UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2020March 31, 2024

OR

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

Commission File Number: 000-56189814-01351

STEELE CREEK CAPITAL CORPORATION

Maryland85-1327288

(State or other jurisdiction of


incorporation or organization)

(I.R.S. Employer


Identification No.)

210 S. College Street, Suite 1690, Charlotte,


North Carolina

28244
(Address of principal executive offices)(Zip Code)

(704) 343-6011

(Registrant’s telephone number, including area code)

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

Title of each classTrading Symbol(s)Name of each exchange on which
registered
NoneNoneNone

Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.001 per share

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

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

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

Large accelerated filer☐Accelerated filer☐
Non-accelerated filer☒Smaller reporting company☐
Emerging growth company☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

As of December 23, 2020,May 10, 2024, the registrant had 2,633,227.766,354,912 shares of common stock, $0.001 par value per share, outstanding.

 

 

 

MSC Capital LLCSTEELE CREEK CAPITAL CORPORATION

Table of ContentsTABLE OF CONTENTS

PAGEPage
PART I. FINANCIAL INFORMATION
 1 
Item 1.Consolidated Financial Statements
 1
Consolidated StatementStatements of Assets and Liabilities as of September 30, 2020March 31, 2024 (unaudited) and December 31, 20231
 1
Consolidated StatementStatements of Operations for the period July 1, 2020 (commencement of operations) through September 30, 2020three months ended March 31, 2024 and 2023 (unaudited)2
 
Consolidated StatementStatements of Changes in Shareholders’ EquityNet Assets for the period July 1, 2020 (commencement of operations) through September 30, 2020three months ended March 31, 2024 and 2023 (unaudited)3
 
Consolidated StatementStatements of Cash Flows for the period July 1, 2020 (commencement of operations) through September 30, 2020three months ended March 31, 2024 and 2023 (unaudited)4
 
Consolidated ScheduleSchedules of Investments as of September 30, 2020March 31, 2024 (unaudited) and December 31, 20235
 
Notes to the Consolidated Financial Statements (unaudited)7
 28
Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations16
 41
Item 3.Quantitative and Qualitative Discussion aboutDisclosures About Market Risk26
 57
Item 4.Controls and Procedures27
 58
PART II. OTHER INFORMATION
 59
Item 1.Legal Proceedings28
 
Item 1a.Risk Factors28
 
Item 1.Legal Proceedings59
Item 1A.Risk Factors59
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds28
 59
Item 3.Defaults Upon Senior Securities28
 59
Item 4.Mine Safety Disclosures28
 59
Item 5.Other Information28
 
Item 5.Other Information59
Item 6.Exhibits29Exhibits60
Signatures61

i

 

MSC

Part I. Financial Information

Item 1. Consolidated Financial Statements

Steele Creek Capital LLCCorporation

Consolidated StatementStatements of Assets and Liabilities

(unaudited)(in thousands, except per share data)

 

  September 30,
2020		 
Assets   
Investments,   
Non-controlled/non-affiliate company investments, at fair value (amortized cost of $26,383,346) $26,726,554 
Cash  3,682,763 
Interest receivable  31,730 
Receivable for investments sold  23,240,920 
Total assets $53,681,967 
     
Liabilities    
Payable for investments purchased  29,608,335 
Accounts payable and accrued expenses  56,234 
Total liabilities  29,664,569 
     
Commitments and contingencies (Note 10)    
     
Shareholders’ Equity:    
Common shares, $1,000 par value, 22,828 shares authorized, issued and outstanding as of September 30, 2020  22,828,000 
Paid-in-capital in excess of par value  530,000 
Total distributable earnings  659,398 
Total shareholders’ equity $24,017,398 
     
Total liabilities and shareholders’ equity $53,681,967 
     
Net asset value per share $1,052.10 
  March 31,
2024		  December 31,
2023		 
  (unaudited)    
Assets      
Investments:      
Non-controlled/non-affiliated company investments, at fair value (amortized cost of $145,405 and $142,333, respectively) $140,676  $138,533 
Cash  10,552   9,325 
Receivable for investments sold  30,772   32,451 
Prepaid expenses and other assets  294   339 
Interest receivable  693   744 
Total assets $182,987  $181,392 
         
Liabilities        
Credit facility  83,136   86,316 
Payable for investments purchased  36,534   30,188 
Management fees payable  349   344 
Interest payable  47   50 
Incentive fees payable  56   80 
Accounts payable and accrued expenses  513   475 
Distributions payable  1,233   2,081 
Total liabilities  121,868   119,534 
         
Commitments and contingencies (Note 8)        
         
Net Assets:        
Common shares, $0.001 par value, 6,390,590 shares authorized and 6,390,590 and 6,370,722 shares issued and outstanding, respectively $6  $6 
Paid-in-capital in excess of par value  67,609   67,420 
Total distributable (deficit)  (6,496)  (5,568)
Total net assets $61,119  $61,858 
         
Total liabilities and net assets $182,987  $181,392 
         
Net asset value per share $9.56  $9.71 

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


1

MSC

Steele Creek Capital LLCCorporation

Consolidated StatementStatements of Operations

(unaudited)

(in thousands, except per share data)

  Three months
ended
March 31,
2024		  Three months
ended
March 31,
2023		 
       
Investment income:      
Non-controlled/non-affiliated company investments:      
Interest income $3,449  $3,199 
Payment in-kind interest income  4   18
Other income  8   - 
Total investment income  3,461   3,217 
         
Expenses:        
Management fees  455   372 
Interest and debt financing expenses  1,485   1,302 
Professional fees  99   95 
Incentive fees  56   76 
Administration expenses  60   58 
Directors’ fees  20   20 
Custody fees  12   12 
Other general and administrative expenses  159   119 
Total expenses  2,346   2,054 
Less: management fees waived  (106)  (52)
Less: incentive fees waived  -   (8)
Net expenses  2,240   1,994 
Net investment income  1,221   1,223 
         
Realized and unrealized (loss) gain on investments:        
Net realized (loss) gain on non-controlled/non-affiliated company investments  13   (418)
Net change in unrealized (depreciation) appreciation on non-controlled/non-affiliated company investments  (929)  1,666 
         
Total net realized and unrealized (loss) gain on investments  (916)  1,248 
         
Net (decrease) increase in net assets resulting from operations $305  $2,471 
         
Per share data:        
Net investment income per share - basic and diluted $0.19  $0.21 
Net (decrease) increase in net assets resulting from operations per share - basic and diluted $0.05  $0.43 
Weighted average shares outstanding - basic and diluted  6,344   5,692 

 

For the
period from
July 1,
2020
(commencement of operations) through
September 30,
2020
Investment income:
Non-controlled/non-affiliate company investments:
Interest income$211,354
Other income11,088
Total investment income222,442
Expenses:
Professional fees106,250
Custody fees8,014
Administration expenses3,014
Other general and administrative expenses3,110
Total expenses120,388
Net investment income102,054
Realized and unrealized gain (loss) on investments:
Net realized gain on non-controlled/non-affiliate company investments214,136
Net change in unrealized appreciation on non-controlled/non-affiliate company investments343,208
Total net realized and unrealized gain on investments557,344
Net increase in shareholders’ equity resulting from operations$659,398
Per share data:
Net investment income per share - basic and diluted$6.51
Net increase in shareholders’ equity resulting from operations per share - basic and diluted$42.05
Weighted average shares outstanding - basic and diluted15,681

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


2

MSC

Steele Creek Capital LLCCorporation

Consolidated StatementStatements of Changes in Shareholders’ EquityNet Assets

(unaudited)

(in thousands, except per share data)

  Three months
ended
March 31,
2024		  Three months
ended
March 31,
2023		 
Operations      
Net investment income $1,221  $1,223 
Net realized (loss) gain on investments  13   (418)
Net change in unrealized appreciation (depreciation) on investments  (929)  1,666 
Net increase (decrease) in net assets resulting from operations  305   2,471 
         
Distributions to Stockholders        
Distributions of realized income  (1,233)  (1,067)
         
Capital Share Transactions        
Issuance of common shares  713   615 
Repurchase of common shares  (524)  - 
Total Capital Share Transactions  189   615 
         
Net Assets        
Net increase (decrease) in net assets during the period  (739)  2,019 
Net assets at beginning of period  61,858   50,375 
Net assets at end of period  61,119   52,394 
         
Capital Share Activity        
Issuance of common shares  74   67 
Repurchase of common shares  (54)  - 
Shares issued and outstanding at beginning of period  6,371   5,643 
Shares issued and outstanding at end of period  6,391   5,710 

 

  Common Stock  Paid-in capital in  Distributable  Total 
  Number of shares  Par value  excess of par value  Earnings (Loss)  shareholders’ equity 
Balances at July 1, 2020 (commencement of operations)  -  $-  $-  $-  $- 
                     
Net investment income  -   -   -   102,054   102,054 
                     
Net realized gain on investments  -   -   -   214,136   214,136 
                     
Net change in unrealized appreciation on investments  -   -   -   343,208   343,208 
                     
Issuance of common shares  22,828   22,828,000   530,000   -   23,358,000 
                     
Balances at September 30, 2020  22,828  $22,828,000  $530,000  $659,398  $24,017,398 

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


3

MSC

Steele Creek Capital LLCCorporation

Consolidated StatementStatements of Cash Flows

(unaudited)

(in thousands, except per share data)

  Three months
ended
March 31,
2024		  Three months
ended
March 31,
2023		 
Cash flows from operating activities:      
Net increase (decrease) in net assets resulting from operations $305  $2,471 
         
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities        
Purchase of investments (1)  (92,086)  (49,931)
Proceeds from sales of investments and paydowns (1)  89,108   50,480 
Payment in-kind interest income  (4)  (18)
Amortization of premium/accretion of discount, net  (77)  (119)
Net realized loss (gain) on investments  (13)  418 
Net change in unrealized depreciation (appreciation) on investments  929   (1,666)
Changes in operating assets and liabilities:        
Receivable for investments sold  1,679   7,801 
Prepaid expenses and other assets  45   58 
Interest receivable  51   (298)
Payable for investments purchased  6,346   (5,237)
Management fees payable  5   1 
Interest payable  (3)  (13)
Incentive fees payable  (24)  43 
Accounts payable and accrued expenses  38   (90)
Net cash provided by (used in) operating activities  6,299   3,900 
         
Cash flows from financing activities:        
Proceeds from issuance of common shares  713   615 
Repurchase of common shares  (524)  - 
Proceeds from issuance of debt  1,820   750 
Repayments on debt  (5,000)  (2,000)
Stockholder distributions paid  (2,081)  (1,357)
Net cash (used in) provided by financing activities  (5,072)  (1,992)
         
Net increase in Cash  1,227   1,908 
Cash, beginning of period  9,325   4,693 
Cash, end of period $10,552  $6,601 
         
Supplemental disclosure of Cash Flow Information:        
Operating Activities:        
Interest paid $1,488  $1,316 

 

  For the
period from
July 1,
2020
(commencement of operations) through
September 30,
2020		 
Cash flows from operating activities:    
Net increase in shareholder’s equity resulting from operations $659,398 
     
Adjustments to reconcile net increase in shareholder’s equity resulting from operations to net cash provided by (used in) operating activities    
Purchase of investments  (69,071,588)
Proceeds from sales of investments and paydowns  45,806,471 
Amortization of premium/accretion of discount, net  (45,811)
Net realized gain on investments  (214,136)
Net change in unrealized appreciation on investments  (343,208)
Changes in operating assets and liabilities:    
Interest receivable  (31,730)
Receivable for investments sold  (23,240,920)
Payable for investments purchased  29,608,335 
Accounts payable and accrued expenses  56,234 
Net cash used in operating activities  (16,816,955)
     
Cash flows from financing activities:    
Proceeds from issuance of common shares  20,499,718 
Net cash provided by financing activities  20,499,718 
     
Net increase in Cash  3,682,763 
Cash, beginning of period  - 
Cash, end of period $3,682,763 
     
Supplemental disclosure:    
Operating activities:    
Contribution of loan investments $2,858,282 
     
Financing activities:    
Contribution of loan investments from Members $2,858,282 
(1)Of the amount reported for the three months ended March 31, 2024, $710 thousand, represent non-cash transactions. Of the amount reported for the three months ended March 31, 2023, there are no non-cash transactions.

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


4

MSC

Steele Creek Capital LLCCorporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) (2)  Maturity Interest Rate (3)  Basis Point
Spread Above
Index (3)		 Interest Rate
Floor / Base
Rate (3)		  Par Amount  Amortized Cost  Fair Value  % of Net
Shareholder’s
Equity (4)		 
Non-controlled/Non-Affiliate Investments                           
                            
Term Floating Rate Loans - 111.3% of Shareholder’s Equity (4)                           
                            
Aerospace & Defense                           
Alion Science and Technology Corporation 7/23/2024 4.75% L + 3.75% 1.00% $1,000,000  $990,156  $1,004,585   4.2%
MAG DS Corp 4/1/2027 6.50% L + 5.50% 1.00%  1,000,000   950,000   955,625   4.0%
Milano Acquisition Corporation 10/1/2027 4.75% L + 4.00% 0.75%  1,000,000   990,000   991,875   4.1%
Spirit Aerosystems Inc. 1/15/2025 6.00% L + 5.25% 0.75%  500,000   497,500   500,000   2.1%
Total Aerospace & Defense                 3,427,656   3,452,085   14.4%
                            
Automotive                           
NN, Inc. 10/19/2022 6.50% L + 5.75% 0.75%  1,640,161   1,551,502   1,626,539   6.8%
Total Automotive                 1,551,502   1,626,539   6.8%
                            
Banking, Finance, Insurance & Real Estate                           
Broadstreet Partners, Inc. 1/27/2027 4.75% L + 3.75% 1.00%  997,500   978,370   990,019   4.1%
FinCo I LLC 6/27/2025 2.65% L + 2.50% 0.15%  500,000   498,750   498,230   2.1%
Hudson River Trading LLC 2/18/2027 3.14% L + 3.00% 0.14%  997,487   985,237   977,538   4.1%
Ryan Specialty Group LLC 9/1/2027 4.00% L + 3.25% 0.75%  1,000,000   985,163   992,505   4.1%
Total Banking, Finance, Insurance & Real Estate                 3,447,520   3,458,292   14.4%
                            
Beverage, Food & Tobacco                           
Advantage Sales & Marketing Inc. 7/23/2021 4.25% L + 3.25% 1.00%  1,488,462   1,374,913   1,465,576   6.1%
Total Beverage, Food & Tobacco                 1,374,913   1,465,576   6.1%
                            
Chemicals, Plastics, & Rubber                           
Aruba Investments, Inc. 7/7/2025 5.25% L + 4.25% 1.00%  1,000,000   988,674   997,080   4.2%
Total Chemicals, Plastics, & Rubber                 988,674   997,080   4.2%
                            
Containers, Packaging & Glass                           
Canister International Group Inc. 12/21/2026 4.90% L + 4.75% 0.15%  500,000   497,500   500,000   2.1%
Plaze, Inc. 8/3/2026 5.25% L + 4.25% 1.00%  1,000,000   985,256   987,500   4.1%
Pro Mach Group, Inc. 3/7/2025 4.50% L + 3.50% 1.00%  265,031   (12,785)  7,951   0.0%
Pro Mach Group, Inc. 3/7/2025 4.50% L + 3.50% 1.00%  802,957   777,081   786,898   3.3%
Total Containers, Packaging & Glass                 2,247,052   2,282,349   9.5%
                            
Energy: Electricity                           
Hamilton Projects Acquiror LLC 6/17/2027 5.75% L + 4.75% 1.00%  997,500   977,901   996,877   4.2%
Total Energy: Electricity                 977,901   996,877   4.2%
                            
Energy: Oil & Gas                           
ChampionX Holding Inc. 6/3/2027 6.00% L + 5.00% 1.00%  987,500   977,653   985,031   4.1%
Total Energy: Oil & Gas                 977,653   985,031   4.1%
                            
Forest Products & Paper                           
Neenah, Inc. 6/30/2027 5.00% L + 4.00% 1.00%  997,500   978,044   997,500   4.2%
Total Forest Products & Paper                 978,044   997,500   4.2%
                            
Healthcare & Pharmaceuticals                           
Global Medical Response, Inc. 10/2/2025 5.75% L + 4.75% 1.00%  500,000   490,000   489,688   2.0%
Lannett Company, Inc. 11/25/2022 6.38% L + 5.38% 1.00%  1,047,721   1,037,813   1,032,006   4.3%
Total Healthcare & Pharmaceuticals                 1,527,813   1,521,694   6.3%
                            
High Tech Industries                           
Casa Systems, Inc. 12/20/2023 5.00% L + 4.00% 1.00%  481,250   455,716   458,691   1.9%
LogMeIn, Inc. 8/31/2027 4.91% L + 4.75% 0.16%  1,000,000   975,207   968,440   4.0%
Total High Tech Industries                 1,430,923   1,427,131   5.9%
                            
Media: Advertising, Printing & Publishing                           
Meredith Corporation 1/31/2025 5.25% L + 4.25% 1.00%  997,500   959,334   986,692   4.1%
Total Media: Advertising, Printing & Publishing                 959,334   986,692   4.1%
                            
Media: Broadcasting & Subscription                           
Univision Communications Inc. 3/13/2026 4.75% L + 3.75% 1.00%  498,750   471,921   486,862   2.0%
Total Media: Broadcasting & Subscription                 471,921   486,862   2.0%
                            
Retail                           
Michaels Stores, Inc. 10/1/2027 4.25% L + 3.50% 0.75%  1,000,000   985,000   977,500   4.1%
Total Retail                 985,000   977,500   4.1%

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

 


Description (1) Investment
Type		 Maturity Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		 Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Non-controlled/Non-Affiliated Investments -230.2% of Shareholder’s Equity (4)                        
Investments made in the United States                        
Aerospace & Defense                        
Amentum Government Services Holdings LLC First Lien - Term Loan 2/15/2029  9.33% S + 4.00%  5.33%  851  $848  $854   1.4%
Barnes Group Inc. (5) First Lien - Term Loan 9/3/2030  7.83% S + 2.50%  5.33%  995   995   998   1.6%
HDT Holdco, Inc. First Lien - Term Loan 7/8/2027  11.32% S + 6.01%  5.31%  502   492   303   0.5%
KBR, Inc. (5) First Lien – Term Loan 1/17/2031  7.58% S + 2.25%  5.33%  211   211   212   0.4%
LSF11 Trinity Bidco, Inc. First Lien – Term Loan 6/14/2030  9.33% S + 4.00%  5.33%  489   482   492   0.8%
MAG DS Corp. First Lien – Term Loan 4/1/2027  10.90% S + 5.60%  5.30%  913   887   877   1.4%
Peraton Corp. First Lien – Term Loan 2/1/2028  9.18% S + 3.85%  5.33%  949   947   950   1.6%
Vertex Aerospace Services Corp. First Lien – Term Loan 12/6/2028  8.68% S + 3.35%  5.33%  980   977   983   1.6%
Total Aerospace & Defense                    5,839   5,669   9.3%
                               
Automotive                              
Adient US LLC First Lien – Term Loan 1/31/2031  8.08% S + 2.75%  5.33%  95   95   95   0.1%
Autokiniton US Holdings, Inc. First Lien – Term Loan 4/6/2028  9.44% S + 4.11%  5.33%  965   960   969   1.6%
First Brands Group, LLC First Lien – Term Loan 3/30/2027  10.57% S + 5.26%  5.31%  315   313   316   0.5%
First Brands Group, LLC First Lien – Term Loan 3/30/2027  10.57% S + 5.26%  5.31%  762   762   765   1.3%
Holley Inc. (5) First Lien – Term Loan 11/17/2028  9.19% S + 3.86%  5.33%  901   902   893   1.5%
Phinia Inc. (5) First Lien – Term Loan 7/3/2028  12.60% S + 4.10%  8.50%  498   480   498   0.8%
Thor Industries, Inc. (5) First Lien – Term Loan 11/15/2030  8.08% S + 2.75%  5.33%  750   747   753   1.2%
Total Automotive                    4,259   4,289   7.0%
                               
Banking, Finance, Insurance & Real Estate                              
AmWINS Group, Inc. First Lien – Term Loan 2/19/2028  8.18% S + 2.85%  5.33%  494   490   495   0.8%
AssuredPartners, Inc. First Lien – Term Loan 2/12/2027  8.83% S + 3.50%  5.33%  980   979   982   1.6%
Baldwin Risk Partners, LLC First Lien – Term Loan 10/14/2027  8.94% S + 3.61%  5.33%  744   739   745   1.2%
Citadel Securities LP First Lien – Term Loan 7/29/2030  7.58% S + 2.25%  5.33%  1,444   1,434   1,445   2.4%
Cushman & Wakefield U.S. Borrower, LLC (5) First Lien – Term Loan 1/31/2030  8.68% S + 3.35%  5.33%  496   488   495   0.8%
DRW Holdings, LLC First Lien – Term Loan 3/1/2028  9.19% S + 3.86%  5.33%  526   524   526   0.9%

MSC

5

Steele Creek Capital LLCCorporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) (2)  Maturity Interest Rate (3)  Basis Point
Spread Above
Index (3)		 Interest Rate
Floor / Base
Rate (3)		  Par Amount  Amortized Cost  Fair Value  % of Net
Shareholder’s
Equity (4)		 
Services: Business                           
iQor US Inc. 12/10/2020 11.00% L + 10.00% 1.00%  405,725   397,651   381,382   1.6%
Total Services: Business                 397,651   381,382   1.6%
                            
Services: Consumer                           
Herschend Entertainment Co LLC 8/25/2025 6.75% L + 5.75% 1.00%  500,000   480,316   482,500   2.0%
Smart Start, Inc. 8/19/2027 5.75% L + 4.75% 1.00%  1,000,000   990,125   1,002,710   4.2%
Total Services: Consumer                 1,470,441   1,485,210   6.2%
                            
Telecommunications                           
Avaya Inc. (5) 12/15/2024 4.40% L + 4.25% 0.15%  -   609   -   0.0%
Total Telecommunications                 609   -   0.0%
                            
Transportation: Cargo                           
SMB Shipping Logistics, LLC 2/2/2024 5.00% L + 4.00% 1.00%  733,671   694,254   704,324   2.9%
Wabash National Corporation 9/28/2027 4.00% L + 3.25% 0.75%  1,000,000   990,000   996,250   4.1%
Total Transportation: Cargo                 1,684,254   1,700,574   7.0%
                            
Transportation: Consumer                           
SkyMiles IP Ltd. 10/20/2027 4.75% L + 3.75% 1.00%  1,000,000   990,000   1,008,575   4.2%
Total Transportation: Consumer                 990,000   1,008,575   4.2%
                            
Utilities: Electric                           
PG&E Corporation 6/23/2025 5.50% L + 4.50% 1.00%  498,750   494,485   489,605   2.0%
Total Utilities: Electric                 494,485   489,605   2.0%
                            
Total Term Floating Rate Loans                 26,383,346   26,726,554   111.3%
                            
Total Non-controlled/Non-Affiliate Investments                $26,383,346  $26,726,554   111.3%

 

Description (1) Investment
Type		 Maturity  Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		  Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
FinCo I LLC First Lien – Term Loan  6/27/2029   8.31%  S + 3.00%   5.31%  744   741   747   1.2%
Greystar Real Estate Partners, LLC (5) First Lien – Term Loan  8/21/2030   8.58%  S + 3.25%   5.33%  525   518   527   0.9%
Guggenheim Partners Investment Management Holdings, LLC First Lien – Term Loan  12/12/2029   8.55%  S + 3.25%   5.30%  113   111   113   0.2%
Jane Street Group, LLC First Lien – Term Loan  1/26/2028   7.94%  S + 2.61%   5.33%  972   968   974   1.6%
Lakeview Loan Servicing, LLC (5) First Lien – Term Loan  6/21/2029   8.74%  S + 3.36%   5.38%  998   993   993   1.6%
LendingTree, Inc. (5) First Lien – Term Loan  9/15/2028   9.19%  S + 3.86%   5.33%  1,478   1,477   1,400   2.3%
OFSBS 2022-11A (5) Collateralized Loan Obligation  10/18/2035   8.83%  S + 3.50%   5.33%  1,000   1,000   1,010   1.7%
OFSI BSL CLO XII, Ltd. Collateralized Loan Obligation  1/20/2035   14.17%  S + 8.85%   5.32%  1,000   983   1,019   1.7%
ONBE, Inc. First Lien – Term Loan  12/10/2027   11.94%  S + 6.61%   5.33%  800   780   804   1.3%
Osaic Holdings, Inc. (5) First Lien – Term Loan  8/17/2028   9.83%  S + 4.50%   5.33%  467   463   469   0.8%
Osaic Holdings, Inc. (5) First Lien – Term Loan  8/17/2028   9.32%  S + 4.00%   5.32%  211   210   212   0.3%
Paysafe Group Holdings II Limited First Lien – Term Loan  6/28/2028   8.19%  S + 2.86%   5.33%  976   953   971   1.6%
Resolute Investment Managers, Inc. First Lien – Term Loan  4/30/2027   12.07%  S + 6.76%   5.31%  453   453   448   0.7%
Resolute Investment Managers, Inc. (4) Equity  —   —   —   —   6   —   —   0.0%
Russell Investments US Institutional Holdco, Inc. First Lien – Term Loan  5/30/2025   8.93%  S + 3.60%   5.33%  1,558   1,551   1,497   2.5%
Ryan Specialty Group, LLC First Lien – Term Loan  9/1/2027   8.08%  S + 2.75%   5.33%  485   486   486   0.8%
Sound Point CLO Ltd Collateralized Loan Obligation  7/26/2036   14.13%  S + 8.81%   5.32%  500   469   511   0.8%
Total Banking, Finance, Insurance & Real Estate                        16,810   16,869   27.7%
                                   
