10-Q

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

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

For the quarterly period ended September 30, 2021

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

For the transition period from to

Commission File No. 814-00735

Portman Ridge Finance Corporation

(Exact name of Registrant as specified in its charter)

 

 

Delaware

 

20-5951150

(State or other jurisdiction of

Incorporation or organization)

 

(I.R.S. Employer

Identification Number)

650 Madison Avenue, 23rd Floor

New York, New York 10022

(Address of principal executive offices)

(212) 891-2880

(Registrant's telephone number, including area code)

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, par value $0.01 per share

 

PTMN

 

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 No

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

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

 

Large accelerated filer

 

Accelerated filer

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 7(a)(2)(B) of the Securities Act.

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

 

The number of outstanding shares of common stock of the registrant as of November 3, 2021 was 9,123,275.

 

 


 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

 

Part I. Financial Information

 

 

 

 

Item 1.

Consolidated Financial Statements

 

 

 

 

 

Consolidated Balance Sheets as of September 30, 2021 (unaudited) and December 31, 2020

5

 

 

 

 

Consolidated Statements of Operations (unaudited) for the three and nine months ended September 30, 2021 and 2020

6

 

 

 

 

Consolidated Statements of Changes in Net Assets (unaudited) for the nine months ended September 30, 2021 and 2020

7

 

 

 

 

Consolidated Statements of Cash Flows (unaudited) nine months ended September 30, 2021 and 2020

8

 

 

 

 

Consolidated Schedules of Investments (unaudited) as of September 30, 2021 and December 31, 2020

9

 

 

 

 

Consolidated Financial Highlights (unaudited) for the nine months ended September 30, 2021 and 2020

38

 

 

 

 

Notes to Consolidated Financial Statements (unaudited)

39

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

80

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

105

 

 

 

Item 4.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

106

 

 

 

Item 5.

Controls and Procedures

106

 

 

 

 

Part II. Other Information

 

 

 

 

Item 1.

Legal Proceedings

107

 

 

 

Item 1A.

Risk Factors

107

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

111

 

 

 

Item 3.

Defaults Upon Senior Securities

111

 

 

 

Item 4.

Mine Safety Disclosures

111

 

 

 

Item 5.

Other Information

112

 

 

 

Item 6.

Exhibits

112

 

 

 

Signatures

 

114

 

2


 

NOTE ABOUT REFERENCES TO PORTMAN RIDGE FINANCE CORPORATION

In this Quarterly Report on Form 10-Q, the “Company”, “Portman Ridge”, “we”, “us” and “our” refer to Portman Ridge Finance Corporation and its wholly-owned subsidiaries, Garrison Funding 2018-2 Ltd. (“GF CLO 2018-2”), Great Lakes KCAP Funding I LLC, Great Lakes Portman Ridge Funding, LLC, OHA Investment Sub, LLC, OHA Asset Holdings II, LP, Kohlberg Capital Funding I LLC, KCAP Senior Funding I, LLC KCAP Senior Funding I Holdings, LLC, Harvest Equity Holdings, LLC and HCAP ICC, LLC unless the context otherwise requires.

NOTE ABOUT FORWARD-LOOKING STATEMENTS

The information contained in this item should be read in conjunction with our consolidated financial statements and notes thereto appearing elsewhere in this Quarterly Report and in conjunction with the financial statements and notes thereto in the Company’s Form 10-K for the year ended December 31, 2020, as filed with the U.S. Securities and Exchange Commission (the “Commission” or the “SEC”). In addition, some of the statements in this report constitute forward-looking statements. The matters discussed in this Quarterly Report, as well as in future oral and written statements by management of Portman Ridge Finance Corporation, that are forward-looking statements are based on current management expectations that involve substantial risks and uncertainties which could cause actual results to differ materially from the results expressed in, or implied by, these forward-looking statements. Forward-looking statements relate to future events or our future financial performance. We generally identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “outlook, ”believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar words. Important assumptions include our ability to originate new investments, achieve certain margins and levels of profitability, the availability of additional capital, and the ability to maintain certain debt to asset ratios. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this Quarterly Report should not be regarded as a representation by us that our plans or objectives will be achieved. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including without limitation:

