manages the day-to-day operations of, and provides investment advisory services to us. The Adviser and its affiliates also provide investment advisory services to other funds that have investment mandates that are similar, in whole and in part, with ours. The Adviser and its affiliates serve as investment adviser or sub-adviser to private funds and registered open-end funds, and serves as an investment adviser to a public real estate investment trust. The Adviser’s policies are designed to manage and mitigate the conflicts of interest associated with the allocation of investment opportunities. In addition, any affiliated fund currently formed or formed in the future and managed by the Adviser or its affiliates may have overlapping investment objectives with our own and, accordingly, may invest in asset classes similar to those targeted by us. However, in certain instances due to regulatory, tax, investment, or other restrictions, certain investment opportunities may not be appropriate for either us or other funds managed by the Adviser or its affiliates.
Prior to February 1, 2019, our Adviser provided investment advisory and management services under the Prior Investment Advisory Agreement, effective November 1, 2016, and most recently re-approved by the Board in August 2018. The terms of the Prior Investment Advisory Agreement were materially identical to the Investment Advisory Agreement. The Prior Investment Advisory Agreement automatically terminated upon the indirect change of control of the Adviser on the consummation of the FT Transaction.
Administration Agreement
On November 1, 2016, we entered into the Administration Agreement with BSP, pursuant to which BSP provides us with office facilities and administrative services. The Administration Agreement may be terminated by either party without penalty upon not less than 60 days’ written notice to the other. For the three and nine months ended September 30, 2020, the Company incurred $0.6 million and $1.4 million, respectively, in administrative service fees under the Administration Agreement. For the three and nine months ended September 30, 2019, the Company incurred $0.6 million and $1.8 million, respectively, in administrative service fees under the Administration Agreement.
Co-Investment Relief
The 1940 Act generally prohibits BDCs from entering into negotiated co-investments with affiliates absent an order from the SEC permitting the BDC to do so. The SEC staff has granted us exemptive relief that allows it to enter into certain negotiated co-investment transactions alongside other funds managed by the Adviser or its affiliates (“Affiliated Funds”) in a manner consistent with our investment objective, positions, policies, strategies, and restrictions as well as regulatory requirements and other pertinent factors, subject to compliance with certain conditions (the “Order”). Pursuant to the Order, we are permitted to co-invest with our affiliates if a “required majority” (as defined in Section 57(o) of the 1940 Act) of our eligible directors make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the transactions, including the consideration to be paid, are reasonable and fair to us and our stockholders and do not involve overreaching in respect of us or our stockholders on the part of any person concerned, and (2) the transaction is consistent with the interests of our stockholders and is consistent with our investment objective and strategies.
Borrowings
We are only allowed to borrow money such that our asset coverage, which, as defined in the 1940 Act, measures the ratio of total assets less total liabilities not represented by senior securities to total borrowings, equals at least 200% after such borrowing, with certain limited exceptions. We are continually exploring additional forms of alternative debt financing which could include new or expanded credit facilities or the issuance of debt securities. We may use borrowed funds, known as “leverage,” to make investments and to attempt to increase returns to our stockholders by reducing our overall cost of capital. We currently have credit facilities with Wells Fargo, JPM, Citi and MassMutual and have sold $310.0 million in aggregate principal of unsecured notes.
Wells Fargo Credit Facility
On July 24, 2012, the Company, through Funding I, entered into the Existing Wells Fargo Credit Facility. As a result of the July 7th Amendment, the Existing Wells Fargo Credit Facility was amended to decrease the total aggregate principal amount of borrowings from $600.0 million on a committed basis to $575.0 million. Prior to the July 7th Amendment, the facility was priced at one-month LIBOR, with no LIBOR floor, plus a spread ranging between 1.65% and 2.50% per annum. After the July 7th Amendment, the Existing Wells Fargo Credit Facility was priced at one-month LIBOR, with no LIBOR floor, plus a spread of 2.75% per annum. Interest was payable quarterly in arrears. Funding I was subject to a non-usage fee to the extent the aggregate principal amount available under the Existing Wells Fargo Credit Facility has not been borrowed. The non-usage fee per annum was 0.50% for the first 25% of the unused balance and 2.0% for the portion of the unused balance that exceeds 25%, except for the period from March 15, 2019 through June 15, 2019, where the non-usage fee per annum was 0.50% on any principal amount unused.
On August 28, 2020, the Company refinanced the Existing Wells Fargo Credit Facility with (i) the New Wells Fargo Credit Facility and (ii) the JPM Credit Facility.

