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Item 9A. Controls and Procedures

2020-11-10 compared with 2019-11-13 · 115 added, 123 removed, 230 unchanged (51% of the section changed)

11 unchanged sentences

c) Attestation Report of the Registered Public Accounting Firm

Refer to the Report of Independent Registered Public Accounting Firm located in Item 8 of this Form 10-K.

d) Change in Internal Control over Financial Reporting

were no changes in internal controls for the three months ended September 30, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Not Applicable.

d) Change in Internal Control over Financial

There were no changes in internal controls for the three months ended September 30, 2020 that have materially affected, or are reasonably

likely to materially affect, our internal control over financial reporting.

OTHER INFORMATION

Not applicable.

We will file a definitive Proxy Statement for our 2021 Annual Meeting of Stockholders (the 2021 Proxy Statement) with the SEC, pursuant to

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Accordingly, certain information required by Part III has been omitted under General Instruction G(3) to Form 10-K.

Only those sections of the 2020 Proxy

Statement that specifically address the items set forth herein are incorporated herein by reference.

Only those sections of the 2021 Proxy Statement that specifically address the items set forth herein are incorporated herein by reference.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by Item 10 is hereby incorporated by reference from our 2021 Proxy Statement under the caption Election of Directors.

We have adopted a Code of Business Conduct and Ethics (the Code of Conduct) that applies to all of our officers and directors and to the

employees of our Adviser and our Administrator.

The Code of Conduct is available in the Investor Relations section of our website at www.gladstonecapital.com .

We have adopted a Code of Business Conduct and Ethics (the Code of Conduct) that applies to all of our officers and directors and to the employees

of our Adviser and our Administrator.

The Code of Conduct is available in the Investors section of our website under Governance Governance Documents at www.gladstonecapital.com .

EXECUTIVE COMPENSATION

The information required by Item 11 is hereby incorporated by reference from our 2020 Proxy Statement under the captions Executive

Compensation and Director Compensation for Fiscal Year 2019.

The information required by Item 11 is hereby incorporated by reference from our 2021 Proxy Statement under the captions Executive Compensation and

Director Compensation for Fiscal Year 2020.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by Item 13 is hereby incorporated by reference from our 2020 Proxy Statement under the captions Certain Transactions

and Information Regarding our Board of Directors and Corporate GovernanceDirector Independence.

The information required by Item 13 is hereby incorporated by reference from our 2021 Proxy Statement under the captions Certain Transactions and

Information Regarding our Board of Directors and Corporate GovernanceDirector Independence.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by Item 14 is hereby incorporated by reference from our 2020 Proxy Statement under the caption Independent Registered

Public Accounting Firm Fees.

The information required by Item 14 is hereby incorporated by reference from our 2021 Proxy Statement under the caption Independent Registered Public

Accounting Firm Fees.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

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The following exhibits are filed as part of this report or are hereby incorporated by reference to exhibits previously filed with the SEC:

Articles of Amendment and Restatement to the Articles of Incorporation, incorporated by reference to Exhibit

99.a.2 to Pre-Effective Amendment No.

Articles of Amendment and Restatement to the Articles of Incorporation, incorporated by reference to Exhibit 99.a.2 to Pre-Effective Amendment No.

1 to the Registration Statement on Form N-2 (File No.

333-63700), filed July 27, 2001.

Articles Supplementary Establishing and Fixing the Rights and Preferences of Term Preferred Shares, including Appendix

A thereto relating to the Term Preferred Shares, 7.125% Series 2016, incorporated by reference to Exhibit 2.a.2 to Post-Effective Amendment No.

5 to the Registration Statement on Form N-2 (File No.

Supplementary Establishing and Fixing the Rights and Preferences of Term Preferred Shares, including Appendix A thereto relating to the Term Preferred Shares, 7.125% Series

2016, incorporated by reference to Exhibit 2.a.2 to Post-Effective Amendment No.

5 to the Registration Statement on Form

N-2 (File No.

333-162592), filed October 31, 2011.

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814-00237), filed October 29, 2015.

Articles Supplementary, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (File No.

Articles Supplementary, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (File

814-00237), filed September 21, 2017.

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6.00% Series 2024 Term Preferred Stock, incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K (File No.

814-00237), filed September 21, 2017.

Bylaws, incorporated by reference to Exhibit 99.b to Pre-Effective Amendment No.

1 to the Registration Statement on Form

N-2 (File No.