our future operating results;
our business prospects and the prospects of our existing and prospective portfolio companies;
the return or impact of current and future investments;
our contractual arrangements and other relationships with third parties;
the dependence of our future success on the general economy and its impact on the industries in which we invest;
the financial condition and ability of our existing and prospective portfolio companies to achieve their objectives;
our expected financings and investments;
our ability to operate as a business development company (“BDC”) under the Investment Company Act of 1940 and a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, including the impact of changes in laws or regulations governing our operations or the operations of our portfolio companies;
the adequacy of our available liquidity, cash resources and working capital;
the timing of cash flows, if any, from the operations of our portfolio companies;
the ability of Sierra Crest Investment Management LLC (the “Adviser”) to locate suitable investments for us to monitor and administer our investments;
the ability of the Adviser to attract and retain highly talented professionals;
actual and potential conflicts of interest with the Adviser and its affiliates;
the effect of legal, tax, and regulatory changes on us and our portfolio companies;
the impact of a protracted decline in the liquidity of credit markets on our business;
the impact of fluctuations in interest rates on our business;

3


 

the valuation of our investments in portfolio companies, particularly those having no liquid trading market;
our ability to recover unrealized losses;
market conditions and our ability to access additional capital;
the continued duration and effects of the COVID-19 pandemic on us and our portfolio companies;
an economic downturn, including as a result of the impact of the COVID-19 pandemic, could have a material adverse effect on our portfolio companies’ results of operations and financial condition, which could lead to a loss on some or all of our investments in such portfolio companies and have a material adverse effect on our results of operations and financial condition; and
the timing, form and amount of any dividend distributions.

For a more detailed discussion of factors that could cause our actual results to differ from forward-looking statements contained in this Quarterly Report, please see the discussion in Part II, “Item 1A. Risk Factors” of this Quarterly Report, and in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. You should not place undue reliance on these forward-looking statements. The forward-looking statements made in this Quarterly Report relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statement to reflect events or circumstances occurring after the date this Quarterly Report is filed with the SEC.

4


 

PORTMAN RIDGE FINANCE CORPORATION

CONSOLIDATED BALANCE SHEETS

 

 

 

September 30, 2021

 

 

December 31,
2020

 

 

 

(Unaudited)

 

 

 

 

ASSETS

 

 

 

 

 

 

Investments at fair value:

 

 

 

 

 

 

Debt securities (amortized cost: 2021 - $450,601,744; 2020 - $392,932,411)

 

$

455,079,876

 

 

$

404,860,855

 

CLO Fund Securities managed by non-affiliates (amortized cost: 2021 - $33,964,238; 2020 - $45,727,813)

 

 

17,173,634

 

 

 

19,582,555

 

Equity securities (cost: 2021 - $29,041,687; 2020 - $24,593,639)

 

 

22,298,759

 

 

 

13,944,876

 

Asset Manager Affiliates (cost: 2021 - $17,791,230; 2020 - $17,791,230)

 

 

 

 

 

 

Joint Ventures (cost: 2021 - $70,558,377; 2020 - $54,932,458)

 

 

67,629,114

 

 

 

49,349,163

 

Total Investments at Fair Value, excluding derivatives (cost: 2021 - $601,957,277; 2020 - $535,977,551)

 

 

562,181,383

 

 

 

487,737,449

 

Cash and cash equivalents

 

 

28,539,989

 

 

 

6,990,008

 

Restricted cash

 

 

21,050,857

 

 

 

75,913,411

 

Interest receivable

 

 

4,228,748

 

 

 

2,972,546

 

Receivable for unsettled trades

 

 

7,070,394

 

 

 

25,107,598

 

Due from affiliates

 

 

464,342

 

 

 

357,168

 

Other assets

 

 

3,568,698

 

 

 

1,100,241

 

Total Assets

 

$

627,104,411

 

 

$

600,178,421

 

LIABILITIES

 

 

 

 

 

 

6.125% Notes Due 2022 (net of offering costs of: 2020 - $1,058,351)

 

$

-

 

 

$

75,667,624

 

2018-2 Secured Notes (net of discount of: 2021 - $1,446,983; 2020 - $2,444,512)

 

 

162,415,715

 

 

 

249,418,186

 

4.875% Notes Due 2026 (net of discount of: 2021 - $2,266,656; 2020 - $0, net of offering costs of: 2021 - $948,071; 2020 - $0)

 

 

104,785,273

 

 

 

 

Great Lakes Portman Ridge Funding LLC Revolving Credit Facility (net of offering costs of: 2021 - $823,375; 2020 - $1,097,815)

 

 

68,247,523

 