84


The New Wells Fargo Credit Facility provides for borrowings of up to $300.0 million through August 28, 2023, and any amounts borrowed under the New Wells Fargo Credit Facility will mature on August 28, 2025. The New Wells Fargo Credit Facility is priced at three-month LIBOR, with a LIBOR floor of zero, plus a spread calculated based upon the composition of loans in the collateral pool, which will not exceed 2.75% per annum. Interest is payable quarterly in arrears. Funding I will be subject to a non-usage fee to the extent the commitments available under the New Wells Fargo Credit Facility have not been borrowed. The non-usage fee per annum is 0.50% for the first 25% of the unused balance and 2.0% for the portion of the unused balance that exceeds 25%. Funding I paid a structuring fee and incurred other customary costs and expenses in connection with the New Wells Fargo Credit Facility.
Funding I’s obligations under the New Wells Fargo Credit Facility are secured by a first priority security interest in substantially all of the assets of Funding I, including its portfolio of investments and the Company’s equity interest in Funding I. The obligations of Funding I under the New Wells Fargo Credit Facility are non-recourse to the Company.
In connection with the New Wells Fargo Credit Facility, the Company and Funding I have made certain representations and warranties and are required to comply with various covenants and other customary requirements. The New Wells Fargo Credit Facility contains customary default provisions pursuant to which the administrative agent and the lenders under the New Wells Fargo Credit Facility may terminate the Company in its capacity as collateral manager/portfolio manager under the New Wells Fargo Credit Facility. Upon the occurrence of an event of default under the New Wells Fargo Credit Facility, the administrative agent or the lenders may declare the outstanding advances and all other obligations under the New Wells Fargo Credit Facility immediately due and payable.
JPM Credit Facility
On August 28, 2020, the Company, through 57th Street, entered into the JPM Credit Facility. The JPM Credit Facility provides for borrowings of up to $300.0 million through August 28, 2023, and any amounts borrowed under the JPM Credit Facility will mature on August 28, 2023 unless the administrative agent exercises its option to extend the maturity date to August 28, 2024. The JPM Credit Facility is priced at three-month LIBOR, with a LIBOR floor of zero, plus a spread of 2.75% per annum. Interest is payable quarterly in arrears. 57th Street will be subject to a non-usage fee to the extent the commitments available under the JPM Credit Facility have not been borrowed. The non-usage fee per annum is 0.50% until August 28, 2021, where the non-usage fee per annum will be 0.75% on any principal amount unused. 57th Street paid a structuring fee and incurred other customary costs and expenses in connection with the JPM Credit Facility.
57th Street’s obligations under the JPM Credit Facility are secured by a first priority security interest in substantially all of the assets of 57th Street, including its portfolio of investments and the Company’s equity interest in 57th Street. The obligations of 57th Street under the JPM Credit Facility are non-recourse to the Company.
In connection with the JPM Credit Facility, the Company and 57th Street have made certain representations and warranties and are required to comply with various covenants and other customary requirements. The JPM Credit Facility contains customary default provisions pursuant to which the administrative agent and the lenders under the JPM Credit Facility may terminate the Company in its capacity as collateral manager/portfolio manager under the JPM Credit Facility. Upon the occurrence of an event of default under the JPM Credit Facility, the administrative agent or the lenders may declare the outstanding advances and all other obligations under the JPM Credit Facility immediately due and payable.
Citi Credit Facility
On June 27, 2014, the Company, through a wholly-owned, special purpose financing subsidiary, CB Funding, entered into a credit facility as amended from time to time, (the “Citi Credit Facility”) with Citibank, N.A. ("Citi") as administrative agent and U.S. Bank as collateral agent, account bank, and collateral custodian. The Citi Credit Facility provides for borrowings in an aggregate principal amount of up to $400.0 million on a committed basis, subject to the administrative agent’s right to approve the assets acquired by CB Funding and pledged as collateral under the Citi Credit Facility. The Citi Credit Facility's reinvestment period ends on May 31, 2021 and matures on May 31, 2022. On June 22, 2020, the Company, through CB Funding, entered into an amendment (the “Citi Amendment”) to the Citi Credit Facility. The Citi Amendment, among other things, makes certain changes to the Citi Credit Facility in connection with the upcoming LIBOR discontinuation. In connection with the Citi Credit Facility, CB Funding has made certain representations and warranties, is required to comply with various covenants, reporting requirements, and other customary requirements for similar facilities and is subject to certain customary events of default. Upon the occurrence and during the continuation of an event of default, Citi may declare the outstanding advances and all other obligations under the Citi Credit Facility immediately due and payable. During the continuation of an event of default, CB Funding must pay interest at a default rate.
The Citi Credit Facility contains customary default provisions for facilities of this type pursuant to which Citi may terminate the rights, obligations, power, and authority of the Company, in its capacity as servicer of the portfolio assets under the Citi Credit Facility, including, but not limited to, non-performance of Citi Credit Facility obligations, insolvency, defaults of certain financial covenants, and other events with respect to the Company that may be adverse to Citi and the secured parties under the Citi Credit Facility.

