Company Quick10K Filing
MVC Capital
10-Q 2020-07-31 Filed 2020-09-09
10-Q 2020-04-30 Filed 2020-06-09
10-Q 2020-01-31 Filed 2020-03-09
10-K 2019-10-31 Filed 2020-01-14
10-Q 2019-07-31 Filed 2019-09-09
10-Q 2019-04-30 Filed 2019-06-10
10-Q 2019-01-31 Filed 2019-03-11
10-K 2018-10-31 Filed 2019-01-14
10-Q 2018-07-31 Filed 2018-09-10
10-Q 2018-04-30 Filed 2018-06-11
10-Q 2018-01-31 Filed 2018-03-12
10-K 2017-10-31 Filed 2018-01-16
10-Q 2017-07-31 Filed 2017-09-11
10-Q 2017-04-30 Filed 2017-06-08
10-Q 2017-01-31 Filed 2017-03-13
10-K 2016-10-31 Filed 2017-01-17
10-Q 2016-07-31 Filed 2016-09-09
10-Q 2016-04-30 Filed 2016-08-29
10-Q 2016-01-31 Filed 2016-05-16
10-K 2015-10-31 Filed 2016-05-16
10-Q 2015-07-31 Filed 2016-01-29
10-Q 2015-01-31 Filed 2015-12-01
10-K 2014-10-31 Filed 2015-10-15
10-Q 2014-10-31 Filed 2015-12-01
10-Q 2014-07-31 Filed 2014-09-09
10-Q 2014-04-30 Filed 2014-06-06
10-Q 2014-01-31 Filed 2014-03-12
10-K 2013-10-31 Filed 2014-01-13
10-Q 2013-07-31 Filed 2013-09-09
10-Q 2013-04-30 Filed 2013-06-10
10-Q 2013-01-31 Filed 2013-03-07
10-K 2012-10-31 Filed 2012-12-27
10-Q 2012-07-31 Filed 2012-09-10
10-Q 2012-04-30 Filed 2012-06-11
10-Q 2012-01-31 Filed 2012-03-12
10-K 2011-10-31 Filed 2012-01-12
10-Q 2011-07-31 Filed 2011-09-07
10-Q 2011-04-30 Filed 2011-06-02
10-Q 2011-01-31 Filed 2011-03-08
10-K 2010-10-31 Filed 2010-12-21
10-Q 2010-07-31 Filed 2010-09-09
10-Q 2010-04-30 Filed 2010-06-01
10-Q 2010-01-31 Filed 2010-03-11
8-K 2020-09-09 Earnings, Regulation FD, Other Events, Exhibits
8-K 2020-08-31 Enter Agreement, Off-BS Arrangement
8-K 2020-08-10 Enter Agreement, Regulation FD, Exhibits
8-K 2020-07-28 Officers
8-K 2020-07-15 Shareholder Vote, Other Events
8-K 2020-05-27
8-K 2020-04-16
8-K 2020-03-24
8-K 2020-02-25
8-K 2019-08-30
8-K 2019-06-24
8-K 2019-06-19
8-K 2019-04-30
8-K 2019-04-19
8-K 2019-01-29
8-K 2018-12-07
8-K 2018-10-30
8-K 2018-10-11
8-K 2018-09-17
8-K 2018-08-10
8-K 2018-02-26
8-K 2018-01-04

MVC 10Q Quarterly Report

Part I. Consolidated 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
EX-31.1 tm2030183d1_ex31-1.htm
EX-32.1 tm2030183d1_ex32-1.htm

MVC Capital Earnings 2020-07-31

Balance SheetIncome StatementCash Flow

10-Q 1 tm2030183-1_10q.htm FORM 10-Q

 

 

 

FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

 

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

 

For the quarterly period ended July 31, 2020

 

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

 

Commission File Number 814-00201

 

MVC Capital, Inc.

(Exact name of the registrant as specified in its charter)

 

DELAWARE   94-3346760
(State or other jurisdiction of   (I.R.S. Employer
incorporation or organization)   Identification No.)

 

287 Bowman Avenue    
2nd Floor    
Purchase, New York  
(Address of principal   10577
executive offices)   (Zip Code)

 

Registrant’s telephone number, including area code: (914) 701-0310

 

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 MVC New York Stock Exchange
Senior Notes MVCD New York Stock Exchange

 

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

 

Indicate by check mark whether the registrant has submitted electronically 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 þ 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. (Check one):

 

Large accelerated filer ¨ Accelerated filer þ 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. o

 

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

 

There were 17,725,118 shares of the registrant’s common stock, $.01 par value, outstanding as of September 9, 2020.

 

 

 

 

 

 

MVC Capital, Inc.

(A Delaware Corporation)

Index

 

    Page
     
Part I. Consolidated Financial Information  
     
  Item 1. Consolidated Financial Statements  
              Consolidated Balance Sheets  
              - July 31, 2020 (Unaudited) and October 31, 2019 3
              Consolidated Statements of Operations  
              - For the Nine Month Period Ended July 31, 2020 (Unaudited) and  
              - For the Nine Month Period Ended July 31, 2019 (Unaudited) 4
              Consolidated Statements of Operations  
              - For the Quarter May 1, 2020 to July 31, 2020 (Unaudited) and  
              - For the Quarter May 1, 2019 to July 31, 2019 (Unaudited) 5
              Consolidated Statements of Cash Flows  
              - For the Nine Month Period Ended July 31, 2020 (Unaudited) and  
              - For the Nine Month Period Ended July 31, 2019 (Unaudited) 6
              Consolidated Statements of Changes in Net Assets  
              - For the Nine Month Period Ended July 31, 2020 (Unaudited)  
              - For the Nine Month Period Ended July 31, 2019 (Unaudited) and  
              - For the Year ended October 31, 2019 7
              Consolidated Selected Per Share Data and Ratios  
              - For the Nine Month Period Ended July 31, 2020 (Unaudited)  
              - For the Nine Month Period Ended July 31, 2019 (Unaudited) and  
              - For the Year ended October 31, 2019 8
              Consolidated Schedules of Investments  
              - July 31, 2020 (Unaudited)  
              - October 31, 2019 9
              Notes to Consolidated Financial Statements 13
   Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations  45
  Item 3. Quantitative and Qualitative Disclosures about Market Risk 75
  Item 4. Controls and Procedures 92
     
Part II. Other Information 92
   
  Item 1. Legal Proceedings 92
  Item 1A. Risk Factors 92
  Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 93
  Item 3. Defaults Upon Senior Securities 93
  Item 4. Mine Safety Disclosures 93
  Item 5. Other Information 93
  Item 6. Exhibits 93
     
SIGNATURE 94
     
Exhibits

 

 

 

 

 

Part I. Consolidated Financial Information

 

Item 1. Consolidated Financial Statements

 

CONSOLIDATED FINANCIAL STATEMENTS

 

MVC Capital, Inc.

