Company Quick10K Filing
Capital Southwest
Market
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$0.00 4 $444
Financial Filings
10-Q 2019-11-05 Quarter: 2019-09-30
10-Q 2019-08-06 Quarter: 2019-06-30
10-K 2019-06-04 Annual: 2019-03-31
10-Q 2019-02-05 Quarter: 2018-12-31
10-Q 2018-11-07 Quarter: 2018-09-30
10-Q 2018-08-07 Quarter: 2018-06-30
10-K 2018-06-05 Annual: 2018-03-31
10-Q 2018-02-06 Quarter: 2017-12-31
10-Q 2017-11-07 Quarter: 2017-09-30
10-Q 2017-08-08 Quarter: 2017-06-30
10-K 2017-06-01 Annual: 2017-03-31
10-Q 2017-02-07 Quarter: 2016-12-31
10-Q 2016-11-08 Quarter: 2016-09-30
10-Q 2016-08-09 Quarter: 2016-06-30
10-K 2016-06-14 Annual: 2016-03-31
10-Q 2016-02-09 Quarter: 2015-12-31
10-Q 2015-11-09 Quarter: 2015-09-30
10-Q 2015-08-07 Quarter: 2015-06-30
10-K 2015-06-03 Annual: 2015-03-31
10-Q 2015-02-06 Quarter: 2014-12-31
10-Q 2014-11-07 Quarter: 2014-09-30
10-Q 2014-08-07 Quarter: 2014-06-30
10-K 2014-06-03 Annual: 2014-03-31
10-Q 2014-02-06 Quarter: 2013-12-31
10-Q 2013-11-07 Quarter: 2013-09-30
10-Q 2013-08-05 Quarter: 2013-06-30
10-K 2013-05-31 Annual: 2013-03-31
10-Q 2013-02-07 Quarter: 2012-12-31
10-Q 2012-11-09 Quarter: 2012-09-30
10-Q 2012-08-06 Quarter: 2012-06-30
10-K 2012-06-01 Annual: 2012-03-31
10-Q 2012-02-08 Quarter: 2011-12-31
10-Q 2011-10-28 Quarter: 2011-09-30
10-Q 2011-08-05 Quarter: 2011-06-30
10-K 2011-06-10 Annual: 2011-03-31
10-Q 2011-02-07 Quarter: 2010-12-31
10-Q 2010-11-04 Quarter: 2010-09-30
10-Q 2010-08-05 Quarter: 2010-06-30
10-K 2010-05-28 Annual: 2010-03-31
10-Q 2010-02-04 Quarter: 2009-12-31
Current Reports
8-K 2019-11-25 Other Events, Exhibits
8-K 2019-11-04 Earnings, Regulation FD, Exhibits
8-K 2019-10-08 Off-BS Arrangement, Exhibits
8-K 2019-09-27 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2019-08-20 Enter Agreement, Exhibits
8-K 2019-08-05 Earnings, Regulation FD, Exhibits
8-K 2019-08-01 Officers, Amend Bylaw, Shareholder Vote, Exhibits
8-K 2019-06-03 Earnings, Regulation FD, Exhibits
8-K 2019-05-23 Enter Agreement, Off-BS Arrangement, Other Events, Exhibits
8-K 2019-04-25 Amend Bylaw, Exhibits
8-K 2019-02-28 Other Events, Exhibits
8-K 2019-02-04 Earnings, Regulation FD, Exhibits
8-K 2019-01-31 Regulation FD, Exhibits
8-K 2018-12-21 Enter Agreement, Off-BS Arrangement, Other Events, Exhibits
8-K 2018-11-27 Other Events, Exhibits
8-K 2018-11-06 Earnings, Regulation FD, Exhibits
8-K 2018-10-04 Other Events, Exhibits
8-K 2018-08-30 Other Events, Exhibits
8-K 2018-08-06 Earnings, Regulation FD, Exhibits
8-K 2018-08-02 Shareholder Vote
8-K 2018-06-07 Other Events, Exhibits
8-K 2018-06-04 Earnings, Regulation FD, Exhibits
8-K 2018-05-14 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2018-04-30 Other Events, Exhibits
8-K 2018-04-16 Enter Agreement, Off-BS Arrangement, Other Events, Exhibits
8-K 2018-02-28 Other Events, Exhibits
8-K 2018-02-05 Earnings, Regulation FD, Exhibits
8-K 2018-01-31 Regulation FD, Exhibits
CSWC 2019-09-30
Content
Part I - Financial Information
Item 1. Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Item 3. Defaults Upon Senior Securities.
Item 4. Mine Safety Disclosures.
Item 5. Other Information.
Item 6. Exhibits
Exhibits
EX-31.1 cswc93019ex311.htm
EX-31.2 cswc93019ex312.htm
EX-32.1 cswc93019ex321.htm
EX-32.2 cswc93019ex322.htm

