10-Q
Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2020

OR

 

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 814-00861

Fidus Investment Corporation

(Exact Name of Registrant as Specified in its Charter)

 

Maryland   27-5017321

(State or Other Jurisdiction of

Incorporation or Organization)

 

(I.R.S. Employer

Identification No.)

1603 Orrington Avenue, Suite 1005

Evanston, Illinois

  60201
(Address of Principal Executive Offices)   (Zip Code)

(847) 859-3940

(Registrant’s telephone number, including area code)

 

 

n/a

(Former name, former address and former fiscal year, if changed since last report)

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading
Symbol

 

Name of each exchange
on which registered

Common Stock, par value $0.001 per share   FDUS   The NASDAQ Global Select Market
5.875% Notes due 2023   FDUSL   The NASDAQ Global Select Market
6.000% Notes due 2024   FDUSZ   The NASDAQ Global Select Market
5.375% Notes due 2024   FDUSG   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 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

 

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  ☒

As of October 29, 2020, the Registrant had outstanding 24,437,400 shares of common stock, $0.001 par value.

 

 

 


Table of Contents

FIDUS INVESTMENT CORPORATION

TABLE OF CONTENTS

QUARTERLY REPORT ON FORM 10-Q

 

PART I — FINANCIAL INFORMATION

 

Item 1.

  Financial Statements.      3  
  Consolidated Statements of Assets and Liabilities — September 30, 2020 (unaudited) and December 31, 2019      3  
  Consolidated Statements of Operations — Three and Nine Months Ended September 30, 2020 (unaudited) and 2019 (unaudited)      4  
  Consolidated Statements of Changes in Net Assets — Three and Nine Months Ended September 30, 2020 (unaudited) and 2019 (unaudited)      5  
  Consolidated Statements of Cash Flows — Nine Months Ended September 30, 2020 (unaudited) and 2019 (unaudited)      6  
  Consolidated Schedules of Investments — September 30, 2020 (unaudited) and December 31, 2019      7  
  Notes to Consolidated Financial Statements (unaudited)      17  

Item 2.

  Management’s Discussion and Analysis of Financial Condition and Results of Operations.      40  

Item 3.

  Quantitative and Qualitative Disclosures About Market Risk.      59  

Item 4.

  Controls and Procedures.      60  

PART II — OTHER INFORMATION

  

Item 1.

  Legal Proceedings.      61  

Item 1A.

  Risk Factors.      61  

Item 2.

  Unregistered Sales of Equity Securities and Use of Proceeds.      65  

Item 3.

  Defaults Upon Senior Securities.      66  

Item 4.

  Mine Safety Disclosures.      66  

Item 5.

  Other Information.      66  

Item 6.

  Exhibits.      67  

Signatures

     68  

Exhibit Index

  

 

2


Table of Contents

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

FIDUS INVESTMENT CORPORATION

Consolidated Statements of Assets and Liabilities

(in thousands, except shares and per share data)

 

    September 30,
2020
(unaudited)
    December 31,
2019
 

ASSETS

   

Investments, at fair value:

   

Control investments (cost: $31,044 and $27,718, respectively)

  $ 23,989     $ 21,820  

Affiliate investments (cost: $40,920 and $56,328, respectively)

    77,852       121,555  

Non-control/non-affiliate  investments (cost: $644,455 and $620,453, respectively)

    613,564       623,544  
 

 

 

   

 

 

 

Total investments, at fair value (cost: $716,419 and $704,499, respectively)

    715,405       766,919  

Cash and cash equivalents

    24,682       15,012  

Interest receivable

    7,071       6,331  

Prepaid expenses and other assets

    1,143       1,177  
 

 

 

   

 

 

 

Total assets

  $ 748,301     $ 789,439  
 

 

 

   

 

 

 

LIABILITIES

   

SBA debentures, net of deferred financing costs (Note 6)

  $ 143,871     $ 153,802  

Public Notes, net of deferred financing costs (Note 6)

    177,883       176,901  

Borrowings under Credit Facility, net of deferred financing costs (Note 6)

    21,837       23,899  

Accrued interest and fees payable

    2,122       3,505  

Base management fee payable – due to affiliate

    3,224       3,334  

Income incentive fee payable – due to affiliate

    2,374       1,497  

Capital gains incentive fee payable – due to affiliate

    6,335       12,715  

Administration fee payable and other – due to affiliate

    554       487  

Taxes payable

    123       547  

Accounts payable and other liabilities

    426       442  
 

 

 

   

 

 

 

Total liabilities

    358,749       377,129  
 

 

 

   

 

 

 

Commitments and contingencies (Note 7)

   

NET ASSETS

   

Common stock, $0.001 par value (100,000,000 shares authorized, 24,437,400 and 24,463,119 shares issued and
outstanding at September 30, 2020 and December 31, 2019, respectively)

    24       24  

Additional paid-in capital

    365,793       366,061  

Total distributable earnings

    23,735       46,225  
 

 

 

   

 

 

 

Total net assets

    389,552       412,310  
 

 

 

   

 

 

 

Total liabilities and net assets

  $ 748,301     $ 789,439  
 

 

 

   

 

 

 

Net asset value per common share

  $ 15.94     $ 16.85  
 

 

 

   

 

 

 

See Notes to Consolidated Financial Statements (unaudited).

 

3


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Statements of Operations (unaudited)

(in thousands, except shares and per share data)

 

    Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
    2020     2019     2020     2019  

Investment Income:

       

Interest income

       

Control investments

  $ 467     $ 70     $ 1,348     $ 420  

Affiliate investments

    849       1,192       2,663       4,126  

Non-control/non-affiliate  investments

    17,449       14,871       51,060       40,686  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total interest income

    18,765       16,133       55,071       45,232  

Payment-in-kind interest income

       

Control investments

    453       191       1,323       1,611  

Affiliate investments

    106       86       175       254  

Non-control/non-affiliate  investments

    690       1,976       2,013       5,973  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total payment-in-kind  interest income

    1,249       2,253       3,511       7,838  

Dividend income

       

Control investments

    —         —         —         —    

Affiliate investments

    357       1       465       942  

Non-control/non-affiliate  investments

    114       (39     160       (54
 

 

 

   

 

 

   

 

 

   

 

 

 

Total dividend income

    471       (38     625       888  

Fee income

       

Control investments

    —         —         —         349  

Affiliate investments

    6       4       72       26  

Non-control/non-affiliate  investments

    421       821       1,878       3,150  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total fee income

    427       825       1,950       3,525  

Interest on idle funds and other income

    165       28       336       116  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total investment income

    21,077       19,201       61,493       57,599  
 

 

 

   

 

 

   

 

 

   

 

 

 

Expenses:

       

Interest and financing expenses

    4,878       4,421       14,701       12,197  

Base management fee

    3,223       3,179       9,688       9,066  

Incentive fee - income

    2,374       2,163       6,342       5,947  

Incentive fee - capital gains

    2,761       1,307       (6,380     373  

Administrative service expenses

    412       422       1,242       1,199  

Professional fees

    301       217       1,508       1,213  

Other general and administrative expenses

    224       210       1,059       1,025  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses before income incentive fee waiver

    14,173       11,919       28,160       31,020  
 

 

 

   

 

 

   

 

 

   

 

 

 

Incentive fee waiver - income

    —         —         (423     —    
 

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses, net of income incentive fee waiver

    14,173       11,919       27,737       31,020  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income before income taxes

    6,904       7,282       33,756       26,579  

Income tax provision (benefit)

    2       (80     146       (25
 

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

    6,902       7,362       33,610       26,604  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net realized and unrealized gains (losses) on investments:

       

Net realized gains (losses):

       

Control investments

    —         —         —         (1,268

Affiliate investments

    (65     26       24,354       (73

Non-control/non-affiliate  investments

    1,380       10,507       8,543       10,172  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total net realized gain (loss) on investments

    1,315       10,533       32,897       8,831  
 

 

 

   

 

 

   

 

 

   

 

 

 

Income tax (provision) benefit from realized gains on investments

    —         32       (1,065     (261

Net change in unrealized appreciation (depreciation):

       

