UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT
OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act File Number 811-23333
Cliffwater Corporate Lending Fund
(Exact name of registrant as specified in charter)
c/o UMB Fund Services, Inc.
235 West Galena Street
Milwaukee, WI 53212
Registrant’s telephone number, including area code: (414) 299-2000
Terrance P. Gallagher
235 West Galena Street
Milwaukee, WI 53212
(Name and address of agent for service)
Date of fiscal year end: December 31
Date of reporting period: December 31, 2021
Item 1. Report to Shareholders
CLIFFWATER CORPORATE LENDING FUND
Annual Report
For the Year Ended December 31, 2021
Cliffwater Corporate Lending Fund
Table of Contents
For the Year Ended December 31, 2021
Letter to Shareholders (Unaudited) | 2-3 |
Fund Performance | 4-5 |
Report of Independent Registered Public Accounting Firm | 6 |
Consolidated Schedule of Investments | 7-42 |
Consolidated Statement of Assets and Liabilities | 43 |
Consolidated Statement of Operations | 44 |
Consolidated Statements of Changes in Net Assets | 45 |
Consolidated Statement of Cash Flows | 46-47 |
Consolidated Financial Highlights | 48-49 |
Notes to Consolidated Financial Statements | 50-87 |
Other Information (Unaudited) | 88-89 |
Fund Management (Unaudited) | 90-92 |
This report is submitted for the general information of the shareholders of the Fund. It is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus, which includes information regarding the Fund’s risks, objectives, fees and expenses, experience of its management and other information.
www.cliffwaterfunds.com
1
Cliffwater Corporate Lending Fund
Letter to Shareholders
December 31, 2021 (Unaudited)
To our shareholders:
We recently completed two and one-half years of operation and want to thank you for the continued trust you have placed in us.
Performance has been consistently strong relative to our objective. The Cliffwater Corporate Lending Fund (the fund) produced a net 8.61% annualized return from its June 5, 2019 inception, through December 31, 2021. This compares to a 4.38% annualized return for the S&P/LSTA Leveraged Loan Index. The fund also reported relatively consistent monthly returns. Its annualized standard deviation measures 2.32% for the same period compared to 9.31% for the S&P/LSTA Leveraged Loan Index.
The fund experienced strong investor inflows over trailing year, with net-asset-value growing from $0.7 billion on December 31, 2020 to $4.7 billion on December 31, 2021. This asset growth has been supported by significant investment in personnel and technology to grow our platform and the onboarding of additional strategic lending partners to access high quality senior corporate loans. Factors materially affecting the fund’s performance during the most recently completed fiscal year include a high current cash yield, the absence of realized losses, and unrealized gains recouping unrealized losses that occurred during the prior fiscal year.
We remain confident in the fund’s continued performance despite the uncertain economic environments brought by Covid-19 and unexpected inflation. The fund’s 7.3% net current yield remains attractive and the floating-rate nature of our loans should react favorably in a rising interest rate economy.
We again sincerely thank you for your support.
Regards,
Stephen L. Nesbitt
Chief Investment Officer
Cliffwater LLC
The performance data shown represents past performance which does not guarantee future results. It is net of all fees. Current performance may be lower or higher than the performance quoted. All performance shown assumes reinvestment of dividends.
2
Cliffwater Corporate Lending Fund
Letter to Shareholders
December 31, 2021 (Unaudited) (Continued)
Important Disclosures
The Fund’s investment program is speculative and entails substantial risks. There can be no assurance that the Fund’s investment objectives will be achieved or that its investment program will be successful. Investors should consider the Fund as a supplement to an overall investment program and should invest only if they are willing to undertake the risks involved. Investors could lose some or all of their investment.
Shares are an illiquid investment.
We do not intend to list the Fund’s shares (“Shares”) on any securities exchange and we do not expect a secondary market in the Shares to develop.
You should generally not expect to be able to sell your Shares (other than through the limited repurchase process), regardless of how we perform.
Although we are required to implement a Share repurchase program, only a limited number of Shares will be eligible for repurchase by us.
You should consider that you may not have access to the money you invest for an indefinite period of time.
An investment in the Shares is not suitable for you if you have foreseeable need to access the money you invest.
Because you will be unable to sell your Shares or have them repurchased immediately, you will find it difficult to reduce your exposure on a timely basis during a market downturn.
The Fund is a non-diversified management investment company and may be more susceptible to any single economic or regulatory occurrence than a diversified investment company. Cybersecurity risks have significantly increased in recent years and the Fund could suffer such losses in the future. One of the fundamental risks associated with the Fund’s investments is the risk that an issuer will be unable to make principal and interest payments on its outstanding debt obligations when due. Other risk factors include interest rate risk (a rise in interest rates causes a decline in the value of debt securities) and prepayment risk (the debtor may pay its obligation early, reducing the amount of interest payments).
3
Cliffwater Corporate Lending Fund
Fund Performance
December 31, 2021 (Unaudited)
Performance of a $10,000,000 Investment
This graph compares a hypothetical $10,000,000 investment in the Fund’s Class I Shares with a similar investment in the S&P LSTA Leverage Loans Index and Bloomberg US Aggregate Index. These indices do not serve as benchmarks for the Fund and are shown for illustrative purposes only. The Fund does not have a designated performance benchmark. Results include the reinvestment of all dividends and capital gains. These indices do not reflect expenses, fees, or sales charges, which would lower performance.
The S&P LSTA Leverage Loans Index is designed to measure the performance of the global senior loan market. The fixed-weight index is 75% weighted in the S&P/LSTA Leveraged Loan Index and 25% weighted in the S&P European Leveraged Loan Index. The index is unmanaged and it is not available for investment.
The Bloomberg US Aggregate Index is a broad based, market capitalization-weighted bond market index representing intermediate term investment grade bonds traded in the United States. The index is unmanaged and it is not available for investment.
Average Annual Total Returns as of December 31, 2021 | 1 Year | Since |
Cliffwater Corporate Lending Fund (Inception Date June 5, 2019) | 10.38% | 8.61% |
S&P LSTA Leverage Loans Index | 5.20% | 4.38% |
Bloomberg US Aggregate Index | -1.54% | 3.66% |
The performance data quoted here represents past performance and past performance is not a guarantee of future results. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information quoted. The most recent quarter end performance may be obtained by calling 1 (888) 442-4420.
4
Cliffwater Corporate Lending Fund
Management’s Discussion of Fund Performance
December 31, 2021 (Unaudited) (Continued)
The Fund has entered into an expense limitation agreement that limits the Fund’s annualized ordinary fund-wide operating expenses to 2.25% through March 6, 2023 (the “Waiver”). Ordinary fund-wide operating expenses exclude any taxes, fees and interest payments on borrowed funds, distribution and servicing fees, brokerage and distribution costs and expenses, acquired fund fees and expenses, expenses incurred in connection with any merger or reorganization, and extraordinary or non-routine expenses, such as litigation expenses. Ordinary fund-wide operating expenses include, for the avoidance of doubt, the Investment Management Fee and the Fund’s start-up, offering and organizational expenses. The performance quoted above reflects the Waiver in effect and would have been lower in its absence.
For the Fund’s current expense ratios, please refer to the Financial Highlights Section of this report.
Returns reflect the reinvestment of distributions made by the Fund, if any. The graph and the performance table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
5
Cliffwater Corporate Lending Fund
Report of Independent Registered Public Accounting Firm
December 31, 2021
To the Shareholders and Board of Trustees of
Cliffwater Corporate Lending Fund
Opinion on the Financial Statements
We have audited the accompanying consolidated statement of assets and liabilities, including the consolidated schedules of investments and forward foreign currency exchange contracts, of Cliffwater Corporate Lending Fund (the “Fund”) as of December 31, 2021, the related consolidated statements of operations and cash flows for the year then ended, the consolidated statements of changes in net assets for each of the two years in the period then ended, the related notes, and the consolidated financial highlights for each of the three periods in the period then ended (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of December 31, 2021, the results of its operations and its cash flows for the year then ended, the changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the three periods in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2021, by correspondence with the custodian, brokers, agent banks, and underlying fund managers; when replies were not received, we performed other auditing procedures. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
We have served as the Fund’s auditor since 2019.
COHEN & COMPANY, LTD.
Milwaukee, Wisconsin
March 25, 2022
6
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021
Principal | Value | |||||||
SENIOR SECURED LOANS — 98.4% | ||||||||
COMMUNICATIONS — 4.9% | ||||||||
$ | 2,955,000 | 1236904 B.C. Ltd. First Lien Term Loan, 5.604% (1-Month USD Libor+550 basis points), 3/4/20271,2,3,4 | $ | 2,897,377 | ||||
Aspen Opco, LLC | ||||||||
2,272,727 | Revolver, 0.500%, 12/1/20272,4,5 | 2,250,000 | ||||||
22,159,091 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 12/1/20272,3,4 | 21,937,500 | ||||||
568,182 | Revolver, 7.750% (3-Month USD Libor+450 basis points), 12/1/20272,3,4,5 | 562,500 | ||||||
CM Acquisitions Holdings Inc. | ||||||||
301,176 | Delayed Draw, 7.000% (3-Month EUR Libor+600 basis points), 5/6/20252,3,4 | 301,176 | ||||||
819,246 | Incremental Term Loan, 7.000% (3-Month EUR Libor+600 basis points), 5/6/20252,3,4 | 819,246 | ||||||
2,627,542 | First Lien Term Loan, 7.000% (3-Month EUR Libor+600 basis points), 5/6/20252,3,4 | 2,627,543 | ||||||
GBP | 1,772,638 | CSL DualCom Ltd First Lien Term Loan, 5.725% (6-Month GBP Libor+550 basis points), 9/25/20272,3,4 | 2,372,955 | |||||
10,000,000 | EP Purchaser, LLC Second Lien Term Loan, 7.000% (3-Month USD Libor+650 basis points), 11/4/20293,4 | 9,850,000 | ||||||
Fingerpaint Marketing, Inc. | ||||||||
1,680,108 | Revolver, 0.500%, 12/30/20262,4,5 | 1,663,306 | ||||||
10,296,637 | Delayed Draw, 1.000%, 12/30/20262,4,5 | 10,245,153 | ||||||
4,883,721 | Delayed Draw, 7.250% (3-Month USD Libor+575 basis points), 12/30/20262,3,4 | 4,859,302 | ||||||
8,139,535 | First Lien Term Loan, 7.250% (3-Month USD Libor+575 basis points), 12/30/20262,3,4 | 8,058,139 | ||||||
15,000,000 | HH Global Finance Limited First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 9/24/20282,3,4 | 14,887,500 | ||||||
HPS Telecommunications | ||||||||
9,850,000 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 5/30/20252,3,4,6 | 9,816,136 | ||||||
10,000,000 | First Lien Term Loan, 7.350% (3-Month USD Libor+635 basis points), 5/28/20262,3,4 | 9,813,690 | ||||||
Iconic Purchaser Corporation | ||||||||
1,538,462 | Revolver, 0.500%, 11/5/20274,5 | 1,507,692 | ||||||
2,051,282 | Delayed Draw, 1.000%, 11/5/20284,5 | 2,030,769 | ||||||
16,410,256 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 11/5/20283,4,16 | 16,082,051 | ||||||
14,925,000 | KeyImpact Holdings, Inc. First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 6/21/20262,3,4 | 14,775,750 | ||||||
2,000,000 | Lifesize Second Lien Term Loan, 9.000% (3-Month USD Libor+800 basis points), 3/2/20253,4 | 1,975,845 | ||||||
MBS Holdings, Inc. | ||||||||
1,271,186 | Revolver, 0.500%, 4/6/20272,4,5 | 1,245,763 | ||||||
13,694,491 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 4/6/20272,3,4 | 13,420,602 | ||||||
Mc Group Ventures Corporation | ||||||||
4,519,231 | Delayed Draw, 1.000%, 6/30/20274,5 | 4,428,846 | ||||||
15,346,154 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 6/30/20273,4,15 | 15,039,231 | ||||||
5,096,154 | Delayed Draw, 6.500% (3-Month USD Libor+550 basis points), 6/30/20273,4,5,15 | 4,994,231 |
See accompanying Notes to Consolidated Financial Statements.
7
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
COMMUNICATIONS (Continued) | ||||||||
$ | 12,500,000 | MSM ACQUISITIONS Delayed Draw, 1.000%, 12/9/20262,4,5 | $ | 12,500,000 | ||||
OneCare Media, LLC | ||||||||
1,333,333 | Revolver, 0.500%, 9/29/20264,5 | 1,313,333 | ||||||
8,666,667 | First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 9/29/20263,4 | 8,536,667 | ||||||
Trunk Acquisition, Inc. | ||||||||
642,857 | Revolver, 0.500%, 2/9/20272,4,5 | 636,429 | ||||||
6,857,143 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 2/9/20272,3,4 | 6,788,571 | ||||||
2,500,000 | Revolver, 0.500%, 2/19/20274,5 | 2,475,000 | ||||||
22,500,000 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 2/19/20273,4,16 | 22,275,000 | ||||||
232,987,303 | ||||||||
CONSUMER DISCRETIONARY — 10.3% | ||||||||
12,468,750 | ADS Buyer, Inc. First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 12/31/20262,3,4 | 12,344,062 | ||||||
25,000,000 | AG-Twin Brook Consumer Discretionary First Lien Term Loan, 6.750% (1-Month USD Libor+575 basis points), 12/14/20272,3,4 | 24,625,000 | ||||||
Apex Service Partners, LLC | ||||||||
1,200,000 | Revolver, 0.500%, 7/31/20254,5 | 1,199,400 | ||||||
9,423,638 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 7/31/20252,3,4 | 9,291,707 | ||||||
10,200,000 | Delayed Draw, 6.250% (3-Month USD Libor+525 basis points), 7/31/20253,4 | 10,194,900 | ||||||
800,000 | Revolver, 6.250% (3-Month USD Libor+525 basis points), 7/31/20253,4,5 | 799,600 | ||||||
1,000,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 7/31/20253,4 | 999,500 | ||||||
2,496,058 | Delayed Draw, 6.500% (3-Month USD Libor+550 basis points), 7/31/20252,3,4 | 2,461,113 | ||||||
6,800,000 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 7/31/20253,4 | 6,796,600 | ||||||
Archimede | ||||||||
EUR | 4,500,000 | First Lien Term Loan, 6.000% (3-Month EUR Libor+600 basis points), 10/17/20273,4 | 5,081,967 | |||||
EUR | 1,500,000 | Delayed Draw, 6.000% (3-Month EUR Libor+600 basis points), 10/27/20272,3,4 | 1,693,989 | |||||
EUR | 2,500,000 | First Lien Term Loan, 6.000% (3-Month EUR Libor+600 basis points), 10/27/20272,3,4 | 2,823,315 | |||||
Bendon | ||||||||
1,800,000 | Revolver, 0.750%, 12/11/20252,4,5 | 1,737,720 | ||||||
12,870,000 | First Lien Term Loan, 8.000% (3-Month USD Libor+650 basis points), 12/11/20252,3,4 | 12,424,698 | ||||||
2,984,344 | Chop’t Creative Salad Company LLC First Lien Term Loan, 8.750% (1-Month USD Libor+725 basis points), 1/22/20243,4 | 2,984,344 | ||||||
Classic Collision | ||||||||
1,382,979 | Revolver, 0.500%, 1/14/20264,5 | 1,355,319 | ||||||
7,803,192 | Delayed Draw, 1.000%, 6/23/20274,5 | 7,647,128 | ||||||
10,792,513 | Delayed Draw, 6.000% (3-Month USD Libor+500 basis points), 6/23/20273,4,5 | 10,576,663 | ||||||
5,000,000 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 1/14/20263 | 4,900,000 | ||||||
7,920,000 | Discovery Education, Inc. First Lien Term Loan, 5.750% (3-Month USD Libor+475 basis points), 10/30/20262,3,4 | 7,920,000 | ||||||
EAP Holdco, LLC | ||||||||
1,804,883 | Revolver, 0.500%, 11/17/20272,4,5 | 1,786,834 |
See accompanying Notes to Consolidated Financial Statements.
8
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
CONSUMER DISCRETIONARY (Continued) | ||||||||
$ | 1,903,188 | Delayed Draw, 1.000%, 11/17/20272,4,5 | $ | 1,893,673 | ||||
601,628 | Revolver, 6.500% (3-Month USD Libor+550 basis points), 11/17/20272,3,4,5 | 595,612 | ||||||
19,412,523 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 11/17/20272,3,4 | 19,218,397 | ||||||
Evergreen Acqco 1 LP | ||||||||
11,970,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 3/26/20281,2,3 | 11,955,038 | ||||||
3,473,981 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 3/26/20283 | 3,469,639 | ||||||
495,491 | Fleetwash, Inc. Delayed Draw, 5.750% (3-Month USD Libor+475 basis points), 10/1/20242,3,4 | 493,014 | ||||||
11,500,000 | Gateway Casinos & Entertainment Limited First Lien Term Loan, 8.750% (3-Month USD Libor+800 basis points), 10/22/20273,4 | 11,270,000 | ||||||
HPS Consumer Discretionary | ||||||||
4,674,927 | First Lien Term Loan, 7.500% (3-Month USD Libor+600 basis points), 10/3/20242,3,4,6 | 4,768,425 | ||||||
17,079 | First Lien Term Loan, 1.000%, 6/27/20252,4,5 | 16,712 | ||||||
5,035,450 | First Lien Term Loan, 9.000% (3-Month USD Libor+800 basis points), 6/27/20252,3,4,5,6 | 4,927,254 | ||||||
18,881,250 | First Lien Term Loan, 7.750% (3-Month USD Libor+675 basis points), 7/26/20262,3,4 | 18,398,928 | ||||||
14,923,897 | HS Parent, Inc. First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 4/10/20262,3,4 | 14,774,658 | ||||||
15,000,000 | HY Cite Enterprises LLC First Lien Term Loan, 9.000% (3-Month USD Libor+800 basis points), 11/1/20262,3,4 | 14,550,000 | ||||||
25,675,000 | Iconix Brand Group, Inc. First Lien Term Loan, 8.500% (3-Month USD Libor+750 basis points), 8/4/20253,4 | 25,161,500 | ||||||
20,000,000 | KBP Brands LLC Delayed Draw, 1.000%, 5/26/20274,5 | 19,900,000 | ||||||
974,811 | KC Culinarte Intermediate LLC First Lien Term Loan, 4.750% (3-Month USD Libor+375 basis points), 8/24/20251,2,3,4 | 962,626 | ||||||
Len the Plumber, LLC | ||||||||
837,265 | Delayed Draw, 1.000%, 2/17/20262,4,5 | 820,520 | ||||||
6,312,599 | Delayed Draw, 5.500% (3-Month USD Libor+450 basis points), 2/17/20262,3,4,5 | 6,186,347 | ||||||
7,805,962 | First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 2/17/20262,3,4 | 7,649,843 | ||||||
8,577,903 | MAG DS Corp. First Lien Term Loan, 6.500% (1-Month USD Libor+525 basis points), 4/1/20271,2,3,4 | 8,396,909 | ||||||
NL1 Acquire Corp. | ||||||||
CAD 1,160,727 | Revolver, 0.500%, 5/26/20262,4,5 | 902,248 | ||||||
CAD 169,273 | Revolver, 6.250% (3-Month CAD Libor+525 basis points), 5/26/20262,3,4,5 | 131,577 | ||||||
CAD 2,598,371 | Delayed Draw, 1.000%, 5/26/20282,4,5 | 2,019,746 | ||||||
1,223,676 | Delayed Draw, 1.000%, 5/26/20284,5 | 1,217,558 | ||||||
CAD 1,287,977 | Delayed Draw, 6.500% (3-Month CAD Libor+550 basis points), 5/26/20282,3,4,5 | 1,001,160 | ||||||
CAD 9,511,050 | First Lien Term Loan, 6.500% (3-Month CAD Libor+550 basis points), 5/26/20282,3,4 | 7,393,056 | ||||||
196,324 | Delayed Draw, 6.500% (3-Month CAD Libor+550 basis points), 5/26/20284,5 | 195,342 | ||||||
2,100,000 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 5/26/20283,4 | 2,079,000 | ||||||
1,705,480 | Oak Parent, Inc. First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 10/26/20231,2,3,4 | 1,662,843 |
See accompanying Notes to Consolidated Financial Statements.
9
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
CONSUMER DISCRETIONARY (Continued) | ||||||||
Obagi Cosmeceuticals LLC | ||||||||
$ | 2,500,000 | Revolver, 0.500%, 3/16/20264,5 | $ | 2,500,000 | ||||
1,500,000 | Revolver, 8.500% (3-Month USD Libor+750 basis points), 3/16/20263,4,5 | 1,500,000 | ||||||
10,917,500 | First Lien Term Loan, 8.500% (3-Month USD Libor+750 basis points), 3/16/20263,4 | 11,354,200 | ||||||
29,914,143 | Owl Rock Consumer Discretionary First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 3/26/20262,3,4 | 29,914,143 | ||||||
Race Winning Brands, Inc. | ||||||||
2,476,931 | Revolver, 0.500%, 11/16/20272,4,5 | 2,452,162 | ||||||
648,069 | Revolver, 6.250% (3-Month USD Libor+525 basis points), 11/16/20272,3,4,5 | 641,588 | ||||||
21,875,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 11/16/20272,3,4 | 21,656,250 | ||||||
1,964,912 | RCS Consumer Discretionary First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 6/6/20252,3,4,6 | 1,930,526 | ||||||
RefrigiWear, LLC | ||||||||
1,925,403 | Revolver, 0.500%, 11/2/20272,4,5 | 1,906,149 | ||||||
676,493 | Revolver, 5.750% (3-Month USD Libor+475 basis points), 11/2/20272,3,4,5 | 669,728 | ||||||
15,698,104 | First Lien Term Loan, 5.750% (3-Month USD Libor+475 basis points), 11/2/20272,3,4 | 15,541,123 | ||||||
Regent Holding Company, LLC | ||||||||
575,188 | Revolver, 0.500%, 2/25/20262,4,5 | 572,312 | ||||||
2,244,361 | Revolver, 8.750% (1-Week USD Libor+775 basis points), 2/25/20262,3,4,5 | 2,233,139 | ||||||
974,874 | Spring Education Group, Inc. First Lien Term Loan, 4.382% (3-Month USD Libor+425 basis points), 7/30/20251,2,3,4 | 949,618 | ||||||
Stanton Carpet Corp. | ||||||||
1,189,468 | Revolver, 0.500%, 10/1/20262,4,5 | 1,177,574 | ||||||
9,303,571 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 10/1/20272,3,4 | 9,210,536 | ||||||
9,975,000 | Summit Buyer, L.L.C. First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 9/17/20273,4 | 9,775,500 | ||||||
10,000,000 | Truck-Lite Co., LLC First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 12/13/20263,4 | 9,800,000 | ||||||
Twin Brook Consumer Discretionary | ||||||||
4,966,908 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 2/14/20242,3,4,6 | 4,929,656 | ||||||
20,000,000 | First Lien Term Loan, 6.750% (2-Month USD Libor+575 basis points), 2/14/20242,3,4 | 19,850,000 | ||||||
9,950,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 4/20/20262,3,4 | 9,881,345 | ||||||
8,000,000 | Woof Holdings, Inc. Second Lien Term Loan, 8.000% (1-Month USD Libor+725 basis points), 12/21/20281,3,4,16 | 8,085,040 | ||||||
488,186,073 | ||||||||
CONSUMER STAPLES — 2.0% | ||||||||
BCPE North Star US Holdings Co. | ||||||||
2,210,526 | Delayed Draw, 1.000%, 6/10/20282,4,5 | 2,205,000 | ||||||
11,789,474 | First Lien Term Loan, 4.750% (1-Month USD Libor+400 basis points), 6/10/20282,3,4 | 11,760,000 | ||||||
3,580,107 | C.P. Converters, Inc. First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 6/18/20232,3,4 | 3,580,107 | ||||||
13,965,000 | Cardenas Markets, Inc. First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 6/3/20272,3,4 | 14,069,737 |
See accompanying Notes to Consolidated Financial Statements.
10
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
CONSUMER STAPLES (Continued) | ||||||||
$ | 4,937,028 | Easy Ice, LLC First Lien Term Loan, 4.750% (3-Month USD Libor+450 basis points), 12/31/20252,3,4 | $ | 4,937,028 | ||||
1,220,329 | Hoffmaster Group, Inc. First Lien Term Loan, 5.000% (3-Month USD Libor+400 basis points), 11/23/20231,2,3,4 | 1,176,728 | ||||||
8,820,172 | HPS Consumer Staples First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 9/1/20262,3,4,6 | 8,908,374 | ||||||
JTM Foods, LLC | ||||||||
1,158,366 | Delayed Draw, 0.500%, 5/14/20272,4,5 | 1,138,094 | ||||||
559,597 | Revolver, 0.500%, 5/14/20272,4,5 | 549,804 | ||||||
559,597 | Revolver, 5.750% (3-Month USD Libor+475 basis points), 5/14/20272,3,4,5 | 549,804 | ||||||
7,683,828 | First Lien Term Loan, 5.750% (3-Month USD Libor+475 basis points), 5/14/20272,3,4 | 7,549,361 | ||||||
3,728,999 | JUUL Labs, Inc. First Lien Term Loan, 8.500% (3-Month USD Libor+800 basis points), 8/2/20233,4 | 3,721,541 | ||||||
25,000,000 | Maxor National Pharmacy Services, LLC First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 12/6/20273,4 | 24,625,000 | ||||||
Purfoods, LLC | ||||||||
1,125,000 | Delayed Draw, 1.000%, 8/12/20262,4,5 | 1,125,000 | ||||||
1,870,312 | Delayed Draw, 7.000% (3-Month USD Libor+600 basis points), 8/12/20262,3,4,5 | 1,870,312 | ||||||
4,443,750 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 8/12/20262,3,4 | 4,443,750 | ||||||
92,209,640 | ||||||||
ENERGY — 0.0% | ||||||||
488,750 | Kamc Holdings, Inc. First Lien Term Loan, 4.175% (3-Month USD Libor+400 basis points), 8/14/20261,2,3,4 | 476,531 | ||||||
FINANCIALS — 13.7% | ||||||||
5,000,000 | Alacrity First Lien Term Loan, 10.500% PIK (3-Month USD Libor+975 basis points), 12/21/20292,3,4 | 4,850,000 | ||||||
Alera Group Holdings, Inc. | ||||||||
13,341,273 | Delayed Draw, 1.000%, 10/2/20234,5 | 13,274,567 | ||||||
11,642,385 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 10/2/20233,4,5 | 11,584,172 | ||||||
GBP | 10,791,367 | Apus Bidco Limited First Lien Term Loan, 5.651% (3-Month GBP Libor+550 basis points), 2/9/20282,3,4 | 14,343,696 | |||||
AQ Sage Buyer, LLC | ||||||||
18,750,000 | Delayed Draw, 1.000%, 1/25/20272,4,5 | 18,703,125 | ||||||
6,234,375 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 1/25/20272,3,4 | 6,172,031 | ||||||
AxiomSL Group, Inc. | ||||||||
731,098 | Revolver, 0.500%, 12/3/20254,5 | 725,542 | ||||||
713,267 | Delayed Draw, 1.000%, 12/3/20274,5 | 707,846 | ||||||
11,000,357 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 12/3/20273,4 | 10,916,754 | ||||||
CC SAG Acquisition Corp. | ||||||||
699,301 | Revolver, 0.500%, 6/29/20272,4,5 | 689,193 | ||||||
3,356,643 | Delayed Draw, 1.000%, 6/29/20282,4,5 | 3,308,126 | ||||||
1,888,112 | Delayed Draw, 6.500% (3-Month USD Libor+550 basis points), 6/29/20282,3,4,5 | 1,860,822 | ||||||
19,008,304 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 6/29/20282,3,4 | 18,733,558 |
See accompanying Notes to Consolidated Financial Statements.
11
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
FINANCIALS (Continued) | ||||||||
CFGI Holdings, LLC | ||||||||
$ | 1,751,825 | Revolver, 0.500%, 11/2/20272,4,5 | $ | 1,734,307 | ||||
2,189,781 | Delayed Draw, 1.000%, 11/2/20272,4,5 | 2,189,781 | ||||||
16,058,394 | First Lien Term Loan, 6.000% (3-Month USD Libor+525 basis points), 11/2/20272,3,4 | 15,897,810 | ||||||
Credit Connection, LLC | ||||||||
600,000 | Revolver, 0.500%, 7/30/20264,5 | 588,000 | ||||||
4,987,500 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 7/30/20263,4 | 4,887,750 | ||||||
EUR | 627,356 | Dreamstart BidCo First Lien Term Loan, 5.250% (6-Month EUR Libor+525 basis points), 3/30/20272,3,4 | 711,346 | |||||
8,955,000 | Exegy, Inc. First Lien Term Loan, 7.000% (6-Month USD Libor+600 basis points), 5/17/20262,3,4 | 8,809,034 | ||||||
Foundation Risk Partners, Corp. | ||||||||
653,009 | Revolver, 0.500%, 10/29/20272,4,5 | 643,214 | ||||||
576,191 | Delayed Draw, 1.000%, 10/29/20282,4,5 | 569,401 | ||||||
768,246 | Delayed Draw, 6.500% (3-Month USD Libor+575 basis points), 10/29/20282,3,4,5 | 759,191 | ||||||
6,184,379 | First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 10/29/20282,3,4 | 6,091,613 | ||||||
Galway Borrower, LLC | ||||||||
814,315 | Revolver, 0.500%, 5/18/20232,4,5 | 798,029 | ||||||
1,084,966 | Delayed Draw, 1.000%, 5/18/20232,4,5 | 1,074,116 | ||||||
1,357,980 | Delayed Draw, 1.000%, 5/18/20232,4,5 | 1,344,401 | ||||||
10,623,421 | First Lien Term Loan, 6.000% (3-Month USD Libor+525 basis points), 5/18/20232,3,4 | 10,410,952 | ||||||
725,675 | Delayed Draw, 1.000%, 9/30/20232,4,5 | 718,418 | ||||||
1,847,507 | Delayed Draw, 1.000%, 9/30/20232,4,5 | 1,829,032 | ||||||
1,357,980 | Delayed Draw, 6.000% (3-Month USD Libor+525 basis points), 9/30/20232,3,4,5 | 1,344,400 | ||||||
791,789 | Delayed Draw, 6.000% (3-Month USD Libor+525 basis points), 9/30/20232,3,4,5 | 783,871 | ||||||
694,552 | Revolver, 0.500%, 9/30/20272,4,5 | 680,661 | ||||||
879,765 | Revolver, 0.500%, 9/30/20272,4,5 | 862,170 | ||||||
9,063,899 | First Lien Term Loan, 6.000% (3-Month USD Libor+525 basis points), 9/30/20282,3,4 | 8,882,621 | ||||||
11,452,236 | First Lien Term Loan, 6.000% (3-Month USD Libor+525 basis points), 9/30/20282,3,4 | 11,223,191 | ||||||
EUR | 8,500,000 | Groupe Premium First Lien Term Loan, 6.000% (3-Month EUR Libor+600 basis points), 6/8/20283,4 | 9,463,798 | |||||
Helibron Midco B.V. | ||||||||
EUR | 322,466 | First Lien Term Loan, 5.250% (3-Month EUR Libor+525 basis points), 9/17/20262,3,4 | 358,920 | |||||
EUR | 8,850,000 | First Lien Term Loan, 5.000% (3-Month EUR Libor+500 basis points), 9/18/20263,4 | 9,850,461 | |||||
EUR | 859,908 | First Lien Term Loan, 5.250% (3-Month EUR Libor+525 basis points), 9/18/20262,3,4 | 957,118 | |||||
Higginbotham Insurance Agency, Inc. | ||||||||
13,166,667 | Delayed Draw, 1.000%, 11/25/20262,4,5 | 13,092,933 | ||||||
2,536,930 | Delayed Draw, 1.000%, 11/25/20262,4,5 | 2,522,723 | ||||||
1,833,333 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 11/25/20262,3,4,5 | 1,823,067 | ||||||
353,243 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 11/25/20262,3,4,5 | 351,265 | ||||||
1,233,688 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 11/25/20262,3,4 | 1,221,352 |
See accompanying Notes to Consolidated Financial Statements.