Capital Southwest Earnings 2019-09-30

CSWC 10Q Quarterly Report

Balance SheetIncome StatementCash Flow
Comparables ($MM TTM)
Ticker M Cap Assets Liab Rev G Profit Net Inc EBITDA EV G Margin EV/EBITDA ROA
AIN 2,606 1,458 807 1,030 378 110 244 2,872 37% 11.8 8%
CSWC 444 668 8 11 0 0 1 362 0% 613.5 0%
CLAR 443 217 49 221 78 11 17 458 35% 27.2 5%
UFI 341 592 199 709 66 2 43 430 9% 9.9 0%
CULP 231 224 60 300 53 6 14 186 18% 13.3 3%
CRWS 46 55 13 77 23 6 8 43 30% 5.0 11%
RAND
GLAD
AMAL
10-Q 1 cswc9301910q.htm 10-Q Document
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, 2019

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ……………..to ……………..

Commission File Number: 814-00061

CAPITAL SOUTHWEST CORPORATION
(Exact name of registrant as specified in its charter)

Texas
 
75-1072796
(State or other jurisdiction of incorporation
or organization)
 
(I.R.S. Employer
Identification No.)


5400 Lyndon B Johnson Freeway, Suite 1300, Dallas, Texas
 
75240
(Address of principal executive offices)
 
(Zip Code)

Registrant's telephone number, including area code: (214) 238-5700

Securities registered pursuant to Section 12(b) of the Act:
 
 
 
Title of Each Class
Trading Symbol(s)
Name of Each Exchange on Which Registered
Common Stock, $0.25 par value per share
CSWC
The Nasdaq Global Select Market
5.95% Notes due 2022
CSWCL
The Nasdaq Global Select Market

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       

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See 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
¨
Accelerated filer
x
Non-accelerated filer
¨
Smaller reporting company
¨
Emerging growth company
¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes        No X

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

17,927,329 shares of Common Stock, $0.25 value per share, as of November 1, 2019.


TABLE OF CONTENTS

 
 
 
 
Page
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 




PART I – FINANCIAL INFORMATION


Item 1.
Consolidated Financial Statements
CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
(In thousands, except shares and per share data)
 
 
 
 
 
September 30,
 
March 31,
 
2019
 
2019
 
(Unaudited)
 
 
Assets
 
 
 
Investments at fair value:
 
 
 
Non-control/Non-affiliate investments (Cost: $343,790 and $305,596, respectively)
$
339,357

 
$
304,663

Affiliate investments (Cost: $80,948 and $79,277, respectively)
83,602

 
80,905

Control investments (Cost: $73,415 and $93,182, respectively)
115,917

 
138,503

Total investments (Cost: $498,153 and $478,055, respectively)
538,876

 
524,071

Cash and cash equivalents
30,019

 
9,924

Receivables:
 
 
 
Dividends and interest
8,563

 
9,252

Escrow
418

 
370

Other
758

 
1,244

Income tax receivable
154

 
183

Deferred tax asset
1,628

 
1,807

Debt issuance costs (net of accumulated amortization of $2,191 and $1,814, respectively)
3,209

 
3,364

Other assets
1,408

 
1,628

Total assets
$
585,033

 
$
551,843

 
 
 
 
Liabilities
 
 
 
December 2022 Notes (Par value: $77,136 and $77,136, respectively)
$
75,564

 
$
75,099

October 2024 Notes (Par value: $65,000 and $0, respectively)
63,585

 
—

Credit facility
108,000

 
141,000

Other liabilities
5,791

 
6,708

Accrued restoration plan liability
3,023

 
3,073

Deferred tax liability
971

 
—

Total liabilities
256,934

 
225,880

 
 
 
 
Commitments and contingencies (Note 10)
 
 
 
 
 
 
 
Net Assets
 
 
 
Common stock, $0.25 par value: authorized, 40,000,000 shares; issued, 20,266,841 shares at September 30, 2019 and 19,842,528 shares at March 31, 2019
5,067

 
4,961

Additional paid-in capital
291,387

 
281,205

Total distributable earnings
55,582

 
63,734

Treasury stock - at cost, 2,339,512 shares
(23,937
)
 
(23,937
)
Total net assets
328,099

 
325,963

Total liabilities and net assets
$
585,033

 
$
551,843

Net asset value per share (17,927,329 shares outstanding at September 30, 2019 and 17,503,016 shares outstanding at March 31, 2019)
$
18.30

 
$
18.62



The accompanying Notes are an integral part of these Consolidated Financial Statements.