Consolidated Balance Sheets

 

   July 31,   October 31, 
   2020   2019 
   (Unaudited)     
ASSETS          
           
Assets          
Cash  $172,717   $1,321,648 
Restricted cash (cost $1,500,279 and $0)   1,500,279    - 
Restricted cash equivalents (cost $3,545,234 and $5,009,091)   3,545,234    5,009,091 
Cash equivalents (cost $46,655,085 and $5,368,190)   46,655,085    5,368,190 
Investments at fair value          
Non-control/Non-affiliated investments (cost $175,567,727 and $246,228,806)   146,947,497    229,322,498 
Affiliate investments (cost $82,754,183 and $81,465,911)   42,903,991    61,851,896 
Control investments (cost $79,378,267 and $87,972,462)   30,999,319    49,070,701 
Total investments at fair value (cost $337,700,177 and $415,667,180)   220,850,807    340,245,095 
Escrow receivables, net of reserves   -    1,135,000 
Dividends and interest receivables, net of reserves   6,148,063    4,273,018 
Deferred financing fees   391,832    614,586 
Fee and other receivables   1,912,146    4,013,714 
Prepaid expenses   393,452    182,298 
Prepaid taxes   37    - 
           
Total assets  $281,569,652   $362,162,640 
           
LIABILITIES AND SHAREHOLDERS' EQUITY          
           
Liabilities          
Senior notes II, net of deferred financing fees  $93,574,104   $112,703,490 
Revolving credit facility IV   -    15,100,000 
Incentive compensation payable   1,527,849    1,527,849 
Professional fees payable   496,806    241,518 
Management fee payable   679,829    1,038,431 
Accrued expenses and liabilities   228,534    770,205 
Interest payable   263,890    670,163 
Management fee payable - Asset Management   17,219    395,435 
Consulting fees payable   393,998    360,452 
Portfolio fees payable - Asset Management   896,293    668,849 
Guarantees/Letters of Credit   3,025,326    726,649 
Taxes payable   -    915 
Provision for incentive compensation (Note 11)   -    - 
           
Total liabilities   101,103,848    134,203,956 
           
Commitments and Contingencies (Note 9)          
           
Shareholders' equity          
Common stock, $0.01 par value; 150,000,000 shares authorized; 28,304,448 shares issued and 17,725,118 and 17,725,118 shares outstanding as of July 31, 2020 and October 31, 2019, respectively   283,044   283,044
Additional paid-in-capital   406,258,172    406,258,172 
Accumulated overdistributed earnings   (119,562,543)   (72,069,663)
Treasury stock, at cost, 10,579,330 and 10,579,330 shares held, respectively   (106,512,869)   (106,512,869)
           
Total shareholders' equity   180,465,804    227,958,684 
           
Total liabilities and shareholders' equity  $281,569,652   $362,162,640 
           
Net asset value per share  $10.18   $12.86 

 

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

 

3

 

 

MVC Capital, Inc.

Consolidated Statements of Operations

(Unaudited)

 

   For the Nine Month
Period
   For the Nine Month
Period
 
   November 1, 2019 to   November 1, 2018 to 
   July 31, 2020   July 31, 2019 
Operating Income:          
Dividend income          
Non-control/Non-affiliated investments  $-   $395,543 
Affiliate investments (net of foreign taxes withheld of $0 and $154,269, respectively) -     698,107  
Control investments   -    542,693 
           
Total dividend income   -    1,636,343 
           
Payment-in-kind dividend income          
Non-control/Non-affiliated investments   -    1,196,260 
           
Total payment-in-kind dividend income   -    1,196,260 
           
Interest income          
Non-control/Non-affiliated investments   13,917,627    14,347,352 
Affiliate investments   -    - 
Control investments   369,021    325,284 
           
Total interest income   14,286,648    14,672,636 
           
Payment-in-kind/Deferred interest income          
Non-control/Non-affiliated investments   5,573,486    3,307,666 
Affiliate investments   394,836    581,846 
Control investments   262,029    379,338 
           
Total payment-in-kind/Deferred interest income   6,230,351    4,268,850 
           
Fee income          
Non-control/Non-affiliated investments   59,298    89,299 
           
Total fee income   59,298    89,299 
           
Fee income - Asset Management 1          
Portfolio fees   412,915    347,914 
Management fees   224,074    292,243 
           
Total fee income - Asset Management   636,989    640,157 
           
Other income   4,580    - 
           
Total operating income   21,217,866    22,503,545 
           
Operating Expenses:          
Interest and other borrowing costs 2   6,193,860    7,277,321 
Management fee   3,561,308    4,746,192 
Legal fees   1,103,800    401,400 
Consulting fees   783,515    821,389 
Audit & tax preparation fees   714,000    979,980 
Other expenses   411,964    448,596 
Loss on extinguishment of debt6   345,419    - 
Portfolio company expense   327,004    - 
Expenses associated with Settlement Agreement   325,000    - 
Portfolio fees - Asset Management 1   309,686    260,936 
Directors' fees   276,914    282,448 
Insurance   231,068    206,334 
Management fee - Asset Management 1   168,055    219,182 
Administration   123,525    123,411 
Public relations fees   113,198    105,094 
Printing and postage   29,500    53,100 
Net Incentive compensation (Note 11)   -    - 
           
Total operating expenses   15,017,816    15,925,383 
           
Less: Voluntary expense waiver by Adviser 3   (112,500)   (112,500)
Less: Voluntary management fee waiver by Adviser 4   (1,335,491)   (1,779,822)
           
Total waivers   (1,447,991)   (1,892,322)
           
Net operating income before taxes   7,648,041    8,470,484 
           
Tax Expenses:          
Current tax expense   1,452    1,447 
           
Total tax expense   1,452    1,447 
           
Net operating income   7,646,589    8,469,037 
           
Net Realized and Unrealized Gain (Loss) on Investments:                        
           