12
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
FINANCIALS (Continued) | ||||||||
HPS Financials | ||||||||
$ | 4,199,385 | First Lien Term Loan, 9.500% (3-Month USD Libor+850 basis points), 6/29/20232,3,4,6 | $ | 4,044,717 | ||||
EUR | 3,570,450 | First Lien Term Loan, 5.250% (3-Month EUR Libor+550 basis points), 9/30/20262,3,4 | 3,963,102 | |||||
120,000,000 | HPS Specialty Loan Fund V Feeder LP First Lien Term Loan, 3.175%, 5/14/20314,5,18 | 120,000,000 | ||||||
67,500,000 | First Lien Term Loan, 3.175%, 5/14/20314,5,18 | 67,500,000 | ||||||
Integrity Marketing Acquisition, LLC | ||||||||
3,750,000 | Delayed Draw, 1.000%, 8/27/20252,4,5 | 3,721,875 | ||||||
4,987,500 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 8/27/20252,4 | 4,912,688 | ||||||
Keystone Agency Investors | ||||||||
2,344,737 | Delayed Draw, 1.000%, 5/3/20274,5 | 2,320,821 | ||||||
2,578,125 | Delayed Draw, 1.000%, 5/3/20272,4,5 | 2,539,453 | ||||||
5,625,000 | Delayed Draw, 1.000%, 5/3/20274,5 | 5,540,625 | ||||||
6,694,737 | Delayed Draw, 5.500% (3-Month USD Libor+450 basis points), 5/3/20273,4,5 | 6,626,450 | ||||||
5,945,625 | First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 5/3/20273,4 | 5,884,980 | ||||||
2,003,450 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 5/3/20272,3,4 | 1,973,399 | ||||||
4,375,000 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 5/3/20273,4 | 4,309,375 | ||||||
KWOR Acquisition, Inc. | ||||||||
7,024,390 | First Lien Term Loan, 6.000% (3-Month USD Libor+525 basis points), 12/30/20262,3,4 | 6,919,024 | ||||||
829,268 | Revolver, 0.500%, 9/30/20272,4,5 | 816,829 | ||||||
146,342 | Revolver, 6.000% (3-Month USD Libor+525 basis points), 9/30/20272,3,4,5 | 144,147 | ||||||
1,792,683 | Revolver, 0.500%, 12/22/20274,5 | 1,774,756 | ||||||
316,356 | Revolver, 6.000% (3-Month USD Libor+525 basis points), 12/22/20273,4,5 | 313,192 | ||||||
15,185,079 | First Lien Term Loan, 6.000% (3-Month USD Libor+525 basis points), 12/22/20283,4 | 15,033,228 | ||||||
Patriot Growth Insurance Services, LLC | ||||||||
467,767 | Revolver, 0.500%, 10/14/20282,4,5 | 458,412 | ||||||
2,660,377 | Revolver, 0.500%, 10/14/20284,5 | 2,633,774 | ||||||
8,594,340 | Delayed Draw, 1.000%, 10/14/20284,5 | 8,594,340 | ||||||
1,837,657 | Delayed Draw, 1.000%, 10/14/20282,4,5 | 1,819,281 | ||||||
4,777,909 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 10/14/20282,3,4 | 4,682,351 | ||||||
13,745,283 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 10/14/20283,4,16 | 13,607,830 | ||||||
Peter C. Foy & Associates Insurance Services, LLC | ||||||||
184,900 | Revolver, 0.500%, 11/1/20272,4,5 | 183,051 | ||||||
346,502 | Delayed Draw, 1.000%, 11/1/20282,4,5 | 343,618 | ||||||
762,897 | Delayed Draw, 6.750% (3-Month USD Libor+600 basis points), 11/1/20282,3,4,5 | 756,545 | ||||||
3,993,837 | First Lien Term Loan, 6.750% (3-Month USD Libor+600 basis points), 11/1/20282,3,4 | 3,953,898 | ||||||
11,952,068 | Regent Holding Company, LLC First Lien Term Loan, 8.750% (1-Month USD Libor+775 basis points), 2/25/20261,2,3,4,8 | 11,892,307 | ||||||
Reorg Research, Inc. | ||||||||
3,571,429 | Delayed Draw, 1.000%, 6/28/20242,4,5 | 3,535,714 | ||||||
6,412,500 | First Lien Term Loan, 5.500% (3-Month USD Libor+475 basis points), 6/28/20242,3,4 | 6,348,375 |
See accompanying Notes to Consolidated Financial Statements.
13
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
FINANCIALS (Continued) | ||||||||
Riveron Acquisition Holdings, Inc. | ||||||||
$ | 4,549,771 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 5/22/20252,3,4 | $ | 4,549,771 | ||||
866,588 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 5/22/20252,3,4 | 866,588 | ||||||
RSC Acquisition, Inc. | ||||||||
7,771,084 | Delayed Draw, 1.000%, 11/1/20264,5 | 7,693,374 | ||||||
2,937,146 | Delayed Draw, 1.000%, 11/1/20262,4,5 | 2,907,775 | ||||||
4,156,626 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 11/1/20263,4 | 4,115,060 | ||||||
1,265,060 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 11/1/20263,4,5 | 1,252,409 | ||||||
1,571,032 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 11/1/20262,3,4 | 1,555,321 | ||||||
478,140 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 11/1/20262,3,4,5 | 473,358 | ||||||
1,807,229 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 11/1/20263,4 | 1,789,157 | ||||||
683,057 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 11/1/20262,3,4 | 676,227 | ||||||
1,500,000 | StarCompliance Intermediate, LLC First Lien Term Loan, 7.750% (3-Month USD Libor+675 basis points), 1/12/20273,4 | 1,482,930 | ||||||
THG Acquisition, LLC | ||||||||
743,884 | Revolver, 0.500%, 12/2/20254,5 | 736,445 | ||||||
13,981,177 | Delayed Draw, 1.000%, 12/2/20264,5 | 13,911,271 | ||||||
274,939 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 12/2/20263,4,5 | 273,565 | ||||||
Turbo Buyer, Inc. | ||||||||
2,300,000 | Delayed Draw, 1.000%, 12/2/20252,4,5 | 2,271,250 | ||||||
2,700,000 | Delayed Draw, 7.000% (3-Month USD Libor+600 basis points), 12/2/20252,3,4,5 | 2,666,250 | ||||||
5,000,000 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 12/2/20252,3,4 | 4,900,000 | ||||||
Vale Insurance Services LLC | ||||||||
2,204,403 | Revolver, 0.500%, 12/1/20272,4,5 | 2,182,359 | ||||||
214,952 | Revolver, 6.000% (3-Month USD Libor+500 basis points), 12/1/20272,3,4,5 | 212,802 | ||||||
22,580,645 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 12/1/20272,3,4 | 22,354,839 | ||||||
World Insurance Associates, LLC | ||||||||
8,321,311 | Delayed Draw, 1.000%, 12/1/20274,5 | 8,238,098 | ||||||
6,934,426 | Delayed Draw, 1.000%, 12/1/20272,4,5 | 6,865,082 | ||||||
3,973,771 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 12/1/20273,4,5 | 3,934,033 | ||||||
3,311,476 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 12/1/20272,3,4,5 | 3,278,361 | ||||||
2,704,918 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 4/1/20263,4 | 2,650,820 | ||||||
2,254,098 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 4/1/20262,3,4 | 2,209,016 | ||||||
649,538,696 | ||||||||
GOVERNMENTS — 0.6% | ||||||||
Govdelivery Holdings, LLC | ||||||||
536,402 | Revolver, 0.500%, 1/29/20274,5 | 525,673 | ||||||
3,334,737 | Delayed Draw, 1.000%, 1/29/20274,5 | 3,268,042 | ||||||
6,099,614 | First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 1/29/20273,4 | 5,977,622 | ||||||
5,086,315 | Delayed Draw, 7.500% (3-Month USD Libor+650 basis points), 1/29/20273,4,5 | 4,984,590 | ||||||
LOC Performance Products | ||||||||
3,856,132 | Revolver, 0.500%, 12/30/20264,5 | 3,817,571 |
See accompanying Notes to Consolidated Financial Statements.
14
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
GOVERNMENTS (Continued) | ||||||||
$ | 10,518,750 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 12/30/20262,3,4 | $ | 10,431,444 | ||||
29,004,942 | ||||||||
HEALTH CARE — 17.1% | ||||||||
AAH Topco, LLC | ||||||||
4,118,427 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 12/22/20273,4 | 4,077,243 | ||||||
ACI Group Holdings, Inc. | ||||||||
3,723,214 | Delayed Draw, 1.000%, 8/2/20282,4,5 | 3,685,982 | ||||||
10,178,571 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 8/2/20282,3,4 | 9,975,000 | ||||||
26,786 | Delayed Draw, 6.500% (3-Month USD Libor+575 basis points), 8/2/20282,3,4,5 | 26,518 | ||||||
ADCS Clinics Intermediate Holdings, LLC | ||||||||
1,191,736 | Delayed Draw, 1.000%, 5/7/20272,4,5 | 1,174,455 | ||||||
1,700,826 | Delayed Draw, 7.250% (3-Month USD Libor+625 basis points), 5/7/20272,3,4,5 | 1,676,165 | ||||||
11,079,669 | First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 5/7/20272,3,4 | 10,919,014 | ||||||
20,000,000 | AG-Twin Brook Heath Care First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 12/14/20262,3,4 | 19,700,000 | ||||||
11,940,000 | American Renal Associates Holdings, Inc. First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 1/29/20272,3,4 | 11,827,728 | ||||||
7,900,000 | Angel Medflight First Lien Term Loan, 8.000% (3-Month USD Libor+700 basis points), 10/12/20252,3,4 | 7,900,000 | ||||||
National Dentex Labs LLC | ||||||||
2,966,092 | Delayed Draw, 8.000% (3-Month USD Libor+700 basis points), 6/30/20223,4 | 2,947,999 | ||||||
620,689 | Revolver, 1.000%, 10/23/20254,5 | 610,696 | ||||||
390,805 | Delayed Draw, 1.000%, 10/23/20254,5 | 383,110 | ||||||
298,851 | Revolver, 8.000% (3-Month USD Libor+700 basis points), 10/23/20253,4,5 | 294,039 | ||||||
6,943,678 | First Lien Term Loan, 8.000% (3-Month USD Libor+700 basis points), 10/23/20253,4 | 6,831,885 | ||||||
527,413 | Delayed Draw, 8.000% (3-Month USD Libor+700 basis points), 10/23/20253,4,5 | 517,031 | ||||||
Biocare Medical LLC | ||||||||
2,777,778 | Revolver, 0.500%, 12/9/20274,5 | 2,750,000 | ||||||
22,222,222 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 12/9/20273,4 | 22,000,000 | ||||||
Carevet LLC | ||||||||
9,992,400 | Delayed Draw, 7.500% (3-Month USD Libor+725 basis points), 9/1/20253,4 | 9,792,552 | ||||||
1,000,000 | First Lien Term Loan, 13.000% (3-Month USD Libor+1,200 basis points), 9/1/20253,4 | 985,000 | ||||||
1,333,333 | First Lien Term Loan, 13.000% (3-Month USD Libor+1,200 basis points), 9/1/20253,4 | 1,313,333 | ||||||
Community Medical Acquisition Corp. | ||||||||
3,683,963 | Revolver, 0.500%, 12/15/20274,5 | 3,610,283 | ||||||
4,333,814 | Delayed Draw, 1.000%, 12/15/20284,5 | 4,284,842 | ||||||
676,375 | Delayed Draw, 5.750% (3-Month USD Libor+475 basis points), 12/15/20283,4,5 | 668,732 | ||||||
25,050,946 | First Lien Term Loan, 5.750% (3-Month USD Libor+475 basis points), 12/15/20283,4 | 24,549,927 | ||||||
Connect America.com, LLC | ||||||||
672,304 | Revolver, 0.500%, 6/30/20262,4,5 | 658,858 | ||||||
7,291,058 | First Lien Term Loan, 8.000% (1-Month USD Libor+700 basis points), 6/30/20262,3,4 | 7,145,236 |
See accompanying Notes to Consolidated Financial Statements.
15
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
HEALTH CARE (Continued) | ||||||||
CORA Health Holdings Corp. | ||||||||
$ | 5,401,846 | Delayed Draw, 0.500%, 6/15/20272,4,5 | $ | 5,347,827 | ||||
700,000 | Revolver, 0.500%, 6/15/20272,4,5 | 693,000 | ||||||
69,231 | Revolver, 6.750% (3-Month USD Libor+575 basis points), 6/15/20272,3,4,5 | 68,538 | ||||||
13,759,778 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 6/15/20272,3,4 | 13,622,181 | ||||||
4,075,711 | CPF Dental, LLC Delayed Draw, 10.000% (3-Month USD Libor+850 basis points), 8/30/20242,3,4,17 | 4,011,042 | ||||||
D4C Dental Brands, Inc. | ||||||||
178,571 | Revolver, 0.500%, 12/30/20262,4,5 | 182,857 | ||||||
1,363,379 | Delayed Draw, 1.000%, 12/30/20264,5 | 1,396,100 | ||||||
2,665,988 | Delayed Draw, 7.500% (3-Month USD Libor+650 basis points), 12/30/20262,3,4 | 2,729,972 | ||||||
535,715 | Revolver, 7.500% (3-Month USD Libor+650 basis points), 12/30/20262,3,4,5 | 548,572 | ||||||
6,541,071 | First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 12/30/20262,3,4 | 6,698,057 | ||||||
958,050 | Delayed Draw, 7.500% (3-Month USD Libor+650 basis points), 12/30/20263,4,5 | 981,043 | ||||||
DCA Holdings LLC | ||||||||
2,413,559 | Delayed Draw, 1.000%, 3/12/20272,4,5 | 2,380,252 | ||||||
1,541,243 | Delayed Draw, 7.000% (3-Month USD Libor+625 basis points), 3/12/20272,3,4,5 | 1,519,974 | ||||||
16,005,085 | First Lien Term Loan, 7.000% (3-Month USD Libor+625 basis points), 3/12/20272,3,4 | 15,784,215 | ||||||
Deca Dental Holdings, LLC | ||||||||
1,111,111 | Revolver, 0.500%, 8/26/20284,5 | 1,088,889 | ||||||
3,333,333 | Delayed Draw, 1.000%, 8/26/20284,5 | 3,289,744 | ||||||
1,477,778 | Delayed Draw, 6.500% (3-Month USD Libor+575 basis points), 8/26/20283,4,5 | 1,458,453 | ||||||
14,038,889 | First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 8/26/20283,4 | 13,758,111 | ||||||
ERC Holdings, LLC | ||||||||
1,420,118 | Revolver, 0.500%, 11/10/20274,5 | 1,405,917 | ||||||
3,550,296 | Delayed Draw, 1.000%, 11/10/20284,5 | 3,514,793 | ||||||
15,029,586 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 11/10/20283,4,16 | 14,879,290 | ||||||
Fortis Life Sciences, LLC | ||||||||
1,826,087 | Revolver, 0.500%, 9/17/20274,5 | 1,807,826 | ||||||
12,173,913 | Delayed Draw, 1.000%, 9/17/20274,5 | 12,052,174 | ||||||
4,260,870 | Delayed Draw, 1.000%, 9/17/20274,5 | 4,218,261 | ||||||
608,696 | Revolver, 5.500% (3-Month USD Libor+475 basis points), 9/17/20273,4,5 | 602,609 | ||||||
9,107,609 | First Lien Term Loan, 5.500% (3-Month USD Libor+475 basis points), 9/17/20273,4 | 9,016,533 | ||||||
Heartland Veterinary | ||||||||
519,154 | Revolver, 0.500%, 12/10/20262,4,5 | 513,963 | ||||||
5,052,226 | Delayed Draw, 1.000%, 12/10/20262,4,5 | 5,001,704 | ||||||
819,042 | Delayed Draw, 5.750% (3-Month USD Libor+475 basis points), 12/10/20262,3,4,5 | 810,852 | ||||||
2,609,578 | First Lien Term Loan, 5.750% (3-Month USD Libor+475 basis points), 12/10/20262,3,4 | 2,583,482 | ||||||
86,800 | Second Lien Term Loan, 1.000%, 12/10/20272,4,5 | 86,140 | ||||||
53,200 | Second Lien Term Loan, 9.000% (3-Month USD Libor+800 basis points), 12/10/20272,4,5 | 52,796 |
See accompanying Notes to Consolidated Financial Statements.
16
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
HEALTH CARE (Continued) | ||||||||
$ | 360,000 | Second Lien Term Loan, 9.000% (3-Month USD Libor+800 basis points), 12/10/20272,3,4 | $ | 352,800 | ||||
HPS Healthcare | ||||||||
9,820,571 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 6/27/20242,3,4,6 | 9,820,571 | ||||||
9,875,000 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 7/2/20252,3,4,6 | 10,034,926 | ||||||
Inovalon Holdings, Inc. | ||||||||
1,349,649 | Delayed Draw, 1.000%, 11/24/20334,5 | 1,332,778 | ||||||
12,632,716 | First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 11/24/20283,4,16 | 12,316,898 | ||||||
6,017,635 | Second Lien Term Loan, 11.250% (3-Month USD Libor+1,050 basis points), 11/24/20333,4 | 5,897,283 | ||||||
Integrated Oncology Network, LLC | ||||||||
83,957 | Revolver, 0.500%, 6/24/20242,4,5 | 83,537 | ||||||
4,053,355 | First Lien Term Loan, 7.000% (3-Month USD Libor+550 basis points), 6/24/20242,3,4 | 4,033,089 | ||||||
138,395 | First Lien Term Loan, 7.000% (3-Month USD Libor+550 basis points), 6/24/20243,4 | 135,627 | ||||||
1,269,853 | INW Manufacturing, LLC First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 3/25/20282,3,4 | 1,260,329 | ||||||
Life Science Intermediate Holdings, LLC | ||||||||
3,750,000 | Delayed Draw, 1.000%, 6/10/20252,4,5 | 3,712,500 | ||||||
3,326,366 | Delayed Draw, 7.000% (3-Month USD Libor+600 basis points), 6/10/20252,3,4,5 | 3,293,102 | ||||||
2,907,914 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 6/10/20252,3,4 | 2,878,834 | ||||||
CPF Dental LLC | ||||||||
10,552 | Delayed Draw, 0.500% PIK, 8/30/20244,5,17 | 10,278 | ||||||
5,379,312 | First Lien Term Loan, 10.000% PIK (3-Month USD Libor+850 basis points), 8/30/20243,4,17 | 5,239,450 | ||||||
2,887,292 | Delayed Draw, 11.500% PIK (3-Month USD Libor+1,000 basis points), 8/30/20243,4,5,17 | 2,812,222 | ||||||
14,962,500 | MedData First Lien Term Loan, 5.750% (3-Month USD Libor+475 basis points), 7/22/20283,4 | 14,944,545 | ||||||
MedMark Services, Inc. | ||||||||
1,102,478 | Delayed Draw, 1.000%, 6/11/20272,4,5 | 1,091,454 | ||||||
6,809,914 | Delayed Draw, 1.000%, 6/11/20274,5 | 6,741,814 | ||||||
896,022 | Delayed Draw, 6.000% (3-Month USD Libor+500 basis points), 6/11/20272,3,4,5 | 887,061 | ||||||
7,960,000 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 6/11/20272,3,4 | 7,880,400 | ||||||
1,190,086 | Delayed Draw, 6.000% (3-Month USD Libor+500 basis points), 6/11/20273,4,5 | 1,178,186 | ||||||
OB Hospitalist Group | ||||||||
1,534,351 | Revolver, 0.500%, 9/27/20272,4,5 | 1,503,664 | ||||||
183,206 | Revolver, 6.250% (3-Month USD Libor+525 basis points), 9/27/20272,3,4,5 | 179,542 | ||||||
13,249,237 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 9/27/20272,3,4 | 12,984,252 | ||||||
OIA Acquisition, LLC | ||||||||
1,928,571 | Revolver, 0.500%, 10/19/20272,4,5 | 1,909,286 | ||||||
459,000 | Delayed Draw, 1.000%, 10/19/20272,4,5 | 456,705 | ||||||
1,383,857 | Delayed Draw, 6.250% (3-Month USD Libor+525 basis points), 10/19/20272,3,4,5 | 1,376,938 | ||||||
11,228,571 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 10/19/20272,3,4 | 11,116,286 |
See accompanying Notes to Consolidated Financial Statements.
17
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
HEALTH CARE (Continued) | ||||||||
$ | 1,093,619 | PAW Midco, Inc. First Lien Term Loan, 11.500%,(3-Month USD Libor+1,150 basis points), 12/22/20314 | $ | 1,077,214 | ||||
4,687,355 | Pediatric Home Respiratory Services, LLC First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 12/4/20242,3,4 | 4,663,918 | ||||||
Pinnacle Dermatology Management, LLC | ||||||||
1,082,474 | Revolver, 0.500%, 5/18/20234,5 | 1,068,943 | ||||||
3,092,784 | Delayed Draw, 1.000%, 5/18/20234,5 | 3,092,784 | ||||||
10,824,742 | First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 5/18/20233,4 | 10,689,433 | ||||||
Pinnacle Treatment Centers, Inc. | ||||||||
285,714 | Revolver, 0.500%, 12/31/20222,4,5 | 285,714 | ||||||
228,571 | Delayed Draw, 1.000%, 12/31/20222,4,5 | 228,571 | ||||||
339,429 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 12/31/20222,3,4,5 | 339,429 | ||||||
4,026,071 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 12/31/20222,3,4 | 4,026,071 | ||||||
Premier Imaging LLC | ||||||||
4,862,339 | First Lien Term Loan, 6.250% (3-Month USD Libor+600 basis points), 1/2/20252,3,4 | 4,862,339 | ||||||
2,878,397 | First Lien Term Loan, 6.250% (1-Month USD Libor+600 basis points), 1/2/20252,3,4 | 2,878,397 | ||||||
14,525,790 | Delayed Draw, 1.000%, 1/2/20254,5 | 14,380,532 | ||||||
15,474,210 | First Lien Term Loan, 7.000% (1-Month USD Libor+575 basis points), 1/2/20253,4 | 15,319,468 | ||||||
841,815 | Q-Centrix LLC First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 11/30/20243,4 | 841,815 | ||||||
208,333 | RCS Healthcare Revolver, 0.500%, 2/3/20262,4,5,6 | 209,896 | ||||||
344,132 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 2/3/20262,3,4,6 | 346,713 | ||||||
1,915,278 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 2/3/20262,3,4,6 | 1,929,642 | ||||||
Smile Doctors, LLC | ||||||||
2,102,474 | Revolver, 0.500%, 12/23/20274,5 | 2,081,449 | ||||||
106,007 | Revolver, 6.500% (3-Month USD Libor+575 basis points), 12/23/20273,4,5 | 104,947 | ||||||
2,893,993 | Delayed Draw, 1.000%, 12/23/20284,5 | 2,879,523 | ||||||
197,880 | Delayed Draw, 5.500% (3-Month USD Libor+475 basis points), 12/23/20283,4,5 | 196,890 | ||||||
19,699,647 | First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 12/23/20283,4 | 19,502,650 | ||||||
Spear Education, LLC | ||||||||
1,562,500 | Delayed Draw, 1.000%, 2/26/20252,4,5 | 1,562,500 | ||||||
3,377,344 | First Lien Term Loan, 6.000% (6-Month USD Libor+500 basis points), 2/26/20252,3,4 | 3,377,344 | ||||||
GBP | 1,797,628 | SSCP Pegasus Midco Limited First Lien Term Loan, 6.780% (6-Month GBP Libor+675 basis points), 11/16/20272,3,4 | 2,438,039 | |||||
The Smilist Company | ||||||||
582,039 | Revolver, 0.500%, 12/22/20252,4,5 | 577,441 | ||||||
960,365 | Delayed Draw, 1.000%, 12/22/20252,4,5 | 952,778 | ||||||
1,949,832 | Delayed Draw, 8.000% (3-Month USD Libor+700 basis points), 12/22/20252,3,4,5 | 1,934,428 | ||||||
5,301,215 | First Lien Term Loan, 8.000% (3-Month USD Libor+700 basis points), 12/22/20252,3,4 | 5,259,336 | ||||||
Troy Gastroenterology, P.C. | ||||||||
2,561,576 | Delayed Draw, 0.500%, 11/25/20254,5 | 2,561,576 | ||||||
591,133 | Revolver, 0.500%, 11/25/20254,5 | 591,133 |
See accompanying Notes to Consolidated Financial Statements.
18
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
HEALTH CARE (Continued) | ||||||||
$ | 2,346,798 | Delayed Draw, 7.000% (3-Month USD Libor+600 basis points), 11/25/20253,4,5 | $ | 2,346,798 | ||||
4,449,138 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 11/25/20253,4 | 4,449,138 | ||||||
466,250 | TTF Holdings, LLC First Lien Term Loan, 5.000% (3-Month USD Libor+425 basis points), 3/24/20282,3,4 | 466,250 | ||||||
Twin Brook Healthcare | ||||||||
4,792,399 | First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 11/16/20222,3,4,6 | 4,787,607 | ||||||
4,824,703 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 7/1/20242,3,4,6 | 4,776,456 | ||||||
20,000,000 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 7/1/20242,3,4 | 19,800,000 | ||||||
14,446,089 | First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 11/27/20242,3,4 | 14,295,849 | ||||||
19,949,498 | First Lien Term Loan, 7.750% (3-Month USD Libor+675 basis points), 12/4/20242,3,4 | 19,700,129 | ||||||
9,975,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 8/11/20252,3,4 | 9,850,312 | ||||||
14,961,330 | First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 9/13/20252,3,4 | 14,946,368 | ||||||
9,925,000 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 3/5/20262,3,4 | 9,758,260 | ||||||
CAD | 24,937,500 | First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 7/23/20262,3,4 | 19,516,304 | |||||
15,000,000 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 8/20/20262,3,4 | 14,775,000 | ||||||
24,937,500 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 9/22/20262,3,4 | 24,563,437 | ||||||
20,000,000 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 10/8/20262,3,4 | 19,700,000 | ||||||
Urology Management Holdings, Inc. | ||||||||
10,664,453 | Delayed Draw, 1.000%, 6/15/20262,4,5 | 10,557,808 | ||||||
4,235,781 | Delayed Draw, 6.000% (3-Month USD Libor+500 basis points), 6/15/20262,3,4,5 | 4,193,424 | ||||||
5,099,766 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 6/15/20262,3,4 | 5,048,768 | ||||||
USME Holdings, LLC | ||||||||
743,478 | Delayed Draw, 0.500%, 11/24/20262,4,5 | 743,478 | ||||||
936,232 | Revolver, 0.500%, 11/24/20262,4,5 | 936,232 | ||||||
5,861,087 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 11/24/20262,3,4 | 5,861,087 | ||||||
3,373,659 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 11/24/20263,4 | 3,339,922 | ||||||
Vetcor Professional Practices LLC | ||||||||
1,010,526 | Revolver, 0.500%, 5/20/20262,4,5 | 1,000,421 | ||||||
42,106 | Revolver, 5.000% (3-Month USD Libor+425 basis points), 5/20/20262,3,4,5 | 41,684 | ||||||
7,920,421 | Delayed Draw, 1.000%, 5/20/20282,4,5 | 7,880,819 | ||||||
15,000,000 | Delayed Draw, 4.405% (3-Month USD Libor+425 basis points), 5/20/20282,3,4 | 14,949,000 | ||||||
1,553,263 | Delayed Draw, 5.000% (3-Month USD Libor+425 basis points), 5/20/20282,3,4,5 | 1,545,497 | ||||||
9,473,684 | Second Lien Delayed Draw, 1.000%, 11/3/20282,4,5 | 9,402,632 | ||||||
Vital Care Buyer, LLC | ||||||||
1,777,778 | Revolver, 0.500%, 10/19/20252,4,5 | 1,777,778 | ||||||
5,570,385 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 10/19/20252,3,4 | 5,570,385 | ||||||
WCAS Orthopedics MSO, LLC | ||||||||
1,724,138 | Revolver, 0.500%, 12/4/20264,5 | 1,706,897 | ||||||
8,275,862 | First Lien Term Loan, 5.750% (3-Month USD Libor+500 basis points), 12/6/20273,4 | 8,193,103 |
See accompanying Notes to Consolidated Financial Statements.
19
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
HEALTH CARE (Continued) | ||||||||
Zavation Medical Products, LLC | ||||||||
$ | 1,621,622 | Revolver, 0.500%, 6/30/20272,4,5 | $ | 1,605,405 | ||||
405,405 | Revolver, 5.500% (3-Month USD Libor+450 basis points), 6/30/20272,3,4,5 | 401,352 | ||||||
12,908,108 | First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 6/30/20272,3,4 | 12,779,027 | ||||||
809,402,692 | ||||||||
INDUSTRIALS — 24.2% | ||||||||
4,480,592 | 3SI Holdco, Inc. First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 6/16/20232,3,4 | 4,480,592 | ||||||
15,018,281 | Aero Operating LLC Incremental Term Loan, 8.000% (1-Month USD Libor+650 basis points), 2/7/20262,3,4 | 14,868,098 | ||||||
Air Comm Corporation, LLC | ||||||||
1,653,022 | Revolver, 0.500%, 7/1/20272,4,5 | 1,636,492 | ||||||
950,612 | Revolver, 0.500%, 7/1/20274,5 | 941,106 | ||||||
243,902 | Delayed Draw, 1.000%, 7/1/20272,4,5 | 241,463 | ||||||
1,588,658 | Delayed Draw, 1.000%, 7/1/20274,5 | 1,580,715 | ||||||
8,880,183 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 7/1/20272,3,4,5 | 8,791,382 | ||||||
786,002 | Revolver, 6.250% (3-Month USD Libor+550 basis points), 7/1/20272,3,4,5 | 778,142 | ||||||
13,347,561 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 7/1/20272,3,4 | 13,214,085 | ||||||
12,227,132 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 7/1/20273,4,5 | 12,165,996 | ||||||
233,599 | Revolver, 6.250% (3-Month USD Libor+550 basis points), 7/1/20273,4,5 | 231,262 | ||||||
4,912,500 | Airnov, Inc. First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 12/19/20252,3,4 | 4,912,500 | ||||||
997,500 | AIT Worldwide Logistics Holdings, Inc. First Lien Term Loan, 5.500% (1-Month USD Libor+475 basis points), 4/6/20281,2,3,4 | 1,002,094 | ||||||
Any Hour, LLC | ||||||||
2,000,000 | Revolver, 0.500%, 7/21/20272,4,5 | 1,980,000 | ||||||
546,667 | Delayed Draw, 1.000%, 7/21/20272,4,5 | 541,200 | ||||||
6,120,000 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 7/21/20272,3,4,5 | 6,058,800 | ||||||
11,333,333 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 7/21/20272,3,4 | 11,220,000 | ||||||
Ardurra Group LLC | ||||||||
651,720 | Delayed Draw, 1.000%, 5/20/20224,5 | 651,720 | ||||||
4,887,899 | Delayed Draw, 8.250% (3-Month USD Libor+725 basis points), 5/20/20223,4,5 | 4,887,899 | ||||||
8,374,601 | First Lien Term Loan, 8.500% (3-Month USD Libor+725 basis points), 9/1/20253,4 | 8,290,855 | ||||||
Armada Parent, Inc. | ||||||||
2,200,000 | Revolver, 0.500%, 10/29/20272,4,5 | 2,156,000 | ||||||
2,000,000 | Delayed Draw, 1.000%, 10/29/20272,4,5 | 1,980,000 | ||||||
200,000 | Revolver, 6.500% (3-Month USD Libor+575 basis points), 10/29/20272,3,4,5 | 196,000 | ||||||
20,000,000 | First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 10/29/20272,3,4 | 19,600,000 | ||||||
10,000,000 | Armstrong Transport Group First Lien Term Loan, 6.000% (6-Month USD Libor+500 basis points), 6/18/20243,4 | 9,800,000 |
See accompanying Notes to Consolidated Financial Statements.