85


The Citi Credit Facility is priced at three month LIBOR plus a spread of 1.60% per annum through and including the last day of the investment period and 2.00% per annum thereafter. Interest is payable quarterly in arrears. CB Funding is subject to a non-usage fee to the extent the aggregate principal amount available under the Citi Credit Facility has not been borrowed. The non-usage fee per annum is 0.50%. Any amounts borrowed under the Citi Credit Facility along with any accrued and unpaid interest thereunder will mature, and will be due and payable, in three years.
MassMutual Credit Facility
On July 7, 2020, the Company and a wholly-owned, special purpose financing subsidiary of the Company, BDCA Asset Financing, LLC (“BDCA Asset Financing”), entered into a loan and servicing agreement (the “MassMutual Credit Facility”) with Massachusetts Mutual Life Insurance Company (“MassMutual”) as facility servicer and a lender and U.S. Bank National Association as collateral custodian, collateral administrator and administrative agent. The MassMutual Credit Facility provides for borrowings of up to $100.0 million on a committed basis, and, subject to satisfaction of certain conditions, contains an accordion feature whereby the Mass Mutual Credit Facility can be expanded to $150.0 million.
BDCA Asset Financing’s obligations under the MassMutual Credit Facility are secured by a first priority security interest in substantially all of the assets of BDCA Asset Financing, including its portfolio of investments and the Company’s equity interest in BDCA Asset Financing. The obligations of BDCA Asset Financing under the MassMutual Credit Facility are non-recourse to the Company.
The MassMutual Credit Facility provides for borrowings through December 31, 2021 and matures on December 31, 2025. The MassMutual Credit Facility is priced at three-month LIBOR, with a LIBOR floor of 0.75%, plus a spread of 5.0% per annum. Interest is payable quarterly in arrears. BDCA Asset Financing will be subject to a non-usage fee of 0.50% to the extent the aggregate principal amount available under the MassMutual Credit Facility has not been borrowed. BDCA Asset Financing paid a structuring fee and incurred other customary costs and expenses in connection with the MassMutual Credit Facility.
In connection with the MassMutual Credit Facility, the Company and BDCA Asset Financing have made certain representations and warranties and are required to comply with various covenants and other customary requirements. The MassMutual Credit Facility contains customary default provisions pursuant to which MassMutual may terminate the Company in its capacity as portfolio asset servicer of the portfolio assets under the MassMutual Credit Facility. Upon the occurrence of an event of default, MassMutual may declare the outstanding advances and all other obligations under the MassMutual Credit Facility immediately due and payable.
2020 Notes
On August 26, 2015, the Company entered into a Purchase Agreement relating to the Company’s sale of $100.0 million aggregate principal amount of its 6.00% fixed rate senior notes due September 1, 2020 (the “2020 Notes”). The 2020 Notes were subject to customary indemnification provisions and representations, warranties, and covenants. The net proceeds from the sale of the 2020 Notes were approximately $97.9 million. The 2020 Notes bore interest at a rate of 6.00% per year payable semi-annually.
On August 14, 2020, the Company redeemed all outstanding 2020 Notes.
2022 Notes
On December 14, 2017, the Company entered into a Purchase Agreement relating to the Company's sale of $150.0 million aggregate principal amount of its 4.75% fixed rate notes due December 30, 2022 (the “2022 Notes”). The 2022 Notes are subject to customary indemnification provisions and representations, warranties, and covenants. The net proceeds from the sale of the 2022 Notes were approximately $147.0 million. The 2022 Notes bear interest at a rate of 4.75% per year payable semi-annually.
2023 Notes
On May 11, 2018, the Company entered into a Purchase Agreement relating to the Company's sale of $60.0 million aggregate principal amount of its 5.375% fixed rate notes due May 30, 2023 (the “2023 Notes”). The 2023 Notes are subject to customary indemnification provisions and representations, warranties, and covenants. The net proceeds from the sale of the 2023 Notes were approximately $58.7 million. The 2023 Notes bear interest at a rate of 5.375% per year payable semi-annually.
2024 Notes
On December 3, 2019, the Company entered into a Purchase Agreement relating to the Company's sale of $100.0 million aggregate principal amount of its 4.85% fixed rate notes due December 15, 2024 (the “2024 Notes”). The 2024 Notes are subject to customary indemnification provisions and representations, warranties, and covenants. The net proceeds from the sale of the 2024 Notes were approximately $98.4 million. The 2024 Notes bear interest at a rate of 4.85% per year payable semi-annually.
See Note 5 to our consolidated financial statements contained in this Quarterly Report on Form 10-Q for a more detailed discussion of our borrowings.

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Contractual Obligations
The following table shows our payment obligations for repayment of debt and other contractual obligations as of September 30, 2020 (dollars in thousands):
 
 
 