3

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except shares and per share data)
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Six Months Ended
 
September 30,
 
September 30,
 
2019
 
2018
 
2019
 
2018
Investment income:
 
 
 
 
 
 
 
Interest income:
 
 
 
 
 
 
 
Non-control/Non-affiliate investments
$
9,236

 
$
7,049

 
$
18,267

 
$
13,081

Affiliate investments
2,001

 
1,799

 
4,051

 
3,251

Control investments
—

 
384

 
265

 
543

Dividend income:
 
 
 
 
 
 
 
Non-control/Non-affiliate investments
68

 
2

 
155

 
25

Affiliate investments
—

 
44

 
19

 
82

Control investments
3,519

 
3,112

 
7,432

 
6,126

Interest income from cash and cash equivalents
12

 
5

 
28

 
9

Fees and other income
382

 
200

 
800

 
585

Total investment income
15,218

 
12,595

 
31,017

 
23,702

Operating expenses:
 
 
 
 
 
 
 
Compensation
1,708

 
1,963

 
3,729

 
3,873

Share-based compensation
685

 
482

 
1,522

 
957

Interest
3,716

 
3,109

 
7,522

 
5,482

Professional fees
462

 
407

 
1,088

 
895

Net pension expense
35

 
39

 
71

 
79

General and administrative
1,231

 
793

 
2,020

 
1,618

Total operating expenses
7,837

 
6,793

 
15,952

 
12,904

Income before taxes
7,381

 
5,802

 
15,065

 
10,798

Income tax expense
566

 
256

 
890

 
635

Net investment income
$
6,815

 
$
5,546

 
$
14,175

 
$
10,163

 
 
 
 
 
 
 
 
Realized gain
 
 
 
 
 
 
 
Non-control/Non-affiliate investments
$
267

 
$
17

 
$
1,316

 
$
217

Affiliate investments
16

 
77

 
17

 
77

Control investments
—

 
—

 
167

 
18,619

Total net realized gain on investments before income tax
283

 
94

 
1,500

 
18,913

 
 
 
 
 
 
 
 
Net unrealized (depreciation) appreciation on investments
 
 
 
 
 
 
 
Non-control/Non-affiliate investments
(809
)
 
1,877

 
(3,781
)
 
6,409

Affiliate investments
(181
)
 
(868
)
 
1,025

 
(1,539
)
Control investments
(2,904
)
 
(124
)
 
(2,819
)
 
(16,087
)
Income tax (provision) benefit
(475
)
 
63

 
(658
)
 
382

Total net unrealized (depreciation) appreciation on investments, net of tax
(4,369
)
 
948

 
(6,233
)
 
(10,835
)
 
 
 
 
 
 
 
 
Net realized and unrealized (losses) gains on investments
$
(4,086
)
 
$
1,042

 
$
(4,733
)
 
$
8,078

 
 
 
 
 
 
 
 
Net increase in net assets from operations
$
2,729

 
$
6,588

 
$
9,442

 
$
18,241

 
 
 
 
 
 
 
 
Pre-tax net investment income per share - basic and diluted
$
0.42

 
$
0.36

 
$
0.85

 
$
0.67

Net investment income per share – basic and diluted
$
0.38

 
$
0.34

 
$
0.80

 
$
0.63

Net increase in net assets from operations – basic and diluted
$
0.15

 
$
0.40

 
$
0.53

 
$
1.12

Weighted average shares outstanding – basic
17,770,011

 
16,318,737

 
17,653,607

 
16,249,892

Weighted average shares outstanding – diluted
17,770,011

 
16,323,477

 
17,653,607

 
16,254,365

The accompanying Notes are an integral part of these Consolidated Financial Statements.

4

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS
(Unaudited)
(In thousands)
 
 
 
 
 
2019
 
2018
 
 
 
 
Net assets, March 31
$
325,963

 
$
308,288

Operations:
 
 
 
Net investment income
7,360

 
4,617

Net realized gain on investments
1,217

 
18,819

Net unrealized depreciation on investments, net of tax
(1,864
)
 
(11,783
)
Net increase in net assets from operations
6,713

 
11,653

Dividends to shareholders ($0.49 and $0.89 per share, respectively)
(8,629
)
 
(14,503
)
Capital share transactions:
 
 
 
Change in restoration plan liability
7

 
11

Issuance of common stock
3,972

 
—

Exercise of employee stock options
—

 
1,457

Share-based compensation expense
837

 
475

Common stock withheld for payroll taxes upon vesting of restricted stock
(49
)
 
—

Increase (decrease) in net assets
2,851

 
(907
)
Net assets, June 30
$
328,814

 
$
307,381

Operations:
 
 
 
Net investment income
6,815

 
5,546

Net realized gain on investments
283

 
94

Net unrealized (depreciation) appreciation on investments, net of tax
(4,369
)
 
948

Net increase in net assets from operations
2,729

 
6,588

Dividends to shareholders ($0.50 and $0.44 per share, respectively)
(8,964
)
 
(7,191
)
Capital share transactions:
 
 
 
Change in pension plan funded status
8

 
12

Issuance of common stock
4,827

 
—

Exercise of employee stock options
—

 
576

Share-based compensation expense
685

 
482

(Decrease) increase in net assets
(715
)
 
467

Net assets, September 30
$
328,099

 
$
307,848


The accompanying Notes are an integral part of these Consolidated Financial Statements.