20
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
INDUSTRIALS (Continued) | ||||||||
AWT Merger Sub, Inc. | ||||||||
$ | 985,714 | Revolver, 0.500%, 12/17/20262,4,5 | $ | 985,714 | ||||
1,142,857 | Delayed Draw, 1.000%, 12/17/20262,4,5 | 1,142,857 | ||||||
2,421,429 | Delayed Draw, 1.000%, 12/17/20264,5 | 2,397,214 | ||||||
1,357,143 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 12/17/20262,3,4,5 | 1,357,143 | ||||||
85,715 | Revolver, 6.750% (3-Month USD Libor+575 basis points), 12/17/20262,3,4,5 | 85,715 | ||||||
6,380,357 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 12/17/20262,3,4 | 6,380,357 | ||||||
BCHR US Acquisitions, Inc. | ||||||||
905,660 | Revolver, 0.500%, 9/29/20264,5 | 887,547 | ||||||
1,886,792 | Delayed Draw, 1.000%, 9/29/20264,5 | 1,867,925 | ||||||
226,416 | Revolver, 7.750% (3-Month USD Libor+675 basis points), 9/29/20263,4,5 | 221,887 | ||||||
6,963,679 | First Lien Term Loan, 7.750% (3-Month USD Libor+675 basis points), 9/29/20263,4 | 6,824,406 | ||||||
9,897,959 | BDP International, Inc. First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 12/19/20242,3,4 | 9,897,959 | ||||||
Beacon Mobility Corp. | ||||||||
1,000,000 | Revolver, 0.500%, 5/22/20244,5 | 992,000 | ||||||
585,797 | Delayed Draw, 1.000%, 5/22/20242,4,5 | 581,110 | ||||||
165,214 | Delayed Draw, 1.000%, 5/22/20244,5 | 163,892 | ||||||
17,117,032 | Delayed Draw, 6.500% (3-Month USD Libor+550 basis points), 5/22/20242,3,4,5 | 16,980,097 | ||||||
2,260,169 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 5/22/20242,3,4 | 2,242,087 | ||||||
4,827,553 | Delayed Draw, 6.500% (3-Month USD Libor+550 basis points), 5/22/20243,4,5 | 4,788,933 | ||||||
Blackbird Purchaser, Inc. | ||||||||
4,392,446 | Delayed Draw, 1.000%, 4/8/20264,5 | 4,348,521 | ||||||
10,713,282 | Delayed Draw, 1.000%, 4/8/20264,5 | 10,713,282 | ||||||
8,976,105 | First Lien Term Loan, 5.250% (3-Month USD Libor+450 basis points), 4/8/20263,4 | 8,886,344 | ||||||
BlueHalo Global Holdings, LLC | ||||||||
548,120 | Revolver, 0.500%, 10/31/20254,5 | 542,639 | ||||||
737,594 | Revolver, 7.000% (3-Month USD Libor+600 basis points), 10/31/20253,4,5 | 730,218 | ||||||
17,372,986 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 10/31/20253,4 | 17,199,257 | ||||||
BP Purchaser, LLC | ||||||||
15,000,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 12/10/20283,4 | 14,700,000 | ||||||
9,891,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 12/10/20282,3,4 | 9,693,180 | ||||||
British Engineering Services Holdco Limited | ||||||||
GBP | 950,968 | Revolver, 7.000% (3-Month GBP Libor+675 basis points), 12/2/20272,3,4 | 1,292,328 | |||||
GBP | 396,237 | First Lien Term Loan, 7.000% (3-Month GBP Libor+675 basis points), 12/2/20272,3,4 | 538,470 | |||||
Citrin Cooperman Advisors, LLC | ||||||||
2,647,059 | Delayed Draw, 1.000%, 10/1/20274,5 | 2,633,824 | ||||||
6,176,471 | First Lien Term Loan, 5.750% (6-Month USD Libor+500 basis points), 10/1/20273,4 | 6,083,824 | ||||||
4,426,168 | Colonial Bag, LLC First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 9/3/20252,3,4 | 4,426,168 |
See accompanying Notes to Consolidated Financial Statements.
21
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
INDUSTRIALS (Continued) | ||||||||
Comar Holding Company, LLC | ||||||||
$ | 4,936,100 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 6/18/20242,3,4 | $ | 4,936,100 | ||||
777,993 | Delayed Draw, 7.250% (3-Month USD Libor+600 basis points), 6/18/20242,3,4 | 777,993 | ||||||
14,759,098 | Construction Resources Company LLC First Lien Term Loan, 7.250% (3-Month USD Libor+575 basis points), 6/10/20242,3,4 | 14,759,098 | ||||||
Continental Acquisition Holdings, Inc. | ||||||||
2,678,571 | Delayed Draw, 7.750% (3-Month USD Libor+600 basis points), 1/20/20272,3,4 | 2,683,661 | ||||||
7,266,518 | First Lien Term Loan, 7.750% (3-Month USD Libor+675 basis points), 1/20/20272,3,4 | 7,280,324 | ||||||
Dispatch Acquisition Holdings, LLC | ||||||||
7,960,000 | First Lien Term Loan, 5.000% (3-Month USD Libor+425 basis points), 3/25/20282,3,4 | 7,940,100 | ||||||
13,930,000 | First Lien Term Loan, 5.000% (3-Month USD Libor+425 basis points), 3/25/20283,4 | 13,895,175 | ||||||
5,000,000 | EShipping First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 11/5/20273,4 | 4,900,000 | ||||||
FLS Holding, Inc. | ||||||||
2,000,000 | Revolver, 0.500%, 12/17/20274,5 | 1,960,000 | ||||||
833,333 | Revolver, 0.500%, 12/17/20272,4,5 | 816,667 | ||||||
5,000,000 | Delayed Draw, 1.000%, 12/17/20284,5 | 4,950,000 | ||||||
�� | 2,083,333 | Delayed Draw, 1.000%, 12/17/20282,4,5 | 2,062,500 | |||||
23,000,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 12/17/20283,4 | 22,540,000 | ||||||
9,583,333 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 12/17/20282,3,4 | 9,391,667 | ||||||
Fortis Solutions Group, LLC | ||||||||
1,799,100 | Revolver, 0.500%, 10/15/20272,4,5 | 1,763,118 | ||||||
642,536 | Revolver, 0.500%, 10/15/20272,4,5 | 629,685 | ||||||
5,247,376 | Delayed Draw, 1.000%, 10/15/20282,4,5 | 5,194,903 | ||||||
1,874,063 | Delayed Draw, 1.000%, 10/15/20282,4,5 | 1,855,322 | ||||||
12,953,523 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 10/15/20282,3,4 | 12,694,453 | ||||||
4,626,258 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 10/15/20282,3,4 | 4,533,733 | ||||||
Gerson Lehrman Group, Inc. | ||||||||
9,847,716 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 12/5/20242,3,4 | 9,847,716 | ||||||
29,850,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 12/5/20243,4 | 29,850,000 | ||||||
Graffiti Buyer, Inc. | ||||||||
2,059,896 | Revolver, 0.500%, 8/10/20274,5 | 2,039,297 | ||||||
5,044,643 | Delayed Draw, 1.000%, 8/10/20274,5 | 4,994,196 | ||||||
462,425 | Revolver, 6.750% (3-Month USD Libor+575 basis points), 8/10/20273,4,5 | 457,801 | ||||||
11,238,203 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 8/10/20273,4 | 11,125,821 | ||||||
HPS Industrials | ||||||||
9,849,246 | First Lien Term Loan, 8.500% (3-Month USD Libor+750 basis points), 5/31/20222,3,4,6 | 9,849,246 | ||||||
9,870,221 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 7/25/20252,3,4,6 | 9,736,696 | ||||||
24,869,359 | First Lien Term Loan, 7.750% (3-Month USD Libor+675 basis points), 10/15/20262,3,4 | 24,247,625 | ||||||
14,962,120 | Intergulf Corp. First Lien Term Loan, 6.750% (2-Month USD Libor+575 basis points), 11/16/20232,3,4 | 14,849,904 |
See accompanying Notes to Consolidated Financial Statements.
22
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
INDUSTRIALS (Continued) | ||||||||
Isaac Heating & Air Conditioning | ||||||||
$ | 1,736,842 | Revolver, 0.500%, 5/7/20272,4,5 | $ | 1,719,474 | ||||
2,210,526 | Delayed Draw, 1.000%, 5/7/20272,4,5 | 2,188,421 | ||||||
631,579 | Revolver, 6.000% (3-Month USD Libor+500 basis points), 5/7/20272,3,4,5 | 625,263 | ||||||
7,855,263 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 5/7/20272,3,4 | 7,776,711 | ||||||
2,520,000 | Delayed Draw, 6.250% (3-Month USD Libor+525 basis points), 5/7/20272,3,4,5 | 2,494,800 | ||||||
ISS Compressors Industries, Inc. | ||||||||
375,000 | Revolver, 0.500%, 8/9/20262,4,5 | 366,263 | ||||||
4,482,291 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 8/9/20262,3,4 | 4,377,854 | ||||||
41,667 | Revolver, 6.500% (3-Month USD Libor+550 basis points), 8/9/20262,3,4,5 | 40,696 | ||||||
Jade Bidco Limited | ||||||||
EUR | 538,430 | First Lien Term Loan, 6.000% (6-Month EUR Libor+600 basis points), 12/3/20262,3,4 | 609,902 | |||||
3,375,128 | First Lien Term Loan, 6.270% (3-Month USD Libor+600 basis points), 12/3/20262,3,4 | 3,358,253 | ||||||
Komline-Sanderson Group, Inc. | ||||||||
1,210,938 | Revolver, 0.500%, 3/17/20262,4,5 | 1,210,938 | ||||||
9,512,374 | Delayed Draw, 6.500% (3-Month USD Libor+600 basis points), 3/17/20262,3,4 | 9,512,373 | ||||||
1,132,812 | Revolver, 6.500% (3-Month USD Libor+600 basis points), 3/17/20262,3,4,5 | 1,132,812 | ||||||
8,048,555 | First Lien Term Loan, 6.500% (3-Month USD Libor+600 basis points), 3/17/20262,3,4 | 8,048,555 | ||||||
KPSKY Acquisition, Inc. | ||||||||
753,205 | Delayed Draw, 1.000%, 10/19/20282,4,5 | 741,907 | ||||||
377,074 | Delayed Draw, 1.000%, 10/19/20282,4,5 | 371,418 | ||||||
13,181,090 | First Lien Term Loan, 6.250% (1-Month USD Libor+550 basis points), 10/19/20282,3,4 | 12,917,468 | ||||||
6,598,793 | First Lien Term Loan, 6.250% (1-Month USD Libor+550 basis points), 10/19/20282,3,4 | 6,466,817 | ||||||
753,205 | Delayed Draw, 7.750% (1-Month USD Libor+450 basis points), 10/19/20282,3,4,5 | 741,907 | ||||||
377,074 | Delayed Draw, 7.750% (1-Month USD Libor+450 basis points), 10/19/20282,3,4,5 | 371,418 | ||||||
5,312,208 | Lav Gear Holdings, Inc. First Lien Term Loan, 8.500% (1-Month USD Libor+750 basis points), 10/31/20242,3,4,17 | 5,033,317 | ||||||
18,453,750 | Lereta, LLC First Lien Term Loan, 6.000% (1-Month USD Libor+525 basis points), 7/30/20283 | 18,469,159 | ||||||
Majco LLC | ||||||||
1,666,667 | Revolver, 0.500%, 12/23/20284,5 | 1,650,000 | ||||||
7,583,333 | Delayed Draw, 1.000%, 12/23/20284,5 | 7,583,333 | ||||||
1,745,625 | Delayed Draw, 5.500% (3-Month USD Libor+450 basis points), 12/23/20283,4,5 | 1,745,625 | ||||||
9,000,000 | First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 12/23/20283,4 | 8,910,000 | ||||||
System Planning and Analysis, Inc. | ||||||||
2,195,341 | Revolver, 0.500%, 8/16/20272,4,5 | 2,162,410 | ||||||
15,304,660 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 8/16/20272,3,4 | 15,075,090 | ||||||
4,987,500 | MHE Intermediate First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 11/25/20262,3,4 | 4,937,625 | ||||||
Northstar Recycling | ||||||||
2,000,000 | Revolver, 0.500%, 10/1/20274,5 | 1,960,000 | ||||||
9,300,000 | First Lien Term Loan, 5.750% (3-Month USD Libor+475 basis points), 10/1/20273,4 | 9,114,000 |
See accompanying Notes to Consolidated Financial Statements.
23
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
INDUSTRIALS (Continued) | ||||||||
Omni Intermediate Holdings, LLC | ||||||||
$ | 1,689,141 | Revolver, 0.500%, 12/30/20254,5 | $ | 1,672,249 | ||||
532,394 | Revolver, 0.500%, 12/30/20252,4,5 | 527,070 | ||||||
563,380 | Revolver, 7.250% (1-Month USD Libor+400 basis points), 12/30/20253,4,5 | 557,747 | ||||||
177,465 | Revolver, 7.250% (1-Month USD Libor+400 basis points), 12/30/20252,3,4,5 | 175,691 | ||||||
2,676,056 | Delayed Draw, 1.000%, 12/30/20264,5 | 2,662,676 | ||||||
842,958 | Delayed Draw, 1.000%, 12/30/20262,4,5 | 838,743 | ||||||
2,388,380 | Delayed Draw, 6.000% (1-Month USD Libor+500 basis points), 12/30/20263,4 | 2,376,438 | ||||||
752,340 | Delayed Draw, 6.000% (1-Month USD Libor+500 basis points), 12/30/20262,3,4 | 748,578 | ||||||
140,845 | Delayed Draw, 6.000% (1-Month USD Libor+500 basis points), 12/30/20263,4,5 | 140,141 | ||||||
44,366 | Delayed Draw, 6.000% (1-Month USD Libor+500 basis points), 12/30/20262,3,4,5 | 44,144 | ||||||
22,478,873 | First Lien Term Loan, 6.000% (1-Month USD Libor+500 basis points), 12/30/20263,4 | 22,254,084 | ||||||
7,080,845 | First Lien Term Loan, 6.000% (1-Month USD Libor+500 basis points), 12/30/20262,3,4 | 7,010,037 | ||||||
9,500,000 | PaperWorks Industries, Inc First Lien Term Loan, 8.250% (3-Month USD Libor+725 basis points), 12/18/20252,3,4 | 9,416,875 | ||||||
PCX Holding Corp. | ||||||||
625,000 | Revolver, 0.500%, 4/22/20272,4,5 | 625,000 | ||||||
625,000 | Delayed Draw, 1.000%, 4/22/20272,4,5 | 625,000 | ||||||
2,493,750 | Delayed Draw, 7.250% (3-Month USD Libor+625 basis points), 4/22/20272,3,4,5 | 2,493,750 | ||||||
6,218,750 | First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 4/22/20272,3,4 | 6,218,750 | ||||||
977,500 | PHM Netherlands Midco B.V. First Lien Term Loan, 4.750% (3-Month USD Libor+475 basis points), 8/1/20261,2,3,4,9 | 975,056 | ||||||
5,000,000 | Pregis TopCo LLC Second Lien Term Loan, 8.750% (3-Month USD Libor+800 basis points), 8/1/20272,3,4 | 5,000,000 | ||||||
15,518,868 | Prime Buyer, LLC First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 12/10/20273,4 | 15,363,679 | ||||||
25,000,000 | PrimeFlight Aviation Services, Inc. First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 5/9/20243,4 | 24,625,000 | ||||||
PT Intermediate Holdings III, LLC | ||||||||
13,100,000 | Delayed Draw, 1.000%, 10/15/20254,5 | 13,100,000 | ||||||
3,470,000 | Delayed Draw, 1.000%, 10/15/20252,4,5 | 3,470,000 | ||||||
9,410,000 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 10/15/20253,4 | 9,315,900 | ||||||
2,490,000 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 10/15/20252,3,4 | 2,465,100 | ||||||
2,490,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 10/15/20253,4 | 2,465,100 | ||||||
3,760,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 10/15/20252,3,4 | 3,722,400 | ||||||
1,466,250 | Q Holding Co. First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 12/20/20232,3,4 | 1,449,755 | ||||||
RCS Industrials | ||||||||
285,714 | Revolver, 0.500%, 1/31/20254,5 | 285,714 | ||||||
1,688,571 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 1/31/20253,4,6 | 1,688,571 |
See accompanying Notes to Consolidated Financial Statements.
24
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
INDUSTRIALS (Continued) | ||||||||
$ | 17,000,000 | Retail Services WIS Corporation Delayed Draw, 8.750% (3-Month USD Libor+775 basis points), 5/20/20253,4 | $ | 16,830,000 | ||||
RQM Buyer, Inc. | ||||||||
4,687,500 | Delayed Draw, 1.000%, 8/12/20234,5 | 4,640,625 | ||||||
20,261,719 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 8/12/20263,4 | 20,059,102 | ||||||
S4T Holdings Corp. | ||||||||
4,545,455 | First Lien Term Loan, 1.000%, 12/27/20264,5 | 4,522,727 | ||||||
15,454,546 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 12/27/20263,4 | 15,222,727 | ||||||
10,000,000 | Safety Products Holdings, LLC First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 12/15/20263 | 9,775,000 | ||||||
Seko Global Logistics Network, LLC | ||||||||
58,596 | Revolver, 0.500%, 12/30/20264,5 | 57,717 | ||||||
6,121 | Revolver, 6.000% (3-Month USD Libor+500 basis points), 12/30/20263,4,5 | 6,029 | ||||||
EUR | 10,569,991 | Seko Worldwide, LLC First Lien Term Loan, 6.000% (1-Month EUR Libor+500 basis points), 12/30/20263,4 | 11,852,733 | |||||
Sonny’s Enterprises, LLC | ||||||||
548,780 | Revolver, 0.500%, 8/5/20252,4,5 | 548,780 | ||||||
91,464 | Revolver, 8.000% (3-Month USD Libor+700 basis points), 8/5/20252,3,4,5 | 91,464 | ||||||
6,525,000 | Delayed Draw, 1.000%, 8/5/20262,5 | 6,394,500 | ||||||
2,175,000 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 8/5/20262,3,4 | 2,131,500 | ||||||
905,488 | Delayed Draw, 7.750% (3-Month USD Libor+675 basis points), 8/5/20262,3,4 | 905,488 | ||||||
5,870,808 | First Lien Term Loan, 7.750% (3-Month USD Libor+675 basis points), 8/5/20262,3,4 | 5,870,808 | ||||||
Spartronics LLC | ||||||||
1,441,631 | Revolver, 0.500%, 12/31/20252,4,5 | 1,430,819 | ||||||
837,871 | Revolver, 0.500%, 12/31/20254,5 | 831,587 | ||||||
1,205,428 | Revolver, 5.500% (3-Month USD Libor+475 basis points), 12/31/20252,3,4,5 | 1,196,387 | ||||||
4,537,858 | First Lien Term Loan, 5.500% (3-Month USD Libor+475 basis points), 12/31/20252,3,4 | 4,503,824 | ||||||
700,591 | Revolver, 5.500% (3-Month USD Libor+475 basis points), 12/31/20253,4,5 | 695,336 | ||||||
8,348,363 | First Lien Term Loan, 5.500% (3-Month USD Libor+475 basis points), 12/31/20253,4 | 8,285,750 | ||||||
10,000,000 | Standard Elevator Systems First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 12/2/20273,4 | 9,800,000 | ||||||
1,750,000 | Sweep Purchaser LLC Delayed Draw, 1.000%, 11/30/20262,4,5 | 1,732,500 | ||||||
977,500 | Tank Holding Corp. First Lien Term Loan, 4.000% (3-Month USD Libor+400 basis points), 3/26/20261,2,3,4 | 971,088 | ||||||
133,712 | TecoStar Holdings, Inc. First Lien Term Loan, 4.250% (3-Month USD Libor+325 basis points), 5/1/20241,2,3,4 | 132,249 | ||||||
The Vertex Companies, Inc. | ||||||||
1,304,348 | Revolver, 0.500%, 8/31/20264,5 | 1,284,783 | ||||||
3,913,043 | Delayed Draw, 1.000%, 8/31/20274,5 | 3,883,696 | ||||||
9,758,152 | First Lien Term Loan, 6.500% (1-Month USD Libor+550 basis points), 8/31/20273,4,15 | 9,611,780 |
See accompanying Notes to Consolidated Financial Statements.
25
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
INDUSTRIALS (Continued) | ||||||||
Time Manufacturing Acquisition, LLC | ||||||||
$ | 1,369,863 | Revolver, 0.500%, 12/1/20274,5 | $ | 1,354,521 | ||||
EUR | 11,134,894 | Delayed Draw, 1.000%, 12/1/20274,5 | 12,391,119 | |||||
$ | 5,215,084 | Delayed Draw, 1.000%, 12/1/20274,5 | 5,097,744 | |||||
1,643,836 | Revolver, 7.250% (3-Month USD Libor+650 basis points), 12/1/20273,4,5 | 1,625,424 | ||||||
18,273,329 | First Lien Term Loan, 7.250% (3-Month USD Libor+650 basis points), 12/1/20273,4 | 17,862,179 | ||||||
Titan Group Holdco, LLC | ||||||||
2,000,000 | Revolver, 0.500%, 8/12/20274,5 | 1,980,000 | ||||||
2,500,000 | Delayed Draw, 1.000%, 8/12/20274,5 | 2,475,000 | ||||||
2,500,000 | Delayed Draw, 1.000%, 8/12/20274,5 | 2,475,000 | ||||||
3,750,000 | Delayed Draw, 1.000%, 8/12/20274,5 | 3,712,500 | ||||||
500,000 | Revolver, 5.500% (3-Month USD Libor+450 basis points), 8/12/20273,4,5 | 495,000 | ||||||
8,750,000 | First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 8/12/20273,4 | 8,662,500 | ||||||
Transtar Holding Company | ||||||||
1,448,276 | Delayed Draw, 1.000%, 1/22/20272,4,5 | 1,433,793 | ||||||
10,472,586 | First Lien Term Loan, 8.000% (1-Month USD Libor+700 basis points), 1/22/20272,3,4 | 10,367,860 | ||||||
Trident Maritime Systems, Inc. | ||||||||
1,444,444 | Revolver, 1.000%, 2/26/20272,4,5 | 1,437,222 | ||||||
13,453,889 | First Lien Term Loan, 6.500% (1-Month USD Libor+550 basis points), 2/26/20272,3,4 | 13,386,619 | ||||||
4,980,927 | Trystar, Inc. First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 9/28/20233,4 | 4,951,041 | ||||||
14,598,913 | TSL Engineered Products, LLC First Lien Term Loan, 5.500% (3-Month USD Libor+475 basis points), 1/8/20282,3,4 | 14,562,416 | ||||||
7,350,000 | Twin Brook Aerospace First Lien Term Loan, 8.250% (1-Month USD Libor+725 basis points), 12/6/20242,3,4,6 | 7,324,275 | ||||||
USRP Holdings, Inc. | ||||||||
634,409 | Revolver, 0.500%, 7/3/20272,4,5 | 621,720 | ||||||
6,892,844 | Delayed Draw, 1.000%, 7/3/20272,4,5 | 6,754,987 | ||||||
2,015,202 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 7/3/20272,3,4,5 | 1,974,898 | ||||||
10,752 | Revolver, 6.250% (3-Month USD Libor+550 basis points), 7/3/20272,3,4,5 | 10,538 | ||||||
14,545,792 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 7/3/20272,3,4 | 14,254,876 | ||||||
EUR | 1,300,000 | UTAC Group First Lien Term Loan, 5.250% (3-Month EUR Libor+575 basis points), 9/29/20272,3,4 | 1,471,084 | |||||
17,194,737 | Valcourt Holdings II, LLC First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 1/7/20272,3,4 | 17,108,763 | ||||||
VLS Recovery Services, LLC | ||||||||
2,040,816 | Revolver, 0.500%, 10/17/20244,5 | 2,020,408 | ||||||
5,952,381 | Delayed Draw, 1.000%, 10/17/20244,5 | 5,892,857 | ||||||
191,327 | Revolver, 6.500% (1-Month USD Libor+550 basis points), 10/17/20243,4,5 | 189,413 | ||||||
16,815,476 | First Lien Term Loan, 6.500% (1-Month USD Libor+550 basis points), 10/17/20243,4 | 16,647,321 |
See accompanying Notes to Consolidated Financial Statements.
26
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
INDUSTRIALS (Continued) | ||||||||
VRC Companies, LLC | ||||||||
$ | 625,000 | Revolver, 0.500%, 6/29/20274,5 | $ | 612,500 | ||||
1,890,625 | Delayed Draw, 1.000%, 6/29/20274,5 | 1,852,813 | ||||||
1,233,793 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 6/29/20273,4,5 | 1,209,117 | ||||||
18,656,250 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 6/29/20273,4,16 | 18,283,125 | ||||||
1,142,148,789 | ||||||||
MATERIALS — 4.8% | ||||||||
1,380,869 | ADG Acquisiton, LLC Delayed Draw, 6.875% (3-Month USD Libor+588 basis points), 12/14/20232,3,4 | 1,365,225 | ||||||
25,000,000 | Airnov, Inc. First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 12/19/20252,3,4 | 25,000,000 | ||||||
1,193,004 | Anchor Packaging LLC First Lien Term Loan, 4.091% (1-Month USD Libor+400 basis points), 7/18/20261,2,3,4 | 1,187,039 | ||||||
Answer Acquisition, LLC | ||||||||
1,333,571 | Revolver, 0.500%, 12/29/20262,4,5 | 1,306,900 | ||||||
17,336,429 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 12/29/20262,3,4 | 16,989,700 | ||||||
Berlin Packaging LLC | ||||||||
EUR | 4,527,699 | Second Lien Term Loan, 1.000%, 11/7/20264,5 | 5,090,053 | |||||
EUR | 13,068,750 | Second Lien Term Loan, 7.000% (3-Month USD Libor+700 basis points), 11/7/20263,4 | 14,505,955 | |||||
9,950,000 | Colonial Bag, LLC Incremental Term Loan, 6.000% (3-Month USD Libor+500 basis points), 9/3/20252,3,4 | 9,950,000 | ||||||
Consolidated Label Co. | ||||||||
1,339,286 | Revolver, 0.500%, 7/15/20262,4,5 | 1,332,589 | ||||||
578,516 | Revolver, 0.500%, 7/15/20262,4,5 | 575,623 | ||||||
3,703,712 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 7/15/20262,3,4 | 3,685,193 | ||||||
4,987,500 | Incremental Term Loan, 6.000% (3-Month USD Libor+500 basis points), 7/15/20262,3,4 | 4,962,562 | ||||||
8,574,056 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 7/15/20262,3,4 | 8,531,186 | ||||||
3,312,401 | Cyxtera Equipment Leases First Lien Term Loan, 8.250%, (3-Month USD Libor+825 basis points), 1/1/20244 | 3,312,401 | ||||||
557,355 | Helix Acquisition Holdings, Inc. First Lien Term Loan, 4.000% (3-Month USD Libor+300 basis points), 9/29/20241,3,4 | 545,080 | ||||||
7,807,794 | HPS Materials First Lien Term Loan, 6.875% (3-Month USD Libor+588 basis points), 12/14/20232,3,4,6 | 7,719,340 | ||||||
8,000,000 | IG Investment Holdings, LLC First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 11/2/20263,4 | 7,840,000 | ||||||
3,500,000 | North Haven Goldfinc First Lien Term Loan, 11.750%, (3-Month USD Libor+1,175 basis points), 9/17/20244 | 3,395,000 | ||||||
Olympic Buyer, Inc. | ||||||||
2,352,941 | Revolver, 0.500%, 6/30/20262,4,5 | 2,299,529 | ||||||
17,647,059 | First Lien Term Loan, 5.000% (1-Month USD Libor+425 basis points), 6/30/20282,3,4 | 17,246,471 | ||||||
9,000,000 | First Lien Term Loan, 5.000% (3-Month USD Libor+425 basis points), 6/30/20283,4 | 8,820,000 |
See accompanying Notes to Consolidated Financial Statements.
27
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
MATERIALS (Continued) | ||||||||
EUR | 12,701,000 | Optimum Group First Lien Term Loan, 5.500% (3-Month EUR Libor+575 basis points), 6/16/20283,4 | $ | 14,184,518 | ||||
$ | 980,000 | Pregis TopCo LLC First Lien Term Loan, 4.090% (1-Month USD Libor+400 basis points), 8/1/20261,2,3,4 | 982,260 | |||||
Technimark Holdings, LLC | ||||||||
12,750,000 | Second Lien Term Loan, 7.500% (3-Month USD Libor+675 basis points), 7/9/20293,4 | 12,431,250 | ||||||
2,250,000 | Second Lien Term Loan, 7.500% (3-Month USD Libor+675 basis points), 7/9/20294,5 | 2,221,875 | ||||||
Tilley Chemical Co., Inc. | ||||||||
622,222 | Revolver, 0.500%, 12/31/20262,4,5 | 616,000 | ||||||
5,333,333 | Delayed Draw, 7.000% (3-Month USD Libor+600 basis points), 12/31/20262,3,4 | 5,306,667 | ||||||
933,334 | Revolver, 7.000% (3-Month USD Libor+600 basis points), 12/31/20262,3,4,5 | 924,000 | ||||||
19,063,124 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 12/31/20262,3,4 | 18,872,493 | ||||||
25,000,000 | USALCO, LLC First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 10/19/20272,3,4 | 24,750,000 | ||||||
225,948,909 | ||||||||
REAL ESTATE — 0.9% | ||||||||
20,000,000 | Associations, Inc. First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 7/2/20273 | 19,716,000 | ||||||
CRS TH Holdings Corp | ||||||||
4,237,288 | Revolver, 0.500%, 12/1/20272,4,5 | 4,194,915 | ||||||
6,355,932 | Delayed Draw, 1.000%, 12/1/20272,4,5 | 6,324,153 | ||||||
14,406,780 | First Lien Term Loan, 5.750% (3-Month USD Libor+475 basis points), 12/1/20272,3,4 | 14,262,712 | ||||||
44,497,780 | ||||||||
TECHNOLOGY — 19.5% | ||||||||
1WorldSync, Inc. | ||||||||
145,384 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 7/8/20253,4 | 145,384 | ||||||
5,779,577 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 7/8/20252,3,4 | 5,779,577 | ||||||
5,000,000 | First Lien Term Loan, 6.750% (3-Month USD Libor+625 basis points), 7/8/20253,4 | 5,000,000 | ||||||
9,975,000 | AG-Twin Brook Technology First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 10/29/20262,3,4 | 9,825,375 | ||||||
AIDC Acquisition, LLC | ||||||||
5,892,201 | First Lien Term Loan, 4.000% (3-Month USD Libor+300 basis points), 4/1/20263,4 | 5,833,279 | ||||||
7,980,000 | First Lien Term Loan, 8.053% (3-Month USD Libor+705 basis points), 4/1/20262,3,4 | 7,880,250 | ||||||
15,000,000 | First Lien Term Loan, 8.090% (1-Month USD Libor+709 basis points), 4/1/20263,4 | 14,850,000 | ||||||
Appfire Technologies, LLC | ||||||||
13,376,571 | Delayed Draw, 1.000%, 3/9/20274,5 | 13,327,078 | ||||||
4,623,429 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 3/9/20273,4,5 | 4,606,322 | ||||||
Applied Technical Services | ||||||||
681,818 | Revolver, 0.500%, 12/29/20262,4,5 | 680,318 | ||||||
3,068,182 | Delayed Draw, 1.000%, 12/29/20264,5 | 3,068,182 | ||||||
3,409,091 | Delayed Draw, 1.000%, 12/29/20264,5 | 3,409,091 | ||||||
2,272,727 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 12/29/20262,3,4 | 2,267,727 | ||||||
227,273 | Revolver, 6.750% (3-Month USD Libor+575 basis points), 12/29/20262,3,4,5 | 226,773 |
See accompanying Notes to Consolidated Financial Statements.