Payment Due by Period
 
Total
 
Less than 1 year
 
1 - 3 years
 
3- 5 years
 
More than 5 years
Wells Fargo Credit Facility (1)
$
225,000

 
$
—

 
$
—

 
$
225,000

 
$
—

JPM Credit Facility (2)
240,000

 
—

 
240,000

 
—

 
—

Citi Credit Facility (3)
119,500

 
—

 
119,500

 
—

 
—

MassMutual Credit Facility (4)
—

 
—

 
—

 
—

 
—

2024 Notes (5)
98,997

 
—

 
—

 
98,997

 
—

2023 Notes (6)
59,827

 
—

 
59,827

 
—

 
—

2022 Notes (7)
149,629

 
—

 
149,629

 
—

 
—

Total contractual obligations
$
892,953

 
$
—

 
$
568,956

 
$
323,997

 
$
—

______________
(1) 
As of September 30, 2020, we had $75.0 million of unused borrowing capacity under the Wells Fargo Credit Facility, subject to borrowing base limits.
(2) 
As of September 30, 2020, we had $60.0 million of unused borrowing capacity under the JPM Credit Facility, subject to borrowing base limits.
(3) 
As of September 30, 2020, we had $280.5 million of unused borrowing capacity under the Citi Credit Facility, subject to borrowing base limits.
(4) 
As of September 30, 2020, we had $100.0 million of unused borrowing capacity under the MassMutual Credit Facility, subject to borrowing base limits.
(5) 
As of September 30, 2020, we had no unused borrowing capacity under the 2024 Notes.
(6) 
As of September 30, 2020, we had no unused borrowing capacity under the 2023 Notes.
(7) 
As of September 30, 2020, we had no unused borrowing capacity under the 2022 Notes.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources.
Commitments
In the ordinary course of business, we may enter into future funding commitments. As of September 30, 2020, the Company had unfunded commitments on delayed draw term loans of $21.2 million (including $18.7 million of non-discretionary commitments and $2.5 million of discretionary commitments), unfunded commitments on revolver term loans of $39.0 million, and unfunded equity capital discretionary commitments of $11.1 million. As of December 31, 2019, the Company had unfunded commitments on delayed draw term loans of $24.9 million (including $21.8 million of non-discretionary commitments and $3.1 million of discretionary commitments), unfunded commitments on revolver term loans of $28.0 million, and unfunded equity capital discretionary commitments of $21.4 million. Please refer to Note 7 - Commitments and Contingencies for further detail of these unfunded commitments. We maintain sufficient cash on hand and available borrowing capacity to fund such unfunded commitments.
Significant Accounting Estimates and Critical Accounting Policies
Our discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
While our significant accounting policies are more fully described in Note 2 - Summary of Significant Accounting Policies appearing elsewhere in this report, we believe the following accounting policies require the most significant judgment in the preparation of our consolidated financial statements.

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Valuation of Portfolio Investments
Portfolio investments are reported on the consolidated statements of assets and liabilities at fair value. On a quarterly basis we perform an analysis of each investment to determine fair value as follows:
Securities for which market quotations are readily available on an exchange are valued at the reported closing price on the valuation date. We may also obtain quotes with respect to certain of our investments from pricing services or brokers or dealers in order to value assets. When doing so, we determine whether the quote obtained is readily available according to U.S. GAAP to determine the fair value of the security. If determined readily available, we use the quote obtained.
Investments without a readily determined market value are primarily valued using a market approach, an income approach, or both approaches, as appropriate. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business). The income approach uses valuation techniques to convert future amounts (for example, cash flows or earnings) to a single present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. In following these approaches, the types of factors that we may take into account in fair value pricing our investments include, as relevant: 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, the markets in which the portfolio company does business, comparisons of financial ratios of peer companies that are public, M&A comparables, and enterprise values, among other factors. When available, broker quotations and/or quotations provided by pricing services are considered as an input in the valuation process.
For an investment in an investment fund that does not have a readily determinable fair value, we measure the fair value of the investment predominately based on the net asset value per share of the investment fund if the net asset value of the investment fund is calculated in a manner consistent with the measurement principles of ASC 946, as of our measurement date.
For investments in Collateralized Securities, both the assets and liabilities of each Collateralized Securities' capital structure are modeled. The model uses a waterfall engine to store the collateral data, generate collateral cash flows from the assets and distribute the cash flows to the liability structure based on the contractual priority of payments. The waterfall cash flows are discounted using rates that incorporate risk factors such as default risk, interest rate risk, downgrade risk, and credit spread risk, among others. In addition, broker quotations and/or comparable trade activity is considered as an input to determining fair value when available.
As part of our quarterly valuation process the Adviser may be assisted by one or more independent valuation firms engaged by us. The Board of Directors determines the fair value of each investment, in good faith, based on the input of the Adviser and the independent valuation firm(s) (to the extent applicable).
With respect to investments for which market quotations are not readily available, the Adviser undertakes a multi-step valuation process each quarter, as described below:
•
Each portfolio company or investment will be valued by the Adviser, potentially with assistance from one or more independent valuation firms engaged by our Board of Directors;
•
The independent valuation firm(s), if involved, will conduct independent appraisals and make an independent assessment of the value of each investment; and
•
The Board of Directors determines the fair value of each investment, in good faith, based on the input of the Adviser, independent valuation firm (to the extent applicable) and the audit committee of the Board of Directors.
Because there is not a readily available market value for most of the investments in its portfolio, we value substantially all of our portfolio investments at fair value as determined in good faith by our Board of Directors, as described herein. 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 our investments may fluctuate from period to period. Additionally, the fair value of our investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that we may ultimately realize. Further, such investments are generally subject to legal and other restrictions on resale or otherwise are less liquid than publicly traded securities. If we were required to liquidate a portfolio investment in a forced or liquidation sale, we could realize significantly less than the value at which we have recorded it.
Revenue Recognition
Interest Income
Investment transactions are accounted for on the trade date. Interest income, adjusted for amortization of premium and accretion of discount, is recorded on an accrual basis. Discount and premium on investments purchased are accreted/amortized over the expected life of the respective investment using the effective yield method. The amortized cost of investments represents the original cost adjusted for the accretion of discount and amortization of premium on investments.