Control investments

    607       (9,843     (1,157     (8,270

Affiliate investments

    7,158       (1,701     (28,295     3,585  

Non-control/non-affiliate  investments

    4,899       7,722       (33,982     (1,621
 

 

 

   

 

 

   

 

 

   

 

 

 

Total net change in unrealized appreciation (depreciation) on investments

    12,664       (3,822     (63,434     (6,306
 

 

 

   

 

 

   

 

 

   

 

 

 

Net gain (loss) on investments

    13,979       6,743       (31,602     2,264  

Realized losses on extinguishment of debt

    (174     (210     (299     (399
 

 

 

   

 

 

   

 

 

   

 

 

 

Net increase in net assets resulting from operations

  $ 20,707     $ 13,895     $ 1,709     $ 28,469  
 

 

 

   

 

 

   

 

 

   

 

 

 

Per common share data:

       

Net investment income per share-basic and diluted

  $ 0.28     $ 0.30     $ 1.37     $ 1.09  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net increase in net assets resulting from operations per share — basic and diluted

  $ 0.85     $ 0.57     $ 0.07     $ 1.16  
 

 

 

   

 

 

   

 

 

   

 

 

 

Dividends declared per share

  $ 0.30     $ 0.39     $ 0.99     $ 1.17  
 

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of shares outstanding — basic and diluted

    24,437,400       24,463,119       24,444,120       24,463,119  
 

 

 

   

 

 

   

 

 

   

 

 

 

See Notes to Consolidated Financial Statements (unaudited).

 

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Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Statements of Changes in Net Assets (unaudited)

(in thousands, except shares)

 

     Common Stock     Additional     Total        
     Number of     Par     paid-in     distributable     Total net  
     shares     value     capital     earnings     assets  

Balances at December 31, 2018

     24,463,119     $ 24     $ 366,278     $ 36,683     $ 402,985  

Net investment income

     —         —         —         9,599       9,599  

Net realized gain (loss) on investments, net of taxes

     —         —         —         (1,583     (1,583

Net unrealized appreciation (depreciation) on investments

     —         —         —         3,545       3,545  

Realized losses on extinguishment of debt

     —         —         —         (189     (189

Dividends declared

     —         —         —         (9,541     (9,541
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balances at March 31, 2019

     24,463,119     $ 24     $ 366,278     $ 38,514     $ 404,816  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

     —         —         —         9,643       9,643  

Net realized gain (loss) on investments, net of taxes

     —         —         —         (412     (412

Net unrealized appreciation (depreciation) on investments

     —         —         —         (6,029     (6,029

Realized losses on extinguishment of debt

     —         —         —         —         —    

Dividends declared

     —         —         —         (9,540     (9,540
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balances at June 30, 2019

     24,463,119     $ 24     $ 366,278     $ 32,176     $ 398,478  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

     —         —         —         7,362       7,362  

Net realized gain (loss) on investments, net of taxes

     —         —         —         10,565       10,565  

Net unrealized appreciation (depreciation) on investments

     —         —         —         (3,822     (3,822

Realized losses on extinguishment of debt

     —         —         —         (210     (210

Dividends declared

     —         —         —         (9,541     (9,541
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balances at September 30, 2019

     24,463,119     $ 24     $ 366,278     $ 36,530     $ 402,832  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balances at December 31, 2019

     24,463,119     $ 24     $ 366,061     $ 46,225     $ 412,310  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Repurchases of common stock under Stock Repurchase Program (Note 8)

     (25,719     (0 )*      (268     —         (268

Net investment income

     —         —         —         17,417       17,417  

Net realized gain (loss) on investments, net of taxes

     —         —         —         30,327       30,327  

Net unrealized appreciation (depreciation) on investments

     —         —         —         (74,590     (74,590

Realized losses on extinguishment of debt

     —         —         —         (125     (125

Dividends declared

     —         —         —         (9,537     (9,537
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balances at March 31, 2020

     24,437,400     $ 24     $ 365,793     $ 9,717     $ 375,534  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

     —         —         —         9,291       9,291  

Net realized gain (loss) on investments, net of taxes

     —         —         —         190       190  

Net unrealized appreciation (depreciation) on investments

     —         —         —         (1,508     (1,508

Realized losses on extinguishment of debt

     —         —         —         —         —    

Dividends declared

     —         —         —         (7,331     (7,331
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balances at June 30, 2020

     24,437,400     $ 24     $ 365,793     $ 10,359     $ 376,176  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

     —         —         —         6,902       6,902  

Net realized gain (loss) on investments, net of taxes

     —         —         —         1,315       1,315  

Net unrealized appreciation (depreciation) on investments

     —         —         —         12,664       12,664  

Realized losses on extinguishment of debt

     —         —         —         (174     (174

Dividends declared

     —         —         —         (7,331     (7,331
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balances at September 30, 2020

     24,437,400     $ 24     $ 365,793     $ 23,735     $ 389,552  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

* amount is greater than zero but less than one

See Notes to Consolidated Financial Statements (unaudited).

 

5


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Statements of Cash Flows (unaudited)

(in thousands)

 

     Nine Months Ended September 30,  
     2020     2019  

Cash Flows from Operating Activities:

    

Net increase in net assets resulting from operations

   $ 1,709     $ 28,469  

Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by (used for) operating activities:

    

Net change in unrealized (appreciation) depreciation on investments

     63,434       6,306  

Net realized (gain) loss on investments

     (32,897     (8,831

Interest and dividend income paid-in-kind

     (3,511     (7,838

Accretion of original issue discount

     (118     (51

Accretion of loan origination fees

     (866     (796

Purchase of investments

     (86,121     (175,535

Proceeds from sales and repayments of investments

     110,149       98,805  

Proceeds from loan origination fees

     1,444       1,480  

Realized losses on extinguishment of debt

     299       399  

Amortization of deferred financing costs

     1,680       1,315  

Changes in operating assets and liabilities:

    

Interest receivable

     (740     1,045  

Prepaid expenses and other assets

     34       44  

Accrued interest and fees payable

     (1,383     (1,169

Base management fee payable – due to affiliate

     (110     252  

Income incentive fee payable – due to affiliate

     877       (622

Capital gains incentive fee payable – due to affiliate

     (6,380     373  

Administration fee payable and other – due to affiliate

     67       (275

Taxes payable

     (424     (802

Accounts payable and other liabilities

     (16     250  
  

 

 

   

 

 

 

Net cash provided by (used for) operating activities

     47,127       (57,181
  

 

 

   

 

 

 

Cash Flows from Financing Activities:

    

Proceeds received from SBA debentures

     6,000       7,500  

Repayments of SBA debentures

     (16,500     (41,000

Proceeds received from issuance of Public Notes

           69,000  

Proceeds received from (repayments of) borrowings under Credit Facility, net

     (2,000     30,000  

Payment of deferred financing costs

     (490     (4,186

Dividends paid to stockholders, including expenses

     (24,199     (28,622

Repurchases of common stock under Stock Repurchase Program

     (268      
  

 

 

   

 

 

 

Net cash provided by (used for) financing activities

     (37,457     32,692  
  

 

 

   

 

 

 

Net increase (decrease) in cash and cash equivalents

     9,670       (24,489

Cash and cash equivalents:

    

Beginning of period

     15,012       42,015  
  

 

 

   

 

 

 

End of period

   $ 24,682     $ 17,526  
  

 

 

   

 

 

 

Supplemental disclosure of cash flow information:

    

Cash payments for interest

   $ 14,404     $ 12,050  

Cash payments for taxes, net of tax refunds received

   $ 1,635     $ 1,038  

See Notes to Consolidated Financial Statements (unaudited).

 

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FIDUS INVESTMENT CORPORATION

Consolidated Schedule of Investments (unaudited)

September 30, 2020

(in thousands, except shares)

 

Portfolio Company (a)(b)       Variable Index   Rate (e)     Investment           Principal           Fair     Percent of  

Investment Type (c)        

  Industry  

Spread / Floor (d)

  Cash/PIK     Date (f)     Maturity     Amount     Cost     Value (g)     Net Assets  

Control Investments (t)

                 

FDS Avionics Corp. (dba Flight Display Systems)

  Aerospace & Defense Manufacturing                

Second Lien Debt

        6.00%/9.00%       11/5/2014       12/31/2021     $ 4,728     $ 4,728     $ 3,791    

Revolving Loan ($30 commitment)

        6.00%/9.00%       4/12/2018       12/31/2021       279       279       279    

Common Equity (7,478 shares) (j)

          11/10/2017           748       —      

Preferred Equity (2,550 shares)

          12/26/2019           2,550       —      
             

 

 

   

 

 

   
                8,305       4,070       1

US GreenFiber, LLC

  Building Products Manufacturing                

Second Lien Debt (j)

        8.00%/5.00%       7/3/2014       8/30/2024       15,182       15,176       13,855    

Second Lien Debt (j)

        8.50%/6.50%       11/9/2018       8/30/2024       4,943       4,943       5,054    

Second Lien Debt (j)

        8.50%/6.50%       8/10/2020       8/30/2024       1,010       1,010       1,010    

Common Equity (2,522 units) (h)(j)

          7/3/2014           586       —      

Common Equity (425,508 units) (j)

          8/30/2019           1       —      

Common Equity (1,022,813 units) (h)

          7/1/2020           1,023       —      
             

 

 

   

 

 

   
                22,739       19,919       5
             

 

 

   

 

 

   

Total Control Investments

              $ 31,044     $ 23,989       6
             

 

 

   

 

 

   

Affiliate Investments (l)

                 

FAR Research Inc. (n)

  Specialty Chemicals                

Common Equity (1,396 units)

          3/31/2014         $ —       $ 28       0

Fiber Materials, Inc. (n)

  Aerospace & Defense Manufacturing                

Common Equity (10 units)

          11/30/2016           —         42       0

Medsurant Holdings, LLC

  Healthcare Services                

Second Lien Debt (j)

        13.00%/0.00%       12/18/2015       3/10/2022       8,031       8,028       8,090    

Preferred Equity (63,331 units) (h)(j)

          4/12/2011           673       655    

Warrant (252,588 units) (h)(j)(m)

          4/12/2011           2,258       2,295    
             

 

 

   

 

 

   
                10,959       11,040       3

Mirage Trailers LLC

  Utility Equipment Manufacturing                

Second Lien Debt (k)

    (L + 10.00%) / (1.00%)     11.00%/5.00%       11/25/2015       11/25/2021       6,327       6,395       6,327    

Common Equity (2,500,000 shares) (o)

          11/25/2015           2,187       —      
             

 

 

   

 

 

   
                8,582       6,327       2

Pfanstiehl, Inc.

  Healthcare Products                

Subordinated Debt

        10.50%/0.00%       3/29/2013       9/29/2024       6,208       6,204       6,208    

Common Equity (4,250 units) (j)

          3/29/2013           425       27,104    
             

 

 

   

 

 

   
                6,629       33,312       9

Pinnergy, Ltd.

  Oil & Gas Services                

Common Equity - Class A-2 (42,500 units) (j)

          10/13/2016           3,000       13,743    

Common Equity - Class B (1,000 units) (j)

          10/13/2016           3,000       3,259    
             

 

 

   

 

 

   
                6,000       17,002       3
Steward Holding LLC (dba Steward Advanced Materials)   Aerospace & Defense Manufacturing                

Second Lien Debt

        12.00%/1.50%       11/12/2015       5/12/2021       7,754       7,750       7,754    

Common Equity (1,000,000 units)

          11/12/2015           1,000       2,347    
             

 

 

   

 

 

   
                8,750       10,101       3
             

 

 

   

 

 

   

Total Affiliate Investments

              $ 40,920     $ 77,852       20
             

 

 

   

 

 

   

 

7


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Schedule of Investments (unaudited)

September 30, 2020

(in thousands, except shares)

 

Portfolio Company (a)(b)         Variable Index   Rate (e)     Investment           Principal           Fair     Percent of  

Investment Type (c)        

  Industry    

Spread / Floor (d)

  Cash/PIK     Date (f)     Maturity     Amount     Cost     Value (g)     Net Assets  

Non-control/Non-affiliate Investments

                 

Accent Food Services, LLC

    Vending Equipment Manufacturing                  

Second Lien Debt (k)(p)

        0.00%/17.00%       11/30/2016       5/30/2022     $ 35,410     $ 35,328     $ 5,333    

Common Equity (7,885 units) (h)(j)

          11/30/2016           800       —      
             

 

 

   

 

 

   
                36,128       5,333       1

Allied 100 Group, Inc.

    Healthcare Products                  

Subordinated Debt (k)

        11.25%/0.00%       7/31/2019       5/26/2023       21,500       21,425       21,500    

Common Equity (625,000 units) (j)

          11/26/2014           625       1,054    
             

 

 

   

 

 

   
                22,050       22,554       6

Allredi, LLC (fka Marco Group International OpCo, LLC)

    Industrial Cleaning & Coatings                  

Second Lien Debt

        10.50%/0.75%       3/2/2020       9/2/2026       10,044       9,954       8,044    

Common Equity (570,636 units) (h)(j)

          7/21/2017           637       449    
             

 

 

   

 

 

   
                10,591       8,493       2

Alzheimer’s Research and Treatment Center, LLC

    Healthcare Services                  

First Lien Debt (j)(w)

    (L + 5.75%) / (2.00%)     7.75%/0.00%       10/23/2018       10/23/2023       6,500       6,469       6,500    

Common Equity (500 units) (h)(j)

          10/23/2018           500       853    
             

 

 

   

 

 

   
                6,969       7,353       2
American AllWaste LLC (dba WasteWater Transport Services)     Environmental Industries                  

Second Lien Debt (j)

    (L + 11.00%) / (2.00%)     13.00%/0.00%       5/31/2018       11/30/2023       17,503       17,428       17,503    

Preferred Equity (500 units) (h)(j)

          5/31/2018           500       316    

Preferred Equity (207 units) (h)(j)

          8/6/2019           250       250    
             

 

 

   

 

 

   
                18,178       18,069       5

Argo Turboserve Corporation

    Business Services                  

Second Lien Debt (j)

    (L + 10.75%) / (2.00%)     12.75%/0.00%       12/26/2018       6/28/2023       13,313       13,267       13,313       3
                 

AVC Investors, LLC (dba Auveco)

    Specialty Distribution                  

Second Lien Debt (k)

        11.50%/0.00%       1/3/2018       7/3/2023       22,500       22,443       22,500    

Common Equity (5,000 units) (j)

          1/3/2018           487       455    
             

 

 

   

 

 

   
                22,930       22,955       6

B&B Roadway and Security Solutions, LLC

    Component Manufacturing                  

Second Lien Debt

        11.25%/4.00%       2/27/2018       1/1/2022       10,800       10,774       10,569    

Common Equity (50,000 units) (h)(j)

          2/27/2018           497       —      
             

 

 

   

 

 

   
                11,271       10,569       3

Bandon Fitness (Texas), Inc.

    Retail                  

First Lien Debt (j)(z)

    (L + 6.50%) / (2.25%)     8.75%/0.25%       8/9/2019       8/9/2024       14,680       14,264       14,495    

Common Equity (545,810 units) (j)

          8/9/2019           931       542    
             

 

 

   

 

 

   
                15,195       15,037       4

BCC Group Holdings, Inc.

    Information Technology Services                  

Subordinated Debt

        11.00%/1.00%       1/28/2019       4/11/2023       18,304       18,195       18,304    

Common Equity (451 shares)

          1/28/2019           232       228    

Preferred Equity (14 shares)

          1/28/2019           143       143    
             

 

 

   

 

 

   
                18,570       18,675       5

BCM One Group Holdings, Inc.

    Information Technology Services                  

Subordinated Debt (k)

        11.00%/0.00%       1/3/2019       7/3/2024       29,000       28,889       29,000    

Common Equity (1,143 shares)

          1/3/2019           1       149    

Preferred Equity (66 shares)

          1/3/2019           665       665    
             

 

 

   

 

 

   
                29,555       29,814       8

Bedford Precision Parts LLC

    Specialty Distribution                  

First Lien Debt (j)(s)

    (L + 6.25%) / (2.00%)     8.25%/0.00%       3/12/2019       3/12/2024       4,555       4,530       4,422    

Common Equity (500,000 units) (h)(j)

          3/12/2019           500       277    
             

 

 

   

 

 

   
                5,030       4,699       1

Cardboard Box LLC (dba Anthony’s Coal Fired Pizza)

    Restaurants                  

Common Equity (521,021 units) (j)

          12/15/2015           521       —      

Preferred Equity (1,043,133 units) (j)

          12/6/2019           96       43    
             

 

 

   

 

 

   
                617       43       0

Combined Systems, Inc.

    Aerospace & Defense Manufacturing                  

First Lien Debt

    (L + 10.00%) / (2.00%)     12.00%/0.00%       1/31/2020       1/31/2025       7,700       7,650       7,700    

Revolving Loan ($200 commitment) (j)(ac)

    (L + 9.00%) / (2.00%)     11.00%/0.00%       1/31/2020       1/31/2025       3,800       3,778       3,800    
             

 

 

   

 

 

   
                11,428       11,500       3

ControlScan, Inc.

    Information Technology Services                  

Subordinated Debt (j)

        11.00%/0.00%       7/28/2017       1/28/2023       6,750       6,736       6,750    

Common Equity (1,852 shares) (j)

          7/28/2017           2       423    

Preferred Equity (50 shares) (j)

          7/28/2017           498       498    
             

 

 

   

 

 

   
                7,236       7,671       2

CRS Solutions Holdings, LLC (dba CRS Texas)

    Business Services                  

Second Lien Debt

        10.50%/1.50%       3/14/2018       4/30/2024       11,262       11,224       11,262    

Common Equity (375,000 units) (h)(j)

          3/14/2018           375       210    
             

 

 

   

 

 

   
                11,599       11,472       3

Diversified Search LLC

    Business Services                  

First Lien Debt (k)(r)

    (L + 8.00%) / (1.75%)     9.75%/0.00%       2/7/2019       2/7/2024       17,355       17,143       17,355    

Common Equity (573 units) (h)(j)

          2/7/2019           593       258    
             

 

 

   

 

 

   
                17,736       17,613       5

EBL, LLC (EbLens)

    Retail                  

Second Lien Debt (j)

        12.50%/1.50%       7/13/2017       1/13/2023       9,253       9,210       6,366    

Common Equity (75,000 units) (j)

          7/13/2017           750       —      
             

 

 

   

 

 

   
                9,960       6,366       2

ECM Industries, LLC

    Component Manufacturing                  

Subordinated Debt (j)

        11.50%/0.00%       4/30/2020       5/23/2026       11,500       11,286       11,286    

Common Equity (1,000,000 units) (h)(j)

          4/30/2020           1,000       1,000    
             

 

 

   

 

 

   
                12,286       12,286       3

French Transit, LLC

    Consumer Products                  

First Lien Debt (j)

    (L + 10.00%) / (2.25%)     12.25%/0.00%       6/21/2019       6/21/2024       4,116       4,086       4,116       1

 

8


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Schedule of Investments (unaudited)

September 30, 2020

(in thousands, except shares)

 

Portfolio Company (a)(b)         Variable Index   Rate (e)     Investment           Principal           Fair     Percent of  

Investment Type (c)        

  Industry    

Spread / Floor (d)

  Cash/PIK     Date (f)     Maturity     Amount     Cost     Value (g)     Net Assets  

Global Plasma Solutions, Inc.

    Component Manufacturing                  

First Lien Debt (j)(v)

    (L + 5.00%) / (2.00%)     7.00%/0.00%       9/21/2018       9/21/2023     $ 4,338     $ 4,291     $ 4,338    

Preferred Equity (947 shares) (j)

          9/21/2018           360       423    

Common Equity (947 shares) (j)

          9/21/2018           15       4,429    
             

 

 

   

 

 

   
                4,666       9,190       2

Gurobi Optimization, LLC

    Information Technology Services                  

Common Equity (3 shares)

          12/19/2017           750       1,796       0
                 

Haematologic Technologies, Inc.

    Healthcare Services                  

First Lien Debt (x)

    (L + 7.25%) / (2.00%)     9.25%/0.00%       10/11/2019       10/11/2024       5,500       5,467       5,353    

Common Equity (500 units) (h)(j)

          10/11/2019           500       279    
             

 

 

   

 

 

   
                5,967       5,632       1

Hilco Plastics Holdings, LLC (dba Hilco Technologies)

    Component Manufacturing                  

Second Lien Debt (j)

        11.50%/1.50%       9/23/2016       12/31/2019       10,253       10,253       8,696    

Revolving Loan (j)

    (L + 6.50%) / (0.00%)     6.66%/0.00%       12/20/2019       12/15/2019       5,962       5,962       5,962    

First Lien Debt (j)

    (L + 6.95%) / (0.00%)     7.11%/0.00%       12/20/2019       12/15/2019       5,476       5,476       5,476    

Preferred Equity (1,000,000 units) (h)(j)

          4/18/2018           1,000       —      

Common Equity (72,507 units) (h)(j)

          9/23/2016           473       —      
             

 

 

   

 

 

   
                23,164       20,134       5

Hoonuit, LLC

    Information Technology Services                  

Preferred Equity (610 units) (h)(j)

          6/20/2019       1/1/2022         250       298       0
                 

Hub Acquisition Sub, LLC (dba Hub Pen)

    Promotional products                  

Second Lien Debt (k)

        13.00%/0.00%       3/23/2016       9/23/2021       25,000       24,970       23,327    

Common Equity (3,750 units)

          3/23/2016           132       143    
             

 

 

   

 

 

   
                25,102       23,470       6

IBH Holdings, LLC (fka Inflexxion, Inc.)

    Business Services                  

Common Equity (150,000 units)

          6/20/2018           —         97       0
                 

Ipro Tech, LLC

    Information Technology Services                  

First Lien Debt (j)(u)

    (L + 8.50%) / (2.00%)     10.50%/0.00%       6/30/2020       6/30/2025       2,484       1,912       1,912       0
                 

K2 Merger Agreement Agent, LLC (fka K2 Industrial Services, Inc.) (n)

    Industrial Cleaning & Coatings                  

Second Lien Debt (j)

        0.00%/10.00%       1/28/2019       1/28/2021       2,087       2,087       2,087       1
                 

The Kyjen Company, LLC (dba Outward Hound)

    Consumer Products                  

Second Lien Debt (k)

        12.00%/0.00%       12/8/2017       6/8/2024       15,000       14,957       15,000    

Common Equity (765 shares) (j)

          12/8/2017           765       773    
             

 

 

   

 

 

   
                15,722       15,773       4

LNG Indy, LLC (dba Kinetrex Energy)

    Oil & Gas Distribution                  

Second Lien Debt (k)

        11.50%/1.50%       12/28/2016       11/12/2021       10,089       10,064       10,089    

Common Equity (500 units)

          12/28/2016           500       769    
             

 

 

   

 

 

   
                10,564       10,858       3

Mesa Line Services, LLC

    Utilities: Services                  

Second Lien Debt (j)

        10.50%/1.75%       11/30/2017       8/1/2024       17,452       17,378       17,452    

Common Equity (981 shares) (j)

          11/30/2017           1,148       853    
             

 

 

   

 

 

   
                18,526       18,305       5

Midwest Transit Equipment, Inc.

    Transportation services                  

Warrant (7,192 shares) (j)(m)

          6/23/2017           180       64    

Warrant (9.59% of Junior Subordinated Notes) (j)(q)

          6/23/2017           190       245    
             

 

 

   

 

 

   
                370       309       0

NGT Acquisition Holdings, LLC (dba Techniks Industries)

    Component Manufacturing                  

Common Equity (378 units) (j)

          5/24/2017           500       219       0
                 

OMC Investors, LLC (dba Ohio Medical Corporation)

    Healthcare Products                  

Second Lien Debt

        12.00%/0.00%       1/15/2016       6/30/2022       10,000       9,982       10,000    

Common Equity (5,000 units)

          1/15/2016           487       906    
             

 

 

   

 

 

   
                10,469       10,906       3

Palisade Company, LLC

    Information Technology Services                  

Subordinated Debt (j)

        11.75%/0.00%       11/15/2018       5/15/2024       6,500       6,479       6,500    

Common Equity (50 shares) (j)

          11/15/2018           500       585    
             

 

 

   

 

 

   
                6,979       7,085       2

Palmetto Moon, LLC

    Retail                  

First Lien Debt (j)

        11.50%/2.50%       11/3/2016       10/31/2021       4,828       4,820       4,512    

Common Equity (499 units) (j)

          11/3/2016           494       44    
             

 

 

   

 

 

   
                5,314       4,556       1

Power Grid Components, Inc.