814-00237), filed

September 21, 2017.

Bylaws, incorporated by reference to Exhibit

99.b to Pre-Effective Amendment No.

1 to the Registration Statement on Form N-2 (File No.

333-63700), filed July 27, 2001.

Amendment to Bylaws, incorporated by reference to Exhibit 3.3 to the Quarterly Report on Form 10-Q (File No.

Amendment to Bylaws, incorporated by reference to Exhibit 3.3 to the Quarterly Report on Form 10-Q (File

814-00237), filed February 17, 2004.

Second Amendment to Bylaws, incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K (File No.

Second Amendment to Bylaws, incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K

814-00237), filed July 10, 2007.

Third Amendment to Bylaws, incorporated by reference to Exhibit 99.1 to the Current Report on Form

8-K (File No.

Third Amendment to Bylaws, incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K (File

814-00237), filed June 10, 2011.

Fourth Amendment to Bylaws, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (File No.

Fourth Amendment to Bylaws, incorporated by reference to Exhibit 3.1 to the Current Report on Form

8-K (File No.

814-00237), filed November 29, 2016.

Form of Certificate for Common Stock, incorporated by reference to Exhibit 99.d.2 to Pre-Effective Amendment No.

3 to the Registration Statement

on Form N-2 (File No.

Form of Certificate for Common Stock, incorporated by reference to Exhibit 99.d.2 to Pre-Effective Amendment

3 to the Registration Statement on Form N-2 (File No.

333-63700), filed August 23, 2001.

Form of Certificate for 6.00% Series 2024 Term Preferred Stock , incorporated by reference to Exhibit

4.1 to the Current Report on Form 8-K (File No.

814-00237), filed September 21, 2017.

Indenture between the Registrant and U.S.

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First Supplemental Indenture between the Registrant and U.S.

Bank National Association, dated as of November 6, 2018, incorporated by reference

to Exhibit 2.d.11 to Post-Effective Amendment No.

Bank National Association, dated as of November

6, 2018, incorporated by reference to Exhibit 2.d.11 to Post-Effective Amendment No.

7 to the Registration Statement on Form N-2 (File No.

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Description of Securities.

Stock Transfer Agency Agreement between the Registrant and The Bank of New York, incorporated by reference to Exhibit 99.k.1 to Pre-Effective

Amendment No.

Stock Transfer Agency Agreement between the Registrant and The Bank of New York, incorporated by reference to Exhibit 99.k.1 to Pre-Effective Amendment No.

1 to the Registration Statement on Form N-2 (File No.

333-63700), filed July 27, 2001.

Custody Agreement between the Registrant and The Bank of New York, dated as of May 5, 2006, incorporated by reference to Exhibit 10.3 to

the Quarterly Report on Form 10-Q (File No.

Custody Agreement between the Registrant and The Bank of New York, dated as of May

5, 2006, incorporated by reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q (File No.

814-00237), filed August 1, 2006.

Amended and Restated Investment Advisory and Management Agreement between the Registrant and Gladstone Management Corporation, dated as of

October 1, 2006, incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K (File No.

814-00237), filed October 5, 2006.

Amendment No.

1 to Amended and Restated Investment Advisory and Management Agreement between the Registrant and Gladstone Management Corporation, dated

as of October 13, 2015 incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File No.

814-00237), filed October 14, 2015.

Administration Agreement between the Registrant and Gladstone Administration, LLC, dated as of October 1, 2006, incorporated by reference

to Exhibit 99.2 to the Current Report on Form 8-K (File No.

Administration Agreement between the Registrant and Gladstone Administration, LLC, dated as of October

1, 2006, incorporated by reference to Exhibit 99.2 to the Current Report on Form 8-K (File No.

814-00237), filed October 5, 2006.

Fifth Amended and Restated Credit Agreement, dated as of May 1, 2015, by and among Gladstone Business Loan, LLC, as Borrower, Gladstone Management

Corporation, as Servicer, the Lenders and Managing Agents named therein, and Keybank National Association, as Administrative Agent, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File No.

Fifth Amended and Restated Credit Agreement, dated as of May

1, 2015, by and among Gladstone Business Loan, LLC, as Borrower, Gladstone Management Corporation, as Servicer, the Lenders and Managing Agents named therein, and Keybank National Association, as Administrative Agent, incorporated by reference to Exhibit

10.1 to the Current Report on Form 8-K (File No.