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The Company has a number of investments in Collateralized Securities. Interest income from investments in the “equity” class of these Collateralized Securities (in the Company's case, preferred shares, or subordinated notes) is recorded based upon an estimation of an effective yield to expected maturity utilizing assumed cash flows in accordance with ASC 325-40-35, Beneficial Interests in Securitized Financial Assets ("ASC 325-40-35"). The Company monitors the expected cash inflows from its equity investments in Collateralized Securities, including the expected principal repayments. The effective yield is determined and updated quarterly. In accordance with ASC 325-40, investments in CLOs are periodically assessed for other-than-temporary impairment ("OTTI"). When the Company determines that a CLO has OTTI, the amortized cost basis of the CLO is written down as of the date of the determination based on events and information evaluated and that write-down is recognized as a realized loss.
Fee Income
Fee income, such as structuring fees, origination, closing, amendment fees, commitment, and other upfront fees are generally non-recurring and are recognized as revenue when earned, either upfront or amortized into income. Upon the payment of a loan or debt security, any prepayment penalties and unamortized loan origination, structuring, closing, commitment, and other upfront fees are recorded as income.
Payment-in-Kind Interest/Dividends
We hold debt and equity investments in our portfolio that contain PIK interest and dividend provisions. The PIK interest and PIK dividend, which represent contractually deferred interest or dividends that add to the investment balance that is generally due at maturity, are generally recorded on the accrual basis.
Non-accrual Income
Investments are placed on non-accrual status when principal or interest/dividend payments are past due and/or when there is reasonable doubt that principal or interest will be collected. Accrued cash and un-capitalized PIK interest is generally reversed when an investment is placed on non-accrual status. Previously capitalized PIK interest is not reversed when an investment is placed on non-accrual status. Interest payments received on non-accrual investments may be recognized as income or applied to principal depending upon management's judgment of the ultimate outcome. Non-accrual investments are restored to accrual status when past due principal and interest is paid and, in management's judgment, are likely to remain current.
Net Realized Gain or Loss and Net Change in Unrealized Appreciation or Depreciation
Gain or loss on the sale of investments is calculated using the specific identification method. We measure realized gain or loss by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, without regard to unrealized appreciation or depreciation previously recognized. Net change in unrealized appreciation or depreciation will reflect the change in portfolio investment values during the reporting period, including any reversal of previously recorded unrealized appreciation or depreciation, when a gain or loss is realized.
See Note 2 - Summary of Significant Accounting Policies to the consolidated financial statements for a description of other accounting policies and recently issued accounting pronouncements.
ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Interest Rate Risk
The market risk associated with financial instruments and derivative financial instruments is the risk of loss from adverse changes in market prices or interest rates. Our market risk arises primarily from interest rate risk relating to interest rate fluctuations. Many factors including governmental monetary and tax policies, domestic and international economic and political considerations, and other factors that are beyond our control contribute to interest rate risk. To meet our short and long-term liquidity requirements, we borrow funds at a combination of fixed and variable rates. Our interest rate risk management objectives are to limit the impact of interest rate changes in earnings and cash flows and to lower our overall borrowing costs. To achieve these objectives, from time to time, we may enter into interest rate hedge contracts such as swaps, collars, and treasury lock agreements, subject to the requirements of the 1940 Act, in order to mitigate our interest rate risk with respect to various debt instruments. While hedging activities may insulate us against adverse changes in interest rates, they may also limit our ability to participate in benefits of lower interest rates with respect to our portfolio of investments with fixed interest rates. During the periods covered by this report, we did not engage in interest rate hedging activities. We would not hold or issue these derivative contracts for trading or speculative purposes.

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As of September 30, 2020, our debt included variable-rate debt, bearing a weighted average interest rate of LIBOR plus 2.47% and fixed rate debt, bearing a weighted average interest rate of 4.90% with a total carrying value (net of deferred financing costs) of $879.0 million. The following table quantifies the potential changes in interest income net of interest expense should base interest rates increase or decrease by 100 or 200 basis points assuming that our current consolidated statement of assets and liabilities was to remain constant and no actions were taken to alter our existing interest rate sensitivity. Interest rate floors, if applicable, are not reflected in the sensitivity analysis below.
Change in Base Interest Rates
 
Estimated Percentage Change in Interest Income net of Interest Expense
(-) 200 Basis Points
 