 

 

48,223,083

 

Derivative liabilities (cost: 2021 - $30,609; 2020 - $30,609)

 

 

1,982,091

 

 

 

1,108,618

 

Payable for unsettled trades

 

 

4,903,384

 

 

 

 

Accounts payable, accrued expenses and other liabilities

 

 

3,961,666

 

 

 

1,788,908

 

Accrued interest payable

 

 

3,345,558

 

 

 

1,089,531

 

Due to affiliates

 

 

760,112

 

 

 

1,374,739

 

Management and incentive fees payable

 

 

5,654,814

 

 

 

5,243,869

 

Total Liabilities

 

 

356,056,136

 

 

 

383,914,558

 

COMMITMENTS AND CONTINGENCIES (NOTE 8)

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Common stock, par value $0.01 per share, 20,000,000 common shares authorized; 9,291,578 issued, and 9,123,275 outstanding at September 30, 2021, and 7,609,349 issued, and 7,516,423 outstanding at December 31,
2020

 

 

91,233

 

 

 

75,164

 

Capital in excess of par value

 

 

680,451,474

 

 

 

639,136,026

 

Total distributable (loss) earnings

 

 

(409,494,432

)

 

 

(422,947,327

)

Total Stockholders' Equity

 

 

271,048,275

 

 

 

216,263,863

 

Total Liabilities and Stockholders' Equity

 

$

627,104,411

 

 

$

600,178,421

 

NET ASSET VALUE PER COMMON SHARE (1)

 

$

29.71

 

 

$

28.77

 

(1) The Company completed a Reverse Stock Split of 10 to 1 effective August 26, 2021, the common shares and net asset value per common share have been adjusted retroactively to reflect the split for all periods presented.

 

See accompanying notes to unaudited consolidated financial statements.

5


 

PORTMAN RIDGE FINANCE CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

 

 

 

For the Three Months Ended September 30,

 

 

For the Nine Months Ended September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Investment income:

 

 

 

 

 

 

 

 

 

 

 

 

Interest from investments in debt securities

 

$

17,391,146

 

 

$

4,517,268

 

 

$

48,736,532

 

 

$

13,910,567

 

Payment-in-kind investment income

 

 

1,296,496

 

 

 

434,446

 

 

 

3,172,910

 

 

 

1,125,343

 

Interest from cash and time deposits

 

 

-

 

 

 

-

 

 

 

-

 

 

 

15,279

 

Investment income on CLO Fund Securities managed by affiliates

 

 

-

 

 

 

587,239

 

 

 

-

 

 

 

2,493,600

 

Investment income on CLO Fund Securities managed by non-affiliates

 

 

748,449

 

 

 

42,341

 

 

 

2,211,092

 

 

 

247,302

 

Investment income - Joint Ventures

 

 

2,442,703

 

 

 

2,182,466

 

 

 

7,012,167

 

 

 

4,760,485

 

Capital structuring service fees

 

 

1,032,346

 

 

 

23,602

 

 

 

1,628,155

 

 

 

302,887

 

Total investment income

 

 

22,911,140

 

 

 

7,787,362

 

 

 

62,760,856

 

 

 

22,855,463

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Management fees

 

 

2,064,733

 

 

 

1,043,645

 

 

 

5,771,636

 

 

 

3,063,719

 

Performance-based incentive fees

 

 

1,939,170

 

 

 

571,846

 

 

 

6,332,646

 

 

 

1,128,726

 

Interest and amortization of debt issuance costs

 

 

3,408,445

 

 

 

2,239,911

 

 

 

10,315,528

 

 

 

6,984,852

 

Professional fees

 

 

490,284

 

 

 

439,503

 

 

 

2,680,458

 

 

 

1,810,450

 

Insurance

 

 

198,011

 

 

 

177,154

 

 

 

574,973

 

 

 

478,058

 

Administrative services expense

 

 

760,112

 

 

 

470,435

 

 

 

2,091,769

 

 

 

1,361,700

 

Other general and administrative expenses

 

 

332,534

 

 

 

147,818

 

 

 

1,352,737

 

 

 

522,091

 

Total expenses

 

 

9,193,289

 

 

 

5,090,312

 

 

 

29,119,747

 

 

 

15,349,596

 

Management and performance-based incentive fees waived

 

 

 

 

 

 

 

 

 

 

 

(556,880

)

Net Expenses

 

 

9,193,289

 

 

 