814-00237), filed May 5, 2015.

Amendment No.

1 to Fifth Amended and Restated Credit Agreement, dated as of October 9, 2015, by and among Gladstone Business Loan, LLC, as Borrower,

Gladstone Management Corporation, as Servicer, Keybank National Association, Alostar Bank of Commerce, ING Capital LLC, Newbridge Bank, Santander Bank, N.A.

and Talmer Bank and Trust, collectively as Lenders, incorporated by reference to Exhibit

10.2 to the Quarterly Report on Form 10-Q (File No.

1 to Fifth Amended and Restated Credit Agreement, dated as of October

9, 2015, by and among Gladstone Business Loan, LLC, as Borrower, Gladstone Management Corporation, as Servicer, Keybank National Association, Alostar Bank of Commerce, ING Capital LLC, Newbridge Bank, Santander Bank, N.A.

and Talmer Bank and Trust, collectively

as Lenders, incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q (File No.

814-00237), filed February 8,

Amendment No.

2 to Fifth Amended and Restated Credit Agreement, dated as of August 18, 2016, by and among Gladstone Business Loan, LLC, as

Borrower, Gladstone Management Corporation, as Servicer, Keybank National Association, Alostar Bank of Commerce, ING Capital LLC, Newbridge Bank, Santander Bank, N.A.

and Talmer Bank and Trust, collectively as Lenders, incorporated by reference to

Exhibit 99.2.K.8 to Post-Effective Amendment No.

1 to the Registration Statement on Form N-2 (File No.

2 to Fifth Amended and Restated Credit Agreement, dated as of August

18, 2016, by and among Gladstone Business Loan, LLC, as Borrower, Gladstone Management Corporation, as Servicer, Keybank National Association, Alostar Bank of Commerce, ING Capital LLC, Newbridge Bank, Santander Bank, N.A.

and Talmer Bank and Trust, collectively

as Lenders, incorporated by reference to Exhibit 99.2.K.8 to Post-Effective Amendment No.

1 to the Registration Statement on Form N-2 (File

333-208637), filed October 28, 2016.

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incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File No.

814-00237), filed August 29, 2017.

814-00237), filed

August 29, 2017.

Amendment No.

4 to Fifth Amended and Restated Credit Agreement, dated as of March 9, 2018, by and among Gladstone Business Loan, LLC, as Borrower,

Gladstone Management Corporation, as Servicer, KeyBank National Association, as administrative agent, swingline lender, managing agent and lead arranger and certain other lenders party thereto, incorporated by reference to Exhibit 10.1 to the

Current Report on Form 8-K (File No.

4 to Fifth Amended and Restated Credit Agreement, dated as of March

9, 2018, by and among Gladstone Business Loan, LLC, as Borrower, Gladstone Management Corporation, as Servicer, KeyBank National Association, as administrative agent, swingline lender, managing agent and lead arranger and certain other lenders party thereto,

incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File No.

814-00237), filed March 12, 2018.

Joinder Agreement, dated as of June 19, 2015, by and among Gladstone Business Loan, LLC, Gladstone Management Corporation, Keybank National Association

and Santander Bank, N.A., incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File No.

Joinder Agreement, dated as of June

19, 2015, by and among Gladstone Business Loan, LLC, Gladstone Management Corporation, Keybank National Association and Santander Bank, N.A., incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File

814-00237), filed June 23, 2015.

Assignment, Acceptance and Joinder, dated as of June 19, 2015, by and between Keybank National Association and Alostar Bank of Commerce, incorporated

by reference to Exhibit 10.2 to the Current Report on Form 8-K (File No.

Assignment, Acceptance and Joinder, dated as of June

19, 2015, by and between Keybank National Association and Alostar Bank of Commerce, incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K (File No.

filed June 23, 2015.

Assignment and Acceptance, dated as of June 19, 2015, by and between Keybank National Association and Newbridge Bank, incorporated by reference

to Exhibit 10.3 to the Current Report on Form 8-K (File No.

Assignment and Acceptance, dated as of June

19, 2015, by and between Keybank National Association and Newbridge Bank, incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K (File No.

814-00237), filed June 23, 2015 .

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1 to Custodial Agreement, incorporated by reference to Exhibit 2.j.3 to Post-Effective Amendment No.

1 to the Registration Statement

on Form N-2 (File No.