Net realized gain (loss) on investments          
U.S. Treasury obligations   (85,886)   104,858 
Non-control/Non-affiliated investments   (530,611)   3,226,317 
Affiliate investments   (3,790,411)   (3,727,289)
Control investments   2,033,217    4,965,552 
Foreign currency   -    13,895 
           
Total net realized gain (loss) on investments   (2,373,691)   4,583,333 
           
Net unrealized appreciation (depreciation) on investments          
Non-control/Non-affiliated investments   (11,713,926)   (1,105,525)
Affiliate investments   (12,676,421)   10,356,198 
Control investments   (19,335,619)   (9,043,895)
           
Total unrealized appreciation (depreciation) on investments   (43,725,966)   206,778 
           
Net realized and unrealized gain (loss) on investments   (46,099,657)   4,790,111 
           
Net increase (decrease) in net assets resulting from operations $ (38,453,068 ) $ 13,259,148  
           
Net increase (decrease) in net assets per share resulting from operations    $  (2.17 )    $  0.75   
           
Dividends declared per share 5  $0.510   $0.450 
           
Weighted average number of shares outstanding   17,725,118    17,810,123 

  

1 These items are related to the management of the MVC Private Equity Fund, L.P. ("PE Fund").  Please see Note 10 "Management" for more information.

 

2 Interest and other borrowing costs includes $0 and $262,705 of interest associated with installment sale treatment on the USG&E note. Please see Note 12 "Tax Matters" for more information.

 

3 Reflects the nine month period portion of the TTG Advisers' voluntary waiver of $150,000 of expenses for the 2020 and 2019 fiscal years, that the Company would otherwise be obligated to reimburse TTG Advisers under the Advisory Agreement (the "Voluntary Waiver"). Please see Note 10 "Management" for more information.

 

4 Reflects the nine month period portion of the TTG Advisers' voluntary waiver of the management fee for the 2020 and 2019 Please see Note 10 "Management" for more information.

 

5 Please see Note 13 "Dividends and Distributions to Shareholders, Share Repurchase Program and Tender Offer" for more information.

 

6 Reflects $345,419 in unamortized deferred financing fees related to the Senior Notes II which were expensed at the time $20.0 million of the Senior Notes were redeemed.

 

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

 

4

 

 

 

MVC Capital, Inc.

Consolidated Statements of Operations

(Unaudited)

 

   For the Quarter   For the Quarter 
   May 1, 2020 to   May 1, 2019 to 
   July 31, 2020   July 31, 2019 
Operating Income:          
Dividend income          
Non-control/Non-affiliated investments  $-   $- 
Affiliate investments (net of foreign taxes withheld of $0 and $76,866, respectively)   -    - 
           
Total dividend income   -    - 
           
Payment-in-kind dividend income          
Non-control/Non-affiliated investments   -    - 
           
Total payment-in-kind dividend income   -    - 
           
Interest income          
Non-control/Non-affiliated investments   2,078,707    5,924,050 
Affiliate investments   -    - 
Control investments   108,191    109,618 
           
Total interest income   2,186,898    6,033,668 
           
Payment-in-kind/Deferred interest income          
Non-control/Non-affiliated investments   3,261,417    899,710 
Affiliate investments   134,679    140,621 
Control investments   -    132,648 
           
Total payment-in-kind/Deferred interest income   3,396,096    1,172,979 
           
Fee income          
Non-control/Non-affiliated investments   33,100    38,101 
           
Total fee income   33,100    38,101 
           
Fee income - Asset Management 1          
Portfolio fees   93,420    119,248 
Management fees   69,840    104,944 
           
Total fee income - Asset Management   163,260    224,192 
           
Other income   -    - 
           
Total operating income   5,779,354    7,468,940 
           
Operating Expenses:          
Interest and other borrowing costs 2   1,862,800    2,510,677 
Management fee   1,087,726    1,642,930 
Legal fees   780,000    123,000 
Portfolio company expense   327,004    - 
Expenses associated with Settlement Agreement   325,000    - 
Consulting fees   300,505    334,519 
Other expenses   201,750    140,763 
Audit & tax preparation fees   115,500    151,300 
Directors' fees   86,414    94,000 
Insurance   80,778    69,516 
Portfolio fees - Asset Management 1   70,065    89,436 
Management fee - Asset Management 1   52,379    78,708 
Administration   41,476    41,589 
Public relations fees   30,661    26,000 
Printing and postage   7,100    16,800 
           
Total operating expenses   5,369,158    5,319,238 
           
Less: Voluntary expense waiver by Adviser 3   (37,500)   (37,500)
Less: Voluntary management fee waiver by Adviser 4   (407,898)   (616,099)
           
Total waivers   (445,398)   (653,599)
           
Net operating income before taxes   855,594    2,803,301 
           
Tax Expenses:          
Current tax expense   482    485 
           
Total tax expense   482    485 
           
Net operating income   855,112    2,802,816 
           
Net Realized and Unrealized Gain (Loss) on Investments:          
           
Net realized gain (loss) on investments          
U.S. Treasury obligations   -    84,375 
Non-control/Non-affiliated investments   -    2,910 
Affiliate investments   (3,747,247)   (3,795,709)
Control investments   -    (218,992)
Foreign currency   -    11,733 
           
Total net realized loss on investments   (3,747,247)   (3,915,683)
           
Net unrealized appreciation (depreciation) on investments          
Non-control/Non-affiliated investments   1,061,645    (461,583)
Affiliate investments   5,596,414    3,491,912 
Control investments   (6,303,042)   (1,569,546)
           
Total unrealized appreciation (depreciation) on investments   355,017    1,460,783 
           
Net realized and unrealized gain (loss) on investments   (3,392,230)   (2,454,900)
           
Net increase (decrease) in net assets resulting from operations  $(2,537,118)  $347,916 
           
Net increase (decrease) in net assets per share resulting from operations  $(0.14)  $0.02 
           
Dividends declared per share 5  $0.170   $0.150 
           
Weighted average number of shares outstanding   17,725,118    17,725,118 

  

1 These items are related to the management of the MVC Private Equity Fund, L.P. ("PE Fund").  Please see Note 10 "Management" for more information.

 

2 Interest and other borrowing costs includes $0 and $86,285 of interest associated with installment sale treatment on the USG&E note. Please see Note 12 "Tax Matters" for more information.

 

3 Reflects the quarterly portion of the TTG Advisers' voluntary waiver of $150,000 of expenses for the 2020 and 2019 fiscal years, that the Company would otherwise be obligated to reimburse TTG Advisers under the Advisory Agreement (the "Voluntary Waiver"). Please see Note 10 "Management" for more information.