28
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
TECHNOLOGY (Continued) | ||||||||
$ | 6,767,045 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 12/29/20262,3,4 | $ | 6,752,158 | ||||
340,909 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 12/29/20263,4,5 | 340,909 | ||||||
19,995,543 | Revalize, Inc. Delayed Draw, 6.250% (3-Month USD Libor+525 basis points), 4/15/20273,4 | 19,867,092 | ||||||
5,259,615 | AQA Acquisition Holding, Inc. Second Lien Term Loan, 8.000% (3-Month USD Libor+750 basis points), 3/3/20293,4 | 5,196,500 | ||||||
14,887,500 | Arcstor Midco LLC First Lien Term Loan, 8.000% (3-Month USD Libor+700 basis points), 3/16/20272,3,4 | 14,628,458 | ||||||
8,045,022 | ATP Intermediate, Inc. First Lien Term Loan, 8.725% (3-Month USD Libor+773 basis points), 6/16/20252,3,4 | 7,964,571 | ||||||
2,467,526 | AVI-SPL First Lien Term Loan, 6.375% (3-Month USD Libor+538 basis points), 3/10/20272,3,4 | 2,440,179 | ||||||
Benefit Street Technology | ||||||||
2,666,667 | Revolver, 0.500%, 10/1/20262,4,5 | 2,613,333 | ||||||
25,000,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 10/1/20272,3,4 | 24,500,000 | ||||||
Bounteous, Inc. | ||||||||
1,488,000 | Revolver, 0.500%, 8/2/20272,4,5 | 1,458,240 | ||||||
4,300,000 | Delayed Draw, 1.000%, 8/2/20274,5 | 4,257,000 | ||||||
4,500,000 | Delayed Draw, 6.000% (3-Month USD Libor+500 basis points), 8/2/20272,3,4 | 4,444,200 | ||||||
312,000 | Revolver, 6.000% (3-Month USD Libor+500 basis points), 8/2/20272,3,4,5 | 305,760 | ||||||
8,700,000 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 8/2/20272,3,4 | 8,526,000 | ||||||
2,150,000 | First Lien Term Loan, 6.000% (3-Month USD Libor+500 basis points), 8/2/20273,4 | 2,107,000 | ||||||
BusinesSolver.com, Inc. | ||||||||
1,378,788 | Delayed Draw, 1.000%, 12/1/20272,4,5 | 1,371,894 | ||||||
5,121,212 | First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 12/1/20272,3,4 | 5,070,000 | ||||||
Captify Intermediate Holdings Corp. | ||||||||
2,500,000 | Delayed Draw, 1.000%, 7/12/20264,5 | 2,481,250 | ||||||
8,728,125 | First Lien Term Loan, 9.000% (3-Month USD Libor+800 basis points), 7/12/20263 | 8,597,203 | ||||||
CEB Acquisitionco, LLC | ||||||||
2,500,000 | First Lien Term Loan, 4.750% (3-Month USD Libor+375 basis points), 12/21/20273,4 | 2,475,000 | ||||||
2,500,000 | Last Out Term Loan, 8.750% (3-Month USD Libor+575 basis points), 12/21/20273,4 | 2,437,500 | ||||||
1,950,000 | Clarus First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 7/1/20252,3,4 | 1,917,045 | ||||||
Cleo Communications Holding, LLC | ||||||||
2,140,000 | Revolver, 0.500%, 6/9/20274,5 | 2,136,362 | ||||||
12,827,850 | First Lien Term Loan, 7.750% (3-Month USD Libor+675 basis points), 6/9/20273,4,16 | 12,806,043 | ||||||
GBP | 3,613,000 | SSCP Pegasus Bidco Ltd. First Lien Term Loan, 6.915% (3-Month GBP Libor+675 basis points), 12/14/20273,4 | 4,900,143 | |||||
10,000,000 | Conservice Midco, LLC Second Lien Term Loan, 7.851% (3-Month USD Libor+775 basis points), 5/13/20283,4 | 10,000,000 | ||||||
DataLink, LLC | ||||||||
846,774 | Revolver, 0.500%, 11/20/20262,4,5 | 846,774 | ||||||
1,185,484 | Delayed Draw, 1.000%, 11/20/20262,4,5 | 1,185,484 |
See accompanying Notes to Consolidated Financial Statements.
29
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
TECHNOLOGY (Continued) | ||||||||
$ | 6,381,855 | First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 11/20/20262,3,4 | $ | 6,381,855 | ||||
12,500,000 | DCert Buyer, Inc. Second Lien Term Loan, 7.090% (1-Month USD Libor+700 basis points), 2/24/20293,4 | 12,552,063 | ||||||
Diligent Corporation | ||||||||
5,955,000 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 8/4/20253,4,15 | 5,910,338 | ||||||
4,367,000 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 8/4/20253,4,15 | 4,334,684 | ||||||
1,254,400 | Delayed Draw, 1.000%, 8/24/20254,5 | 1,245,117 | ||||||
344,736 | Delayed Draw, 6.750% (3-Month USD Libor+575 basis points), 8/24/20253,4,5 | 342,185 | ||||||
Follett School Solutions | ||||||||
920,223 | Revolver, 0.500%, 8/31/20274,5 | 901,818 | ||||||
690,167 | Revolver, 6.500% (3-Month USD Libor+575 basis points), 8/31/20273,4,5 | 676,364 | ||||||
18,389,610 | First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 8/31/20283,4,15 | 18,021,818 | ||||||
Gainsight, Inc. | ||||||||
2,625,000 | Revolver, 0.500%, 7/30/20274,5 | 2,579,063 | ||||||
15,000,000 | First Lien Term Loan, 7.000% (3-Month USD Libor+625 basis points), 7/30/20273,4,15 | 14,737,500 | ||||||
SEK | 11,250,000 | Goldcup 25952 AB First Lien Term Loan, 5.756% (3-Month SEK Stibor+575 basis points), 8/18/20273,4 | 1,231,683 | |||||
GovBrands Intermediate, Inc. | ||||||||
917,000 | Revolver, 0.500%, 4/4/20274,5 | 894,075 | ||||||
545,455 | Revolver, 0.500%, 4/4/20272,4,5 | 531,818 | ||||||
905,972 | Delayed Draw, 1.000%, 4/4/20274,5 | 886,901 | ||||||
718,182 | Delayed Draw, 1.000%, 4/4/20272,4,5 | 703,064 | ||||||
1,961,028 | Delayed Draw, 6.250% (3-Month USD Libor+550 basis points), 4/4/20273,4,5 | 1,919,749 | ||||||
8,694,210 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 4/4/20273,4,15 | 8,476,855 | ||||||
1,554,545 | Delayed Draw, 6.250% (1-Month USD Libor+550 basis points), 4/4/20272,3,4,5 | 1,521,822 | ||||||
272,727 | Revolver, 6.250% (1-Month USD Libor+550 basis points), 4/4/20272,3,4,5 | 265,909 | ||||||
6,909,091 | First Lien Term Loan, 6.250% (1-Month USD Libor+550 basis points), 4/4/20272,3,4 | 6,736,364 | ||||||
GraphPAD Software, LLC | ||||||||
4,411,765 | Delayed Draw, 1.000%, 11/29/20232,4,5 | 4,367,647 | ||||||
8,088,235 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 4/6/20292,3,4 | 8,007,353 | ||||||
Hawkeye AcquisitionCo, LLC | ||||||||
500,000 | Revolver, 0.500%, 11/19/20262,4,5 | 497,500 | ||||||
3,980,000 | Delayed Draw, 7.250% (3-Month USD Libor+625 basis points), 11/19/20262,3,4 | 3,960,100 | ||||||
5,445,000 | First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 11/19/20262,3,4 | 5,417,775 | ||||||
20,000,000 | HCSS First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 11/16/20283,4 | 19,600,000 | ||||||
Help Systems Holdings, Inc. | ||||||||
2,474,886 | First Lien Term Loan, 5.750% (3-Month USD Libor+475 basis points), 11/19/20262,3 | 2,469,479 | ||||||
10,000,000 | Second Lien Term Loan, 7.500% (3-Month USD Libor+675 basis points), 11/19/20273,4 | 10,054,000 | ||||||
1,990,000 | HotSchedules First Lien Term Loan, 7.750% (3-Month USD Libor+675 basis points), 7/9/20252,3,4 | 1,965,350 |
See accompanying Notes to Consolidated Financial Statements.
30
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
TECHNOLOGY (Continued) | ||||||||
GBP | 18,960,407 | HPS Technology First Lien Term Loan, 5.260% (3-Month GBP Libor+550 basis points), 9/30/20262,3,4 | $ | 25,022,193 | ||||
GBP | 7,523,888 | First Lien Term Loan, 6.560% (6-Month GBP Libor+625 basis points), 9/15/20272,3,4,6 | 10,183,931 | |||||
$ | 7,406,003 | HS Purchaser LLC First Lien Term Loan, 5.750% (1-Month USD Libor+475 basis points), 11/19/20261,2,3 | 7,389,821 | |||||
1,465,971 | Idera, Inc. First Lien Term Loan, 4.500% (1-Month USD Libor+350 basis points), 3/2/20281,2,3,4 | 1,467,598 | ||||||
Imagine Acquisitionco, Inc. | ||||||||
1,157,556 | Revolver, 0.500%, 11/16/20272,4,5 | 1,145,981 | ||||||
1,607,717 | Delayed Draw, 1.000%, 11/16/20272,4,5 | 1,599,678 | ||||||
7,234,727 | First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 11/16/20272,3,4 | 7,162,379 | ||||||
IG Investments | ||||||||
361,272 | Revolver, 0.500%, 9/22/20282,4,5 | 354,046 | ||||||
361,271 | Revolver, 6.750% (3-Month USD Libor+600 basis points), 9/22/20282,3,4,5 | 354,046 | ||||||
9,277,457 | First Lien Term Loan, 6.750% (3-Month USD Libor+600 basis points), 9/22/20282,3,4 | 9,091,908 | ||||||
insightsoftware | ||||||||
366,345 | Revolver, 0.500%, 5/24/20244,5 | 364,696 | ||||||
331,455 | Revolver, 5.750% (3-Month USD Libor+475 basis points), 5/24/20243,4,5 | 329,964 | ||||||
22,540,616 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 5/24/20243,4,15,16 | 22,439,184 | ||||||
4,661,000 | Delayed Draw, 1.000%, 12/2/20264,5 | 4,649,348 | ||||||
972,431 | Intermedia Holdings, Inc. First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 7/19/20251,2,3,4 | 955,413 | ||||||
7,000,000 | Ivanti Software, Inc. Second Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 12/1/20282,3,4 | 6,783,700 | ||||||
Jigsaw Bidco AS | ||||||||
NOK | 139,882 | First Lien Term Loan, 0.000%, 5/3/20244,5,17 | 15,673 | |||||
NOK | 13,269,468 | First Lien Term Loan, 7.830% (3-Month NOK Nibor+725 basis points), 5/3/20243,4,5,17 | 1,486,812 | |||||
Kona Buyer, LLC | ||||||||
9,527,273 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 12/11/20272,3,4 | 9,527,273 | ||||||
10,000,000 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 12/11/20273,4 | 10,000,000 | ||||||
LMG Holdings, Inc. | ||||||||
285,714 | Revolver, 0.500%, 4/30/20262,4,5 | 282,857 | ||||||
4,690,714 | First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 4/30/20262,3,4 | 4,643,807 | ||||||
19,500,000 | Mandolin Technology Intermediate Holdings, Inc. Second Lien Term Loan, 7.000% (3-Month USD Libor+650 basis points), 7/30/20293,4 | 19,402,500 | ||||||
Marlin DTC-LS Midco 2, LLC | ||||||||
17,325,000 | First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 7/1/20252,3,4 | 17,032,208 | ||||||
2,992,500 | First Lien Term Loan, 7.500% (3-Month USD Libor+650 basis points), 7/1/20253,4 | 2,941,927 | ||||||
SEK | 11,346,704 | Mefla 3 AB First Lien Term Loan, 9.000% PIK (3-Month SEK Stibor+800 basis points), 9/1/20233,4,5,17 | 1,238,265 |
See accompanying Notes to Consolidated Financial Statements.
31
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
TECHNOLOGY (Continued) | ||||||||
GBP | 221,570 | Mefla UK Limited First Lien Term Loan, 9.000% PIK (3-Month GBP Libor+800 basis points), 9/1/20233,4,5,17 | $ | 295,743 | ||||
GBP | 3,024 | First Lien Term Loan, 0.000%, 9/1/20234,5 | 4,036 | |||||
SEK | 156,822 | First Lien Term Loan, 0.000%, 9/1/20234,5 | 17,114 | |||||
$ | 21,000,000 | Merlin International, Inc. First Lien Term Loan, 10.000% (3-Month USD Libor+700 basis points), 8/6/20233,4 | 20,160,000 | |||||
Ministry Brands Merger Sub, LLC | ||||||||
1,694,915 | Revolver, 0.500%, 12/27/20274,5 | 1,661,017 | ||||||
5,649,718 | Delayed Draw, 1.000%, 12/27/20284,5 | 5,593,220 | ||||||
17,655,367 | First Lien Term Loan, 6.250% (3-Month USD Libor+550 basis points), 12/27/20283,4 | 17,302,260 | ||||||
16,557,353 | Motus, LLC Second Lien Term Loan, 7.250% (3-Month USD Libor+650 basis points), 12/10/20293,4 | 16,391,779 | ||||||
487,406 | NAVEX TopCo, Inc. First Lien Term Loan, 3.350% (3-Month USD Libor+325 basis points), 9/5/20251,2,3,4 | 484,513 | ||||||
New Era Technology | ||||||||
152,022 | Revolver, 0.500%, 10/31/20262,4,5 | 152,706 | ||||||
672,697 | Delayed Draw, 1.000%, 10/31/20262,4,5 | 675,724 | ||||||
3,157,590 | First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 10/31/20262,3,4 | 3,171,799 | ||||||
1,354,372 | Delayed Draw, 7.250% (3-Month USD Libor+625 basis points), 10/31/20262,3,4,5 | 1,360,467 | ||||||
76,011 | Revolver, 7.250% (3-Month USD Libor+625 basis points), 10/31/20262,3,4,5 | 76,353 | ||||||
10,000,000 | Options Technology Ltd. First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 12/26/20253,4 | 9,800,000 | ||||||
PCS Software, Inc. | ||||||||
363,714 | Revolver, 7.250% (3-Month USD Libor+575 basis points), 7/1/20243,4 | 363,714 | ||||||
4,912,500 | First Lien Term Loan, 7.250% (3-Month USD Libor+575 basis points), 7/1/20243,4 | 4,912,500 | ||||||
9,939,086 | PDI TA Holdings, Inc. First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 10/24/20243,4 | 9,790,000 | ||||||
PDQ | ||||||||
1,764,706 | Revolver, 0.500%, 8/27/20274,5 | 1,733,824 | ||||||
7,395,882 | Delayed Draw, 6.000% (3-Month USD Libor+550 basis points), 8/27/20273,4 | 7,266,454 | ||||||
10,796,471 | First Lien Term Loan, 6.000% (3-Month USD Libor+550 basis points), 8/27/20273,4,15 | 10,607,532 | ||||||
Pegasus Global Enterprise Holdings, LLC | ||||||||
1,944,167 | Delayed Draw, 0.500%, 5/29/20252,4,5 | 1,929,586 | ||||||
101,301 | Delayed Draw, 7.250% (3-Month USD Libor+625 basis points), 5/29/20252,3,4,5 | 100,541 | ||||||
2,761,863 | First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 5/29/20252,3,4 | 2,741,149 | ||||||
ProcessUnity Holdings, LLC | ||||||||
1,000,000 | Revolver, 0.500%, 9/24/20284,5 | 980,000 | ||||||
1,000,000 | Delayed Draw, 1.000%, 9/24/20284,5 | 990,000 | ||||||
5,000,000 | First Lien Term Loan, 6.750% (3-Month USD Libor+600 basis points), 9/24/20283,4 | 4,900,000 |
See accompanying Notes to Consolidated Financial Statements.
32
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
TECHNOLOGY (Continued) | ||||||||
$ | 4,936,387 | Q-Centrix LLC First Lien Term Loan, 5.500% (3-Month USD Libor+450 basis points), 11/30/20242,3,4 | $ | 4,936,387 | ||||
Quantic Electronics, LLC | ||||||||
428,397 | Revolver, 0.500%, 11/19/20264,5 | 426,255 | ||||||
1,419,994 | Delayed Draw, 1.000%, 11/19/20264,5 | 1,412,894 | ||||||
1,997,149 | Delayed Draw, 7.250% (3-Month USD Libor+625 basis points), 11/19/20263,4,5 | 1,987,163 | ||||||
3,682,420 | First Lien Term Loan, 7.250% (3-Month USD Libor+625 basis points), 11/19/20263,4 | 3,664,008 | ||||||
Questel International | ||||||||
EUR | 2,153,391 | First Lien Term Loan, 6.250% (3-Month EUR Libor+525 basis points), 12/17/20272,3,4 | 2,441,687 | |||||
EUR | 8,850,000 | First Lien Term Loan, 6.250% (3-Month EUR Libor+525 basis points), 12/17/20273,4 | 10,034,836 | |||||
Ranger Buyer, Inc. | ||||||||
1,538,462 | Revolver, 0.500%, 11/18/20274,5 | 1,523,077 | ||||||
384,615 | Revolver, 7.000% (3-Month USD Libor+625 basis points), 11/18/20273,4,5 | 380,769 | ||||||
23,076,923 | First Lien Term Loan, 7.000% (3-Month USD Libor+625 basis points), 11/18/20283,4,16 | 22,846,154 | ||||||
2,219,979 | RCS Technology First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 2/28/20253,4,6 | 2,219,979 | ||||||
Revalize, Inc. | ||||||||
681,000 | Revolver, 0.500%, 4/15/20274,5 | 674,190 | ||||||
709,375 | Revolver, 0.500%, 4/15/20272,4,5 | 702,281 | ||||||
6,808,000 | Delayed Draw, 1.000%, 4/15/20274,5 | 6,773,960 | ||||||
7,092,188 | Delayed Draw, 1.000%, 4/15/20272,4,5 | 7,056,727 | ||||||
4,511,000 | Delayed Draw, 6.250% (3-Month USD Libor+525 basis points), 4/15/20273,4 | 4,465,890 | ||||||
4,698,438 | Delayed Draw, 6.250% (3-Month USD Libor+525 basis points), 4/15/20272,3,4 | 4,651,453 | ||||||
972,431 | RevSpring, Inc. First Lien Term Loan, 4.382% (3-Month USD Libor+425 basis points), 10/11/20251,2,3,4 | 970,593 | ||||||
GBP | 10,996,000 | ERG Bidco, Ltd. First Lien Term Loan, 6.801% (3-Month GBP Libor+675 basis points), 6/25/20283,4 | 14,474,296 | |||||
RPX Corporation | ||||||||
4,612,500 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 10/23/20252,3,4 | 4,508,719 | ||||||
8,000,000 | First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 10/23/20253,4 | 7,820,000 | ||||||
441,586 | S2P Acquisition Borrower, Inc. First Lien Term Loan, 4.104% (3-Month USD Libor+400 basis points), 8/14/20261,2,3,4 | 441,942 | ||||||
Safety Borrower Holdings | ||||||||
677,966 | Revolver, 0.500%, 9/1/20272,4,5 | 671,186 | ||||||
1,694,915 | Delayed Draw, 1.000%, 9/1/20272,4,5 | 1,686,441 | ||||||
7,627,119 | First Lien Term Loan, 6.750% (3-Month USD Libor+575 basis points), 9/1/20272,3,4 | 7,550,847 |
See accompanying Notes to Consolidated Financial Statements.
33
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Principal | Value | |||||||
SENIOR SECURED LOANS (Continued) | ||||||||
TECHNOLOGY (Continued) | ||||||||
Sherlock Buyer Corp. | ||||||||
$ | 821,100 | Revolver, 0.500%, 12/8/20272,4,5 | $ | 804,678 | ||||
2,052,750 | Delayed Draw, 1.000%, 12/8/20282,4,5 | 2,032,223 | ||||||
7,116,200 | First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 12/8/20282,3,4 | 6,973,876 | ||||||
5,600,000 | SitusAMC Holdings Corporation First Lien Term Loan, 6.500% (3-Month USD Libor+575 basis points), 12/22/20272,3 | 5,544,000 | ||||||
1,473,750 | Smartlinx Solutions, LLC First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 3/5/20263,4 | 1,456,285 | ||||||
13,000,000 | Solera Global Holdings Second Lien Term Loan, 9.000% (3-Month USD Libor+800 basis points), 6/4/20293,4 | 12,610,533 | ||||||
Syntax Systems Ltd. | ||||||||
1,114,191 | Revolver, 0.500%, 10/29/20262,4,5 | 1,103,050 | ||||||
866,007 | Revolver, 6.250% (1-Month USD Libor+550 basis points), 10/29/20262,3,4,5 | 857,346 | ||||||
5,000,000 | First Lien Term Loan, 6.250% (1-Month USD Libor+550 basis points), 10/28/20283,4 | 4,950,000 | ||||||
4,950,495 | Delayed Draw, 1.000%, 10/29/20282,4,5 | 4,900,990 | ||||||
18,024,134 | First Lien Term Loan, 6.250% (1-Month USD Libor+550 basis points), 10/29/20282,3,4 | 17,843,892 | ||||||
1,485,000 | TaxSlayer First Lien Term Loan, 7.000% (3-Month USD Libor+600 basis points), 12/31/20262,3,4 | 1,468,223 | ||||||
15,000,000 | Twin Brook Technology First Lien Term Loan, 6.500% (3-Month USD Libor+550 basis points), 10/5/20272,3,4 | 14,850,000 | ||||||
GBP | 12,230,216 | UKFast Leaders Limited First Lien Term Loan, 6.918% (3-Month GBP Libor+675 basis points), 9/8/20272,3,4 | 16,438,284 | |||||
Uniguest | ||||||||
526,316 | Revolver, 0.500%, 12/17/20252,4,5 | 526,316 | ||||||
1,592,105 | Delayed Draw, 1.000%, 12/17/20252,4,5 | 1,592,105 | ||||||
2,609,020 | Delayed Draw, 8.000% (1-Month USD Libor+700 basis points), 12/17/20252,3,4,5 | 2,609,020 | ||||||
5,210,526 | First Lien Term Loan, 8.000% (1-Month USD Libor+700 basis points), 12/17/20252,3,4 | 5,210,526 | ||||||
15,000,000 | Virgin Pulse, Inc. Second Lien Term Loan, 8.000% (3-Month USD Libor+725 basis points), 4/6/20293,4 | 14,887,500 | ||||||
14,223,733 | Afiniti, Inc. First Lien Term Loan, 11.750% (3-Month USD Libor+1,125 basis points), 6/13/20242,3,4,17 | 14,207,092 | ||||||
2,431,250 | Worksoft First Lien Term Loan, 8.750% (3-Month USD Libor+775 basis points), 2/22/20253,4 | 2,400,271 | ||||||
922,630,886 | ||||||||
UTILITIES — 0.4% | ||||||||
2,878,076 | TS OpCo Holding LLC First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 9/28/20232,3,4 | 2,860,807 | ||||||
Water Holdings Acquisition, LLC | ||||||||
872,877 | Revolver, 0.500%, 12/18/20262,4,5 | 855,419 | ||||||
412,837 | Revolver, 6.250% (3-Month USD Libor+525 basis points), 12/18/20262,3,4,5 | 404,581 | ||||||
13,714,286 | First Lien Term Loan, 6.250% (3-Month USD Libor+525 basis points), 12/18/20262,3,4 | 13,440,000 | ||||||
17,560,807 | ||||||||
TOTAL SENIOR SECURED LOANS | ||||||||
(Cost $4,648,724,420) | 4,654,593,048 |
See accompanying Notes to Consolidated Financial Statements.
34
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Number of | Value | |||||||
PRIVATE INVESTMENT VEHICLES — 41.2% | ||||||||
INVESTMENT PARTNERSHIPS — 7.1% | ||||||||
N/A | AG Direct Lending Fund II L.P.2,10 | $ | 18,915,997 | |||||
N/A | AG Direct Lending Fund III L.P.2,10 | 20,335,682 | ||||||
N/A | Annaly Credit Opportunities Onshore Fund, LP2,10 | 51,144,216 | ||||||
N/A | Ares Commercial Finance Feeder (A) LP10 | 13,135,522 | ||||||
N/A | BARINGS CMS FUND LP10 | 15,000,000 | ||||||
N/A | Crescent Mezzanine Partners VIIC, L.P.10 | 6,376,274 | ||||||
N/A | Crestline Specialty Lending III (U.S.), LP2,10 | 6,883,019 | ||||||
N/A | HPS Mezzanine Partners 2019 LP10 | 9,355,616 | ||||||
N/A | HPS Specialty Loan Fund V Feeder LP10 | 42,977,780 | ||||||
N/A | Marlin Credit Opportunity Fund LP2,10 | 50,838,238 | ||||||
N/A | Providence Debt Fund III (Non-US) L.P.10 | 3,916,335 | ||||||
N/A | Raven Asset Based Credit Fund II, LP2,10 | 5,074,346 | ||||||
N/A | Silver Point Specialty Credit Fund II, LP10 | 35,275,861 | ||||||
N/A | Thompson Rivers, LLC10 | 20,564,423 | ||||||
N/A | Varagon Capital Direct Lending Fund10 | 10,201,688 | ||||||
N/A | Vista Credit Partner Fund III LP2,10 | 16,609,395 | ||||||
N/A | Waccamaw River, LLC10 | 6,896,297 | ||||||
333,500,689 | ||||||||
JOINT VENTURES — 2.0% | ||||||||
N/A | FBLC Senior Loan Fund LLC10 | 81,621,414 | ||||||
N/A | Middle Market Credit Fund II, LLC10 | 15,273,674 | ||||||
96,895,088 | ||||||||
NON-LISTED BUSINESS DEVELOPMENT COMPANIES — 22.1% | ||||||||
3,460,444 | Barings Capital Investment Corporation2,10 | 76,926,005 | ||||||
34,693,370 | Barings Private Credit Corporation10,14 | 708,635,237 | ||||||
5,892,548 | Franklin BSP Lending Corporation2,10 | 44,754,531 | ||||||
766,667 | Golub Capital Direct Lending Corp.10,14 | 11,508,435 | ||||||
1,450,326 | Morgan Stanley Direct Lending Fund10 | 33,875,734 | ||||||
8,000,000 | New Mountain Guardian III BDC, LLC2,10 | 81,281,656 | ||||||
5,376,344 | Owl Rock Core Income Corp.10 | 50,088,711 | ||||||
2,119,509 | Owl Rock Technology Finance Corp.10 | 38,669,900 | ||||||
64,286 | Owl Rock Technology Finance Corp. II10 | 964,289 | ||||||
1,046,704,498 | ||||||||
PRIVATE COLLATERALIZED LOAN OBLIGATION — 9.2% | ||||||||
N/A | BlackRock Shasta CLO VII10 | 256,096,120 | ||||||
N/A | Varagon Structured Note Issuer I LLC2,10 | 176,280,548 | ||||||
432,376,668 | ||||||||
PRIVATE EQUITY — 0.0% | ||||||||
1 | Owl Rock Capital Technology Holdings II LLC4 | 1,857,735 | ||||||
See accompanying Notes to Consolidated Financial Statements.
35
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Number of | Value | |||||||
PRIVATE INVESTMENT VEHICLES (Continued) | ||||||||
SPECIAL PURPOSE VEHICLE FOR SENIOR SECURED BONDS — 0.8% | ||||||||
N/A | 17Capital Co-Invest (B) SCSp10 | $ | 24,986,888 | |||||
N/A | Endurance II L.P.10 | 10,083,487 | ||||||
N/A | Proxima Onshore Co-Invest, L.P.10 | 586,234 | ||||||
35,656,609 | ||||||||
TOTAL PRIVATE INVESTMENT VEHICLES | ||||||||
(Cost $1,892,929,463) | 1,946,991,287 | |||||||
Principal | ||||||||
COLLATERALIZED LOAN OBLIGATIONS — 2.1% | ||||||||
$ | 12,000,000 | ABPCI Direct Lending Fund CLO X LP 10.601% (3-Month USD Libor+1,047 basis points), 1/20/20321,3,7 | 12,025,200 | |||||
BlackRock Elbert CLO V Ltd. | ||||||||
39,500,000 | 6.690%, 12/15/2031*1,7,11 | 40,308,249 | ||||||
11,000,000 | 9.603% (3-Month USD Libor+940 basis points), 12/15/20311,3,7 | 11,079,534 | ||||||
10,000,000 | Monroe Capital MML CLO IX Ltd. 8.828% (3-Month USD Libor+870 basis points), 10/22/20311,3,7,12 | 10,050,574 | ||||||
2,910,000 | Monroe Capital MML CLO VII Ltd. 7.410% (3-Month USD Libor+725 basis points), 11/22/20301,3,7 | 2,893,730 | ||||||
15,000,000 | Monroe Capital MML CLO VIII, Ltd. 14.000%, 11/22/2033*,1,4,7,11 | 12,993,000 | ||||||
Monroe Capital MML CLO X Ltd. | ||||||||
5,000,000 | 7.060% (3-Month USD Libor+690 basis points), 8/20/20311,3,4,7,12 | 5,052,328 | ||||||
3,000,000 | 9.010% (3-Month USD Libor+885 basis points), 8/20/20311,3,7 | 2,999,603 | ||||||
TOTAL COLLATERALIZED LOAN OBLIGATIONS | ||||||||
(Cost $96,089,932) | 97,402,218 | |||||||
Number of | ||||||||
PREFERRED STOCKS — 0.7% | ||||||||
HEALTH CARE — 0.5% | ||||||||
5,000 | FINThrive Software Preferred Intermediate Holdings, Inc., Series A-2 Preferred, 11.000%4 | 4,850,000 | ||||||
17,500 | ProPharma Group, LLC: Jayhawk Intermediate LLC, Series B Preferred, 13.000%2,4,19 | 16,979,640 | ||||||
21,829,640 | ||||||||
INDUSTRIALS — 0.1% | ||||||||
2,500 | Atomic Transport, LLC Atomic Blocker, LLC, Class A Preferred, 8.500% PIK4,20 | 1,798,139 | ||||||
200 | S4T Holdings Corp. Vistria ESS Holdings, LLC, Class A Preferred, 8.000%4,21 | 100,000 | ||||||
1,898,139 |
See accompanying Notes to Consolidated Financial Statements.
36
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Number of | Value | |||||||
PREFERRED STOCKS (Continued) | ||||||||
TECHNOLOGY — 0.1% | ||||||||
6,500 | Mandolin Technology Holdings, Inc., Series A-1, A-2, A-3 Preferred, 10.500%4 | $ | 6,305,000 | |||||
TOTAL PREFERRED STOCKS | ||||||||
(Cost $30,013,004) | 30,032,779 | |||||||
Principal | ||||||||
SUBORDINATED DEBT — 0.3% | ||||||||
FINANCIALS — 0.3% | ||||||||
$ | 5,500,000 | OTR Midco, LLC, 12.000%, 5/12/20264 | 5,500,000 | |||||
10,000,000 | LUNA SUB 2 LLC, 9.000%, 12/31/20284 | 9,950,000 | ||||||
15,450,000 | ||||||||
TOTAL SUBORDINATED DEBT | ||||||||
(Cost $15,450,000) | 15,450,000 | |||||||
Number of | ||||||||
COMMON STOCKS — 0.1% | ||||||||
FINANCIALS — 0.1% | ||||||||
280,309 | Congressional Bancshares Inc., Voting Common4 | 4,328,128 | ||||||
INDUSTRIALS — 0.0% | ||||||||
2,188 | Atomic Transport, LLC Atomic Blocker, LLC, Class W Common4,20 | 653,096 | ||||||
200 | S4T Holdings Corp. Vistria ESS Holdings, LLC, Class A Common4,21 | 100,000 | ||||||
753,096 | ||||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $4,365,607) | 5,081,224 | |||||||
Number of | ||||||||
WARRANTS — 0.0% | ||||||||
TECHNOLOGY — 0.0% | ||||||||
21,640 | Afiniti, Inc. (via a participation with VHG Investment Fund I, L.P.)2,4 | 1,152,261 | ||||||
TOTAL WARRANTS | ||||||||
(Cost $1,152,261) | 1,152,261 | |||||||
See accompanying Notes to Consolidated Financial Statements.