5

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
 
 
 
 
 
Six Months Ended
 
September 30,
 
2019
 
2018
Cash flows from operating activities
 
 
 
Net increase in net assets from operations
$
9,442

 
$
18,241

Adjustments to reconcile net increase in net assets from operations to net cash used in operating activities:
 
 
 
Purchases and originations of investments
(64,725
)
 
(167,697
)
Proceeds from sales and repayments of debt investments in portfolio companies
39,964

 
52,638

Proceeds from sales and return of capital of equity investments in portfolio companies
7,271

 
24,884

Payment of accreted original issue discounts
570

 
306

Depreciation and amortization
1,249

 
708

Net pension benefit
(34
)
 
(26
)
Realized gain on investments before income tax
(1,500
)
 
(18,913
)
Net unrealized depreciation (appreciation) on investments
5,575

 
11,217

Accretion of discounts on investments
(968
)
 
(687
)
Payment-in-kind interest and dividends
(889
)
 
(136
)
Stock option and restricted awards expense
1,522

 
957

Deferred income taxes
1,149

 
(201
)
Changes in other assets and liabilities:
 
 
 
Decrease (increase) in dividend and interest receivable
928

 
(3,088
)
Increase in escrow receivables
(48
)
 
—

Decrease in tax receivable
28

 
4,669

Decrease (increase) in other receivables
486

 
(62
)
(Increase) decrease in other assets
(478
)
 
443

Increase in taxes payable
413

 
—

Decrease in other liabilities
(231
)
 
(1,324
)
Decrease in payable for unsettled transaction
(1,158
)
 
—

Net cash used in operating activities
(1,434
)
 
(78,071
)
Cash flows from financing activities
 
 
 
Proceeds from common stock offering
8,937

 
—

Equity offering costs paid
(106
)
 
—

Borrowings under credit facility
47,000

 
117,000

Repayments of credit facility
(80,000
)
 
(30,000
)
Debt issuance costs paid
(360
)
 
(539
)
Proceeds from notes
63,700

 
18,081

Dividends to shareholders
(17,593
)
 
(26,219
)
Proceeds from exercise of employee stock options
—

 
2,034

Common stock withheld for payroll taxes upon vesting of restricted stock
(49
)
 
—

Net cash provided by financing activities
21,529

 
80,357

Net increase in cash and cash equivalents
20,095

 
2,286

Cash and cash equivalents at beginning of period
9,924

 
7,907

Cash and cash equivalents at end of period
$
30,019

 
$
10,193

Supplemental cash flow disclosures:
 
 
 
Cash paid for income taxes
$
—

 
$
11

Cash paid for interest
6,090

 
4,553


The accompanying Notes are an integral part of these Consolidated Financial Statements.


6

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
(Unaudited)
September 30, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Portfolio Company1
 
Type of Investment2
 
Industry
 
Current Interest Rate3
 
Acquisition Date14
 
Maturity
 
Principal
 
Cost
 
Fair Value4
Non-control/Non-affiliate Investments5
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
AAC HOLDINGS, INC.
 
First Lien16
 
Healthcare services
 
L+6.75% (Floor 1.00%)/Q, 4.00% PIK, Current Coupon 13.33%
 
6/28/2017
 
6/30/2023
 
$
9,079

 
$
8,916

 
$
6,809

 
 
First Lien - Priming Facility
 
 
 
L+11.00% (Floor 1.00%)/Q, Current Coupon 13.29%
 
3/21/2019
 
3/31/2020
 
1,170

 
1,164

 
1,170

 
 
 
 
 
 
 
 
 
 
 
 
 
 
10,080

 
7,979

ACE GATHERING, INC.
 
Second Lien15
 
Energy services (midstream)
 
L+8.50% (Floor 2.00%)/Q, Current Coupon 10.60%
 
12/13/2018
 
12/13/2023
 
9,813

 
9,639

 
9,724

ADAMS PUBLISHING GROUP, LLC
 
First Lien
 
Media, marketing & entertainment
 
L+7.50% (Floor 1.00%)/Q, Current Coupon 9.78%
 
7/2/2018
 
7/2/2023
 
11,386

 
11,195

 
11,193

 
 
Delayed Draw Term Loan10
 
 
 
L+7.50% (Floor 1.00%)/Q, Current Coupon 9.61%
 
7/2/2018
 
7/2/2023
 
361

 
335

 
355

 
 
 
 
 
 
 
 
 
 
 
 
 
 
11,530

 
11,548

AG KINGS HOLDINGS INC.8,16
 
First Lien
 
Food, agriculture & beverage
 
L+10.02% (Floor 1.00%)/M, Current Coupon 12.69%
 
8/4/2016
 
8/8/2021
 
9,308

 
9,194

 
6,958

ALLIANCE SPORTS GROUP, L.P.
 