(10.32
)%
(-) 100 Basis Points
 
(10.32
)%
Base Interest Rate
 
—
 %
(+) 100 Basis Points
 
10.32
 %
(+) 200 Basis Points
 
20.65
 %
Because we may borrow money to make investments, our net investment income may be dependent on the difference between the rate at which we borrow funds and the rate at which we invest these funds. In periods of increasing interest rates, our cost of funds would increase, which may reduce our net investment income. As a result, there can be no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income.
Capital Markets Risk
The prices of securities we hold may decline in response to certain events, including those directly involving the companies we invest in; conditions affecting the general economy; overall market changes; legislative reform; local, regional, national or global political, social or economic instability; and interest rate fluctuations. In addition, U.S. and global capital markets and credit markets have experienced a higher level of stress due to the global COVID-19 pandemic, which has resulted in an increase in the level of volatility across such markets and a general decline in value of the publicly-traded securities held by us.
ITEM 4.  CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
In accordance with Rules 13a-15(b) and 15d-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were (a) designed to ensure that the information we are required to disclose in our reports under the Exchange Act is recorded, processed, and reported in an accurate manner and on a timely basis and the information that we are required to disclose in our Exchange Act reports is accumulated and communicated to management to permit timely decisions with respect to required disclosure and (b) operating in an effective manner.
Change in Internal Control Over Financial Reporting
No change occurred in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended September 30, 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
As of September 30, 2020, we were not defendants in any material pending legal proceeding, and no such material proceedings are known to be contemplated. However, from time to time, we may be party to certain legal proceedings incidental to the normal course of our business including the enforcement of our rights under the contracts with our portfolio companies. Third parties may also seek to impose liability on us in connection with the activities of our portfolio companies.
ITEM 1A. RISK FACTORS
In addition to the other information set forth in this report, you should carefully consider the factors discussed below and in Part I., “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, which could materially affect our business, financial condition, and/or operating results. The risks described below and in our Annual Report on Form 10-K are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and/or operating results.

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Political, social and economic uncertainty, including uncertainty related to the COVID-19 pandemic, creates and exacerbates risks to us and certain of our portfolio companies.
Social, political, economic and other conditions and events may occur that create uncertainty and have significant impacts on issuers, industries, governments and other systems, including the financial markets, to which the Company and its investments are exposed. In addition, global economies and financial markets are increasingly interconnected, and political, economic and other conditions and events in one country, region, or financial market may adversely impact issuers in a different country, region or financial market. Furthermore, the occurrence of, among other events, natural or man-made disasters, severe weather or geological events, fires, floods, earthquakes, outbreaks of disease (such as COVID-19, avian influenza or H1N1/09), epidemics, pandemics, malicious acts, cyber-attacks, terrorist acts or the occurrence of climate change, also adversely impact our performance from time to time.
For example, in December 2019, a novel strain of coronavirus (also known as “COVID-19”) emerged in China and has since spread rapidly to other countries, including the United States. This outbreak has led, and for an unknown period of time will continue to lead, to disruptions in local, regional, national and global markets and economies affected thereby. The global impact of the outbreak is rapidly evolving, and many countries have reacted by instituting quarantines, prohibitions on travel and the closure of offices, businesses, schools, retail stores and other public venues. While several countries, as well as certain states in the United States, have liberalized public health restrictions as to further reopen their economies, recurring COVID-19 outbreaks have led to the re-introduction of such restrictions in certain states in the United States and globally and could continue to lead to the re-introduction of such restrictions elsewhere. With respect to the U.S. credit markets (in particular for middle market loans), this outbreak has resulted in, and until fully resolved is likely to continue to result in, the following, among other things: (i) government imposition of various forms of shelter in place orders and the closing of "non-essential" businesses, resulting in significant disruption to the businesses of many middle-market loan borrowers including supply chains, demand and practical aspects of their operations, as well as in furloughs or lay-offs of employees, and, while these effects are hoped to be temporary, some effects could be persistent or even permanent; (ii) increased draws by borrowers on revolving lines of credit; (iii) volatility and disruption of these markets including greater volatility in pricing and spreads; and (iv) rapidly evolving proposals and/or actions by state and federal governments to address problems being experienced by the markets and by businesses and the economy in general which may not necessarily adequately address the problems facing the loan market and middle market businesses.
This outbreak is having, and any future outbreaks could have, an adverse impact on the markets and the economy in general, which could have an impact on, among other things, the ability of lenders to originate loans, the volume and type of loans originated, and the volume and type of amendments and waivers granted to borrowers and remedial actions taken in the event of a borrower default, each of which could reduce the amount and quality of loans available for investment by us and returns to us, among other things. As of the date of this quarterly report on Form 10-Q, it is impossible to determine the scope of this outbreak, or any future outbreaks, how long any such outbreak, market disruption or uncertainties may last, the effect any governmental actions will have on us and certain of our portfolio companies.  Further, even after the pandemic subsides, the U.S. and other major economies may experience a recession.
Although it is impossible to predict the precise nature and consequences of these events, or of any political or policy decisions and regulatory changes occasioned by emerging events or uncertainty on applicable laws or regulations that impact us, certain of our portfolio companies and our investments, these types of events are impacting and may continue to impact us and such portfolio companies. The effects of a public health emergency may impact (i) the value and performance of us and certain of our portfolio companies, (ii) the ability of our borrowers to continue to meet loan covenants or repay loans provided by us on a timely basis or at all (iii) our ability to repay debt obligations, on a timely basis or at all, (iv) our ability to comply with certain regulatory requirements, such as asset coverage requirements, and/or covenants under our credit facilities and indentures, (v) our ability to continue to pay distributions or to make them at current levels or (vi) our ability to source, manage and divest investments and achieve our investment objectives, all of which could result in losses to us. We may also be harmed if the operations and effectiveness of any of our portfolio companies (or any of the key personnel or service providers of the foregoing) is compromised or if necessary or beneficial systems and processes are disrupted.
The capital markets are currently in a period of disruption and economic uncertainty. Such market conditions have adversely affected debt and equity capital markets, which have had, and may continue to have, a negative impact on our business and operations.
The U.S. capital markets have experienced significant volatility and disruption following the global outbreak of COVID-19 that began in December 2019, as evidenced by the volatility in global stock markets as a result of, among other things, uncertainty surrounding the COVID-19 pandemic and the fluctuating price of commodities such as oil. Despite actions of the U.S. federal government and foreign governments, these events have contributed to worsening general economic conditions that are negatively impacting the broader financial and credit markets and reducing the availability of debt and equity capital for the market as a whole. These conditions could continue for a prolonged period of time or worsen in the future.