37
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Number of | Value | |||||||
SHORT-TERM INVESTMENTS — 1.2% | ||||||||
55,878,712 | State Street Institutional U.S. Government Money Market Fund, 0.02%13 | $ | 55,878,712 | |||||
TOTAL SHORT-TERM INVESTMENTS | ||||||||
(Cost $55,878,712) | 55,878,712 | |||||||
TOTAL INVESTMENTS — 144.0% | ||||||||
(Cost $6,744,603,399) | 6,806,581,529 | |||||||
Liabilities Less Other Assets — (44.0)% | (2,076,933,161 | ) | ||||||
NET ASSETS — 100.0% | 4,729,648,368 | |||||||
Principal | ||||||||
REVERSE REPURCHASE AGREEMENTS — (0.1)% | ||||||||
$ | (4,320,000 | ) | Agreement with Deutsche Bank AG, 1.664%, dated 12/22/2021, to be repurchased at $4,337,974 on 3/22/2022, collateralized by Monroe Capital MML CLO IX Ltd. with maturity of to 10/22/2031, with a total value of $10,050,574 | (4,320,000 | ) | |||
(2,513,000 | ) | Agreement with Deutsche Bank AG, 1.468%, dated 12/29/2021, to be repurchased at $2,522,222 on 3/29/2022, collateralized by Monroe Capital MML CLO X Ltd. with maturity of to 8/20/2031, with a total value of $5,052,328 | (2,513,000 | ) | ||||
TOTAL REVERSE REPURCHASE AGREEMENTS | ||||||||
(Proceeds $6,833,000) | (6,833,000 | ) |
LLC – Limited Liability Company
LP – Limited Partnership
US – United States
LOC – Letter of Credit
BDC – Business Development Company
CAD – Canadian Dollars
EUR – Euro
GBP – Pound Sterling
NOK – Norwegian Krone
SEK – Swedish Krona
Libor – London Interbank Offered Rate
Stibor – Stockholm Interbank Offered Rate
Nibor – Norwegian Interbank Offered Rate
* | Subordinated note position. Rate shown is the effective yield as of period end. |
1 | Callable. |
2 | As of December 31, 2021 all or a portion of the security has been pledged as collateral for a secured revolving facility. The market value of the securities in the pledged account totaled $3,055,911,453 as of December 31, 2021. See Note 2, subsection Borrowing, Use of Leverage of the Notes to Consolidated Financial Statements for additional information. |
3 | Floating rate security. Rate shown is the rate effective as of period end. |
4 | Value was determined using significant unobservable inputs. |
See accompanying Notes to Consolidated Financial Statements.
38
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
5 | All or a portion of this holding is subject to unfunded loan commitments. See Note 2 for additional information. |
6 | This investment was made through a participation. Please see Note 2 for a description of loan participations. |
7 | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities are restricted. They may only be resold in transactions exempt from registration normally to qualified institutional buyers. The total value of these securities is $97,402,218, which represents 2.1% of total net assets of the Fund. |
8 | Step rate security. |
9 | Foreign securities entered into in foreign currencies are converted to U.S. Dollars using period end spot rates. |
10 | Investment valued using net asset value per share as practical expedient. See Note 13 for respective investment strategies, unfunded commitments, and redemptive restrictions. |
11 | Variable rate security. Rate shown is the rate in effect as of period end. |
12 | All or a portion of this security is segregated as collateral for reverse repurchase agreements. Total collateral had a fair value of $15,102,902 as of December 31, 2021. See note 2 for additional information. |
13 | The rate is the annualized seven-day yield at period end. |
14 | Was an affiliate, as defined by the Investment Company Act of 1940, at or during the fiscal year ended December 31, 2021, by virtue of the Fund owning at least 5% of the voting securities of the issuer. See Note 12 for additional information. |
15 | All or a portion of this security is segregated as collateral for Secured borrowings made with Macquarie US Trading LLC. Total collateral had a fair value of $102,503,317 as of December 31, 2021. See note 2 for additional information. |
16 | All or a portion of this security is segregated as collateral for Secured borrowings made with Macquarie US Trading LLC. Total collateral had a fair value of $147,486,913 as of December 31, 2021. See note 2 for additional information. |
17 | Principal includes accumulated payment in kind (“PIK”) interest and is net of repayments, if any. |
18 | Variable rate security. Rate shown is the rate in effect as of period end. |
19 | Jayhawk Intermediate, LLC is the holding company that owns ProPharma Group, LLC. |
20 | Atomic Blocker, LLC holds Class A Preferred and Class W Common Units in Atomic Holdings, LLC, which is the holding company that owns Atomic Transport, LLC. |
21 | Vistria ESS Holdings, LLC holds Series A Preferred Units and Class A Common Units in TVG ESS Holdings, LLC which is the parent company holdings company for S4T Holdings Corp. |
Additional information on restricted securities is as follows:
Security | First | Cost | ||||||
17Capital Co. Investment Fund V-L LP | 9/23/2021 | $ | 25,759,098 | |||||
AG Direct Lending Fund II L.P. | 3/31/2020 | 17,916,043 | ||||||
AG Direct Lending Fund III L.P | 6/28/2019 | 18,102,555 | ||||||
Annaly Credit Opportunities Onshore Fund LP | 4/16/2021 | 51,135,450 | ||||||
Ares Commercial Finance Feeder (A) LP | 3/31/2021 | 11,309,134 | ||||||
Barings Capital Investment Corporation | 1/25/2021 | 76,000,000 | ||||||
Barings CMS Fund LP | 12/28/2021 | 15,000,000 | ||||||
Barings Private Credit Corporation | 5/10/2021 | 700,000,000 | ||||||
FBLC Senior Loan Fund LLC | 1/20/2021 | 78,562,200 | ||||||
BlackRock Shasta CLO VII | 2/10/2021 | 251,162,791 | ||||||
Franklin BSP Lending Corporation | 4/1/2020 | 34,000,000 | ||||||
Crescent Mezzanine Partners VIIC, L.P. | 3/31/2021 | 5,540,346 | ||||||
Crestline Specialty Lending III (U.S), L.P. | 8/30/2021 | 6,672,081 | ||||||
Endurance II L.P. | 8/24/2020 | 9,725,000 | ||||||
Golub Capital Direct Lending Corp. | 7/13/2021 | 11,500,000 |
See accompanying Notes to Consolidated Financial Statements.
39
Cliffwater Corporate Lending Fund
Consolidated Schedule of Investments
As of December 31, 2021 (Continued)
Security | First | Cost | ||||||
HPS Mezzanine Partners 2019 LP | 11/16/2020 | $ | 8,340,651 | |||||
HPS Specialty Loan Fund V Feeder LP | 5/14/2021 | 40,483,748 | ||||||
Marlin Credit Opportunity Fund LP | 5/21/2021 | 50,423,715 | ||||||
Middle Market Credit Fund II, LLC | 11/3/2020 | 12,708,191 | ||||||
Morgan Stanley Direct Lending Fund | 7/16/2021 | 33,289,217 | ||||||
New Mountain Guardian III BDC, LLC | 3/27/2020 | 80,000,000 | ||||||
Owl Rock Core Income Corp. | 7/29/2021 | 50,000,000 | ||||||
Owl Rock Technology Finance Corp. | 9/24/2020 | 35,000,000 | ||||||
Owl Rock Technology Finance Corp. II | 12/30/2021 | 964,289 | ||||||
Providence Debt Fund III (Non-US) L.P. | 3/31/2021 | 2,692,390 | ||||||
Proxima Onshore Co-Invest, L.P. | 11/2/2021 | 578,571 | ||||||
Raven Asset Fund II V LP | 9/21/2021 | 4,993,994 | ||||||
Silver Point Specialty Credit Fund II, L.P | 12/15/2020 | 33,835,151 | ||||||
Thompson Rivers, LLC | 6/29/2021 | 20,000,000 | ||||||
Varagon Capital Direct Lending | 3/25/2021 | 10,000,000 | ||||||
Varagon Structured Note Issuer I LLC | 10/13/2021 | 175,000,000 | ||||||
Vista Credit Partner Fund III LP | 9/15/2021 | 15,356,985 | ||||||
Waccamaw River LLC, LP | 5/4/2021 | 6,878,065 |
See accompanying Notes to Consolidated Financial Statements.
40
Cliffwater Corporate Lending Fund
Consolidated Schedule of Forward Foreign Currency Exchange Contracts
As of December 31, 2021
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
Currency Sold | Counterparty | Currency | Settlement | Currency | Value at | Value at | Unrealized | ||||||||||||
Canadian Dollars | State Street | USD | February 18, 2022 | (24,780,650 | ) | $ | (19,732,095 | ) | $ | (19,588,574 | ) | $ | 143,521 | ||||||
Canadian Dollars | State Street | USD | March 31, 2022 | (15,384,490 | ) | (12,002,910 | ) | (12,159,326 | ) | (156,416 | ) | ||||||||
Euro | State Street | USD | February 09, 2022 | (3,608,434 | ) | (4,238,579 | ) | (4,111,364 | ) | 127,215 | |||||||||
Euro | State Street | USD | February 28, 2022 | (11,643,531 | ) | (13,204,696 | ) | (13,271,580 | ) | (66,884 | ) | ||||||||
Euro | State Street | USD | March 31, 2022 | (99,691,318 | ) | (112,882,071 | ) | (113,717,197 | ) | (835,126 | ) | ||||||||
British Pound | State Street | USD | February 03, 2022 | (3,699,549 | ) | (4,887,086 | ) | (5,006,781 | ) | (119,695 | ) | ||||||||
British Pound | State Street | USD | February 04, 2022 | (862,780 | ) | (1,179,558 | ) | (1,167,638 | ) | 11,920 | |||||||||
British Pound | State Street | USD | February 09, 2022 | (14,329,969 | ) | (19,560,193 | ) | (19,392,951 | ) | 167,242 | |||||||||
British Pound | State Street | USD | March 15, 2022 | (7,508,806 | ) | (9,936,778 | ) | (10,160,124 | ) | (223,346 | ) | ||||||||
British Pound | State Street | USD | March 31, 2022 | (38,151,362 | ) | (51,202,943 | ) | (51,618,674 | ) | (415,731 | ) | ||||||||
British Pound | State Street | USD | May 04, 2022 | (1,974,937 | ) | (2,674,025 | ) | (2,671,027 | ) | 2,998 | |||||||||
British Pound | State Street | USD | May 10, 2022 | (1,735,919 | ) | (2,330,650 | ) | (2,347,673 | ) | (17,023 | ) | ||||||||
British Pound | Marlin Credit Opportunities | USD | August 11, 2022 | (218,601 | ) | (286,979 | ) | (295,460 | ) | (8,481 | ) | ||||||||
Norwegian Krone | Marlin Credit Opportunities | USD | August 11, 2023 | (13,125,000 | ) | (1,451,399 | ) | (1,474,039 | ) | (22,640 | ) | ||||||||
Swedish Krona | Marlin Credit Opportunities | USD | August 11, 2022 | (11,192,758 | ) | (1,290,603 | ) | (1,241,572 | ) | 49,031 | |||||||||
Swedish Krona | Marlin Credit Opportunities | USD | August 23, 2024 | (11,250,000 | ) | (1,279,529 | ) | (1,257,784 | ) | 21,745 | |||||||||
TOTAL FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS | $ | (258,140,094 | ) | $ | (259,481,764 | ) | $ | (1,341,670 | ) |
USD – U.S. Dollar
See accompanying Notes to Consolidated Financial Statements.
41
Cliffwater Corporate Lending Fund
Consolidated Summary of Investments
As of December 31, 2021
Security Type/Sector | Percent of Total | |||
Senior Secured Loans | ||||
Industrials | 24.2 | % | ||
Technology | 19.5 | % | ||
Health Care | 17.1 | % | ||
Financials | 13.7 | % | ||
Consumer Discretionary | 10.3 | % | ||
Communications | 4.9 | % | ||
Materials | 4.8 | % | ||
Consumer Staples | 2.0 | % | ||
Real Estate | 0.9 | % | ||
Governments | 0.6 | % | ||
Utilities | 0.4 | % | ||
Energy | 0.0 | % | ||
Total Senior Secured Loans | 98.4 | % | ||
Private Investment Vehicles | ||||
Non-Listed Business Development Companies | 22.1 | % | ||
Private Collateralized Loan Obligation | 9.2 | % | ||
Investment Partnerships | 7.1 | % | ||
Joint Ventures | 2.0 | % | ||
Special Purpose Vehicle for Senior Secured Loans | 0.8 | % | ||
Total Private Investment Vehicles | 41.2 | % | ||
Collateralized Loan Obligations | 2.1 | % | ||
Preferred Stocks | ||||
Health Care | 0.5 | % | ||
Technology | 0.1 | % | ||
Industrials | 0.1 | % | ||
Total Preferred Stocks | 0.7 | % | ||
Subordinated Debt | ||||
Financials | 0.3 | % | ||
Common Stocks | ||||
Financials | 0.1 | % | ||
Industrials | 0.0 | % | ||
Total Common Stocks | 0.1 | % | ||
Warrants | ||||
Technology | 0.0 | % | ||
Short-Term Investments | 1.2 | % | ||
Total Investments | 144.0 | % | ||
Liabilities in Excess of Other Assets | (44.0 | )% | ||
Total Net Assets | 100.0 | % |
See accompanying Notes to Consolidated Financial Statements.
42
Cliffwater Corporate Lending Fund
Consolidated Statement of Assets and Liabilities
December 31, 2021
Assets: | ||||
Investments in unaffiliated securities, at value (cost $5,941,833,208) | $ | 5,989,542,769 | ||
Investments in affiliated securities, at value (cost $711,500,000) | 720,143,672 | |||
Joint ventures, at value (cost $91,270,191) | 96,895,088 | |||
Foreign currency, at value (cost $11,775,878) | 11,848,649 | |||
Cash | 1,295,335 | |||
Cash deposited with brokers for reverse repurchase agreements | 2,513,000 | |||
Receivables: | ||||
Investment securities sold | 33,882,901 | |||
Fund shares sold | 59,417,887 | |||
Dividends and interest | 35,772,125 | |||
Prepaid expenses | 809,273 | |||
Prepaid commitment fees on secured revolving credit facility | 9,385,309 | |||
Total assets | 6,961,506,008 | |||
Liabilities: | ||||
Reverse repurchase agreements, at value (proceeds $6,833,000) | 6,833,000 | |||
Net unrealized depreciation on forward foreign currency exchange contracts | 1,341,670 | |||
Secured borrowings (Note 2) | 249,990,230 | |||
Payables: | ||||
Secured revolving credit facility (Note 2) | 1,195,000,000 | |||
Unfunded loan commitments (Note 2) | 774,351,825 | |||
Investment securities purchased | 102,991 | |||
Interest on secured revolving credit facility | 1,286,203 | |||
Interest on reverse repurchase agreements and secured borrowings | 772,831 | |||
Investment Management fees | 631,564 | |||
Sub-Advisory fees | 245,914 | |||
Audit fees | 121,777 | |||
Fund administration fees | 582,352 | |||
Legal fees | 74,917 | |||
Custody fees | 271,108 | |||
Transfer Agency fees and expenses | 101,048 | |||
Chief Compliance Officer fees | 11,350 | |||
Other accrued expenses | 138,860 | |||
Total liabilities | 2,231,857,640 | |||
Net Assets | $ | 4,729,648,368 | ||
Components of Net Assets: | ||||
Paid-in capital (par value of $0.001 per share with an unlimited number of shares authorized) | $ | 4,673,166,605 | ||
Total distributable earnings | 56,481,763 | |||
Net Assets | $ | 4,729,648,368 | ||
Class I Shares: | ||||
Net assets applicable to shares outstanding | $ | 4,729,648,368 | ||
Shares of beneficial interest issued and outstanding | 446,076,567 | |||
Net asset value, offering, and redemption price per share | $ | 10.60 |
See accompanying Notes to Consolidated Financial Statements.
43
Cliffwater Corporate Lending Fund
Consolidated Statement of Operations
For the Year Ended December 31, 2021
Investment Income: | ||||
Interest | $ | 138,047,714 | ||
Dividends | 1,721,169 | |||
Distributions from investment partnerships ($26,798,853 from affiliates) | 60,260,957 | |||
Distributions from joint venture investments | 4,260,527 | |||
Miscellaneous income | 216,866 | |||
Total investment income | 204,507,233 | |||
Expenses: | ||||
Investment management fees | 23,509,800 | |||
Interest on secured revolving credit facility | 13,547,381 | |||
Sub-advisory fees | 1,089,539 | |||
Interest on reverse repurchase agreements and secured borrowings | 980,519 | |||
Legal fees | 782,847 | |||
Fund administration fees | 1,820,576 | |||
Fund accounting fees | 274,992 | |||
Registration fees | 293,226 | |||
Transfer agent fees and expenses | 452,114 | |||
Custody fees | 450,516 | |||
Audit fees | 348,334 | |||
Trustees’ fees and expenses | 261,000 | |||
Shareholder reporting fees | 278,281 | |||
Chief Compliance Officer fees | 66,266 | |||
Insurance fees | 27,495 | |||
Commitment fees on secured revolving credit facility | 553,261 | |||
Miscellaneous expenses | 958,316 | |||
Total fees and expenses | 45,694,463 | |||
Recapture of previously waived and/or reimbursed expenses (Note 4) | — | |||
Net expenses | 45,694,463 | |||
Net investment income | 158,812,770 | |||
Realized and Unrealized Gain (Loss): | ||||
Net realized gain (loss) on: | ||||
Investments in unaffiliated issuers | 8,588,233 | |||
Forward foreign currency exchange contracts | 4,120,659 | |||
Foreign currency transactions | 125,698 | |||
Net realized gain | 12,834,590 | |||
Net change in unrealized appreciation/depreciation on: | ||||
Investments in unaffiliated issuers | 34,398,249 | |||
Investments in affiliated issuers | 8,643,672 | |||
Investments in joint ventures | 3,883,122 | |||
Forward foreign currency exchange contracts | (772,170 | ) | ||
Foreign currency translations | (67,434 | ) | ||
Net change in unrealized appreciation/depreciation | 46,085,439 | |||
Net realized and unrealized gain | 58,920,029 | |||
Net Increase in Net Assets from Operations | $ | 217,732,799 |
See accompanying Notes to Consolidated Financial Statements.
44
Cliffwater Corporate Lending Fund
Consolidated Statements of Changes in Net Assets
For the | For the | |||||||
Net Increase in Net Assets from: | ||||||||
Operations: | ||||||||
Net investment income | $ | 158,812,770 | $ | 28,277,087 | ||||
Net realized gain on investments, forward foreign currency exchange contracts and foreign currency transactions | 12,834,590 | 492,246 | ||||||
Net change in unrealized appreciation/depreciation on investments, forward foreign currency exchange contracts and foreign currency translations | 46,085,439 | 12,737,906 | ||||||
Net increase in net assets resulting from operations | 217,732,799 | 41,507,239 | ||||||
Distributions to shareholders: | ||||||||
Distributions: | ||||||||
Class I | (173,398,542 | ) | (31,818,077 | ) | ||||
From return of capital: | ||||||||
Class I | (28,307,888 | ) | (4,439,794 | ) | ||||
Total | (201,706,430 | ) | (36,257,871 | ) | ||||
Capital Transactions: | ||||||||
Proceeds from shares sold: | ||||||||
Class I | 4,062,844,184 | 497,552,093 | ||||||
Reinvestment of distributions: | ||||||||
Class I | 62,384,398 | 8,708,770 | ||||||
Cost of shares repurchased: | ||||||||
Class I | (156,498,524 | ) | (35,154,685 | ) | ||||
Net increase in net assets from capital transactions | 3,968,730,058 | 471,106,178 | ||||||
Net increase in net assets | 3,984,756,427 | 476,355,546 | ||||||
Net Assets: | ||||||||
Beginning of period | 744,891,941 | 268,536,395 | ||||||
End of period | $ | 4,729,648,368 | $ | 744,891,941 | ||||
Capital Share Transactions: | ||||||||
Shares sold: | ||||||||
Class I | 382,870,006 | 48,087,003 | ||||||
Shares issued in reinvestment of distributions: | ||||||||
Class I | 5,911,991 | 849,428 | ||||||
Shares redeemed: | ||||||||
Class I | (14,649,800 | ) | (3,450,199 | ) | ||||
Net increase in capital shares outstanding | 374,132,197 | 45,486,232 |
See accompanying Notes to Consolidated Financial Statements.
45
Cliffwater Corporate Lending Fund
Consolidated Statement of Cash Flows
For the Year Ended December 31, 2021
Cash flows provided by (used in) operating activities: | ||||
Net increase in net assets from operations | $ | 217,732,799 | ||
Adjustments to reconcile net increase in net assets from operations to net cash provided by (used in) operating activities: | ||||
Purchases of investments | (6,596,620,140 | ) | ||
Sales of investments | 826,685,580 | |||
Net accretion on investments | (3,327,487 | ) | ||
Net realized gain on investments | (8,588,233 | ) | ||
Net realized gain on paydowns | (5,839,891 | ) | ||
Net change in unrealized (appreciation)/depreciation | (46,152,873 | ) | ||
Return of capital distributions received | 35,600,636 | |||
Original issue discount and amendment fees | 11,643,936 | |||
Change in short-term investments, net | (35,389,821 | ) | ||
(Increase)/Decrease in assets: | ||||
Foreign currency | (11,812,286 | ) | ||
Investment securities sold | (29,446,471 | ) | ||
Dividends and interest | (29,194,814 | ) | ||
Prepaid expenses | (460,866 | ) | ||
Prepaid commitment fees on secured revolving credit facility | (6,685,090 | ) | ||
Increase/(Decrease) in liabilities: | ||||
Investment securities purchased | (2,470,676 | ) | ||
Unfunded loan commitments | 717,794,325 | |||
Investment Management fees | 611,880 | |||
Sub-Advisory fees | (18,768 | ) | ||
Interest from reverse repurchase agreements | 766,740 | |||
Interest payable on secured revolving credit facility | 1,113,693 | |||
Audit fees | 20,777 | |||
Legal fees | 22,562 | |||
Fund administration fees | 520,380 | |||
Custody fees | 235,168 | |||
Transfer Agency fees and expenses | 68,548 | |||
Fund accounting fees | (18,046 | ) | ||
Chief Compliance Officer fees | 8,354 | |||
Other accrued expenses | 88,727 | |||
Net cash used in operating activities | (4,963,111,357 | ) |
See accompanying Notes to Consolidated Financial Statements.
46
Cliffwater Corporate Lending Fund
Consolidated Statement of Cash Flows
For the Year Ended December 31, 2021 (Continued)
Cash flows provided by (used in) financing activities: | ||||
Proceeds from shares sold, net of receivable for fund shares sold | $ | 4,012,807,858 | ||
Cost of shares repurchased | (156,498,524 | ) | ||
Distributions paid to shareholders, net of reinvestments | (139,322,032 | ) | ||
Proceeds from reverse repurchase agreements | 47,386,000 | |||
Payments made on reverse repurchase agreements | (53,110,000 | ) | ||
Proceeds from secured borrowings | 249,990,230 | |||
Proceeds from secured revolving credit facility | 1,392,000,000 | |||
Payments on secured revolving credit facility | (387,000,000 | ) | ||
Due to custodian | (1,846,840 | ) | ||
Net cash provided by financing activities | 4,964,406,692 | |||
Net increase in cash | 1,295,335 | |||
Cash | ||||
Cash, beginning of year | — | |||
Cash, end of year | $ | 1,295,335 |
Non cash financing activities not included herein consist of $62,384,398 of reinvested dividends.
Cash paid for interest on credit facility during the period was $12,433,688.
See accompanying Notes to Consolidated Financial Statements.
47
Cliffwater Corporate Lending Fund
Consolidated Financial Highlights
Class I
Per share operating performance.
For a capital share outstanding throughout the period.
For the | For the | For the Period | ||||||||||
Net asset value, beginning of period | $ | 10.35 | $ | 10.15 | $ | 10.00 | ||||||
Income from Investment Operations: | ||||||||||||
Net investment income1 | 0.72 | 0.72 | 0.34 | |||||||||
Net realized and unrealized gain (loss) on investments2 | 0.27 | 0.19 | (0.04 | ) | ||||||||
Total income from investment operations | 0.99 | 0.91 | 0.30 | |||||||||
Less Distributions to shareholders: | ||||||||||||
From net investment income | (0.62 | ) | (0.62 | ) | (0.15 | ) | ||||||
From return of capital | (0.10 | ) | (0.09 | ) | — | |||||||
From net realized gain | (0.02 | ) | — | 3 | — | 3 | ||||||
Total Distributions to shareholders | (0.74 | ) | (0.71 | ) | (0.15 | ) | ||||||
Net asset value, end of period | $ | 10.60 | $ | 10.35 | $ | 10.15 | ||||||
Total return4 | 10.38 | % | 9.25 | % | 3.05 | %5 | ||||||
Ratios and Supplemental Data: | ||||||||||||
Net assets, end of period (in thousands) | $ | 4,729,648 | $ | 744,892 | $ | 268,536 | ||||||
Ratio of expenses to average net assets (excluding interest expense): | ||||||||||||
Before fees waived | 1.32 | % | 1.80 | % | 2.25 | %6 | ||||||
After fees waived | 1.32 | % | 1.80 | % | 1.78 | %6 | ||||||
Ratio of net investment income to average net assets (excluding interest expense): | ||||||||||||
Before fees waived | 7.36 | % | 7.67 | % | 3.58 | %6 | ||||||
After fees waived | 7.36 | % | 7.67 | % | 4.05 | %6 | ||||||
Ratio of expenses to average net assets (including interest expense): | ||||||||||||
Before fees waived | 1.94 | % | 2.43 | % | 2.28 | %6 | ||||||
After fees waived | 1.94 | % | 2.43 | % | 1.81 | %6 | ||||||
Ratio of net investment income to average net assets (including interest expense): | ||||||||||||
Before fees waived | 6.74 | % | 7.04 | % | 3.55 | %6 | ||||||
After fees waived | 6.74 | % | 7.04 | % | 4.02 | %6 |
See accompanying Notes to Consolidated Financial Statements.
48
Cliffwater Corporate Lending Fund
Consolidated Financial Highlights
Class I (Continued)
For the | For the | For the Period | ||||||||||
Senior Securities | ||||||||||||
Total Amount Outstanding exclusive of Treasury Securities | ||||||||||||
Reverse Repurchase Agreements7 | $ | 6,833,000 | $ | 12,557,000 | $ | 6,034,000 | ||||||
Secured borrowings7 | 249,990,230 | — | — | |||||||||
Borrowings-Credit Facility Agreement7 | 1,195,000,000 | 190,000,000 | — | |||||||||
Asset Coverage Per $1,000 of Borrowings | ||||||||||||
Reverse Repurchase Agreements7 | 693,179 | 60,321 | 45,504 | |||||||||
Secured borrowings7 | 19,919 | — | — | |||||||||
Borrowings-Credit Facility Agreement7 | 4,958 | 4,916 | — | |||||||||
Portfolio turnover rate | 29 | % | 29 | % | 15 | %5 |
* | Commencement of operations. |
1 | Based on average daily shares outstanding for the period. |
2 | Realized and unrealized gains and losses per share are balancing amounts necessary to reconcile the change in net asset value per share with the other per share information presented. |
3 | Amount represents less than $0.01 per share. |
4 | Total returns would have been lower had expenses not been waived by the Investment Manager. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the repurchase of Fund shares. |
5 | Not annualized. |
6 | Annualized. |
7 | As a result of the Fund having earmarked or segregated securities to collateralize the transactions or otherwise having covered the transactions, in accordance with releases and interpretive letters issued by the Securities and Exchange Commission (the “SEC”), the Fund does not treat its obligations under such transactions as senior securities representing indebtedness for purposes of the Investment Company Act of 1940, as amended. |
See accompanying Notes to Consolidated Financial Statements.
49
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021
1. Organization
The Cliffwater Corporate Lending Fund (the “Fund”) is a Delaware statutory trust under the Investment Company Act of 1940, as amended (the “Investment Company Act”), as a non-diversified, closed-end management investment company operating as an interval fund. The Fund operates under an Agreement and Declaration of Trust, as most recently amended and restated on September 15, 2021 (the “Declaration of Trust”). Cliffwater LLC serves as the investment adviser (the “Investment Manager”) of the Fund. The Investment Manager is an investment adviser registered with the Securities and Exchange Commission (the “SEC”) under the Investment Advisers Act of 1940, as amended. The Fund intends to continue to qualify and has elected to be treated as a regulated investment company under the Internal Revenue Code of 1986, as amended (the “Code”). The Fund commenced operations on March 6, 2019.
The SEC has granted the Fund exemptive relief permitting the Fund to offer multiple classes of shares. The Fund’s Registration Statement currently offers Class I Shares. Only Class I shares have been issued as of December 31, 2021.
The Fund’s primary investment objective is to seek consistent current income, while the Fund’s secondary objective is capital preservation. Under normal market conditions, the Fund seeks to achieve its investment objectives by investing at least 80% of its assets (net assets, plus any borrowings for investment purposes) in loans to companies (“corporate loans”). The Fund’s corporate loan investments are made through a combination of: (i) investing in loans to companies that are originated directly by a non-bank lender (for example, traditional direct lenders include insurance companies, business development companies, asset management firms (on behalf of their investors), and specialty finance companies) (“direct loans”); (ii) investing in notes or other pass-through obligations representing the right to receive the principal and interest payments on a direct loan (or fractional portions thereof); (iii) purchasing asset-backed securities representing ownership or participation in a pool of direct loans; (iv) investing in companies and/or private investment funds (private funds that are excluded from the definition of “investment company” pursuant to Sections 3(c)(1) or 3(c)(7) of the Investment Company Act) that primarily hold direct loans (the foregoing investments listed in clauses (i) through (iv) are collectively referred to herein as the “Direct Loan Instruments”); (v) investments in high yield securities, including securities representing ownership or participation in a pool of such securities; and (vi) investments in bank loans including securities representing ownership or participation in a pool of such loans. The Fund may focus its investment strategy on, and its portfolio of investments may be focused in, a subset of one or more of these types of investments. The Fund’s investments in hedge funds and private equity funds that are excluded from the definition of “investment company” pursuant to Sections 3(c)(1) and 3(c)(7) of the Investment Company Act will be limited to no more than 15% of the Fund’s assets. Most direct loans are not rated by any rating agency, will not be registered with the SEC or any state securities commission and will not be listed on any national securities exchange. The amount of public information available with respect to issuers of direct loans may generally be less extensive than that available for issuers of registered or exchange listed securities.
2. Significant Accounting Policies
Basis of Preparation and Use of Estimates
The Fund is an investment company and follows the accounting and reporting guidance under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946, Financial Services – Investment Companies. The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of the financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from these estimates.
Consolidation of a Subsidiary
On February 3, 2020, CCLF SPV LLC (“CCLF SPV”) was formed as a limited liability company, and it is a wholly owned subsidiary of the Fund. The consolidated Schedule of Investments, Statement of Assets and Liabilities, Statement of Operations, Statements of Changes in Net Assets, Statement of Cash Flows and Financial Highlights of the Fund includes the accounts of CCLF SPV. All inter-company accounts and transactions have been eliminated in the consolidation for the Fund. As of December 31, 2021, net assets of the CCLF SPV LLC were $1,063,637,330, or approximately 22.49% of the Fund’s total net assets.