Beverage, Food & Tobacco                                  
Flynn Restaurant Group LP First Lien – Term Loan  12/1/2028   9.69%  S + 4.36%   5.33%  746   741   749   1.2%
Total Beverage, Food & Tobacco                        741   749   1.2%
                                   
Capital Equipment                                  
Chart Industries, Inc. First Lien – Term Loan  3/15/2030   8.67%  S + 3.35%   5.32%  913   909   917   1.5%
Novae LLC First Lien – Term Loan  12/22/2028   10.48%  S + 5.00%   5.48%  584   560   581   1.0%
Watlow Electric Manufacturing Company First Lien – Term Loan  3/2/2028   9.33%  S + 3.75%   5.58%  809   805   812   1.3%
Total Capital Equipment                        2,274   2,310   3.8%

6

Steele Creek Capital Corporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		 Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Chemicals, Plastics, & Rubber                        
Albaugh, LLC First Lien – Term Loan 4/6/2029  9.06% S + 3.75%  5.31%  1,195   1,187   1,162   1.9%
Bakelite US Holdco, Inc. First Lien – Term Loan 5/29/2029  9.46% S + 4.15%  5.31%  983   978   985   1.6%
DCG Acquisition Corp. First Lien – Term Loan 9/30/2026  9.93% S + 4.60%  5.33%  257   257   258   0.4%
H.B. Fuller Company (5) First Lien – Term Loan 2/15/2030  7.33% S + 2.00%  5.33%  423   423   425   0.7%
Koppers Inc. First Lien – Term Loan 4/10/2030  8.32% S + 3.00%  5.32%  147   147   148   0.3%
Sparta U.S. Holdco LLC First Lien – Term Loan 8/2/2028  8.69% S + 3.36%  5.32%  489   487   490   0.8%
Tronox Finance LLC First Lien – Term Loan 8/16/2028  8.83% S + 3.50%  5.33%  998   989   1,000   1.6%
Total Chemicals, Plastics, & Rubber                    4,468   4,468   7.3%
                               
Construction & Building                              
84 Lumber Company First Lien – Term Loan 11/29/2030  8.18% S + 2.85%  5.33%  349   348   351   0.6%
American Builders & Contractors Supply Co., Inc. First Lien – Term Loan 1/31/2031  7.33% S + 2.00%  5.33%  211   211   211   0.3%
APi Group DE, Inc. (5) First Lien – Term Loan 1/3/2029  7.94% S + 2.61%  5.33%  646   646   648   1.1%
Columbus McKinnon Corporation First Lien – Term Loan 5/14/2028  7.81% S + 2.50%  5.31%  666   662   669   1.1%
Core & Main LP First Lien – Term Loan 2/9/2031  7.56% S + 2.25%  5.31%  701   698   702   1.1%
Crown Subsea Communications Holding, Inc. First Lien – Term Loan 1/30/2031  10.07% S + 4.75%  5.32%  528   523   532   0.9%
Janus International Group, LLC First Lien – Term Loan 8/3/2030  8.62% S + 3.35%  5.27%  630   624   633   1.0%
Quikrete Holdings, Inc. First Lien – Term Loan 3/25/2031  7.82% S + 2.50%  5.32%  3,716   3,707   3,722   6.1%
Smyrna Ready Mix Concrete, LLC First Lien – Term Loan 4/2/2029  8.83% S + 3.50%  5.33%  638   623   643   1.1%
Summit Materials, LLC First Lien – Term Loan 1/12/2029  7.83% S + 2.50%  5.33%  105   105   106   0.2%
TAMKO Building Products LLC First Lien – Term Loan 9/20/2030  8.83% S + 3.50%  5.33%  995   991   996   1.6%
Total Construction & Building                    9,138   9,213   15.1%
                               
Consumer Goods: Durable                              
Hunter Douglas Holding B.V. First Lien – Term Loan 2/26/2029  8.82% S + 3.50%  5.32%  983   979   973   1.6%
LHS Borrower, LLC First Lien – Term Loan 2/16/2029  10.18% S + 4.85%  5.33%  652   647   624   1.0%
Mannington Mills, Inc. First Lien – Term Loan 8/6/2026  9.32% S + 4.01%  5.31%  384   384   367   0.6%
Pelican Products, Inc. First Lien – Term Loan 12/29/2028  9.81% S + 4.51%  5.30%  712   711   665   1.1%
Total Consumer Goods: Durable                    2,721   2,629   4.3%
                               
Consumer Goods: Non-Durable                              
Conair Holdings LLC First Lien – Term Loan 5/17/2028  9.19% S + 3.86%  5.33%  824   821   818   1.3%
Total Consumer Goods: Non-Durable                    821   818   1.3%
                               
Containers, Packaging & Glass                              
Closure Systems International Group Inc. First Lien – Term Loan 3/13/2029  9.43% S + 4.10%  5.33%  750   746   752   1.2%
Pactiv Evergreen Inc. (5) First Lien – Term Loan 9/24/2028  8.58% S + 3.25%  5.33%  977   957   982   1.6%

7

Steele Creek Capital Corporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		 Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Plaze, Inc. First Lien – Term Loan 8/3/2026  9.19% S + 3.86%  5.33%  652   647   644   1.1%
Sabert Corporation First Lien – Term Loan 12/10/2026  9.18% S + 3.86%  5.32%  785   784   788   1.3%
Total Containers, Packaging & Glass                    3,134   3,166   5.2%
                               
Energy: Electricity                              
Astoria Energy LLC First Lien – Term Loan 12/10/2027  8.94% S + 3.61%  5.33%  906   904   909   1.5%
Hamilton Projects Acquiror, LLC First Lien – Term Loan 6/17/2027  9.94% S + 4.61%  5.33%  725   710   729   1.2%
Invenergy Thermal Operating I LLC First Lien – Term Loan 8/14/2029  9.67% S + 4.36%  5.31%  821   806   825   1.3%
Invenergy Thermal Operating I LLC First Lien – Term Loan 8/14/2029  9.67% S + 4.36%  5.31%  71   70   72   0.1%
Vistra Operations Company LLC First Lien – Term Loan 12/20/2030  7.33% S + 2.00%  5.33%  843   836   843   1.4%
Total Energy: Electricity                    3,326   3,378   5.5%
                               
Energy: Oil & Gas                              
AL NGPL Holdings, LLC First Lien – Term Loan 4/13/2028  8.58% S + 3.25%  5.33%  644   647   646   1.1%
BCP Renaissance Parent L.L.C. First Lien – Term Loan 10/31/2028  8.83% S + 3.50%  5.33%  186   185   186   0.3%
CQP Holdco LP First Lien – Term Loan 12/31/2030  8.30% S + 3.00%  5.30%  726   724   729   1.2%
GIP Pilot Acquisition Partners, L.P. First Lien – Term Loan 10/4/2030  8.33% S + 3.00%  5.33%  211   210   212   0.3%
ITT Holdings LLC First Lien – Term Loan 10/5/2030  8.68% S + 3.35%  5.33%  680   667   682   1.1%
WhiteWater DBR Holdco LLC First Lien – Term Loan 3/3/2031  8.05% S + 2.75%  5.30%  441   439   442   0.7%
Total Energy: Oil & Gas                    2,872   2,897   4.7%
                               
Environmental Industries                              
Clean Harbors, Inc. (5) First Lien – Term Loan 10/8/2028  7.19% S + 1.86%  5.33%  527   526   528   0.9%
Total Environmental Industries                    526   528   0.9%
                               
Forest Products & Paper                              
Mativ Holdings, Inc. (5) First Lien – Term Loan 4/20/2028  9.19% S + 3.86%  5.33%  433   430   433   0.7%
Total Forest Products & Paper                    430   433   0.7%
                               
Healthcare & Pharmaceuticals                              
Amneal Pharmaceuticals LLC (5) First Lien – Term Loan 5/4/2028  10.83% S + 5.50%  5.33%  983   934   983   1.6%
ANI Pharmaceuticals, Inc. (5) First Lien – Term Loan 11/19/2027  11.44% S + 6.11%  5.33%  978   969   980   1.6%
Athletico Management, LLC First Lien – Term Loan 2/15/2029  9.70% S + 4.40%  5.30%  246   239   185   0.3%
Aveanna Healthcare LLC (5) First Lien – Term Loan 7/17/2028  9.19% S + 3.85%  5.34%  423   423   408   0.7%
Bayou Intermediate II, LLC First Lien – Term Loan 8/2/2028  10.08% S + 4.76%  5.32%  708   706   704   1.2%
Carestream Dental Technology Parent Limited First Lien – Term Loan 9/1/2024  9.81% S + 4.50%  5.31%  888   885   777   1.3%
Charlotte Buyer, Inc. First Lien – Term Loan 2/11/2028  10.57% S + 5.25%  5.32%  497   488   500   0.8%

8

Steele Creek Capital Corporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity  Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		  Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Confluent Health, LLC First Lien – Term Loan  11/30/2028   9.44%  S + 4.11%   5.33%  941   939   931   1.5%
Embecta Corp. (5) First Lien – Term Loan  3/30/2029   8.33%  S + 3.00%   5.33%  1,496   1,444   1,390   2.3%
Ensemble RCM, LLC First Lien – Term Loan  8/1/2029   8.32%  S + 3.00%   5.32%  943   938   946   1.6%
FC Compassus, LLC First Lien – Term Loan  12/31/2026   9.69%  S + 4.36%   5.33%  1,212   1,211   1,191   1.9%
Global Medical Response, Inc. First Lien – Term Loan  10/2/2025   9.84%  S + 4.51%   5.33%  484   480   453   0.7%
Golden State Buyer, Inc. First Lien – Term Loan  6/21/2026   10.18%  S + 4.85%   5.33%  938   934   929   1.6%
HAH Group Holding Company LLC First Lien – Term Loan  10/29/2027   10.44%  S + 5.00%   5.44%  993   981   991   1.6%
HAH Group Holding Company LLC First Lien – Delayed Draw Loan  10/29/2027   10.44%  S + 5.00%   5.44%  126   124   125   0.2%
Ingenovis Health, Inc. First Lien – Term Loan  3/6/2028   9.19%  S + 3.75%   5.44%  970   967   879   1.5%
Iqvia Inc. First Lien – Term Loan  1/2/2031   7.31%  S + 2.00%   5.31%  249   249   251   0.4%
Onex TSG Intermediate Corp. First Lien – Term Loan  2/28/2028   10.32%  S + 5.01%   5.31%  973   961   974   1.6%
PDS Holdco, Inc. First Lien – Term Loan  8/18/2028   10.10%  S + 4.76%   5.34%  1,330   1,326   827   1.4%
PDS Holdco, Inc. First Lien – Delayed Draw Loan  8/18/2028   10.10%  S + 4.76%   5.34%  136   136   84   0.1%
Phoenix Guarantor Inc. First Lien – Term Loan  2/21/2031   8.58%  S + 3.25%   5.33%  1,000   990   988   1.6%
Select Medical Corporation (5) First Lien – Term Loan  3/6/2027   8.33%  S + 3.00%   5.33%  101   100   101   0.2%
Sotera Health Holdings, LLC (5) First Lien – Term Loan  12/11/2026   9.08%  S + 3.75%   5.33%  218   213   218   0.4%
TTF Holdings, LLC First Lien – Term Loan  3/31/2028   9.44%  S + 4.11%   5.33%  635   632   636   1.0%
U.S. Anesthesia Partners, Inc. First Lien – Term Loan  10/1/2028   9.69%  S + 4.36%   5.33%  1,086   1,082   1,040   1.7%
US Radiology Specialists, Inc. (US Outpatient Imaging Services, Inc.) First Lien – Term Loan  12/15/2027   10.70%  S + 5.40%   5.30%  978   973   980   1.6%
Waystar Technologies, Inc. First Lien – Term Loan  10/22/2029   9.33%  S + 4.00%   5.33%  300   300   301   0.5%
Zelis Cost Management Buyer, Inc. First Lien – Term Loan  9/28/2029   8.08%  S + 2.75%   5.33%  633   630   634   1.0%
Total Healthcare & Pharmaceuticals                        20,254   19,406   31.9%
                                   
High Tech Industries                                  
Boxer Parent Company Inc. First Lien – Term Loan  12/29/2028   9.58%  S + 4.25%   5.33%  617   618   622   1.0%
Casa Systems, Inc. (4) (6) First Lien – Term Loan  12/20/2027   —   —   —   1,231   1,231   184   0.3%
Casa Systems, Inc. (4) Equity  —   —   —   —   65   —   —   0.0%
Casa Systems, Inc. (4) Warrants  —   —   —   —   33   —   —   0.0%
Casa Systems, Inc. (4) Warrants  —   —   —   —   33   —   —   0.0%
CE Intermediate I, LLC First Lien – Term Loan  11/10/2028   8.95%  S + 3.65%   5.30%  980   973   977   1.6%
GoTo Group, Inc. First Lien – Term Loan  4/30/2028   10.17%  S + 4.85%   5.32%  433   293   334   0.6%
Ingram Micro Inc. First Lien – Term Loan  6/30/2028   8.57%  S + 3.26%   5.31%  730   725   732   1.2%
Precisely Software Incorporated First Lien – Term Loan  4/24/2028   9.59%  S + 4.26%   5.32%  974   972   976   1.6%
Proofpoint, Inc. First Lien – Term Loan  8/31/2028   8.69%  S + 3.36%   5.33%  126   126   126   0.2%
Quest Software US Holdings Inc. First Lien – Term Loan  2/1/2029   9.71%  S + 4.40%   5.31%  1,478   1,467   1,129   1.8%
Rocket Software, Inc. First Lien – Term Loan  11/28/2028   10.08%  S + 4.75%   5.33%  747   737   743   1.2%
Ultra Clean Holdings, Inc. (5) First Lien - Term Loan  2/28/2028   8.82%  S + 3.50%   5.32%  183   182   184   0.3%

9

Steele Creek Capital Corporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		 Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
VeriFone Systems, Inc. First Lien - Term Loan 8/20/2025  9.59% S + 4.00%  5.59%  1,366   1,359   1,215   2.0%
Xerox Corporation (5) First Lien - Term Loan 11/17/2029  9.33% S + 4.00%  5.33%  417   405   419   0.7%
Total High Tech Industries                    9,088   7,641   12.5%
                               
Hotel, Gaming & Leisure                              
Alterra Mountain Company First Lien - Term Loan 5/31/2030  9.17% S + 3.85%  5.32%  500   500   503   0.8%
Arcis Golf LLC First Lien - Term Loan 11/24/2028  9.19% S + 3.86%  5.33%  983   976   987   1.6%
Fertitta Entertainment, LLC First Lien - Term Loan 1/27/2029  9.08% S + 3.75%  5.33%  980   979   984   1.6%
Herschend Entertainment Company, LLC First Lien - Term Loan 8/27/2028  8.33% S + 3.00%  5.33%  196   195   197   0.3%
Hilton Domestic Operating Company Inc. First Lien - Term Loan 11/8/2030  7.43% S + 2.00%  5.43%  750   748   752   1.2%
Kingpin Intermediate Holdings LLC (5) First Lien - Term Loan 2/8/2028  8.83% S + 3.50%  5.33%  299   296   299   0.5%
Sabre GLBL Inc. First Lien - Term Loan 12/17/2027  8.94% S + 3.61%  5.33%  426   425   363   0.6%
Sabre GLBL Inc. First Lien - Term Loan 12/17/2027  8.94% S + 3.61%  5.33%  272   271   232   0.4%
Sabre GLBL Inc. First Lien - Term Loan 6/30/2028  10.43% S + 5.10%  5.33%  347   333   305   0.5%
Station Casinos LLC First Lien - Term Loan 3/14/2031  7.58% S + 2.25%  5.33%  220   219   220   0.4%
TA TT Buyer, LLC First Lien - Term Loan 4/2/2029  10.30% S + 5.00%  5.30%  314   311   316   0.5%
Total Hotel, Gaming & Leisure                    5,253   5,158   8.4%
                               
Media: Advertising, Printing & Publishing                              
Oceankey (U.S.) II Corp. First Lien - Term Loan 12/15/2028  8.93% S + 3.60%  5.33%  980   973   971   1.6%
Thryv, Inc. (5) First Lien - Term Loan 3/1/2026  13.94% S + 8.61%  5.33%  734   733   737   1.2%
Total Media: Advertising, Printing & Publishing                    1,706   1,708   2.8%
                               
Media: Broadcasting & Subscription                              
Charter Communications Operating, LLC First Lien - Term Loan 12/7/2030  7.33% S + 2.00%  5.33%  998   993   989   1.6%
LCPR Loan Financing LLC First Lien - Term Loan 10/16/2028  9.19% S + 3.86%  5.33%  500   501   494   0.8%
Sinclair Television Group, Inc. First Lien - Term Loan 4/21/2029  9.18% S + 3.85%  5.33%  737   720   592   1.0%
Total Media: Broadcasting & Subscription                    2,214   2,075   3.4%
                               
Retail                              
Apro, LLC First Lien - Term Loan 11/14/2026  9.19% S + 3.86%  5.32%  1,310   1,305   1,314   2.1%
Great Outdoors Group, LLC First Lien - Term Loan 3/6/2028  9.19% S + 3.86%  5.33%  968   965   969   1.6%
Upbound Group, Inc. First Lien - Term Loan 2/17/2028  9.12% S + 3.68%  5.44%  546   546   546   0.9%
Total Retail                    2,816   2,829   4.6%

10

Steele Creek Capital Corporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		 Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Services: Business                        
Ahead DB Holdings, LLC First Lien - Term Loan 10/18/2027  9.16% S + 3.85%  5.31%  972   972   975   1.6%
Aragorn Parent Corporation First Lien - Term Loan 12/15/2028  9.58% S + 4.25%  5.33%  421   417   423   0.7%
Artera Services, LLC First Lien - Term Loan 2/15/2031  9.81% S + 4.50%  5.31%  528   524   531   0.9%
Camelot U.S. Acquisition LLC First Lien - Term Loan 1/31/2031  8.08% S + 2.75%  5.33%  316   315   316   0.5%
Citco Funding LLC First Lien - Term Loan 4/27/2028  8.42% S + 3.25%  5.17%  746   743   749   1.2%
Conduent Business Services, LLC First Lien - Term Loan 10/16/2028  9.69% S + 4.36%  5.33%  498   497   499   0.8%
Congruex Group LLC First Lien - Term Loan 5/3/2029  11.21% S + 5.90%  5.31%  983   963   936   1.6%
DTI Holdco, Inc. First Lien - Term Loan 4/26/2029  10.06% S + 4.75%  5.31%  1,114   1,096   1,115   1.8%
Flame NewCo, LLC First Lien - Term Loan 6/30/2028  7.43% S + 2.10%  5.33%  376   376   354   0.6%
GTCR W Merger Sub LLC First Lien - Term Loan 1/31/2031  8.31% S + 3.00%  5.31%  750   746   754   1.2%
Instructure Holdings, Inc. (5) First Lien - Term Loan 10/30/2028  8.35% S + 3.01%  5.34%  249   247   250   0.4%
Iron Mountain Information Management, LLC First Lien - Term Loan 1/31/2031  7.58% S + 2.25%  5.33%  421   418   418   0.7%
Mermaid Bidco Inc. (Datasite) First Lien - Term Loan 12/22/2027  9.58% S + 4.25%  5.33%  974   972   978   1.6%
Nexus Buyer LLC First Lien - Term Loan 12/13/2028  9.83% S + 4.50%  5.33%  750   729   747   1.2%
Nielsen Consumer Inc. First Lien - Term Loan 3/6/2028  9.08% S + 3.75%  5.33%  485   484   468   0.8%
Phoenix Services International LLC Equity —  —  —  —   31   311   153   0.3%
Pitney Bowes Inc. (5) First Lien - Term Loan 3/17/2028  9.44% S + 4.11%  5.33%  970   964   970   1.6%
Presidio Holdings Inc. First Lien - Term Loan 1/22/2027  8.93% S + 3.60%  5.33%  982   982   986   1.6%
Rockwood Service Corporation First Lien - Term Loan 1/23/2027  9.69% S + 4.36%  5.33%  248   248   249   0.4%
Sitel Group First Lien - Term Loan 8/28/2028  9.19% S + 3.86%  5.33%  1,463   1,458   1,261   2.1%
Skopima Consilio Parent LLC First Lien - Term Loan 5/12/2028  9.44% S + 4.11%  5.33%  975   972   972   1.6%
TRC Companies LLC First Lien - Term Loan 12/8/2028  9.19% S + 3.86%  5.33%  860   857   859   1.4%
UST Global Inc First Lien - Term Loan 11/20/2028  8.94% S + 3.61%  5.32%  978   975   976   1.6%
Vestis Corporation (5) First Lien - Term Loan 2/22/2031  7.58% S + 2.25%  5.33%  316   315   316   0.5%
Total Services: Business                    16,581   16,255   26.7%
                               
Services: Consumer                              
Prime Security Services Borrower, LLC First Lien - Term Loan 10/13/2030  7.83% S + 2.50%  5.33%  499   494   500   0.8%
University Support Services LLC First Lien - Term Loan 2/10/2029  8.43% S + 3.10%  5.33%  995   995   994   1.6%
WW International, Inc. (5) First Lien - Term Loan 4/13/2028  8.94% S + 3.61%  5.33%  945   943   422   0.7%
Total Services: Consumer                    2,432   1,916   3.1%

11

Steele Creek Capital Corporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		 Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Telecommunications                        
Ciena Corporation (5) First Lien - Term Loan 10/24/2030  7.33% S + 2.00%  5.33%  993   989   996   1.6%
ConvergeOne Holdings, Corp. (6) First Lien - Term Loan 1/4/2026  —  —  —   1,454   1,427   306   0.5%
Guardian US Holdco LLC First Lien - Term Loan 1/31/2030  8.81% S + 3.50%  5.31%  295   290   296   0.5%
Iridium Satellite LLC First Lien - Term Loan 9/20/2030  7.83% S + 2.50%  5.33%  125   125   125   0.2%
Mavenir Systems, Inc. First Lien - Term Loan 8/18/2028  10.34% S + 5.01%  5.32%  1,294   1,285   926   1.5%
SBA Senior Finance II LLC First Lien - Term Loan 1/25/2031  7.34% S + 2.00%  5.34%  1,250   1,247   1,254   2.1%
Syniverse Holdings, LLC First Lien - Term Loan 5/13/2027  12.30% S + 7.00%  5.30%  985   958   943   1.6%
Zayo Group Holdings, Inc. First Lien - Term Loan 3/9/2027  8.44% S + 3.00%  5.44%  1,000   998   881   1.4%
Total Telecommunications                    7,319   5,727   9.4%
                               
Transportation: Cargo                              
Carriage Purchaser, Inc. First Lien - Term Loan 10/2/2028  9.69% S + 4.36%  5.33%  975   972   980   1.6%
Clue Opco LLC First Lien - Term Loan 12/19/2030  9.83% S + 4.50%  5.33%  697   670   688   1.1%
Daseke Companies, Inc. (5) First Lien - Term Loan 3/9/2028  11.50% S + 3.00%  8.50%  775   773   776   1.3%
Echo Global Logistics, Inc. First Lien - Term Loan 11/23/2028  8.93% S + 3.60%  5.33%  980   979   968   1.6%
Kenan Advantage Group, Inc., The First Lien - Term Loan 1/25/2029  9.08% S + 3.75%  5.33%  633   630   634   1.0%
Total Transportation: Cargo                    4,024   4,046   6.6%
                               
Transportation: Consumer                              
Avolon TLB Borrower 1 (US) LLC First Lien - Term Loan 6/22/2028  7.33% S + 2.00%  5.33%  1,184   1,180   1,186   1.9%
First Student Bidco Inc. First Lien - Term Loan 7/21/2028  8.56% S + 3.26%  5.30%  358   356   358   0.6%
First Student Bidco Inc. First Lien - Term Loan 7/21/2028  8.56% S + 3.26%  5.30%  108   108   109   0.2%
United AirLines, Inc. (5) First Lien - Term Loan 2/22/2031  8.08% S + 2.75%  5.33%  369   367   370   0.6%
Total Transportation: Consumer                    2,011   2,023   3.3%

12

Steele Creek Capital Corporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		 Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Utilities: Electric                        
Calpine Construction Finance Company, L.P. First Lien - Term Loan 7/31/2030  7.58% S + 2.25%  5.33%  249   247   249   0.4%
Calpine Corporation First Lien - Term Loan 1/31/2031  7.33% S + 2.00%  5.33%  1,793   1,784   1,784   2.9%
PG&E Corporation (5) First Lien - Term Loan 6/23/2027  7.83% S + 2.50%  5.33%  500   498   501   0.8%
Total Utilities: Electric                    2,529   2,534   4.1%
                               
Total Investments made in the United States                    133,586   128,734   210.8%
                               
Investments made in Canada                              
Beverage, Food & Tobacco                              
1011778 B.C. Unlimited Liability Company (5) First Lien - Term Loan 9/20/2030  7.58% S + 2.25%  5.33%  998   993   998   1.6%
Total Beverage, Food & Tobacco                    993   998   1.6%
                               
Transportation: Consumer                              
Air Canada (5) First Lien - Term Loan 3/14/2031  7.83% S + 2.50%  5.33%  1,500   1,496   1,505   2.5%
Total Transportation: Consumer                    1,496   1,505   2.5%
                               