 

4 Reflects the quarterly portion of the TTG Advisers' voluntary waiver of the management fee for the 2020 and 2019 Please see Note 10 "Management" for more information.

 

5 Please see Note 13 "Dividends and Distributions to Shareholders, Share Repurchase Program and Tender Offer" for more information.

 

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

 

5

 

 

MVC Capital, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

 

   For the Nine Month
Period
   For the Nine Month
Period
 
   November 1, 2019 to   November 1, 2018 to 
   July 31, 2020   July 31, 2019 
Cash flows from Operating Activities:          
Net increase (decrease) in net assets resulting from operations  $(38,453,068)  $13,259,148 
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities:                                
Net realized gain   2,373,691    (4,583,333)
Net change in unrealized depreciation (appreciation)   43,725,966    (206,778)
Amortization of discounts and fees   (2,507,789)   (232,955)
Increase in accrued payment-in-kind dividends and interest   (3,629,098)   (5,143,943)
Amortization of deferred financing fees   785,457    968,257 
Loss on extinguishment of debt   345,419    - 
Changes in operating assets and liabilities:          
Dividends, interest and fees receivable   (1,875,045)   (629,649)
Fee and other receivables   2,101,568    16,738 
Escrow receivables, net of reserves   1,135,000    (116,000)
Prepaid expenses   (211,154)   49,900 
Prepaid taxes   (37)   - 
Other liabilities   (1,169,399)   322,658 
Purchases of equity investments   (1,870,978)   (4,268,340)
Purchases of debt instruments   (9,745,192)   (36,751,624)
Purchases of short-term investments   (24,999,410)   (49,991,103)
Proceeds from equity investments (1)   10,709,962    30,803,643 
Proceeds from debt instruments   82,685,527    3,395,440 
Sales/maturities of short-term investments   24,912,778    50,094,859 
           
Net cash provided by (used in) operating activities   84,314,198    (3,013,082)
           
Cash flows from Financing Activities:          
Repayments from senior notes   (20,000,000)   - 
Borrowings from revolving credit facility II   25,000,000    50,000,000 
Repayments from revolving credit facility II   (25,000,000)   (50,000,000)
Borrowings from revolving credit facility IV   -    26,100,000 
Repayments from revolving credit facility IV   (15,100,000)   (4,000,000)
Repurchase of common stock   -    (4,069,924)
Financing fees paid   -    (1,053,921)
Distributions paid to shareholders   (8,847,556)   (7,728,062)
Repurchases of common stock under dividend reinvestment plan   (192,256)   (269,711)
           
Net cash provided by financing activities   (44,139,812)   8,978,382 
           
Net change in cash, cash equivalents, and restricted cash for the period   40,174,386    5,965,300 
           
Cash, cash equivalents, and restricted cash, beginning of period  $11,698,929   $15,887,700 
           
Cash, cash equivalents, and restricted cash, end of period  $51,873,315   $21,853,000 

 

(1) For the nine month period ended July 31, 2019, proceeds from equity investments includes $1,018,000 from escrow receivables, net of reserves.

 

During the nine month periods ended July 31, 2020 and 2019 MVC Capital, Inc. paid $5,412,656 and $6,018,487 in interest expense, respectively.

 

During the nine month periods ended July 31, 2020 and 2019 MVC Capital, Inc. paid $2,404 and $1,616 in income taxes, respectively.

 

Non-cash activity:

 

During the nine month periods ended July 31, 2020 and 2019, MVC Capital, Inc. recorded payment in-kind dividend and interest of $3,629,098 and $5,143,943, respectively. This amount was added to the principal balance of the investments and recorded as dividend/interest income.

 

During the nine month periods ended July 31, 2020 and 2019, the Plan Agent purchased 23,812 and 29,543 shares of common stock in the open market in order to satisfy the reinvestment portion of our dividends.

 

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

 

6

 

 

 

MVC Capital, Inc.
Consolidated Statements of Changes in Net Assets
                     
          Accumulated        
For the Nine Month Period November 1, 2018 to July 31, 2019 (Unaudited)  Common
Stock
   Additional
Paid-In-Capital
   Overdistributed
Earnings
   Treasury
Stock
   Total Net
Asset Value
 
Balances at October 31, 2018  $283,044   $408,583,787   $(79,700,440)  $(102,442,945)  $226,723,446 
                          
Net operating income   -    -    8,469,037    -    8,469,037 
Accumulated net realized gain   -    -    4,583,333    -    4,583,333 
Net unrealized appreciation   -    -    206,778    -    206,778 
Dividends paid to stockholders   -    -    (7,997,773)   -    (7,997,773)
Issuance of common stock under dividend reinvestment plan   269,711    -    -    -    269,711 
Repurchase of common stock under dividend reinvestment plan   (269,711)   -    -    -    (269,711)
Repurchase of common stock   -    -    -    (4,069,924)   (4,069,924)
                          
Balances at July 31, 2019  $283,044   $408,583,787   $(74,439,065)  $(106,512,869)  $227,914,897 
                          
For the Nine Month Period November 1, 2019 to July 31, 2020 (Unaudited)                         
Balances at October 31, 2019  $283,044   $406,258,172   $(72,069,663)  $(106,512,869)  $227,958,684 
                          
Net operating income   -    -    7,646,589    -    7,646,589 
Accumulated net realized loss   -    -    (2,373,691)   -    (2,373,691)
Net unrealized depreciation   -    -    (43,725,966)   -    (43,725,966)
Dividends paid to stockholders   -    -    (9,039,812)   -    (9,039,812)
Issuance of common stock under dividend reinvestment plan   192,256    -    -    -    192,256 
Repurchase of common stock under dividend reinvestment plan   (192,256)   -    -    -    (192,256)
                          
Balances at July 31, 2020  $283,044   $406,258,172   $(119,562,543)  $(106,512,869)  $180,465,804 

 

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

 

7

 

 

MVC Capital, Inc.  
Consolidated Selected Per Share Data and Ratios  
                   
   For the Nine Month
Period
     For the Nine Month
Period
     For the   
   November 1, 2019 to     November 1, 2018 to     Year Ended   
   July 31, 2020     July 31, 2019     October 31, 2019   
   (Unaudited)     (Unaudited)         
Net asset value, beginning of period/year  $12.86     $12.46     $12.46   
                      
Income from operations:                     
Net operating income   0.43      0.48      0.65   
Net realized and unrealized gain (loss) on investments   (2.60)     0.27      0.27   
                      