50
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
On April 15, 2021, MCCW Holdings, LLC (“CCLF MCCW”) was formed as a limited liability company, and it is a wholly owned subsidiary of CCLF SPV. The consolidated Schedule of Investments, Statement of Assets and Liabilities, Statement of Operations, Statements of Changes in Net Assets, Statement of Cash Flows and Financial Highlights of the Fund includes the accounts of CCLF MCCW. All inter-company accounts and transactions have been eliminated in the consolidation for the Fund. As of December 31, 2021, net assets of the CCLF MCCW were $166,646,212, or approximately 3.52% of the Fund’s total net assets and are included in the net assets of CCLF SVP LLC.
On May 25, 2021, CCLF Holdings LLC (“CCLF HOLD”) was formed as a limited liability company, and it is a wholly owned subsidiary of the Fund. The consolidated Schedule of Investments, Statement of Assets and Liabilities, Statement of Operations, Statements of Changes in Net Assets, Statement of Cash Flows and Financial Highlights of the Fund includes the accounts of CCLF HOLD. All inter-company accounts and transactions have been eliminated in the consolidation for the Fund. As of December 31, 2021, net assets of the CCLF HOLD were $18,375,545, or approximately 0.39% of the Fund’s total net assets.
On July 26, 2021, CCLF Holdings (D1) LLC (“CCLF HOLD (D1)”) was formed as a limited liability company, and is a wholly owned subsidiary of the Fund. The consolidated Schedule of Investments, Statement of Assets and Liabilities, Statement of Operations, Statements of Changes in Net Assets, Statement of Cash Flows and Financial Highlights of the Fund includes the accounts of CCLF HOLD (D1). All inter-company accounts and transactions have been eliminated in the consolidation for the Fund. As of December 31, 2021, net assets of the CCLF HOLD (D1) were $8,269,091, or approximately 0.17% of the Fund’s total net assets.
On September 17, 2021, Broadway Funding Holdings LLC (“Broadway Funding Holdings”) was formed as a limited liability company, and is a wholly owned subsidiary of the Fund. The consolidated Schedule of Investments, Statement of Assets and Liabilities, Statement of Operations, Statements of Changes in Net Assets, Statement of Cash Flows and Financial Highlights of the Fund includes the accounts of Broadway Funding Holdings. All inter-company accounts and transactions have been eliminated in the consolidation for the Fund. As of December 31, 2021, net assets of the Broadway Funding Holdings were $153,866,318, or approximately 3.25% of the Fund’s total net assets.
Investment Transactions and Related Investment Income
Investment transactions are accounted for on a trade-date basis. However, for daily NAV determination, portfolio securities transactions are reflected no later than in the first calculation on the first business day following trade date. Interest income is recognized on an accrual basis and includes, where applicable, the amortization of premium, accretion of discount and loan origination fees using the effective interest method over the respective term of the loan. Upon the prepayment of a loan or security, any unamortized loan origination fees, original issue discount and market discount are recorded as interest income. The Fund records prepayment premiums as interest income when it receives such amounts.
Interest income from investments in the “equity” class of collateralized loan obligation (“CLO”) funds will be recorded based upon an estimate of an effective yield to expected maturity utilizing assumed cash flows in accordance with FASB ASC 325-40, Beneficial Interests in Securitized Financial Assets. Effective yields for the CLO equity positions are updated generally once a quarter or on a transaction such as an add-on purchase, refinancing or reset. The estimated yield and investment cost may ultimately not be realized.
Realized gains and losses on investment transactions are determined using cost calculated on a specific identification basis. Paydown gains and losses are recorded as an adjustment to interest income in the consolidated Statement of Operations. Dividends are recorded on the ex-dividend date. Distributions from private investments that represent returns of capital in excess of cumulative profits and losses are credited to investment cost rather than investment income.
Federal Income Taxes
The Fund intends to continue to qualify as a “regulated investment company” under Subchapter M of the Internal Revenue Code of 1986, as amended. As so qualified, the Fund will not be subject to federal income tax to the extent it distributes substantially all of its net investment income and capital gains to shareholders. Therefore, no federal income tax provision is required. Management of the Fund is required to determine whether a tax position taken by the Fund is more likely than not to be sustained upon examination by the applicable taxing authority, based on the technical merits of the position. Based on its analysis, there were no tax positions identified by management of the Fund that did not meet the “more likely than not” standard as of December 31, 2021.
51
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
The Fund’s policy is to classify interest and penalties associated with underpayment of federal and state income taxes as an income tax expense on the Consolidated Statement of Operations. For the year ended December 31, 2021, the Fund did not have interest or penalties associated with underpayment of income taxes.
CCLF SPV, CCLF MC-CW, CCLF HOLD (D1) and Broadway Funding Holdings are disregarded entities for income tax purposes. CCLF HOLD is a corporation and is therefore obligated to pay federal and state income tax on its taxable income. Currently, the federal income tax rate for a corporation is 21%. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is recognized if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income tax asset will not be realized.
Distributions to Shareholders
Distributions are paid at least quarterly on the Shares in amounts representing substantially all of the Fund’s net investment income, if any, earned each year. The Fund determines annually whether to distribute any net realized long-term capital gains in excess of net realized short-term capital losses (including capital loss carryover); however, it may distribute any excess annually to its shareholders.
The exact amount of distributable income for each fiscal year can only be determined at the end of the Fund’s fiscal year, December 31. Under Section 19 of the Investment Company Act, the Fund is required to indicate the sources of certain distributions to shareholders. The estimated distribution composition may vary from quarter to quarter because it may be materially impacted by future income, expenses and realized gains and losses on securities and fluctuations in the value of the currencies in which Fund assets are denominated.
Foreign Currency Translation
The Fund’s records are maintained in U.S. dollars. The value of securities, currencies and other assets and liabilities denominated in currencies other than U.S. dollars are translated into U.S. dollars based upon foreign exchange rates prevailing at the end of the reporting period. The currencies are translated into U.S. dollars by using the exchange rates quoted at the close of the London Stock Exchange prior to when the Fund’s NAV is next determined. Purchases and sales of investment securities, income and expenses are translated on the respective dates of such transactions.
The Fund does not isolate that portion of their net realized and unrealized gains and losses on investments resulting from changes in foreign exchange rates from the impact arising from changes in market prices. Such fluctuations are included with net realized and unrealized gain or loss from investments and foreign currency.
Net realized foreign currency transaction gains and losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, and the differences between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency translation gains and losses arise from changes in the value of assets and liabilities, other than investments in securities, resulting from changes in the exchange rates.
Forward Foreign Currency Exchange Contracts
The Fund may utilize forward foreign currency exchange contracts (“forward contracts”) under which they are obligated to exchange currencies on specified future dates at specified rates, and are subject to the translations of foreign exchange rates fluctuations. All contracts are “marked-to-market” daily and any resulting unrealized gains or losses are recorded as unrealized appreciation or depreciation on foreign currency translations. The Fund records realized gains or losses at the time the forward contract is settled. Counter-parties to these forward contracts are major U.S. financial institutions. As of December 31, 2021, the Fund had sixteen outstanding forward currency contracts sold short.
Collateralized Loan Obligations and Collateralized Debt Obligations
The Fund may invest in CLOs and Collateralized Debt Obligations (“CDOs”). CLOs and CDOs are created by the grouping of certain private loans and other lender assets/collateral into pools. A sponsoring organization establishes a special purpose vehicle to hold the assets/collateral and issue securities. Interests in these pools are sold as individual securities. Payments of principal and interest are passed through to investors and are typically supported by some form of credit enhancement, such
52
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
as a letter of credit, surety bond, limited guaranty or senior/subordination. Payments from the asset pools may be divided into several different tranches of debt securities, offering investors various maturity and credit risk characteristics. Some tranches entitled to receive regular installments of principal and interest, other tranches entitled to receive regular installments of interest, with principal payable at maturity or upon specified call dates, and other tranches only entitled to receive payments of principal and accrued interest at maturity or upon specified call dates. Different tranches of securities will bear different interest rates, which may be fixed or floating.
CLOs and CDOs are typically privately offered and sold, and thus, are not registered under the securities laws, which means less information about the security may be available as compared to publicly offered securities and only certain institutions may buy and sell them. As a result, investments in CLOs and CDOs may be characterized by the Fund as illiquid securities. An active dealer market may exist for CLOs and CDOs that can be resold in Rule 144A transactions, but there can be no assurance that such a market will exist or will be active enough for the Fund to sell such securities.
Warehouse Investments
The Fund may invest in Warehouse investments (“Warehouses”), which are financing structures created prior to and in anticipation of CLO or CDO closings and issuing securities and are intended to aggregate direct loans, corporate loans and/or other debt obligations that may be used to form the basis of CLO or CDO vehicles. To finance the acquisition of a Warehouse’s assets, a financing facility (a “Warehouse Facility”) is often opened by (i) the entity or affiliates of the entity that will become the collateral manager of the CLO or CDO upon its closing and/or (ii) third-party investors that may or may not invest in the CLO or CDO. The period from the date that a Warehouse is opened and asset accumulation begins to the date that the CLO or CDO closes is commonly referred to as the “warehousing period.” In practice, investments in Warehouses are structured in a variety of legal forms, including subscriptions for equity interests or subordinated debt investments in special purpose vehicles that obtain a Warehouse Facility secured by the assets acquired in anticipation of a CLO or CDO closing.
The Warehouse investments represent leveraged investments in the underlying assets of a Warehouse. Therefore, the value of a Warehouse investment is often affected by, among other things, (i) changes in the market value of the underlying assets of the Warehouse; (ii) distributions, defaults, recoveries, capital gains, capital losses and prepayments on the underlying assets of the Warehouse; and (iii) the prices, interest rates and availability of eligible assets for reinvestment. Due to the leveraged nature of a Warehouse investment, a significant portion (and in some circumstances all) of the Warehouse investments made by the Fund may not be repaid.
Participations and Assignments
The Fund may acquire interests in loans either directly (by way of original issuance, sale or assignment) or indirectly (by way of participation). The purchaser of an assignment typically succeeds to all the rights and obligations of the assigning institution and becomes a lender under the credit agreement with respect to the debt obligation; however, its rights can be more restricted than those of the assigning institution. Participation interests in a portion of a debt obligation typically result in a contractual relationship only with the institution participating out the interest, not with the borrower. In purchasing participations, the Fund generally will have no right to enforce compliance by the borrower with the terms of the loan agreement, nor any rights of set-off against the borrower, and the Fund may not directly benefit from the collateral supporting the debt obligation in which it has purchased the participation. As a result, the Fund will assume the credit risk of both the borrower and the institution selling the participation.
Commitments and Contingencies
Commercial loans purchased by the Fund (whether through participations or as a lender of record) may be structured to include both term loans, which are generally fully funded at the time of investment, and unfunded loan commitments, which are contractual obligations for future funding. Unfunded loan commitments may include revolving credit facilities and delayed draw term loans, which may obligate the Fund to supply additional cash to the borrower on demand, representing a potential financial obligation by the Fund in the future. The Fund may receive a commitment fee based on the undrawn portion of such unfunded loan commitments. The commitment fee is typically set as a percentage of the commitment amount. Commitment fees are processed as income when received and are part of the interest income in the Statement of Operations. As of December 31, 2021, the Fund received $1,240,898 in commitment fees. As of December 31, 2021, the Fund had the following unfunded loan commitments as noted in the consolidated Schedule of Investments with a total principal amount of $774,351,825 reflected as unfunded loan commitments within the consolidated Statement of Assets and Liabilities.
53
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Borrower | Type | Principal | Value | ||||||
ACI Group Holdings, Inc. | Delayed Draw | $ | 3,723,214 | $ | 3,685,982 | ||||
ADCS Clinics Intermediate Holdings, LLC | Delayed Draw | 1,191,736 | 1,174,455 | ||||||
Any Hour, LLC | Delayed Draw | 546,667 | 541,200 | ||||||
Any Hour, LLC | Revolver | 2,000,000 | 1,980,000 | ||||||
Air Comm Corporation, LLC | Delayed Draw | 1,588,658 | 1,580,715 | ||||||
Air Comm Corporation, LLC | Delayed Draw | 243,902 | 241,463 | ||||||
Air Comm Corporation, LLC | Revolver | 950,612 | 941,106 | ||||||
Air Comm Corporation, LLC | Revolver | 1,653,022 | 1,636,492 | ||||||
Alera Group Holdings, Inc. | Delayed Draw | 13,341,273 | 13,274,567 | ||||||
Answer Acquisition | Revolver | 1,333,571 | 1,306,900 | ||||||
Apex Service Partners, LLC | Revolver | 1,200,000 | 1,199,400 | ||||||
Appfire Technologies, LLC | Delayed Draw | 13,376,571 | 13,327,078 | ||||||
AQ Sage Buyer, LLC | Delayed Draw | 18,750,000 | 18,703,125 | ||||||
Ardurra Group LLC | Delayed Draw | 651,720 | 651,720 | ||||||
Armada Parent, Inc. | Delayed Draw | 2,000,000 | 1,980,000 | ||||||
Armada Parent, Inc. | Revolver | 2,200,000 | 2,156,000 | ||||||
Aspen Opco, LLC | Revolver | 2,272,727 | 2,250,000 | ||||||
Applied Technical Services | Delayed Draw | 3,068,182 | 3,068,182 | ||||||
Applied Technical Services | Delayed Draw | 3,409,091 | 3,409,091 | ||||||
Applied Technical Services | Revolver | 681,818 | 680,318 | ||||||
AWT Merger Sub, Inc. | Delayed Draw | 1,142,857 | 1,142,857 | ||||||
AWT Merger Sub, Inc. | Delayed Draw | 2,421,429 | 2,397,214 | ||||||
AWT Merger Sub, Inc. | Revolver | 985,714 | 985,714 | ||||||
AxiomSL Group, Inc. | Delayed Draw | 713,267 | 707,846 | ||||||
AxiomSL Group, Inc. | Revolver | 731,098 | 725,542 | ||||||
Barracuda Dental LLC | Delayed Draw | 390,805 | 383,110 | ||||||
Barracuda Dental LLC | Revolver | 620,689 | 610,696 | ||||||
Blackbird Purchaser, Inc. | Delayed Draw | 4,392,446 | 4,348,521 | ||||||
Blackbird Purchaser, Inc. | Delayed Draw | 10,713,282 | 10,713,282 | ||||||
BCHR US Acquisitions, Inc. | Delayed Draw | 1,886,792 | 1,867,925 | ||||||
BCHR US Acquisitions, Inc. | Revolver | 905,660 | 887,547 | ||||||
BCPE North Star US Holdings Co. | Delayed Draw | 2,210,526 | 2,205,000 | ||||||
Beacon Mobility Corp. | Delayed Draw | 165,214 | 163,892 | ||||||
Beacon Mobility Corp. | Delayed Draw | 585,797 | 581,110 | ||||||
Beacon Mobility Corp. | Revolver | 1,000,000 | 992,000 | ||||||
Bendon | Revolver | 1,800,000 | 1,737,720 | ||||||
Berlin Packaging | Second Lien Term Loan | 4,527,699 | 5,090,053 |
54
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Borrower | Type | Principal | Value | ||||||
Biocare Medical LLC | Revolver | $ | 2,777,778 | $ | 2,750,000 | ||||
BlueHalo Global Holdings, LLC | Revolver | 548,120 | 542,639 | ||||||
Bounteous, Inc. | Delayed Draw | 4,300,000 | 4,257,000 | ||||||
Bounteous, Inc. | Revolver | 1,488,000 | 1,458,240 | ||||||
BusinesSolver.com, Inc. | Delayed Draw | 1,378,788 | 1,371,894 | ||||||
Connect America.com, LLC | Revolver | 672,304 | 658,858 | ||||||
Captify Intermediate Holdings Corp. | Delayed Draw | 2,500,000 | 2,481,250 | ||||||
CC SAG Acquisition Corp. | Delayed Draw | 3,356,643 | 3,308,126 | ||||||
CC SAG Acquisition Corp. | Revolver | 699,301 | 689,193 | ||||||
CFGI Holdings, LLC | Delayed Draw | 2,189,781 | 2,189,781 | ||||||
CFGI Holdings, LLC | Revolver | 1,751,825 | 1,734,307 | ||||||
Citrin Cooperman Advisors, LLC | Delayed Draw | 2,647,059 | 2,633,824 | ||||||
Classic Collision | Delayed Draw | 7,803,192 | 7,647,128 | ||||||
Classic Collision | Revolver | 1,382,979 | 1,355,319 | ||||||
Cleo Communications Holding, LLC | Revolver | 2,140,000 | 2,136,362 | ||||||
Community Medical Acquisition Corp. | Delayed Draw | 4,333,814 | 4,284,842 | ||||||
Community Medical Acquisition Corp. | Revolver | 3,683,963 | 3,610,283 | ||||||
Consolidated Label Co. | Revolver | 1,339,286 | 1,332,589 | ||||||
Consolidated Label Co. | Revolver | 578,516 | 575,623 | ||||||
CORA Health Holdings Corp. | Delayed Draw | 5,401,846 | 5,347,827 | ||||||
CORA Health Holdings Corp. | Revolver | 700,000 | 693,000 | ||||||
Credit Connection, LLC | Revolver | 600,000 | 588,000 | ||||||
CRS TH Holdings Corp | Delayed Draw | 6,355,932 | 6,324,153 | ||||||
CRS TH Holdings Corp | Revolver | 4,237,288 | 4,194,915 | ||||||
HPS Consumer Discretionary | First Lien Term Loan | 17,079 | 16,712 | ||||||
HPS Specialty Loan Fund V Feeder LP | First Lien Term Loan | 67,500,000 | 67,500,000 | ||||||
D4C Dental Brands, Inc. | Delayed Draw | 1,363,379 | 1,396,100 | ||||||
D4C Dental Brands, Inc. | Revolver | 178,571 | 182,857 | ||||||
DataLink, LLC | Delayed Draw | 1,185,484 | 1,185,484 | ||||||
DataLink, LLC | Revolver | 846,774 | 846,774 | ||||||
DCA Holdings LLC | Delayed Draw | 2,413,559 | 2,380,252 | ||||||
Deca Dental Holdings, LLC | Delayed Draw | 3,333,333 | 3,289,744 | ||||||
Deca Dental Holdings, LLC | Revolver | 1,111,111 | 1,088,889 | ||||||
Diligent Corporation | Delayed Draw | 1,254,400 | 1,245,117 | ||||||
Integrated Oncology Network, LLC | Revolver | 83,957 | 83,537 | ||||||
EAP Holdco, LLC | Delayed Draw | 1,903,188 | 1,893,673 | ||||||
EAP Holdco, LLC | Revolver | 1,804,883 | 1,786,834 |
55
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Borrower | Type | Principal | Value | ||||||
ERC Holdings, LLC | Delayed Draw | $ | 3,550,296 | $ | 3,514,793 | ||||
ERC Holdings, LLC | Revolver | 1,420,118 | 1,405,917 | ||||||
RCS Industrials | Revolver | 285,714 | 285,714 | ||||||
FLS Holding, Inc. | Delayed Draw | 5,000,000 | 4,950,000 | ||||||
FLS Holding, Inc. | Delayed Draw | 2,083,333 | 2,062,500 | ||||||
FLS Holding, Inc. | Revolver | 2,000,000 | 1,960,000 | ||||||
FLS Holding, Inc. | Revolver | 833,333 | 816,667 | ||||||
Fingerpaint Marketing, Inc. | Delayed Draw | 10,296,637 | 10,245,153 | ||||||
Fingerpaint Marketing, Inc. | Revolver | 1,680,108 | 1,663,306 | ||||||
Follett School Solutions | Revolver | 920,223 | 901,818 | ||||||
Fortis Solutions Group, LLC | Delayed Draw | 5,247,376 | 5,194,903 | ||||||
Fortis Solutions Group, LLC | Delayed Draw | 1,874,063 | 1,855,322 | ||||||
Fortis Solutions Group, LLC | Revolver | 1,799,100 | 1,763,118 | ||||||
Fortis Solutions Group, LLC | Revolver | 642,536 | 629,685 | ||||||
Fortis Life Sciences, LLC | Delayed Draw | 12,173,913 | 12,052,174 | ||||||
Fortis Life Sciences, LLC | Delayed Draw | 4,260,870 | 4,218,261 | ||||||
Fortis Life Sciences, LLC | Revolver | 1,826,087 | 1,807,826 | ||||||
Foundation Risk Partners, Corp. | Delayed Draw | 576,191 | 569,401 | ||||||
Foundation Risk Partners, Corp. | Revolver | 653,009 | 643,214 | ||||||
Gainsight, Inc. | Revolver | 2,625,000 | 2,579,063 | ||||||
Galway Borrower, LLC | Delayed Draw | 725,675 | 718,418 | ||||||
Galway Borrower, LLC | Delayed Draw | 1,084,966 | 1,074,116 | ||||||
Galway Borrower, LLC | Revolver | 694,552 | 680,661 | ||||||
Galway Borrower, LLC | Revolver | 814,315 | 798,029 | ||||||
Galway Borrower, LLC | Delayed Draw | 1,847,507 | 1,829,032 | ||||||
Galway Borrower, LLC | Revolver | 879,765 | 862,170 | ||||||
GOVDELIVERY Holdings, LLC | Delayed Draw | 3,334,737 | 3,268,042 | ||||||
GOVDELIVERY Holdings, LLC | Revolver | 536,402 | 525,673 | ||||||
GovBrands Intermediate, Inc. | Delayed Draw | 905,972 | 886,901 | ||||||
GovBrands Intermediate, Inc. | Revolver | 917,000 | 894,075 | ||||||
Govbrands Intermediate, Inc. | Delayed Draw | 718,182 | 703,064 | ||||||
Govbrands Intermediate, Inc. | Revolver | 545,455 | 531,818 | ||||||
Graffiti Buyer, Inc. | Delayed Draw | 5,044,643 | 4,994,196 | ||||||
Graffiti Buyer, Inc. | Revolver | 2,059,896 | 2,039,297 | ||||||
GraphPAD Software, LLC | Delayed Draw | 4,411,765 | 4,367,647 | ||||||
Hawkeye AcquisitionCo, LLC | Revolver | 500,000 | 497,500 | ||||||
Higginbotham Insurance Agency, Inc. | Delayed Draw | 13,166,667 | 13,092,933 |
56
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Borrower | Type | Principal | Value | ||||||
Higginbotham Insurance Agency, Inc. | Delayed Draw | $ | 2,536,930 | $ | 2,522,723 | ||||
Heartland Veterinary | Delayed Draw | 5,052,226 | 5,001,704 | ||||||
Heartland Veterinary | Second Lien Term Loan | 86,800 | 86,140 | ||||||
Heartland Veterinary | Revolver | 519,154 | 513,963 | ||||||
Iconic Purchaser Corporation | Delayed Draw | 2,051,282 | 2,030,769 | ||||||
Iconic Purchaser Corporation | Revolver | 1,538,462 | 1,507,692 | ||||||
Isaac Heating & Air Conditioning | Delayed Draw | 2,210,526 | 2,188,421 | ||||||
Isaac Heating & Air Conditioning | Revolver | 1,736,842 | 1,719,474 | ||||||
Imagine Acquisitionco, Inc | Delayed Draw | 1,607,717 | 1,599,678 | ||||||
Imagine Acquisitionco, Inc | Revolver | 1,157,556 | 1,145,981 | ||||||
ISS Compressors Industries, Inc. | Revolver | 375,000 | 366,263 | ||||||
Inovalon Holdings, Inc. | Delayed Draw | 1,349,649 | 1,332,778 | ||||||
Insight Global | Revolver | 361,272 | 354,046 | ||||||
insightsoftware | Delayed Draw | 4,661,000 | 4,649,348 | ||||||
insightsoftware | Revolver | 366,345 | 364,696 | ||||||
Integrity Marketing | Delayed Draw | 3,750,000 | 3,721,875 | ||||||
JTM Foods, LLC | Delayed Draw | 1,158,366 | 1,138,094 | ||||||
JTM Foods, LLC | Revolver | 559,597 | 549,804 | ||||||
KBP Brands, LLC | Delayed Draw | 20,000,000 | 19,900,000 | ||||||
Keystone Agency Investors | Delayed Draw | 2,344,737 | 2,320,821 | ||||||
Keystone Agency Investors | Delayed Draw | 2,578,125 | 2,539,453 | ||||||
Keystone Agency Investors | Delayed Draw | 5,625,000 | 5,540,625 | ||||||
Komline-Sanderson Group, Inc. | Revolver | 1,210,938 | 1,210,938 | ||||||
KPSKY Acquisition, Inc. | Delayed Draw | 753,205 | 741,907 | ||||||
KPSKY Acquisition, Inc. | Delayed Draw | 377,074 | 371,418 | ||||||
KWOR Acquisition, Inc. | Revolver | 829,268 | 816,829 | ||||||
KWOR Acquisition, Inc. | Revolver | 1,792,683 | 1,774,756 | ||||||
Life Science Intermediate Holdings, LLC | Delayed Draw | 3,750,000 | 3,712,500 | ||||||
RCS Industrials | Revolver | 208,333 | 209,896 | ||||||
LMG Holdings, Inc. | Revolver | 285,714 | 282,857 | ||||||
LOC Performance Products | Revolver | 3,856,132 | 3,817,571 | ||||||
Len the Plumber, LLC | Delayed Draw | 837,265 | 820,520 | ||||||
Premier Imaging, LLC | Delayed Draw | 14,525,790 | 14,380,532 | ||||||
Majco LLC | Delayed Draw | 7,583,333 | 7,583,333 | ||||||
Majco LLC | Revolver | 1,666,667 | 1,650,000 | ||||||
Marquee Dental | Delayed Draw | 10,552 | 10,278 | ||||||
Ministry Brands Merger Sub, LLC | Delayed Draw | 5,649,718 | 5,593,220 |
57
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Borrower | Type | Principal | Value | ||||||
Ministry Brands Merger Sub, LLC | Revolver | $ | 1,694,915 | $ | 1,661,017 | ||||
MBS Holdings, Inc. | Revolver | 1,271,186 | 1,245,763 | ||||||
Mc Group Ventures Corporation | Delayed Draw | 4,519,231 | 4,428,846 | ||||||
Management Consulting & Research, LLC | Revolver | 2,195,341 | 2,162,410 | ||||||
Mefla UK Limited | First Lien Term Loan | 3,024 | 4,036 | ||||||
Mefla UK Limited | First Lien Term Loan | 156,822 | 17,114 | ||||||
MedMark Services, Inc. | Delayed Draw | 6,809,914 | 6,741,814 | ||||||
MedMark Services, Inc. | Delayed Draw | 1,102,478 | 1,091,454 | ||||||
MSM Acquisitions | Delayed Draw | 12,500,000 | 12,500,000 | ||||||
New Era Technology | Delayed Draw | 672,697 | 675,724 | ||||||
New Era Technology | Revolver | 152,022 | 152,706 | ||||||
NL1 Acquire Corp. | Delayed Draw | 2,598,371 | 2,019,746 | ||||||
NL1 Acquire Corp. | Delayed Draw | 1,223,676 | 1,217,558 | ||||||
NL1 Acquire Corp. | Revolver | 1,160,727 | 902,248 | ||||||
Northstar Recycling | Revolver | 2,000,000 | 1,960,000 | ||||||
Obagi Cosmeceuticals LLC | Revolver | 2,500,000 | 2,500,000 | ||||||
OB Hospitalist Group | Revolver | 1,534,351 | 1,503,664 | ||||||
OIA Acquisition, LLC | Delayed Draw | 459,000 | 456,705 | ||||||
OIA Acquisition, LLC | Revolver | 1,928,571 | 1,909,286 | ||||||
Olympic Buyer, Inc. | Revolver | 2,352,941 | 2,299,529 | ||||||
Omni Intermediate Holdings, LLC | Delayed Draw | 2,676,056 | 2,662,676 | ||||||
Omni Intermediate Holdings, LLC | Delayed Draw | 842,958 | 838,743 | ||||||
Omni Intermediate Holdings, LLC | Revolver | 1,689,141 | 1,672,249 | ||||||
Omni Intermediate Holdings, LLC | Revolver | 532,394 | 527,070 | ||||||
OneCare Media, LLC | Revolver | 1,333,333 | 1,313,333 | ||||||
Patriot Growth Insurance Services, LLC | Delayed Draw | 8,594,340 | 8,594,340 | ||||||
Patriot Growth Insurance Services, LLC | Delayed Draw | 1,837,657 | 1,819,281 | ||||||
Patriot Growth Insurance Services, LLC | Revolver | 467,767 | 458,412 | ||||||
Patriot Growth Insurance Services, LLC | Revolver | 2,660,377 | 2,633,774 | ||||||
PCX Holding Corp. | Delayed Draw | 625,000 | 625,000 | ||||||
PCX Holding Corp. | Revolver | 625,000 | 625,000 | ||||||
Pinnacle Dermatology Management, LLC | Delayed Draw | 3,092,784 | 3,092,784 | ||||||
Pinnacle Dermatology Management, LLC | Revolver | 1,082,474 | 1,068,943 | ||||||
PDQ | Revolver | 1,764,706 | 1,733,824 | ||||||
Pegasus Global Enterprise Holdings, LLC | Delayed Draw | 1,944,167 | 1,929,586 | ||||||
Peter C. Foy & Associates Insurance Services, LLC | Delayed Draw | 346,502 | 343,618 |
58
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Borrower | Type | Principal | Value | ||||||
Peter C. Foy & Associates Insurance Services, LLC | Revolver | $ | 184,900 | $ | 183,051 | ||||
Pinnacle Treatment Centers, Inc. | Delayed Draw | 228,571 | 228,571 | ||||||
Pinnacle Treatment Centers, Inc. | Revolver | 285,714 | 285,714 | ||||||
Purfoods, LLC | Delayed Draw | 1,125,000 | 1,125,000 | ||||||
PT Intermediate Holdings III, LLC | Delayed Draw | 13,100,000 | 13,100,000 | ||||||
PT Intermediate Holdings III, LLC | Delayed Draw | 3,470,000 | 3,470,000 | ||||||
ProcessUnity Holdings, LLC | Delayed Draw | 1,000,000 | 990,000 | ||||||
ProcessUnity Holdings, LLC | Revolver | 1,000,000 | 980,000 | ||||||
Jigsaw Bidco AS | First Lien Term Loan | 139,882 | 15,673 | ||||||
Quantic Electronics, LLC | Delayed Draw | 1,419,994 | 1,412,894 | ||||||
Quantic Electronics, LLC | Revolver | 428,397 | 426,255 | ||||||
Race Winning Brands, Inc. | Revolver | 2,476,931 | 2,452,162 | ||||||
Ranger Buyer, Inc. | Revolver | 1,538,462 | 1,523,077 | ||||||
RefrigiWear, LLC | Revolver | 1,925,403 | 1,906,149 | ||||||
Regent Holding Company, LLC | Revolver | 575,188 | 572,312 | ||||||
Reorg Research, Inc. | Delayed Draw | 3,571,429 | 3,535,714 | ||||||
Revalize, Inc. | Delayed Draw | 6,808,000 | 6,773,960 | ||||||
Revalize, Inc. | Delayed Draw | 7,092,188 | 7,056,727 | ||||||
Revalize, Inc. | Revolver | 681,000 | 674,190 | ||||||
Revalize, Inc. | Revolver | 709,375 | 702,281 | ||||||
RQM Buyer, Inc. | Delayed Draw | 4,687,500 | 4,640,625 | ||||||
RSC Acquisition, Inc. | Delayed Draw | 7,771,084 | 7,693,374 | ||||||
RSC Acquisition, Inc. | Delayed Draw | 2,937,146 | 2,907,775 | ||||||
S4T Holdings Corp. | First Lien Term Loan | 4,545,455 | 4,522,727 | ||||||
Safety Borrower Holdings | Delayed Draw | 1,694,915 | 1,686,441 | ||||||
Safety Borrower Holdings | Revolver | 677,966 | 671,186 | ||||||
Seko Global Logistics Network, LLC | Revolver | 58,596 | 57,717 | ||||||
Sherlock Buyer Corp. | Delayed Draw | 2,052,750 | 2,032,223 | ||||||
Sherlock Buyer Corp. | Revolver | 821,100 | 804,678 | ||||||
Benefit Street Technology | Revolver | 2,666,667 | 2,613,333 | ||||||
Smile Doctors, LLC | Delayed Draw | 2,893,993 | 2,879,523 | ||||||
Smile Doctors, LLC | Revolver | 2,102,474 | 2,081,449 | ||||||
The Smilist Company | Delayed Draw | 960,365 | 952,778 | ||||||
The Smilist Company | Revolver | 582,039 | 577,441 | ||||||
Sonny’s Enterprises, LLC | Delayed Draw | 6,525,000 | 6,394,500 | ||||||
Sonny’s Enterprises, LLC | Revolver | 548,780 | 548,780 |
59
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Borrower | Type | Principal | Value | ||||||
Spartronics LLC | Revolver | $ | 1,441,631 | $ | 1,430,819 | ||||
Spartronics LLC | Revolver | 837,871 | 831,587 | ||||||
Spear Education, LLC | Delayed Draw | 1,562,500 | 1,562,500 | ||||||
Stanton Carpet Corp. | Revolver | 1,189,468 | 1,177,574 | ||||||
Sweep Purchaser LLC | Delayed Draw | 1,750,000 | 1,732,500 | ||||||
Syntax Systems Ltd. | Delayed Draw | 4,950,495 | 4,900,990 | ||||||
Syntax Systems Ltd. | Revolver | 1,114,191 | 1,103,050 | ||||||
Technimark Holdings, LLC | Second Lien Term Loan | 2,250,000 | 2,221,875 | ||||||
THG Acquisition, LLC | Delayed Draw | 13,981,177 | 13,911,271 | ||||||
THG Acquisition, LLC | Revolver | 743,884 | 736,445 | ||||||
Tilley Chemical Co., Inc. | Revolver | 622,222 | 616,000 | ||||||
Time Manufacturing Acquisition, LLC | Delayed Draw | 11,134,894 | 12,391,119 | ||||||
Time Manufacturing Acquisition, LLC | Delayed Draw | 5,215,084 | 5,097,744 | ||||||
Time Manufacturing Acquisition, LLC | Revolver | 1,369,863 | 1,354,521 | ||||||
Titan Group Holdco, LLC | Delayed Draw | 2,500,000 | 2,475,000 | ||||||
Titan Group Holdco, LLC | Delayed Draw | 2,500,000 | 2,475,000 | ||||||
Titan Group Holdco, LLC | Delayed Draw | 3,750,000 | 3,712,500 | ||||||
Titan Group Holdco, LLC | Revolver | 2,000,000 | 1,980,000 | ||||||
Trident Maritime Systems, Inc. | Revolver | 1,444,444 | 1,437,222 | ||||||
Troy Gastroenterology, P.C. | Delayed Draw | 2,561,576 | 2,561,576 | ||||||
Troy Gastroenterology, P.C. | Revolver | 591,133 | 591,133 | ||||||
Trunk Acquisition, Inc. | Revolver | 642,857 | 636,429 | ||||||
Trunk Acquisition, Inc. | Revolver | 2,500,000 | 2,475,000 | ||||||
Transtar Holding Company | Delayed Draw | 1,448,276 | 1,433,793 | ||||||
Turbo Buyer, Inc. | Delayed Draw | 2,300,000 | 2,271,250 | ||||||
Uniguest | Delayed Draw | 1,592,105 | 1,592,105 | ||||||
Uniguest | Revolver | 526,316 | 526,316 | ||||||
Urology Management Holdings, Inc. | Delayed Draw | 10,664,453 | 10,557,808 | ||||||
USME Holdings LLC | Delayed Draw | 743,478 | 743,478 | ||||||
USME Holdings LLC | Revolver | 936,232 | 936,232 | ||||||
USRP Holdings, Inc. | Delayed Draw | 6,892,844 | 6,754,987 | ||||||
USRP Holdings, Inc. | Revolver | 634,409 | 621,720 | ||||||
Vale Insurance Services LLC | Revolver | 2,204,403 | 2,182,359 | ||||||
Vetcor Professional Practices LLC | Delayed Draw | 7,920,421 | 7,880,819 | ||||||
Vetcor Professional Practices LLC | Second Lien Delayed Draw | 9,473,684 | 9,402,632 | ||||||
Vetcor Professional Practices LLC | Revolver | 1,010,526 | 1,000,421 | ||||||
The Vertex Companies, Inc. | Delayed Draw | 3,913,043 | 3,883,696 |
60
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Borrower | Type | Principal | Value | ||||||
The Vertex Companies, Inc. | Revolver | $ | 1,304,348 | $ | 1,284,783 | ||||
Vital Care Buyer, LLC | Revolver | 1,777,778 | 1,777,778 | ||||||
VLS Recovery Services, LLC | Delayed Draw | 5,952,381 | 5,892,857 | ||||||
VLS Recovery Services, LLC | Revolver | 2,040,816 | 2,020,408 | ||||||
VRC Companies, LLC | Delayed Draw | 1,890,625 | 1,852,813 | ||||||
VRC Companies, LLC | Revolver | 625,000 | 612,500 | ||||||
Water Holdings Acquisition, LLC | Revolver | 872,877 | 855,419 | ||||||
WCAS Orthopedics MSO, LLC | Revolver | 1,724,138 | 1,706,897 | ||||||
World Insurance Associates, LLC | Delayed Draw | 8,321,311 | 8,238,098 | ||||||
World Insurance Associates, LLC | Delayed Draw | 6,934,426 | 6,865,082 | ||||||
Zavation Medical Products, LLC | First Lien Term Loan | 1,621,622 | 1,605,405 | ||||||
$ | 774,351,825 | $ | 769,120,303 |
Valuation of Investments
The Fund’s Valuation Committee (“Valuation Committee”) oversees the valuation of the Fund’s investments on behalf of the Fund. The Board of Trustees of the Fund (the “Board”) has approved the valuation policy and procedures for the Fund (the “Valuation Procedures”). Securities listed on a securities exchange, market or automated quotation system for which quotations are readily available (except for securities traded on NASDAQ), including securities traded over the counter, are valued at the last quoted sale price on the primary exchange or market (foreign or domestic) on which they are traded on a day the Fund will calculate its net asset value as of the close of business on each day that the New York Stock Exchange is open for business and at such other times as the Board shall determine (each a “Determination Date” or at approximately 4:00 pm U.S. Eastern Time if a security’s primary exchange is normally open at that time), or, if there is no such reported sale on the Determination Date, the mean between the closing bid and asked prices and if no asked price is available, at the bid price. For securities traded on NASDAQ, the NASDAQ Official Closing Price (which is the last trade price at or before 4:00:02 p.m. U.S. Eastern Time adjusted up to NASDAQ’s best offer price if the last trade price is below such bid and down to NASDAQ’s best offer price if the last trade is above such offer price) will be used.
