11 unchanged sentences
31, 2020, 2019 and 2018
−Removed: Consolidated Schedule of Investments as of December 31, 2019 and
+Added: Consolidated Schedules of Investments as of December 31, 2020 and
Notes to Consolidated Financial Statements
−Removed: MANAGEMENTS REPORT ON INTERNAL
−Removed: CONTROL OVER FINANCIAL REPORTING
−Removed: Management is responsible for establishing and maintaining adequate internal control over financial
−Removed: reporting, and for performing an assessment of the effectiveness of internal control over financial reporting as of December 31, 2019.
−Removed: Internal control over financial reporting is a process designed to provide reasonable assurance regarding the
−Removed: reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
−Removed: The Companys internal control over financial reporting includes those policies
−Removed: and procedures that (i) pertain to assets of the Company;
−Removed: (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted
−Removed: accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company;
−Removed: and (iii) provide reasonable assurance regarding prevention or timely
−Removed: detection of unauthorized acquisition, use, or disposition of the Companys assets that could have a material effect on the consolidated financial statements.
+Added: MANAGEMENTS REPORT ON INTERNAL CONTROL OVER FINANCIAL
+Added: Management is responsible for establishing and maintaining adequate internal control over financial reporting, and for
+Added: performing an assessment of the effectiveness of internal control over financial reporting as of December 31, 2020.
+Added: Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
+Added: financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
+Added: The Companys internal control over financial reporting includes those policies and procedures
+Added: that (i) pertain to assets of the Company;
+Added: (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted accounting
+Added: principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company;
+Added: and (iii) provide reasonable assurance regarding prevention or timely detection of
+Added: unauthorized acquisition, use, or disposition of the Companys assets that could have a material effect on the consolidated financial statements.
Management performed an assessment of the effectiveness of the Companys internal control over financial reporting as of
4 unchanged sentences
an independent registered public accounting firm, as stated in their report which appears herein.
−Removed: Report of Independent Registered
−Removed: Public Accounting Firm
+Added: Report of Independent Registered Public Accounting Firm
To the Stockholders and Board of Directors
Solar Capital Ltd.:
−Removed: Opinions on the Consolidated Financial
−Removed: Statements and Internal Control Over Financial Reporting
−Removed: We have audited the accompanying consolidated statements of assets and liabilities, including
−Removed: the consolidated schedule of investments, of Solar Capital Ltd.
−Removed: (and subsidiaries) (the Company) as of December 31, 2019 and 2018, the related consolidated statements of operations, changes in net assets, and cash flows for each of the years in
−Removed: the three-year period ended December 31, 2019, and the related notes (collectively, the consolidated financial statements).
−Removed: We also have audited the Companys internal control over financial reporting as of December 31, 2019, based on
−Removed: criteria established in Internal Control Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
−Removed: In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of
−Removed: December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2019, in conformity with U.S.
+Added: Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting
+Added: We have audited the accompanying consolidated statements of assets and liabilities, including the consolidated schedules of investments, of Solar Capital Ltd.
+Added: (and subsidiaries) (the Company) as of December 31, 2020 and 2019, the related consolidated statements of operations, changes in net assets, and cash flows for each of the years in the three-year period ended December 31, 2020, and the
+Added: related notes (collectively, the consolidated financial statements).
+Added: We also have audited the Companys internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control
+Added: Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
+Added: In our opinion, the consolidated
+Added: financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the years in the
+Added: three-year period ended December 31, 2020, in conformity with U.S.
generally accepted accounting principles.
−Removed: Also in our opinion,
−Removed: the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control Integrated Framework (2013) issued by the
−Removed: Committee of Sponsoring Organizations of the Treadway Commission.
+Added: Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of
+Added: December 31, 2020, based on criteria established in Internal Control Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
Basis for Opinions
−Removed: The Companys management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting,
−Removed: and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying managements report on internal control over financial reporting.
−Removed: Our responsibility is to express an opinion on the
−Removed: Companys consolidated financial statements and an opinion on the Companys internal control over financial reporting based on our audits.
−Removed: We are a public accounting firm registered with the Public Company Accounting Oversight Board
−Removed: (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.
−Removed: federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
−Removed: We conducted our audits in accordance with the standards of the PCAOB.
−Removed: Those standards require that we plan and perform the audits to obtain reasonable
−Removed: assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
−Removed: Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial
−Removed: statements, whether due to error or fraud, and performing procedures that respond to those risks.
−Removed: Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
−Removed: procedures included confirmation of securities owned as of December 31, 2019 and 2018, by correspondence with the custodian, portfolio companies or agents.
−Removed: Our audits also included evaluating the accounting principles used and significant
−Removed: estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
−Removed: Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial
−Removed: reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.
−Removed: Our audits also included performing such other procedures as we
−Removed: considered necessary in the circumstances.
+Added: The Companys management is
+Added: responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying
+Added: managements report on internal control over financial reporting.
+Added: Our responsibility is to express an opinion on the Companys consolidated financial statements and an opinion on the Companys internal control over financial reporting
+Added: based on our audits.
+Added: We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.
+Added: federal securities
+Added: laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
+Added: We conducted our audits in accordance with the
+Added: standards of the PCAOB.
+Added: Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether
+Added: effective internal control over financial reporting was maintained in all material respects.
+Added: Our audits of the consolidated financial statements included
+Added: performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
+Added: Such procedures included examining, on a test basis,
+Added: evidence regarding the amounts and disclosures in the consolidated financial statements.
+Added: Our procedures included confirmation of securities owned as of December 31, 2020 and 2019, by correspondence with the custodian, portfolio companies or
+Added: Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
+Added: Our audit of internal control over
+Added: financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on
+Added: the assessed risk.
+Added: Our audits also included performing such other procedures as we considered necessary in the circumstances.
We believe that our audits provide a reasonable basis for our opinions.
15 unchanged sentences
(1) relates to accounts or disclosures that are
−Removed: material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgment.
+Added: material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial
statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
−Removed: Assessment of the fair value of investments and certain financial liabilities
−Removed: As described in Notes 2 and 6 to the consolidated financial statements, the Company measures its investments at fair value and has made an irrevocable election
−Removed: to apply the fair value option of accounting to certain financial liabilities.
−Removed: In determining the fair value of investments and financial liabilities that are not publicly traded and whose market quotations are not readily available, the Company
−Removed: makes subjective judgments and estimates using unobservable inputs.
+Added: Fair value of investments and certain financial liabilities
+Added: As described in Notes 2 and 6 to the consolidated financial statements, the Company measures its investments at fair value and has made an
+Added: irrevocable election to apply the fair value option of accounting to certain financial liabilities.
+Added: Investments and certain financial liabilities in all asset classes are valued utilizing a market approach, an income approach, or both approaches, as
+Added: In determining the fair value of investments and financial liabilities that are not publicly traded and whose market quotations are not readily available, the Company makes subjective judgments and estimates using unobservable inputs.
As of December 31, 2020, the fair value of such investments and financial liabilities was $1.5 billion and $150 million, respectively.
−Removed: We identified the assessment of fair value of investments and financial liabilities with no readily determinable market value and whose market quotations are
−Removed: not readily available as a critical audit matter.
−Removed: Evaluating the Companys fair value methods/technique, including the key inputs and assumptions, involved a high degree of auditor judgment.
−Removed: In particular, subjective auditor judgment was
−Removed: required to assess the market yields used in the income approach analyses, as well as the selection of comparable companies and financial performance multiples of such comparable companies in the market approach analyses.
−Removed: The primary procedures we performed to address this critical audit matter included the following.
−Removed: We tested certain internal controls over the Companys
−Removed: process to measure fair value of investments and financial liabilities, including controls related to the development of market yields, credit risk, and financial performance multiples assumptions.
−Removed: For a selection of investments, we compared the
−Removed: inputs and assumptions used by the Company to supporting documentation.
−Removed: We evaluated the Companys ability to estimate fair value by comparing market transaction prices to the Companys most recent fair value estimate prior to the market
−Removed: We involved valuation professionals with specialized skills and knowledge who assisted in evaluating the Companys fair value estimate for a selection of investments and financial liabilities by:
+Added: We identified the assessment of fair value of investments and financial liabilities with no readily determinable market value and whose market
+Added: quotations are not readily available as a critical audit matter.
+Added: A high degree of auditor judgment was required to assess the Companys fair value methods and assumptions.
+Added: Specifically, assessing the market yields used in the income approach
+Added: analyses and the selection of comparable companies and the financial performance multiples of such comparable companies used in the market approach analyses required subjective auditor judgment.
+Added: Additionally, the involvement of valuation
+Added: professionals with specialized skills and knowledge was required to assist in evaluating the Companys fair value estimates.
+Added: following are the primary procedures we performed to address this critical audit matter.
+Added: We evaluated the design and tested the operating effectiveness of certain internal controls over the Companys process to measure fair value of investments
+Added: and financial liabilities.
+Added: These included controls related to the development of market yields, credit risk, and financial performance multiples assumptions.
+Added: For a selection of investments and certain financial liabilities, we compared the inputs
+Added: and assumptions used by the Company to underlying documentation.
+Added: We evaluated the Companys ability to estimate fair value by
+Added: comparing market transaction prices to the Companys most recent fair value estimate prior to the market transaction.
+Added: We involved valuation professionals with specialized skills and
+Added: knowledge, who assisted in evaluating the Companys fair value estimate for a selection of investments and financial liabilities by:
developing an independent market yield for investments and financial liabilities fair valued using an income
approach, by assessing available market information, such as market yields of comparable companies of similar credit risk
+Added: developing an independent liquidation timeline for an investment fair valued using a recovery analysis, by
+Added: assessing available market information, such as asset type or comparable companies of similar credit risk
developing an independent market multiple for investments fair valued using a market approach, by assessing
−Removed: market information from third-party sources, including financial performance multiples of comparable companies;
+Added: market information from third-party sources, including financial performance multiples of independently selected comparable companies
developing independent estimates of fair value, for the selected investments and financial liabilities, based
upon the independently developed market yields and financial performance multiples and compared the results of our estimates to the Companys fair value estimates.
−Removed: We have served as the auditor of
−Removed: one or more Solar Capital Partners, LLC (the Investment Advisor) investment companies since 2007.
+Added: We have served as the
+Added: Companys auditor since 2007.
New York, New York
13 unchanged sentences
Receivable for investments sold
−Removed: Other receivables
Prepaid expenses and other assets
17 unchanged sentences
Net Asset Value Per Share
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
18 unchanged sentences
Net investment income
−Removed: REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, CASH EQUIVALENTS AND FOREIGN
+Added: REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND CASH EQUIVALENTS:
Net realized gain (loss) on investments and cash equivalents:
4 unchanged sentences
Net realized loss on extinguishment of debt:
−Removed: Net realized loss on foreign currencies:
Net realized gain (loss)
1 unchanged sentence
Companies less than 5% owned
−Removed: Companies 5% to 25% owned
Companies more than 25% owned
−Removed: Net change in unrealized gain (loss)
−Removed: Net realized and unrealized gain (loss) on investments, cash equivalents and foreign
+Added: Net change in unrealized loss
+Added: Net realized and unrealized loss on investments and cash equivalents
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS
EARNINGS PER SHARE (see note 5)
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
5 unchanged sentences
Net realized gain (loss)
−Removed: Net change in unrealized gain (loss)
+Added: Net change in unrealized loss
Net increase in net assets resulting from operations
4 unchanged sentences
Capital transactions (see note 14):
−Removed: Reinvestment of distributions
Net increase in net assets resulting from capital transactions
−Removed: Total increase (decrease) in net assets
+Added: Total decrease in net assets
Net assets at beginning of year
1 unchanged sentence
Capital share activity (see note 14):
−Removed: Common stock issued from reinvestment of distributions
Net increase from capital share activity
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
4 unchanged sentences
Net increase in net assets resulting from operations
−Removed: Adjustments to reconcile net increase in net assets resulting from operations to net cash provided
−Removed: by (used in) operating activities:
+Added: Adjustments to reconcile net increase in net assets resulting from operations to net cash
+Added: provided by (used in) operating activities:
Net realized (gain) loss on investments and cash equivalents
Net realized loss on extinguishment of debt
−Removed: Net realized loss on foreign currencies
−Removed: Net change in unrealized (gain) loss on investments and cash equivalents
+Added: Net change in unrealized loss on investments and cash equivalents
(Increase) decrease in operating assets:
26 unchanged sentences
Repayments of secured borrowings
−Removed: Repayments of unsecured borrowings
Net Cash Provided by (Used in) Financing Activities
4 unchanged sentences
Cash paid for interest
−Removed: Non-cash financing activities consist of the reinvestment of distributions of $0, $0
−Removed: and $280, for the fiscal years ended December 31, 2019, 2018 and 2017, respectively.
See notes to consolidated financial statements.
4 unchanged sentences
Senior Secured Loans 93.7%
−Removed: Bank Debt/Senior Secured Loans
+Added: First Lien Bank Debt/Senior Secured Loans
Aegis Toxicology Sciences Corporation
2 unchanged sentences
Health Care Providers & Services
−Removed: Altern Marketing, LLC
−Removed: Household & Personal Products
American Teleconferencing Services, Ltd.
4 unchanged sentences
Aerospace & Defense
−Removed: AviatorCap SII, LLC (2)
−Removed: Aerospace & Defense
−Removed: Bishop Lifting Products, Inc.
−Removed: Trading Companies & Distributors
−Removed: Enhanced Capital Group, LLC
+Added: Basic Fun, Inc.
+Added: Specialty Retail
+Added: Enhanced Permanent Capital, LLC(3)
Capital Markets
−Removed: Falmouth Group Holdings Corp.
−Removed: Greystone Select Holdings LLC & Greystone & Co., Inc.
−Removed: Thrifts & Mortgage Finance
−Removed: IHS Intermediate, Inc.**
−Removed: Health Care Providers & Services
Kingsbridge Holdings, LLC(2) .
2 unchanged sentences
Wireless Telecommunication Services
+Added: Legility, LLC
+Added: Commercial Services & Supplies
Logix Holding Company, LLC
Communications Equipment
−Removed: MRI Software LLC
−Removed: On Location Events, LLC & PrimeSport Holdings Inc.
+Added: One Touch Direct, LLC
+Added: Commercial Services & Supplies
Pet Holdings ULC & Pet Supermarket, Inc.
Specialty Retail
−Removed: PhyMed Management LLC
−Removed: Health Care Providers & Services
PhyNet Dermatology LLC
Health Care Providers & Services
+Added: Pinnacle Treatment Centers, Inc.
+Added: Health Care Providers & Services
PPT Management Holdings, LLC
Health Care Providers & Services
−Removed: PSKW, LLC & PDR, LLC
+Added: Sentry Data Systems, Inc.
+Added: Smile Doctors LLC
+Added: Personal Products
+Added: Soleo Health Holdings, Inc.
Health Care Providers & Services
−Removed: PSKW, LLC & PDR, LLC
+Added: The Childrens Place, Inc.(3)
+Added: Specialty Retail
+Added: USR Parent, Inc.
+Added: Specialty Retail
+Added: Total First Lien Bank Debt/Senior Secured Loans
+Added: Second Lien Asset-Based Senior Secured Loans
+Added: Greystone Select Holdings LLC & Greystone & Co., Inc.
+Added: Thrifts & Mortgage Finance
+Added: Varilease Finance, Inc.
+Added: Multi-Sector Holdings
+Added: Total Second Lien Asset-Based Senior Secured Loans
+Added: Second Lien Bank Debt/Senior Secured Loans
+Added: PhyMed Management LLC
Health Care Providers & Services
−Removed: RS Energy Group U.S., Inc.
Rug Doctor LLC (2)
Diversified Consumer Services
−Removed: Solara Medical Supplies, Inc.
−Removed: Health Care Providers & Services
−Removed: The Octave Music Group, Inc.
−Removed: (fka TouchTunes)
−Removed: Varilease Finance, Inc.
−Removed: Multi-Sector Holdings
−Removed: Total Bank Debt/Senior Secured Loans
−Removed: See notes to consolidated financial statements.
−Removed: SOLAR CAPITAL LTD.
−Removed: CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)
−Removed: December 31, 2019
−Removed: (in thousands, except share/unit amounts)
−Removed: Life Science Senior Secured Loans
+Added: Total Second Lien Bank Debt/Senior Secured Loans
+Added: First Lien Life Science Senior Secured Loans
Alimera Sciences, Inc.
4 unchanged sentences
Pharmaceuticals
−Removed: aTyr Pharma, Inc.
−Removed: Pharmaceuticals
Axcella Health Inc.
12 unchanged sentences
Pharmaceuticals
+Added: Neuronetics, Inc.
+Added: Health Care Equipment & Supplies
OmniGuide Holdings, Inc.
6 unchanged sentences
Pharmaceuticals
−Removed: Senseonics Holdings, Inc.
+Added: SI-BONE, Inc.
Health Care Equipment & Supplies
−Removed: Total Life Science Senior Secured Loans
+Added: Total First Lien Life Science Senior Secured Loans
Total Senior Secured Loans
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
2 unchanged sentences
(in thousands, except share/unit amounts)
+Added: Interest Rate
Equipment Financing 33.4%
−Removed: Althoff Crane Service, Inc.
−Removed: Commercial Services & Supplies
AmeraMex International, Inc.
3 unchanged sentences
3/1/2022-11/1/2022
+Added: Boart Longyear Company (14)
+Added: Metals & Mining
C&H Paving, Inc.
2 unchanged sentences
Capital City Jet Center, Inc.
+Added: 10/4/2023-6/22/26
Central Freight Lines, Inc.
2 unchanged sentences
Commercial Services & Supplies
+Added: Environmental Protection & Improvement Company, LLC (10)
Equipment Operating Leases, LLC (2)(12)
1 unchanged sentence
8/1/2022-4/27/2025
+Added: EquipmentShare.com, Inc.
+Added: Commercial Services & Supplies
Family First Freight, LLC (10)
10 unchanged sentences
7/1/2022-7/1/2024
−Removed: Hawkeye Contracting Company, LLC (10)(11)
−Removed: Oil, Gas & Consumable Fuels
HTI Logistics Corporation (10)
12 unchanged sentences
5/16/24-9/25/24
−Removed: Meridian Consulting I Corp, Inc.
−Removed: Hotels, Restaurants & Leisure
Mountain Air Helicopters, Inc.
Commercial Services & Supplies
+Added: 4/30/2022-2/28/2025
+Added: NEF Holdings, LLC (2)
+Added: Multi-Sector Holdings
+Added: Rane Light Metal Castings Inc.
Commercial Services & Supplies
5 unchanged sentences
Royal Express Inc.
−Removed: See notes to consolidated financial statements.
−Removed: SOLAR CAPITAL LTD.
−Removed: CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)
−Removed: December 31, 2019
−Removed: (in thousands, except share/unit amounts)
Sidelines Tree Service LLC (14)
Diversified Consumer Services
−Removed: 8/1/2022-10/1/2022
South Texas Oilfield Solutions, LLC (14)
1 unchanged sentence
9/1/2022-7/1/2023
−Removed: Southern Nevada Oral & Maxillofacial Surgery, LLC (10)
−Removed: Health Care Providers & Services
−Removed: Southwest Traders, Inc.
−Removed: Spartan Education, LLC (10)
−Removed: Diversified Consumer Services
−Removed: 7/31/2020-12/27/2023
ST Coaches, LLC (14)
7 unchanged sentences
Sun-Tech Leasing of Texas, L.P.
−Removed: 6/25/2020-7/25/2021
Superior Transportation, Inc.
2 unchanged sentences
Air Freight & Logistics
+Added: 8/1/2024-10/16/2025
The Smedley Company & Smedley Services, Inc.
2 unchanged sentences
Thora Capital, LLC (10)
−Removed: Tornado Bus Company (14)
Trinity Equipment Rentals, Inc.
8 unchanged sentences
Diversified Consumer Services
+Added: 8/1/2024-10/5/25
Womble Company, Inc.
Energy Equipment & Services
−Removed: W.P.M., Inc., WPM-Southern, LLC, WPM Construction Services,
−Removed: Construction & Engineering
NEF Holdings, LLC Equity Interests (2)(9)
7 unchanged sentences
Total Preferred Equity
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
19 unchanged sentences
Health Care Technology
+Added: KBH Topco LLC (Kingsbridge) (2)(5)
+Added: Multi-Sector Holdings
PQ Bypass, Inc.
15 unchanged sentences
Pharmaceuticals
−Removed: Tetraphase Pharmaceuticals, Inc.
−Removed: Warrants (3)*
−Removed: Pharmaceuticals
Venus Concept Ltd.
12 unchanged sentences
December 31, 2020.
−Removed: See notes to consolidated
−Removed: financial statements.
SOLAR CAPITAL LTD.
1 unchanged sentence
December 31, 2020
−Removed: (in thousands)
Denotes investments in which we are deemed to exercise a controlling influence over the management or policies
4 unchanged sentences
Fair Value at
−Removed: Ark Real Estate Partners LP
−Removed: Ark Real Estate Partners II LP
AviatorCap SII, LLC
2 unchanged sentences
Equipment Operating Leases, LLC
+Added: Kingsbridge Holdings, LLC (debt)
+Added: Kingsbridge Holdings, LLC (equity)
Loyer Capital LLC
−Removed: NEF Holdings, LLC
+Added: NEF Holdings, LLC (equity)
+Added: NEF Holdings, LLC (debt)
RD Holdco Inc.
5 unchanged sentences
Rug Doctor LLC
−Removed: SOINT, LLC (preferred equity)
+Added: See notes to consolidated financial statements.
+Added: SOLAR CAPITAL LTD.
+Added: CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)
+Added: December 31, 2020
+Added: (in thousands)
Indicates assets that the Company believes may not represent qualifying assets under
6 unchanged sentences
common shares, respectively.
−Removed: Bishop Lifting Products, Inc., SEI Holding I Corporation, Singer Equities, Inc.
−Removed: & Hampton Rubber Company
−Removed: are co-borrowers.
+Added: Kingsbridge Holdings, LLC is held through KBH Topco LLC, a Delaware corporation.
Aggregate net unrealized appreciation for U.S.
1 unchanged sentence
aggregate gross
−Removed: unrealized appreciation and depreciation for federal tax purposes is $45,038 and $36,866, respectively, based on a tax cost of $1,486,652.
−Removed: Unless otherwise noted, all of the Companys investments are pledged as collateral against the borrowings
−Removed: outstanding on the senior secured credit facility.
+Added: unrealized appreciation and depreciation for U.S.
+Added: federal tax purposes is $52,349 and $47,903, respectively, based on a tax cost of $1,527,505.
+Added: Unless otherwise noted, all of the Companys investments are pledged as collateral against the
+Added: borrowings outstanding on the senior secured credit facility.
The Company generally acquires its investments in private transactions exempt from registration under the Securities Act of 1933, as amended (the Securities Act).
−Removed: These investments are
−Removed: generally subject to certain limitations on resale, and may be deemed to be restricted securities under the Securities Act.
+Added: investments are generally subject to certain limitations on resale, and may be deemed to be restricted securities under the Securities Act.
All investments are Level 3 unless otherwise indicated.
3 unchanged sentences
Denotes a Level 1 investment.
−Removed: See notes to consolidated financial statements.
−Removed: SOLAR CAPITAL LTD.
−Removed: CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)
−Removed: December 31, 2019
−Removed: (in thousands)
NEF Holdings, LLC is held through NEFCORP LLC, a wholly-owned consolidated taxable subsidiary and NEFPASS LLC,
2 unchanged sentences
through NEFPASS LLC.
−Removed: Hawkeye Contracting Company, LLC, Eagle Creek Mining, LLC & Falcon Ridge Leasing, LLC are co-borrowers.
+Added: Interest is paid in kind (PIK).
Denotes a subsidiary of NEF Holdings, LLC.
10 unchanged sentences
are co-borrowers.
+Added: Spread is 2.50% Cash / 8.50% PIK.
Non-income producing security.
−Removed: Investment is on non-accrual status.
+Added: See notes to consolidated financial statements.
+Added: SOLAR CAPITAL LTD.
+Added: CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)
+Added: December 31, 2020
+Added: (in thousands)
Industry Classification
2 unchanged sentences
of December 31, 2020
−Removed: Diversified Financial Services (Crystal Financial LLC)
−Removed: Multi-Sector Holdings (includes NEF Holdings, LLC, Equipment Operating Leases, LLC and Loyer
+Added: Multi-Sector Holdings (includes Kingsbridge Holdings, LLC, NEF Holdings, LLC, Equipment Operating
+Added: Leases, LLC and Loyer Capital LLC)
+Added: Diversified Financial Services (includes Crystal Financial LLC)
Health Care Providers & Services
2 unchanged sentences
Commercial Services & Supplies
+Added: Specialty Retail
Wireless Telecommunication Services
Communications Equipment
+Added: Thrifts & Mortgage Finance
Diversified Consumer Services
−Removed: Specialty Retail
−Removed: Household & Personal Products
−Removed: Trading Companies & Distributors
Capital Markets
−Removed: Thrifts & Mortgage Finance
Aerospace & Defense
−Removed: Oil, Gas & Consumable Fuels
−Removed: Construction & Engineering
Energy Equipment & Services.
−Removed: Hotels, Restaurants & Leisure
+Added: Metals & Mining
+Added: Construction & Engineering
+Added: Oil, Gas & Consumable Fuels
+Added: Personal Products
Air Freight & Logistics
2 unchanged sentences
Total Investments
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
8 unchanged sentences
Health Care Providers & Services
+Added: Altern Marketing, LLC
+Added: Household & Personal Products
American Teleconferencing Services, Ltd.
−Removed: (PGI) (10)(16)
Communications Equipment
−Removed: Amerilife Group, LLC (10)
−Removed: Associated Pathologists, LLC (10)(16)
−Removed: Health Care Providers & Services
Atria Wealth Solutions, Inc
2 unchanged sentences
Aerospace & Defense
−Removed: BAM Capital, LLC (10)
−Removed: Diversified Financial Services
+Added: AviatorCap SII, LLC (2)
+Added: Aerospace & Defense
Bishop Lifting Products, Inc.
Trading Companies & Distributors
+Added: Enhanced Capital Group, LLC
+Added: Capital Markets
Falmouth Group Holdings Corp.
−Removed: (AMPAC) (10)(16)
−Removed: Global Holdings LLC & Payment Concepts LLC (10)(16)
−Removed: Consumer Finance
Greystone Select Holdings LLC & Greystone & Co., Inc.
8 unchanged sentences
Communications Equipment
+Added: MRI Software LLC
On Location Events, LLC & PrimeSport Holdings Inc.
11 unchanged sentences
Health Care Providers & Services
−Removed: See notes to consolidated financial statements.
−Removed: SOLAR CAPITAL LTD.
−Removed: CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)
−Removed: December 31, 2018
−Removed: (in thousands, except share/unit amounts)
RS Energy Group U.S., Inc.
3 unchanged sentences
Health Care Providers & Services
−Removed: Southern Auto Finance Company (5)(10)
−Removed: Consumer Finance
The Octave Music Group, Inc.
6 unchanged sentences
Pharmaceuticals
+Added: Apollo Endosurgery, Inc.
+Added: Health Care Equipment & Supplies
Ardelyx, Inc.
4 unchanged sentences
Pharmaceuticals
−Removed: BioElectron Technology Corporation (10)
−Removed: Pharmaceuticals
−Removed: Breathe Technologies, Inc.
−Removed: Health Care Equipment & Supplies
Cardiva Medical, Inc.
Health Care Equipment & Supplies
−Removed: Corindus Vascular Robotics, Inc.
+Added: Centrexion Therapeutics, Inc.
+Added: Pharmaceuticals
+Added: Cerapedics, Inc.
Health Care Equipment & Supplies
3 unchanged sentences
Health Care Providers & Services
+Added: Kindred Biosciences, Inc.
+Added: Pharmaceuticals
OmniGuide Holdings, Inc.
2 unchanged sentences
Health Care Equipment & Supplies
−Removed: Restoration Robotics, Inc.
−Removed: Health Care Equipment & Supplies
Rubius Therapeutics, Inc.
2 unchanged sentences
Pharmaceuticals
−Removed: Scynexis, Inc.
−Removed: Pharmaceuticals
−Removed: SentreHeart, Inc.
+Added: Senseonics Holdings, Inc
Health Care Equipment & Supplies
−Removed: Sunesis Pharmaceuticals, Inc.
−Removed: Pharmaceuticals
−Removed: Tetraphase Pharmaceuticals, Inc.
−Removed: Pharmaceuticals
Total Life Science Senior Secured Loans
Total Senior Secured Loans
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
5 unchanged sentences
Commercial Services & Supplies
−Removed: B&W Resources, Inc.
−Removed: Oil, Gas & Consumable Fuels
−Removed: BB578, LLC (10)(12)
−Removed: Beverly Hills Limo and Corporate Coach, Inc.
+Added: AmeraMex International, Inc.
+Added: Commercial Services & Supplies
Blackhawk Mining, LLC (14)
1 unchanged sentence
3/1/2022-11/1/2022
−Removed: Brightwater R&B Acquisition, LLC (10)(17)
C&H Paving, Inc.
Construction & Engineering
+Added: 1/1/2024-11/1/2024
Capital City Jet Center, Inc.
Central Freight Lines, Inc.
−Removed: Cfactor Leasing Corp.
−Removed: & CZM USA, Corp.
−Removed: 5/27/2020-8/3/2022
Champion Air, LLC (10)
−Removed: Delicate Productions, Inc.
−Removed: Commercial Services & Supplies
Easton Sales and Rentals, LLC (10)
3 unchanged sentences
8/1/2022-4/27/2025
−Removed: Falcon Transport Company (10)(12)
Family First Freight, LLC (10)
7/1/2020-1/22/2022
+Added: Freightsol LLC (14)
Garda CL Technical Services, Inc.
5 unchanged sentences
GMT Corporation (14)
−Removed: Great Plains Gas Compression Holdings, LLC (10)(12)
−Removed: Oil, Gas & Consumable Fuels
−Removed: 8/1/2019-9/7/19
Haljoe Coaches USA, LLC (14)
2 unchanged sentences
Oil, Gas & Consumable Fuels
−Removed: See notes to consolidated financial statements.
−Removed: SOLAR CAPITAL LTD.
−Removed: CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)
−Removed: December 31, 2018
−Removed: (in thousands, except share/unit amounts)
HTI Logistics Corporation (10)
Commercial Services & Supplies
+Added: 12/1/2023-4/1/2024
Interstate NDT, Inc.
7/1/2023-10/25/2023
−Removed: JP Motorsports, Inc.
−Removed: Knight Transfer Services, Inc.
−Removed: & Dumpstr Xpress, Inc.
+Added: ISR Holdings, LLC (10)
Commercial Services & Supplies
−Removed: 4/11/2020-4/30/2020
+Added: JP Motorsports, Inc.
Kool Pak, LLC (14)
1 unchanged sentence
Construction & Engineering
−Removed: Marcal Manufacturing, LLC dba Soundview Paper Company, LLC (10)(17)
−Removed: Paper & Forest Products
+Added: Loyer Capital LLC (2)(12)
+Added: Multi-Sector Holdings
5/16/24-9/25/24
3 unchanged sentences
Commercial Services & Supplies
−Removed: Mulholland Energy Services Equipment Leasing, LLC (10)(17)
Commercial Services & Supplies
−Removed: OKK Equipment, LLC (10)(12)
−Removed: Commercial Services & Supplies
−Removed: Reston Limousine & Travel Service, Inc.
−Removed: Rossco Crane & Rigging, Inc.
−Removed: Commercial Services & Supplies
4/1/2023-11/1/2024
−Removed: RVR Air Charter, LLC & RVR Aviation, LLC (10)(12)
−Removed: 8/1/2020-1/1/2022
−Removed: Santek Environmental, LLC (10)(17)
−Removed: Commercial Services & Supplies
−Removed: Santek Environmental of Alabama, LLC (10)(17)
+Added: Rossco Crane & Rigging, Inc.
Commercial Services & Supplies
4/1/2021-9/1/2022
+Added: Royal Coach Lines, Inc.
+Added: Royal Express Inc.
Sidelines Tree Service LLC (14)
7 unchanged sentences
Southwest Traders, Inc.
+Added: Spartan Education, LLC (10)
+Added: Diversified Consumer Services
+Added: 7/31/2020-12/27/2023
ST Coaches, LLC (14)
10/1/2022-1/25/2025
+Added: Stafford Logistics, Inc.
+Added: Commercial Services & Supplies
+Added: 10/1/2024-10/1/2025
Star Coaches Inc.
1 unchanged sentence
Energy Equipment & Services
−Removed: See notes to consolidated financial statements.
−Removed: SOLAR CAPITAL LTD.
−Removed: CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)
−Removed: December 31, 2018
−Removed: (in thousands, except share/unit amounts)
Sun-Tech Leasing of Texas, L.P.
2 unchanged sentences
4/1/2022-8/1/2024
+Added: Tailwinds, LLC (10)
+Added: Air Freight & Logistics
The Smedley Company & Smedley Services, Inc.
1 unchanged sentence
10/29/2023-2/10/2024
+Added: Thora Capital, LLC (10)
Tornado Bus Company (14)
3 unchanged sentences
Up Trucking Services, LLC (14)
−Removed: Waste Services of Alabama, LLC (10)(17)
−Removed: Commercial Services & Supplies
−Removed: Waste Services of Tennessee, LLC (10)(17)
−Removed: Commercial Services & Supplies
4/1/2022-8/1/2024
−Removed: Waste Services of Texas, LLC (10)(17)
+Added: Warrior Crane Services, LLC (10)
Commercial Services & Supplies
−Removed: WJV658, LLC (10)(12)
+Added: 7/11/2024-8/1/2026
+Added: Wind River Environmental, LLC (10)
+Added: Diversified Consumer Services
+Added: Womble Company, Inc.
+Added: Energy Equipment & Services
W.P.M., Inc., WPM-Southern, LLC, WPM Construction Services,
9 unchanged sentences
Total Preferred Equity
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
3 unchanged sentences
Common Equity/Equity Interests/Warrants34.3%
−Removed: Ark Real Estate Partners LP (2)(3)(10)*
−Removed: Diversified Real Estate Activities
−Removed: Ark Real Estate Partners II LP (2)(3)(10)*
−Removed: Diversified Real Estate Activities
aTyr Pharma, Inc.
−Removed: Warrants (10)*
Pharmaceuticals
2 unchanged sentences
CardioFocus, Inc.
−Removed: Warrants (10)*
Health Care Equipment & Supplies
−Removed: CAS Medical Systems, Inc.
−Removed: Warrants (10)*
−Removed: Health Care Equipment & Supplies
+Added: Centrexion Therapeutics, Inc.
+Added: Pharmaceuticals
Conventus Orthopaedics, Inc.
−Removed: Warrants (10)*
Health Care Equipment & Supplies
−Removed: Corindus Vascular Robotics, Inc.
−Removed: Warrants (5)(10)*
−Removed: Health Care Equipment & Supplies
Crystal Financial LLC (2)(3)
1 unchanged sentence
Delphinus Medical Technologies, Inc.
−Removed: Warrants (10)*
Health Care Equipment & Supplies
2 unchanged sentences
PQ Bypass, Inc.
−Removed: Warrants (10)*
Health Care Equipment & Supplies
8 unchanged sentences
Diversified Consumer Services
−Removed: Restoration Robotics, Inc.
−Removed: Warrants (10)*
−Removed: Health Care Equipment & Supplies
Scynexis, Inc.
−Removed: Warrants (10)*
Pharmaceuticals
−Removed: SentreHeart, Inc.
−Removed: Warrants (10)*
+Added: Senseonics Holdings, Inc.
Health Care Equipment & Supplies
Sunesis Pharmaceuticals, Inc.
−Removed: Warrants (10)*
Pharmaceuticals
2 unchanged sentences
Pharmaceuticals
+Added: Venus Concept Ltd.
+Added: Warrants* (fka Restoration Robotics)
+Added: Health Care Equipment & Supplies
Total Common Equity/Equity Interests/Warrants
7 unchanged sentences
Interbank Offered Rate (LIBOR), and which typically reset monthly, quarterly or semi-annually.
−Removed: For each debt investment we have provided the current rate of interest, or in the case of leases the current implied yield, in effect as
−Removed: of December 31, 2018.
−Removed: Ark Real Estate Partners is held through SLRC ADI Corp., a wholly-owned taxable subsidiary.
−Removed: See notes to consolidated financial statements.
+Added: For each debt investment we have provided the current rate of interest, or in the case of leases the current implied yield, in effect as of
+Added: December 31, 2019.
SOLAR CAPITAL LTD.
3 unchanged sentences
Denotes investments in which we are deemed to exercise a controlling influence over the management or policies
−Removed: of a company, as defined in the Investment Company Act of 1940 (1940 Act), due to beneficially owning, either directly or through one or more controlled companies, more than 25% of the outstanding voting securities of the
+Added: of a company, as defined in the Investment Company Act of 1940 (1940 Act), due to beneficially owning, either directly or through one or more controlled companies, more than 25% of the outstanding voting securities of the investment.
Transactions during the year ended December 31, 2019 in these controlled investments are as follows:
4 unchanged sentences
Ark Real Estate Partners II LP
−Removed: AviatorCap SII, LLC I
AviatorCap SII, LLC
+Added: AviatorCap SII, LLC
Crystal Financial LLC
Equipment Operating Leases, LLC
+Added: Loyer Capital LLC
NEF Holdings, LLC
6 unchanged sentences
Rug Doctor LLC
−Removed: Senior Secured Unitranche Loan Program LLC (SSLP)(18)
−Removed: Senior Secured Unitranche Loan Program II LLC (SSLP II)(18)
SOINT, LLC (preferred equity)
−Removed: Denotes investments in which we are an Affiliated Person but not exercising a controlling
−Removed: influence, as defined in the 1940 Act, due to beneficially owning, either directly or through one or more controlled companies, more than 5% but less than 25% of the outstanding voting securities of the investment.
−Removed: Transactions during the year ended
−Removed: December 31, 2018 in these affiliated investments are as follows:
−Removed: Name of Issuer
−Removed: Fair Value at
−Removed: Fair Value at
−Removed: DSW Group Holdings LLC
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
15 unchanged sentences
federal income tax purposes is $8,172;
−Removed: aggregate gross unrealized
−Removed: appreciation and depreciation for federal tax purposes is $21,655 and $20,802, respectively, based on a tax cost of $1,455,227.
−Removed: All of the Companys investments are pledged as collateral against the borrowings outstanding on the revolving
−Removed: credit facility.
+Added: aggregate gross
+Added: unrealized appreciation and depreciation for U.S.
+Added: federal tax purposes is $45,038 and $36,866, respectively, based on a tax cost of $1,486,652.
+Added: Unless otherwise noted, all of the Companys investments are pledged as collateral against the
+Added: borrowings outstanding on the senior secured credit facility.
The Company generally acquires its investments in private transactions exempt from registration under the Securities Act of 1933, as amended (the Securities Act).
−Removed: These investments are generally subject to certain
−Removed: limitations on resale, and may be deemed to be restricted securities under the Securities Act.
+Added: investments are generally subject to certain limitations on resale, and may be deemed to be restricted securities under the Securities Act.
+Added: All investments are Level 3 unless otherwise indicated.
Floating rate instruments accrue interest at a predetermined spread relative to an index, typically the LIBOR
or PRIME rate.
−Removed: These instruments are typically subject to a LIBOR or PRIME rate floor.
−Removed: Level 3 investment valued using significant unobservable inputs.
+Added: These instruments are often subject to a LIBOR or PRIME rate floor.
+Added: Denotes a Level 1 investment.
NEF Holdings, LLC is held through NEFCORP LLC, a wholly-owned consolidated taxable subsidiary and NEFPASS LLC,
3 unchanged sentences
Hawkeye Contracting Company, LLC, Eagle Creek Mining, LLC & Falcon Ridge Leasing, LLC are co-borrowers.
−Removed: Equipment Operating Leases, LLC is a subsidiary of NEF Holdings, LLC.
+Added: Denotes a subsidiary of NEF Holdings, LLC.
OmniGuide Holdings, Inc., Domain Surgical, Inc.
1 unchanged sentence
co-borrowers.
−Removed: Indicates an investment that is wholly or partially held by the Company through its wholly-owned consolidated
−Removed: financing subsidiary SSLP 2016-1, LLC (the SSLP SPV).
−Removed: Such investments are pledged as collateral under the SSLP 2016-1, LLC Revolving Credit Facility (see
−Removed: Note 7 to the consolidated financial statements) and are not generally available to creditors, if any, of the Company.
Indicates an investment that is held by the Company through its wholly-owned consolidated financing subsidiary
2 unchanged sentences
any, of the Company.
−Removed: On September 14, 2018 and September 18, 2018, the Company acquired 100% of the equity of SSLP II and
−Removed: SSLP, respectively, and as such consolidated these investments as of this date.
−Removed: On December 19, 2018, SSLP and SSLP II were merged into the Company.
+Added: Spread is 6.00% Cash / 0.75% PIK.
+Added: Kindred Biosciences, Inc., KindredBio Equine, Inc.
+Added: and Centaur Biopharmaceutical Services, Inc.
+Added: are co-borrowers.
Non-income producing security.
−Removed: Represents estimated change in receivable balance.
+Added: Investment is on non-accrual status.
See notes to consolidated financial statements.
7 unchanged sentences
of December 31, 2019
−Removed: Diversified Financial Services (Crystal Financial LLC)
−Removed: Multi-Sector Holdings (includes NEF Holdings, LLC and Equipment Operating Leases, LLC)
+Added: Diversified Financial Services (includes Crystal Financial LLC)
+Added: Multi-Sector Holdings (includes NEF Holdings, LLC, Equipment Operating Leases, LLC and Loyer
Health Care Providers & Services
1 unchanged sentence
Health Care Equipment & Supplies
+Added: Commercial Services & Supplies
Wireless Telecommunication Services
Communications Equipment
−Removed: Consumer Finance
+Added: Diversified Consumer Services
Specialty Retail
+Added: Household & Personal Products
Trading Companies & Distributors
−Removed: Diversified Consumer Services
−Removed: Commercial Services & Supplies
+Added: Capital Markets
Thrifts & Mortgage Finance
−Removed: Oil, Gas & Consumable Fuels
Aerospace & Defense
−Removed: Energy Equipment & Services
+Added: Oil, Gas & Consumable Fuels
Construction & Engineering
+Added: Energy Equipment & Services.
Hotels, Restaurants & Leisure.
−Removed: Paper & Forest Products
+Added: Air Freight & Logistics
Research & Consulting Services
Health Care Technology
−Removed: Diversified Real Estate Activities
Total Investments
−Removed: See notes to consolidated financial
+Added: See notes to consolidated financial statements.
SOLAR CAPITAL LTD.
21 unchanged sentences
Furthermore, as the Company is an investment company, it continues to apply the guidance in FASB Accounting Standards Codification (ASC) Topic 946.
−Removed: In addition, for tax purposes, the Company has elected to be treated, and
−Removed: intend to qualify annually, as a regulated investment company (RIC) under Subchapter M of the Internal Revenue Code of 1986, as amended (the Code).
−Removed: On February 9, 2010, Solar Capital priced its initial public offering, selling 5.68 million shares, including the underwriters
−Removed: over-allotment, at a price of $18.50 per share.
+Added: In addition, for U.S.
+Added: federal income tax purposes, the Company has elected to
+Added: be treated, and intends to qualify annually, as a regulated investment company (RIC) under Subchapter M of the Internal Revenue Code of 1986, as amended (the Code).
+Added: On February 9, 2010, Solar Capital priced its initial public offering, selling 5.68 million shares of common stock, including the
+Added: underwriters over-allotment, at a price of $18.50 per share.
Concurrent with this offering, the Companys senior management purchased an additional 600,000 shares through a private placement, also at $18.50 per share.
19 unchanged sentences
statements and the reported amounts of income and expenses during the reported periods.
−Removed: Changes in the economic environment, financial markets and any other parameters used in determining these
−Removed: estimates could cause actual results to differ materially.
−Removed: In the opinion of management, all adjustments, which are of a normal recurring
−Removed: nature, considered necessary for the fair presentation of financial statements have been included.
−Removed: The significant accounting policies
−Removed: consistently followed by the Company are:
+Added: Changes in the economic environment, financial markets and any other
+Added: parameters used in determining these estimates could cause actual results to differ materially.
+Added: In the opinion of management, all
+Added: adjustments, which are of a normal recurring nature, considered necessary for the fair presentation of financial statements have been included.
+Added: The significant accounting policies consistently followed by the Company are:
Investment transactions are accounted for on the trade date;
29 unchanged sentences
(in thousands, except share amounts)
−Removed: Investments in all asset classes are valued utilizing a market approach, an income approach,
−Removed: or both approaches, as appropriate.
−Removed: However, in accordance with ASC 820-10, certain investments that qualify as investment companies in accordance with ASC 946, may be valued using net asset value as a
−Removed: practical expedient for fair value.
−Removed: The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business).
−Removed: The income approach uses valuation
−Removed: approaches to convert future amounts (for example, cash flows or earnings) to a single present amount (discounted).
+Added: Investments in all asset classes are valued utilizing a market approach, an income approach, or both approaches, as appropriate.
+Added: accordance with ASC 820-10, certain investments that qualify as investment companies in accordance with ASC 946, may be valued using net asset value as a practical expedient for fair value.
+Added: The market approach
+Added: uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business).
+Added: The income approach uses valuation approaches to convert future amounts (for example, cash
+Added: flows or earnings) to a single present amount (discounted).
The measurement is based on the value indicated by current market expectations about those future amounts.
−Removed: In following these
−Removed: approaches, the types of factors that we may take into account in fair value pricing our investments include, as relevant:
−Removed: available current market data, including relevant and applicable market trading and transaction comparables, applicable market
−Removed: yields and multiples, security covenants, call protection provisions, the nature and realizable value of any collateral, the portfolio companys ability to make payments, its earnings and discounted cash flows, the markets in which the
−Removed: portfolio company does business, comparisons of financial ratios of peer companies that are public, M&A comparables, our principal market (as the reporting entity) and enterprise values, among other factors.
−Removed: When available, broker quotations
−Removed: and/or quotations provided by pricing services are considered as an input in the valuation process.
−Removed: For the fiscal year ended December 31, 2019, there has been no change to the Companys valuation approaches or techniques and the nature of
−Removed: the related inputs considered in the valuation process.
−Removed: ASC Topic 820 classifies the inputs used to measure these fair values into the
−Removed: following hierarchy:
−Removed: Quoted prices in active markets for identical assets or liabilities, accessible
−Removed: by the Company at the measurement date.
−Removed: Quoted prices for similar assets or liabilities in active
−Removed: markets, or quoted prices for identical or similar assets or liabilities in markets that are not active, or other observable inputs other than quoted prices.
+Added: In following these approaches, the types of factors that we may take into account
+Added: in fair value pricing our investments include, as relevant:
+Added: available current market data, including relevant and applicable market trading and transaction comparables, applicable market yields and multiples, security covenants, call protection
+Added: provisions, the nature and realizable value of any collateral, the portfolio companys ability to make payments, its earnings and discounted cash flows, the markets in which the portfolio company does business, comparisons of financial ratios
+Added: of peer companies that are public, M&A comparables, our principal market (as the reporting entity) and enterprise values, among other factors.
+Added: When available, broker quotations and/or quotations provided by pricing services are considered as an
+Added: input in the valuation process.
+Added: For the fiscal year ended December 31, 2020, there has been no change to the Companys valuation approaches or techniques and the nature of the related inputs considered in the valuation process.
+Added: ASC Topic 820 classifies the inputs used to measure these fair values into the following hierarchy:
+Added: Quoted prices in active markets for identical assets or liabilities, accessible by the Company at the
+Added: measurement date.
+Added: Quoted prices for similar assets or liabilities in active markets, or quoted prices
+Added: for identical or similar assets or liabilities in markets that are not active, or other observable inputs other than quoted prices.
Unobservable inputs for the asset or liability.
17 unchanged sentences
December 31, 2020
−Removed: (in thousands, except share amounts)
+Added: thousands, except share amounts)
federal income taxes.
The Company, at its discretion, may carry forward taxable income in excess of calendar year distributions and pay a 4% excise tax on this income.
−Removed: The Company will
−Removed: accrue excise tax on such estimated excess taxable income as appropriate.
+Added: The Company will accrue excise tax on such
+Added: estimated excess taxable income as appropriate.
Book and tax basis differences relating to stockholder distributions and other permanent book and tax
40 unchanged sentences
December 31, 2020
−Removed: (in thousands, except share amounts)
+Added: thousands, except share amounts)
Investments that are expected to pay regularly scheduled interest in cash are generally placed on non-accrual status when principal or interest cash payments are past due 30 days or more (90 days or more for equipment financing) and/or when it is no longer probable that principal or interest cash payments will
10 unchanged sentences
Recent Accounting Pronouncements
−Removed: In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework
−Removed: Changes to the Disclosure Requirements for Fair Value Measurement.
−Removed: The amendments in this Update modify and eliminate certain disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement.
−Removed: ASU 2018-13 is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.
−Removed: Early adoption is permitted.
−Removed: The Company will adopt ASU 2018-13 effective in fiscal year 2020.
−Removed: In March 2017, the FASB issued ASU
−Removed: 2017-08, Premium Amortization on Purchased Callable Debt Securities, which will amend FASB ASC 310-20.
−Removed: The amendments in this Update shorten the amortization period for
−Removed: certain callable debt securities held at a premium, generally requiring the premium to be amortized to the earliest call date.
−Removed: For public business entities, the amendments are effective for fiscal years, and interim periods within those fiscal
−Removed: years, beginning after December 15, 2018.
−Removed: Early adoption is permitted, including adoption in an interim period.
−Removed: The Company has adopted ASU 2017-08 and determined that the adoption has not had a material
−Removed: impact on its consolidated financial statements and disclosures.
−Removed: Solar Capital has an Advisory Agreement with the Investment Adviser, under which the Investment Adviser will manage the day-to-day operations of, and provide investment advisory services to, Solar Capital.
−Removed: For providing these services, the Investment Adviser receives a fee from Solar Capital,
−Removed: consisting of two componentsa base management fee and a performance-based incentive fee.
−Removed: The base management fee is determined by taking the average value of Solar Capitals gross assets at the end of the two most recently completed
−Removed: calendar quarters calculated at an annual rate of 1.75% on gross assets up to 200% of the Companys total net assets as of the immediately preceding quarter end and 1.00% on gross assets that exceed 200% of the Companys total net assets
−Removed: as of the immediately preceding quarter end.
−Removed: For purposes of computing the base management fee, gross assets exclude temporary assets acquired at the end of each fiscal quarter for purposes of preserving investment flexibility in the next fiscal
+Added: In March 2020, the FASB issued Accounting Standards Update No.
+Added: 2020-04, Reference Rate
+Added: Reform (Topic 848):
+Added: Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The guidance provides optional expedients and exceptions for applying GAAP to contract modifications, hedging relationships and other
+Added: transactions, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued because of the reference rate reform.
+Added: ASU 2020-04 is effective for all entities as
+Added: of March 12, 2020 through December 31, 2022.
+Added: The Company is evaluating the potential impact that the adoption of this guidance will have on the Companys financial statements.
+Added: Solar Capital has an
+Added: investment advisory and management agreement (the Advisory Agreement) with the Investment Adviser, under which the Investment Adviser will manage the
+Added: day-to-day operations of, and provide investment advisory services to, Solar Capital.
+Added: For providing these services, the Investment Adviser receives a fee from Solar
+Added: Capital, consisting of two componentsa base management fee and a performance-based incentive fee.
+Added: The base management fee is determined by taking the average value of Solar Capitals gross assets at the end of the two most recently
+Added: completed calendar quarters calculated at an annual rate of 1.75% on gross assets up to 200% of the Companys total net assets as of the immediately preceding quarter end and 1.00% on gross assets that exceed 200% of the Companys total
+Added: net assets as of the immediately preceding quarter end.
+Added: For purposes of computing the base management fee, gross assets exclude temporary assets acquired at the end of each fiscal quarter for purposes of preserving investment flexibility in the next
+Added: fiscal quarter.
Temporary assets include, but are not limited to, U.S.
1 unchanged sentence
government or government agency securities, repurchase agreements or cash borrowings.
+Added: The performance-based incentive fee has two parts, as follows:
+Added: one part is calculated and payable quarterly in arrears based on Solar
+Added: Capitals pre-incentive fee net investment income for the immediately preceding calendar quarter.
+Added: For this purpose, pre-incentive fee net investment income means
+Added: interest income, dividend income and any other income (including any other fees (other than fees for providing managerial assistance), such as commitment, origination, structuring, diligence and consulting fees or other fees that we receive from
+Added: portfolio companies) accrued during the calendar quarter, minus Solar Capitals operating expenses for the quarter (including the base management fee, any expenses payable under the Administration Agreement, and any interest expense and
+Added: distributions paid on any issued and outstanding preferred stock, but excluding the
SOLAR CAPITAL LTD.
1 unchanged sentence
December 31, 2020
−Removed: (in thousands, except share amounts)
−Removed: The performance-based incentive fee has two parts, as follows:
−Removed: one part is calculated and
−Removed: payable quarterly in arrears based on Solar Capitals pre-incentive fee net investment income for the immediately preceding calendar quarter.
−Removed: For this purpose, pre-incentive fee net investment income
−Removed: means interest income, dividend income and any other income (including any other fees (other than fees for providing managerial assistance), such as commitment, origination, structuring, diligence and consulting fees or other fees that we receive
−Removed: from portfolio companies) accrued during the calendar quarter, minus Solar Capitals operating expenses for the quarter (including the base management fee, any expenses payable under the Administration Agreement, and any interest expense and
−Removed: distributions paid on any issued and outstanding preferred stock, but excluding the performance-based incentive fee).
−Removed: Pre-incentive fee net investment income does not include any realized capital gains or
−Removed: losses, or unrealized capital appreciation or depreciation.
−Removed: Pre-incentive fee net investment income, expressed as a rate of return on the value of Solar Capitals net assets at the end of the immediately
−Removed: preceding calendar quarter, is compared to the hurdle rate of 1.75% per quarter (7% annualized).
−Removed: Solar Capital pays the Investment Adviser a performance-based incentive fee with respect to Solar Capitals
−Removed: pre-incentive fee net investment income in each calendar quarter as follows:
−Removed: (1) no performance-based incentive fee in any calendar quarter in which Solar Capitals
−Removed: pre-incentive fee net investment income does not exceed the hurdle rate;
−Removed: (2) 100% of Solar Capitals pre-incentive fee net investment income with respect to
−Removed: that portion of such pre-incentive fee net investment income, if any, that exceeds the hurdle rate but is less than 2.1875% in any calendar quarter;
+Added: thousands, except share amounts)
+Added: performance-based incentive fee).
+Added: Pre-incentive fee net investment income does not include any realized capital gains or losses, or unrealized capital appreciation or depreciation.
+Added: Pre-incentive fee net
+Added: investment income, expressed as a rate of return on the value of Solar Capitals net assets at the end of the immediately preceding calendar quarter, is compared to the hurdle rate of 1.75% per quarter (7% annualized).
+Added: Solar Capital pays
+Added: the Investment Adviser a performance-based incentive fee with respect to Solar Capitals pre-incentive fee net investment income in each calendar quarter as follows:
+Added: (1) no performance-based
+Added: incentive fee in any calendar quarter in which Solar Capitals pre-incentive fee net investment income does not exceed the hurdle rate;
+Added: (2) 100% of Solar Capitals
+Added: pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the hurdle rate but is less
+Added: than 2.1875% in any calendar quarter;
and (3) 20% of the amount of Solar Capitals pre-incentive fee net investment income, if any, that exceeds 2.1875% in any calendar quarter.
−Removed: These calculations are appropriately pro-rated for any period of less than three
−Removed: The second part of the performance-based incentive fee is determined and payable in arrears as of the end of each calendar year
−Removed: (or upon termination of the Advisory Agreement, as of the termination date), and will equal 20% of Solar Capitals cumulative realized capital gains less cumulative realized capital losses, unrealized capital depreciation (unrealized
−Removed: depreciation on a gross investment-by-investment basis at the end of each calendar year) and all net capital gains upon which prior performance-based capital gains
−Removed: incentive fee payments were previously made to the Investment Adviser.
−Removed: For financial statement purposes, the second part of the performance-based incentive fee is accrued based upon 20% of cumulative net realized gains and net unrealized capital
−Removed: appreciation.
+Added: These calculations
+Added: are appropriately pro-rated for any period of less than three months.
+Added: The second part of the
+Added: performance-based incentive fee is determined and payable in arrears as of the end of each calendar year (or upon termination of the Advisory Agreement, as of the termination date), and will equal 20% of Solar Capitals cumulative realized
+Added: capital gains less cumulative realized capital losses, unrealized capital depreciation (unrealized depreciation on a gross investment-by-investment basis at the end of
+Added: each calendar year) and all net capital gains upon which prior performance-based capital gains incentive fee payments were previously made to the Investment Adviser.
+Added: For financial statement purposes, the second part of the performance-based
+Added: incentive fee is accrued based upon 20% of cumulative net realized gains and net unrealized capital appreciation.
No accrual was required for the fiscal years ended December 31, 2020, 2019 and 2018.
−Removed: For the fiscal years ended
−Removed: December 31, 2019, 2018 and 2017, the Company recognized $26,774, $25,789 and $27,409, respectively, in base management fees and $18,111, $18,722 and $17,055, respectively, in performance-based incentive fees.
−Removed: Solar Capital has also entered into an Administration Agreement with Solar Capital Management, LLC (the Administrator) under which
−Removed: the Administrator provides administrative services to Solar Capital.
−Removed: For providing these services, facilities and personnel, Solar Capital reimburses the Administrator for Solar Capitals allocable portion of overhead and other expenses
−Removed: incurred by the Administrator in performing its obligations under the Administration Agreement, including rent.
−Removed: The Administrator will also provide, on Solar Capitals behalf, managerial assistance to those portfolio companies to which Solar
−Removed: Capital is required to provide such assistance.
+Added: For the fiscal years ended December 31, 2020, 2019 and 2018, the Company recognized $24,951, $26,774 and $25,789, respectively, in base
+Added: management fees and $2,272, $18,111 and $18,722, respectively, in performance-based incentive fees.
+Added: Solar Capital has also entered into
+Added: an Administration Agreement with Solar Capital Management, LLC (the Administrator) under which the Administrator provides administrative services to Solar Capital.
+Added: For providing these services, facilities and personnel, Solar Capital
+Added: reimburses the Administrator for Solar Capitals allocable portion of overhead and other expenses incurred by the Administrator in performing its obligations under the Administration Agreement, including rent.
+Added: The Administrator will also
+Added: provide, on Solar Capitals behalf, managerial assistance to those portfolio companies to which Solar Capital is required to provide such assistance.
The Company typically reimburses the Administrator on a quarterly basis.
−Removed: For the fiscal
−Removed: years ended December 31, 2019, 2018 and 2017, the Company recognized expenses under the Administration Agreement of $5,265, $5,247 and $5,215, respectively.
−Removed: No managerial assistance fees were accrued or collected for the fiscal years ended
−Removed: December 31, 2019, 2018 and 2017.
−Removed: SOLAR CAPITAL LTD.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
−Removed: December 31, 2019
−Removed: (in thousands, except share amounts)
+Added: For the fiscal years ended December 31, 2020, 2019 and 2018, the Company recognized expenses under the Administration Agreement of
+Added: $5,215, $5,265 and $5,247, respectively.
+Added: No managerial assistance fees were accrued or collected for the fiscal years ended December 31, 2020, 2019 and 2018.
Net Asset Value Per Share
1 unchanged sentence
compares to total net assets and net asset value per share at December 31, 2019 of $905,880 and $21.44, respectively.
−Removed: The following table sets forth the computation of basic and diluted net increase in net assets per share resulting from
−Removed: operations, pursuant to ASC 260-10, for the years ended December 31, 2019, 2018 and 2017:
+Added: SOLAR CAPITAL LTD.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
December 31, 2020
+Added: thousands, except share amounts)
+Added: Earnings Per Share
+Added: The following table sets forth the computation of basic and diluted net increase in net assets per share resulting from operations, pursuant to
+Added: ASC 260-10, for the years ended December 31, 2020, 2019 and 2018:
December 31, 2020
December 31, 2019
+Added: December 31, 2018
Earnings per share (basic & diluted)
24 unchanged sentences
applicable, an independent third-party valuation firms own assumptions about the assumptions a market participant would use in pricing the asset or liability.
+Added: When the inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is
+Added: categorized is based on the lowest level input that is significant to the fair value measurement in its entirety.
+Added: For example, a Level 3 fair value measurement may include inputs that are observable (Levels 1 and 2) and unobservable
SOLAR CAPITAL LTD.
1 unchanged sentence
December 31, 2020
−Removed: (in thousands, except share amounts)
−Removed: When the inputs used to measure fair value fall within different levels of the hierarchy, the
−Removed: level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement in its entirety.
−Removed: For example, a Level 3 fair value measurement may include inputs that are
−Removed: observable (Levels 1 and 2) and unobservable (Level 3).
−Removed: Gains and losses for assets and liabilities categorized within the
−Removed: Level 3 table below may include changes in fair value that are attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3).
+Added: thousands, except share amounts)
+Added: Gains and losses for assets
+Added: and liabilities categorized within the Level 3 table below may include changes in fair value that are attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3).
A review of fair value hierarchy classifications is conducted on a quarterly basis.
1 unchanged sentence
result in a reclassification for certain financial assets or liabilities.
−Removed: Such reclassifications are reported as transfers in/out of the appropriate category as of the end of the quarter in which the reclassifications occur.
−Removed: Within the fair value
−Removed: hierarchy tables below, cash and cash equivalents are excluded but could be classified as Level 1.
−Removed: The following tables present the
−Removed: balances of assets and liabilities measured at fair value on a recurring basis, as of December 31, 2019 and 2018:
+Added: Such reclassifications involving Level 3 assets and liabilities are reported as transfers in/out of Level 3 as of the end of the quarter in which the
+Added: reclassifications occur.
+Added: Within the fair value hierarchy tables below, cash and cash equivalents are excluded but could be classified as Level 1.
+Added: The following tables present the balances of assets and liabilities measured at fair value on a recurring basis, as of December 31, 2019
+Added: Fair Value Measurements
As of December 31, 2020
12 unchanged sentences
Total Investments
−Removed: Credit Facility, 2022 Unsecured Notes and SSLP 2016-1,
−Removed: LLC Revolving Credit Facility (SSLP Facility)
+Added: 2022 Unsecured Notes
SOLAR CAPITAL LTD.
1 unchanged sentence
December 31, 2020
−Removed: (in thousands, except share amounts)
−Removed: The following table provides a summary of the changes in fair value of Level 3 assets
−Removed: for the year ended December 31, 2019, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets still held at December 31, 2019:
+Added: thousands, except share amounts)
+Added: The following table provides a
+Added: summary of the changes in fair value of Level 3 assets for the year ended December 31, 2020, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets still held at
+Added: December 31, 2020:
Fair Value Measurements Using Level 3 Inputs
Senior Secured
+Added: Preferred Equity
Common Equity/
1 unchanged sentence
Total gains or losses included in earnings:
−Removed: Net realized gain (loss)
+Added: Net realized loss
Net change in unrealized gain (loss)
5 unchanged sentences
held by the Company at the end of the period:
−Removed: Net change in unrealized gain (loss)
+Added: Net change in unrealized loss
The following table shows a reconciliation of the beginning and ending balances for fair valued liabilities
measured using significant unobservable inputs (Level 3) for the year ended December 31, 2020:
−Removed: Credit Facility, 2022 Unsecured Notes and SSLP Facility
+Added: 2022 Unsecured Notes
For the year ended
3 unchanged sentences
Net change in unrealized (gain) loss
−Removed: Transfers into Level 3
−Removed: Transfers out of Level 3
+Added: Transfers in/out of Level 3
Ending fair value
2 unchanged sentences
On December 31, 2020, there were borrowings of $150,000 on the 2022 Unsecured Notes.
−Removed: The Company did not elect to apply the fair value option of accounting to the SSLP Facility, which was refinanced by way of amendment on
−Removed: May 31, 2019.
−Removed: As this refinancing was deemed to be a significant modification of debt, per ASC 825-10-25, a new election was triggered.
−Removed: As such the SSLP Facility is
−Removed: shown as a transfer out of Level 3.
SOLAR CAPITAL LTD.
1 unchanged sentence
December 31, 2020
−Removed: (in thousands, except share amounts)
−Removed: The following table provides a summary of the changes in fair value of Level 3 assets
−Removed: for the year ended December 31, 2018, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets still held at December 31, 2018:
+Added: thousands, except share amounts)
+Added: The following table provides a summary of the
+Added: changes in fair value of Level 3 assets and liabilities for the year ended December 31, 2019, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities
+Added: still held at December 31, 2019:
Fair Value Measurements Using Level 3 Inputs
13 unchanged sentences
Net change in unrealized gain (loss)
−Removed: During the year ended December 31, 2018, the Companys investments in SSLP and SSLP II were
−Removed: consolidated, and as such the Level 3 assets held by SSLP and SSLP II are reflected as transfers into Level 3.
−Removed: The following
−Removed: table shows a reconciliation of the beginning and ending balances for fair valued liabilities measured using significant unobservable inputs (Level 3) for the year ended December 31, 2018:
−Removed: Credit Facility, 2022 Unsecured Notes, SSLP Facility and SSLP
+Added: The following table shows a reconciliation of the beginning and ending balances for fair valued liabilities
+Added: measured using significant unobservable inputs (Level 3) for the year ended December 31, 2019:
+Added: Credit Facility, 2022 Unsecured Notes and SSLP Facility
For the year ended
3 unchanged sentences
Net change in unrealized (gain) loss
−Removed: Transfers in/out of Level 3
+Added: Transfers into Level 3
+Added: Transfers out of Level 3
Ending fair value
−Removed: The Company made irrevocable elections to apply the fair value option of accounting to the Credit Facility,
−Removed: the 2022 Unsecured Notes, the SSLP Facility and the SSLP II 2016-1, LLC Revolving Credit Facility (SSLP II Facility), in accordance with ASC 825-10.
−Removed: December 31, 2018, there were borrowings of $146,400, $150,000, $53,785 and $0, respectively, on the Credit Facility, the 2022 Unsecured Notes, the SSLP Facility and the SSLP II Facility.
−Removed: As a result of the consolidation of SSLP and SSLP II,
−Removed: the SSLP Facility and the SSLP II Facility are shown as transfers into Level 3.
+Added: The Company made elections to apply the fair value option of accounting to the 2022 Unsecured Notes, in
+Added: accordance with ASC 825-10.
+Added: On December 31, 2019, there were borrowings of $150,000 on the 2022 Unsecured Notes.
SOLAR CAPITAL LTD.
1 unchanged sentence
December 31, 2020
−Removed: (in thousands, except share amounts)
+Added: thousands, except share amounts)
+Added: The Company did not elect to
+Added: apply the fair value option of accounting to the SSLP Facility, which was refinanced by way of amendment on May 31, 2019.
+Added: As this refinancing was deemed to be a significant modification of debt, per ASC 825-10-25, a new election was triggered.
+Added: As such the SSLP Facility is shown as a transfer out of Level 3.
Quantitative Information about Level 3 Fair Value Measurements
12 unchanged sentences
Fair Value at
+Added: December 31, 2020
Principal Valuation
−Removed: Unobservable Input
Range (Weighted
1 unchanged sentence
Income Approach
−Removed: Market Approach
−Removed: EBITDA Multiple
5.8% 16.4% (8.9%)
−Removed: 7.8x-8.0x (7.9x)
Equipment Financing
Income Approach
−Removed: Market Approach
−Removed: Return on Equity
6.6% 20.3% (10.3%)
+Added: Market Approach
10.9% 10.9% (10.9%)
3 unchanged sentences
Common Equity/Equity Interests/Warrants
−Removed: Market Approach
−Removed: Market Approach
−Removed: EBITDA Multiple
−Removed: Return on Equity
+Added: Market Multiple (1)
5.8x 6.3x (6.3x)
+Added: Market Approach
(10.3%) 13.7% (0.5%)
2 unchanged sentences
1.5% 4.6% (4.5%)
−Removed: Quantitative information about the Companys Level 3 asset and liability fair value measurements as
−Removed: of December 31, 2018 is summarized in the table below:
+Added: Includes $675 of investments valued using a weighted valuation approach, $492 of investments valued using a
+Added: Black-Scholes model, $6,442 of investments valued using an EBITDA multiple and $136,596 of investments which, due to the proximity of the transaction relative to the measurement date, were valued using the cost of the investments.
+Added: SOLAR CAPITAL LTD.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
+Added: December 31, 2020
+Added: thousands, except share amounts)
+Added: Quantitative information about
+Added: the Companys Level 3 asset and liability fair value measurements as of December 31, 2019 is summarized in the table below:
Fair Value at
+Added: December 31, 2019
Principal Valuation
4 unchanged sentences
6.2% 11.9% (9.3%)
+Added: Market Approach
+Added: EBITDA Multiple
+Added: 7.8x - 8.0x (7.9x)
Equipment Financing
Income Approach
+Added: 7.2% 19.7% (10.0%)
Market Approach
1 unchanged sentence
7.8% 7.8% (7.8%)
−Removed: 9.1%-9.1% (9.1%)
Preferred Equity
3 unchanged sentences
Market Approach
−Removed: Market Approach
EBITDA Multiple
−Removed: Return on Equity
5.8x 6.3x (6.0x)
+Added: Market Approach
+Added: Return on Equity
3.9% 17.0% (17.0%)
−Removed: Credit Facility and SSLP Facility
−Removed: Income Approach
−Removed: L+1.4% L+4.8%
2022 Unsecured Notes
5 unchanged sentences
yields or decrease in EBITDA multiples may result in a decrease in the fair value of certain of the Companys investments.
−Removed: SOLAR CAPITAL LTD.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
−Removed: December 31, 2019
−Removed: (in thousands, except share amounts)
Our debt obligations consisted of the following as of December 31, 2020 and December 31, 2019:
1 unchanged sentence
December 31, 2019
+Added: Carrying Value
+Added: Carrying Value
Credit Facility
−Removed: SSLP Facility
NEFPASS Facility
4 unchanged sentences
2026 Unsecured Notes
−Removed: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $2,683 as of December 31,
−Removed: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $851 and $1,067, respectively,
−Removed: as of December 31, 2019 and December 31, 2018.
−Removed: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $95 and $123, respectively, as
−Removed: of December 31, 2019 and December 31, 2018.
−Removed: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $1,124 and $1,457,
−Removed: respectively, as of December 31, 2019 and December 31, 2018.
−Removed: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $1,268 as of December 31,
−Removed: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $762 as of December 31,
+Added: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $2,234 and $2,683 as of
+Added: December 31, 2020 and December 31, 2019, respectively.
+Added: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $623 and $851 as of
+Added: December 31, 2020 and December 31, 2019, respectively.
+Added: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $70 and $95 as of
+Added: December 31, 2020 and December 31, 2019, respectively.
+Added: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $775 and $1,124 as of
+Added: December 31, 2020 and December 31, 2019, respectively.
+Added: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $1,123 and $1,268 as of
+Added: December 31, 2020 and December 31, 2019, respectively.
+Added: Carrying Value equals the Face Amount net of unamortized debt issuance costs of $724 and $762 as of
+Added: December 31, 2020 and December 31, 2019, respectively.
+Added: SOLAR CAPITAL LTD.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
+Added: December 31, 2020
+Added: thousands, except share amounts)
Unsecured Notes
18 unchanged sentences
The 2022 Unsecured Notes were issued in a private placement only to qualified institutional buyers.
−Removed: SOLAR CAPITAL LTD.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
−Removed: December 31, 2019
−Removed: (in thousands, except share amounts)
−Removed: On November 8, 2016, the Company closed a private offering of $50,000 of the 2022
−Removed: Unsecured Notes with a fixed interest rate of 4.40% and a maturity date of May 8, 2022.
+Added: On November 8, 2016, the Company closed a private offering of $50,000 of the 2022 Unsecured Notes with a fixed interest rate of 4.40% and
+Added: a maturity date of May 8, 2022.
Interest on the 2022 Unsecured Notes is due semi-annually on May 8 and November 8.
−Removed: The 2022 Unsecured Notes were issued in a private placement
−Removed: only to qualified institutional buyers.
+Added: The 2022 Unsecured Notes were issued in a private placement only to qualified institutional buyers.
Revolving and Term Loan Facilities
1 unchanged sentence
secured credit agreement (the Credit Facility).
−Removed: The Credit Facility is composed of $470,000 of revolving credit and $75,000 of term loans.
−Removed: Borrowings generally bear interest at a rate per annum equal to the base rate plus a range of 2.00-2.25% or the alternate base rate plus 1.00%-1.25%.
+Added: The Credit Facility was originally composed of $470,000 of revolving credit and $75,000 of term loans.
+Added: On February 12, 2020, a new lender to the Company executed a commitment increase
+Added: to our Credit Facility providing for an additional $75,000 of revolving credit, bringing our Credit Facilitys total revolving credit capacity to $545,000.
+Added: Borrowings generally bear interest at a rate per annum equal to the base rate plus a
+Added: range of 2.00-2.25% or the alternate base rate plus 1.00%-1.25%.
The Credit Facility has no LIBOR floor requirement.
−Removed: The Credit Facility matures in August 2024 and includes ratable
−Removed: amortization in the final year.
+Added: The Credit Facility matures in August 2024 and
+Added: includes ratable amortization in the final year.
The Credit Facility may be increased up to $800,000 with additional new lenders or an increase in commitments from current lenders.
−Removed: The Credit Facility contains certain customary affirmative and negative covenants and
−Removed: events of default.
+Added: The Credit Facility contains certain customary affirmative and
+Added: negative covenants and events of default.
In addition, the Credit Facility contains certain financial covenants that among other things, requires the Company to maintain a minimum shareholders equity and a minimum asset coverage ratio.
−Removed: At December 31, 2019,
−Removed: outstanding USD equivalent borrowings under the Credit Facility totaled $117,900, composed of $42,900 of revolving credit and $75,000 of term loans.
−Removed: On May 31, 2019, the Company as transferor and SSLP 2016-1, LLC, a wholly-owned subsidiary of the
−Removed: Company, as borrower entered into amendment number two to the $200,000 SSLP Facility with Wells Fargo Bank, NA acting as administrative agent.
−Removed: The Company acted as servicer under the SSLP Facility.
−Removed: The SSLP Facility was scheduled to mature on
−Removed: May 31, 2024.
−Removed: The SSLP Facility generally bore interest at a rate of LIBOR plus 2.25%.
−Removed: The Company and SSLP 2016-1, LLC, as applicable, had made certain customary representations and warranties, and were
−Removed: required to comply with various covenants, including leverage restrictions, reporting requirements and other customary requirements for similar credit facilities.
−Removed: The SSLP Facility included usual and customary events of default for credit facilities
−Removed: of this nature.
−Removed: On October 31, 2019, the SSLP Facility was extinguished.
−Removed: On September 26, 2018, NEFPASS SPV LLC, a newly formed
−Removed: wholly-owned subsidiary of NEFPASS LLC, as borrower entered into a $50,000 senior secured revolving credit facility (the NEFPASS Facility) with Keybank acting as administrative agent.
−Removed: The Company acts as servicer under the NEFPASS
+Added: December 31, 2020, outstanding USD equivalent borrowings under the Credit Facility totaled $201,000, composed of $126,000 of revolving credit and $75,000 of term loans.
+Added: SOLAR CAPITAL LTD.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
+Added: December 31, 2020
+Added: thousands, except share amounts)
+Added: On September 26, 2018,
+Added: NEFPASS SPV LLC, a newly formed wholly-owned subsidiary of NEFPASS LLC, as borrower entered into a $50,000 senior secured revolving credit facility (the NEFPASS Facility) with Keybank acting as administrative agent.
+Added: The Company acts as
+Added: servicer under the NEFPASS Facility.
The NEFPASS Facility is scheduled to mature on September 26, 2023.
The NEFPASS Facility generally bears interest at a rate of LIBOR plus 2.15%.
−Removed: NEFPASS and NEFPASS SPV LLC, as applicable, have made certain customary representations
−Removed: and warranties, and are required to comply with various covenants, including leverage restrictions, reporting requirements and other customary requirements for similar credit facilities.
−Removed: The NEFPASS Facility also includes usual and customary events
−Removed: of default for credit facilities of this nature.
+Added: NEFPASS and NEFPASS SPV LLC, as applicable, have made certain
+Added: customary representations and warranties, and are required to comply with various covenants, including leverage restrictions, reporting requirements and other customary requirements for similar credit facilities.
+Added: The NEFPASS Facility also includes
+Added: usual and customary events of default for credit facilities of this nature.
There were $30,000 of borrowings outstanding as of December 31, 2020.
−Removed: covenants on our issued debt may restrict our business activities, including limitations that could hinder our ability to finance additional loans and investments or to make the distributions required to maintain our status as a RIC under Subchapter
−Removed: M of the Code.
−Removed: The Company has made an election to apply the fair value option of accounting to the 2022 Unsecured Notes, in accordance
−Removed: with ASC 825-10.
+Added: Certain covenants on our issued debt may restrict our business activities, including limitations that could hinder our ability to finance
+Added: additional loans and investments or to make the distributions required to maintain our status as a RIC under Subchapter M of the Code.
+Added: The Company has made an election to apply the fair value option of accounting to the 2022 Unsecured Notes, in accordance with ASC 825-10.
We believe accounting for this facility at fair value better aligns the measurement methodologies of assets and liabilities, which may mitigate certain earnings volatility.
−Removed: ASC 825-10 requires entities to display the fair value of the selected assets and liabilities on the face of the Consolidated Statement of Assets and Liabilities and changes in fair value of the above facility are
+Added: 825-10 requires entities to display the fair value of the selected assets and liabilities on the face of the Consolidated Statement of Assets and Liabilities and changes in fair value of the above facility are
reported in the Consolidated Statement of Operations.
1 unchanged sentence
December 31, 2020 and the year ended December 31, 2019 was 4.11% and 4.52%, respectively.
−Removed: These costs are exclusive of other credit facility
−Removed: SOLAR CAPITAL LTD.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
−Removed: December 31, 2019
−Removed: (in thousands, except share amounts)
−Removed: expenses such as unused fees, agency fees and other prepaid expenses related to establishing and/or amending the Credit Facility, the 2022 Unsecured Notes, the 2022 Tranche C Notes, the NEFPASS
−Removed: Facility, the SSLP Facility, the 2023 Unsecured Notes, the 2024 Unsecured Notes, and the 2026 Unsecured Notes (collectively the Credit Facilities), if any.
−Removed: The maximum amounts borrowed on the Credit Facilities during the year ended
−Removed: December 31, 2019 and the year ended December 31, 2018 were $616,186 and $592,600, respectively.
−Removed: Income Tax Information and
−Removed: Distributions to Stockholders
−Removed: The tax character of distributions for the fiscal years ended December 31, 2019, 2018 and 2017 were
−Removed: as follows (1):
+Added: These costs are exclusive of other credit facility expenses such as unused fees, agency fees and other prepaid expenses related to establishing
+Added: and/or amending the Credit Facility, the 2022 Unsecured Notes, the 2022 Tranche C Notes, the NEFPASS Facility, the 2023 Unsecured Notes, the 2024 Unsecured Notes, and the 2026 Unsecured Notes (collectively the Credit Facilities), if any.
+Added: The maximum amounts borrowed on the Credit Facilities during the year ended December 31, 2020 and the year ended December 31, 2019 were $677,000 and $616,186, respectively.
+Added: Income Tax Information and Distributions to Stockholders
+Added: The tax character of distributions for the fiscal years ended December 31, 2020, 2019 and 2018 were as follows (1):
Ordinary income
2 unchanged sentences
Total distributions
−Removed: As of December 31, 2019, 2018 and 2017 the total accumulated earnings (loss) on a tax basis were as
+Added: SOLAR CAPITAL LTD.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
+Added: December 31, 2020
+Added: thousands, except share amounts)
+Added: As of December 31, 2020,
+Added: 2019 and 2018 the total accumulated earnings (loss) on a tax basis were as follows (1):
Undistributed ordinary income
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Other Tax Information (unaudited)
−Removed: For the fiscal years ended December 31, 2019, 2018 and 2017, none of the distributions paid during the year were eligible for qualified
−Removed: dividend income treatment or the dividends received deduction for corporate stockholders.
−Removed: For the fiscal years ended December 31, 2019, 2018, and 2017, 83.81%, 89.69% and 89.25%, respectively, of each of the distributions paid during the year
−Removed: represent interest-related dividends.
+Added: For the fiscal years ended December 31, 2020, 2019 and 2018, 0.1%, 0.0% and 0.0%, respectively, of the dividends paid during the year were
+Added: eligible for qualified dividend income treatment and the dividends received deduction for corporate stockholders.
+Added: For the fiscal years ended December 31, 2020, 2019, and 2018, 92.05%, 83.81% and 89.69%, respectively, of each of the
+Added: distributions paid during the year represent interest-related dividends.
For the fiscal years ended December 31, 2020, 2019 and 2018, none of the distributions represent short-term capital gains dividends.
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December 31, 2020
−Removed: (in thousands, except share amounts)
+Added: thousands, except share amounts)
Financial Highlights
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Total return does not include a sales load.
−Removed: The ratio of operating expenses to average net assets and the ratio of total expenses to average net assets is
−Removed: shown net of a voluntary incentive fee waiver (see note 3).
−Removed: For the year ended December 31, 2015, the ratios of operating expenses to average net assets and total expenses to average net assets would be 4.02% and 5.70%, respectively, without
−Removed: the voluntary incentive fee waiver.
Ratios are shown without the non-recurring upfront costs that were
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December 31, 2020
−Removed: (in thousands, except share amounts)
+Added: thousands, except share amounts)
Crystal Financial LLC
13 unchanged sentences
As of December 31, 2020 Crystal Financial LLC had 30
−Removed: funded commitments to 28 different issuers with total funded loans of approximately $496,833 on total assets of $518,024.
+Added: funded commitments to 24 different issuers with a total par value of approximately $404,115 on total assets of $433,914.
As of December 31, 2019 Crystal Financial LLC had 35 funded commitments to 28 different issuers with total funded loans of
17 unchanged sentences
Net Increase (Decrease) In
+Added: Net Assets From
December 31, 2020
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December 31, 2020
−Removed: (in thousands, except share amounts)
+Added: thousands, except share amounts)
Commitments and Contingencies
The Company had unfunded debt and equity commitments to various revolving and delayed draw loans as well as to Crystal Financial LLC.
−Removed: amount of these unfunded commitments as of December 31, 2019 and December 31, 2018 is $124,529 and $169,667, respectively, comprised of the following:
+Added: The total amount of these unfunded commitments as of December 31, 2020 and December 31, 2019 is $126,180 and $124,529, respectively, comprised of the following:
Crystal Financial LLC*
−Removed: Kindred Biosciences, Inc.
−Removed: Rubius Therapeutics, Inc.
+Added: Smile Doctors LLC
+Added: Soleo Health Holdings, Inc.
Cardiva Medical, Inc.
+Added: Kindred Biosciences, Inc.
+Added: Neuronetics, Inc.
+Added: One Touch Direct, LLC
+Added: PQ Bypass, Inc.
+Added: NEF Holdings, Inc.
Centrexion Therapeutics, Inc.
+Added: Atria Wealth Solutions, Inc.
+Added: Sentry Data Systems, Inc.
+Added: Pinnacle Treatment Centers, Inc.
+Added: Delphinus Medical Technologies, Inc.
+Added: Basic Fun, Inc.
+Added: Rubius Therapeutics, Inc.
Cerapedics, Inc.
−Removed: PQ Bypass, Inc.
Phynet Dermatology LLC
6 unchanged sentences
Alimera Sciences, Inc.
−Removed: Atria Wealth Solutions, Inc.
−Removed: BioElectron Technology Corporation
−Removed: BAM Capital, LLC
−Removed: Tetraphase Pharmaceuticals, Inc.
−Removed: Corindus Vascular Robotics, Inc.
−Removed: Kingsbridge Holdings, LLC
−Removed: Breathe Technologies, Inc.
−Removed: GenMark Diagnostics, Inc.
−Removed: Delphinus Medical Technologies, Inc.
Total Commitments
8 unchanged sentences
December 31, 2020
−Removed: (in thousands, except share amounts)
−Removed: In the normal course of its business, we invest or trade in various financial instruments and
−Removed: may enter into various investment activities with off-balance sheet risk, which may include forward foreign currency contracts.
−Removed: Generally, these financial instruments represent future commitments to purchase
−Removed: or sell other financial instruments at specific terms at future dates.
−Removed: These financial instruments contain varying degrees of off-balance sheet risk whereby changes in the market value or our satisfaction of
−Removed: the obligations may exceed the amount recognized in our Consolidated Statements of Assets and Liabilities.
+Added: thousands, except share amounts)
NEF Holdings, LLC
18 unchanged sentences
and $128,150 of borrowings outstanding at December 31, 2020 and December 31, 2019, respectively.
−Removed: For the years ended December 31, 2019, 2018 and the period July 31, 2017 through December 31, 2017, NEF had net income
−Removed: (loss) of ($6,023), $3,426 and $4,703, respectively on gross income of $31,928, $30,044 and $15,568, respectively.
−Removed: Due to timing and non-cash items, there may be material differences between GAAP net income
−Removed: and cash available for distributions.
−Removed: NEFs consolidated financial statements for the fiscal years ended December 31, 2019 and December 31, 2018 are attached as an exhibit to this annual report on Form
−Removed: SOLAR CAPITAL LTD.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
−Removed: December 31, 2019
−Removed: (in thousands, except share amounts)
+Added: For the years ended December 31, 2020, 2019 and 2018, NEF had net income (loss) of ($8,883), ($6,023) and $3,426, respectively on gross
+Added: income of $24,512, $31,928 and $30,044, respectively.
+Added: Due to timing and non-cash items, there may be material differences between GAAP net income and cash available for distributions.
+Added: NEFs consolidated
+Added: financial statements for the fiscal years ended December 31, 2020 and December 31, 2019 are attached as an exhibit to this annual report on Form 10-K.
Capital Share Transactions
−Removed: As of December 31, 2019 and December 31, 2018, 200,000,000 shares of $0.01 par value capital stock were authorized.
−Removed: Transactions in capital stock were as follows:
+Added: of December 31, 2020 and December 31, 2019, 200,000,000 shares of $0.01 par value capital stock were authorized.
+Added: in capital stock were as follows:
+Added: December 31, 2020
+Added: December 31, 2019
+Added: December 31, 2020
+Added: December 31, 2019
Shares issued in reinvestment of distributions
Net increase (decrease)
+Added: SOLAR CAPITAL LTD.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
+Added: December 31, 2020
+Added: thousands, except share amounts)
+Added: Kingsbridge Holdings, LLC
+Added: On November 3, 2020, the Company acquired 87.5% of Kingsbridge Holdings, LLC (KBH) through KBH Topco LLC (KBHT), a
+Added: newly formed Delaware corporation.
+Added: KBH is a residual focused independent mid-ticket lessor of equipment primarily to U.S.
+Added: investment grade companies.
+Added: The Company invested $216,596 to effect the
+Added: transaction, of which $136,596 was invested to acquire 87.5% of KBHTs equity and $80,000 in KBHs debt.
+Added: The existing management team of KBH committed to continue to lead KBH after the transaction.
+Added: Post the transaction, the
+Added: Company owns 87.5% of KBHT equity and the KBH management team owns the remaining 12.5% of KBHTs equity.
+Added: As of December 31,
+Added: 2020, KBHT had total assets of $744,684.
+Added: KBHT also had recourse debt outstanding of $219,044 as well as non-recourse debt outstanding of $335,899.
+Added: For the period November 3, 2020 through
+Added: December 31, 2020, KBHT had net income of $2,170, on gross income of $43,618.
+Added: Due to timing and non-cash items, there may be material differences between GAAP net income and cash available for
+Added: distributions.
+Added: As such, and subject to fluctuations in KBHTs funded commitments, the timing of originations, and the repayments of financings, the Company cannot guarantee that KBHT will be able to maintain consistent dividend payments to us.
+Added: KBHTs consolidated financial statements for the period November 3, 2020 through December 31, 2020 are attached as an exhibit to this annual report on Form 10-K.
Subsequent Events
−Removed: The Company has evaluated the need for disclosures and/or adjustments resulting from subsequent events through the date the consolidated
−Removed: financial statements were issued.
−Removed: On February 12, 2020, a new lender to the Company executed a commitment increase to our Credit Facility
−Removed: providing for an additional $75,000 of revolving credit, bringing our Credit Facilitys total revolving credit capacity to $545,000.
+Added: has evaluated the need for disclosures and/or adjustments resulting from subsequent events through the date the consolidated financial statements were issued.
On February 24, 2021, our Board declared a quarterly distribution of $0.41 per share payable on April 2, 2021 to holders of record
2 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.