Services: Business                              
Nuvei Technologies Corp. (5) First Lien - Term Loan 12/19/2030  8.43% S + 3.10%  5.33%  1,053   1,046   1,057   1.7%
Total Services: Business                    1,046   1,057   1.7%
                               
Total Investments made in Canada                    3,535   3,560   5.8%

13

Steele Creek Capital Corporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		 Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Investments made in France                              
Healthcare & Pharmaceuticals                              
Curium BidCo S.a r.l. (5) First Lien - Term Loan 7/31/2029  9.81% S + 4.50%  5.31%  248   246   250   0.4%
Total Healthcare & Pharmaceuticals                    246   250   0.4%
                               
Total Investments made in France                    246   250   0.4%
                               
Investments made in Germany                              
Construction & Building                              
Minimax Viking GmbH (5) First Lien - Term Loan 7/31/2028  8.19% S + 2.86%  5.33%  498   496   499   0.8%
Total Construction & Building                    496   499   0.8%
                               
Investments made in Germany                    496   499   0.8%
                               
Investments made in Ireland                              
Aerospace & Defense                              
Setanta Aircraft Leasing DAC (5) First Lien - Term Loan 11/5/2028  7.56% S + 2.26%  5.30%  500   498   502   0.8%
Total Aerospace & Defense                    498   502   0.8%
                               
Hotel, Gaming & Leisure                              
Flutter Entertainment plc (5) First Lien - Term Loan 11/25/2030  7.56% S + 2.25%  5.31%  957   954   959   1.6%
Total Hotel, Gaming & Leisure                    954   959   1.6%
                               
Services: Consumer                              
Cimpress plc (5) First Lien - Term Loan 5/17/2028  8.94% S + 3.61%  5.33%  973   966   973   1.6%
Total Services: Consumer                    966   973   1.6%
                               
Transportation: Consumer                              
Delos Aircraft Designated Activity Company First Lien - Term Loan 10/31/2027  7.30% S + 2.00%  5.30%  500   500   502   0.8%
Total Transportation: Consumer                    500   502   0.8%
                               
Total Investments made in Ireland                    2,918   2,936   4.8%
                               
Investments made in Luxembourg                              
Containers, Packaging & Glass                              
Mar Bidco S.a r.l. (5) First Lien - Term Loan 7/7/2028  9.56% S + 4.25%  5.31%  14   13   13   0.0%
Total Containers, Packaging & Glass                    13   13   0.0%
                               
Telecommunications                              
Venga Finance S.a r.l. (5) First Lien - Term Loan 6/28/2029  10.35% S + 5.01%  5.34%  985   962   986   1.6%
Total Telecommunications                    962   986   1.6%
                               
Total Investments made in Luxembourg                    975   999   1.6%
                               
Investments made in the Netherlands                        
Chemicals, Plastics, & Rubber                        
Nouryon Finance B.V. (5) First Lien - Term Loan 4/3/2028  9.42% S + 4.10%  5.32%  864   853   868   1.4%
Total Chemicals, Plastics, & Rubber                    853   868   1.4%

14

Steele Creek Capital Corporation

Consolidated Schedule of Investments

March 31, 2024

(unaudited)

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate(2)		  Basis Point
Spread Above
Index(2)		 Interest Rate
Floor / Base
Rate(2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Retail                              
Peer Holding III B.V. (5) First Lien - Term Loan 10/28/2030  8.56% S + 3.25%  5.31%  528   524   530   0.9%
Total Retail                    524   530   0.9%
                               
Total Investments made in the Netherlands                    1,377   1,398   2.3%
                               
Investments made in Puerto Rico                              
Services: Business                              
Evertec Group, LLC First Lien - Term Loan 10/30/2030  8.83% S + 3.50%  5.33%  475   468   477   0.8%
Total Services: Business                    468   477   0.8%
                               
Total Investments made in Puerto Rico                    468   477   0.8%
                               
Investments made in Switzerland                              
Transportation: Consumer                              
Radar Bidco SARL (5) First Lien - Term Loan 3/27/2031  9.56% S + 4.25%  5.31%  1,000   995   1,001   1.6%
Total Transportation: Consumer                    995   1,001   1.6%
                               
Total Investments made in Switzerland                    995   1,001   1.6%
                               
Investments made in the United Kingdom                              
Chemicals, Plastics, & Rubber                              
Ineos US Finance LLC (5) First Lien - Term Loan 2/18/2030  8.93% S + 3.60%  5.33%  203   202   204   0.3%
Ineos Quattro Holdings UK Limited (5) First Lien - Term Loan 4/2/2029  9.68% S + 4.35%  5.33%  500   490   500   0.8%
Ineos Quattro Holdings UK Limited (5) First Lien - Term Loan 3/14/2030  9.18% S + 3.85%  5.33%  118   117   118   0.2%
Total Chemicals, Plastics, & Rubber                    809   822   1.3%
                               
Total Investments made in the United Kingdom                    809   822   1.3%
                               
Total Non-controlled/Non-Affiliated Investments                   $145,405  $140,676   230.2%

(1)All investments are non-controlled/non-affiliated investments as defined by the Investment Company Act of 1940 (the “1940 Act”). The provisions of the 1940 Act classify investments based on the level of control that the Company maintains in a particular portfolio company. As defined in the 1940 Act, a company is generally presumed to be “non-controlled” when the Company owns 25% or less of the portfolio company’s voting securities and “controlled” when the Company owns more than 25% of the portfolio company’s voting securities. The provisions of the 1940 Act also classify investments further based on the level of ownership that the Company maintains in a particular portfolio company. As defined in the 1940 Act, a company is generally deemed as “non-affiliated” when the Company owns less than 5% of a portfolio company’s voting securities and “affiliated” when the Company owns 5% or more of a portfolio company’s voting securities.

(2)(2)Unless otherwise indicated, issuers of debt held by the Company are domiciled in the United States.
(3)The majority of the investments bear interest at a rate that may be determined by reference to Secured Overnight Financing Rate (“SOFR” or “S”), however a small percentage of loans are still transitioning from London Interbank Offered Rate (“LIBOR” or “L”) which. Both indices reset monthly or quarterly. For each such investment, the Fund has provided the spread over LIBORSOFR and the current contractual interest rate in effect at September 30, 2020.March 31, 2024. As of September 30, 2020,March 31, 2024, rates for 1M L,S, 3M S, 6M S, and 12M S are 5.33%, 5.30%, 5.22%, and 5.00% respectively. As of March 31, 2024 rate for 3M L and 6M L are 0.15%, 0.23%, and 0.26% respectively.is 5.56%.

(3)(4)Percentages are based on net shareholder’s equityassets of $24,017,398$61,119 as of September 30, 2020.March 31, 2024.

(4)Inputs in the valuation of this investment included certain unobservable inputs that were significant to the valuation as a whole (see Note 4)

(5)PositionInvestment is a non-qualifying asset for RIC reporting purposes, non-qualifying assets represent 17.9% of total assets.

(6)Investment or a portion of the investment was sold prior to September 30, 2020, remaining cost balance will be adjusted upon settlementon non-accrual status as of March 31, 2024

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


15

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal/
Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets (3)		 
Non-controlled/Non-Affiliated Investments - 224.0% of Shareholder’s Equity (4)                         
Investments made in the United States                         
Aerospace & Defense                               
Amentum Government Services Holdings LLC First Lien - Term Loan 2/15/2029  9.36% S + 4.00%        5.36%  853  $     850  $     855        1.4%
Barnes Group Inc. (5) First Lien - Term Loan 9/3/2030  8.46% S + 3.10%   5.36%  998   997   1,002   1.6%
HDT Holdco, Inc. First Lien - Term Loan 7/8/2027  11.36% S + 6.01%   5.35%  505   495   245   0.4%
LSF11 Trinity Bidco, Inc. First Lien - Term Loan 6/14/2030  9.36% S + 4.00%   5.36%  490   483   494   0.8%
MAG DS Corp. First Lien - Term Loan 4/1/2027  10.95% S + 5.60%   5.35%  916   888   880   1.4%
Peraton Corp. First Lien - Term Loan 2/1/2028  9.21% S + 3.85%   5.36%  952   949   955   1.5%
TransDigm Inc. (5) First Lien - Term Loan 

2/14/2031

  8.60% S + 3.25%   5.35%  750   748   754   1.2%
Vertex Aerospace Services Corp. First Lien - Term Loan 12/6/2028  8.71% S + 3.35%   5.36%  983   979   985   1.6%
Total Aerospace & Defense                     6,389   6,170   9.9%
                                
Automotive                               
Autokiniton US Holdings, Inc. First Lien - Term Loan 4/6/2028  9.97% S + 4.61%   5.36%  968   962   972   1.6%
First Brands Group, LLC First Lien - Term Loan 3/30/2027  10.88% S + 5.43%   5.45%  248   239   246   0.4%
First Brands Group, LLC First Lien - Term Loan 3/30/2027  10.88% S + 5.43%   5.45%  977   977   971   1.6%
Holley Inc. (5) First Lien - Term Loan 11/17/2028  9.22% S + 3.75%   5.47%  904   905   874   1.4%
Phinia Inc. (5) First Lien - Term Loan 7/3/2028  9.46% S + 4.10%   5.36%  499   480   502   0.8%
Thor Industries, Inc. (5) First Lien - Term Loan 11/15/2030  8.11% S + 2.75%   5.36%  750   746   753   1.2%
Total Automotive                     4,309   4,318   7.0%

16

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Banking, Finance, Insurance & Real Estate                               
AmWINS Group, Inc. First Lien - Term Loan 2/19/2028  8.22% S + 2.86%   5.36%       495   491   497   0.8%
AssuredPartners, Inc. First Lien - Term Loan 2/12/2027  8.86% S + 3.50%   5.36%  983   981   986   1.6%
Baldwin Risk Partners, LLC First Lien - Term Loan 10/14/2027  8.97% S + 3.61%   5.36%  746   741   747   1.2%
Citadel Securities LP First Lien - Term Loan 7/29/2030  7.97% S + 2.61%   5.36%  1,448   1,437   1,453   2.3%
Cushman & Wakefield U.S. Borrower, LLC (5) First Lien - Term Loan 1/31/2030  8.71% S + 3.35%   5.36%  498   489   495   0.8%
DRW Holdings, LLC First Lien - Term Loan 3/1/2028  9.22% S + 3.86%   5.36%  531   530   531   0.9%
FinCo I LLC First Lien - Term Loan 6/27/2029  8.38% S + 3.00%   5.38%  746   743   750   1.2%
Greystar Real Estate Partners, LLC (5) First Lien - Term Loan 8/21/2030  9.12% S + 3.75%   5.37%  527   519   528   0.9%
Guggenheim Partners Investment Management Holdings, LLC First Lien - Term Loan 12/12/2029  8.60% S + 3.25%   5.35%  113   111   113   0.2%
Jane Street Group, LLC First Lien - Term Loan 1/26/2028  8.22% S + 2.86%   5.36%  975   968   980   1.6%
Lakeview Loan Servicing, LLC (4) (5) First Lien - Term Loan 12/21/2028  8.74% S + 3.36%   5.38%  1,000   995   995   1.6%
LendingTree, Inc. (5) First Lien - Term Loan 9/15/2028  9.21% S + 3.86%   5.35%  1,481   1,481   1,378   2.2%
ONBE, Inc. First Lien - Term Loan 12/10/2027  11.97% S + 6.61%   5.36%  805   784   808   1.3%
OFSBS 2022-11A (5) Collateralized Loan Obligation 10/18/2035  8.89% S + 3.50%   5.39%  1,000   1,000   1,006   1.6%
OFSI BSL CLO XII, Ltd. Collateralized Loan Obligation 1/20/2035  14.27% S + 8.85%   5.42%  1,000   983   997   1.6%
Osaic Holdings, Inc. (5) First Lien - Term Loan 8/17/2028  9.86% S + 4.50%   5.36%  468   464   470   0.8%
Paysafe Group Holdings II Limited First Lien - Term Loan 6/28/2028  8.22% S + 2.86%   5.36%  979   954   978   1.6%
Resolute Investment Managers, Inc. (4) First Lien - Term Loan 4/30/2027  12.11% S + 6.76%   5.35%  454   454   454   0.7%
Resolute Investment Managers, Inc. (4) Equity —  —  —   —   6   —   —   0.0%
Russell Investments US Institutional Holdco, Inc. First Lien - Term Loan 5/30/2025  8.96% S + 3.60%   5.36%  1,558   1,549   1,463   2.4%
Ryan Specialty Group, LLC First Lien - Term Loan 9/1/2027  8.46% S + 3.10%   5.36%  486   487   487   0.8%
Sound Point CLO Ltd Collateralized Loan Obligation 7/26/2036  14.23% S + 8.81%   5.42%  500   468   502   0.8%
Total Banking, Finance, Insurance & Real Estate                     16,629   16,618   26.9%

17

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Beverage, Food & Tobacco                               
Flynn Restaurant Group LP First Lien - Term Loan 12/1/2028  9.72% S + 4.36%   5.36%  748   743            753   1.2%
Total Beverage, Food & Tobacco                     743   753   1.2%
                                
Capital Equipment                               
Chart Industries, Inc. First Lien - Term Loan 3/15/2030  8.69% S + 3.35%   5.34%  913   909   917   1.5%
DS Parent, Inc. First Lien - Term Loan 12/10/2028  11.21% S + 5.75%   5.46%  900   879   902   1.5%
Novae LLC First Lien - Term Loan 12/22/2028  10.52% S + 5.00%   5.52%  585   563   576   0.9%
Watlow Electric Manufacturing Company First Lien - Term Loan 3/2/2028  9.40% S + 4.01%   5.39%  825   820   827   1.3%
Total Capital Equipment                     3,171   3,222   5.2%
                                
Chemicals, Plastics, & Rubber                               
Albaugh, LLC First Lien - Term Loan 4/6/2029  9.13% S + 3.75%   5.38%  1,198   1,189   1,162   1.9%
Bakelite US Holdco, Inc. First Lien - Term Loan 5/29/2029  9.50% S + 4.15%   5.35%  985   982   984   1.6%
DCG Acquisition Corp. First Lien - Term Loan 9/30/2026  9.96% S + 4.60%   5.36%  258   258   257   0.4%
Element Solutions Inc (Macdermid, Incorporated) (5) First Lien - Term Loan 12/18/2030  7.36% S + 2.00%   5.36%  1,000   998   1,004   1.6%
H.B. Fuller Company (5) First Lien - Term Loan 2/15/2030  7.61% S + 2.25%   5.36%  118   118   119   0.2%
Sparta U.S. Holdco LLC First Lien - Term Loan 8/2/2028  8.71% S + 3.36%   5.34%  490   488   490   0.8%
Tronox Finance LLC First Lien - Term Loan 8/16/2028  8.85% S + 3.50%   5.35%  1,000   991   1,001   1.6%
Total Chemicals, Plastics, & Rubber                     5,024   5,017   8.1%
                                
Construction & Building                               
84 Lumber Company First Lien - Term Loan 11/29/2030  8.21% S + 2.85%   5.36%  350   348   351   0.6%
APi Group DE, Inc. (5) First Lien - Term Loan 1/3/2029  7.97% S + 2.61%   5.36%  645   645   646   1.0%
Columbus McKinnon Corporation First Lien - Term Loan 5/14/2028  8.39% S + 3.01%   5.38%  694   689   697   1.1%
Crown Subsea Communications Holding, Inc. First Lien - Term Loan 4/27/2027  10.71% S + 5.36%   5.34%  488   479   491   0.8%
Janus International Group, LLC First Lien - Term Loan 8/3/2030  8.76% S + 3.35%   5.41%  631   625   634   1.0%
Smyrna Ready Mix Concrete, LLC First Lien - Term Loan 4/2/2029  8.86% S + 3.50%   5.36%  640   624   642   1.0%
Summit Materials, LLC First Lien - Term Loan 1/12/2029  7.85% S + 2.50%   5.35%  105   105   105   0.2%
TAMKO Building Products LLC First Lien - Term Loan 9/20/2030  8.87% S + 3.50%   5.37%  998   993   1,004   1.6%
Total Construction & Building                     4,508   4,570   7.3%

18

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Consumer Goods: Durable                               
Hercules Achievement, Inc. (Varsity Brands Holding Co., Inc.) First Lien - Term Loan 12/15/2026  10.47% S + 5.11%   5.36%  990   982   986   1.6%
Hunter Douglas Holding B.V. First Lien - Term Loan 2/26/2029  8.88% S + 3.50%   5.38%  985   981   983   1.6%
LHS Borrower, LLC First Lien - Term Loan 2/16/2029  10.21% S + 4.85%   5.36%  654   648   593   1.0%
Mannington Mills, Inc. First Lien - Term Loan 8/6/2026  9.36% S + 4.01%   5.35%  385   385   356   0.6%
Pelican Products, Inc. First Lien - Term Loan 12/29/2028  9.75% S + 4.40%   5.35%  980   978   913   1.5%
Recess Holdings, Inc. First Lien - Term Loan 3/29/2027  9.39% S + 4.00%   5.39%  631   626   637   1.0%
Total Consumer Goods: Durable                     4,600   4,468   7.3%
                                
Consumer Goods: Non-Durable                               
Conair Holdings LLC First Lien - Term Loan 5/17/2028  9.22% S + 3.86%   5.36%  1,126   1,122   1,107         1.8%
Total Consumer Goods: Non-Durable                     1,122   1,107   1.8%
                                
Containers, Packaging & Glass                               
Canister International Group Inc. First Lien - Term Loan 12/21/2026  10.21% S + 4.85%   5.36%  484   482   486   0.8%
Pactiv Evergreen Inc. (5) First Lien - Term Loan 9/24/2028  8.72% S + 3.36%   5.36%  977   955   981   1.6%
Plaze, Inc. First Lien - Term Loan 8/3/2026  9.22% S + 3.86%   5.36%  654   648   637   1.0%
Sabert Corporation First Lien - Term Loan 12/10/2026  9.22% S + 3.86%   5.35%  803   801   809   1.3%
Total Containers, Packaging & Glass                     2,886   2,913   4.7%
                                
Energy: Electricity                               
Astoria Energy LLC First Lien - Term Loan 12/10/2027  8.97% S + 3.61%   5.36%  920   917   923   1.5%
Hamilton Projects Acquiror, LLC First Lien - Term Loan 6/17/2027  9.97% S + 4.61%   5.36%  771   755   775   1.3%
Invenergy Thermal Operating I LLC First Lien - Term Loan 8/14/2029  9.92% S + 4.61%   5.31%  864   848   868   1.4%
Invenergy Thermal Operating I LLC First Lien - Term Loan 8/14/2029  9.92% S + 4.61%   5.31%  71   70   72   0.1%
Vistra Operations Company LLC First Lien - Term Loan 12/20/2030  7.36% S + 2.00%   5.36%  845   837   846   1.4%
Total Energy: Electricity                     3,427   3,484   5.7%
                                
Energy: Oil & Gas                               
AL NGPL Holdings, LLC First Lien - Term Loan 4/13/2028  8.85% S + 3.50%   5.35%  657   660   658   1.1%
BCP Renaissance Parent L.L.C. First Lien - Term Loan 10/31/2028  8.87% S + 3.50%   5.37%  186   186   187   0.3%
CQP Holdco LP First Lien - Term Loan 12/31/2030  8.35% S + 3.00%   5.35%  727   726   730   1.2%
GIP Pilot Acquisition Partners, L.P. First Lien - Term Loan 10/4/2030  8.39% S + 3.00%   5.39%  211   211   211   0.3%
ITT Holdings LLC First Lien - Term Loan 10/5/2030  8.71% S + 3.35%   5.36%  998   978   1,002   1.6%
Prairie ECI Acquiror LP First Lien - Term Loan 3/11/2026  10.21% S + 4.85%   5.36%  499   493   500   0.8%
Traverse Midstream Partners LLC First Lien - Term Loan 2/16/2028  9.24% S + 3.85%   5.39%  412   410   414   0.7%
Total Energy: Oil & Gas                     3,664   3,702   6.0%

19

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Environmental Industries                               
JFL-Tiger Acquisition Co., Inc. First Lien - Term Loan 10/17/2030  10.40% S + 5.00%   5.40%  316   308   317   0.5%
Total Environmental Industries                     308   317   0.5%
                                
Forest Products & Paper                               
Mativ Holdings, Inc. (5) First Lien - Term Loan 4/20/2028  9.22% S + 3.86%   5.36%  433   430   431   0.7%
Total Forest Products & Paper                     430   431   0.7%
                                
Healthcare & Pharmaceuticals                               
Amneal Pharmaceuticals LLC (5) First Lien - Term Loan 5/4/2028  10.86% S + 5.50%   5.36%  989   937   976   1.6%
ANI Pharmaceuticals, Inc. (5) First Lien - Term Loan 11/19/2027  11.47% S + 6.11%   5.36%  980   971   984   1.6%
Athletico Management, LLC First Lien - Term Loan 2/15/2029  9.75% S + 4.40%   5.35%  246   240   208   0.3%
Aveanna Healthcare LLC (5) First Lien - Term Loan 7/17/2028  9.24% S + 3.85%   5.39%  424   424   396   0.6%
Bayou Intermediate II, LLC First Lien - Term Loan 8/2/2028  10.15% S + 4.50%   5.65%  710   708   679   1.1%
Carestream Dental Technology Parent Limited First Lien - Term Loan 9/1/2024  9.95% S + 4.60%   5.35%  888   883   741   1.2%
Charlotte Buyer, Inc. First Lien - Term Loan 2/11/2028  10.61% S + 5.25%   5.36%  499   489   501   0.8%
Confluent Health, LLC First Lien - Term Loan 11/30/2028  9.47% S + 4.11%   5.36%  943   941   927   1.5%
FC Compassus, LLC First Lien - Term Loan 12/31/2026  9.89% S + 4.51%   5.38%  1,215   1,214   1,197   1.9%
Global Medical Response, Inc. First Lien - Term Loan 10/2/2025  9.93% S + 4.51%   5.42%  485   481   382   0.6%
Golden State Buyer, Inc. First Lien - Term Loan 6/21/2026  10.19% S + 4.85%   5.34%  941   936   906   1.5%
HAH Group Holding Company LLC First Lien - Term Loan 10/29/2027  10.46% S + 5.00%   5.46%  996   983   990   1.6%
HAH Group Holding Company LLC First Lien - Delayed Draw Loan 10/29/2027  10.46% S + 5.00%   5.46%  126   124   125   0.2%
Ingenovis Health, Inc. First Lien - Term Loan 3/6/2028  9.22% S + 3.86%   5.36%  973   969   947   1.5%
Iqvia Inc. First Lien - Term Loan 1/2/2031  7.35% S + 2.00%   5.35%  250   250   251   0.4%
Onex TSG Intermediate Corp. First Lien - Term Loan 2/28/2028  10.39% S + 5.01%   5.38%  975   963   965   1.6%
Pacific Dental Services, LLC First Lien - Term Loan 5/5/2028  8.97% S + 3.61%   5.36%  210   210   210   0.3%
PDS Holdco, Inc. First Lien - Term Loan 8/18/2028  10.15% S + 4.76%   5.39%  1,334   1,329   843   1.4%
PDS Holdco, Inc. First Lien - Delayed Draw Loan 8/18/2028  10.15% S + 4.76%   5.39%  136   136   86   0.1%
R1 RCM Inc. (5) First Lien - Term Loan 6/21/2029  8.33% S + 3.00%   5.33%  500   494   501   0.8%
Select Medical Corporation (5) First Lien - Term Loan 3/6/2027  8.36% S + 3.00%   5.36%  104   104   105   0.2%
Sotera Health Holdings, LLC (5) First Lien - Term Loan 12/11/2026  9.11% S + 3.75%   5.36%  219   214   219   0.4%
TTF Holdings, LLC First Lien - Term Loan 3/31/2028  9.47% S + 4.11%   5.36%  635   631   635   1.0%
U.S. Anesthesia Partners, Inc. First Lien - Term Loan 10/1/2028  9.71% S + 4.36%   5.34%  1,089   1,085   998   1.6%
US Radiology Specialists, Inc. (US Outpatient Imaging Services, Inc.) First Lien - Term Loan 12/15/2027  10.75% S + 5.40%   5.35%  980   975   976   1.6%
Total Healthcare & Pharmaceuticals                     16,691   15,748   25.4%

20

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
High Tech Industries                               
Boxer Parent Company Inc. First Lien - Term Loan 12/29/2028  9.61% S + 4.25%   5.36%  369   365   372   0.6%
Casa Systems, Inc. First Lien - Term Loan 12/20/2027  12.26% S + 6.93%   5.33%  1,231   1,231   880   1.4%
Casa Systems, Inc. (4) Equity —  —  —   —   65   —   24   0.0%
Casa Systems, Inc. (4) Warrants —  —  —   —   33   —   —   0.0%
Casa Systems, Inc. (4) Warrants —  —  —   —   33   —   —   0.0%
CE Intermediate I, LLC First Lien - Term Loan 11/10/2028  9.02% S + 3.65%   5.37%  983   975   975   1.6%
GoTo Group, Inc. First Lien - Term Loan 8/31/2027  10.28% S + 4.90%   5.38%  970   957   646   1.0%
Ingram Micro Inc. First Lien - Term Loan 6/30/2028  8.61% S + 3.26%   5.35%  730   725   733   1.2%
Monotype Imaging Holdings Inc. First Lien - Term Loan 10/9/2026  10.45% S + 5.00%   5.45%  716   714   720   1.2%
Precisely Software Incorporated First Lien - Term Loan 4/24/2028  9.64% S + 4.26%   5.38%  976   975   970   1.6%
Quest Software US Holdings Inc. First Lien - Term Loan 2/1/2029  9.78% S + 4.40%   5.38%  1,481   1,470   1,141   1.8%
Revspring, Inc. (fka Dantom Systems, Inc.) First Lien - Term Loan 10/11/2025  9.61% S + 4.26%   5.35%  736   732   733   1.2%
Rocket Software, Inc. First Lien - Term Loan 11/28/2028  10.11% S + 4.75%   5.36%  749   738   737   1.2%
VeriFone Systems, Inc. First Lien - Term Loan 8/20/2025  9.64% S + 4.00%   5.64%  1,370   1,362   1,330   2.2%
Xerox Corporation (5) First Lien - Term Loan 11/17/2029  9.36% S + 4.00%   5.36%  422   410   423   0.7%
Total High Tech Industries                     10,654   9,684   15.7%
                                