Fixed income securities (including corporate bonds and senior secured loans) with a remaining maturity of 60 days or more for which accurate market quotations are readily available will normally be valued according to dealer supplied mean quotations or mean quotations from a recognized pricing service. The independent pricing agents may employ methodologies that utilize actual market transactions (if the security is actively traded), broker-dealer supplied valuations, or matrix pricing. Matrix pricing determines a security’s value by taking into account such factors as security prices, yields, maturities, call features, ratings and developments relating to comparable securities. Debt obligations with remaining maturities of sixty days or less when originally acquired will be valued at their amortized cost, which approximates fair market value.
Corporate loans are generally valued using unobservable pricing inputs received from the Sub-Advisers or the Fund’s investment partners. The Investment Manager will continuously monitor the valuations of Fund investments provided by the Sub-Advisers and investment partners and review any material concerns with the Valuation Committee. The Investment Manager may conclude, however, in certain circumstances, that a fair valuation provided by a Sub-Adviser or investment partner does not represent the fair value of a Fund investment and is not indicative of what actual fair value would be in an active, liquid or established market. In those circumstances, the Fund might value such investment at a discount or a premium to the value it receives from the Sub-Adviser or investment partner, in accordance with the Fund’s valuation procedures. Any such decision would be made in good faith, and subject to the review and supervision of the Valuation Committee. The Investment Manager may choose to value certain immaterial direct corporate loans internally upon approval of the Valuation Committee. The Board will consider, no less frequently than quarterly, all relevant information and the reliability of pricing information provided by the Sub-Advisers and investment partners. Additionally, the values of the Funds’ direct loan investments are adjusted daily based on the estimated total return that the asset will generate during the current quarter. The Investment Manager, Sub-Advisers and the Valuation Committee monitor these estimates regularly and update them
61
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
as necessary if macro or individual changes warrant any adjustments. At the end of the quarter, each direct loan’s value is adjusted based on the actual income and appreciation or depreciation realized by such loan when its quarterly valuations and income are reported. This information is updated as soon as the information becomes available.
CLOs are not traded on a national securities exchange and instead are valued utilizing a market approach. The market approach is a method of determining the valuation of a security based on the selling price of similar securities. The types of factors that may be taken into account in pricing CLOs include: the yield of similar CLOs where pricing is available in the market; the riskiness of the underlying pool of loans; features of the CLO, including weighted average life test, liability pricing, management fees, covenant cushions, weighted average spread of underlying loans and net asset value.
Redeemable securities issued by open-end registered investment companies are valued at the investment company’s applicable net asset value as reported by such companies, with the exception of exchange-traded open-end registered investment companies which are priced in accordance with the first paragraph within this valuation of investments section.
The Fund may invest in interests or shares in private investment companies and/or funds (“Private Investment Funds”) where the net asset value is calculated and reported by respective unaffiliated investment managers on a monthly or quarterly basis. Unless the Investment Manager is aware of information that a value reported to the Fund by a portfolio, underlying manager, or administrator does not accurately reflect the value of the Fund’s interest in that Private Investment Fund, the Investment Manager will use the net asset value provided by the Private Investment Funds as a practical expedient to estimate the fair value of such interests.
Reverse Repurchase Agreements
In a reverse repurchase agreement, the Fund delivers a security in exchange for cash to a financial institution, the counterparty, with a simultaneous agreement to repurchase the same or substantially the same security at an agreed upon price and date. In an open maturity reverse repurchase agreement, there is no pre-determined repurchase date and the agreement can be terminated by the Fund or counterparty at any time. The Fund is entitled to receive principal and interest payments, if any, made on the security delivered to the counterparty during the term of the agreement. Cash received in exchange for securities delivered and accrued interest payments to be made by the Fund to counterparties are reflected as liabilities on the consolidated Statement of Assets and Liabilities. Interest payments made by the Fund to counterparties are recorded as interest from reverse repurchase agreements on the consolidated Statement of Operations. In periods of increased demand for the security, the Fund may receive a fee for use of the security by the counterparty, which may result in interest income to the Fund. In the event the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes insolvent, the Fund’s use of the proceeds of the agreement may be restricted pending a determination by the other party, or its trustee or receiver, whether to enforce the Fund’s obligation to repurchase the securities. Reverse repurchase agreements involve leverage risk and also the risk that the market value of the securities to be repurchased may decline below the repurchase price.
Master Repurchase Agreements and Global Master Repurchase Agreements (individually and collectively “Master Repo Agreements”) govern repurchase, reverse repurchase, and certain sale-buyback transactions between the Fund and select counterparties. Master Repo Agreements maintain provisions for, among other things, initiation, income payments, events of default, and maintenance of collateral. The value of transactions under the Master Repo Agreement, collateral pledged or received, and the net exposure by counterparty as of period end are disclosed in the consolidated Schedule of Investments and footnote 12 thereto. For the year ended December 31, 2021, the average balance outstanding and weighted average interest rate were $12,479,359 and 1.69%, respectively.
2021 | ||||||||||||||||||||
Remaining Contractual Maturity of the Agreements | ||||||||||||||||||||
Reverse | Overnight and | Up to 30 days | 30–90 days | Greater Than | Total | |||||||||||||||
Collateralized Loan Obligations | $ | — | $ | — | $ | 6,833,000 | $ | — | $ | 6,833,000 | ||||||||||
Total | $ | — | $ | — | $ | 6,833,000 | $ | — | $ | 6,833,000 |
62
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Repurchase Offers
The Fund is a closed-end investment company structured as an interval fund and, as such, has adopted a fundamental policy to make quarterly repurchase offers, at per-class NAV, of not less than 5% of the Fund’s outstanding Shares on the repurchase request deadline. The Fund will offer to purchase only a small portion of its Shares each quarter, and there is no guarantee that shareholders will be able to sell all of the Shares that they desire to sell in any particular repurchase offer. Under current regulations, such offers must be for not less than 5% nor more than 25% of the Fund’s Shares outstanding on the repurchase request deadline. If a repurchase offer is oversubscribed, the Fund may repurchase only a pro rata portion of the Shares tendered by each shareholder. The potential for proration may cause some investors to tender more Shares for repurchase than they wish to have repurchased or result in investors being unable to liquidate all or a given percentage of their investment during in the particular repurchase offer.
Borrowing, Use of Leverage
On March 12, 2020, CCLF SPV LLC, entered into a secured revolving credit facility (the “Facility”), pursuant to a Loan and Servicing Agreement with Massachusetts Mutual Life Insurance Company as the initial lender and other lenders from time to time as parties thereto (the “Lenders”), the Fund, Cortland Capital Market Services LLC as the Administrative Agent and Collateral Custodian and other parties. As of December 31, 2021, the Facility provides for borrowings on a committed basis in an aggregate principal amount up to $1,500,000,000, which amount may be increased from time to time upon mutual agreement by the Lenders and CCLF SPV secured by the Fund’s equity interest in CCLF SPV and by CCLF SPV’s assets. In connection with the Facility, CCLF SPV has made certain customary representations and warranties and is required to comply with various customary covenants, reporting requirements and other requirements. The Facility contains events of default customary for similar financing transactions, including: (i) the failure to make principal, interest or other payments when due after the applicable grace period; (ii) the insolvency or bankruptcy of CCLF SPV or the Fund; (iii) a change of control of CCLF SPV; or (iv) a change of management of the Fund. Upon the occurrence and during the continuation of an event of default, the Lenders may declare the outstanding advances and all other obligations under the Facility immediately due and payable. For the year ended December 31, 2021, the average balance outstanding, interest rate at year end, and weighted average interest rate were $499,000,000, 2.63% and 2.72%, respectively. The interest expense during the year ended December 31, 2021 was $13,547,381. Commitment fees incurred are prepaid and amortized over the term of the loan. For the year ended December 31, 2021, fees were $553,261.
Certain Fund investments are held by CCLF SPV. The use of leverage increases both risk of loss and profit potential. The Fund is subject to the Investment Company Act requirement that an investment company satisfy an asset coverage requirement of 300% of its indebtedness, including amounts borrowed (including through one or more SPVs that are wholly-owned subsidiaries of the Fund), measured at the time the investment company incurs the indebtedness. This means that at any given time the value of the Fund’s total indebtedness may not exceed one-third the value of its total assets (including such indebtedness). The interests of persons with whom the Fund (or SPVs that are wholly-owned subsidiaries of the Fund) enters into leverage arrangements will not necessarily be aligned with the interests of the Fund’s shareholders and such persons will have claims on the Fund’s assets that are senior to those of the Fund’s shareholders. In addition to the risks created by the Fund’s use of leverage, the Fund is subject to the additional risk that it would be unable to timely, or at all, obtain leverage borrowing. The Fund might also be required to de-leverage, selling securities at a potentially inopportune time and incurring tax consequences. Further, the Fund’s ability to generate income from the use of leverage would be adversely affected.
Secured Borrowings
From time to time, the Fund may engage in sale/buy-back agreements, which are a type of secured borrowing. The amount, interest rate and terms of these agreements will be individually negotiated on a transaction-by-transaction basis. Each borrowing is secured by an interest in an underlying asset which is participated or assigned to the sale/buy-back counter party for the duration of the agreement.
On October 27, 2021 and December 20, 2021, the Fund entered into sale/buy-back agreements with Macquarie US Trading LLC (“Macquarie”), and pursuant to such agreements, the Fund assigned certain assets to Macquarie, with a corresponding repurchase obligation at an agreed-upon price within 120 days after the sale date (the “Macquarie Sale/Buy-Back”). The Macquarie Sale/Buy-Back has a funding cost of 0.8904 bps per day and is not subject to any additional fees. As of December 31, 2021, secured borrowings pursuant to the Macquarie Sale/Buy-Back were $102,503,317 with a maturity of 30-90 days and $147,486,913 with a maturity of greater than 90 days. Interest expense on secured borrowings for the year ended December 31, 2021 were $770,526. Secured borrowings outstanding as of December 31, 2021 with Macquarie were as follows:
63
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
2. Significant Accounting Policies (continued)
Loan Name | Trade Date | Maturity Date | Amount | |||||||||
Follett School Solutions | October 27, 2021 | February 24, 2022 | $ | 18,021,818 | ||||||||
MC Group Ventures Corporation | October 27, 2021 | February 24, 2022 | 15,039,231 | |||||||||
MC Group Ventures Corporation | October 27, 2021 | February 24, 2022 | 4,994,231 | |||||||||
PDQ | October 27, 2021 | February 24, 2022 | 10,634,118 | |||||||||
The Vertex Companies, Inc. and TWD Vertex Acquisition, LLC | October 27, 2021 | February 24, 2022 | 9,586,956 | |||||||||
GovBrands Intermediate, Inc. | October 27, 2021 | February 24, 2022 | 8,628,840 | |||||||||
Gainsight Inc. | October 27, 2021 | February 24, 2022 | 14,737,500 | |||||||||
Diligent Corporation and Diligent Sterling, LLC | October 27, 2021 | February 24, 2022 | 4,334,220 | |||||||||
Diligent Corporation and Diligent Sterling, LLC | October 27, 2021 | February 24, 2022 | 5,921,643 | |||||||||
GS AcquisitionCo, Inc | October 27, 2021 | February 24, 2022 | 10,604,760 | |||||||||
Total | $ | 102,503,317 |
Loan Name | Trade Date | Maturity Date | Amount | |||||||||
GS AcquisitionCo, Inc. | December 20, 2021 | April 19, 2022 | $ | 9,176,305 | ||||||||
Cleo Communications Holding, LLC | December 20, 2021 | April 19, 2022 | 12,806,043 | |||||||||
VRC Companies, LLC | December 20, 2021 | April 19, 2022 | 18,329,062 | |||||||||
Patriot Growth Insurance Services, LLC | December 20, 2021 | April 19, 2022 | 13,607,830 | |||||||||
Iconic Purchaser Corporation | December 20, 2021 | April 19, 2022 | 16,082,051 | |||||||||
Ranger Buyer, Inc. | December 20, 2021 | April 19, 2022 | 22,846,154 | |||||||||
Inovalon Holdings, Inc. | December 20, 2021 | April 19, 2022 | 12,316,898 | |||||||||
ERC Holdings, LLC | December 20, 2021 | April 19, 2022 | 14,879,290 | |||||||||
Trunk Acquisition, Inc. | December 20, 2021 | April 19, 2022 | 22,275,000 | |||||||||
Woof Holdings, Inc. | December 20, 2021 | April 19, 2022 | 5,168,280 | |||||||||
Total | $ | 147,486,913 |
3. Principal Risks
Non-Diversified Status
The Fund is a “non-diversified” management investment company. Thus, there are no percentage limitations imposed by the Investment Company Act on the Fund’s assets that may be invested, directly or indirectly, in the securities of any one issuer. Consequently, if one or more securities are allocated a relatively large percentage of the Fund’s assets, losses suffered by such securities could result in a higher reduction in the Fund’s capital than if such capital had been more proportionately allocated among a larger number of securities. The Fund may also be more susceptible to any single economic or regulatory occurrence than a diversified investment company.
Multi-Manager Risk
Fund performance is dependent upon the success of the Investment Manager and the Sub-Advisers in implementing the Fund’s investment strategies in pursuit of its investment objectives. To a significant extent, the Fund’s performance will depend on the success of the Investment Manager’s methodology in allocating the Fund’s assets to the Sub-Advisers and its selection and oversight of the Sub-Advisers. The Sub-Advisers selected by the Investment Manager may underperform the market generally or other sub-advisers that could have been selected for the Fund. The Sub-Advisers’ investment styles may
64
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
3. Principal Risks (continued)
not always be complementary, which could adversely affect the performance of the Fund. In addition, the Sub-Advisers and Investment Manager invest independently of each other and may pursue investment strategies that “compete” with each other for investment opportunities, which could have the result of increasing an investment’s cost.
LIBOR Risk
LIBOR has been used extensively in the U.S. and globally as a “benchmark” or “reference rate” for various commercial and financial contracts, including corporate and municipal bonds, bank loans, asset-backed and mortgage-related securities, interest rate swaps and other derivatives. Instruments in which the Fund invests may have historically paid interest at floating rates based on LIBOR or may have been subject to interest caps or floors based on LIBOR. The Fund and issuers of instruments in which the Fund invests may have also historically obtained financing at floating rates based on LIBOR. The underlying collateral of CLOs in which the Fund invests have also paid interest at floating rates based on LIBOR. In July of 2017, the head of the UK Financial Conduct Authority (“FCA”) announced a desire to phase out the use of LIBOR by the end of 2021. On March 5, 2021, ICE announced that all LIBOR settings will either cease to be provided by any administrator or no longer be representative: (a) immediately after December 31, 2021, in the case of the 1-week and 2-month U.S. dollar LIBOR settings; and (b) immediately after June 30, 2023, in the case of the remaining U.S. dollar LIBOR settings.
On July 29, 2021, the U.S. Federal Reserve, in connection with the Alternative Reference Rates Committee (“ARRC”), a steering committee comprised of large U.S. financial institutions, formally recommended the forward-looking Secured Overnight Financing Rate (“SOFR”) term rates proposed by CME Group, Inc. as the replacement for U.S. dollar LIBOR, marking the final step in the ARRC’s Paced Transition Plan implemented to encourage the adoption of SOFR. In addition, as of the date of this prospectus, the current nominated replacement for GBP-LIBOR is the Sterling Overnight Interbank Average Rate (“SONIA”). In July 2020, Bloomberg began publishing fall-backs that the International Swaps and Derivatives Association (“ISDA”) intends to implement in lieu of LIBOR with respect to swaps and derivatives. Given the inherent differences between LIBOR and SOFR, or any other alternative Benchmark Rate that may be established, including SONIA, there remains uncertainty regarding the future utilization of LIBOR and the nature of any replacement rate. In many cases, the nominated replacements, as well as other potential replacements, are not complete or ready to implement and require margin adjustments. There is currently no final consensus as to which Benchmark Rate(s) (along with any adjustment and/or permutation thereof) will replace all or any LIBOR tenors after the discontinuation thereof and there can be no assurance that any such replacement Benchmark Rate(s) will attain market acceptance.
Any transition away from LIBOR to one or more alternative Benchmark Rates is complex and could have a material adverse effect on the Fund’s business, financial condition and results of operations, including, without limitation, as a result of any changes in the pricing and/or availability of the Fund’s investments, negotiations and/or changes to the documentation for certain of the Fund’s investments, the pace of such changes, disputes and other actions regarding the interpretation of current and prospective loan documentation, basis risks between investments and hedges, basis risks within investments (e.g., securitizations), costs of modifications to processes and systems, and/or costs of administrative services and operations, including monitoring of recommended conventions and Benchmark Rates, or any component of or adjustment to the foregoing.
It is not possible to predict whether there will be any further changes in the methods pursuant to which the LIBOR rates are determined and any other reforms to LIBOR that will be enacted in the United States, the U.K. or elsewhere, or the effects thereof. Any such changes or further reforms to LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR rates, which could have a material adverse impact on the value of the Fund’s investments and any payments linked to LIBOR thereunder.
LIBOR is likely to perform differently than in the past until the final phase-outs in 2023 and, ultimately, cease to exist as a global benchmark going forward. Until an alternative Benchmark Rate(s) becomes generally accepted and regularly implemented in the market, the uncertainty as to the future of LIBOR, its eventual phase-out, the transition to one or more alternate Benchmark Rate(s), and the implementation of such new Benchmark Rate(s) may impact a number of factors, which, either alone or in the aggregate, may cause a material adverse effect on the Fund’s performance and ability to achieve its investment objective. Such factors include, without limitation: (i) the administration and/or management of portfolio of investments, including (a) cost of funding or other operational or administrative costs, (b) costs incurred to transition to and implement a substitute index or Benchmark Rate(s) for purposes of calculating interest, (c) costs of negotiating with counterparties with respect to an acceptable replacement calculation and potential amendments to existing debt instruments or credit facilities currently utilizing LIBOR to determine interest rates, and/or (d) costs of potential disputes and/or litigation regarding interest calculation, loan value, appropriateness or comparability of any new Benchmark Rate(s) or any other dispute over terms relating to or arising from any of the foregoing; (ii) the availability (or lack thereof) of potential investments in the market
65
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
3. Principal Risks (continued)
during the transition period; (iii) the time periods necessary to make investments and deploy capital during the transition period; (iv) the calculation and value of investments and overall cash flows, profitability and performance; (v) the liquidity of investments in the secondary market or otherwise, and the asset-liability management strategies available; (vi) basis risks between investments and hedges and basis risks within investments (e.g., securitizations); or (vii) any mismatch, during a transition period or otherwise, between a Benchmark Rate used for leverage facilities and another used for one or more of the Fund’s investments.
Limited Liquidity
Shares in the Fund provide limited liquidity since shareholders will not be able to redeem Shares on a daily basis. A shareholder may not be able to tender its Shares in the Fund promptly after it has made a decision to do so. In addition, with very limited exceptions, Shares are not transferable, and liquidity will be provided only through repurchase offers made quarterly by the Fund. In addition, the Fund does not expect any trading market to develop for the Shares. As a result, if investors decide to invest in the Fund, they will have very limited opportunity to sell their Shares. Shares in the Fund are therefore suitable only for investors who can bear the risks associated with the limited liquidity of Shares and should be viewed as a long-term investment.
Pandemic Risk
The continuing spread of an infectious respiratory illness caused by a novel strain of coronavirus (known as COVID-19) has caused volatility, severe market dislocations and liquidity constraints in many markets, including securities the Fund holds, and may adversely affect the Fund’s investments and operations. The outbreak was first detected in December 2019 and subsequently spread globally, and since then, the number of cases has fluctuated and new “variants” have been confirmed around the world. The transmission of COVID-19 and efforts to contain its spread have resulted in international and domestic travel restrictions and disruptions, closed international borders, enhanced health screenings at ports of entry and elsewhere, disruption of and delays in healthcare service preparation and delivery, quarantines, event and service cancellations or interruptions, disruptions to business operations (including staff reductions), supply chains and consumer activity, as well as general concern and uncertainty that has negatively affected the economic environment. These disruptions have led to instability in the market-place, including stock and credit market losses and overall volatility. The impact of COVID-19, and other infectious illness outbreaks, epidemics or pandemics that may arise in the future, could adversely affect the economies of many nations or the entire global economy, the financial performance of individual issuers, borrowers and sectors and the health of the markets generally in potentially significant and unforeseen ways. In addition, the impact of infectious illnesses, such as COVID-19, in emerging market countries may be greater due to generally less established healthcare systems. This crisis or other public health crises may exacerbate other pre-existing political, social and economic risks in certain countries or globally.
The Fund, the Investment Manager and Sub-Advisers have in place business continuity plans reasonably designed to ensure that they maintain normal business operations, and that the Fund, its portfolio and assets are protected. However, in the event of a pandemic or an outbreak, such as COVID-19, there can be no assurance that the Fund, its advisers and service providers, or the Fund’s portfolio companies, will be able to maintain normal business operations for an extended period of time or will not lose the services of key personnel on a temporary or long-term basis due to illness or other reasons. A pandemic or disease could also impair the information technology and other operational systems upon which the Fund’s advisers rely and could otherwise disrupt the ability of the Fund’s service providers to perform essential tasks.
The foregoing has led to a recession in most developed countries in the world, and it could lead to increased market volatility, a greater number of market closures, higher default rates and adverse effects on the values and liquidity of securities or other assets. Such impacts, which may vary across asset classes, may adversely affect the performance of the Fund’s investments, the Fund and your investment in the Fund. In certain cases, an exchange or market may close or issue trading halts on either specific securities or even the entire market, which may result in the Fund being, among other things, unable to buy or sell certain securities or financial instruments or to accurately price its investments.
Governmental authorities and regulators throughout the world, such as the U.S. Federal Reserve, have in the past responded to major economic disruptions with changes to fiscal and monetary policy, including but not limited to, direct capital infusions, new monetary programs and dramatically lower interest rates. Certain of those policy changes have been and continue to be implemented in response to the COVID-19 pandemic. Such policy changes may adversely affect the value, volatility and liquidity of dividend and interest paying securities. The effect of recent efforts undertaken by the U.S. Federal Reserve to address the economic impact of the COVID-19 pandemic, such as the reduction of the federal funds target rate, and other
66
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
3. Principal Risks (continued)
monetary and fiscal actions that may be taken by the U.S. federal government to stimulate the U.S. economy, are not yet fully known. Although vaccines are becoming more widely available, the duration of the COVID-19 outbreak and its full impacts are unknown and the pace of recovery may vary from market to market, resulting in a high degree of uncertainty for potentially extended periods of time, especially in certain sectors in which the Fund may make investments.
4. Investment Advisory and Other Agreements
The Fund has entered into an investment management agreement (the “Investment Management Agreement”) with the Investment Manager. Pursuant to the Investment Management Agreement, the Fund pays the Investment Manager a monthly Investment Management Fee equal to 1.00% on an annualized basis of the Fund’s Net Assets. The Investment Manager has contractually agreed to an expense limitation and reimbursement agreement (the “Expense Limitation and Reimbursement Agreement”) with the Fund, whereby the Investment Manager has agreed to waive fees that it would otherwise have been paid, and/or to assume expenses of the Fund (a “Waiver”), if required to ensure the Total Annual Expenses (excluding any taxes, leverage interest, distribution and servicing fees, brokerage commissions, dividend and interest expenses on short sales, acquired fund fees and expenses (as determined in accordance with SEC Form N-2), expenses incurred in connection with any merger or reorganization, and extraordinary expenses, such as litigation expenses) do not exceed 2.25% of the average daily net assets of Class I Shares (the “Expense Limit”). For a period not to exceed three years from the date on which a Waiver is made, the Investment Manager may recoup amounts waived or assumed, provided it is able to effect such recoupment and remain in compliance with the Expense Limitation and Reimbursement Agreement. The Expense Limitation and Reimbursement Agreement has an initial two-year term, which ends two years from the date of commencement of the Fund’s operations. The Expense Limitation and Reimbursement Agreement will automatically renew for consecutive one-year terms thereafter.
The Fund uses a “multi-manager” approach whereby the Fund’s assets are allocated amongst the Investment Manager and one or more sub-advisers in percentages determined at the discretion of the Investment Manager (“allocated portion”). Pursuant to separate sub-advisory agreements, the Fund has agreed to pay Audax Management Company (NY), LLC a monthly sub-advisory fee, on an annualized basis, of (i) 0.95% on the value of the allocated portion’s average daily assets for the first fifty million dollars ($50,000,000), (ii) 0.85% on the value of the allocated portion’s average daily assets that exceeds fifty million dollars ($50,000,000) up to one hundred million dollars ($100,000,000), and (iii) 0.65% on the value of the allocated portion’s average daily assets that exceeds one hundred million dollars ($100,000,000). On September 30, 2021, Audax Management Company (NY), LLC was terminated as sub-advisor to the Fund. The portfolio management fees paid to Crescent Capital Group LP (“Crescent Capital”) are 1.00% on an annualized basis of the allocated portion of the Fund’s average daily assets managed by Crescent Capital and are paid monthly. The portfolio management fees paid to BlackRock Capital Investment Advisors (“BlackRock”) will be 1.00% on an annualized basis of the allocable portion of the Fund’s average daily assets managed by BlackRock.