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Significant changes or volatility in the capital markets may also have a negative effect on the valuations of our investments. While most of our investments are not publicly traded, applicable accounting standards require us to assume as part of our valuation process that our investments are sold in a principal market to market participants (even if we plan on holding an investment through its maturity). Our valuations, and particularly valuations of private investments and private companies, are inherently uncertain, may fluctuate over short periods of time and are often based on estimates, comparisons and qualitative evaluations of private information that may not show the complete impact of the COVID-19 pandemic and the resulting measures taken in response thereto.
Disruptions in the capital markets caused by the COVID-19 pandemic have increased the spread between the yields realized on risk-free and higher risk securities, resulting in illiquidity in parts of the capital markets. These and future market disruptions and/or illiquidity could harm our business, financial condition, results of operations and cash flows. Unfavorable economic conditions may also increase our funding costs, limit our access to the capital markets or result in a decision by lenders not to extend credit to us. These events have limited and could continue to limit our investment originations, limit our ability to grow and have a negative impact on our and certain of our portfolio companies’ operating results and the fair values of our debt and equity investments.
Because we borrow money, the potential for gain or loss on amounts invested in us will be magnified and may increase the risk of investing in us.
As of September 30, 2020, we had approximately $0.9 billion of debt financing. The use of borrowings, also known as leverage, increases the volatility of investments by magnifying the potential for gain or loss on invested equity capital. Because we use leverage to partially finance our investments, through borrowing from banks and other lenders, you will experience increased risks of investing in our common stock. If the value of our assets increases, leveraging would cause the net asset value attributable to our common stock to increase more sharply than it would have had we not leveraged. Conversely, if the value of our assets decreases, leveraging would cause our net asset value to decline more sharply than it otherwise would have had we not leveraged. Similarly, any increase in our income in excess of interest payable on the borrowed funds would cause our net income to increase more than it would without the leverage, while any decrease in our income would cause net income to decline more sharply than it would have had we not borrowed. Such a decline could negatively affect our ability to make common stock distribution payments. Leverage is generally considered a speculative investment technique.
Illustration. The following table illustrates the effect of leverage on returns from an investment in our common stock assuming various annual returns, net of expenses. The calculations in the table below are hypothetical and actual returns may be higher or lower than those appearing below. The calculation assumes (i) $2.8 billion in total assets, (ii) a weighted average cost of funds of 3.73%, (iii) $1.4 billion in debt outstanding (i.e., assumes that the $310.0 million principal amount of our unsecured notes sold and the full $1.1 billion available to us under our revolving credit facilities is outstanding), and (iv) $1.3 billion in stockholders’ equity. In order to compute the “Corresponding return to stockholders,” the “Assumed Return on Our Portfolio (net of expenses)” is multiplied by the assumed total assets to obtain an assumed return to us. From this amount, the interest expense is calculated by multiplying the assumed weighted average cost of funds by the assumed debt outstanding, and the product is subtracted from the assumed return to us in order to determine the return available to stockholders. The return available to stockholders is then divided by our stockholders’ equity to determine the “Corresponding return to stockholders.” Actual interest payments may be different.
Assumed Return on Our Portfolio (net of expenses)
 
(10)%
 
(5)%
 
—%
 
5%
 
10%
Corresponding return to stockholders (1)
 
(24.69)%
 
(14.30)%
 
(3.91)%
 
6.49%
 
16.88%
___________________
(1) In order for us to cover our hypothetical annual interest payments on indebtedness, we would need to achieve annual returns on our September 30, 2020 total assets of at least 1.88%.
As of September 30, 2020, the Wells Fargo Credit Facility provided for borrowings in an aggregate principal amount of up to $300.0 million on a committed basis, due August 28, 2025; the Citi Credit Facility provided for borrowings in an aggregate principal amount of up to $400.0 million on a committed basis, due May 31, 2022; the MassMutual Credit Facility provided for borrowings in an aggregate principal amount of up to $100.0 million on a committed basis, and, subject to satisfaction of certain conditions, contains an accordion feature whereby the MassMutual Facility can be expanded to $150.0 million, due December 31, 2025; the JPM Credit Facility provided for borrowings in an aggregate principal amount of up to $300.0 million on a committed basis, due August 28, 2023; the 2022 Notes provided borrowings in an aggregate principal amount of $150.0 million, due December 30, 2022; the 2023 Notes provided borrowings in an aggregate principal amount of $60.0 million, due May 30, 2023; and the 2024 Notes provided borrowings in an aggregate principal amount of $100.0 million, due December 15, 2024. See Item 7 in the Annual Report filed on Form 10-K for more information about these financing arrangements.