    Specialty Distribution                  

Second Lien Debt (k)

        11.00%/1.00%       4/12/2018       12/2/2025       22,375       22,296       22,375    

Preferred Equity (392 shares) (j)

          4/12/2018           392       496    

Preferred Equity (48 shares) (j)

          12/2/2019           48       61    

Common Equity (10,622 shares) (j)

          4/12/2018           462       706    
             

 

 

   

 

 

   
                23,198       23,638       6

Prime AE Group, Inc.

    Business Services                  

First Lien Debt (j)

    (L + 6.25%) / (2.00%)     8.25%/0.00%       11/25/2019       11/25/2024       7,000       6,840       7,000    

Preferred Equity (500,000 shares) (j)

          11/25/2019           500       559    
             

 

 

   

 

 

   
              $ 7,340     $ 7,559       2

 

9


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Schedule of Investments (unaudited)

September 30, 2020

(in thousands, except shares)

 

Portfolio Company (a)(b)       Variable Index   Rate (e)     Investment           Principal           Fair     Percent of  

Investment Type (c)        

  Industry  

Spread / Floor (d)

  Cash/PIK     Date (f)     Maturity     Amount     Cost     Value (g)     Net Assets  

Pugh Lubricants, LLC

  Specialty Distribution                

Second Lien Debt (k)

        12.25%/0.00%       11/10/2016       5/10/2022     $  26,581     $ 26,530     $ 26,631    

Common Equity (3,062 units) (h)(j)

          11/10/2016           308       735    
             

 

 

   

 

 

   
                26,838       27,366       7

Revenue Management Solutions, LLC

  Information Technology Services                

Common Equity (113 shares)

          1/4/2017           1,125       2,887       1
                 

Rhino Assembly Company, LLC

  Specialty Distribution                

Second Lien Debt (k)

        12.00%/1.00%       8/11/2017       2/11/2023       11,527       11,499       10,974    

Delayed Draw Commitment ($875 commitment) (i)(j)

        12.00%/1.00%       8/11/2017       5/17/2022       —         —         —      

Preferred Equity (8,864 units) (h)(j)

          8/11/2017           944       604    
             

 

 

   

 

 

   
                12,443       11,578       3

Road Safety Services, Inc.

  Business Services                

Second Lien Debt

        11.25%/1.50%       9/18/2018       3/18/2024       10,339       10,309       10,339    

Common Equity (655 units)

          9/18/2018           621       1,022    
             

 

 

   

 

 

   
                10,930       11,361       3

Rohrer Corporation

  Packaging                

Subordinated Debt (j)

        10.50%/1.00%       10/1/2018       4/1/2024       13,981       13,937       13,981    

Common Equity (400 shares) (j)

          7/18/2016           780       1,307    
             

 

 

   

 

 

   
                14,717       15,288       4

Routeware, Inc.

  Information Technology Services                

First Lien Debt (k)(aa)

    (L + 7.00%) / (1.75%)     8.75%/0.00%       2/7/2020       2/7/2025       14,926       14,846       14,926       4
                 

SES Investors, LLC (dba SES Foam)

  Building Products Manufacturing                

Second Lien Debt

        13.00%/0.00%       9/8/2016       12/29/2022       2,500       2,497       2,500    

Common Equity (6,000 units) (h)(j)

          9/8/2016           562       1,547    
             

 

 

   

 

 

   
                3,059       4,047       1

Software Technology, LLC

  Information Technology Services                

Subordinated Debt (k)

        11.00%/0.00%       12/23/2016       6/23/2023       10,000       9,978       10,000    

Common Equity (6 shares)

          12/23/2016           646       854    
             

 

 

   

 

 

   
                10,624       10,854       3

Specialized Elevator Services Holdings, LLC

  Business Services                

First Lien Debt (j)(y)

    (L + 5.50%) / (2.00%)     7.50%/0.00%       5/7/2019       5/3/2024       12,889       12,774       12,889    

Common Equity (500 units) (j)

          5/8/2019           596       608    
             

 

 

   

 

 

   
                13,370       13,497       3

SpendMend LLC

  Business Services                

Common Equity (1,000,000 units)

          1/8/2018           972       1,913       0
                 

TransGo, LLC

  Component Manufacturing                

Common Equity (500 units) (j)

          2/28/2017           481       743       0
                 

The Tranzonic Companies

  Specialty Distribution                

Subordinated Debt (j)

        10.00%/1.00%       3/27/2018       3/27/2025       6,984       6,939       6,984    

Preferred Equity (5,653 units) (j)

          3/27/2018           565       712    

Common Equity (1 units) (j)

          3/27/2018           —         354    
             

 

 

   

 

 

   
                7,504       8,050       2

UBEO, LLC

  Business Services                

Subordinated Debt (j)

        11.00%/0.00%       4/3/2018       10/3/2024       13,893       13,808       13,596    

Common Equity (705,000 units) (h)(j)

          4/3/2018           668       810    
             

 

 

   

 

 

   
                14,476       14,406       4

United Biologics, LLC

  Healthcare Services                

Preferred Equity (98,377 units) (h)(j)

          4/1/2012           1,008       —      

Warrant (57,469 units) (j)(m)

          3/5/2012           566       —      
             

 

 

   

 

 

   
                1,574       —         0

Virginia Tile Company, LLC

  Specialty Distribution                

Second Lien Debt (j)

        12.25%/0.00%       12/19/2014       4/7/2022       12,000       11,995       12,000    

Common Equity (17 units) (j)

          12/19/2014           343       463    
             

 

 

   

 

 

   
                12,338       12,463       3

Western’s Smokehouse, LLC

  Consumer Products                

First Lien Debt (j)(ab)

    (L + 6.50%) / (1.25%)     7.75%/0.00%       2/28/2020       12/23/2024       10,000       9,868       9,924       3
                 

Wheel Pros, Inc.

  Specialty Distribution                

Second Lien Debt (j)

    (L + 8.50%) / (0.00%)     8.65%/0.00%       5/17/2019       4/4/2026       20,000       19,840       20,000    

Preferred Equity (347,222 units) (j)

          5/15/2019           632       950    
             

 

 

   

 

 

   
                20,472       20,950       5

Worldwide Express Operations, LLC

  Transportation services                

Second Lien Debt (j)

    (L + 8.00%) / (1.00%)     9.00%/0.00%       2/27/2017       2/3/2025       20,000       19,778       19,703    

Common Equity (2,000 units) (h)(j)

          2/27/2017           1,478       1,853    
             

 

 

   

 

 

   
                21,256       21,556       6
             

 

 

   

 

 

   

Total Non-control/Non-affiliate Investments

              $ 644,455     $  613,564       158
             

 

 

   

 

 

   

Total Investments

              $  716,419     $ 715,405       184
             

 

 

   

 

 

   

 

 

(a)

See Note 3 to the consolidated financial statements for portfolio composition by geographic location.

(b)

Equity ownership may be held in shares or units of companies related to the portfolio companies.

(c)

All debt investments are income producing, unless otherwise indicated. Equity investments are non-income producing unless otherwise noted.

(d)

Variable rate investments bear interest at a rate indexed to LIBOR (L), which is reset monthly, bimonthly, quarterly, or semi-annually. Certain variable rate investments also include a LIBOR interest rate floor. For each investment, the Company has provided the spread over the reference rate and the LIBOR floor, if any, as of September 30, 2020.

(e)

Rate includes the cash interest or dividend rate and paid-in-kind interest or dividend rate, if any, as of September 30, 2020. Generally, payment-in-kind interest can be paid-in-kind or all in cash.

(f)

Investment date represents the date of the initial investment in the security.

(g)

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.