5,090,312

 

 

 

29,119,747

 

 

 

14,792,716

 

Net Investment Income

 

 

13,717,851

 

 

 

2,697,050

 

 

 

33,641,109

 

 

 

8,062,747

 

Realized And Unrealized Gains (Losses) On Investments:

 

 

 

 

 

 

 

 

 

 

 

 

Net realized (losses) gains from investment transactions

 

 

(3,931,280

)

 

 

(1,890,090

)

 

 

(11,372,803

)

 

 

(3,819,851

)

Net change in unrealized appreciation (depreciation) on:

 

 

 

 

 

 

 

 

 

 

 

 

Debt securities

 

 

(4,447,878

)

 

 

4,553,027

 

 

 

(7,448,405

)

 

 

(3,945,277

)

Equity securities

 

 

1,215,013

 

 

 

337,258

 

 

 

3,905,834

 

 

 

411,276

 

CLO Fund Securities managed by affiliates

 

 

 

 

 

1,573,272

 

 

 

 

 

 

(12,168,189

)

CLO Fund Securities managed by non-affiliates

 

 

706,935

 

 

 

363,430

 

 

 

9,354,655

 

 

 

(491,863

)

Joint Venture Investments

 

 

2,063,261

 

 

 

1,146,355

 

 

 

2,654,032

 

 

 

(4,654,363

)

Derivatives

 

 

(179,416

)

 

 

(461,629

)

 

 

(873,473

)

 

 

(999,612

)

Total net change in unrealized appreciation (depreciation)

 

 

(642,085

)

 

 

7,511,713

 

 

 

7,592,643

 

 

 

(21,848,028

)

Net realized and unrealized appreciation (depreciation) on investments

 

 

(4,573,365

)

 

 

5,621,623

 

 

 

(3,780,160

)

 

 

(25,667,879

)

Realized (losses) gains on extinguishments of Debt

 

 

 

 

 

 

 

 

(1,834,963

)

 

 

154,571

 

Net Increase (Decrease) In Stockholders’ Equity Resulting From Operations

 

$

9,144,486

 

 

$

8,318,673

 

 

$

28,025,986

 

 

$

(17,450,561

)

Net Increase (Decrease) In Stockholders' Equity Resulting from Operations per Common Share (1):

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

$

1.00

 

 

$

1.87

 

 

$

3.41

 

 

$

(3.91

)

Diluted:

 

$

1.00

 

 

$

1.87

 

 

$

3.41

 

 

$

(3.91

)

Net Investment Income Per Common Share (1):

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

$

1.50

 

 

$

0.61

 

 

$

4.10

 

 

$

1.81

 

Diluted:

 

$

1.50

 

 

$

0.61

 

 

$

4.10

 

 

$

1.81

 

Weighted Average Shares of Common Stock Outstanding—Basic (1)

 

 

9,131,456

 

 

 

4,441,778

 

 

 

8,213,661

 

 

 

4,461,650

 

Weighted Average Shares of Common Stock Outstanding—Diluted (1)

 

 

9,131,456

 

 

 

4,441,778

 

 

 

8,213,661

 

 

 

4,461,650

 

(1) The Company completed a Reverse Stock Split of 10 to 1 effective August 26, 2021, the weighted average shares outstanding and per share values have been adjusted retroactively to reflect the split for all periods presented.

 

See accompanying notes to unaudited consolidated financial statements.

6


 

PORTMAN RIDGE FINANCE CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS(1)

(unaudited)

 

 

For the Nine Months Ended September 30,

 

 

 

2021

 

 

2020

 

Operations:

 

 

 

 

 

 

Net investment income

 

$

33,641,109

 

 

$

8,062,747

 

Net realized gains (losses) from investment transactions

 

 

(11,372,803

)

 

 

(3,819,851

)

Realized (losses) gains from extinguishments of debt

 

 

(1,834,963

)

 

 

154,571

 

Net change in unrealized (depreciation) appreciation on investments

 

 

7,592,643

 

 

 

(21,848,028

)

Net increase (decrease) in stockholders’ equity resulting from operations

 

 

28,025,986

 

 

 

(17,450,561

)

 

 

 

 

 

 

 

Stockholder distributions:

 

 

(14,573,092

)

 

 

(8,043,278

)

 

 

 

 

 

 

 

Capital share transactions:

 

 

 

 

 

 

Issuance of common stock for:

 

 

 

 

 

 