1 to the Registration Statement on Form N-2 (File No.

333-185191), filed December 23, 2013.

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2 to Custodial Agreement, incorporated by reference to Exhibit 2.j.4 to Post-Effective Amendment No.

1 to the Registration Statement

on Form N-2 (File No.

1 to the Registration Statement on Form N-2 (File No.

333-185191), filed December 23, 2013.

Amendment No.

5 to Fifth Amended and Restated Credit Agreement, dated as of July 10, 2019 by and among Gladstone Business Loan, LLC, as Borrower,

Current Report on Form 8-K (File No.

5 to Fifth Amended and Restated Credit Agreement, dated as of July 10, 2019 by and among Gladstone Business Loan, LLC, as Borrower, Gladstone Management Corporation, as Servicer, KeyBank National Association, as administrative agent, swingline lender, managing

agent and lead arranger and certain other lenders party thereto, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File

814-00237), filed July 10, 2019 .

Code of Ethics and Business Conduct.

Second Amended and Restated Investment Advisory and Management Agreement between the Registrant and Gladstone Management Corporation, dated as

of April 14, 2020, incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q (File No.

814-00237), filed on May 4,

Amendment No.

6 to Fifth Amended and Restated Credit Agreement, dated as of April

29, 2020 by and among Gladstone Business Loan, LLC, as Borrower, Gladstone Management Corporation, as Servicer, KeyBank National Association, as administrative agent, swingline lender, managing agent and lead arranger and certain other lenders party thereto,

incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q (File No.

814-00237), filed on May 4, 2020.

Subsidiaries of the Registrant.

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September 30,

AFFILIATE INVESTMENTS14.2%

INVESTMENTS 14.2%

Secured First Lien Debt3.7%

Diversified/Conglomerate Manufacturing3.7%

Edge Adhesives Holdings, Inc.Term Debt (L + 10.5%, 12.5% Cash, Due 2/2022)

Edge Adhesives Holdings, Inc.Term Debt (L + 11.8%, 13.8% Cash, Due 2/2022)

LWO Acquisitions Company LLCLine of

LWO Acquisitions Company LLCTerm

Edge Adhesives Holdings, Inc.

Credit, $0 available (L + 8.0%, 10.0% Cash, Due 12/2020)

Edge Adhesives Holdings, Inc.

(L + 10.5%, 12.5% Cash, Due 2/2022)

Edge Adhesives Holdings, Inc.

(L + 11.8%, 13.8% Cash, Due 2/2022)

Total Secured First Lien Debt

Secured Second Lien Debt8.7%

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Lignetics, Inc.Term Debt (L + 9.0%, 12.0% Cash, Due 5/2025)

Personal and Non-Durable Consumer Products (Manufacturing Only)1.5%

Canopy Safety Brands, LLC.

Term Debt (L + 10.5%, 12.5% Cash, Due 7/2022)

Lignetics, Inc.Term Debt (L + 9.0%, 12.0% Cash) (F)

Personal and Non-Durable Consumer Products

(Manufacturing Only)0.0%

Canopy Safety Brands, LLC.Term

Total Secured Second Lien Debt

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September 30,

Unsecured Debt0.0%

Diversified/Conglomerate Manufacturing0.0%

LWO Acquisitions Company LLCTerm Debt (Due 6/2020) (G)

Preferred Equity0.9%

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Lignetics, Inc.Preferred Stock

Personal and Non-Durable Consumer Products (Manufacturing Only)0.3%

Personal and Non-Durable Consumer Products

(Manufacturing Only) 0.2%

Canopy Safety Brands, LLCPreferred Stock

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Common Equity0.9%

Diversified/Conglomerate Manufacturing0.0%

LWO Acquistions Company LLCCommon

Diversified Natural Resources, Precious Metals and Minerals 0.9%

Lignetics, Inc.Common Stock

Personal and Non-Durable Consumer Products (Manufacturing Only)0.1%

Personal and Non-Durable Consumer Products

(Manufacturing Only) 0.0%

Canopy Safety Brands, LLCCommon Stock

Textiles and Leather0.0%

Targus Cayman HoldCo, Ltd.Common

Total Common Equity

TOTAL AFFILIATE INVESTMENTS

CONTROL INVESTMENTS 6.9%

Secured First Lien Debt 2.1%

Diversified/Conglomerate Manufacturing1.5%

LWO Acquisitions Company LLCTerm Debt (L + 7.5%, 10.0% Cash, Due 6/2021)