(h)

Investment is held by a Taxable Subsidiary of the Company.

(i)

The disclosed commitment represents the unfunded amount as of September 30, 2020. The Company is earning 0.50% interest on the unfunded balance of the commitment. The interest rate disclosed represents the rate which will be earned if the commitment is funded.

 

10


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Schedule of Investments (unaudited)

September 30, 2020

(in thousands, except shares)

 

(j)

Investment pledged as collateral for the Credit Facility and, as a result, is not directly available to the creditors of the Company to satisfy any obligations of the Company other than the Company’s obligations under the Credit Facility (see Note 6 to the consolidated financial statements).

(k)

The portion of the investment not held by the Funds is pledged as collateral for the Credit Facility and, as a result, is not directly available to the creditors of the Company to satisfy any obligations of the Company other than the Company’s obligations under the Credit Facility (see Note 6 to the consolidated financial statements).

(l)

As defined in the 1940 Act, the Company is deemed to be an “Affiliated Person” of this portfolio company because it owns 5% or more of the portfolio company’s outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company. Transactions in which the issuer was an Affiliated Person are detailed in Note 3 to the consolidated financial statements.

(m)

Warrants entitle the Company to purchase a predetermined number of shares or units of common equity, and are non-income producing. The purchase price and number of shares are subject to adjustment under certain conditions until the expiration date, if any.

(n)

Investment in portfolio company that has sold its operations and is in the process of winding down.

(o)

Income producing. Maturity date, if any, represents mandatory redemption date.

(p)

Investment was on non-accrual status as of September 30, 2020, meaning the Company has ceased recognizing interest income on the investment.

(q)

Warrant entitles the Company to purchase 9.59% of the outstanding principal of Junior Subordinated Notes prior to exercise, and is non-income producing.

(r)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 6.03% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(s)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.79% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(t)

As defined in the 1940 Act, the Company is deemed to be both an “Affiliated Person” of and “Control” this portfolio company because it owns 25% or more of the portfolio company’s outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company. Transactions in which the issuer was both an Affiliated Person and a portfolio company that the Company is deemed to Control are detailed in Note 3 to the consolidated financial statements.

(u)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 4.50% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(v)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 4.97% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(w)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.35% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(x)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.69% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(y)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.97% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(z)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 4.50% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(aa)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.87% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(ab)

In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 3.10% on its “last out” tranche of the portfolio company’s senior term debt, which was previously syndicated into “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(ac)

The disclosed commitment represents the unfunded amount as of September 30, 2020. The Company is earning 1.00% interest on the unfunded balance of the commitment. The interest rate disclosed represents the rate earned on the outstanding, funded balance of the commitment.

See Notes to Consolidated Financial Statements (unaudited).

 

11


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Schedule of Investments

December 31, 2019

(in thousands, except shares)

 

Portfolio Company (a)(b)

Investment Type (c)

 

Industry

 

Variable Index
Spread / Floor (d)

 

Rate (e)
Cash/PIK

 

Investment
Date (f)

 

Maturity

  Principal
Amount
    Cost     Fair
Value (g)
    Percent of
Net Assets
 

Control Investments (t)

                 

FDS Avionics Corp. (dba Flight Display Systems)

 

Aerospace & Defense Manufacturing

             

Second Lien Debt

      6.00%/9.00%   11/5/2014   12/31/2021   $ 4,420     $ 4,418     $ 4,277    

Revolving Loan ($30 commitment)

      6.00%/9.00%   4/12/2018   12/31/2021     261       261       261    

Common Equity (7,478 shares) (j)

        11/10/2017         748       —      

Preferred Equity (2,550 shares)

        12/26/2019         2,550       915    
             

 

 

   

 

 

   
                7,977       5,403       1

US GreenFiber, LLC

 

Building Products Manufacturing

             

Second Lien Debt (k)

      7.00%/6.00%   7/3/2014   8/30/2024     14,498       14,494       11,757    

Second Lien Debt (k)

      7.50%/7.50%   11/9/2018   8/30/2024     4,660       4,660       4,660    

Common Equity (2,522 units) (h)(j)

        7/3/2014         586       —      

Common Equity (425,508 units) (j)

        8/30/2019         1       —      
             

 

 

   

 

 

   
                19,741       16,417       4
             

 

 

   

 

 

   

Total Control Investments

              $ 27,718     $ 21,820       5
             

 

 

   

 

 

   

Affiliate Investments (l)

                 

FAR Research Inc. (n)

 

Specialty Chemicals

               

Common Equity (1,396 units)

        3/31/2014       $ —       $ 28       0

Fiber Materials, Inc.

 

Aerospace & Defense Manufacturing

             

Common Equity (10 units)

        11/30/2016         645       10,449       3

Medsurant Holdings, LLC

 

Healthcare Services

               

Second Lien Debt

      13.00%/0.00%   12/18/2015   6/30/2020     8,823       8,814       8,823    

Preferred Equity (126,662 units) (h)

        4/12/2011         1,346       1,780    

Warrant (505,176 units) (h)(m)

        4/12/2011         4,516       6,377    
             

 

 

   

 

 

   
                14,676       16,980       4

Microbiology Research Associates, Inc.

 

Healthcare Services

               

Subordinated Debt

      11.00%/1.50%   5/13/2015   3/13/2022     8,930       8,921       8,930    

Common Equity (1,625,731 units) (j)

        5/13/2015         1,939       2,681    
             

 

 

   

 

 

   
                10,860       11,611       3

Mirage Trailers LLC

 

Utility Equipment Manufacturing

             

Second Lien Debt (k)

    (L + 8.50%) / (1.00%)   10.20%/4.50%   11/25/2015   11/25/2020     6,250       6,253       6,250    

Common Equity (2,500,000 shares) (o)

        11/25/2015         2,184       968    
             

 

 

   

 

 

   
                8,437       7,218       2

Pfanstiehl, Inc.

 

Healthcare Products

               

Subordinated Debt

      10.50%/0.00%   3/29/2013   9/29/2022     6,208       6,201       6,208    

Common Equity (8,500 units) (j)

        3/29/2013         850       26,614    
             

 

 

   

 

 

   
                7,051       32,822       8

Pinnergy, Ltd.

 

Oil & Gas Services

               

Common Equity - Class A-2 (42,500 units) (k)

        10/13/2016         3,000       29,831    

Common Equity - Class B (1,000 units) (k)

        10/13/2016         3,000       3,147    
             

 

 

   

 

 

   
                6,000       32,978       8

Steward Holding LLC (dba Steward Advanced Materials)

 

Aerospace & Defense Manufacturing

             

Second Lien Debt

      12.00%/1.50%   11/12/2015   5/12/2021     7,667       7,659       7,667    

Common Equity (1,000,000 units)

        11/12/2015         1,000       1,802    
             

 

 

   

 

 

   
                8,659       9,469       2
             

 

 

   

 

 

   

Total Affiliate Investments

              $ 56,328     $ 121,555       30
             

 

 

   

 

 

   

 

12


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Schedule of Investments

December 31, 2019

(in thousands, except shares)

 

Portfolio Company (a)(b)

Investment Type (c)

 

Industry

 

Variable Index
Spread / Floor (d)

 

Rate (e)
Cash/PIK

 

Investment
Date (f)

 

Maturity

  Principal
Amount
    Cost     Fair
Value (g)
    Percent of
Net Assets
 

Non-control/Non-affiliate Investments

                 

Accent Food Services, LLC

  Vending Equipment Manufacturing                

Second Lien Debt (k)(p)

      10.00%/5.00%   11/30/2016   5/30/2022   $ 33,842     $ 33,760     $ 31,626    

Subordinated Debt (j)(p)

      000%/17.00%   6/28/2019   5/30/2022     1,567       1,567       1,441    

Common Equity (7,885 units) (h)(j)

        11/30/2016         800       227    
             

 

 

   

 

 

   
                36,127       33,294       8

Allied 100 Group, Inc.

  Healthcare Products                

Subordinated Debt (k)

      11.25%/0.00%   7/31/2019   5/26/2023     21,500       21,405       21,405    

Common Equity (1,250,000 units) (j)

        11/26/2014         1,250       1,465    
             

 

 

   

 

 

   
                22,655       22,870       6

Alzheimer’s Research and Treatment Center, LLC

  Healthcare Services                

First Lien Debt (j)(w)

    (L + 5.75%) / (2.00%)   7.75%/0.00%   10/23/2018   10/23/2023     6,500       6,461       6,500    

Common Equity (1,000 units) (h)(j)

        10/23/2018         1,000       1,406    
             

 

 

   

 

 

   
                7,461       7,906       2

American AllWaste LLC (dba WasteWater Transport Services)

  Environmental Industries                

Second Lien Debt (j)

    (L + 11.00%) / (2.00%)   13.00%/0.00%   5/31/2018   11/30/2023     17,503       17,411       17,503    

Preferred Equity (500 units) (h)(j)

        5/31/2018         500       540    

Preferred Equity (207 units) (h)(j)

        8/6/2019         250       250    
             

 

 

   

 

 

   
                18,161       18,293       4

Argo Turboserve Corporation

  Business Services                

Second Lien Debt (j)

    (L + 9.75%) / (2.00%)   11.84%/0.00%   12/26/2018   6/28/2023     14,156       14,098       14,156       3

AVC Investors, LLC (dba Auveco)

  Specialty Distribution                

Second Lien Debt (k)

      11.50%/0.00%.   1/3/2018   7/3/2023     22,500       22,427       22,500    

Common Equity (5,000 units) (j)

        1/3/2018         490       776    
             

 

 

   

 

 

   
                22,917       23,276       6

B&B Roadway and Security Solutions, LLC

  Component Manufacturing                

Second Lien Debt

      10.50%/3.50%   2/27/2018   8/27/2023     10,493       10,456       9,569    

Common Equity (50,000 units) (h)(j)

        2/27/2018         500       200    
             

 

 

   

 

 

   
                10,956       9,769       2

Bandon Fitness (Texas), Inc.

  Retail                

First Lien Debt (j)(z)

    (L + 6.00%) / (2.25%)   8.25%/0.00%   8/9/2019   8/9/2024     13,250       12,785       12,785    

Common Equity (497,549 units) (j)

        8/9/2019         849       849    
             

 

 

   

 

 

   
                13,634       13,634       3

BCC Group Holdings, Inc.

  Information Technology Services                

Subordinated Debt

      11.00%/1.00%   1/28/2019   4/11/2023     18,167       18,027       18,167    

Common Equity(451 shares)

        1/28/2019         232       167    

Preferred Equity (14 shares)

        1/28/2019         143       143    
             

 

 

   

 

 

   
                18,402       18,477       4

BCM One Group Holdings, Inc.

  Information Technology Services                

Subordinated Debt (k)

      11.00%/0.00%   1/3/2019   7/3/2024     27,000       26,888       27,000    

Common Equity (2,286 shares)

        1/3/2019         2       332    

Preferred Equity (133 shares)

        1/3/2019         1,330       1,330    
             

 

 

   

 

 

   
                28,220       28,662       7

Bedford Precision Parts LLC

  Specialty Distribution                

First Lien Debt (j)(s)

    (L + 6.25%) / (2.00%)   8.25%/0.00%   3/12/2019   3/12/2024     5,000       4,969       5,000    

Common Equity (500,000 units)(h)(j)

        3/12/2019         500       445    
             

 

 

   

 

 

   
                5,469       5,445       1

Cardboard Box LLC (dba Anthony’s Coal Fired Pizza)

  Restaurants                

Common Equity (521,021 units) (j)

        12/15/2015         521       113    

Preferred Equity (99,889 units)(j)

        12/6/2019         49       146    
             

 

 

   

 

 

   
                570       259       0

Control Scan, Inc.

  Information Technology Services                

Subordinated Debt (j)

      11.00%/0.00%   7/28/2017   1/28/2023     6,750       6,731       6,750    

Common Equity (3,704 shares)(j)

        7/28/2017         4       624    

Preferred Equity (100 shares) (j)

        7/28/2017         996       996    
             

 

 

   

 

 

   
                7,731       8,370       2

CRS Solutions Holdings, LLC (dba CRS Texas)

  Business Services                

Second Lien Debt

      10.50%/1.00%   3/14/2018   9/14/2023     9,166       9,136       9,166    

Common Equity (750,000 units) (h)(j)

        3/14/2018         750       822    
             

 

 

   

 

 

   
                9,886       9,988       2

Diversified Search LLC

  Business Services                

First Lien Debt (k)(r)

    (L + 5.75%) / (1.75%)   7.69%/0.00%   2/7/2019   2/7/2024     15,155       14,939       15,155    

Common Equity (573 units) (h)(j)

        2/7/2019         593       724    
             

 

 

   

 

 

   
                15,532       15,879       4

EBL, LLC (EbLens)

  Retail                

Second Lien Debt (j)

      12.00%/1.00%   7/13/2017   1/13/2023     9,484       9,433       9,484    

Common Equity (75,000 units) (j)

        7/13/2017         750       669    
             

 

 

   

 

 

   
                10,183       10,153       3

 

13


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Schedule of Investments

December 31, 2019

(in thousands, except shares)

 

Portfolio Company (a)(b)

Investment Type (c)

 

Industry

 

Variable Index
Spread / Floor (d)

 

Rate (e)
Cash/PIK

 

Investment
Date (f)

 

Maturity

  Principal
Amount
    Cost     Fair
Value (g)
    Percent of
Net Assets
 

French Transit, LLC

 

Consumer Products

             

First Lien Debt (j)

    (L + 9.00%) / (2.25%)   11.25%/0.00%   6/21/2019   6/21/2024   $ 8,000     $ 7,964     $ 8,000    

Revolving Loan ($1,000 commitment) (j)(u)

    (L + 9.00%) / (2.25%)   11.25%/0.00%   6/21/2019   6/21/2024     —         (4     —      
             

 

 

   

 

 

   
                7,960       8,000       2

Global Plasma Solutions, Inc.

 

Component Manufacturing

             

First Lien Debt (j)(v)

    (L + 5.00%) / (2.00%)   7.10%/0.00%   9/21/2018   9/21/2023     7,071       7,013       7,071    

Preferred Equity (947 shares) (j)

        9/21/2018         360       399    

Common Equity (947 shares) (j)

        9/21/2018         15       161    
             

 

 

   

 

 

   
                7,388       7,631       2

Gurobi Optimization, LLC

 

Information Technology Services

             

Common Equity (5 shares)

        12/19/2017         1,500       3,382       1

Haematologic Technologies, Inc.

  Healthcare Services                

First Lien Debt (x)

    (L + 7.25%) / (2.00%)   9.25%/0.00%   10/11/2019   10/11/2024     5,500       5,461       5,461    

Common Equity (500 units) (j)

        10/11/2019         500       500    
             

 

 

   

 

 

   
                5,961       5,961       1

Hilco Plastics Holdings, LLC (dba Hilco Technologies)

 

Component Manufacturing

             

Second Lien Debt

      11.50%/1.50%   9/23/2016   12/31/2019     10,116       10,116       9,057    

Revolving Loan (j)

    (L + 6.50%) / (0.00%)   8.26%/0.00%   12/20/2019   12/15/2019     5,962       5,962       5,962    

First Lien Debt (j)

    (L + 6.95%) / (0.00%)   8.66%/0.00%   12/20/2019   12/15/2019     4,812       4,812       4,812    

First Lien Debt (j)

    (L + 6.95%) / (0.00%)   8.64%/0.00%   12/20/2019   12/15/2019     1,815       1,815       1,815    

Preferred Equity (1,000,000 units) (h)(j)

        4/18/2018         1,000       —      

Common Equity (72,507 units) (h)(j)

        9/23/2016         473       —      
             

 

 

   

 

 

   
                24,178       21,646       5

Hoonuit, LLC

 

Information Technology Services

             

First Lien Debt

    (L + 9.25%) / (2.25%)   11.50%/0.00%   6/7/2019   6/7/2024     7,165       7,121       7,165    

Preferred Equity (610 units) (h)(j)

        6/20/2019   1/1/2022       250       279    
             

 

 

   

 

 

   
                7,371       7,444       2

Hub Acquisition Sub, LLC (dba Hub Pen)

 

Promotional products

             

Second Lien Debt (k)

      12.25%/0.00%   3/23/2016   9/23/2021     25,000       24,947       25,000    

Common Equity (7,500 units)

        3/23/2016         263       1,488    
             

 

 

   

 

 

   
                25,210       26,488       6

Hunter Defense Technologies Inc.