Dividend reinvestment plan

 

 

443,778

 

 

 

104,238

 

Stock repurchases

 

 

(1,826,545

)

 

 

(862,871

)

Private placement

 

 

4,019,598

 

 

 

 

HCAP purchase (net of offering expenses)

 

 

38,694,688

 

 

 

 

Net increase in net assets resulting from capital share transactions

 

 

41,331,519

 

 

 

(758,633

)

 

 

 

 

 

 

 

Net assets at beginning of period

 

 

216,263,863

 

 

 

152,198,570

 

Net assets at end of period

 

$

271,048,276

 

 

$

125,946,098

 

Net asset value per common share (2)

 

$

29.71

 

 

$

28.51

 

Common shares outstanding at end of period (2)

 

 

9,123,275

 

 

 

4,416,906

 

 

 

(1) Refer to note 9 "Stockholders' Equity" for additional information on changes in components of Stockholders' Equity

(2) The Company completed a Reverse Stock Split of 10 to 1 effective August 26, 2021, the common shares and net asset value per common share have been adjusted retroactively to reflect the split for all periods presented.

 

See accompanying notes to unaudited consolidated financial statements.

7


 

PORTMAN RIDGE FINANCE CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

 

 

For the Nine Months Ended September 30,

 

 

 

2021

 

 

2020

 

OPERATING ACTIVITIES:

 

 

 

 

 

 

Net increase (decrease) in stockholders' equity resulting from operations

 

$

28,025,986

 

 

$

(17,450,561

)

Adjustments to reconcile net increase (decrease) in stockholders' equity resulting from operations to net cash (used in) provided by in operations:

 

 

 

 

 

 

Net realized (gains) losses on investment transactions

 

 

11,372,803

 

 

 

3,819,851

 

Net change in unrealized (depreciation) appreciation from investments

 

 

(7,592,643

)

 

 

21,848,028

 

Purchases of investments

 

 

(215,215,715

)

 

 

(107,085,081

)

Proceeds from sales and redemptions of investments

 

 

219,759,649

 

 

 

75,298,827

 

Net accretion of investments

 

 

(25,672,805

)

 

 

(4,683,861

)

Amortization of debt issuance costs

 

 

728,593

 

 

 

705,256

 

Realized gains on extinguishments of debt

 

 

1,834,963

 

 

 

(154,571

)

Net payment-in-kind interest income

 

 

(2,430,410

)

 

 

(380,093

)

Cash consideration net of cash acquired from mergers

 

 

13,581,062

 

 

 

 

(Increase) decrease in operating assets:

 

 

 

 

 

 

Receivable for unsettled trades

 

 

18,037,204

 

 

 

22,572,899

 

Interest and dividends receivable

 

 

(1,256,202

)

 

 

(559,702

)

Due from affiliates

 

 

(107,174

)

 

 

285,756

 

Other assets

 

 

(2,416,671

)

 

 

(396,544

)

Increase (decrease) in operating liabilities:

 

 

 

 

 

 

Payable for unsettled trades

 

 

4,903,384

 

 

 

 

Accrued interest payable

 

 

2,256,027

 

 

 

615,784

 

Management and incentive fees payable

 

 

410,945

 

 

 

538,512

 

Due to affiliates

 

 

(614,627

)

 

 

(115,533

)

Accounts payable and accrued expenses

 

 

2,172,758

 

 

 

187,857

 

Net cash used in operating activities

 

 

47,777,127

 

 

 

(4,953,176

)

FINANCING ACTIVITIES:

 

 

 

 

 

 

Debt issuance costs

 

 

(997,464

)

 

 

(1,342

)

Private placement

 

 

4,019,598

 

 

 

 

Stock repurchase program

 

 

(1,826,545

)

 

 

(862,871

)

Distributions to stockholders

 

 

(14,129,314

)

 

 

(7,939,040

)

Repurchase of 6.125% Notes Due 2022

 

 

(76,725,975

)

 

 

(513,383

)

Repayment of 2018-2 Secured Notes

 

 

(88,000,000

)

 

 

 

Repayment of 6.125% Notes from HCAP acquisition

 

 

(28,750,000

)

 

 

 

Issuance of 4.875% Notes Due 2026

 

 

105,570,000

 

 

 

 

Borrowings from Revolving Credit Facilities

 

 

19,750,000

 

 

 

47,250,000

 

Repayment of Revolving Credit Facilities

 

 