Senior subordinated debt
 
Consumer products & retail
 
11.00%
 
8/1/2017
 
2/1/2023
 
10,100

 
9,963

 
9,666

 
 
3.88% preferred membership interest
 
 
 
—
 
8/1/2017
 
—
 
—

 
2,500

 
2,500

 
 
 
 
 
 
 
 
 
 
 
 
 
 
12,463

 
12,166

AMERICAN NUTS OPERATIONS LLC13
 
First Lien - Term Loan
 
Food, agriculture and beverage
 
L+9.50% (Floor 1.00%)/Q, Current Coupon 11.82%
 
4/10/2018
 
4/10/2023
 
17,281

 
17,018

 
16,340

 
 
First Lien - Term Loan C10
 
 
 
L+9.50% (Floor 1.00%)/Q, Current Coupon 11.82%
 
12/21/2018
 
4/10/2023
 
1,804

 
1,778

 
1,705

 
 
3,000,000 units of Class A common stock9
 
 
 
—
 
4/10/2018
 
—
 
—

 
3,000

 
733

 
 
 
 
 
 
 
 
 
 
 
 
 
 
21,796

 
18,778


7

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
(Unaudited)
September 30, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Portfolio Company1
 
Type of Investment2
 
Industry
 
Current Interest Rate3
 
Acquisition Date14
 
Maturity
 
Principal
 
Cost
 
Fair Value4
AMERICAN TELECONFERENCING SERVICES, LTD. (DBA PREMIERE GLOBAL SERVICES, INC.)
 
First Lien
 
Telecommunications
 
L+6.50% (Floor 1.00%)/Q, Current Coupon 8.69%
 
9/21/2016
 
12/8/2021
 
5,934

 
5,854

 
3,744

 
 
Second Lien
 
 
 
L+9.50% (Floor 1.00%)/Q, Current Coupon 11.84%
 
11/3/2016
 
6/6/2022
 
2,006

 
1,961

 
532

 
 
 
 
 
 
 
 
 
 
 
 
 
 
7,815

 
4,276

AMWARE FULFILLMENT LLC
 
First Lien
 
Distribution
 
L+9.50% (Floor 1.00%)/M, Current Coupon 11.59%
 
7/29/2016
 
12/31/2020
 
12,390

 
12,325

 
12,297

ASC ORTHO MANAGEMENT COMPANY, LLC13
 
Revolving Loan10
 
Healthcare services
 
L+7.50% (Floor 1.00%)
 
8/31/2018
 
8/31/2023
 
—

 
(23
)
 
—

 
 
First Lien
 
 
 
L+7.50% (Floor 1.00%)/Q, Current Coupon 9.82%
 
8/31/2018
 
8/31/2023
 
9,145

 
8,994

 
8,939

 
 
Second Lien
 
 
 
13.25% PIK
 
8/31/2018
 
12/1/2023
 
3,468

 
3,402

 
3,382

 
 
2,042 Common Units9
 
 
 
—
 
8/31/2018
 
—
 
—

 
750

 
569

 
 
 
 
 
 
 
 
 
 
 
 
 
 
13,123

 
12,890

BINSWANGER HOLDING CORP.
 
First Lien
 
Distribution
 
L+8.50% (Floor 1.00%)/M, Current Coupon 10.63%
 
3/9/2017
 
3/9/2022
 
11,770

 
11,640

 
11,446

 
 
900,000 shares of common stock
 
 
 
—
 
3/9/2017
 
—
 
—

 
900

 
786

 
 
 
 
 
 
 
 
 
 
 
 
 
 
12,540

 
12,232

BLASCHAK COAL CORP.
 
Second Lien15
 
Commodities & mining
 
L+10.00%/Q, 1.00% PIK, Current Coupon 13.32%
 
7/30/2018
 
7/30/2023
 
8,580

 
8,439

 
8,314

CALIFORNIA PIZZA KITCHEN, INC.
 
First Lien
 
Restaurants
 
L+6.00% (Floor 1.00%)/M, Current Coupon 8.53%
 
8/19/2016
 
8/23/2022
 
4,850

 
4,823

 
4,350

CAPITAL PAWN HOLDINGS, LLC
 
First Lien
 
Consumer products & retail
 
L+9.50%/Q, Current Coupon 11.82%
 
12/21/2017
 
7/8/2020
 
11,448

 
11,365

 
11,368


8

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
(Unaudited)
September 30, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Portfolio Company1
 
Type of Investment2
 
Industry
 
Current Interest Rate3
 
Acquisition Date14
 
Maturity
 
Principal
 
Cost
 
Fair Value4
CLICKBOOTH.COM, LLC
 
Revolving Loan10
 
Media, marketing & entertainment
 
L+8.50% (Floor 1.00%)
 
12/5/2017
 
12/5/2022
 
—

 
(13
)
 
—

 
 
First Lien
 
 
 
L+8.50% (Floor 1.00%)/Q, Current Coupon 10.82%
 
12/5/2017
 
12/5/2022
 
15,642

 
15,421

 
15,955

 
 
 
 
 
 
 
 
 
 
 
 
 
 
15,408

 
15,955

DANFORTH ADVISORS, LLC13
 
Revolving Loan10
 
Business services
 
L+7.25% (Floor 2.00%)
 
9/28/2018
 
9/28/2023
 
—

 
(16
)
 