Total gain (loss) from investment operations   (2.17)     0.75      0.92   
                      
Less distributions from:                     
Income   (0.51)     (0.45)     (0.62)  
                      
Total distributions   (0.51)     (0.45)     (0.62)  
                      
Capital share transactions                     
Anti-dilutive effect of share repurchase program   -      0.10      0.10   
                      
Total capital share transactions   -      0.10      0.10   
                      
Net asset value, end of period/year  $10.18     $12.86     $12.86   
                      
Market value, end of period/year  $6.46     $9.57     $8.77   
                      
Market discount   (36.54)%     (25.58)%     (31.80)%  
                      
Total Return - At NAV (a)   (17.79)%     6.91%     8.33%  
                      
Total Return - At Market (a)   (21.10)%     10.94%     3.64%  
                      
Ratios and Supplemental Data:                     
                      
Portfolio turnover ratio   5.55%     10.04%     11.48%  
                      
Net assets, end of period/year (in thousands)  $180,466     $227,915     $227,959   
                      
Ratios to average net assets:                     
Expenses including tax expense   8.80% (c)   8.32%(c)    8.39%  
Expenses excluding tax expense   8.80% (c)   8.32%(c)    8.39%  
                      
Net operating income before tax expense   4.96% (c)   5.02%(c)    5.13%  
Net operating income after tax expense   4.96% (c)   5.02%(c)    5.13%  
                      
Ratios to average net assets excluding waivers:                     
Expenses including tax expense   9.74% (c)   9.44%(c)    9.52%  
Expenses excluding tax expense   9.74% (c)   9.44%(c)    9.52%  
                      
Net operating income before tax expense   4.02% (c)   3.90%(c)    4.00%  
Net operating income after tax expense   4.02% (c)   3.90%(c)    4.00%  
                      
(a) Total annual return is historical and assumes changes in share price, reinvestments of all dividends and distributions, and no sales charge for the period/year.  
                      
(b) Supplemental Ratio information                     
                      
Ratios to average net assets: (b)                     
Expenses excluding incentive compensation   8.80% (c)   8.32%(c)    8.39%  
Expenses excluding incentive compensation, interest and other borrowing costs   4.78% (c)   4.00%(c)    4.12%  
                      
Net operating income before incentive compensation   4.96% (c)   5.02%(c)    5.13%  
Net operating income before incentive compensation, interest and other borrowing costs   8.98% (c)   9.34%(c)    9.40%  
                      
Ratios to average net assets excluding waivers: (b)                     
Expenses excluding incentive compensation   9.74% (c)   9.44%(c)    9.52%  
Expenses excluding incentive compensation, interest and other borrowing costs   5.72% (c)   5.13%(c)    5.25%  
                      
Net operating income before incentive compensation   4.02% (c)   3.90%(c)    4.00%  
Net operating income before incentive compensation, interest and other borrowing costs   8.04% (c)   8.21%(c)    8.27%  
                      
(c) Annualized.                     

 

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

 

8

 

 

 

MVC Capital, Inc.

Consolidated Schedule of Investments

July 31, 2020

(Unaudited)

 

Company  Industry  Investment  Acquistion Date  Principal   Cost   Fair Value 
Non-control/Non-affiliated investments- 81.43% (a, c, f, g)                        
Black Diamond Equipment Rentals, LLC  Equipment Rental  Second Lien Loan 12.5000% Cash,06/27/2022 (k, n)  12/28/17  $7,500,000   $7,266,844   $7,500,000 
      Warrants (d, n)  12/28/17   1    400,847    933,000 
                  7,667,691    8,433,000 
Custom Alloy Corporation  Manufacturer of Pipe Fittings and Forgings  Second Lien Loan 12.0000% Cash, 3.0000% PIK, 04/30/2022 (b, k, n)  10/31/14   33,137,484    33,137,484    26,248,833 
      Second Lien Loan 12.0000% Cash, 3.0000% PIK, 04/30/2022 (b, k, n)  10/31/14   6,253,813    6,253,813    4,953,764 
      Revolver 12.0000% Cash, 3.0000% PIK, 04/30/2021 (b, k, n)  07/01/19   3,745,808    3,745,808    3,381,296 
                  43,137,105    34,583,893 
Dukane IAS,LLC  Welding Equipment Manufacturer  Second Lien Note 10.5000% Cash, 2.5000% PIK, 11/17/2020 (b, k, n)  02/17/16   4,575,144    4,566,420    4,565,295 
FOLIOfn, Inc.  Technology Investment - Financial Services  Preferred Stock (5,802,259 shares) (d, i, n)  06/21/00        15,000,000    12,750,000 
Global Prairie PBC, Inc.  Marketing  Second Lien Loan 10.0000% Cash, 4.0000% PIK, 04/16/2025 (b, k, n)  10/16/19   3,087,161    3,035,793    3,076,527 
GTM Intermediate Holdings, Inc.  Medical Equipment/Manufacturer  Second Lien Loan 11.0000% Cash, 1.0000% PIK, 12/7/2024 (b ,k, n)  12/07/18   5,102,710    5,025,420    5,098,327 
      Common Stock (2 shares) (d, n, q)  12/07/18        766,122    1,187,245 
                  5,791,542    6,285,572 
Highpoint Global LLC  Government Services  Second Lien Note 12.0000% Cash, 2.0000% PIK, 09/30/2022 (b, k, n)  10/19/17   5,280,808    5,237,046    5,280,808 
HTI Technologies and Industries, Inc.  Electronic Component Manufacturing  Second Lien Note 16.7500% PIK, 9/15/2024 (b, k, n)  06/01/16   12,101,934    12,085,650    11,574,645 
Initials, Inc.  Consumer Products  Senior Subordinated Debt 8.0000% Cash, 7.0000% PIK, 10/1/2020 (b, h, k, n)  06/23/15   5,642,913    5,642,913    626,221 
International Precision Components Corporation  Plastic Injection Molding  Second Lien Loan 12.0000% Cash, 2.0000% PIK, 10/3/2024 (b, k, n, r)  06/27/12   7,700,000    7,581,258    7,700,000 
Jedson Engineering, Inc.  Engineering and Construction Management  First Lien Loan 12.0000% Cash, 3.0000% PIK, 06/30/2022 (b, k, n)  06/25/19   9,487,685    9,311,595    6,598,351 
Legal Solutions Holdings, Inc.  Business Services  Senior Subordinated Debt 6.0000% Cash, 10.0000% PIK, 03/31/2022 (b, h, k, n)  12/30/14   10,141,212    10,141,212    9,259,159 
Powers Equipment Acquisition Company, LLC  Equipment Manufacturer  First Lien Note 13.5000% PIK, 04/30/2024 (b, k, n, s)  05/01/19   6,724,345    6,626,953    5,524,748 
SMA Holdings, Inc.  Consulting  First Lien Loan 11.0000% Cash, 06/26/2024 (k, n)  06/26/19   7,000,000    6,519,104    7,000,000 
      Warrants (d, n)  06/26/19   2    504,555    792,120 
                  7,023,659    7,792,120 
Trientis GmbH  Environmental Services  First Lien Note 5.0000% PIK, 10/26/2024 (b, e, h, m, n, o)  10/20/17   1,248,632    1,248,632    221,379 
      Warrants (d, e, n, o)  03/19/18   1    67,715    - 
                  1,316,347    221,379 
Tuf-Tug Inc.  Safety Equipment Manufacturer  Second Lien Loan 11.0000% Cash, 2.0000% PIK,02/24/2024 (b, k, n)  08/24/18   5,061,687    5,030,101    5,052,984 
      Common Stock (24.6 shares) (d, n, p)  08/24/18        750,000    535,924 
                  5,780,101    5,588,908 
Turf Products, LLC  Distributor - Landscaping and Irrigation Equipment  Senior Subordinated Debt 10.0000% Cash, 10/07/2023 (k, n)  11/30/05   8,697,056    8,697,056    8,124,954 
U.S. Gas & Electric, Inc.  Energy Services  Second Lien Loan, 9.5000% Cash, 07/05/2025 (l, n)  07/05/17   2,285,250    2,285,250    2,285,250 
      Second Lien Loan, 9.5000% Cash, 07/05/2025 (h, l, n)  07/05/17   2,485,469    2,485,469    - 
                  4,770,719    2,285,250 
U.S. Spray Drying Holding Company  Specialty Chemicals  Class B Common Stock (784 shares) (d, n)  03/28/13        5,488,000    10,000 
      Secured Loan 8.0000% Cash, 04/30/2025 (k, n)  05/02/14   1,500,000    1,500,000    1,500,000 
      Senior Secured Loan 8.0000% Cash, 04/30/2025 (k, n)  11/08/17   1,500,000    1,500,000    1,500,000 
                  8,488,000    3,010,000 
United States Technologies, Inc.  Electronics Manufacturing and Repair  Senior Lien Loan 10.5000% Cash, 07/17/2021 (k, n)  07/17/15   3,666,667    3,666,667    3,666,667 
                         
Sub Total Non-control/Non-affiliated investments                $175,567,727   $146,947,497 
                         
Affiliate investments - 23.77% (a, c, f, g)                        
Advantage Insurance, Inc.  Insurance  Preferred Stock (587,001 shares) (a, d, e, n)  09/23/13        5,870,010    5,175,776 
JSC Tekers Holdings  Real Estate Management  Common Stock (3,201 shares) (a, d, e, n)  05/04/11        4,500    - 
      Preferred Stock (9,159,085 shares) (a, d, e, n)  05/01/14        11,810,188    5,019,000 
                  11,814,688    5,019,000 
Security Holdings B.V.  Electrical Engineering  Common Equity Interest (a, d, e, n)  09/03/08        51,204,270    18,844,000 
      Bridge Loan 5.0000% PIK, 05/31/2022 (a, b, e, k, n)  04/03/17   5,187,508    5,187,508    5,187,508 
      Senior Subordinated Loan 3.1000% PIK, 05/31/2022 (a, b, e, k, n)  05/30/18   8,677,707    8,677,707    8,677,707 
                  65,069,485    32,709,215 
                         
Sub Total Affiliate investments                $82,754,183   $42,903,991 

 

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

 

9

 

 

MVC Capital, Inc.

Consolidated Schedule of Investments - (Continued)

July 31, 2020

(Unaudited)

 

Company  Industry  Investment  Acquistion Date  Principal   Cost   Fair Value 
Control investments - 17.18% (a, c, f, g)                     
MVC Automotive Group GmbH  Automotive Dealerships  Common Equity Interest (d, e, n)  09/20/07       $52,185,015   $14,737,000 
      Bridge Loan 6.0000% Cash, 12/31/2021 (e, k, n)  06/28/16  $7,149,166    7,149,166    7,149,166 
                  59,334,181    21,886,166 
MVC Private Equity Fund LP  Private Equity  Limited Partnership Interest (d, j, k, n)  11/21/11        7,179,036    8,885,662 
      General Partnership Interest (d, j, k, n)  11/21/11        183,138    227,491 
                  7,362,174    9,113,153 
RuMe Inc.  Consumer Products  Common Stock (5,297,548 shares) (d, n)  07/15/11        924,475    - 
      Series C Preferred Stock (23,896,634 shares) (d, n)  05/07/14        3,410,694    - 
      Series B-1 Preferred Stock (4,999,076 shares) (d, n)  07/15/11        999,815    - 
      Subordinated Debt 10.0000% PIK, 3/31/2021 (b, h, k, n)  10/07/16   3,793,732    3,793,732    - 
      Revolver 10.0000% PIK, 3/31/2021 (b, h, k, n)  08/09/18   2,231,948    2,231,948    - 
      Revolver 10.0000% PIK, 3/31/2021 (b, h, k, n)  08/30/19   726,704    726,704    - 
      Warrants (d, n)  12/31/13   3    594,544    - 
                  12,681,912    - 
                         
Sub Total Control investments                $79,378,267   $30,999,319 
                         
TOTAL PORTFOLIO INVESTMENTS - 122.38% (f)                $337,700,177   $220,850,807 
                         
Cash equivalents- 27.82% (f, g)                        
Fidelity Institutional Government Money Market Fund - Class I  Money Market Fund  Beneficial Shares (50,100,415 shares)          $50,100,415   $50,100,415 
Morgan Stanley Institutional Liquidity Government Portfolio - Class I  Money Market Fund  Beneficial Shares (99,904 shares)           99,904    99,904 
Total Cash equivalents                 50,200,319    50,200,319 
                         
TOTAL INVESTMENT ASSETS - 150.20%                $387,900,496   $271,051,126 

 

(a) These securities are restricted from public sale without prior registration under the Securities Act of 1933.The Company negotiates certain aspects of the method and timing of the disposition of these investments, including registration rights and related costs.