 

 

 

(32,500,000

)

Net cash provided by financing activities

 

 

(81,089,700

)

 

 

5,433,364

 

CHANGE IN CASH AND RESTRICTED CASH

 

 

(33,312,573

)

 

 

480,189

 

CASH AND RESTRICTED CASH, BEGINNING OF PERIOD

 

 

82,903,419

 

 

 

5,104,355

 

CASH AND RESTRICTED CASH, END OF PERIOD

 

$

49,590,846

 

 

$

5,584,544

 

Amounts per balance sheet:

 

 

 

 

 

 

Cash and cash equivalents

 

$

28,539,989

 

 

$

677,438

 

Restricted cash

 

 

21,050,857

 

 

 

4,907,105

 

Total Cash and Restricted cash

 

$

49,590,846

 

 

$

5,584,543

 

Supplemental Information:

 

 

 

 

 

 

Interest paid during the period

 

$

7,330,908

 

 

$

5,663,812

 

Dividends paid during the period under the dividend reinvestment plan

 

$

443,778

 

 

$

104,238

 

Supplemental non-cash information:

 

 

 

 

 

 

Acquisitions:

 

 

 

 

 

 

Non-cash assets acquired

 

 

 

 

 

 

Investments, at cost

 

$

53,811,838

 

 

$

 

Interest receivable

 

 

431,454

 

 

 

-

 

Other assets

 

 

2,664,932

 

 

 

-

 

Total non-cash assets purchased

 

$

56,908,224

 

 

$

 

Liabilities assumed

 

 

 

 

 

 

Debt

 

$

28,750,000

 

 

$

 

Accounts payable and accrued expenses

 

 

1,644,600

 

 

 

-

 

Total liabilities assumed

 

$

30,394,600

 

 

$

 

Issuance of common stock

 

 

37,063,461

 

 

$

 

Deemed capital contribution from affiliates

 

$

2,150,000

 

 

$

 

Transaction costs

 

 

881,226

 

 

$

 

See accompanying notes to unaudited consolidated financial statements.

8


 

PORTMAN RIDGE FINANCE CORPORATION

CONSOLIDATED SCHEDULE OF INVESTMENTS

As of September 30, 2021

(unaudited)

Debt Securities Portfolio

Portfolio Company /
Principal Business

 

Investment
Interest Rate¹ / Maturity
15

 

Initial
Acquisition
Date

 

Principal

 

 

Amortized
Cost

 

 

Fair Value2

 

1A Smart Start LLC
     Consumer goods: Non-durable

(8)(14)

Senior Secured Loan — First Lien Term Loan
5.8% Cash, 6 Month Libor (1.00%) + 4.75%; Libor Floor 1.00%, Due 8/27

 

10/28/2020

 

$

2,079,053

 

 

$

1,852,203

 

 

$

2,085,974

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accordion Partners LLC
     Finance

(8)(13)(14)(23)

Senior Secured Loan — Delayed Draw Term Loan
1.0% Cash, Due 9/27

 

9/24/2021

 

 

-

 

 

 

(21,000

)

 

 

(21,000

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accordion Partners LLC
     Finance

(8)(13)(23)

Senior Secured Loan — Revolver
0.5% Cash, Due 9/27

 

9/24/2021

 

 

-

 

 

 

(75,000

)

 

 

(75,000

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accordion Partners LLC
     Finance

(8)(13)(14)

Senior Secured Loan — Term Loan
6.5% Cash, 3 Month Libor (1.00%) + 5.50%; Libor Floor 1.00%, Due 9/27

 

9/24/2021

 

 

11,200,000

 

 

 

11,032,537

 

 

 

11,032,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advantage Capital Holdings LLC
     Banking, Finance, Insurance & Real Estate

(8)(13)(14)(21)

Senior Secured Loan — Delayed Draw Term Loan
5.0% Cash, 8.0% PIK, Due 1/25

 

2/14/2020

 

 

2,968,560

 

 

 

2,968,560

 

 

 

2,968,560

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advantage Capital Holdings LLC
     Banking, Finance, Insurance & Real Estate

(8)(13)(14)(21)

Senior Secured Loan — Term Loan
5.0% Cash, 8.0% PIK, Due 1/25

 

2/14/2020

 

 

2,622,599

 

 

 

2,622,599

 

 

 

2,622,599

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AIS Holdco, LLC
     Banking, Finance, Insurance & Real Estate