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The discontinuation of LIBOR and the transition to any new reference rates may affect the value of our LIBOR-indexed portfolio investments and may increase the cost of borrowing under our credit facilities, which in each case could affect our results of operations or financial condition.
On July 27, 2017, the U.K. Financial Conduct Authority (“FCA”) announced that LIBOR would be phased out of use after the 2021 calendar year, and the FCA has determined not to compel participant banks to submit LIBOR information after 2021. In response to the expected discontinuation of LIBOR, the Federal Reserve Board and the Federal Reserve Bank of New York formed the Alternative Reference Rates Committee (“ARRC”), a U.S. working group of private-sector representatives and financial regulators, to recommend an alternative reference rate to U.S. dollar LIBOR. Similarly, financial regulators in the UK, the European Union, Japan, and Switzerland formed working groups with the aim of recommending alternatives to LIBOR denominated in their local currencies. The ARRC has recommended the Secured Overnight Financing Rate (“SOFR”) together with a spread adjustment, as appropriate in the particular market, as its preferred alternative reference rate for U.S. dollar LIBOR. SOFR represents the average interest rate to borrow cash overnight collateralized by U.S. Treasury securities, is based on U.S. Treasury-backed repurchase transactions, and published daily by the Federal Reserve Bank.
At this time, it is not possible to predict with complete certainty how the discontinuation of LIBOR will affect financial instruments that utilize LIBOR, whether SOFR or any other alternative reference rates will attain general acceptance in the financial markets, or the pace at which any such transition away from LIBOR and to any other reference rate may occur. The process of phasing out LIBOR or any further changes or reforms to the determination or supervision of LIBOR or alternative reference rates, may result in a sudden or prolonged increase or decrease in reported LIBOR or alternative reference rates, which could have an adverse impact on the market for or value of any securities, loans, derivatives, and other financial obligations or extensions of credit indexed to LIBOR or such alternative reference rate that may be held by or due to us or on our overall financial condition or results of operations.
As of the date of this filing, our Wells Fargo Credit Facility, Citi Credit Facility, MassMutual Credit Facility, and JPM Credit Facility each have provisions which contemplate the transition away from LIBOR. Under the MassMutual Credit Facility, if BDCA Asset Financing, MassMutual or a majority of lenders determine, for a variety of enumerated reasons, that LIBOR cannot or may not be used, the Administrative Agent thereunder and BDCA Asset Financing will determine an alternative benchmark. Within five days of providing the amendment to all lenders, the amendment will take effect. If no alternative rate exists, the MassMutual Credit Facility will default to the higher of the Prime Rate and the Federal Funds Effective Rate plus 0.50%. The Wells Fargo Credit Facility, also provides a mechanism to notify the Administrative Agent that LIBOR is unavailable, defaulting to the Prime Rate or the Federal Funds Effective Rate plus 1.50%. Similarly, the Citi Credit Facility provides a mechanism to notify the Administrative Agent that LIBOR is unavailable, defaulting to the Prime Rate or the Federal Funds Effective Rate plus 1.50%. The JPM Credit Facility provides a mechanism to notify the Administrative Agent that LIBOR is unavailable, defaulting to the Prime Rate or the Federal Funds Effective Rate plus 1.50%. We may have to make amendments to all four credit facilities.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Issuer Purchases of Equity Securities
Repurchases of our common stock pursuant to our tender offer are as follows:
Period
 
Total Number of Shares Purchased
 
Average Price per Share
 
Cumulative Number of Shares Purchased as Part of Publicly Announced Plans or Programs
 
Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (in millions)
July 1, 2020 through July 31, 2020
 
—

 
$
—

 
—

 
—

August 1, 2020 through August 31, 2020
 
—

 
—

 
—

 
—

September 1, 2020 through September 30, 2020
 
—

 
—

 
—

 
—

ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
None.

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ITEM 6. EXHIBITS
The following exhibits are included, or incorporated by reference, in this Quarterly Report on Form 10-Q for the nine months ended September 30, 2020 (and are numbered in accordance with Item 601 of Regulation S-K).
Exhibit No.
Description
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


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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.
 
 
 
 
 
Signature
 
Title
 
Date
 
 
 
 
 
/s/ Richard J. Byrne   
Richard J. Byrne
 
Chief Executive Officer, President, and Chairman of the Board of Directors
(Principal Executive Officer)
 
November 12, 2020
/s/ Nina Kang Baryski         
Nina Kang Baryski
 
Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer)
 
November 12, 2020



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