Hotel, Gaming & Leisure                               
Arcis Golf LLC First Lien - Term Loan 11/24/2028  9.22% S + 3.86%   5.36%  985   978   990   1.6%
ClubCorp Holdings, Inc. First Lien - Term Loan 9/18/2026  10.61% S + 5.26%   5.35%  481   475   465   0.8%
Fertitta Entertainment, LLC First Lien - Term Loan 1/27/2029  9.36% S + 4.00%   5.36%  983   981   984   1.6%
Herschend Entertainment Company, LLC First Lien - Term Loan 8/27/2028  9.22% S + 3.86%   5.36%  197   196   198   0.3%
Hilton Domestic Operating Company Inc. First Lien - Term Loan 11/8/2030  7.46% S + 2.10%   5.36%  750   748   754   1.2%
Kingpin Intermediate Holdings LLC (5) First Lien - Term Loan 2/8/2028  8.86% S + 3.50%   5.36%  299   297   300   0.5%
Sabre GLBL Inc. First Lien - Term Loan 12/17/2027  8.97% S + 3.61%   5.36%  426   425   374   0.6%
Sabre GLBL Inc. First Lien - Term Loan 12/17/2027  8.97% S + 3.61%   5.36%  272   271   239   0.4%
Sabre GLBL Inc. First Lien - Term Loan 6/30/2028  10.46% S + 5.10%   5.36%  347   333   310   0.5%
TA TT Buyer, LLC First Lien - Term Loan 4/2/2029  10.35% S + 5.00%   5.35%  315   312   314   0.5%
Total Hotel, Gaming & Leisure                     5,016   4,928   8.0%

21

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Media: Advertising, Printing & Publishing                               
Oceankey (U.S.) II Corp. First Lien - Term Loan 12/15/2028  8.96% S + 3.60%   5.36%  983   975   963   1.6%
Thryv, Inc. (5) First Lien - Term Loan 3/1/2026  13.97% S + 8.61%   5.36%  757   755   758   1.2%
Total Media: Advertising, Printing & Publishing                     1,730   1,721   2.8%
                                
Media: Broadcasting & Subscription                               
Charter Communications Operating, LLC First Lien - Term Loan 12/7/2030  7.36% S + 2.00%   5.36%  1,000   995   998   1.6%
LCPR Loan Financing LLC First Lien - Term Loan 10/16/2028  9.29% S + 3.94%   5.35%  500   501   502   0.8%
Sinclair Television Group, Inc. First Lien - Term Loan 4/21/2029  9.21% S + 3.85%   5.36%  739   722   607   1.0%
Total Media: Broadcasting & Subscription                     2,218   2,107   3.4%
                                
Retail                               
Apro, LLC First Lien - Term Loan 11/14/2026  9.21% S + 3.86%   5.35%  1,313   1,308   1,316   2.1%
Great Outdoors Group, LLC First Lien - Term Loan 3/6/2028  9.22% S + 3.86%   5.36%  970   967   971   1.6%
Upbound Group, Inc. First Lien - Term Loan 2/17/2028  9.12% S + 3.68%   5.44%  547   547   548   0.9%
Total Retail                     2,822   2,835   4.6%

22

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Services: Business                               
Ahead DB Holdings, LLC First Lien - Term Loan 10/18/2027  9.20% S + 3.85%   5.35%  975   975   973   1.6%
Aragorn Parent Corporation First Lien - Term Loan 12/15/2028  9.61% S + 4.25%   5.36%  422   418   422   0.7%
Artera Services, LLC First Lien - Term Loan 3/6/2025  8.95% S + 3.50%   5.45%  975   970   921   1.5%
Citco Funding LLC First Lien - Term Loan 4/27/2028  8.64% S + 3.25%   5.39%  748   744   752   1.2%
Congruex Group LLC First Lien - Term Loan 5/3/2029  11.28% S + 5.90%   5.38%  985   965   941   1.5%
DTI Holdco, Inc. First Lien - Term Loan 4/26/2029  10.13% S + 4.75%   5.38%  1,117   1,098   1,106   1.8%
Flame NewCo, LLC First Lien - Term Loan 6/30/2028  11.46% S + 6.10%   5.36%  373   373   348   0.6%
GTCR W Merger Sub LLC First Lien - Term Loan 9/20/2030  8.33% S + 3.00%   5.33%  750   746   754   1.2%
Instructure Holdings, Inc. (5) First Lien - Term Loan 10/30/2028  8.68% S + 3.18%   5.50%  249   248   251   0.4%
Iron Mountain Information Management, LLC First Lien - Term Loan 1/31/2031  7.61% S + 2.25%   5.36%  422   419   423   0.7%
Mermaid Bidco Inc. (Datasite) First Lien - Term Loan 12/22/2027  9.88% S + 4.50%   5.38%  976   974   982   1.6%
Nexus Buyer LLC First Lien - Term Loan 12/13/2028  9.86% S + 4.50%   5.36%  750   728   746   1.2%
Nielsen Consumer Inc. First Lien - Term Loan 3/6/2028  9.11% S + 3.75%   5.36%  486   485   467   0.7%
Phoenix Services International LLC Equity —  —  —   —   31   311   153   0.2%
Pitney Bowes Inc. (5) First Lien - Term Loan 3/17/2028  9.47% S + 4.11%   5.36%  973   966   960   1.5%
Presidio Holdings Inc. First Lien - Term Loan 1/22/2027  8.98% S + 3.60%   5.38%  984   984   988   1.6%
Rockwood Service Corporation First Lien - Term Loan 1/23/2027  9.72% S + 4.36%   5.36%  249   248   250   0.4%
Sitel Group First Lien - Term Loan 8/28/2028  9.22% S + 3.86%   5.36%  1,466   1,461   1,414   2.3%
Skopima Consilio Parent LLC First Lien - Term Loan 5/12/2028  9.47% S + 4.00%   5.47%  978   974   976   1.6%
Tempo Acquisition, LLC First Lien - Term Loan 8/31/2028  8.11% S + 2.75%   5.36%  978   975   983   1.6%
TRC Companies LLC First Lien - Term Loan 12/8/2028  9.22% S + 3.86%   5.36%  862   859   862   1.4%
UST Global Inc First Lien - Term Loan 11/20/2028  8.96% S + 3.61%   5.34%  980   977   979   1.6%
VM Consolidated, Inc. First Lien - Term Loan 3/24/2028  8.72% S + 3.36%   5.36%  2   2   2   0.0%
Zelis Cost Management Buyer, Inc. First Lien - Term Loan 9/30/2026  8.97% S + 3.61%   5.36%  415   413   417   0.7%
Total Services: Business                     17,313   17,070   27.6%
                                
Services: Consumer                               
Prime Security Services Borrower, LLC First Lien - Term Loan 10/13/2030  7.84% S + 2.50%   5.34%  500   495   502   0.8%
University Support Services LLC First Lien - Term Loan 2/10/2029  8.71% S + 3.35%   5.36%  997   997   999   1.6%
WW International, Inc. (5) First Lien - Term Loan 4/13/2028  8.97% S + 3.61%   5.36%  945   942   674   1.1%
Total Services: Consumer                     2,434   2,175   3.5%

23

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Telecommunications                               
CCI Buyer, Inc. First Lien - Term Loan 12/17/2027  9.35% S + 4.00%   5.35%  973   967   971   1.6%
Ciena Corporation (5) First Lien - Term Loan 10/24/2030  7.36% S + 2.00%   5.36%  995   991   999   1.6%
ConvergeOne Holdings, Corp. First Lien - Term Loan 1/4/2026  12.50% L + 4.00%   8.50%  1,458   1,445   829   1.3%
Guardian US Holdco LLC First Lien - Term Loan 1/31/2030  9.35% S + 4.00%   5.35%  296   290   297   0.5%
Iridium Satellite LLC First Lien - Term Loan 9/20/2030  7.86% S + 2.50%   5.36%  52   52   52   0.1%
Mavenir Systems, Inc. First Lien - Term Loan 8/18/2028  10.39% S + 5.01%   5.38%  1,297   1,288   918   1.5%
Syniverse Holdings, LLC First Lien - Term Loan 5/13/2027  12.35% S + 7.00%   5.35%  988   959   873   1.4%
Zayo Group Holdings, Inc. First Lien - Term Loan 3/9/2027  8.47% S + 3.00%   5.47%  1,000   997   865   1.4%
Total Telecommunications                     6,989   5,804   9.4%
                                
Transportation: Cargo                               
Carriage Purchaser, Inc. First Lien - Term Loan 10/2/2028  9.72% S + 4.36%   5.36%  978   974   962   1.6%
Clue Opco LLC First Lien - Term Loan 12/19/2030  9.86% S + 4.50%   5.36%  750   720   713   1.1%
Daseke Companies, Inc. (5) First Lien - Term Loan 3/9/2028  9.47% S + 4.11%   5.36%  800   797   800   1.3%
Echo Global Logistics, Inc. First Lien - Term Loan 11/23/2028  8.96% S + 3.50%   5.46%  983   981   964   1.6%
Kenan Advantage Group, Inc., The First Lien - Term Loan 3/24/2026  9.47% S + 4.11%   5.36%  249   247   249   0.4%
Total Transportation: Cargo                     3,719   3,688   6.0%
                                
Transportation: Consumer                               
Avolon TLB Borrower 1 (US) LLC First Lien - Term Loan 6/22/2028  7.36% S + 2.00%   5.36%  1,187   1,182   1,192   1.9%
Brown Group Holding, LLC First Lien - Term Loan 7/2/2029  9.11% S + 3.75%   5.36%  992   983   996   1.6%
First Student Bidco Inc. First Lien - Term Loan 7/21/2028  8.61% S + 3.26%   5.35%  359   357   357   0.6%
First Student Bidco Inc. First Lien - Term Loan 7/21/2028  8.61% S + 3.26%   5.35%  108   108   108   0.2%
Safe Fleet Holdings LLC First Lien - Term Loan 2/23/2029  9.21% S + 3.85%   5.36%  632   629   634   1.0%
United AirLines, Inc. (5) First Lien - Term Loan 4/21/2028  9.22% S + 3.86%   5.36%  774   772   778   1.3%
Total Transportation: Consumer                     4,031   4,065   6.6%

24

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Utilities: Electric                               
Calpine Construction Finance Company, L.P. First Lien - Term Loan 7/31/2030  7.61% S + 2.25%   5.36%  249   248   250   0.4%
PG&E Corporation (5) First Lien - Term Loan 6/23/2027  7.86% S + 2.50%   5.36%  500   498   501   0.8%
Total Utilities: Electric                     746   751   1.2%
                                
Total Investments made in the United States                     131,573   127,666   206.5%
                                
Investments made in Canada                               
Beverage, Food & Tobacco                               
1011778 B.C. Unlimited Liability Company (5) First Lien - Term Loan 9/20/2030  7.61% S + 2.25%   5.36%  1,000   995   1,002   1.6%
Total Beverage, Food & Tobacco                     995   1,002   1.6%
                                
Hotel, Gaming & Leisure                               
Ontario Gaming GTA Limited Partnership (5) First Lien - Term Loan 8/1/2030  9.60% S + 4.25%   5.35%  173   171   174   0.3%
Total Hotel, Gaming & Leisure                     171   174   0.3%
                                
Transportation: Consumer                               
Air Canada (5) First Lien - Term Loan 8/11/2028  9.14% S + 3.76%   5.38%  748   751   751   1.2%
Total Transportation: Consumer                     751   751   1.2%
                                
Services: Business                               
Nuvei Technologies Corp. (5) First Lien - Term Loan 12/19/2030  7.96% S + 2.50%   5.46%  1,056   1,048   1,057   1.7%
Total Services: Business                     1,048   1,057   1.7%
                               
Total Investments made in Canada                     2,965   2,984   4.8%
                                
Investments made in France                               
Healthcare & Pharmaceuticals                               
Curium BidCo S.a r.l. (5) First Lien - Term Loan 7/31/2029  9.85% S + 4.50%   5.35%  249   246   249   0.4%
Total Healthcare & Pharmaceuticals                     246   249   0.4%
                                
Total Investments made in France                     246   249   0.4%

25

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Investments made in Germany Construction & Building                               
Minimax Viking GmbH (5) First Lien - Term Loan 7/31/2028  8.22% S + 2.86%   5.36%  498   496   500   0.8%
Total Construction & Building                     496   500   0.8%
                                
High Tech Industries                               
Mosel Bidco SE First Lien - Term Loan 9/16/2030  10.10% S + 4.75%   5.35%  211   209   212   0.3%
Total High Tech Industries                     209   212   0.3%
                                
Investments made in Germany                     705   712   1.1%
                                
Investments made in Ireland                               
Aerospace & Defense                               
Setanta Aircraft Leasing DAC (5) First Lien - Term Loan 11/5/2028  7.61% S + 2.26%   5.35%  1,500   1,496   1,506   2.4%
Total Aerospace & Defense                     1,496   1,506   2.4%
                                
Hotel, Gaming & Leisure                               
Flutter Entertainment plc (5) First Lien - Term Loan 11/25/2030  7.70% S + 2.35%   5.35%  739   737   742   1.2%
Total Hotel, Gaming & Leisure                     737   742   1.2%
                                
Services: Consumer                               
Cimpress plc (5) First Lien - Term Loan 5/17/2028  8.97% S + 3.61%   5.36%  975   968   976   1.6%
Total Services: Consumer                     968   976   1.6%
                                
Transportation: Consumer                               
Delos Aircraft Designated Activity Company First Lien - Term Loan 10/31/2027  7.35% S + 2.00%   5.35%  500   500   503   0.8%
Total Transportation: Consumer                     500   503   0.8%
                                
Total Investments made in Ireland                     3,701   3,727   6.0%
                                
Investments made in Luxembourg                               
Containers, Packaging & Glass                               
Mar Bidco S.a r.l. (5) First Lien - Term Loan 7/7/2028  9.51% S + 4.20%   5.31%  14   14   13   0.0%
Total Containers, Packaging & Glass                     14   13   0.0%
                                
Telecommunications                               
Venga Finance S.a r.l. (5) First Lien - Term Loan 6/28/2029  10.40% S + 5.01%   5.39%  988   963   984   1.6%
Total Telecommunications                     963   984   1.6%
                                
Total Investments made in Luxembourg                     977   997   1.6%

26

STEELE CREEK CAPITAL CORPORATION

Consolidated Schedule of Investments

December 31, 2023

(in thousands, except per share data)

Description (1) Investment
Type		 Maturity Interest
Rate (2)		  Basis
Point
Spread
Above
Index (2)		  Interest
Rate
Floor /
Base
Rate (2)		  Principal
/Shares		  Amortized
Cost		  Fair
Value		  % of Net
Assets(3)		 
Investments made in the Netherlands Chemicals, Plastics, & Rubber                               
Nouryon Finance B.V. (5) First Lien - Term Loan 4/3/2028  9.47% S + 4.10%   5.37%  866        855   870   1.4%
Total Chemicals, Plastics, & Rubber                     855   870   1.4%
                                
Retail                               
Peer Holding III B.V. (5) First Lien - Term Loan 10/28/2030  8.60% S + 3.25%   5.35%  528   524   530   0.9%
Total Retail                     524   530   0.9%
                                
Total Investments made in the Netherlands                     1,379   1,400   2.3%
                                
Investments made in Puerto Rico                               
Services: Business                               
Evertec Group, LLC First Lien - Term Loan 10/30/2030  8.86% S + 3.50%   5.36%  475   468   477   0.8%
Total Services: Business                     468   477   0.8%
                                
Total Investments made in Puerto Rico                     468   477   0.8%
                                
Investments made in the United Kingdom                               
Chemicals, Plastics, & Rubber                               
Ineos US Finance LLC (5) First Lien - Term Loan 2/18/2030  8.96% S + 3.60%   5.36%  204   202   204   0.3%
Ineos Quattro Holdings UK Limited (5) First Lien - Term Loan 3/14/2030  9.21% S + 3.85%   5.36%  118   117   117   0.2%
Total Chemicals, Plastics, & Rubber                     319   321   0.5%
                                
Total Investments made in the United Kingdom                     319   321   0.5%
                                
Total Non-controlled/Non-Affiliated Investments                    $142,333  $138,533   224.0%

(1)All investments are non-controlled/non-affiliated investments as defined by the Investment Company Act of 1940 (the “1940 Act”). The provisions of the 1940 Act classify investments based on the level of control that the Company maintains in a particular portfolio company. As defined in the 1940 Act, a company is generally presumed to be “non-controlled” when the Company owns 25% or less of the portfolio company’s voting securities and “controlled” when the Company owns more than 25% of the portfolio company’s voting securities. The provisions of the 1940 Act also classify investments further based on the level of ownership that the Company maintains in a particular portfolio company. As defined in the 1940 Act, a company is generally deemed as “non-affiliated” when the Company owns less than 5% of a portfolio company’s voting securities and “affiliated” when the Company owns 5% or more of a portfolio company’s voting securities.

(2)The majority of the investments bear interest at a rate that may be determined by reference to Secured Overnight Financing Rate (“SOFR” or “S”), however, a small percentage of loans are still transitioning from London Interbank Offered Rate (“LIBOR” or “L”). Both indices reset monthly or quarterly. For each such investment, the Fund has provided the spread over SOFR and the current contractual interest rate in effect at December 31, 2023. As of December 31, 2023, rates for 1M S, 3M S, 6M S, and 12M S are 5.35%, 5.33%, 5.16%, and 4.77% respectively. As of December 31, 2023, rates for 1M L, 3M L, and 6M L are 5.47%, 5.59%, and 5.59% respectively.

(3)Percentages are based on net assets of $61,858 as of December 31, 2023.

(4)Inputs in the valuation of this investment included certain unobservable inputs that were significant to the valuation as a whole (see Note 4)

(5)Investment is a non-qualifying asset for RIC reporting purposes, non-qualifying assets represent 17.2% of total assets.

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

 

27

MSC

Steele Creek Capital LLCCorporation

Notes to the Consolidated Financial Statements (Unaudited)

For the period July 1, 2020 (commencement of operations)(unaudited)

Through September 30, 2020(in thousands, except share and per share data)

1. ORGANIZATION

MSCSteele Creek Capital LLC,Corporation (which is referred to as the “Company”, “we”, “us” and “our”) was originally organized pursuant to theas MSC Capital LLC as a Delaware Limited Liability Company Act (the “LLC Act”) by filing a Certificate of Formation in the Office of the Secretary of State of the State of Delawarelimited liability company on June 3, 2020. We operate under the Amended and Restated Limited Liability Agreement ofThe Company commenced operations as MSC Capital LLC (the “Agreement”). Capitalized terms used in these notes without definition shall have meanings as defined in the Agreement.

In Septemberon July 1, 2020. On October 7, 2020, we formedMSC Capital LLC converted to a wholly-owned special purpose financing vehicle, Steele Creek Funding I, LLC,Maryland corporation. We are a Delaware limited liability company.

The Company intends to electclosed-end externally managed, non-diversified management investment company that has elected to be treated as a business development company (“BDC”) under the Investment Company Act of 1940 as amended (the “1940 Act”). Please see Footnote 12 Subsequent Events, for additional information on the BDC election.

The Company shall have perpetual existence unless sooner dissolvedhas elected for federal income tax purposes to be treated as a regulated investment company (“RIC”) under the Internal Revenue Code of 1986, as amended (the “Code”).

In September 2020, we formed a wholly-owned special purpose financing vehicle, Steele Creek Funding I, LLC (“Funding I”), a Delaware limited liability company.

Steele Creek Investment Management LLC (the “Investment Advisor” or “Administrator”) is our investment adviser and wound up pursuantan affiliate of Moelis Asset Management LP (“Moelis Asset”). We entered into an Investment Advisory Agreement with the Investment Advisor who, subject to Section 17the supervision of our board of directors (the “Board”), manages the Agreement, or byday-to-day operations and provides investment advisory services to the entry of a decree of judicial dissolution under Section 18-802 of the LLC Act.

Company. The Company has no paid employees and is managed by Steele Creekthe Investment Management LLCAdvisor has entered into an agreement (the “Manager”“Custody Agreement”) to delegate certain administrative and custody functions to US Bank (the “Custodian”). The debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and neither the Members nor any other person or entity shall be obligated personally for any such debt, obligation or liability of the Company.

The Company is a financial services company that primarily invests in syndicated corporate bank loans, bonds, other debt securities, and structured products. The investment objective is to generate high current income by investing primarily in fixed income instruments, including broadly syndicated bank loans, structured products, mezzanine financings and senior secured bonds.

All adjustments, in the opinion of management, necessary to fair statement of the results for the interim periods presented have been made.

The term “shares” herein refers to membership interest in the Company prior to conversion.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting– - The consolidated financial statements have been prepared on the accrual basis of accounting in conformity with U.S. generally accepted accounting principles (“GAAP”) and include the accounts of the Company and its consolidated subsidiaries. The Company is an investment company following accounting and reporting guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946, Financial Services-Investment Companies. The consolidated financial statements reflect all adjustments and reclassifications that, in the opinion of management, are necessary for the fair presentation of the results of operations and financial condition as of and for the periods presented. All significant intercompany balances and transactions have been eliminated. Interim financialFinancial statements are prepared in accordance with GAAP for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Articles 6 or 10 of Regulation S-X. In the opinion of management, all adjustments, consisting solely of normal recurring accruals considered necessary for the fair presentation of financial statements for the interim period presented, have been included. The current period’s results of operations will not necessarilyThese unaudited consolidated financial statements should be indicative of results that ultimately may be achievedread in conjunction with the audited financial statements included in the Annual Report on Form 10-K for the fiscal year endingended December 31, 2020.2023 filed with the Securities and Exchange Commission (“SEC”).

Use of Estimates -- The preparation of the consolidated financial statements in conformity with U.S. GAAP requires the ManagerInvestment Advisor to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from such estimates included in the consolidated financial statements.


MSC Capital LLC

Notes to the Consolidated Financial Statements (Unaudited)

For the period July 1, 2020 (commencement of operations)

Through September 30, 2020

Securities Transactions - - Securities transactions are recorded on the trade date. The trade date for loans purchased in the “primary market” and for loans and other investments purchased in the “secondary market” is the date on which the transaction is entered. Cost is determined based on consideration given, adjusted for amortization of original issuance discounts (“OID”), market discounts and premiums.

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Investment Income - For debt investments, we record interest income on the accrual basis to the extent that such amounts are expected to be collected. Where applicable, OID and purchased discounts and premiums are accreted into interest income using the effective interest method. Loan origination fees are deferred and accreted into interest income using the effective interest method. We record prepayment premiums on loans and other investments as interest income when such amounts are received. We stop accruing interest on investments when it is determined that interest is no longer collectible. As of September 30, 2020,For the three months ended March 31, 2024 and 2023, there were notwo loans inand one loan on non-accrual status.status, respectively.

Expenses - Expenses include management fees, incentive fees, administrator fees, custody fees, legal fees, audit and tax service expenses, third-party valuation fees and other general and administrative expenses. Expenses are recognized on an accrual basis.

Organizational and Offering Costs - Organizational costs include costs relating to the formation and incorporation of the business and are expensed as incurred. Offering costs include legal fees and other costs pertaining to the registration statement and the private placement memorandum. Offering costs are deferred and amortized over a period of twelve months.

Realized Gain or Loss and Unrealized Gain or Loss - Realized gain or loss from an investment is recorded at the time of disposition and calculated using the weighted average cost method. Unrealized gain or loss reflects the changes in fair value of investments as determined in compliance with the Manager’sInvestment Advisor’s valuation policy.

Cash - The Company maintains its cash in a bank account, which, at times, may exceed federally insured limits. As of September 30, 2020, the Company’sMarch 31, 2024, and December 31, 2023, our cash balance exceeded federally insured limits. The ManagerInvestment Advisor continuously monitors the performance of the bank where the account is held in order to manage any risk associated with such account.

Earnings per sharePer Share - - The Company calculates earnings per share by dividing the net increase or decrease in shareholders’ equitynet assets resulting from operations by the weighted average shares for the period.

Paid-in-capital in Excess of Par Value - - The Company records the proceeds from the sale of its shares on a net basis to capital stock and paid-in capital in excess of par value, excluding all offering costs.

Fair Value of Financial Instruments - – Assets and liabilities which qualify as financial instruments under relevant authoritative guidance are carried at fair value or contractual amounts approximating fair value.

Investment Classification - As required by the 1940 Act, investments are classified by level of control. “Controlled Investments” are defined as investments in portfolio companies that we are deemed to control, as defined in the 1940 Act. “Affiliated Investments” are investments in those companies that are affiliated companies, as defined in the 1940 Act, other than Controlled Investments. “Non-Controlled/Non-Affiliated Investments” are those that are neither Controlled Investments nor Affiliated Investments. Generally, under the 1940 Act, we are deemed to control a company in which we have invested if we own more than 25% of the voting securities of such company. We are deemed to be an affiliate of a company if we own 5% or more of the voting securities of such company. As of March 31, 2024 and December 31, 2023, all of our investments were Non-Controlled/Non-Affiliated investments.

Valuation of Investments - The Company records its financial instrumentsWe value our investments in accordance with the 1940 Act and ASC Topic 820 — – Fair Value Measurement and Disclosures, (“ASC Topic 820”). as determined in good faith by our Board who has delegated such responsibility to our Investment Advisor, along with our Independent valuation firms, and the Audit Committee. ASC Topic 820 defines fair value, establishes a framework used to measure fair value and requires disclosures for fair value measurements. In accordance with ASC Topic 820, the Company has categorized its financial instruments carried at fair value, based on the priority of the valuation technique, into a three-level fair value hierarchy. Investments are reflected on the Consolidated Statement of Assets and Liabilities at fair value, with changes in unrealized gains and losses resulting from changes in fair value reflected in the accompanying Consolidated Statement of Operations as “net change in unrealized appreciation on non-controlled/non-affiliatenon-affiliated company investments.” Fair value is the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date (i.e., the exit price). Publicly-traded investments in active markets are reported at the market closing price.

Investment transactions are recorded on a trade date basis (for publicly-traded investments and securities traded through dealer markets) or upon closing of the transaction (for private investments). The cost of an investment includes all costs incurred by the Company as part of the purchase of such investment. The difference between the initially recognized cost and the subsequent fair value measurement of an investment is reflected as “net change in unrealized appreciation on non-controlled/non-affiliatenon-affiliated company investments.”investments” in the Consolidated Statement of Operations.

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MSC Capital LLC

Notes to the Consolidated Financial Statements (Unaudited)

For the period July 1, 2020 (commencement of operations)

Through September 30, 2020

Due to the uncertainty relating to London Interbank Offered Rate (“LIBOR”), we are monitoring potential changes that may adversely affect the market for LIBOR-based securities, includingWe value our portfolio of LIBOR-indexed, floating-rate debt securities.

The Company values its investments in accordance with the Manager’sInvestment Advisor’s valuation policy. Valuations are prepared by the Investment Advisor and approved by the valuation committee on a monthly basis.CFO of the Company for each accounting close.

Transfers of investments between different levels ofin the fair value hierarchy are recorded at the end of the period. For the three months ended March 31, 2024 there were two term loans investments that transferred from level 3 to level 2 at quarter end. The transfer between levels was made due to availability of broker quotes and increased trading volume for the three months ended March 31, 2024. For the three months ended March 31, 2023 there were no transfers between levels.

Income Taxes -– No provisionFor the three months ended March 31, 2024 and 2023, we have complied with the requirements of Subchapter M of the Code and expect to be treated as a RIC for federal income tax purposes. In this regard, we account for income taxes has been madeusing the asset and liability method prescribed by ASC Topic 740 – Income Taxes (“ASC Topic 740”). Under this method, income taxes are provided for amounts currently payable and for amounts deferred as tax assets and liabilities based on differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities. Based upon our qualification and election to be treated as a RIC for federal income tax purposes, we typically do not incur any material federal income taxes. However, we may choose to retain a portion of our calendar year income, which may result in the accompanying consolidated financial statements, asimposition of an excise tax.

We recognize the Members are individually responsible for reporting income or losseffect of a tax position in our Consolidated Financial Statements in accordance with ASC Topic 740 when it is more likely than not, based on their respective share of the Company’s revenues and expenses for income tax purposes. The Company files U.S. Federal and state and local tax returns.

Based on its analysis, the Manager has determinedtechnical merits, that the Company doesposition will be sustained upon examination by the applicable tax authority. Tax positions not have any materiallyconsidered to satisfy the “more-likely-than-not” threshold would be recorded as a tax expense or benefit. Penalties or interest, if applicable, that may be assessed relating to income taxes would be classified as other operating expenses in the financial statements. There were no tax accruals relating to uncertain tax positions that require recognition and measurement in the Company’s consolidated financial statements.

The Manager will continue to review the relevant authoritative guidance as such relatesno amounts accrued for any related interest or penalties with respect to the period presented herein. The Company’s consolidated financial statements and conclusions reacheddeterminations regarding uncertain tax positions, whichASC Topic 740 may be subject to review and adjustment at a later date based on ongoing analysesupon factors including, but not limited to, an on-going analysis of tax laws, regulations and interpretations thereof. ToAlthough the extent thatCompany files both federal and state income tax returns, the Manager’s assessment of the conclusions reached regarding uncertainCompany’s major tax positions changes, such changejurisdiction is federal.

Because federal income tax regulations differ from GAAP, distributions in estimate willaccordance with tax regulations may differ from net investment income and net realized gains recognized for financial reporting purposes. Differences between tax regulations and GAAP may be recordedpermanent or temporary. Permanent differences are reclassified among capital accounts in the periodConsolidated Financial Statements to reflect their tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in which such determination is made. the future.

The Company’s policy is2020 to recognize2023 tax related interestyears for the Company are not yet closed and penalties, if any, as incomeremain subject to examination by U.S. Federal, state and local tax expense. Forauthorities.

Recent Accounting Pronouncements

The Company considers the period July 1, 2020 (commencementapplicability and impact of operations) through September 30, 2020, no such amounts were recognized.

Administration Agreement - The Manager has entered into an agreement (the “Administration Agreement”all accounting standard updates (“ASU”) to delegate certain administrative and custody functions to US Bank (the “Administrator”).

3. RECENT ACCOUNTING PRONOUNCEMENTS

In March 2020,issued by the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-04, Reference Rate Reform (Topic 848), which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. ASU No. 2020-04 is elective and effective for all entities as of March 12, 2020 through December 31, 2022.. The Company is currently evaluating thereviewed recent accounting pronouncements and determined them to be not applicable or expect them to have minimal impact of adopting ASU No. 2020-04.

In August 2020, the U.S. Securities and Exchange Commission (“SEC”) issued Final Rule Release No. 33-10825 and No.34-89670, collectively referred to as ‘Modernization of Regulation S-X Items 101, 103 and 105’. These rules amend certain SEC disclosure requirements to improve disclosure for investors and to simplify compliance for registrants, including new requirements for human capital disclosures and a summary of risk factors. The final rules are effective for all filings on or after November 9, 2020. The Company is evaluating the impact of adopting the Final Rule on ourits consolidated financial statements.

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MSC Capital LLC

3. AGREEMENTS AND RELATED PARTY TRANSACTIONS

Notes

Investment Advisory Agreement

Pursuant to the Consolidated Financial Statements (Unaudited)investment advisory agreement between the Company and the Investment Advisor (the “Investment Advisory Agreement”), we have agreed to pay a fee for investment advisory and management services consisting of two components, a base management fee and an incentive fee. The cost of both the base management fee and the incentive fee will ultimately be borne by our stockholders.

Our Investment Advisor has agreed to waive its fees (base management and incentive fee), without recourse against or reimbursement by us, for any quarter where net investment income plus net realized capital gains is not sufficient to maintain a targeted annual distribution payment on shares of common stock outstanding on the relevant payment dates of 6.0% based on our net asset value per share.

On August 11, 2023, the Board approved the renewal of the Investment Advisory Agreement which automatically renews for successive one-year periods each September 17th; provided that such continuance is specifically approved at least annually by the vote of the Board or by the vote of a majority of the outstanding voting securities of the Company and the vote of a majority of the Independent Directors, in accordance with the requirements of the 1940 Act. 

Base Management Fee

The base management fee is calculated at a maximum annual rate of 1.0% of the average of the weighted average (based on the number of shares outstanding each day in the quarter) of our gross assets (including uninvested cash and cash equivalents) at the end of each of the two most recently completed calendar quarters. The base management fee for any partial quarter is pro-rated based on the number of days actually elapsed in that quarter relative to the total number of days in such quarter. On August 13, 2021, the Board agreed to make investments rather than gross assets the basis for their fee to be more in line with the waivers implemented for management fees. 

Gross and net management fees for the three months ended March 31, 2024 were $455 thousand and $349 thousand, respectively. The Investment Advisor elected to waive a portion of the management fee and charged management fees on investments rather than gross assets.

Gross and net management fees for the three months ended March 31, 2023 were $372 thousand and $320 thousand, respectively. The Investment Advisor elected to waive a portion of the management fee and charged management fees on investments rather than gross assets.

Incentive Fee

The Incentive Fee will consist of an income-based component and a capital gains component.

The portion of the incentive fee based on income is determined and paid quarterly in arrears commencing with the first calendar quarter following the Company’s election to be regulated as a BDC, and equals 15% of the pre-incentive fee net investment income in excess of a 1.5% quarterly (or 6% annually) “hurdle rate.” There are no catch-up provisions applicable to income-based incentive fees under the Investment Advisory Agreement.

Pre-incentive fee net investment income means interest income, dividend income and any other income (including any other fees, such as commitment, origination, structuring, diligence, managerial and consulting fees or other fees the Company receives from portfolio companies) that the Company accrues, minus the Company’s operating expenses for the quarter (including the base management fee, expenses payable under the administration agreement (the “Administration Agreement”) we have entered into with the Administrator, and any interest expense and dividends paid on any issued and outstanding indebtedness or preferred stock, respectively, but excluding, for avoidance of doubt, the income-based incentive fee accrued under GAAP). Pre-incentive fee net investment income also includes, in the case of investments with a deferred interest feature (such as OID, debt instruments with PIK interest and zero coupon securities), accrued income that the Company has not yet received in cash. The Investment Advisor is not under any obligation to reimburse the Company for any part of the income-based incentive fees it received that was based on accrued interest that the Company never actually received. Because of the structure of the incentive fee, it is possible that we may pay an incentive fee in a quarter where we incur a loss. For example, if we receive pre-incentive fee net investment income in excess of the Hurdle rate for a quarter, we will pay the applicable incentive fee even if we have incurred a loss in that quarter due to realized and unrealized capital losses.

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The portion of the incentive fee based on capital-gains is payable at the end of each calendar year in arrears, equals 15% of cumulative realized capital gains from the date of the Company’s election to be regulated as a BDC to the end of each calendar year, less cumulative net realized capital losses and unrealized capital depreciation. We will accrue, but will not pay, a capital gains incentive fee with respect to unrealized appreciation. Also, it should be noted that while we accrue the capital incentive fee quarterly, the expense will fluctuate with the Company’s overall investment results and the expense will be finalized at year end.

In determining the capital gains incentive fee payable to the Investment Advisor, we calculate the cumulative aggregate realized capital gains and cumulative aggregate realized capital losses since our inception, and the aggregate unrealized capital depreciation as of the date of the calculation, as applicable, with respect to each of the investments in our portfolio. For this purpose, cumulative aggregate realized capital gains, if any, equals the sum of the differences between the net sales price of each investment, when sold, and the original cost of such investment since our inception. Cumulative aggregate realized capital losses equals the sum of the amounts by which the net sales price of each investment, when sold, is less than the original cost of such investment since our inception. Aggregate unrealized capital depreciation equals the sum of the difference, if negative, between the valuation of each investment as of the applicable calculation date and the original cost of such investment. At the end of the applicable year, the amount of capital gains that serves as the basis for our calculation of the capital gains incentive fee equals the cumulative aggregate realized capital gains less cumulative aggregate realized capital losses, less aggregate unrealized capital depreciation, with respect to our portfolio of investments. 

For the period July 1,three months ended March 31, 2024, the Investment Advisor earned a gross income incentive fee of $56 thousand and did not earn a capital incentive fee. For the three months ended March 31, 2023, the Investment Advisor earned a gross income incentive fee of $76 thousand and did not earn a capital incentive fee.  

Fee Waivers

On February 18, 2021, the Company and the Investment Advisor executed a Waiver Letter (the “Waiver”), whereby the Investment Advisor agrees to waive all or such portion of the Base Management Fee, the Income Incentive Fee and the Capital Incentive Fee (collectively the “Fees”) that they would otherwise be entitled to receive under the Investment Advisory Agreement, dated as of September 16, 2020 (commencement(the ‘Agreement”) for any quarter prior to a Liquidity Event to the extent required in order for the Company to earn a quarterly net investment income plus net realized capital gains to maintain an annual distribution payment of operations)

Through September 30, 2020

In May 2020, the SEC adopted rule amendments thatshares of common stock outstanding of 6.0%. The Company’s performance will impact the requirementamount and timing of investment companies, including BDCs,the fee waivers.

For the three months ended March 31, 2024 and 2023, the Board agreed upon a fee waiver to disclosereduce the basis for the quarterly management fee from gross assets to investments. For the three months ended March 31, 2024 and 2023 the Investment Advisor waived $106 thousand and $52 thousand of management fees, respectively. This fee waiver will be re-evaluated annually.

The Company’s performance for the three months ended March 31, 2024 and 2023, produced sufficient realized income to meet the 6% distribution payment to investors and charge a full management fee on investments.

Administration Agreement

The Administration Agreement provides that the Administrator will furnish us with office facilities and equipment and will provide us with clerical, bookkeeping, recordkeeping and other administrative services at such facilities. Under the Administration Agreement, the Administrator will perform, or oversee the performance of, our required administrative services, which will include being responsible for the financial statementsand other records that we are required to maintain and preparing reports to our stockholders and reports and other materials filed with the SEC. In addition, the Administrator will assist us in determining and publishing our net asset value, oversee the preparation and filing of certain of their portfolio companies or certain acquired funds (the “Final Rules”). The Final Rules adopted a new definition of “significant subsidiary” set forth in Rule 1 02(w)(2) of Regulation S-X under the Securities Act. Rules 3-09 and 4-08(g) of Regulation S-X require investment companies to include separate financial statements or summary financial information, respectively, in such investment company’s periodic reports for any portfolio company that meets the definition of “significant subsidiary.” The new definition of “significant subsidiary” under Rule 1-02(w)(2) of Regulation S-X, which is tailored to investment companies, (i) modifies the investment testour tax returns and the income test,printing and (ii) eliminatesdissemination of reports and other materials to our stockholders, and generally oversee the asset test currently inpayment of our expenses and the definitionperformance of “significant subsidiary.” The new Rule 1-02(w)(2) of Regulation S-X is intendedadministrative and professional services rendered to more accurately captureus by others. Under the Administration Agreement, the Administrator will also provide managerial assistance on our behalf to those portfolio companies that are more likelyhave accepted our offer to materially impactprovide such assistance. 

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Under the financial conditionAdministration Agreement, we will reimburse the Administrator based upon our allocable portion (subject to the review and approval of an investment company. The Final Rulesour Board) of the Administrator’s overhead (including rent) in performing its obligations under the Administration Agreement, including rent, the fees and expenses associated with performing compliance functions and our allocable portion of the cost of our Chief Financial Officer and Chief Compliance Officer, and any of their respective staff who provide services to us, operations staff who provide services to us, and internal audit staff, if any, to the extent internal audit performs a role in our Sarbanes-Oxley internal control assessment. In addition, if requested to provide significant managerial assistance to our portfolio companies, the Administrator will be effectivepaid an additional amount based on January 1, 2021, but voluntary compliance is permitted in advancethe services provided, which shall not exceed the amount we receive from such portfolio companies for providing this assistance. The Administration Agreement had an initial term of two years and thereafter may be renewed annually with the approval of our Board. The Administration Agreement may be terminated by either party without penalty upon 60 days’ written notice to the other party. To the extent that the Administrator outsources any of its functions, we will pay the fees associated with such functions on a direct basis without any incremental profit to the Administrator.

On August 11, 2023, the Board approved the renewal of the effective date. Administration Agreement which automatically renews for successive one-year periods each September 17th; provided that such continuance is specifically approved at least annually by the vote of the Board or by the vote of a majority of the outstanding voting securities of the Company and the vote of a majority of the members of the Company’s Board who are not parties to this Agreement or “interested persons” (as such term defined in Section 2(a)(19) of the Investment Company Act) of any such party, in accordance with the Investment Company Act.

Related Party Transactions

As of March 31, 2024, affiliates owned approximately 38% of the Company representing approximately $22,989 thousand of the Company’s net assets. As of December 31, 2023, affiliates owned approximately 38% of the Company representing approximately $23,340 thousand of the Company’s net assets. 

The Company is evaluatingmay, from time to time, purchase investments from, or sell investments to affiliates of our Investment Advisor at fair value on the impacttrade date. For the three months ended March 31, 2024 and 2023 there were no purchases of adoptinginvestments from or sales of investments to affiliates of our Investment Advisor.

For the Final Rule on our consolidated financial statements.three months ended March 31, 2024 and 2023, the Company incurred $20 thousand in directors’ fees expense.

The Company carries employment practices liability, directors and officers and errors and omission insurance. For the best interests of the Company, these policies are joint liability policies with Moelis Asset and its affiliates.

4. INVESTMENTS

Fair Value Measurements

We value our investments on a monthly basisfor each accounting close at fair value in accordance with the 1940 Act and ASC Topic 820, which defines fair value as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Due to the uncertainty inherent in the valuation process, estimates of fair value may differ significantly from the values that would have been used had a ready market for our investments existed, and the differences could be material. Additionally, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on the investments to be different than the valuations currently assigned.

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Investments for which observable market prices in active markets do not exist are reported at fair value, as determined by the ManagerInvestment Advisor using the best information available. The amount determined to be fair value may incorporate the Manager’sInvestment Advisor’s own assumptions (including assumptions that the ManagerInvestment Advisor believes market participants would use in valuing the investment, and assumptions relating to appropriate risk adjustments for nonperformancenon-performance and lack of marketability).

The fair values assigned to the Company’sour investments are based upon available information and do not necessarily represent amounts which might ultimately be realized. Due to the absence of readily determinable fair values and the inherent uncertainty of valuations, the estimated fair values may differ significantly from values that would have been used had a ready market for the securities existed, and the differences could be material.

The guidance establishes a framework for measuring fair value, and requires enhanced disclosures about fair value measurements. The fair value hierarchy prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is impacted by a number of factors, including the type of investment, the characteristics specific to the investment, and the state of the marketplace (including the existence and transparency of transactions between market participants). Investments with readily-available actively quoted prices or for which fair value can be measured from actively-quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Investments measured and reported at fair value are classified and disclosed in one of the following categories (from highest to lowest) based on inputs:

Level 1 – Quoted prices (unadjusted) are available in active markets for identical investments that the Company has the ability to access as of the reporting date. The type of investments which would generally be included in Level 1 include listed equity securities and listed derivatives. The Company, to the extent that it holds such investments, does not adjust the quoted price for these investments, even in situations where the Company holds a large position and a sale could reasonably impact the quoted price.


MSC Capital LLC

Notes to the Consolidated Financial Statements (Unaudited)

For the period July 1, 2020 (commencement of operations)

Through September 30, 2020

Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. This may include valuations based on executed trades, broker quotations that constitute an executable price, and alternative pricing sources supported by observable inputs which, in each case, are either directly or indirectly observable for the asset in connection with market data at the measurement date.

Level 3 – Pricing inputs are unobservable for the investments and include situations where there is little, if any, market activity for the investments. The inputs into the determination of fair value require significant judgment or estimation by the Manager.Investment Advisor. In certain cases, investments classified within Level 3 may include securities for which we have obtained indicative quotes from broker-dealers that do not necessarily represent prices the broker may be willing to trade on.

The valuation techniques used maximize the use of observable inputs and minimize the use of unobservable inputs. Our loans are predominately valued based on evaluated prices from a nationally recognized independent pricing service or from third-party brokers who make markets in such debt investments. When possible, we make inquiries of third-party pricing sources to understand their use of significant inputs and assumptions. We review the third-party fair value estimates and perform procedures to validate their reasonableness, including an analysis of the range and dispersion of third-party estimates, frequency of pricing updates, comparison of recent trade activity for similar securities, and review for consistency with market conditions observed as of the measurement date.

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There may be instances when independent or third-party pricing sources are not available, or cases where we believe that the third-party pricing sources do not provide sufficient evidence to support a market participant’s view of the fair value of the debt investment being valued. These instances may result from an investment in a less liquid loan such as a middle market loan, a mezzanine loan or unitranche loan, or a loan to a company that has become financially distressed. In these instances, we may estimate the fair value based on a combination of a market yield valuation methodology and evaluated pricing discussed above, or solely based on a market yield valuation methodology. Under the market yield valuation methodology, we estimate the fair value based on a discounted cash flow technique. For these loans, the unobservable inputs used in the market yield valuation methodology to measure fair value reflect management’s best estimate of assumptions that would be used by market participants when pricing the investment in a hypothetical transaction, including estimated remaining life, current market yield and interest rate spreads of similar loans and securities as of the measurement date. We will estimate the remaining life based on market data for the average life of similar loans. However, if we have information that the loan is expected to be repaid in the near term, we would use an estimated remaining life based on the expected repayment date. The average life to be used to estimate the fair value of our loans may be shorter than the legal maturity of the loans since many loans are prepaid prior to the maturity date. The interest rate spreads used to estimate the fair value of our loans is based on current interest rate spreads of similar loans. If there is a significant deterioration of the credit quality of a loan, we may consider other factors that a hypothetical market participant would use to estimate fair value, including the proceeds that would be received in a liquidation analysis.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of observable input that is significant to the fair value measurement. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgement and considers factors specific to the investment.

The following fair value hierarchy table sets forth our investments by level as of September 30, 2020:March 31, 2024:

  March 31, 2024 
  Total  Level 1  Level 2  Level 3 
Term Loans $137,774  $  -  $137,590  $184 
Delayed Draw Loan  209   -   209   - 
Equity  153   -   153   - 
Collateralized Loan Obligations  2,540   -   2,540   - 
Total Investments $140,676  $-  $140,492  $184 

The following fair value hierarchy table sets forth our investments by level as of December 31, 2023:

  December 31, 2023 
  Total  Level 1  Level 2  Level 3 
Term Loans $135,640  $   -  $134,191  $1,449 
Delayed Draw Loan  211   -   211   - 
Equity  177   -   153   24 
Collateralized Loan Obligations  2,505   -   2,505   - 
Total Investments $138,533  $-  $137,060  $1,473 

Unobservable inputs used in the fair value measurement of Level 3 investments as of March 31, 2024, included the following:

 September 30, 2020  Fair Valuation Unobservable Range Weighted 
 Total Level 1  Level 2 Level 3 
Type  Value Technique Input Minimum Maximum Average 
Term Loans $26,726,554  $    -  $26,726,554  $      -   184 Discounted Cash Flows Market Comps 0% 100%  14.97% 
Total Investments $26,726,554  $-  $26,726,554  $- 
Total $184           


MSC Capital LLC

NotesCertain fair value measurements may employ more than one valuation technique, with each valuation technique receiving a relative weight between 0% and 100%. Generally, a change in an unobservable input may result in a change to the Consolidated Financial Statements (Unaudited)value of an investment as follows:

For the period July 1, 2020 (commencement of operations)

InputImpact to value if input increasesImpact to value if input decreases
Market CompsIncreaseDecrease

Through September 30, 2020

35

 

Due to

Changes in investments categorized as Level 3 for the uncertainty relating to London Interbank Offered Rate (“LIBOR”), we are monitoring potential changes that may adversely affect the market for and the valuation of LIBOR-based securities, including our portfolio of LIBOR-indexed, floating-rate debt securities.three months ended March 31, 2024 were as follows:

  Three months ended March 31, 2024 
   Term Loans   Equity   Total Investments 
Beginning Balance $1,449  $24  $1,473 
Net realized gain (loss)  -   -   - 
Net unrealized gain (loss)  -   (24)  (24)
Transfers (1)  (1,265)  -   (1,265)
Acquisitions  -   -   - 
Ending Balance $184  $-  $184 

(1)Per ASC 820, leveling for each investment is conducted at each quarter end. Transfers between levels are made in accordance with the Company’s accounting policy.

5. EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share for the period July 1, 2020 (commencement of operations) through September 30, 2020:three months ended March 31, 2024 and 2023:

  Three months
ended
March 31,
2024		  Three months
ended
March 31,
2023		 
Numerator - net earnings (loss) $305  $2,471 
Denominator - weighted average shares  6,344   5,692 
Net earnings (loss) per share $0.05  $0.43 

6. NET ASSETS

The Company has been actively fundraising since its inception. The table below summarizes the capital the Company has raised (returned) and the shares issued (tendered) to investors during the three months ended March 31, 2024.

Date Closed Capital
Raised
(in thousands)		  Shares
Issued		 
Balance at December 31, 2023 $66,290   6,370,722 
January 2, 2024  (524)  (53,915)
February 1, 2024  44   4,480 
March 1, 2024  669   69,303 
Balance at March 31, 2024 $66,479   6,390,590 

36

The table below summarizes the capital the Company has raised (returned) and the shares issued (tendered) to investors during the three months ended March 31, 2023.

 

  For the period
July 1,
2020
(commencement of operations) through
September 30,
2020		 
Numerator - net earnings $659,398 
Denominator - weighted average shares  15,681 
Net earnings per share $42.05 
Date Closed Capital
Raised
(in thousands)		  Shares
Issued		 
Balance at December 31, 2022 $59,241   5,643,073 
January 3, 2023  344   38,579 
February 1, 2023  50   5,300 
March 1, 2023  221   23,458 
Balance at March 31, 2023 $59,856   5,710,410 

 

6. INCOME TAXESDuring the three months ended March 31, 2024, the Company issued 73,783 shares with an aggregate value of $713 thousand and repurchased 53,915 shares with an aggregate tender price of $524 thousand. During the three months ended March 31, 2023, the Company issued 67,337 shares with an aggregate value of $615 thousand. During the three months ended March 31, 2023, no shares were tendered.

As of March 31, 2024, and December 31, 2023 the Company had 6,390,590 and 6,370,722 shares of common stock, $0.001 par value per share, outstanding, respectively. 

7. CREDIT FACILITY

On October 13, 2020, we entered into a two-year secured revolving Credit Agreement (the “Credit Agreement”) with BNP Paribas (“BNP”) as lender and administrative agent (the “BNP Credit Facility”) providing a maximum of $45,000 thousand (“Maximum Facility Amount”) to Steele Creek Capital Funding I, LLC (“Funding”). The Company created a wholly owned subsidiary, Funding I, which it will use to hold the Company’s investments, and a first priority continuing security interest in, to and under each investment, all underlying investments and underlying assets has been granted to BNP to be used as collateral for the BNP Credit Facility. During the BNP Credit Facility’s revolving period (earlier of the termination by the borrower or twelve-month anniversary of the closing date), it bears interest at LIBOR plus 175 basis points. The Company began transferring investments into Steele Creek Funding I, LLC in October 2020.

Funding I is required to pay an administrative agent fee equal to $25 thousand per annum and a structuring fee equal to 0.25% of the Maximum Facility Amount paid on the twelve-month anniversary of the closing date. Additionally, an unused fee is payable quarterly in arrears in an amount equal to 0.70% on the actual daily unused amount greater than 20% of the Maximum Facility Amount under the BNP Credit Facility from April 13, 2021 to the end of the revolving period.

On April 29, 2021, Funding I executed an amendment to the BNP Credit Facility. The amendment solidified the LIBOR transition to Secured Overnight Financing Rate (“SOFR”) for the planned discontinuation of LIBOR. The amendment also increased the Individual Lender Maximum Facility Amount from $45,000 thousand to $80,000 thousand.

On October 28, 2021, the Company executed an additional amendment to the Credit Agreement. Material amendments included the revolving period being extended 36 months, from 12 months to 48 months and the interest rate being reduced from LIBOR plus 175 basis points to LIBOR plus 140 basis points. The advance rate was increased from 67.5% to 70% and expanded to include a triple C bucket with a 60% advance rate. The structuring fee was increased from 0.25% of the Maximum Facility Amount to 0.50% of the Maximum Facility Amount and will be paid in three equal installments (December 2021, December 2022, and December 2023). Updates were made to allow for more flexibility to move capital out of the facility subject to certain covenants. Except as described above, all other terms and provisions of the Agreement remain in full force and effect.

On March 22, 2022, the Company amended the Credit Agreement between Steele Creek Capital Funding I, LLC, BNP Paribas, and the Company as dated October 13, 2020 and as previously amended, (the “Agreement”). Material amendments to the Agreement include the interest rate being converted from LIBOR plus 140 basis points to SOFR plus 140 basis points plus 15 basis points. In addition, the Individual Lender Maximum Facility Amount increased from $80,000 thousand to $95,000 thousand and the language and requirements related to the Agreed Upon Procedures provided by independent accountants were amended to be more appropriate for the underlying collateral.

37

On August 23, 2022, the Company amended the Credit Agreement between Steele Creek Capital Funding I, LLC, BNP Paribas, and the Company as dated October 13, 2020 and as previously amended, (the “Agreement”). This amendment contained certain conforming changes that are not material.

On July 10, 2023, the Company amended the Credit Agreement between Steele Creek Capital Funding I, LLC, BNP Paribas, and the Company as dated October 13, 2020 and as previously amended. This amendment contained certain conforming changes that are not material.

 

The Companyrevolving period of the BNP Credit Facility ends on October 28, 2025, unless terminated earlier by the Company. The maturity date of the BNP Credit Facility is a pass-through entity. Accordingly, no federal income taxes are assessed atthe earliest to occur of (a) October 28, 2026, and (b) the date on which the BNP gives notice to the Company, level. Federal income tax lawthe Collateral Manager and regulations require the partnersEquityholder following the occurrence of and during the continuation of an Event of Default that the entire Outstanding Principal Amount of Loans shall be due and payable. The stated maturity of October 28, 2026 may not be extended.

As of March 31, 2024 and December 31, 2023, there was $83,136 and $86,316 thousand outstanding, respectively, and $11,864 thousand and $8,684 thousand available, respectively, to report their allocable sharebe drawn under the BNP Credit Facility. As of March 31, 2024 and December 31, 2023, the BNP Credit Facility had a fair value of $83,136 thousand and $86,316 thousand, respectively, and a weighted average interest rate of 6.88% and 6.59%, respectively. The fair value of the Company’s taxable income or loss in their respective tax returns. Certain state and local tax authorities levy taxes on the Company based on its income.

The Company accounts for income taxesBNP Credit Facility is determined in accordance with ASC 740, “Accounting for Income Taxes” rates in effect for the year in820, which the differences are expected to reverse. Such cumulative net tax effects on temporary differences are reflected on the Company’s special purpose combined financial allowance when the Company believes that it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

ASC 740 prescribes a two-step approach for the recognition and measurement of tax benefits associated with the positions taken or expected to be taken in a tax return that affect amounts reported in the consolidated financial statements. The Company has reviewed and will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. For the tax period July 1, 2020 (commencement of operations) to September 30, 2020, no unrecognized tax benefit was recorded. To the extent that the Company’s assessment of the conclusions reached regarding uncertain tax positions changes as a result of the evaluation of new information, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax-related interest and penalties, if applicable, as a component of income tax expense. For the period ended September 30, 2020, no such amount was recorded.

7. RELATED PARTY TRANSACTIONS

All three Members of the Company are related parties of the Manager. During the period July 1, 2020 (commencement of operations) through September 30,2020, the Members contributed $20,499,718 of cash and $2,858,282 of assets to the Company in exchange for equity in the Company. Assets contributed to the Company were contributed atdefines fair value in accordanceterms of the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions and is measured with Financial Accounting Standards No.116, Accounting for Contributions ReceivedLevel 2 inputs. As of March 31, 2024 and Contributions Made.


MSC Capital LLC

Notes toDecember 31, 2023, Funding I was in compliance with all covenants of the Consolidated Financial Statements (Unaudited)

For the period July 1, 2020 (commencement of operations)

Through September 30, 2020BNP Credit Facility.

 

Separate fromFor the contributions made above, the Company may, from time to time, purchase investments from, or sell investments to affiliatesthree months ended March 31, 2024 and 2023, we incurred interest and debt financing expense of our Manager at fair value on the trade date. During the period ended July 1, 2020 (commencement of operations), to September 30, 2020, there were no purchases of investments from or sales of investments to affiliates of our Manager.

Prior to the Company’s conversion to a corporation$1,485 thousand and election to be treated as a BDC, the Company did not pay the Manager$1,302 thousand, respectively. The average debt outstanding for the services it provided to the Company. Similarly, the affiliated directorsthree months ended March 31, 2024 and officers of the Company did not receive compensation from the Company.2023 was $83,453 thousand and $82,917 thousand, respectively.

  

8. SHAREHOLDERS’ EQUITY

The Members are affiliates of the Company. For the period from July 1, 2020 (commencement of operations) through September 30, 2020, the Company issued 22,828 shares at a par value of $1,000.00 per share. The Manager has 1 management share in the Company and does not receive any economics.

9. ALLOCATION OF PROFITS AND LOSSES

Members are issued shares of the Company by the Manager that represent their limited liability company interests in the Company. Profits and losses are allocated on a pro-rata basis to all Members based on the number of shares held by each member in proportion to the aggregate number of all outstanding shares of the Company.

10. COMMITMENTS AND CONTINGENCIES

 

Commitments to extend credit include loan proceeds we are obligated to advance, such as delayed draws. Commitments generally have fixed expiration dates or other termination clauses. Unrealized gains or losses associated with unfunded commitments are recorded in the consolidated financial statements and reflected as an adjustment to the fair value of the related security in the Consolidated Schedule of Investments. The par amount of the unfunded commitments is not recognized by the Company until the commitment becomes funded. As of September 30, 2020,March 31, 2024 and December 31, 2023, the Company had no unfunded commitments of $265,031.commitments.

 

In the ordinary course of business, we may be a party to certain legal proceedings, including actions brought against us and others with respect to investment transactions. The outcomes of any such legal proceedings are uncertain and, as a result of these proceedings, the values of the investments to which they relate could decrease. We were not subject to any litigation against us as of September 30, 2020.March 31, 2024. The debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and neither the Members nor any other person or entity shall be obligated personally for any such debt, obligation or liability of the Company.

 


MSC Capital LLC

Notes to the Consolidated Financial Statements (Unaudited)38

For the period July 1, 2020 (commencement of operations)

Through September 30, 2020

 

11.

9. FINANCIAL HIGHLIGHTS

 

The following financial highlights for the period July 1, 2020 (commencement of operations) through September 30, 2020 are calculated for the Membersshareholders as a whole.

 

 For the
period from
July 1,
2020
(commencement of operations) through
September 30,
2020		  Three months
ended
March 31,
2024		  Three months
ended
March 31,
2023		  Three months
ended
March 31,
2022		  Three months
ended
March 31,
2021		 
Per share data:             
Net asset value at beginning of period $-  $9.71  $8.93  $10.90  $10.76 
Net investment income (1)  6.51   0.19   0.21   0.14   0.02 
Net realized gain (1)  13.66   0.00   (0.07)  0.02   0.28 
Net change in unrealized appreciation (1)  21.88 
Net increase in net assets resulting from operations (1)  42.05 
Net change in unrealized (depreciation) (1)  (0.15)  0.29   (0.26)  - 
Net (decrease) increase in net assets resulting from operations (1)  0.04   0.43   (0.10)  0.30 
Stockholder distributions from income (2)  (0.19)  (0.19)  (0.17)  (0.16)
Issuance of common shares  1,000.00   -   -   -   0.01 
Other (2)  10.05 
Other (3)  -   0.01   0.01   0.02 
Net asset value at end of period $1,052.10  $9.56  $9.18  $10.64  $10.93 
                    
Net assets at end of period $24,017,398  $61,119  $52,394  $52,835  $29,571 
Shares outstanding at end of period  22,828   6,390,590   5,710,410   4,964,238   2,706,393 
Total return (3)   5.21%
Total return (2)  0.47%  4.96%  (0.88)%  3.06%
                    
Ratio/Supplemental data:                    
Ratio of net expenses to average net assets (4)  2.91%
Ratio of net expenses excluding waivers and reversals to average net assets (4)  15.07%  15.76%  8.71%  12.00%
Ratio of net expenses including waivers and reversals to average net assets (4)  14.90%  15.64%  8.29%  11.37%
Ratio of net investment income to average net assets (4)  2.46%  7.74%  9.75%  3.67%  1.27%
    
Portfolio turnover (5)  216.46%  63.8%  39.0%  42.6%  183.9%

 

(1)The per share data was derived by using the weighted average shares outstanding during the period.

(2)Includes the impact of different share amounts used in calculating per share data as a result of calculating certain per share data based on weighted average shares outstanding during the period and certain per share data based on shares outstanding as of a period end or transaction date.
(3)Total return is calculated as the change in net asset value (“NAV”) per share during the period, plus distributions per share, if any, divided by the beginning NAV per share. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at the quarter end NAV per share preceding the distribution. Return calculations are not annualized.

(4)(3)Includes the impact of different amounts used in calculating per share data as a result of calculating certain per share data based on weighted average shares outstanding during the period and certain per share data based on shares outstanding as of a period end or transaction date.

(4)Ratios are annualized.

(5)Portfolio turnover rate is calculated using the lesser of year-to-date sales or year-to-date purchases over the average of the invested assets at fair value for the periods reported. Ratio is not annualized.

 


MSC Capital LLC

Notes to the Consolidated Financial Statements (Unaudited)39

For the period July 1, 2020 (commencement of operations)

Through September 30, 2020

 

12.

10. SUBSEQUENT EVENTS

 

Management has evaluated subsequent events through the date of issuance of these consolidated financial statements and has determined that there are no subsequent events outside the ordinary scope of business that require adjustment to, or disclosure in, the consolidated financial statements other than those disclosed below.

 

On October 7, 2020, the Company converted to a Maryland corporation, named Steele Creek Capital Corporation. On that date, the Company elected to be regulated as a BDC under the 1940 Act. The Company will elect for federal income tax purposes to be treated as a regulated investment company (“RIC”) under the Internal Revenue Code of 1986, as amended (the “Code”). The Company will be externally managed by Steele Creek Investment Management LLC (the “Advisor”). The Company entered into an investment advisory agreement (the “Advisory Agreement”) with the Advisor and will compensate the Advisor for its services with a fee that consists of two components: a management fee and an incentive fee. In connection with the conversion, 22,828 of the Company’s $1,000.00 par value shares were converted into 2,282,787.33 of the Company’s $0.001 par value common stock.

On October 13, 2020, the Company entered into a Credit Agreement with BNP Paribas (“BNP”) as lender and administrative agent (the “Credit Facility”) providing a maximum of $45,000,000 to the borrower. During the Credit Facility’s revolving period, it bears interest at London Interbank Offered Rate, or LIBOR, plus 200 basis points. The Company created a wholly owned subsidiary, Steele Creek Capital Funding I, LLC, which it will use to hold the Company’s investments, and a first priority continuing security interest in, to and under each investment, all underlying investments and underlying assets has been granted to the BNP to be used as collateral for the Credit Facility. The Company began transferring investments into Steele Creek Funding I, LLC in October.

On DecemberApril 1, 2020,2024, the Company issued and sold 350,443.435,910 shares of its common stock to certain investors for an aggregate offering price of $3,750,000.$57 thousand. The sale of its common stock was made pursuant to subscription agreements between the Company and the investor. Theinvestors, and the issuance of the common stock was exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof and Regulation D thereunder.

 

The transmission of COVID-19On April 17, 2024, the Company paid approximately $571 thousand for the approximately 59,713 shares tendered and efforts to contain its spread have resulted in, among other things, border closings and other significant travel restrictions and disruptions, significant disruptions to business operations, supply chains and customer activity, lower consumer demand for goods and services, event cancellations and restrictions, service cancellations, reductions and other changes, significant challenges in healthcare service preparation and delivery, and prolonged quarantines, as well as general concern and uncertainty. The impactaccepted at the close of the COVID-19 outbreak could negatively affectMarch 2024 tender offer.

On May 1, 2024, the global economy, the economiesCompany issued and sold 18,127 shares of individual countries, and the financial performance of individual issuers, sectors, industries, asset classes, and markets in significant and unforeseen ways. The COVID-19 pandemic and its effects may lastcommon stock to certain investors for an extended periodaggregate offering price of time, and in either case could result in significant market volatility, exchange trading suspensions and closures, declines in global financial markets, higher default rates, and a substantial economic downturn or recession.$175 thousand. The foregoing could disrupt the operationssale of its common stock was made pursuant to subscription agreements between the Company and its service providers, adversely affect the valueinvestors, and liquiditythe issuance of the Company’s investments, and negatively impactcommon stock was exempt from the Company’s performance and your investment in the Company.

The global impactregistration requirements of the pandemic has been rapidly evolvingSecurities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof and may negatively impact the performance of the Company.Regulation D thereunder.

 


40

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.Operations

 

The following discussion and analysis should be read in conjunction with our consolidated financial statements and related notes and other financial information appearing elsewhere in this Quarterly Report on Form 10-Q. Except as otherwise specified, references to “we,” “us,” “our,” or the “Company” refer to MSC Capital LLC prior to the Conversion (as defined herein), and Steele Creek Capital Corporation on and after the Conversion.

 

Forward-Looking Statements

 

Some of the statements in this report constitute forward-looking statements that involve substantial known and unknown risks, uncertainties and other factors. Undue reliance should not be placed on such statements. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our company, our current and prospective portfolio investments, our industry, our beliefs and our assumptions. Words such as “anticipates,” “expects,” “intends,” “plans,” “will,” “may,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “should,” “targets,” “projects,” and variations of these words and similar expressions are intended to identify forward-looking statements. Our actual results could differ materially and these statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including:

 

●uncertainties associated with the coronavirus (“COVID-19”) pandemic, including the negative effect that the COVID-19 pandemic is having and is expected to have on the credit markets and the negative effect that the COVID-19 pandemic could have on our business;

●our future operating results;

●our business prospects and the prospects of our portfolio companies;

●the impact of investments that we expect to make;

●changes in political, economic or industry conditions, the interest rate environment or conditions affecting the financial and capital markets;

●the ability of the Steele Creek Investment Management LLC (the “Advisor”“Investment Advisor”) to locate suitable investments for us and to monitor and administer our investments;

●the ability of the Investment Advisor and its affiliates to attract and retain highly talented professionals;

●risk associated with possible disruptions in our operations or the economy generally;

●the timing of cash flows, if any, from the operations of the companies in which we invest;

●the adequacy of our cash resources and working capitalcapital;

●the ability of the companies in which we invest to achieve their objectives;

●the dependence of our future success on the general economy and its effect on the industries in which we invest;

●our ability to qualify and maintain our qualification as a BDC and as a regulated investment company (“RIC”)RIC under the Internal Revenue Code of 1986, as amended (the “Code”);Code;

●the use of borrowed money to finance a portion of our investments;

●the adequacy, availability and pricing of our financing sources and working capital;

●actual or potential conflicts of interest with the Investment Advisor and its affiliates;

●our contractual arrangements and relationships with third parties;

●our expected financings and investments;

●the economic downturn, interest rate volatility, loss of key personnel, and the illiquid nature of our investments; and

●the risks, uncertainties and other factors we identify under “Item 1A. Risk Factors” and elsewhere in this quarterly report on Form 10-Q.

 

41

We have based the forward-looking statements included in this report on information available to us on the date of this report, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make directly to you or through reports that we may file with the U.S. Securities and Exchange Commission (“SEC”) in the future, including any annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.

 


Although we believe that the assumptions on which these forward-looking statements are based are reasonable, any of the assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those assumptions also could be inaccurate. In particular, statements herein about the effects of the COVID-19 pandemic on our business, results, financial position, and liquidity may constitute forward-looking statements and are subject to the risk that the actual impact may differ, possibly materially, from what is currently estimated. In addition, new risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this report should not be regarded as a representation by us that our plans and objectives will be achieved. These risks and uncertainties include those described or identified in the section entitled “Item 1A. Risk Factors” and elsewhere in this report. You should not place undue reliance on these forward-looking statements, which apply only as of the date of this report. Moreover, we assume no duty and do not undertake to update the forward-looking statements.

 

Overview

 

We were organized as a Delaware limited liability company pursuant to the Delaware Limited Liability Company Act (the “LLC Act”) by filing a Certificate of Formation in the Office of the Secretary of State of the State of Delaware on June 3, 2020. We operate under the Amended and Restated Limited Liability Agreement of MSC Capital LLC (the “Agreement”).

The Company intends to elect to be treated as a business development company under the Investment Company Act of 1940, as amended (the “1940 Act”).

The Company shall have perpetual existence unless sooner dissolved pursuant to Section 17 of the Agreement, or by the entry of a decree of judicial dissolution under Section 18-802 of the LLC Act.

The Company has no paid employees and is managed by Steele Creek Investment Management LLC (the “Manager”). The debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and neither the Members nor any other person or entity shall be obligated personally for any such debt, obligation or liability of the Company.

The Company isare a financial services company that primarily invests in syndicated corporate bank loans, bonds, other debt securities, and structured products. TheWe are an externally managed, non-diversified, closed-end management investment company that has elected to be regulated as a BDC and has elected to be treated for U.S. federal income tax purposes, and to qualify annually thereafter, as a RIC under the Code. We were formed on June 3, 2020 as a Delaware limited liability company under the name MSC Capital LLC. MSC Capital LLC was formed by Steele Creek Investment Management LLC, Moelis Asset and two affiliates. On October 7, 2020, MSC Capital LLC converted to a Maryland corporation (the “Conversion”), named Steele Creek Capital Corporation. On September 3, 2020, we formed a wholly-owned consolidated special purpose financing vehicle, Steele Creek Capital Funding I, LLC, a Delaware limited liability company.

Our investment objective is to generate high current income by investing primarily in fixed income instruments, including broadly syndicated bank loans, structured products, mezzanine financings and senior secured bonds. We provide moderate liquidity to our shareholders by offering a quarterly share repurchase program. As of March 31, 2024, approximately 192 thousand shares have been tendered through the share repurchase program. Broadly syndicated loans are generally more liquid than directly originated investments and may provide more attractive financing terms than less liquid assets. Mezzanine financings are generally unrated or below investment grade rated investments that have greater credit and liquidity risk than more highly rated debt obligations. Moreover, mezzanine financings are generally unsecured and subordinate to other obligations of the obligor and are subject to many of the same risks as those associated with high-yield debt securities.

 

Revenues

 

We plan to generate revenue primarily in the form of interest and fee income on debt investments we hold and capital gains, if any, on investments. We generally expect our debt investments to bear interest at a floating rate usually determined on the basis of a benchmark such as LIBOR.the London Inter-Bank Offered Rate (“LIBOR”) or Secured Overnight Financing Rate (“SOFR”). Interest on debt securities is generally payable monthly, quarterly or semi-annually. In some instances, we expect to receive payments on our debt investments based on scheduled amortization of the outstanding balances. In addition, we may receive repayments of some of our debt investments prior to their scheduled maturity date. The frequency or volume of these repayments is expected to fluctuate significantly from period to period. Our portfolio activity is also expected to reflect the proceeds of sales of securities. We may also generate revenue in the form of commitment, origination, amendment, structuring or due diligence fees, fees for providing managerial assistance and consulting fees.

 


42

Expenses

 

Our primary operating expenses will include the payment of fees to theour Investment Advisor under the investment advisory agreement between the CompanyInvestment Advisory Agreement, and the Advisor (the “Advisory Agreement”), our allocable portion of overhead and rental expenses under the Administration Agreement and other operating costs described below. We will bear all other out-of-pocket costs and expenses of our operations and transactions, including:

 

●our initial organization costs incurred prior to the commencement of our operations;

●operating costs incurred prior to the commencement of our operations;

●the cost of calculating our net asset value, including the cost of any third-party valuation services;

●the cost of effecting sales and repurchases of shares of our common stock and other securities, including in connection with the Private Offering;

●distribution and shareholder servicing fees payable to our dealer manager and financial intermediaries;

●fees payable to third parties relating to making investments, including our Investment Advisor’s or its affiliates’ travel expenses, research costs and out-of-pocket fees and expenses associated with performing due diligence and reviews of prospective investments;

●interest expense and other costs associated with our indebtedness;

●transfer agent and custodial fees;

●out-of-pocket fees and expenses associated with marketing efforts;

●federal and state registration fees and any stock exchange listing fees;

●U.S. federal, state and local taxes;

●Independent Directors’ fees and expenses;

●brokerage commissions and markups;

●fidelity bond, directors’ and officers’ liability insurance and other insurance premiums;

●direct costs, such as printing, mailing, long distance telephone and staff;

●fees and expenses associated with independent audits and outside legal costs;

●costs associated with our reporting and compliance obligations under the 1940 Act and other applicable U.S. federal and state securities laws; and

●other expenses incurred by the Administrator or us in connection with administering our business, including payments under the Administration Agreement that will be based upon our allocable portion (subject to the review and approval of our Board) of overhead, including rental expensesoverhead.

 

43

From time to time, the Administrator or its affiliates may pay third-party providers of goods or services. We will reimburse the Administrator or such affiliates thereof for any such amounts paid on our behalf under the Administration Agreement. All of the foregoing expenses will ultimately be borne by our stockholders.

Our Investment Advisor is authorized to determine the broker to be used for each portfolio transaction. In selecting brokers to execute transactions, the Investment Advisor need not solicit competitive bids and does not have an obligation to seek the lowest available commission cost. In selecting brokers, the Investment Advisor may or may not negotiate “execution only” commission rates and thus we may be deemed to be paying for other services provided by the broker that are included in the commission rate. In negotiating commission rates, the Investment Advisor will take into account the financial stability and reputation of the broker and the brokerage, research and other services provided to us, the Investment Advisor and other customers of the Investment Advisor and its affiliates by such broker, even though we may not, in any particular instance, be the direct or indirect beneficiaries of the research or other services provided and the management fee payable to the Investment Advisor is not reduced because it receives such services. In addition, the Investment Advisor may direct commissions to certain brokers that on the foregoing basis may furnish other services to us, the Investment Advisor and other customers of the Investment Advisor and its affiliates, such as telephone lines, news and quotation equipment, electronic office equipment, account record keeping and clerical services, trading software, financial publications and economic consulting services. As a result of the brokerage practices described above, the levels of commission paid, and prices paid or received by us in portfolio transactions may be less favorable than in portfolio transactions effected on a best price and execution basis.

 

Compensation Paid to the Dealer Manager and Participating Financial Intermediaries

The Company has engaged S2K Financial LLC as dealer manager to assist with the placement of the Company’s shares (“Dealer Manager”). Investors will pay a maximum upfront sales load of up to 5.5% of the Company’s net asset value per share for combined upfront selling commissions and dealer manager fees. Investors will pay a maximum upfront selling commission of 3.0% and a maximum dealer manager fee of 2.5%. The purchase price paid by an investor will be the Company’s net asset value per share plus all upfront selling commissions and dealer manager fees. All or a portion of selling commissions and dealer manager fees may be reduced or eliminated in connection with certain categories of sales such as, without limitation, sales through investment advisers or sales to our affiliates.

The Company will pay to the Dealer Manager a shareholder servicing fee (“Shareholder Servicing Fee”) at a maximum annual rate equal to 0.0% of the Company’s net assets up to $28,200 thousand and of 1.0% of the Company’s net assets over $28,200 thousand. The Shareholder Servicing Fee will be payable on a monthly basis. With respect to each share sold, the Shareholder Servicing Fee will be paid until the third anniversary of the applicable month of purchase. All or a portion of which may be reallowed by the Dealer Manager to participating Financial Intermediaries. The purpose of the Shareholder Servicing Fee is to reimburse our Dealer Manager for costs incurred by selected Financial Intermediaries and investment representatives for providing ongoing shareholder services. The Shareholder Servicing Fee is paid pursuant to a Servicing Plan adopted by the Board, including a majority of the Independent Directors and who have no direct or indirect financial interest in the operation of the Servicing Plan or in any agreements entered into in connection therewith. The Servicing Plan will remain in effect for so long as such continuance is reapproved annually by the Board.

The Investment Advisor or its affiliates, in Investment Advisor’s discretion and from their own resources, will pay additional compensation to our Dealer Manager in connection with the sale and servicing of shares (“Additional Compensation”). In return for the Additional Compensation, the Company may receive certain marketing advantages. Our Dealer Manager may reallow all or a portion of the Additional Compensation to participating Financial Intermediaries. The Additional Compensation will not be paid by our shareholders.

Current Market Conditions

 

SinceAbating recession fears led to robust inflows into the leveraged loan market during the first portfolio investments were committed to in the beginningquarter of July 2020, we have seen improving market conditions as fiscal2024 from strong CLO issuance and monetary stimulus alongside business re-openings have driven a fast-paced recovery in risk assets. As the durationpositive loan mutual fund flows. Borrowers took advantage of the COVID-19 pandemic remains uncertain and could continue to cause disruption in the global economy and financial markets, broadly syndicated loans have largely been bifurcated between issuers with operations significantly diminished by governmental restrictions and those with operations continuing to function. Furthermore, issuers of scale critical to their supply chain that are currently experiencing significant operational disruption are still having success accessing liquidity from the credit markets in many cases.


With a favorable technical backdrop with opportunistic repricing/refinancing activity, which represented most of the broadly syndicated loan market was receptive to opportunistic activityissuance volume in the 3rdquarter. The Credit Suisse Leveraged Loan index ended the quarter up 2.52% with an average bid price of 2020, which led to an array of new issue transactions including leveraged buyouts, strategic acquisitions, refinancing’s and dividend recapitalizations. However, a spike in COVID-19 cases that forces a significant portion of the U.S. into a lockdown or the absence of a smooth transition of presidential power could lead to increased volatility and greatly diminish capital markets activity. This possible outcome may result in additional portfolio investments being sourced predominantly in the secondary market.

While market volatility can impact portfolio investment valuations, our institutional credit facility does not include a mark-to-market covenant. Access to the credit facility will be available as long as eligibility covenants are maintained.

To safeguard the health of our employees and to ensure continuity of our business operations on behalf of our investors, the Company and its advisor have maintained a remote work environment that has not incurred any disruption to the portfolio management, trading, research or operations and accounting functions of the Company. 

COVID-19 Developments

The transmission of COVID-19 and efforts to contain its spread have resulted in, among other things, border closings and other significant travel restrictions and disruptions, significant disruptions to business operations, supply chains and customer activity, lower consumer demand for goods and services, event cancellations and restrictions, service cancellations, reductions and other changes, significant challenges in healthcare service preparation and delivery, and prolonged quarantines, as well as general concern and uncertainty. The impact of the COVID-19 outbreak could negatively affect the global economy, the economies of individual countries, and the financial performance of individual issuers, sectors, industries, asset classes, and markets in significant and unforeseen ways. The COVID-19 pandemic and its effects may last for an extended period of time, and in either case could result in significant market volatility, exchange trading suspensions and closures, declines in global financial markets, higher default rates, and a substantial economic downturn or recession. The foregoing could disrupt the operations of the Company and its service providers, adversely affect the value and liquidity of the Company’s investments, and negatively impact the Company’s performance and your investment in the Company.

LIBOR Developments

On July 27, 2017, the Financial Conduct Authority (“FCA”) announced that it would phase out the London Interbank Offered Rate (“LIBOR”) as a benchmark by96.01, up from 95.32 at the end of 2021Q4. The trailing twelve-month default rate increased to 3.8% from 3.4% in Q1 according to Fitch Ratings and the FCA has indicated thatratio of rating agency downgrades to upgrades for the loan market participants should not rely on LIBOR being available after 2021. As an alternative to LIBOR, for example, the U.S. Federal Reserve, in conjunction with the Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions, is considering replacing U.S.-dollar LIBOR with the Secured Overnight Financing Rate (“SOFR”), a new index calculated by short-term repurchase agreements, backed by Treasury securities. Abandonment of or modifications to LIBOR could have adverse impacts on newly issued financial instruments and our existing financial instruments which reference LIBOR. Uncertainty as to the nature of alternative reference rates and as to potential changes or other reforms to LIBOR, or any changes announced with respect to such reforms, may result in a sudden or prolonged increase or decreaseedged higher in the reported LIBOR rates and the value of LIBOR-based loans and securities, including those of other issuers we or our funds currently own or may in the future own. It remains uncertain how such changes would be implemented and the effects such changes would have on us, issuers of instruments in which we invest and financial markets generally.

The expected discontinuation of LIBOR could have a significant impact on our business. The dollar amount of our outstanding debt investments and borrowings that are linkedquarter to LIBOR with maturity dates after the anticipated discontinuation date of 2021 is material. We anticipate significant operational challenges for the transition away from LIBOR including, but not limited to, amending existing loan agreements with borrowers on investments that may have not been modified with fallback language and adding effective fallback language to new agreements in the event that LIBOR is discontinued before maturity. Beyond these challenges, we anticipate there may be additional risks to our current processes and information systems that will need to be identified and evaluated by us. Due to the uncertainty of the replacement for LIBOR, the potential effect of any such event on our cost of capital and net investment income cannot yet be determined. In addition, any further changes or reforms to the determination or supervision of LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR, which could have an adverse impact on the market value for or value of any LIBOR-linked securities, loans, and other financial obligations or extensions of credit held by or due to us and could have a material adverse effect on our business, financial condition, and results of operations.1.6:1 vs. 1.3:1.

 


44

Portfolio and Investment Activity

 

As of September 30, 2020,March 31, 2024, our portfolio had a fair market value of $26,726,554,approximately $140,676 thousand, a cost basis of $26,383,346approximately $145,405 thousand and was comprised of leveraged loans,investments, measured at fair value (the “Loan Portfolio”). The Loan Portfoliovalue. Our loan portfolio consisted of 32 portfolio companies209 investments in 19 industries.26 industries and in 9 domiciled countries. The following table depicts a summary of the portfolio as of September 30, 2020:March 31, 2024 (in thousands):

 

Investments
Cost26,383,346
Cumulative Net Unrealized Appreciation343,208
Fair Value26,726,554
Yield at Cost5.30%
  Investments 
Cost $145,405 
Cumulative Net Unrealized Depreciation  (4,729)
Fair Value $140,676 
Yield at Cost  9.14%

 

As of September 30, 2020,December 31, 2023, our portfolio had a fair market value of approximately $138,533 thousand, a cost basis of approximately $142,333 thousand and was comprised of investments, measured at fair value. Our loan portfolio consisted of 205 investments in 26 industries and in 8 domiciled countries. The following table depicts a summary of the portfolio as of December 31, 2023 (in thousands):

  Investments 
Cost $142,333 
Cumulative Net Unrealized Depreciation  (3,800)
Fair Value $138,533 
Yield at Cost  9.46%

As of March 31, 2024, 100.0% of the term loan investments in the portfolio bore interest at floating rates, with 89.0%62.6% of our loan portfolio (at fair value) and 88.8%62.2% of our loan portfolio (at cost) having an interest rate floor. The compositionfloor above 0.0%. Recent interest rate increases announced in the United States have driven the SOFR base rates above the floors in effect as of quarter end. Base rates on 100.0% of the loans in the portfolio exceed the stated floors.

As of December 31, 2023, 100.0% of the term loan investments in the portfolio bore interest at floating rates, with 72.4% of our floating rate loan portfolio by(at fair value) and (at cost) having an interest rate floor above 0.0%. Recent interest rate increases announced in the United States have driven the SOFR base rates above the floors in effect as of September 30, 2020 was as follows:year-end. Base rates on 100.0% of the loans in the portfolio exceed the stated floors. 

 

  September 30, 2020 
  Fair Value  % of Floating
Rate Portfolio		  Cost  % of Floating
Rate Portfolio		 
0.00%  2,944,208   11.02%  2,957,303   11.21%
0.75%  6,084,669   22.77%  5,999,164   22.74%
1.00%  17,697,677   66.22%  17,426,878   66.05%
   26,726,554   100.00%  26,383,346   100.00%

The portfolio is actively managed, with a turnover ratio of 216.46%63.8% and 39.0% for the period July 1, 2020 (commencement of operations) through September 30, 2020. During the period July 1, 2020 (commencement of operations) through September 30, 2020, Loan Portfoliothree months ended March 31, 2024 and 2023, respectively. Our loan portfolio rotation was reflective of the active management style, which seeks to optimize the portfolio based on current market conditions by rotating into positions that have better relative values. We do not expect to maintain this level of turnover ratio as this level is inflated due to the ramping of the portfolio. However, this high level does provide an indication of the liquidity in our portfolio and the leverage loan market. The annualized average yield during period July 1, 2020 (commencementas of operations) through September 30, 2020March 31, 2024 and 2023 on the investment was 5.30%.9.45% and 9.62%, respectively. The following tables depict the portfolio activity for the period July 1, 2020 (commencement of operations) through September 30, 2020:(in thousands).

  Investments 
Fair Value, Beginning $- 
Investment contributions  2,858,282 
Purchases  69,071,588 
Sales and Repayments  (45,806,471)
Non-cash income accrual  45,811 
Net realized gains (losses)  214,136 
Net unrealized appreciation  343,208 
Fair Value, Ending $26,726,554 

 


Investments
Portfolio Companies, Beginning-
Investment contributions3
Purchases (new)57
Purchases (add-on to existing)1
Complete exit(29)
Portfolio Companies, Ending32
  Three months
ended
March 31,
2024		  Three months
ended
March 31,
2023		 
Fair Value, Beginning $138,533  $127,619 
Purchases  92,086   49,931 
Sales and Repayments  (89,108)  (50,480)
Payment in-kind income  4   18 
Non-cash income accrual  77   119 
Net realized gains (losses)   13   (418)
Net unrealized (depreciation) appreciation  (929)  1,666 
Fair Value, Ending $140,676  $128,455 

 

45

  Three months
ended
March 31,
2024		  Three months
ended
March 31,
2023		 
Investments, Beginning  205   164 
Purchases (new)  79   42 
Complete exit  (75)  (39)
Investments, Ending  209   167 

The portfolio was diversified across both issuers and industries with the average investment exposure to an individual obligor in our Loan portfolio of $0.8 million$673 thousand at fair value, or 3.1%0.5% of the total portfolio, as of September 30, 2020.the three months ended March 31, 2024. The following table shows the Loanportfolio composition by industry grouping at fair value as a percentage of the total portfolio as of March 31, 2024: 

IndustryAs of
March 31,
2024
Healthcare & Pharmaceuticals14.0%
Services: Business12.6%
Banking, Finance, Insurance & Real Estate12.0%
Construction & Building6.9%
High Tech Industries5.4%
Telecommunications4.8%
Aerospace & Defense4.4%
Chemicals, Plastics & Rubber4.4%
Hotel, Gaming & Leisure4.3%
Transportation: Consumer3.6%
Automotive3.0%
Transportation: Cargo2.9%
Energy: Electricity2.4%
Retail2.4%
Containers, Packaging & Glass2.3%
Energy: Oil & Gas2.1%
Services: Consumer2.0%
Consumer Goods: Durable1.9%
Utilities: Electric1.8%
Capital Equipment1.6%
Media: Broadcasting & Subscription1.5%
Beverages, Food & Tobacco1.2%
Media: Advertising, Printing & Publishing1.2%
Consumer Goods: Non-Durable0.6%
Environmental Industries0.4%
Forest Products & Paper0.3%
100.0%

46

The portfolio was diversified across both issuers and industries with the average investment exposure in our loan portfolio of $676 thousand at fair value, or 0.5% of the total portfolio, as of the year ended December 31, 2023. The following table shows the loan portfolio composition by industry grouping at fair value as a percentage of total Loansloans as of September 30, 2020:December 31, 2023:

 

Industry As of
September 30,
2020
December 31,
2023		 
Services: Business13.4%
Banking, Finance, Insurance & Real Estate  12.912.0%
Healthcare & Pharmaceuticals11.6%
High Tech Industries7.2%
Aerospace & Defense  12.95.6%
Containers, Packaging & GlassTelecommunications  8.54.9%
Transportation: CargoChemicals, Plastics, & Rubber  6.44.5%
AutomotiveHotel, Gaming & Leisure  6.1%
Healthcare & Pharmaceuticals5.7%
Services: Consumer5.6%
Beverage, Food & Tobacco5.5%
High Tech Industries5.34.2%
Transportation: Consumer  3.8%
Forest ProductsConstruction & PaperBuilding  3.7%
Chemicals, Plastics, & RubberConsumer Goods: Durable  3.73.2%
Automotive3.1%
Energy: Oil & Gas2.7%
Transportation: Cargo2.7%
Energy: Electricity  3.72.5%
Retail2.4%
Capital Equipment2.3%
Services: Consumer2.3%
Containers, Packaging & Glass2.1%
Media: Broadcasting & Subscription1.5%
Beverages, Food & Tobacco1.3%
Media: Advertising, Printing & Publishing  3.71.2%
Energy: Oil & GasConsumer Goods: Non-durable  3.7%
Retail3.70.8%
Utilities: Electric  1.80.5%
Media: BroadcastingForest Products & SubscriptionPaper  1.80.3%
Services: BusinessEnvironmental Industries  1.40.2%
   100.0%

 


47

Results of Operations

 

Operating results for the period July 1, 2020 (commencement of operations) through September 30, 2020 were as follows:follows (in thousands):

 

For the
period from
July 1,
2020
(commencement
of operations)
through
September 30,
2020
Investment income:
Interest income211,354
Other income11,088
Total investment income222,442
Expenses:
Professional fees106,250
Custody fees8,014
Administration expenses3,014
Other general and administrative expenses3,110
Total expenses120,388
Net investment income102,054
Net realized gain on investments214,136
Net unrealized appreciation on investments343,208
Net realized and unrealized gain on investments557,344
Net Earnings659,398
  Three months
ended
March 31,
2024		  Three months
ended
March 31,
2023		 
Investment income:      
Interest income $3,449  $3,199 
Payment in-kind interest income  4   18 
Other income  8   - 
Total investment income  3,461   3,217 
         
Expenses:        
Management fees  455   372 
Interest and debt financing expenses  1,485   1,302 
Professional fees  99   95 
Incentive fees  56   76 
Administration expenses  60   58 
Directors’ fees  20   20 
Custody fees  12   12 
Other general and administrative expenses  159   119 
Total expenses  2,346   2,054 
Less: management fees waived  (106)  (52)
Less: incentive fee waived  -   (8)
Net expenses  2,240   1,994 
Net investment income  1,221   1,223 
Net realized (loss) gain on investments  13   (418)
Net unrealized appreciation (depreciation) on investments  (929)  1,666 
Net realized and unrealized gain (loss) on investments  (916)  1,248 
Net increase (decrease) in net assets $305  $2,471 

 

48

Investment Income

 

Investment income of $222,442 is recorded on the accrual basis to the extent that such amounts are expected to be collected. Where applicable, OID and purchased discounts and premiums are accreted into interest income using the effective interest method. Loan origination fees are deferred and accreted into interest income using the effective interest method. We record prepayment premiums on loans and other investments as interest income when such amounts are received. Investment income for the three months ended March 31, 2024 and 2023 was approximately $3,461 thousand and $3,217 thousand, respectively.

 

Total Expenses

 

Total expenses for the three months ended March 31, 2024 and 2023 of $120,388approximately $2,346 thousand and $2,054 thousand, respectively. Total expenses include administrator fees, custody fees, legal fees,management, incentive, audit and tax servicepreparation fees, organizational costs, offering costs, interest and debt financing costs, directors’ fees, administration expenses third-party valuation fees and other general and administrative expenses. Expenses are recognized on an accrual basis.

 

For the three months ended March 31, 2024, the Investment Advisor waived $106 thousand of management fees and did not waive any income incentive fees. The actions taken by Moelis Asset the Investment Advisor effectively reduced total expenses incurred by the Company for the three months ended March 31, 2024 of approximately $2,346 thousand to approximately $2,240 thousand.

For the three months ended March 31, 2023, the Investment Advisor waived $52 thousand of management fees and $8 thousand of income incentive fees. The actions taken by Moelis Asset and the Investment Advisor effectively reduced total expenses incurred by the Company for the three months ended March 31, 2023 of approximately $2,054 thousand to approximately $1,994 thousand.

Net Realized Gain and Losses on Investments

 

Sales and repayments of investments during the period July 1, 2020 (commencement of operations) through September 30, 2020three months ended March 31, 2024 totaled $45,806,471approximately $89,108 thousand, resulting in net realized gainsgain of $214,136.approximately $13 thousand.

 

Sales and repayments of investments during the three months ended March 31, 2023 totaled approximately $50,480 thousand, resulting in net realized loss of approximately $418 thousand.

Net Unrealized Appreciation or Depreciation on Investments

 

Unrealized depreciation for the three months ended March 31, 2024 totaled approximately $929 thousand. Unrealized appreciation of $343,208during the three months ended March 31, 2023 totaled approximately $1,666 thousand. This activity reflects the changes in fair value of investments as determined in compliance with the Manager’sInvestment Advisor’s valuation policy.


Taxes

 

The Company isWe elected to be treated, and intend to qualify annually to maintain our election to be treated, as a pass-through entity. Accordingly, noRIC under Subchapter M of the Code. To maintain our RIC tax election, we must, among other requirements, meet certain annual source-of-income and quarterly asset diversification requirements. We also must annually distribute dividends for U.S. federal income taxes are assessedtax purposes to our stockholders out of the assets legally available for distribution of an amount generally at least equal to 90% of the Company level. Federalsum of our net ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, or investment company taxable income, determined without regard to any deduction for dividends paid.

49

Although not required for us to maintain our RIC tax status, in order to avoid the imposition of a 4% nondeductible federal excise tax imposed on RICs, we must distribute dividends for U.S. federal income tax lawpurposes to our stockholders in respect of each calendar year of an amount at least equal to the Excise Tax Avoidance Requirement.

Because federal income tax regulations differ from GAAP, distributions in accordance with tax regulations may differ from net investment income and net realized gain recognized for financial reporting purposes. Differences between tax regulations requireand GAAP may be permanent or temporary. Permanent differences are reclassified among capital accounts in the partnersConsolidated Financial Statements to reportreflect their allocable shareappropriate tax character. Temporary differences arise when certain items of the Company’s taxable income, expense, gain or loss are recognized at some time in their respective tax returns. Certain state and local tax authorities levy taxes on the Company based on its income.future.

 

We have formed and expect to continue to form certain taxable subsidiaries, including the Taxable Subsidiary, which are taxed as corporations. These taxable subsidiaries allow us to hold equity securities of certain portfolio companies treated as pass-through entities for U.S. federal income tax purposes while facilitating our ability to qualify as a RIC under the Code.

Financial Condition, Liquidity and Capital Resources

 

We intend to generate cash primarily from the net proceeds of any offering of shares of our common stock and from cash flows from interest and fees earned from our investments and principal repayments and proceeds from sales of our investments. We may also fund a portion of our investments through borrowings from banks and issuances of senior securities, including before we have fully invested the proceeds of the Private Offering. Our primary use of cash will beis investments in portfolio companies, payments of our expenses and payment of cash distributions to our stockholders.

 

Capital Contributions

 

DuringFor the period from July 1, 2020 (Commencement of Operations) through September 30, 2020,three months ended March 31, 2024, the Company issued and sold 22,82873,783 shares of Common Stock with a par value of $0.001 per share for an aggregate offering price of $713 thousand. For the three months ended March 31, 2023, the Company issued and sold 67,337 shares of Common Stock with a par value of $0.001 per share for an aggregate offering price of $615 thousand. 

The sale of its common stock was made pursuant to subscription agreements between the Company and the investors, and the issuance of the common stock was exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof and Regulation D thereunder.

Our shares of common stock constitute illiquid investments for which represented limited liability company intereststhere is not, and will likely not be, a secondary market at any time prior to a public offering and listing of our shares on a national securities exchange. There can be no guarantee that we will conduct a public offering and list our shares on a national securities exchange. Investment in the Company at an aggregate purchase price of $23,358,000.is suitable only for sophisticated investors and requires the financial ability and willingness to be exposed to higher liquidity risk than would be the case were the securities publicly listed and actively traded.

 

We provide moderate liquidity to our shareholders by offering a quarterly share repurchase program. During the three months ended March 31, 2024, approximately 53,915 shares were tendered. During the three months ended March 31, 2023, no shares were tendered.

As of May 10, 2024, 6,354,912 shares of the Company’s Common Stock was issued and outstanding.

Borrowings

October 13, 2020, we entered into a two-year secured revolving Credit Agreement (the “Credit Agreement”) with BNP Paribas (“BNP”) as lender and administrative agent (the “BNP Credit Facility”) providing a maximum of $45,000 thousand (“Maximum Facility Amount”) to Steele Creek Capital Funding I, LLC (“Funding I”). The Company created a wholly owned subsidiary, Funding I, which it will use to hold the Company’s investments, and a first priority continuing security interest in, to and under each investment, all underlying investments and underlying assets has been granted to BNP to be used as collateral for the BNP Credit Facility. During the BNP Credit Facility’s revolving period, it bears interest at LIBOR plus 175 basis points. We believe that our capital resources will provide us with the flexibility to take advantage of market opportunities when they arise. 

50

Funding I is required to pay an administrative agent fee equal to $25 thousand per annum and a structuring fee equal to 0.25% of the Maximum Facility Amount paid on the twelve-month anniversary of the closing date. Additionally, an unused fee is payable quarterly in arrears in an amount equal to 0.70% on the actual daily unused amount greater than 20% of the Maximum Facility Amount under the BNP Credit Facility from April 13, 2021 to the end of the revolving period.

On April 29, 2021, Funding I executed an amendment to the BNP Credit Facility. The amendment solidified the LIBOR transition to SOFR for the planned discontinuation of LIBOR. The amendment also increased the Individual Lender Maximum Facility Amount from $45,000 thousand to $80,000 thousand. 

On October 28, 2021, the Company executed an additional amendment to the Credit Agreement. Material amendments included at this time include the revolving period being extended 36 months, from 12 months to 48 months and the interest rate being reduced from LIBOR plus 175 basis points to LIBOR plus 140 basis points. The advance rate was increased from 67.5% to 70% and expanded to include a triple C bucket with a 60% advance rate. The structuring fee was increased from 0.25% of the Maximum Facility Amount to 0.50% of the Maximum Facility Amount and will be paid in three equal installments (December 2021, December 2022, and December 2023). Updates were made to allow for more flexibility to move capital out of the facility subject to certain covenants. Except as described above, all other terms and provisions of the Agreement remain in full force and effect.

On March 22, 2022, the Company amended the Credit Agreement between Steele Creek Capital Funding I, LLC, BNP Paribas, and the Company as dated October 13, 2020 and as previously amended. Material amendments to the Agreement include the interest rate being converted from LIBOR plus 140 basis points to SOFR plus 140 basis points plus 15 basis points. In addition, the Individual Lender Maximum Facility Amount increased from $80,000 thousand to $95,000 thousand and the language and requirements related to the Agreed Upon Procedures provided by independent accountants were amended to be more appropriate for the underlying collateral.

On August 23, 2022, the Company amended the Credit Agreement between Steele Creek Capital Funding I, LLC, BNP Paribas, and the Company as dated October 13, 2020 and as previously amended. This amendment contained certain conforming changes that are not material.

On July 10, 2023, the Company amended the Credit Agreement between Steele Creek Capital Funding I, LLC, BNP Paribas, and the Company as dated October 13, 2020 and as previously amended. This amendment contained certain conforming changes that are not material.

For the three months ended March 31, 2024 and 2023, we had an average of $83,453 thousand and $82,917 thousand outstanding under the BNP Credit Facility, respectively.

The revolving period of the BNP Credit Facility ends on October 28, 2025, unless terminated earlier by the Company. The maturity date of the BNP Credit Facility is the earliest to occur of (a) October 28, 2026, and (b) the date on which the BNP gives notice to the Company, the Collateral Manager and the Equityholder following the occurrence of and during the continuation of an Event of Default that the entire Outstanding Principal Amount of Loans shall be due and payable. The stated maturity of October 28, 2026 may not be extended.

Distribution Policy

 

To the extent that we have income available, we intend to distribute quarterly dividends to our stockholders. Our quarterly dividends, if any, will be determined by our Board. Any dividends to our stockholders will be declared out of assets legally available for distribution.

 

We intend for the Company to elect to be treated, and intend to qualify annually thereafter, as a RIC under the Code. To obtain and maintain RIC tax treatment, among other things, we must distribute dividends to our stockholders in respect of each taxable year of an amount at least equal to 90% of the sum of our net ordinary income and net short-term capital gains in excess of our net long-term capital losses (“investment company taxable income”), determined without regard to any deduction for dividends paid. In order to avoid certain excise taxes imposed on RICs, we currently intend to distribute dividends to our stockholders in respect of each calendar year of an amount at least equal to the sum of: (1) 98% of our net ordinary income (taking into account certain deferrals and elections) for such calendar year; (2) 98.2% of our capital gains in excess of capital losses (“capital gain net income”), adjusted for certain ordinary losses, generally for the one-year period ending on October 31 of such calendar year; and (3) any net ordinary income and capital gain net income for preceding years that were not distributed during such years and on which we previously paid no U.S. federal income tax.

 

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We currently intend to distribute net capital gains (i.e., net long-term capital gains in excess of net short-term capital losses), if any, at least annually out of the assets legally available for such distributions. However, we may decide in the future to retain such capital gains for investment, incur a corporate-level tax on such capital gains, and elect to treat such capital gains as deemed distributions to you. If this happens, you will be treated for U.S. federal income tax purposes as if you had received an actual distribution of the capital gains that we retain and reinvested the net after tax proceeds in us. In this situation, you would be eligible to claim a tax credit equal to your allocable share of the tax we paid on the capital gains deemed distributed to you. We cannot assure you that we will achieve results that will permit us to pay any cash distributions, and if we issue senior securities, we will be prohibited from making distributions if doing so would cause us to fail to maintain the asset coverage ratios stipulated by the 1940 Act or if such distributions are limited by the terms of any of our borrowings.

 

Asset Coverage

In accordance with the 1940 Act, the Company has historically only been allowed to borrow amounts such that its “asset coverage,” as defined in the 1940 Act, is at least 200% after such borrowing, permitting the Company to borrow up to one dollar for investment purposes for every one dollar of investor equity. “Asset coverage” generally refers to a company’s total assets, less all liabilities and indebtedness not represented by “senior securities,” as defined in the 1940 Act, divided by total senior securities representing indebtedness and, if applicable, preferred stock. “Senior securities” for this purpose includes borrowings from banks or other lenders, debt securities and preferred stock.

On March 23, 2018, the SBCAA was signed into law. The SBCAA, among other things, modifies the applicable provisions of the 1940 Act to reduce the required asset coverage ratio applicable to BDCs from 200% to 150% subject to certain approval, time and disclosure requirements (including either stockholder approval or approval of a majority of the directors who are not interested persons of the BDC and who have no financial interest in the proposal). On October 5, 2020, the Board and the Members of MSC Capital LLC voted to approve the adoption of the reduced asset coverage ratio.

As of March 31, 2024 and December 31, 2023, the Company had total senior securities of $83,136 thousand and $86,316, respectively, consisting of borrowings under the Credit Facility, and had asset coverage ratios of 173.5% and 171.7%, respectively. For a discussion of certain risks associated with the reduction of the required minimum asset coverage ratio applicable to the Company, see “Risk Factors — Risks Related to Our Business and Structure — The SBCAA allows us to incur additional leverage, which may increase the risk of investing with us.”

Critical Accounting Policies

The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses for the periods covered by such consolidated financial statements. The Company is an investment company following accounting and reporting guidance in Accounting Standards Codification (“ASC”) 946, Financial Services-Investment Companies Changes in the economic environment, financial markets and any other parameters used in determining such estimates could cause actual results to differ. The Company will reevaluate its estimates on an ongoing basis. In addition to the discussion below, we will describe our critical accounting policies in the notes to our future consolidated financial statements. 

 


Valuation Procedures

 

Under procedures established by our Board and in accordance with the 1940 Act, we will valueour Investment Advisor values investments for which market quotations are readily available at such market quotations. Assets listed on an exchange will be valued at their last sales prices as reported to the consolidated quotation service at 4:00 P.M. eastern time on the date of determination. If no such sales of such securities occurred, such securities will be valued at the mean between the last available bid and ask prices as reported by an independent, third partythird-party pricing service on the date of determination. Debt and equity securities that are not publicly traded or whose market prices are not readily available will be valued at fair value, subject at all times to the oversight and approval of our Board. Such determination of fair values may involve subjective judgments and estimates, although we will also engage independent valuation providers to review the valuation of each portfolio investment that constitutes a material portion of our portfolio and that does not have a readily available market quotation at least once annually. With respect to unquoted securities, our Investment Advisor, together with our independent valuation advisors, and subject at all times to the oversight and approval of our Board, will value each investment considering, among other measures, discounted cash flow models, comparisons of financial ratios of peer companies that are public and other factors. We intend to retainhave retained one or more independent providers of financial advisory services to assist the Investment Advisor and the Board by performing certain limited third-party valuation services. We may appoint additional or different third-party valuation firms in the future.

 

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When an external event such as a purchase transaction, public offering or subsequent equity sale occurs with respect to a fair-valued portfolio company or comparable company, our Board will use the pricing indicated by the external event to corroborate and/or assist us in our valuation. Because we expect that there will not be a readily available market for many of the investments in our portfolio, we expect to value many of our portfolio investments at fair value as determined in good faith by our Investment Advisor under the supervision of our Board using a documented valuation policy and a consistently applied valuation process. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of our investments may differ significantly from the values that would have been used had readily available market quotations existed for such investments, and the differences could be material.

 

ASC Topic 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. ASC Topic 820 also provides guidance regarding a fair value hierarchy, which prioritizes information used to measure fair value and the effect of fair value measurements on earnings and provides for enhanced disclosures determined by the level of information used in the valuation. In accordance with ASC Topic 820, these inputs are summarized in the three levels listed below.

 

Level 1—1 – Valuations are based on quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date.

 

Level 2—2 – Valuations are based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly and model-based valuation techniques for which all significant inputs are observable.

 

Level 3—3 – Valuations are based on inputs that are unobservable and significant to the overall fair value measurement. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models incorporating significant unobservable inputs, such as discounted cash flow models and other similar valuations techniques. The valuation of Level 3 assets and liabilities generally requires significant management judgment due to the inability to observe inputs to valuation.

 

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of observable input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and it considers factors specific to the investment.

 


With respect to investments for which market quotations are not readily available, our Investment Advisor will undertake a multi-step valuation process each quarter, as described below:

 

●Investments for which no such market prices are available or reliable will be preliminarily valued at such value as the Investment Advisor may reasonably determine, which may include third partythird-party valuations;

   

●The audit committee of our Board (the “Audit Committee”) will then review these preliminary valuations;

●At least once annually, the valuation for each portfolio investment that constitutes a material portion of our portfolio and that does not have a readily available market quotation will be reviewed by an independent valuation firm; and

 

●Our BoardInvestment Advisor will then discuss valuations and determine the fair value of each investment in our portfolio in good faith, based on the input of our Advisor, the respective independent valuation firms and the Audit Committee.firms.

 

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Investment Transactions, Realized/Unrealized Gains or Losses, and Income Recognition

Investment transactions are recorded on a trade date basis (for publicly-traded investments and securities traded through dealer markets) or upon closing of the transaction (for private investments). The cost of an investment includes all costs incurred by the Company as part of the purchase of such investment. The difference between the initially recognized cost and the subsequent fair value measurement of an investment is reflected as “net change in unrealized appreciation on non-controlled/non-affiliated company investments” on the Consolidated Statements of Operations.

Realized gain or loss from an investment is recorded at the time of disposition and calculated using the weighted average cost method. Unrealized gain or loss reflects the changes in fair value of investments as determined in compliance with the Investment Advisor’s valuation policy.

Interest income, adjusted for amortization of market premium and accretion of market discount, is recorded on an accrual basis to the extent that we expect to collect such amounts. Interest income on debt instruments is accrued and recognized for those issuers who are currently paying in full or expected to pay in full. For those issuers who are in default or expected to default, interest is not accrued and is only recognized when received. Interest income and expense include discounts accreted and premiums amortized on certain debt instruments as determined in good faith by the Adviser and calculated using the effective interest method. Loan origination fees, original issue discounts and market discounts or premiums are capitalized as part of the underlying cost of the investments and accreted or amortized over the life of the investment as interest income.

Management and Incentive Fees

The base management fee and the income-based incentive fees are expensed each quarter and payable in arrears. Additionally, we accrue a capital gains-based incentive fee quarterly that is paid annually in arrears. The accrual for the capital incentive fee includes the recognition of incentive fee on unrealized capital gains, even though such incentive fee is neither earned nor payable to the Adviser until the gains are both realized and in excess of unrealized depreciation on investments. The amount of capital gains incentive fee expense related to the hypothetical liquidation of the portfolio (and assuming no other changes in realized or unrealized gains and losses) would only become payable to the Adviser in the event of a complete liquidation of the Company’s portfolio as of period end and the termination of the Advisory Agreement on such date. Also, it should be noted that while we accrue the capital incentive fee quarterly, the expense will fluctuate with the Company’s overall investment results and the expense will be finalized at year end.

Expenses

For the three months ended March 31, 2024 and 2023, the Company incurred expenses of approximately $2,346 thousand and $2,054 thousand, respectively. The expenses are primarily related to management fees, incentive fees, interest and debt financing expenses, organization expenses, professional fees, directors’ fees, offering costs and administration and custodian fees. Expenses are recognized on an accrual basis.

Federal Income Taxes

We have elected to be treated, and to qualify annually, as a RIC under Subchapter M of the Code. Generally, a RIC is not subject to federal income taxes on distributed income and gains if it distributes at least 90% of its net ordinary income and net short-term capital gains in excess of its net long-term capital losses, if any, to its stockholders. We intend to distribute sufficient dividends to maintain our RIC status each year and we do not anticipate paying any material federal income taxes in the future.

Investment Income

 

For debt investments, we record interest income on the accrual basis to the extent that such amounts are expected to be collected. OID and purchased discounts and premiums are accreted/amortized into interest income using the effective interest method, where applicable. Loan origination fees are deferred and accreted into interest income using the effective interest method. We record prepayment premiums on loans and other investments as interest income when such amounts are received. We stop accruing interest on investments when it is determined that interest is no longer collectible. As of September 30, 2020,March 31, 2024 and 2023 we had notwo loans and one loan on non-accrual status.status, respectively.

 

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Net Realized Gains or Losses and Net Change in Unrealized Appreciation or Depreciation

 

We measure realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, without regard to unrealized appreciation or depreciation previously recognized, but considering unamortized upfront fees and prepayment penalties. Net change in unrealized appreciation or depreciation reflects the change in portfolio investment values during the reporting period, including any reversal of previously recorded unrealized appreciation or depreciation, when gains or losses are realized.

 

Realized gains and losses from securities transactions and unrealized appreciation and depreciation of securities are determined using the identified cost basis method for financial reporting.

 

Contractual Obligations

 

Commitments to extend credit include loan proceeds we are obligated to advance, such as delayed draws. Commitments generally have fixed expiration dates or other termination clauses. As of September 30, 2020, we did not have any obligations forMarch 31, 2024 and December 31, 2023, the repayment of debt outstanding. On October 13, 2020, we entered into the Credit Facility. See “Recent Developments” below.Company had no unfunded commitments. 

 

Off-Balance Sheet Arrangements

 

Other than contractual commitments and other legal contingencies incurred in the normal course of our business, we do not expect to have any off-balance sheet financings or liabilities. These instruments include commitments to extend credit and fund equity capital and involve, to varying degrees, elements of liquidity and credit risk in excess of the amount recognized in the balance sheet. At September 30, 2020,As of March 31, 2024 and December 31, 2023, we had a total of $265,031 inno outstanding commitments comprised of an investments with commitments to fund revolving loans that had not been fully drawn or term loans with additional commitments not yet funded.

 


Related Party Transactions

 

All three MembersAs of March 31, 2024, affiliates owned approximately 38% of the Company are related partiesrepresenting approximately $22,989 thousand of the Manager. During the period July 1, 2020 (commencementCompany’s net assets. As of operations) through September 30,2020, the Members contributed $20,499,718December 31, 2023, affiliates owned approximately 38% of cash and $2,858,282 of assets to the Company in exchange for equity inrepresenting approximately $23,340 thousand of the Company. Assets contributed to the Company were contributed at fair value in accordance with Financial Accounting Standards No.116, Accounting for Contributions Received and Contributions Made.Company’s net assets.

 

Separate from the contributions made above, theThe Company may, from time to time, purchase investments from, or sell investments to affiliates of our ManagerInvestment Advisor at fair value on the trade date. DuringFor the periodthree months ended July 1, 2020 (commencement of operations), to September 30, 2020,March 31, 2024 and 2023, there were no purchases of investments from or sales of investments to affiliates of our Manager.Investment Advisor.

 

Prior toFor the Company’s conversion to a corporationthree months ended March 31, 2024 and election to be treated as a BDC,2023, the Company incurred $20 thousand in directors’ fees expense.

The Company carries employment practices liability, directors and officers and errors and omission insurance. For the best interests of the Company, these policies are joint liability policies with Moelis Asset and its affiliates.

Organizational and Offering Expenses

For the three months ended March 31, 2024 and 2023 the Company did not payincur organizational or offering expenses. Organizational costs are expensed as incurred and offering cost are amortized over a twelve-month period.

Investment Advisory Agreement

We have initially entered into the ManagerInvestment Advisory Agreement with the Investment Advisor, an affiliate of Moelis Asset, which was approved by our Board and our sole stockholder for an initial two-year term, under which the Investment Advisor, subject to the overall supervision of our Board manages the day-to-day operations of and provides investment advisory services to us. Subsequent to that two-year term, the Board has approved the Investment Advisory Agreement of Investment Advisor for renewal annually.

55

On August 11, 2023, the Board approved the renewal of the Investment Advisory Agreement.

Our Investment Advisor has agreed to waive its fees (base management and incentive fee), without recourse against or reimbursement by us, for any quarter where net investment income plus net realized capital gains is not sufficient to maintain a targeted annual distribution payment on shares of common stock outstanding on the relevant payment dates of 6.0% based on our net asset value per share.

The base management fee is calculated at a maximum annual rate of 1.0% of the average of the weighted average (based on the number of shares outstanding each day in the quarter) of our gross assets (including uninvested cash and cash equivalents) at the end of each of the two most recently completed calendar quarters. On August 13, 2021, the Board agreed to make investments rather than gross assets the basis for their fee to be more in line with the waivers implemented for management fees. Net management fees for the three months ended March 31, 2024 and 2023 were $349 thousand and $320 thousand, respectively. The Company elected to waive a portion of the management fee and charged management fees on investments rather than gross assets. The Investment Advisor has agreed to a 6.0% priority dividend to shareholders before receiving a fee for the services it providedprovides to the Company. Similarly,

Administration Agreement

We have initially entered into the affiliated directorsAdministration Agreement with the Administrator, an affiliate of Moelis Asset, which was approved by our Board and officersour sole stockholder for an initial two-year term, under which the Administrator, subject to the overall supervision of our Board manages the day-to-day operations of, and provides office space, office services and equipment and other administration services to us. Subsequent to that two-year term, the Board has approved the Administration Agreement of Administrator for renewal annually.

On August 11, 2023, the Board approved the renewal of the Administration Agreement which automatically renews for successive one-year periods each September 17th; provided that such continuance is specifically approved at least annually by the vote of the Board or by the vote of a majority of the outstanding voting securities of the Company did not receive compensation fromand the Company.

Recent Developments

On October 7, 2020, the Company converted tovote of a Maryland corporation, named Steele Creek Capital Corporation. On that date, the Company elected to be regulated as a BDC under the 1940 Act. The Company will elect for federal income tax purposes to be treated as a regulated investment company (“RIC”) under the Internal Revenue Code of 1986, as amended (the “Code”). The Company will be externally managed by Steele Creek Investment Management LLC (the “Advisor”). The Company entered into an investment advisory agreement (the “Advisory Agreement”) with the Advisor and will compensate the Advisor for its services with a fee that consists of two components: a management fee and an incentive fee. In connection with the conversion, the sharesmajority of the Company converted into an aggregate amount of 2,282,787.33 sharesmembers of the Company’s common stock.Board who are not parties to this Agreement or “interested persons” (as such term defined in Section 2(a)(19) of the Investment Company Act) of any such party, in accordance with the Investment Company Act.

 

Recent Developments

Management has evaluated subsequent events through the date of issuance of these consolidated financial statements and has determined that there are no subsequent events outside the ordinary scope of business that require adjustment to, or disclosure in, the consolidated financial statements other than those disclosed below.

On October 13, 2020, the Company entered into a Credit Agreement with BNP Paribas (“BNP”) as lender and administrative agent (the “Credit Facility”) providing a maximum of $45,000,000 to the borrower. During the Credit Facility’s revolving period, it bears interest at London Interbank Offered Rate, or LIBOR, plus 200 basis points. The Company created a wholly owned subsidiary, Steele Creek Capital Funding I, LLC, which it will use to hold the Company’s investments, and a first priority continuing security interest in, to and under each investment, all underlying investments and underlying assets has been granted to the BNP to be used as collateral for the Credit Facility. The Company began transferring investments into Steele Creek Funding I, LLC in October.

On DecemberApril 1, 2020,2024, the Company issued and sold 350,443.435,910 shares of its common stock to certain investors for an aggregate offering price of $3,750,000.$57 thousand. The sale of its common stock was made pursuant to subscription agreements between the Company and the investor. Theinvestors, and the issuance of the common stock was exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof and Regulation D thereunder.

 

On April 17, 2024, the Company paid approximately $571 thousand for the approximately 59,713 shares tendered and accepted at the close of the March 2024 tender offer.

On May 1, 2024, the Company issued and sold 18,127 shares of its common stock to certain investors for an aggregate offering price of $175 thousand. The sale of its common stock was made pursuant to subscription agreements between the Company and the investors, and the issuance of the common stock was exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof and Regulation D thereunder. 

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Item 3. Quantitative and Qualitative Disclosures Aboutabout Market Risk.Risks

Not applicable.

 


We are subject to financial market risks, including changes in interest rates. Interest rate sensitivity refers to the change in our earnings that may result from changes in the level of interest rates. Because we expect to fund a portion of our investments with borrowings, our net investment income is expected to be affected by the difference between the rate at which we invest and the rate at which we borrow. As a result, there can be no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income.

As of March 31, 2024, 100.0% of our loan portfolio bore interest at floating rates with 63.4% (at fair value) having an interest rate floor between 0.50% and 1.00%. The floating rate loans are usually based on a SOFR (or an alternative risk-free floating interest rate index) rate and typically have durations ranging from one to six months, after which they reset to current market interest rates. Floating rate investments subject to a floor generally reset to the current market index after one to nine months if the index exceeds the floor. For positions with an interest rate floor, we do not benefit from increases in interest rates until such rates exceed the floor and thereafter benefit from market rates above any such floor. Recent interest rate increases announced in the United States have driven the SOFR rates above the floors in effect as of quarter end. Base rates on 100% of the portfolio exceeds the stated floors. 

Assuming that the consolidated statement of assets and liabilities as of March 31, 2024 was to remain constant and that we took no actions to alter our existing interest rate sensitivity, the following table shows the annualized impact of hypothetical base rate changes in interest rates:

  As of March 31, 2024 
Basis Point Changes Interest
Income		  Interest
Expense		  Net
Income		 
Up 300 basis points $4,395  $(2,504) $1,891 
Up 200 basis points  2,930   (1,669)  1,261 
Up 100 basis points  1,465   (835)  630 
Down 100 basis points  (1,451)  835   (616)
Down 200 basis points  (2,902)  1,669   (1,233)
Down 300 basis points  (4,353)  2,504   (1,849)

Although management believes that this measure is indicative of our sensitivity to interest rates, it does not reflect any potential impact to the fair value of our investments as a result of changes to interest rates, nor does it adjust for potential changes in the credit market, credit quality, size and composition of the assets in our consolidated statement of assets and liabilities and other business developments that could affect the net increase/(decrease) in net assets resulting from operations or net investment income. Accordingly, no assurances can be given that actual results would not differ materially from those shown above.

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Item 4. Controls and Procedures.Procedures

 

Evaluation of Disclosure Controls and Procedures

 

As of September 30, 2020,March 31, 2024, we, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on that evaluation, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective and provided reasonable assurance that information required to be disclosed in our periodic SEC filings is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. However, in evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of such possible controls and procedures.

 

Management Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Exchange Act.

In connection with the preparation of this quarterly report, our management, including our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting as of March 31, 2024. In making that assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013 framework). Based on its assessment, our management concluded that, as of March 31, 2024, our internal control over financial reporting was effective.

Changes in Internal Control over Financial Reporting

 

There have been no changes in our “internal control over financial reporting” (as defined in Rule 13a 15(f) of the Exchange Act) that occurred during our quarterthe period ended September 30, 2020March 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

We are not currently subject to any material legal proceedings, nor, to our knowledge, is any material legal proceeding threatened against us. From time to time, we may be a party to certain legal proceedings in the ordinary course of business, including proceedings relating to the enforcement of our rights under loans to or other contracts with our portfolio companies.

 

Item 1A. Risk Factors.

 

Investing in our common stock involves a number of significant risks. In addition to the other information set forth in this report, you should carefully consider the risk factors discussed in ItemPart I, “Item 1A. Risk Factors of Amendment No. 2 toFactors” in our Registration StatementAnnual Report on Form 1010-K for the fiscal year ended December 31, 2023 (the “Annual Report on Form 10-K”), which was filed with the SEC on November 24, 2020.could materially affect our business, financial condition and/or operating results. The risks described in our registration statementAnnual Report on Form 1010-K are not the only risks we face. Additional risks and uncertainties that are not presentlycurrently known to us or not presently deemed material by usthat we currently deem to be immaterial also may also materially and adversely affect our business, financial condition and/or operating results. ThereOther than the risk factors below, during the three months ended March 31, 2024, there have been no material changes during the period from July 1, 2020 (Commencement of Operations) to September 30, 2020 to the risk factors discussedset forth in Item 1A. Risk Factors of Amendment No. 2 to our Registration StatementAnnual Report on Form 10.10-K.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

 

In conjunction with our formation, certain affiliates of our Advisor contributed assets to us in exchange for limited liability company membership interests of the Company. As of September 30, 2020, the value of the initial portfolio was approximately $24.0 million. The membership interests were sold in reliance upon the available exemptions from registration requirements of Section 4(a)(2) of the Securities Act of 1933, as amended. None.

 

Item 3. Default Upon Senior Securities.

 

None.

 

Item 4. Mine Safety Disclosures.

 

Not applicable.

 

Item 5. Other Information.

None.

 


During the fiscal quarter ended March 31, 2024, none of our directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any non-Rule 10b5-1 trading arrangement. 

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Item 6. Exhibits, Consolidated Financial Statement SchedulesSchedules.

 

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

Exhibit Index

3.1Exhibit Index 
3.1Form of Articles of Incorporation (Incorporated by reference to Exhibit 3.1 to Registrant’s Amendment No. 1 to Registration Statement on Form 10 (File No. 000-56189) filed on November 9, 2020).
   
3.2 Bylaws (Incorporated by reference to Exhibit 3.2 to Registrant’s Amendment No. 1 to Registration Statement on Form 10 (File No. 000-56189) filed on November 9, 2020).
10.1Form of Investment Advisory Agreement (Incorporated by reference to Exhibit 10.1 to Registrant’s Amendment No. 1 to Registration Statement on Form 10 (File No. 000-56189) filed on November 9, 2020).
10.2Form of Waiver Letter Agreement to the Investment Advisory Agreement (Incorporated by reference to Exhibit 10.2 to Registrant’s Amendment No. 1 to Registration Statement on Form 10 (File No. 000-56189) filed on November 9, 2020).
10.3Form of Administration Agreement (Incorporated by reference to Exhibit 10.3 to Registrant’s Amendment No. 1 to Registration Statement on Form 10 (File No. 000-56189) filed on November 9, 2020).
10.4Form of Custody Agreement (Incorporated by reference to Exhibit 10.4 to Registrant’s Amendment No. 1 to Registration Statement on Form 10 (File No. 000-56189) filed on November 9, 2020).
10.5Form of Indemnification Agreement for Directors and Officers (Incorporated by reference to Exhibit 10.5 to Registrant’s Amendment No. 1 to Registration Statement on Form 10 (File No. 000-56189) filed on November 9, 2020).
10.6Form of Trademark Licensing Agreement (Incorporated by reference to Exhibit 10.6 to Registrant’s Amendment No. 1 to Registration Statement on Form 10 (File No. 000-56189) filed on November 9, 2020).
10.7Form of Subscription Agreement (Incorporated by reference to Exhibit 10.7 to Registrant’s Amendment No. 2 to Registration Statement on Form 10 (File No. 000-56189) filed on November 24, 2020).
10.8*Form of Dealer Manager Agreement
   
10.9*31.1* Credit Agreement with BNP Paribas
31.1*Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
   
31.2* Certification of Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
   
32.1* Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
   
32.2* Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*Inline XBRL Instance Document
101.SCH*Inline XBRL Taxonomy Extension Schema Document
101.CAL*Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit 101)

 

**Filed herewith

 



SIGNATURES

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 Steele Creek Capital Corporation
  
Date: December 23, 2020May 10, 2024/s/ Glenn Duffy
 Name: Glenn Duffy
 Title:Chief Executive Officer,
Chief Investment Officer, and President

(Principal Executive Officer)
  
Date: December 23, 2020May 10, 2024/s/ Douglas Applegate Jr.
 Name:  Douglas Applegate Jr.
 Title:Chief Financial Officer

(Principal Financial and Accounting Officer)

 

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