(8)(13)(14)

Senior Secured Loan — First Lien Term Loan A
5.1% Cash, 3 Month Libor (0.13%) + 5.00%, Due 8/25

 

10/28/2020

 

 

2,511,300

 

 

 

2,094,296

 

 

 

2,446,760

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AMCP Pet Holdings, Inc.
     Beverage, Food and Tobacco

(8)(13)(14)(21)(23)

Senior Secured Loan — Delayed Draw Term Loan
1.0% Cash, Due 10/26

 

12/9/2020

 

 

-

 

 

 

(17,275

)

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AMCP Pet Holdings, Inc.
     Beverage, Food and Tobacco

(8)(13)(21)(23)

Senior Secured Loan — Revolving Loan
7.3% Cash, 3 Month Libor (1.00%) + 6.25%; Libor Floor 1.00%, Due 10/26

 

12/9/2020

 

 

475,000

 

 

 

457,619

 

 

 

475,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AMCP Pet Holdings, Inc.
     Beverage, Food and Tobacco

(8)(13)(14)(21)

Senior Secured Loan — First Lien Term Loan
7.3% Cash, 6 Month Libor (1.00%) + 6.25%; Libor Floor 1.00%, Due 10/26

 

12/9/2020

 

 

4,962,500

 

 

 

4,876,779

 

 

 

4,962,500

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Analogic Corporation
     Electronics

(8)(13)(14)(23)

Senior Secured Loan — Revolver
0.5% Cash, Due 6/23

 

10/28/2020

 

 

-

 

 

 

-

 

 

 

(7,098

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Analogic Corporation
     Electronics

(8)(13)(14)

Senior Secured Loan — First Lien Term Loan A
6.3% Cash, 1 Month Libor (1.00%) + 5.25%; Libor Floor 1.00%, Due 6/24

 

10/28/2020

 

 

3,528,873

 

 

 

3,176,599

 

 

 

3,405,009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ancile Solutions, Inc.
     High Tech Industries

(8)(13)(14)

Senior Secured Loan — First Lien Term Loan
8.0% Cash, 3.0% PIK, 3 Month Libor (1.00%) + 7.00%; Libor Floor 1.00%, Due 6/26

 

6/11/2021

 

 

7,011,083

 

 

 

6,815,187

 

 

 

6,835,806

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Anthem Sports & Entertainment Inc.
     Media: Broadcasting & Subscription

(8)(13)(14)

Senior Secured Loan — Term Loan
10.5% Cash, 3 Month Libor (1.00%) + 9.50%; Libor Floor 1.00%, Due 9/24

 

3/31/2021

 

 

812,912

 

 

 

724,261

 

 

 

786,737

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Anthem Sports & Entertainment Inc.
     Media: Broadcasting & Subscription

(8)(13)(21)(23)

Senior Secured Loan — Revolving Loan
10.5% Cash, 3 Month Libor (1.00%) + 9.50%; Libor Floor 1.00%, Due 9/24

 

9/9/2019

 

 

208,333

 

 

 

183,812

 

 

 

173,450

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Anthem Sports & Entertainment Inc.
     Media: Broadcasting & Subscription

(8)(13)(14)(21)

Senior Secured Loan — Term Loan
10.5% Cash, 3 Month Libor (1.00%) + 9.50%; Libor Floor 1.00%, Due 9/24

 

9/9/2019

 

 

3,112,292

 

 

 

3,044,915

 

 

 

3,012,077

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AP Core Holdings II, LLC
     Media: Diversified & Production

(8)(14)

Senior Secured Loan — First Lien Term Loan
6.3% Cash, 1 Month Libor (0.75%) + 5.50%; Libor Floor 0.75%, Due 7/27

 

7/21/2021

 

 

4,000,000

 

 

 

3,940,477

 

 

 

4,023,340

 

 

9


 

Portfolio Company /
Principal Business

 

Investment
Interest Rate¹ / Maturity
15

 

Initial
Acquisition
Date

 

Principal

 

 

Amortized
Cost

 

 

Fair Value2

 

AP Core Holdings II, LLC
     Media: Diversified & Production

(8)(13)(14)

Senior Secured Loan — First Lien Term Loan
6.3% Cash, 1 Month Libor (0.75%) + 5.50%; Libor Floor 0.75%, Due 7/27

 

7/21/2021

 

 

4,000,000

 

 

 

3,940,589

 

 

 

3,940,000