LWO Acquisitions Company LLCTerm Debt (Due 6/2021) (H)

Printing and Publishing0.6%

TNCP Intermediate HoldCo, LLCLine of Credit, $500 available

(8.0% Cash, Due 9/2021) (J)

Investment (A)(B)(I)(L)(M)

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September 30,

CONTROL INVESTMENTS8.7%

Secured First Lien Debt2.8%

Diversified/Conglomerate Manufacturing2.2%

LWO Acquisitions Company LLCTerm Debt (L + 7.5%, 10.0% Cash, Due 6/2021)

LWO Acquisitions Company LLCTerm Debt (Due 6/2021) (H)

Machinery0.0%

PIC 360, LLCTerm Debt (N)

Printing and Publishing0.6%

TNCP Intermediate HoldCo, LLCLine of Credit, $500 available (8.0% Cash, Due 9/2021) (J)

Total Secured First Lien Debt

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LWO Acquisitions Company LLCTerm Debt (Due 6/2023) (H)

Preferred Equity0.1%

Automobile0.1%

Defiance Integrated Technologies, Inc.Preferred Stock

Common Equity1.2%

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Diversified/Conglomerate Manufacturing0.0%

LWO Acquistions Company LLCCommon Units

LWO Acquisitions Company LLCCommon Units

Machinery1.0%

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Certain of the securities listed in this schedule are issued by affiliate(s) of the indicated portfolio company.

Common stock, warrants, options, membership units and, in some cases, preferred stock are generally non-income

producing and restricted.

Common stock, warrants, options, membership units and, in some cases, preferred stock are generally non-income producing and restricted.

Represents the total amount of interest, dividends and other income credited to investment income for the

portion of the fiscal year an investment was a control or affiliate investment, as appropriate.

Gross additions include increases in investments resulting from new portfolio investments, paid-in-kind interest

or dividends, the amortization of discounts and fees, and the exchange of one or more existing securities for one or more new securities.

Gross additions include increases in investments resulting from new portfolio investments, paid-in-kind interest or dividends, the amortization of discounts and fees, and the exchange of one or more existing securities for one or more new securities.

Gross reductions include decreases in investments resulting from principal collections related to investment

repayments or sales, the amortization of premiums and acquisition costs, and the exchange of one or more existing securities for one or more new securities.

Investment transferred from affiliate investments to non-control/non-affiliate investments during the three

months ended December 31, 2018.

Investment transferred from affiliate investments to control investments during the three months ended

March 31, 2019.

Investment was paid off at par during the year ended September 30, 2020.

Debt security does not have a stated interest rate that is payable thereon.

Interest rate percentages represent cash interest rates in effect at September 30, 2020, and due dates

represent the contractual maturity date.

Unless indicated otherwise, all cash interest rates are indexed to 30-day London Interbank Offered Rate (LIBOR), which was 2.02% as of September 30, 2019.

If applicable, paid-in-kind

(PIK) interest rates are noted separately from the cash interest rates and any unused line of credit fees are excluded.

represent the contractual maturity

Unless indicated otherwise, all cash interest rates are indexed to 30-day London Interbank Offered Rate (LIBOR), which was 0.15% as of

September 30, 2020.

If applicable, paid-in-kind (PIK) interest rates are noted separately from the cash interest rates and any unused line of credit

fees are excluded.

Debt security has a fixed interest rate.

2 unchanged sentences

Warrants are represented as a percentage of ownership, as applicable.

Unless indicated otherwise, all of our investments are valued using Level 3 inputs within the FASB Accounting

Standard Codification (ASC) Topic 820, Fair Value Measurements and Disclosures (ASC 820) fair value hierarchy.

Refer to Note 3 Investments in the accompanying Notes to Consolidated Financial Statements

for additional information.

Unless indicated otherwise, all of our investments are valued using Level 3 inputs within the FASB

Accounting Standard Codification (ASC) Topic 820, Fair Value Measurements and Disclosures (ASC 820) fair value hierarchy.

Refer to Note 3 Investments in the accompanying Notes to Consolidated Financial

Statements for additional information.

Category percentages represent the fair value of each category and subcategory as a percentage of net assets as

of September 30, 2020.

Investment was paid off at par during the three months ended September 30, 2019.

Information related to the amount of equity in the net profit and loss for the year for the investments listed

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures