 | November 17, 2017 | Eversheds Sutherland (US) LLP 700 Sixth Street, NW, Suite 700
D: +1 202.383.0176
harrypangas@ eversheds-sutherland.com |
| VIA EDGAR | |
| Dominic Minore, Esq. | |
| Megan Miller | |
| United States Securities and Exchange Commission | |
| 100 F Street, N.E. | |
| Washington, DC 20549 |
| Re: | TICC Capital Corp. | |
| Post-Effective Amendment No. 3 to the Registration Statement on | ||
| Form N-2, Filed November 14, 2017 | ||
| File No. 333-202672 |
Dear Mr. Minore and Ms. Miller:
On behalf of TICC Capital Corp. (the “Company”), set forth below are the Company’s responses to the oral comments provided by the staff of the Division of Investment Management (the “Staff”) of the Securities and Exchange Commission (the “Commission”) to the Company on November 15, 2017 and November 16, 2017, in each case, with respect to post-effective amendment no. 3 to the Company’s registration statement on Form N-2 (File No. 333-202672) filed with the Commission on November 14, 2017 (the “Registration Statement”) and the prospectus included therein (the“Prospectus”). The Staff’s comments are set forth below in italics followed by the Company’s responses.
1. The Staff refers to the disclosure in the notes to the financial statements and in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section for the period ended September 30, 2017, which indicates that debt extinguishment costs are recorded within Realized Loss on Extinguishment of Debt in the Consolidated Statement of Operations. However, the disclosure in the notes to the financial statements for the period ended December 31, 2016 indicates that “upon early termination of debt…the remaining balance of unaccreted fees related to such debt accelerated into interest expense.” Please explain this discrepancy and whether there was a change in accounting policy or a restatement of financial statements during the period ended September 30, 2017.
Response: The Company advises the Staff on a supplemental basis that for the period ended September 30, 2017, the Company determined to reclassify the accelerated note discount expense and accelerated deferred debt issuance costs from Interest Expense to |
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2. On Page 70 of the Prospectus, the disclosure indicates that the Company’s asset coverage for borrowed amounts was 339.21% as of September 30, 2017. However, on page F-35 of the Prospectus the disclosure indicates that the Company’s asset coverage for borrowed amounts was 504.2% as of September 30, 2017. Please advise the Staff the reason for this difference.
Response: The Company acknowledges the Staff’s comment and confirms that it will revise the disclosure on page F-35 of the Prospectus in order to conform the two figures in the final Prospectus that the Company will file with the Commission after the Registration Statement is declared effective. The Company has also attached the marked page F-35 of the Prospectus hereto.
3. The Staff refers to the disclosure on page 4 of the Prospectus regarding a “reset” of a CLO vehicle. Please add disclosure to explain how the Company avails itself of resetting opportunities and why a reset of a CLO investment is beneficial for the Company.
Response: The Company will add disclosure in response to the Staff’s comment in the final Prospectus that the Company will file with the Commission after the Registration Statement is declared effective. The Company has also attached the marked pages 4 and 82 of the Prospectus hereto.
4. The Staff refers to the disclosure regarding “return of capital” on page 41 of the Prospectus. Please add disclosure to explain what a “return of capital” is in plain English.
Response: The Company will add disclosure in response to the Staff’s comment in the final Prospectus that the Company will file with the Commission after the Registration Statement is declared effective. The Company has also attached the marked page 41 of the Prospectus hereto. |
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Response: The Company advises the Staff that weighted average yield and weighted average annualized yield are the same number. As a result, to avoid confusion, the Company will remove references to weighted average annualized yield in the final Prospectus that the Company will file with the Commission after the Registration Statement is declared effective. The Company has also attached the marked page 43 of the Prospectus hereto.
6. The Staff refers to the disclosure on page 49 of the Prospectus, which indicates that the Company’s qualifying assets represented 67.3% of the Company’s total assets as of September 30, 2017. Please explain the inputs that the Company used to derive at 67.3% for the Company’s qualifying assets as of September 30, 2017 and please confirm that the Company was in compliance with the requirements of Section 55 of the Investment Company Act of 1940, as amended (the“1940 Act”), at the time that it acquired any non-qualifying assets during the period ended September 30, 2017.
Response: To determine the percentage of the Company’s qualifying assets as of September 30, 2017, the Company divided the fair value of its non-qualifying assets as of September 30, 2017, which was $178,044,155 ($4,481,550 in CLO Debt and $173,562,605 in CLO Equity), by the Company’s adjusted total assets of $543,829,143 ($550,360,175 in total assets minus $1,516,032 in “Other Assets” and minus $5,015,000 in “Securities purchased not settled”). The Company has historically made such adjustments to the total assets amount because: (i) “Other assets” are escrow receivables, prepaid expenses and deferred equity offering costs, and are not the type of assets described in paragraphs (1) through (6) of Section 55(a) of the 1940 Act, and (ii) not deducting “Securities purchased not settled” from total assets would result in double counting such securities because such securities are included as investments and in the cash amount as of the quarter end. The Company also confirms to the Staff that it was in compliance with the requirements of Section 55 of the 1940 Act at the time that it acquired any non-qualifying assets during the period ended September 30, 2017.
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Please do not hesitate to call me at (202) 383-0805, or Vlad M. Bulkin at (202) 383-0815, if you have any questions or require any additional information. |
| Sincerely, | |
| /s/ Harry S. Pangas | |
| Harry S. Pangas |
| cc: | Jonathan H. Cohen, Chief Executive Officer, TICC Capital Corp. | |
| Steven B. Boehm, Esq., Eversheds Sutherland (US) LLP |
| Vlad M. Bulkin, Esq., Eversheds Sutherland (US) LLP |