 

(b) These securities accrue a portion of their interest/dividends in "payment in kind" interest/dividends which is capitalized to the investment.

 

(c) All of the Company's equity and debt investments are issued by eligible portfolio companies, as defined in the Investment Company Act of 1940, except MVC Automotive Group GmbH, Security Holdings B.V., Trientis GmbH, JSC Tekers Holdings, and MVC Private Equity Fund L.P.

 

The Company makes available significant managerial assistance to all of the portfolio companies in which it has invested.

 

(d) Non-income producing assets.

 

(e) The principal operations of these portfolio companies are located in Europe and Puerto Rico which represents approximately 23% of the total assets.The remaining portfolio companies are located in United States which represents approximately 55% of the total assets.

 

(f) Percentages are based on net assets of $180,465,804 as of July 31, 2020.

 

(g) See Note 3 for further information regarding “Investment Classification.”

 

(h) All or a portion of the accrued interest on these securities have been reserved for.

 

(i) Legacy Investments.

 

(j) MVC Private Equity Fund, LP is a private equity fund focused on control equity investments in the lower middle market.The fund currently holds two investments, one located in the United States and one in Gibraltar, the investments are in the energy services and industrial sectors.The Company owns 18.9% of the fund through its limited partnership interest and owns .5% of the fund through its general partnership interest.The Company's proportional share of Gibdock Limited equity interest and loan and Advanced Oil Field Services, LLC common stock, preferred stock, and loan is $6,704,992 and $2,064,571, respectively.The Company's partnership interests in the MVC Private Equity Fund, LP are not redeemable.

 

(k) All or a portion of these securities may serve as collateral for the People's United credit facility.

 

(l) U.S. Gas & Electric, Inc. is an indirect subsidiary of Vistra Energy (NYSE: VST). On October 18, 2019 and July 6, 2020, Vistra Energy notified the Company that it was asserting offsets of Company's loan assets totaling approximately $2.5 million relating to an indemnification claim obligations attributable to U.S. Gas.The offset is reflected in the fair value of the loan asset as the Company is considering its response to the claim.

 

(m) Cash/PIK toggle at borrower's option

 

(n) These securities are valued using unobservable inputs.

 

(o) During the fiscal year ended October 31, 2018, all assets and liabilities of SGDA Europe were transferred to a new Austrian holding company, Trientis GmbH, to achieve operating efficiencies.

 

(p) Shares of Tuf-Tug, Inc. are held via Alitus T-T, LP.

 

(q) Shares of GTM Intermediate Holdings, Inc. are held via GTM Ultimate Holdings, LLC.

 

(r) Variable PIK rate between 2.0000% and 3.5000%.

 

(s) Variable cash rate between 10.5000% and 13.5000%.

 

PIK - Payment-in-kind

 

- Denotes zero cost or fair value.

 

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

 

10

 

 

 

MVC Capital, Inc.

Consolidated Schedule of Investments

October 31, 2019

 

Company  Industry  Investment  Acquistion Date  Principal   Cost   Fair Value/
Market Value
 
Non-control/Non-affiliated investments- 100.60% (a, c, f, g)                     
Apex Industrial Technologies, LLC  Supply Chain Equipment Manufacturer   First Lien Loan 12.0000% Cash,  12/31/2019 (k, n)  03/09/18  $15,000,000   $14,899,274   $15,000,000 
Array Information Technology, Inc.  Information Technology Products and Services   Second Lien Loan 12.0000% Cash, 4.0000% PIK,  10/03/2023 (b, k, n, p)  04/03/18   6,259,648    6,175,991    6,322,216 
       Warrants (d, n)  04/03/18   1    -    - 
                  6,175,991    6,322,216 
Black Diamond Equipment Rentals, LLC  Equipment Rental   Second Lien Loan 12.5000% Cash,  06/27/2022 (k, n)  12/28/17   7,500,000    7,174,926    7,575,000 
       Warrants (d, n)  12/28/17   1    400,847    960,000 
                  7,575,773    8,535,000 
Custom Alloy Corporation  Manufacturer of Pipe Fittings and Forgings   Second Lien Loan 12.0000% Cash, 3.0000% PIK, 04/30/2022 (b, k, n)  10/31/14   32,471,814    32,471,814    32,061,135 
       Second Lien Loan 12.0000% Cash, 3.0000% PIK, 04/30/2022 (b, k, n)  10/31/14   6,128,186    6,128,186    6,050,681 
       Revolver 12.0000% Cash, 3.0000% PIK, 04/30/2020 (b, k, n)  07/01/19   2,050,000    2,050,000    2,050,000 
                  40,650,000    40,161,816 
Dukane IAS,LLC  Welding Equipment Manufacturer   Second Lien Note 10.5000% Cash, 2.5000% PIK, 11/17/2020 (b, k, n)  02/17/16   4,489,182    4,458,353    4,534,074 
Essner Manufacturing, LP  Defense/Aerospace Parts Manufacturing   First Lien Loan 11.5000% Cash, 12/20/2022 (k, n, o)  12/20/17   3,588,606    3,543,739    3,588,606 
FOLIOfn, Inc.  Technology Investment - Financial Services   Preferred Stock (5,802,259 shares) (d, i, n)  06/21/00        15,000,000    6,352,000 
 Global Prairie PBC, Inc.  Marketing   Second Lien Loan 10.0000% Cash, 4.0000% PIK, 04/16/2025 (b, k, n)  10/16/19   3,000,000    2,940,448    3,000,000 
GTM Intermediate Holdings, Inc.  Medical Equipment/Manufacturer   Second Lien Loan 11.0000% Cash, 1.0000% PIK, 12/7/2024 (b ,k, n)  12/07/18   5,064,069    4,973,443    5,064,069 
       Common Stock (2 shares) (d, n, t)  12/07/18        766,122    766,122 
                  5,739,565    5,830,191 
Highpoint Global LLC  Government Services  Second Lien Note 12.0000% Cash, 2.0000% PIK, 09/30/2022 (b, k, n)  10/19/17   5,201,232    5,142,323    5,201,232 
HTI Technologies and Industries, Inc.  Electronic Component Manufacturing  Second Lien Note 12.0000% Cash, 3.7500% PIK, 9/15/2024 (b, k, n)  06/01/16   11,419,845    11,400,660    11,419,845 
Initials, Inc.  Consumer Products  Senior Subordinated Debt 8.0000% Cash, 7.0000% PIK, 06/23/2020 (b, h, k, n)  06/23/15   5,642,913    5,642,913    1,272,188 
International Precision Components Corporation  Plastic Injection Molding  Second Lien Loan 12.0000% Cash, 3.5000% PIK, 10/3/2024 (b, k, n, u)  06/27/12   8,000,000    7,854,192    8,000,000 
Jedson Engineering, Inc.  Engineering and Construction Management  First Lien Loan 12.0000% Cash, 3.0000% PIK, 06/21/2024 (b, k, n)  06/25/19   6,041,262    5,928,722    6,041,262 
Legal Solutions Holdings, Inc.  Business Services  Senior Subordinated Debt 12.0000% Cash, 3.0000% PIK, 03/18/2020 (b, k, n)  12/30/14   12,182,950    12,182,950    12,182,950 
Morey's Seafood International, LLC  Food Services  Second Lien Loan 10.0000% Cash, 3.0000% PIK, 08/12/2022 (b, k, n, q)  08/13/13   16,485,324    16,485,324    16,485,324 
Powers Equipment Acquisition Company, LLC  Equipment Manufacturer  First Lien Note 13.5000% Cash, 04/30/2024 (k, n, v)  05/01/19   6,500,000    6,383,100    6,500,000 
SMA Holdings, Inc.  Consulting  First Lien Loan 11.0000% Cash, 06/26/2024 (k, n)  06/26/19   7,000,000    6,426,640    6,530,794 
      Warrants (d, n)  06/26/19   2    504,555    504,555 
                 6,931,195    7,035,349 
Trientis GmbH  Environmental Services  First Lien Note 5.0000% PIK, 10/26/2024 (b, e, h, m, n, r)  10/20/17   1,248,632    1,248,632    176,906 
       Warrants (d, e, r, n)  03/19/18   1    67,715    - 
                  1,316,347    176,906 
Tuf-Tug Inc.  Safety Equipment Manufacturer  Second Lien Loan 11.0000% Cash, 2.0000% PIK,  02/24/2024 (b, k, n)  08/24/18   4,985,284    4,947,047    5,035,136 
      Common Stock (24.6 shares) (d, n, s)  08/24/18        750,000    778,210 
                5,697,047    5,813,346 
Turf Products, LLC  Distributor - Landscaping and Irrigation Equipment  Senior Subordinated Debt 10.0000% Cash, 08/07/2020 (k, n)  11/30/05   7,717,056    7,717,056    7,563,104 
     Third Lien Loan 10.0000% Cash,  08/07/2020 (k, n)  12/22/17   1,050,000    1,050,000    1,032,473 
                  8,767,056    8,595,577 
U.S. Gas & Electric, Inc.  Energy Services  Second Lien Loan, 9.5000% Cash, 07/05/2025 (l, n)  07/05/17   37,527,881    37,527,881    36,974,616 
U.S. Spray Drying Holding Company  Specialty Chemicals  Class B Common Stock (784 shares) (d, n)  03/28/13        5,488,000    1,800,000 
      Secured Loan 12.0000% Cash, 04/30/2021 (k, n)  05/02/14   1,500,000    1,500,000    1,500,000 
      Senior Secured Loan 12.0000% Cash, 04/30/2021 (k, n)  11/08/17   1,500,000    1,500,000    1,500,000 
                  8,488,000    4,800,000 
United States Technologies, Inc.  Electronics Manufacturing and Repair  Senior Lien Loan 10.5000% Cash, 07/17/2020 (k, n)  07/17/15   5,500,000    5,497,954    5,500,000 
                         
Sub Total Non-control/Non-affiliated investments                $246,228,807   $229,322,498 
                         
Affiliate investments - 27.13% (a, c, f, g)                        
Advantage Insurance, Inc.  Insurance  Preferred Stock (750,000 shares) (d, e, n)  09/23/13        7,500,000    7,513,627 
Equus Total Return, Inc.  Registered Investment Company  Common Stock (3,228,024 shares) (d, k)  05/14/14        7,524,035    4,874,316 
JSC Tekers Holdings  Real Estate Management  Common Stock (3,201 shares) (d, e, n)  05/04/11        4,500    - 
      Preferred Stock (9,159,085 shares) (d, e, n)  05/01/14        11,810,188    4,910,000 
                  11,814,688    4,910,000 
Security Holdings B.V.  Electrical Engineering  Common Equity Interest (d, e, n)  09/03/08        51,204,270    33,607,000 
      Bridge Loan 5.0000% PIK, 12/31/2019 (b, e, k, n)  04/03/17   4,937,218    4,937,218    4,937,218 
      Senior Subordinated Loan 3.1000% PIK, 05/31/2020 (b, e, k, n)  05/30/18   6,009,735    6,009,735    6,009,735 
                  62,151,223    44,553,953 
                         
Sub Total Affiliate investments                $88,989,946   $61,851,896 

 

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

 

11

 

 

MVC Capital, Inc.

Consolidated Schedule of Investments - (Continued)

October 31, 2019

 

Company  Industry  Investment  Acquistion Date  Principal   Cost   Fair Value/
Market Value
 
Control investments - 21.53% (c, f, g)                        
MVC Automotive Group GmbH  Automotive Dealerships  Common Equity Interest (a, d, e, n)  09/20/07       $52,185,015   $20,602,000 
      Bridge Loan 6.0000% Cash, 12/31/2020 (a, e, k, n)  06/28/16  $7,149,166    7,149,166    7,149,166 
                  59,334,181    27,751,166 
MVC Private Equity Fund LP  Private Equity  Limited Partnership Interest (a, d, j, k, n)  11/21/11        9,034,881    12,252,382 
      General Partnership Interest (a, d, j, k, n)  11/21/11        230,481    312,561 
                 9,265,362    12,564,943 
RuMe Inc.  Consumer Products  Common Stock (5,297,548 shares) (a, d, n)  07/15/11        924,475    - 
      Series C Preferred Stock (23,896,634 shares) (a, d, n)  05/07/14        3,410,694    1,462,857 
      Series B-1 Preferred Stock (4,999,076 shares) (a, d, n)  07/15/11        999,815    - 
      Subordinated Debt 10.0000% PIK, 3/31/2020 (a, b, k, n)  10/07/16   3,610,446    3,610,446    3,610,446 
      Revolver 10.0000% PIK, 3/31/2021 (a, b, k, n)  08/09/18   2,075,613    2,075,613    2,075,613 
      Revolver 10.0000%