  Aerospace & Defense Manufacturing                

First Lien Debt (j)

    (L + 7.00%) / (1.00%)   8.94%/0.00%   9/27/2018   3/29/2023     9,246       9,174       9,246       2

IBH Holdings, LLC (fka Inflexxion, Inc.)

 

Business Services

             

Common Equity (150,000 units)

        6/20/2018         —         —         0
K2 Merger Agreement Agent, LLC (fka K2 Industrial Services, Inc.) (n)  

Industrial Cleaning & Coatings

             

Second Lien Debt

      0.00%/10.00%   1/28/2019   1/28/2021     2,309       2,309       2,309       1

The Kyjen Company, LLC (dba Outward Hound)

 

Consumer Products

             

Second Lien Debt (k)

      12.00%/0.00%   12/8/2017   6/8/2024     15,000       14,948       13,024    

Common Equity (765 shares) (j)

        12/8/2017         765       609    
             

 

 

   

 

 

   
                15,713       13,633       3

LNG Indy, LLC (dba Kinetrex Energy)

 

Oil & Gas Distribution

             

Second Lien Debt (k)

      11.50%/0.00%   12/28/2016   11/12/2021     5,000       4,991       5,000    

Common Equity (1,000 units)

        12/28/2016         1,000       1,264    
             

 

 

   

 

 

   
                5,991       6,264       2

Marco Group International OpCo, LLC

 

Industrial Cleaning & Coatings

             

Second Lien Debt

      10.50%/0.75%   7/21/2017   1/21/2023     12,225       12,192       12,120    

Common Equity (960,482 units) (h)(j)

        7/21/2017         960       1,063    
             

 

 

   

 

 

   
                13,152       13,183       3

Mesa Line Services, LLC

 

Utilities: Services

             

Second Lien Debt (j)

      10.50%/1.75%   11/30/2017   8/1/2024     17,221       17,133       17,221    

Common Equity (981 shares) (j)

        11/30/2017         1,148       961    
             

 

 

   

 

 

   
                18,281       18,182       4

Midwest Transit Equipment, Inc.

 

Transportation services

             

Warrant (14,384 shares) (j)(m)

        6/23/2017         361       1,244    

Warrant (9.59% of Junior Subordinated Notes) (j)(q)

        6/23/2017         381       467    
             

 

 

   

 

 

   
                742       1,711       0

NGT Acquisition Holdings, LLC (dba Techniks Industries)

 

Component Manufacturing

             

Common Equity (378 units) (j)

        5/24/2017         500       155       0

OMC Investors, LLC (dba Ohio Medical Corporation)

 

Healthcare Products

             

Second Lien Debt

      12.00%/0.00%   1/15/2016   7/15/2021     10,000       9,972       10,000    

Common Equity (5,000 units)

        1/15/2016         500       475    
             

 

 

   

 

 

   
                10,472       10,475       3

 

14


Table of Contents

FIDUS INVESTMENT CORPORATION

Consolidated Schedule of Investments

December 31, 2019

(in thousands, except shares)

 

Portfolio Company (a)(b)

Investment Type (c)

 

Industry

 

Variable Index
Spread / Floor (d)

 

Rate (e)
Cash/PIK

 

Investment
Date (f)

 

Maturity

  Principal
Amount
    Cost     Fair
Value (g)
    Percent of
Net Assets
 

Palisade Company, LLC

  Information Technology Services                

Subordinated Debt (j)

      11.75%/0.00%   11/15/2018   5/15/2024   $ 6,500     $ 6,474     $ 6,500    

Common Equity (100 shares) (j)

        11/15/2018         1,000       901    
             

 

 

   

 

 

   
                7,474       7,401       2

Palmetto Moon, LLC

  Retail                

First Lien Debt

      11.50%/2.50%   11/3/2016   10/31/2021     4,963       4,949       4,963    

Common Equity (499 units) (j)

        11/3/2016         494       67    
             

 

 

   

 

 

   
                5,443       5,030       1

Power Grid Components, Inc.

  Specialty Distribution                

Second Lien Debt (k)

      11.00%/1.00%   4/12/2018   12/2/2025     22,207       22,115       22,207    

Preferred Equity (392 shares) (j)

        4/12/2018         392       459    

Preferred Equity (48 shares) (j)

        12/2/2019         48       57    

Common Equity (10,622 shares) (j)

        4/12/2018         462       610    
             

 

 

   

 

 

   
                23,017       23,333       6

Prime AE Group, Inc.

  Business Services                

First Lien Debt (j)

    (L + 6.25%) / (2.00%)   8.25%/0.00%   11/25/2019   11/25/2024     7,500       7,312       7,312    

Preferred Equity (500,000 shares) (j)

        11/25/2019         500       500    
             

 

 

   

 

 

   
                7,812       7,812       2

Pugh Lubricants, LLC

  Specialty Distribution                

Second Lien Debt (k)

      12.25%/0.00%   11/10/2016   5/10/2022     23,581       23,521       23,581    

Common Equity (6,125 units) (h)(j)

        11/10/2016         576       1,199    
             

 

 

   

 

 

   
                24,097       24,780       6

Revenue Management Solutions, LLC

  Information Technology Services                

Common Equity (2,250,000 shares)

        1/4/2017         2,250       5,120       1

Rhino Assembly Company, LLC

  Specialty Distribution                

Second Lien Debt (k)

      12.00%/1.00%   8/11/2017   2/11/2023     11,440       11,402       10,101    

Delayed Draw Commitment ($875 commitment) (i)(j)

      12.00%/1.00%   8/11/2017   5/17/2022     —         —         —      

Preferred Equity (8,864 units) (h)(j)

        8/11/2017         944       499    
             

 

 

   

 

 

   
                12,346       10,600       3

Road Safety Services, Inc.

  Business Services                

Second Lien Debt

      11.25%/1.50%   9/18/2018   3/18/2024     10,222       10,185       10,222    

Common Equity (655 units)

        9/18/2018         621       680    
             

 

 

   

 

 

   
                10,806       10,902       3

Rohrer Corporation

  Packaging                

Subordinated Debt (j)

      10.50%/1.00%   10/1/2018   4/1/2024     13,875       13,822       13,875    

Common Equity (400 shares)

        7/18/2016         780       1,256    
             

 

 

   

 

 

   
                14,602       15,131       4

SES Investors, LLC (dba SES Foam)

  Building Products Manufacturing                

Second Lien Debt

      13.00%/0.00%   9/8/2016   12/29/2020     3,095       3,082       3,095    

Common Equity (6,000 units) (h)(j)

        9/8/2016         567       856    
             

 

 

   

 

 

   
                3,649       3,951       1

Software Technology, LLC

  Information Technology Services                

Subordinated Debt (k)

      11.00%/0.00%   12/23/2016   6/23/2023     10,000       9,972       10,000    

Common Equity (12 shares)

        12/23/2016         1,291       1,578    
             

 

 

   

 

 

   
                11,263       11,578       3

Specialized Elevator Services Holdings, LLC

  Business Services                

First Lien Debt (j)(y)

    (L + 5.25%) / (2.00%)   7.25%/0.00%   5/7/2019   5/3/2024     7,080       6,985       7,080    

Common Equity (500 units) (j)

        5/8/2019         500       554    
             

 

 

   

 

 

   
                7,485       7,634       2

SpendMend LLC

  Business Services                

Second Lien Debt (k)

      11.00%/1.00%   1/8/2018   7/8/2023     10,491       10,456       10,491    

Common Equity (1,000,000 units)

        1/8/2018         1,000       1,400    
             

 

 

   

 

 

   
                11,456       11,891       3

TransGo, LLC

  Component Manufacturing                

Common Equity (1,000 units)

        2/28/2017         998       1,005       0

The Tranzonic Companies

  Specialty Distribution                

Subordinated Debt (j)