—

 
 
First Lien
 
 
 
L+7.25% (Floor 2.00%)/Q, Current Coupon 9.57%
 
9/28/2018
 
9/28/2023
 
7,250

 
7,129

 
7,250

 
 
875 Class A equity units9
 
 
 
—
 
9/28/2018
 
—
 
—

 
875

 
1,274

 
 
 
 
 
 
 
 
 
 
 
 
 
 
7,988

 
8,524

DELPHI INTERMEDIATE HEALTHCO, LLC
 
First Lien
 
Healthcare services
 
L+7.50% (Floor 1.00%)/Q, Current Coupon 9.70%
 
11/3/2017
 
10/3/2022
 
10,527

 
10,455

 
9,538

DIGITAL RIVER, INC.
 
First Lien
 
Software & IT services
 
L+6.00% (Floor 1.00%)/Q, Current Coupon 8.12%
 
1/25/2016
 
2/12/2021
 
12,662

 
12,656

 
12,662

DRIVEN, INC.
 
First Lien
 
Business services
 
L+8.00% (Floor 2.00%)/Q, Current Coupon 10.31%
 
6/28/2019
 
6/28/2024
 
12,000

 
11,770

 
11,772

DUNN PAPER, INC.
 
Second Lien
 
Paper & forest products
 
L+8.75% (Floor 1.00%)/M, Current Coupon 10.79%
 
9/28/2016
 
8/25/2023
 
3,000

 
2,961

 
2,952

ENVIRONMENTAL PEST SERVICE MANAGEMENT COMPANY, LLC
 
First Lien
 
Consumer services
 
L+7.00%/Q, Current Coupon 9.32%
 
6/22/2018
 
6/22/2023
 
15,373

 
15,160

 
15,373

 
 
Delayed Draw Term Loan10
 
 
 
L+7.00%/Q, Current Coupon 9.32%
 
6/22/2018
 
6/22/2023
 
6,143

 
6,041

 
6,143

 
 
 
 
 
 
 
 
 
 
 
 
 
 
21,201

 
21,516

FAST SANDWICH, LLC
 
Revolving Loan10
 
Restaurants
 
L+9.00% (Floor 1.00%)
 
5/24/2018
 
—
 
—

 
(50
)
 
—

 
 
First Lien
 
 
 
L+9.00% (Floor 1.00%)/Q, Current Coupon 11.32%
 
5/24/2018
 
5/23/2023
 
3,197

 
3,154

 
3,133

 
 
 
 
 
 
 
 
 
 
 
 
 
 
3,104

 
3,133


9

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
(Unaudited)
September 30, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Portfolio Company1
 
Type of Investment2
 
Industry
 
Current Interest Rate3
 
Acquisition Date14
 
Maturity
 
Principal
 
Cost
 
Fair Value4
IENERGIZER LIMITED9
 
First Lien
 
Business services
 
L+6.00% (Floor 1.00%)/M, Current Coupon 8.06%
 
4/17/2019
 
4/17/2024
 
13,500

 
13,374

 
13,500

JVMC HOLDINGS CORP.
 
First Lien
 
Financial services
 
L+6.50% (Floor 1.00%)/M, Current Coupon 8.54%
 
2/28/2019
 
2/28/2024
 
8,640

 
8,562

 
8,640

LGM PHARMA, LLC13
 
First Lien
 
Healthcare products
 
L+8.50% (Floor 1.00%)/M, Current Coupon 10.60%
 
11/15/2017
 
11/15/2022
 
11,601

 
11,438

 
11,426

 
 
110,000 units of Class A common stock9
 
 
 
—
 
11/15/2017
 
—
 
—

 
1,100

 
821

 
 
 
 
 
 
 
 
 
 
 
 
 
 
12,538

 
12,247

LIGHTING RETROFIT INTERNATIONAL, LLC (DBA ENVOCORE)
 
First Lien
 
Environmental services
 
L+10.25% (Floor 1.00%)/Q, Current Coupon 12.35%
 
6/30/2017
 
6/30/2022
 
13,271

 
13,181

 
12,813

 
 
25,603 shares of Series C preferred stock
 
 
 
—
 
8/13/2018
 
—
 
—

 
26

 
29

 
 
396,825 shares of Series B preferred stock
 
 
 
—
 
6/30/2017
 
—
 
—

 
500

 
306

 
 
 
 
 
 
 
 
 
 
 
 
 
 
13,707

 
13,148

RESEARCH NOW GROUP, INC.
 
Second Lien
 
Business services
 
L+9.50% (Floor 1.00%)/M, Current Coupon 11.75%
 
12/8/2017
 
12/20/2025
 
10,500

 
9,870

 
10,384

SCRIP INC.8
 
First Lien
 
Healthcare products
 
L+9.95% (Floor 2.00%)/M, Current Coupon 11.96%
 
3/21/2019
 
3/21/2024
 
16,750

 
16,290

 
16,415

 
 
100 shares of common stock
 
 
 
—
 
3/21/2019
 
—
 
—

 
1,000

 
1,000

 
 
 
 
 
 
 
 
 
 
 
 
 
 
17,290

 
17,415

TAX ADVISORS GROUP, LLC13
 
143.3 Class A units9
 
Financial services
 
—
 
6/23/2017
 
—
 
—

 
541

 
1,053

TINUITI INC.
 
1,114 Preferred Units
 
Media, marketing & entertainment
 
12.00% PIK
 
2/1/2017
 
—
 
—

 
1,130

 
2,944

 
 
1,443 Common Units
 
 
 
—
 
2/1/2017
 
—
 
—

 
277

 
1,056

 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,407

 
4,000


10

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
(Unaudited)
September 30, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Portfolio Company1
 
Type of Investment2
 
Industry
 
Current Interest Rate3
 
Acquisition Date14
 
Maturity
 
Principal
 
Cost
 
Fair Value4
VISTAR MEDIA INC.
 
First Lien
 
Media, marketing & entertainment
 
L+8.00% (Floor 1.00%)/M, Current Coupon 10.09%
 
2/17/2017
 
4/3/2023
 
13,908

 
12,803

 
13,908

 
 
171,617 shares of Series A preferred stock
 
 
 
—
 
4/3/2019
 
—
 
—

 
1,874

 
3,698

 
 
Warrants (Expiration - April 3, 2029)
 
 
 
—
 
4/3/2019
 
—
 
—

 
620

 
1,648

 
 
 
 
 
 
 
 
 
 
 
 
 
 
15,297

 
19,254

VTX HOLDINGS, INC.8
 
First Lien
 
Software & IT services
 
L+8.95% (Floor 2.00%)/Q, Current Coupon 11.23%
 
7/23/2019
 
7/23/2024
 
20,075

 
19,529

 
19,784

 
 
1,000,000 Series A Preferred Units
 
 
 
—
 
7/23/2019
 
—
 
—

 
1,000

 
1,000

 
 
 
 
 
 
 
 
 
 
 
 
 
 
20,529

 
20,784

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Non-control/Non-affiliate Investments
 
 
 
 
 
 
 
 
 
 
 
 
 
$
343,790

 
$
339,357

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Affiliate Investments6
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CHANDLER SIGNS, LLC13
 
Senior subordinated debt
 
Business services
 
12.00%
 
1/4/2016
 
7/4/2021
 
$
4,569

 
$
4,532

 
$
4,569

 
 
1,500,000 units of Class A-1 common stock9
 
 
 
—
 
1/4/2016
 
—
 
—

 
1,500

 
2,714

 
 
 
 
 
 
 
 
 
 
 
 
 
 
6,032

 
7,283

DYNAMIC COMMUNITIES, LLC13
 
Revolving Loan10
 
Business services
 
L+8.00% (Floor 1.00%)
 
7/17/2018
 
7/17/2023
 
—

 
(4
)
 
—

 
 
First Lien
 
 
 
L+8.00% (Floor 1.00%)/M, Current Coupon 10.04%
 
7/17/2018
 
7/17/2023
 
10,920

 
10,744

 
10,833

 
 
2,000,000 Preferred Units9
 
 
 
—
 
7/17/2018
 
—
 
—

 
2,000

 
2,849

 
 
 
 
 
 
 
 
 
 
 
 
 
 
12,740

 
13,682


11

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
(Unaudited)
September 30, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Portfolio Company1
 
Type of Investment2
 
Industry
 
Current Interest Rate3
 
Acquisition Date14
 
Maturity
 
Principal
 
Cost
 
Fair Value4
ITA HOLDINGS GROUP, LLC13
 
Revolving Loan10
 
Transportation & logistics
 
L+9.00% (Floor 1.00%)/Q, Current Coupon 11.26%
 
2/14/2018
 
2/14/2023
 
1,719

 
1,684

 
1,723

 
 
First Lien - Term Loan
 
 
 
L+8.00% (Floor 1.00%)/Q, Current Coupon 10.32%
 
2/14/2018
 
2/14/2023
 
8,483

 
8,373

 
8,483

 
 
First Lien - Term B Loan
 
 
 
L+11.00% (Floor 1.00%)/Q, Current Coupon 13.32%
 
6/5/2018
 
2/14/2023
 
4,242

 
4,173

 
4,373

 
 
First Lien - PIK Note A
 
 
 
10.00% PIK
 
3/29/2019
 
2/14/2023
 
2,308

 
1,787

 
2,178

 
 
First Lien - PIK Note B
 
 
 
10.00% PIK
 
3/29/2019
 
2/14/2023
 
91

 
91

 
86

 
 
Warrants (Expiration - March 29, 2029)9
 
 
 
—
 
3/29/2019
 
—
 
—

 
538

 
2,909

 
 
9.25% Class A Membership Interest9
 
 
 
—
 
2/14/2018
 
—
 
—

 
1,500

 
2,245

 
 
 
 
 
 
 
 
 
 
 
 
 
 
18,146

 
21,997

ROSELAND MANAGEMENT, LLC
 
Revolving Loan10
 
Healthcare services
 
L+7.00% (Floor 2.00%)
 
11/9/2018
 
11/9/2023
 
—

 
(28
)
 
—

 
 
First Lien
 
 
 
L+7.00% (Floor 2.00%)/Q, Current Coupon 9.32%
 
11/9/2018
 
11/9/2023
 
10,421

 
10,265

 
10,421

 
 
10,000 Class A Units
 
 
 
—
 
11/9/2018
 
—
 
—

 
1,000

 
1,789

 
 
 
 
 
 
 
 
 
 
 
 
 
 
11,237

 
12,210

SIMR, LLC
 
First Lien
 
Healthcare services
 
L+9.00% (Floor 2.00%)/M, Current Coupon 11.13%
 
9/7/2018
 
9/7/2023
 
11,207

 
11,019

 
10,545

 
 
5,724,000 Class B Common Units
 
 
 
—
 
9/7/2018
 
—
 
—

 
5,724

 
3,322

 
 
 
 
 
 
 
 
 
 
 
 
 
 
16,743

 
13,867


12

CAPITAL SOUTHWEST CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
(Unaudited)
September 30, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Portfolio Company1
 
Type of Investment2
 
Industry
 
Current Interest Rate3
 
Acquisition Date14
 
Maturity
 
Principal
 
Cost
 
Fair Value4
ZENFOLIO INC.
 
Revolving Loan10
 
Business services
 
L+9.00% (Floor 1.00%)
 
7/17/2017
 
7/17/2022
 
—

 
(11
)
 
—

 
 
First Lien
 
 
 
L+9.00% (Floor 1.00%)/Q, Current Coupon 11.32%
 
7/17/2017
 
7/17/2022
 
14,406

 
14,161

 
14,017

 
 
190 shares of common stock
 
 
 
—
 
7/17/2017
 
—
 
—

 
1,900

 
546

 
 
 
 
 
 
 
 
 
 
 
 
 
 
16,050

 
14,563

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Affiliate Investments
 
 
 
 
 
 
 
 
 
 
 
 
 
$
80,948

 
$
83,602

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Control Investments7
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
I-45 SLF LLC9,11
 
80% LLC equity interest
 
Multi-sector holdings
 
—
 
10/20/2015
 
—
 
—

 
$
68,000

 
$
61,909

MEDIA RECOVERY, INC.11
 
800,000 shares of Series A convertible preferred stock
 
Industrial products
 
—
 
11/4/1997
 
—
 
—

 
800

 
7,979

 
 
4,000,002 shares of common stock
 
 
 
—
 
11/4/1997
 
—
 
—

 
4,615

 
46,029

 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,415

 
54,008

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Control Investments
 
 
 
 
 
 
 
 
 
 
 
 
 
$
73,415

 
$
115,917

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TOTAL INVESTMENTS12
 
 
 
 
 
 
 
 
 
 
 
 
 
$
498,153

 
$
538,876


1 
All debt investments are income-producing, unless otherwise noted. Equity investments are non-income producing, unless otherwise noted.
2 
All of the Company’s investments, unless otherwise noted, are pledged as collateral for the Company’s senior secured credit facility.
3 
The majority of investments bear interest at a rate that may be determined by reference to London Interbank Offered Rate (“LIBOR” or “L”) or Prime (“P”) and reset daily (D), monthly (M), quarterly (Q), or semiannually (S). For each the Company has provided the spread over LIBOR or Prime and the current contractual interest rate in effect at September 30, 2019. Certain investments are subject to a LIBOR or Prime interest rate floor. Certain investments, as noted, accrue payment-in-kind ("PIK") interest.
4 
The Company's investment portfolio is comprised entirely of debt and equity securities of privately held companies for which quoted prices falling within the categories of Level 1 and Level 2 inputs are not available. Therefore, the Company values all of its portfolio investments at fair value, as determined in good faith by the Board of Directors, using significant unobservable Level 3 inputs. Refer to Note 4 for further discussion.

13

5 
Non-Control/Non-Affiliate investments are generally defined by the Investment Company Act of 1940 (the “1940 Act”) as investments that are neither control investments nor affiliate investments. At September 30, 2019, approximately 63.0% of the Company’s investment assets were non-control/non-affiliate investments. The fair value of these investments as a percent of net assets is 103.4%.
6 
Affiliate investments are generally defined by the 1940 Act as investments in which between 5% and 25% of the voting securities are owned and the investments are not classified as control investments. At September 30, 2019, approximately 15.5% of the Company’s investment assets were affiliate investments. The fair value of these investments as a percent of net assets is 25.5%.
7 
Control investments are generally defined by the 1940 Act as investments in which more than 25% of the voting securities are owned. At September 30, 2019, approximately 21.5% of the Company’s investment assets were control investments. The fair value of these investments as a percent of net assets is 35.3%.
8