For a period not to exceed three years from the date on which advisory fees are waived or Fund expenses were absorbed by the Investment Manager, the Investment Manager may recoup amounts waived or absorbed, provided it is able to effect such recoupment and remain in compliance with (a) the limitation on Fund expenses in effect at the time of the relevant reduction in advisory fees or payment of the Fund’s expenses, and (b) the limitation on Fund expenses at the time of the recoupment. At December 31, 2021 the amount of these potentially recoverable expenses is $490,297 expiring on December 31, 2022. For the year ended December 31, 2021, the Investment Manager did not recover any previously waived expenses.
Foreside Fund Services, LLC serves as the Fund’s distributor; UMB Fund Services, Inc. (“UMBFS”) serves as the Fund’s fund accountant, transfer agent and administrator. For the year ended December 31, 2021, the Fund’s allocated UMBFS fees are reported on the consolidated Statement of Operations.
An officer of the Fund is an employee of UMBFS. The Fund does not compensate officers affiliated with the Fund’s administrator. For the year ended December 31, 2021, the Fund’s allocated fees incurred for trustees who are not affiliated with the Fund’s administrator are reported on the consolidated Statement of Operations.
Vigilant Compliance, LLC provides Chief Compliance Officer (“CCO”) services to the Fund. The Fund’s allocated fees incurred for CCO services for the year ended December 31, 2021, are reported on the consolidated Statement of Operations.
67
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
5. Fair Value of Investments
Fair value – Definition
The Fund uses a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The objective of a fair value measurement is to determine the price 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 (an exit price). Accordingly, the fair value hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:
● | Level 1 – Valuations based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. |
● | Level 2 – Valuations based on inputs, other than quoted prices included in Level 1, that are observable either directly or indirectly. |
● | Level 3 – Valuations based on inputs that are both significant and unobservable to the overall fair value measurement. |
Investments in Private Investment Funds measured based upon Net Asset Value (“NAV”) as a practical expedient to determine fair value are not required to be categorized in the fair value hierarchy.
The availability of valuation techniques and observable inputs can vary from investment to investment and are affected by a wide variety of factors, including type of investment, whether the investment is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, determining fair value requires more judgment. Because of the inherent uncertainly of valuation, estimated values may be materially higher or lower than the values that would have been used had a ready market for the investments existed. Accordingly, the degree of judgment exercised by the Investment Manager in determining fair value is greatest for investments categorized in Level 3.
The Fund’s assets recorded at fair value have been categorized based on a fair value hierarchy as described in the Fund’s significant accounting policies. The following table presents information about the Fund’s assets and liabilities measured at fair value as of December 31, 2021:
Assets | Level 1 | Level 2 | Level 3 | Net Asset | Total | |||||||||||||||
Investments, at fair value | ||||||||||||||||||||
Senior Secured Loans | $ | — | $ | 66,400,591 | $ | 4,588,192,457 | $ | — | $ | 4,654,593,048 | ||||||||||
Private Investment Vehicles | — | — | 1,857,735 | 1,945,133,552 | 1,946,991,287 | |||||||||||||||
Collateralized Loan Obligations | — | 79,356,890 | 18,045,328 | — | 97,402,218 | |||||||||||||||
Preferred Stocks | — | — | 30,032,779 | — | 30,032,779 | |||||||||||||||
Subordinated Debt | — | — | 15,450,000 | — | 15,450,000 | |||||||||||||||
Common Stocks | — | — | 5,081,224 | — | 5,081,224 | |||||||||||||||
Warrants | — | — | 1,152,261 | — | 1,152,261 | |||||||||||||||
Short-Term Investments | 55,878,712 | — | — | — | 55,878,712 | |||||||||||||||
Total Investments, at fair value | $ | 55,878,712 | $ | 145,757,481 | $ | 4,659,811,784 | $ | 1,945,133,552 | $ | 6,806,581,529 | ||||||||||
Other Financial Instruments1 | ||||||||||||||||||||
Forward Contracts | $ | — | $ | 523,672 | $ | — | $ | — | $ | 523,672 | ||||||||||
Total Assets | $ | 55,878,712 | $ | 146,281,153 | $ | 4,659,811,784 | $ | 1,945,133,552 | $ | 6,807,105,201 | ||||||||||
68
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
5. Fair Value of Investments (Continued)
Assets | Level 1 | Level 2 | Level 3 | Net Asset | Total | |||||||||||||||
Liabilities |
|
|
|
|
| |||||||||||||||
Investments, at fair value | ||||||||||||||||||||
Reverse Repurchase Agreement | $ | — | $ | 6,833,000 | $ | — | $ | — | $ | 6,833,000 | ||||||||||
Other Financial Instruments1 | ||||||||||||||||||||
Forward Contracts | — | 1,865,342 | — | — | 1,865,342 | |||||||||||||||
Total Liabilities, at fair value | $ | — | $ | 8,698,342 | $ | — | $ | — | $ | 8,698,342 |
1 | Other financial instruments are derivative instruments such as futures contracts, forward contracts and swap contracts. Futures contracts, forward contracts and swap contracts are valued at the unrealized appreciation (depreciation) on the instrument. |
The following table presents the changes in assets and transfers in and out for investments that are classified in Level 3 of the fair value hierarchy for the year ended December 31, 2021:
Senior | Private | Collateralized | Preferred | Subordinated | ||||||||||||||||
Balance as of January 1, 2021 | $ | 709,359,963 | $ | 6,766,715 | $ | 92,373,408 | $ | — | $ | — | ||||||||||
Purchases | 4,639,618,008 | — | — | 30,013,004 | 15,450,000 | |||||||||||||||
Sales/Paydowns | (747,835,299 | ) | (7,717,706 | ) | (9,850,000 | ) | — | — | ||||||||||||
Realized gains (losses)1 | 5,725,022 | 7,024,192 | — | — | — | |||||||||||||||
Original issue discount and amendment fees | (11,624,161 | ) | 186,431 | — | — | — | ||||||||||||||
Accretion | 3,111,599 | — | 183,613 | — | — | |||||||||||||||
Change in Unrealized appreciation (depreciation) | 5,312,186 | (4,401,897 | ) | 3,615,663 | 19,775 | — | ||||||||||||||
Transfers In | — | — | — | — | — | |||||||||||||||
Transfers Out2 | (15,474,861 | ) | — | (68,277,356 | ) | — | — | |||||||||||||
Balance as of December 31, 2021 | $ | 4,588,192,457 | $ | 1,857,735 | $ | 18,045,328 | $ | 30,032,779 | $ | 15,450,000 |
Warrants | Common | Total | ||||||||||
Balance as of January 1, 2021 | $ | — | $ | — | $ | 808,500,086 | ||||||
Purchases | 1,152,261 | 4,365,607 | 4,690,598,880 | |||||||||
Sales/Paydowns | — | — | (765,403,005 | ) | ||||||||
Realized gains (losses) | — | — | 12,749,214 | |||||||||
Original issue discount and amendment fees | — | — | (11,437,730 | ) | ||||||||
Accretion | — | — | 3,295,212 | |||||||||
Change in Unrealized appreciation (depreciation) | — | 715,617 | 5,261,344 | |||||||||
Transfers In | — | — | — | |||||||||
Transfers Out | — | — | (83,752,217 | ) | ||||||||
Balance as of December 31, 2021 | $ | 1,152,261 | $ | 5,081,224 | $ | 4,659,811,784 |
1 | Senior Secured Loans includes paydown gains (losses) of $5,530,011. |
2 | Transferred from Level 3 to Level 2 because observable market data became available for the investments. |
69
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
5. Fair Value of Investments (Continued)
The following table summarizes the valuation techniques and significant unobservable inputs used for the Fund’s investments that are categorized in Level 3 of the fair value hierarchy as of December 31, 2021.
Investments | Fair Value | Valuation | Unobservable | Range of | Impact on | |||
Collateralized Loan Obligations | $ | 18,045,328 | Income approach | Interest Rate/ Discount Margin | 6.65% - 14.00% | Decrease | ||
Default Rate | 3 CDR | Decrease | ||||||
Recovery Rate | 60% | Increase | ||||||
Term | Maturity, or Reinvestment +24 months | Decrease | ||||||
Prepayment Assumptions | 25 CPR | Increase | ||||||
Reinvestment Assumptions | $98.50 | Decrease | ||||||
Common Stocks | 4,328,128 | Market approach | Public Company Comparison - LTM Revenue Multiple | 4.39x | Increase | |||
653,096 | Market approach | Public Company Comparison - LTM EBITDA Multiple | 7.0x | Increase | ||||
100,000 | Cost | Recent Transaction Price | N/A | N/A | ||||
Preferred Stocks | 18,777,779 | Income approach | Discount Rate | 14.07% - 16.53% | Decrease | |||
11,255,000 | Cost | Recent Transaction Price | N/A | N/A | ||||
Private Investment Vehicles | 1,857,735 | Income approach | Weighted Average Cost of Capital | 15.00% | Decrease | |||
Senior Secured Loans | 1,411,487,094 | Income approach | Discount Rate | 4.35% - 11.86% | Decrease | |||
LTM Revenue ($ Millions) | $19 - $3,016 | Increase | ||||||
Debt/EBITDA | 0.81x — 20.10x | Decrease | ||||||
Interest Coverage | 0.85x — 49.14x | Increase | ||||||
3,176,705,363 | Cost | Recent Transaction Price | N/A | N/A | ||||
Subordinated Debt | 15,450,000 | Cost | Recent Transaction Price | N/A | N/A | |||
Warrants | 1,152,261 | Cost | Recent Transaction Price | N/A | N/A | |||
$ | 4,659,811,784 |
70
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
6. Capital Stock
The Fund is authorized as a Delaware statutory trust to issue an unlimited number of Shares in one or more classes, with a par value of $0.001. The minimum initial investment in Class I Shares by any investor is $10 million. However, the Fund, in its sole discretion, may accept investments below this minimum with respect to Class I Shares. Shares may be purchased by principals and employees of the Investment Manager or its affiliates and their immediate family members without being subject to the minimum investment requirements.
Class I Shares will not be subject to any initial sales charge. Shares will generally be offered for purchase on each business day at NAV per share, except that Shares may be offered more or less frequently as determined by the Board in its sole discretion. The Board may also suspend or terminate offerings of Shares at any time.
A shareholder whose Shares (or a portion thereof) are repurchased by the Fund will not be entitled to a return of any sales charge that was charged in connection with the shareholder’s purchase of the Shares.
Pursuant to Rule 23c-3 under the Investment Company Act, on a quarterly basis, the Fund offers shareholders holding all classes of shares the option of redeeming shares at NAV. The Board determines the quarterly repurchase offer amount (“Repurchase Offer Amount”), which can be no less than 5% and no more than 25% of all shares of all classes outstanding on the repurchase request deadline. If shareholders tender more than the Repurchase Offer Amount, the Fund may, but is not required to, repurchase an additional amount of shares not to exceed 2% of all outstanding shares of the Fund on the repurchase request deadline If the Fund determines not to repurchase more than the Repurchase Offer Amount, or if shareholders tender Shares in an amount exceeding the Repurchase Offer Amount plus 2% of the outstanding Shares on the Repurchase Request Deadline, the Fund will repurchase the Shares on a pro rata basis. However, the Fund may accept all shares tendered for repurchase by shareholders who own less than $2,500 worth of Shares and who tender all of their Shares, before prorating other amounts tendered. In addition, the Fund will accept the total number of Shares tendered in connection with required minimum distributions from an IRA or other qualified retirement plan. It is the shareholder’s obligation to both notify and provide the Fund supporting documentation of a required minimum distribution from an IRA or other qualified retirement plan. The results of the repurchase offers conducted for the year ended December 31, 2021 are as follows:
Commencement Date | January 8, 2021 | April 7, 2021 | July 7, 2021 | October 6, 2021 | ||||||||||||
Repurchase Request | February 11, 2021 | May 7, 2021 | August 6, 2021 | November 5, 2021 | ||||||||||||
Repurchase Pricing date | February 11, 2021 | May 7, 2021 | August 6, 2021 | November 5, 2021 | ||||||||||||
Net Asset Value as of Repurchase Offer Date | ||||||||||||||||
Class I | $ | 10.45 | $ | 10.71 | $ | 10.68 | $ | 10.73 | ||||||||
Amount Repurchased | ||||||||||||||||
Class I | $ | 10,345,765 | $ | 25,558,040 | $ | 78,796,899 | $ | 41,797,819 | ||||||||
Percentage of Outstanding Shares Repurchased | ||||||||||||||||
Class I | 1.10 | % | 1.52 | % | 2.98 | % | 1.07 | % |
7. Federal Income Taxes
Fund Income Tax
At December 31, 2021, gross unrealized appreciation and depreciation on investments, based on cost for federal income tax purposes were as follows:
Cost of investments including proceeds from reverse repurchase agreements | $ | 6,743,163,234 | ||
Gross unrealized appreciation | 70,018,210 | |||
Gross unrealized depreciation | (13,432,915 | ) | ||
Net unrealized appreciation on investments | $ | 56,585,295 |
71
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
7. Federal Income Taxes (Continued)
The difference between cost amounts for financial statement and federal income tax purposes is due primarily to timing differences in recognizing certain gains and losses in security transactions.
GAAP requires that certain components of net assets be reclassified between financial and tax reporting. These reclassifications have no effect on net assets or NAV per share. For the year ending December 31, 2021, permanent differences in book and tax accounting reclassified between paid-in capital and total distributable earnings were as follows:
Increases/(Decrease) | |
Capital | Total Distributable |
$408,676 | $(408,676) |
As of December 31, 2021, the components of distributable earnings on a tax basis were as follows:
Undistributed ordinary income | $ | — | ||
Undistributed long-term capital gains | — | |||
Accumulated capital and other losses | — | |||
Unrealized appreciation/(depreciation) | ||||
Investments | 56,585,294 | |||
Foreign Currency | (62,219 | ) | ||
Organizational costs | (41,312 | ) | ||
Total distributable earnings | $ | 56,481,763 |
The tax character of distributions paid during the fiscal years ended December 31, 2021 and December 31, 2020 were as follows:
2021 | 2020 | |||||||
Distribution paid from: | ||||||||
Ordinary income | $ | 165,497,728 | $ | 31,816,599 | ||||
Return of Capital | 28,307,888 | 4,439,794 | ||||||
Net long-term capital gains | 7,900,814 | 1,478 | ||||||
Total distributions paid | $ | 201,706,430 | $ | 36,257,871 |
Domestic Blocker Income Tax
The CCLF Holdings LLC (the “Domestic Blocker”) recorded a provision for income tax expense (benefit) for the year ended December 31, 2021, in the amount of $349,434. This provision for income tax expense (benefit) is comprised of the following current and deferred income tax expense (benefit):
Current | $ | 348,278 | ||
Deferred | 1,156 |
As of December 31, 2021, temporary differences between financial and tax reporting that give rise to deferred income taxes totaled $349,434, resulting principally from differences in the recognition of income from partnership investments and the treatment of unrealized appreciation/depreciation. The Domestic Blocker has a net deferred tax liability recorded as of December 31, 2021. Should a net deferred tax asset exist in the future, the Domestic Blocker will assess whether a valuation allowance should be booked to reserve against that asset.
The statutory rate and effective federal rate is 21%. The Fund is currently using an estimated tax rate of 3.95% for state and local tax, net of federal tax benefit.
72
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
8. Investment Transactions
For the year ended December 31, 2021, purchases and sales of investments, excluding short-term investments, were $6,596,620,140 and $826,685,580, respectively.
9. Indemnifications
In the normal course of business, the Fund enters into contracts that contain a variety of representations which provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, the Fund expects the risk of loss to be remote.
10. Derivatives and Hedging Disclosures
U.S. GAAP requires enhanced disclosures about the Fund’s derivative and hedging activities, including how such activities are accounted for and their effects on the Fund’s financial position, performance and cash flows. The Fund invested in forward foreign exchange currency contracts for the year ended December 31, 2021 in order to hedge overall portfolio currency risk. By entering into these contracts, the Fund agrees to exchange different currencies at a specified exchange rate at an agreed-upon future date. The Fund may be susceptible to the risk of changes in the foreign exchange rate underlying the forward contract and of the counterparty’s potential inability to fulfill the terms of the contract.
The effects of these derivative instruments on the Fund’s financial position and financial performance as reflected in the Consolidated Statements of Assets and Liabilities and Consolidated Statements of Operations are presented in the tables below. The fair values of derivative instruments as of December 31, 2021, and the realized and unrealized gain (loss) during the year ended December 31, 2021 by risk category are as follows:
Asset | Liability | ||||||||
Statement of Asset and Liabilities Location | Derivatives not designated as | Value | Value | ||||||
Net unrealized depreciation on forward contracts | Forward Contracts | $ | 523,672 | $ | 1,865,342 | ||||
Total | $ | 523,672 | $ | 1,865,342 |
Amount of Net Realized Gain or (Loss) on Derivatives Recognized in Income | ||||||||
Derivatives not designated as hedging instruments | Forward | Total | ||||||
Foreign Exchange Contracts | $ | 4,120,659 | $ | 4,120,659 |
Net Change in Unrealized Appreciation/Depreciation on Derivatives Recognized in Income | ||||||||
Derivatives not designated as hedging instruments | Forward | Total | ||||||
Foreign Exchange Contracts | $ | (772,170 | ) | $ | (772,170 | ) |
The quarterly average volumes of derivative instruments as of December 31, 2021 are as follows:
Derivatives not designated as hedging instruments | Short Forward | |||
Foreign Exchange Contracts | 12 |
73
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
11. Joint Ventures
Middle Market Credit Fund II, LLC
In November 2020, TCG BDC, Inc. and CCLF formed a joint venture, Middle Market Credit Fund II, LLC ( “MMCF II”), that invests primarily in senior secured loans, and to a lesser extent, mezzanine loans, unsecured loans and equity of predominately private U.S. middle market companies. Middle market companies are defined as those with annual revenues up to $1 billion, although MMCF II may invest in larger or smaller companies. It may also purchase interests in loans or corporate bonds through secondary market transactions. MMCF II invests in portfolio companies in the same industries in which CCLF may directly invest. MMCF II was formed as a Delaware limited liability company and is not consolidated by either TCG BDC, Inc. or CCLF for financial reporting purposes. As of December 31, 2021, MMCF II had total assets of $255.0 million. MMCF II’s portfolio consisted of debt investments in 36 portfolio companies as of December 31, 2021. As of December 31, 2021, the largest investment in a single portfolio company in the MMCF II’s portfolio in aggregate principal amount was $10.0 million; and the five largest investments in portfolio companies in MMCF II totaled $47.9 million.
CCLF provides capital to MMCF II in the form of LLC equity interests. As of December 31, 2021, TCG BDC, Inc. and CCLF owned 84.13% and 15.87%, respectively, of the LLC equity interests of MMCF II. CCLF’s investment in MMCF II consisted of equity contributions of $12.5 million as of December 31, 2021.
TCG BDC, Inc. and CCLF each appointed two members to MMCF II’s four-person board of directors. All material decisions with respect to MMCF II, including those involving its investment portfolio, require unanimous approval of a quorum of the board of directors. Quorum is defined as the presence of two members of the board of directors; provided that at least one individual is present that was elected, designated or appointed by each member.
Below is a listing of MMCF II’s individual investments as of December 31, 2021 (dollar amounts in thousands):
Par/ Principal | Investments | Fair Value | ||||||
$ | 5,514 | AI Convoy S.A.R.L (United Kingdom) | $ | 5,720 | ||||
9,946 | Airnov, Inc. | 9,946 | ||||||
8,415 | American Physician Partners, LLC | 8,415 | ||||||
4,500 | AP Plastics Acquisition Holdings, LLC | 4,526 | ||||||
1,197 | Appriss Health, LLC | 1,198 | ||||||
5,357 | Apptio, Inc. | 5,357 | ||||||
5,000 | AQA Acquisition Holdings, Inc. | 5,004 | ||||||
4,355 | Aurora Lux FinCo S.Á.R.L. (Luxembourg) | 3,924 | ||||||
987 | Avenu Holdings, LLC | 987 | ||||||
3,275 | BMS Holdings III Corp. | 3,224 | ||||||
8,193 | Captive Resources Midco, LLC | 8,147 | ||||||
9,924 | Chartis Holding, LLC | 9,924 | ||||||
8,710 | Comar Holding Company, LLC | 8,536 | ||||||
8,712 | Cority Software Inc. (Canada) | 8,707 | ||||||
10,000 | Dwyer Instruments, Inc | 9,974 | ||||||
8,134 | Ethos Veterinary Health LLC | 8,134 | ||||||
8,710 | EvolveIP, LLC | 8,666 | ||||||
4,717 | Harbour Benefit Holdings, Inc. | 4,669 | ||||||
9,012 | K2 Insurance Services, LLC | 8,998 | ||||||
9,092 | Kaseya, Inc. | 9,038 | ||||||
7,980 | Material Holdings, LLC | 7,891 | ||||||
7,980 | Maverick Acquisition, Inc. | 7,808 | ||||||
8,733 | National Technical Systems, Inc. | 8,733 | ||||||
8,708 | NMI AcquisitionCo, Inc. | 8,601 |
74
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
11. Joint Ventures (Continued)
Par/ Principal | Investments | Fair Value | ||||||
$ | 4,852 | Quartz Holding Company | $ | 4,852 | ||||
8,736 | Redwood Services Group, LLC | 8,737 | ||||||
8,173 | Riveron Acquisition Holdings, Inc. | 8,173 | ||||||
8,401 | RSC Acquisition, Inc. | 8,434 | ||||||
6,875 | Superior Health Linens, LLC | 6,875 | ||||||
5,514 | Tank Holding Corp | 5,569 | ||||||
1,701 | TCFI Aevex LLC | 1,458 | ||||||
8,091 | Turbo Buyer, Inc. | 7,929 | ||||||
3,267 | US INFRA SVCS Buyer, LLC | 3,189 | ||||||
6,234 | USLS Acquisition, Inc. | 6,165 | ||||||
6,418 | Westfall Technik, Inc. | 6,359 | ||||||
5,465 | World 50, Inc. | 5,422 |
Below is certain summarized financial information for MMCF II as of December 31, 2021 (dollar amounts in thousands):
Consolidated Statement of Assets, Liabilities and Members’ Equity:
| As of | |||
ASSETS | ||||
Investments, at fair value (amortized cost of $238,615) | $ | 239,289 | ||
Cash and cash equivalents | 10,092 | |||
Interest receivable | 2,547 | |||
Receivable for investments sold/repaid | 3,059 | |||
Prepaid expenses and other assets | — | |||
Total assets | $ | 254,987 | ||
LIABILITIES AND MEMBERS’ EQUITY | ||||
Senior Notes payable, net of amortized debt issuance costs of $802 | 156,698 | |||
Interest and credit facility fees payable | 961 | |||
Distribution payable | 4,159 | |||
Other accrued expenses and liabilities | 437 | |||
Total liabilities | 162,255 | |||
Members’ equity | ||||
Members’ contributions | $ | 90,805 | ||
Members’ distributions | (1,718 | ) | ||
Accumulated income from operations | 3,645 | |||
Total members’ equity | $ | 92,732 | ||
Total liabilities and members’ equity | $ | 254,987 |
75
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
11. Joint Ventures (Continued)
Consolidated Statement of Operations:
| For the | |||
Investment income: | ||||
Interest income | $ | 18,822 | ||
Total investment income | 18,822 | |||
Expenses: | ||||
Interest expense | 4,621 | |||
Operating expenses | 814 | |||
Deferred financing fees | 122 | |||
Organization expenses | 35 | |||
Total expenses | 5,592 | |||
Net investment income | 13,230 | |||
Net change in unrealized appreciation on investments | (440 | ) | ||
Net increase in member’s equity resulting from operations | $ | 12,790 |
Commitments and Contingencies
MMCF II had outstanding commitments to fund investments totaling $157,500 under undrawn revolvers and other credit facilities as of December 31, 2021.
FBLC Senior Loan Fund, LLC
In January 2021, FBLC and Cliffwater Corporate Lending Fund (“CCLF”) formed a joint venture, FBLC Senior Loan Fund, LLC (the “Joint Venture”), that invests primarily in senior secured loans, and to a lesser extent, mezzanine loans, unsecured loans and equity of predominantly private U.S. middle-market companies. We define middle market companies as those with annual revenues up to $1 billion, although we may invest in larger or smaller companies. We also purchase interests in loans or corporate bonds through secondary market transactions. The Joint Venture was formed as a Delaware limited liability company and is not consolidated by either FBLC or CCLF for financial reporting purposes. As of December 31, 2021 the Joint Venture had total assets of $1.196 billion. The Joint Venture’s portfolio consisted of debt investments in 194 portfolio companies as of December 31, 2021. As of December 31, 2021 the largest investment in a single portfolio company in the Joint Venture’s portfolio in aggregate principal amount was $28.0 million; and the five largest investments in portfolio companies in the Joint Venture totaled $107.0 million. The Joint Venture invests in portfolio companies in the same industries in which CCLF may directly invest.
CCLF provides capital to the Joint Venture in the form of LLC equity interests. As of December 31, 2021, FBLC and CCLF owned 87.50% and 12.50%, respectively, of the LLC equity interests of the Joint Venture. CCLF’s investment in the Joint Venture consisted of equity contributions of $43.6 million as of December 31, 2021.
FBLC and CCLF each appoint two members to Proposed JV’s four-person board of directors. All material decisions with respect to the Proposed JV, including those involving its investment portfolio, require unanimous approval of a quorum of the board of directors. Quorum is defined as (i) the presence of two members of the board of directors; provided that at least one individual is present that was elected, designated or appointed by each member; (ii) the presence of three members of the board of directors; provided that the individual that was elected, designated or appointed by the member with only one individual present shall be entitled to cast two votes on each matter; and (iii) the presence of four members of the board of directors; provided that two individuals are present that were elected, designated or appointed by each member.
76
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
11. Joint Ventures (Continued)
Below is a listing of FBLC Senior Loan Fund, LLC’s individual investments as of December 31, 2021 (dollar amounts in thousands):
Par/Principal | Investments | Fair Value | ||||||
$ | 19,109,436 | ABC Financial Intermediate, LLC | $ | 19,013,888 | ||||
10,029,550 | Accentcare, Inc. | 9,976,293 | ||||||
4,232,653 | Access Cig, LLC | 4,200,146 | ||||||
28,319,039 | Acrisure, LLC | 27,965,051 | ||||||
2,000,000 | Adtalem Global Education, Inc. | 1,958,643 | ||||||
2,000,000 | Adtalem Global Education, Inc. | 2,002,920 | ||||||
7,903,226 | Advisor Group, Inc. | 7,924,644 | ||||||
15,555,423 | Alchemy US Holdco 1, LLC | 15,555,423 | ||||||
12,497,456 | Alvogen Pharma US, Inc. | 11,935,070 | ||||||
1,989,899 | Amentum Government Services Holdings, LLC | 1,956,329 | ||||||
6,316,000 | American Airlines Inc/AAdvantage Loyalty IP, Ltd. | 6,533,649 | ||||||
4,776,995 | American Rock Salt Company, LLC | 4,759,081 | ||||||
4,974,889 | AmWINS Group, Inc. | 4,933,448 | ||||||
7,466,916 | AP Gaming I, LLC | 7,409,719 | ||||||
3,244,758 | APLP Holdings, LP | 3,265,038 | ||||||
3,000,000 | Apollo Commercial Real Estate Finance, Inc. | 2,921,820 | ||||||
8,977,500 | AppLovin Corp. | 8,953,171 | ||||||
2,487,500 | Artera Services, LLC | 2,403,547 | ||||||
5,000,000 | Ascensus Holidngs, Inc. | 4,973,750 | ||||||
3,275,910 | Asp Navigate Acquisition Corp. | 3,275,910 | ||||||
1,984,672 | Astoria Energy, LLC | 1,976,495 | ||||||
3,901,981 | Astro AB Merger Sub, Inc. | 3,906,859 | ||||||
4,974,874 | Asurion, LLC | 4,937,563 | ||||||
14,232,889 | Athenahealth, Inc. | 14,218,656 | ||||||
17,770,000 | Avaya Holdings Corp. | 17,743,345 | ||||||
5,465,266 | Aveanna Healthcare, LLC | 5,432,092 | ||||||
2,730,000 | Bally’s Corp. | 2,728,853 | ||||||
12,855,183 | BBB Industries, LLC | 12,855,183 | ||||||
13,603,884 | BCP Raptor, LLC | 13,571,778 | ||||||
5,896,116 | BCP Renaissance, LLC | 5,879,548 | ||||||
2,174,000 | Beasley Mezzanine Holdings, LLC | 2,151,283 | ||||||
7,481,250 | Bella Holding Company, LLC | 7,468,756 | ||||||
7,967,481 | Blackstone CQP Holdco, LP | 7,944,216 | ||||||
12,748,207 | BMC Software Finance, Inc. | 12,658,969 | ||||||
1,921,719 | Bomgar Corp. | 1,916,223 | ||||||
20,845,321 | CareCentrix, Inc. | 20,715,038 | ||||||
1,444,811 | Clover Technologies Group, LLC | 1,368,959 | ||||||
12,914,770 | CLP Health Services, Inc. | 12,882,483 | ||||||
3,473,750 | Cnt Holdings I Corp | 3,473,125 | ||||||
7,638,840 | CommerceHub, Inc. | 7,550,535 | ||||||
9,754,574 | Community Care Health Network, LLC | 9,368,488 |
77
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
11. Joint Ventures (Continued)
Par/Principal | Investments | Fair Value | ||||||
$ | 4,777,087 | Compass Power Generation, LLC | $ | 4,753,202 | ||||
7,538,140 | Connect Finco SARL | 7,534,070 | ||||||
4,000,000 | Connectwise, LLC | 3,986,440 | ||||||
7,700,056 | Conservice Midco, LLC | 7,679,189 | ||||||
3,611,778 | CONSOL Energy, Inc. | 3,501,618 | ||||||
6,710,458 | Conterra Ultra Broadband, LLC | 6,710,458 | ||||||
7,980,000 | Corelogic, Inc. | 7,964,040 | ||||||
2,700,438 | CVENT, Inc. | 2,694,524 | ||||||
3,951,613 | Dealer Tire, LLC | 3,945,685 | ||||||
4,887,500 | Directv Financing, LLC | 4,888,917 | ||||||
700,000 | Dish DBS Corp. | 710,612 | ||||||
1,000,000 | Dish DBS Corp. | 1,009,375 | ||||||
8,739,098 | Division Holding Corp. | 8,744,603 | ||||||
578,466 | Dunn Paper, Inc. | 555,327 | ||||||
2,823,971 | Dynasty Acquisition Co., Inc. | 2,743,318 | ||||||
5,252,506 | Dynasty Acquisition Co., Inc. | 5,102,495 | ||||||
3,330,000 | Echo Global Logistics, Inc. | 3,313,350 | ||||||
2,490,651 | Edgewater Generation, LLC | 2,348,559 | ||||||
517,635 | Emerald 2, Ltd. | 513,753 | ||||||
1,568,548 | Fastlane Parent Co, Inc. | 1,567,294 | ||||||
6,957,499 | Flex Acquisition Company, Inc. | 6,938,644 | ||||||
8,000,000 | Florida Food Products, LLC | 7,860,000 | ||||||
1,240,000 | Frontier Communications Corp. | 1,276,129 | ||||||
19,425,210 | Frontier Communications Corp. | 19,386,360 | ||||||
4,705,208 | Geon Performance Solutions, LLC | 4,739,038 | ||||||
8,380,885 | Gogo Intermediate Holdings, LLC | 8,373,426 | ||||||
3,960,469 | Golden Nugget, LLC | 3,932,548 | ||||||
11,060,280 | Gordian Medical, Inc. | 10,968,148 | ||||||
4,732,701 | Greenway Health, LLC | 4,496,066 | ||||||
4,975,000 | GVC Holdings Gibraltar, Ltd. | 4,957,587 | ||||||
737,295 | HAH Group Holding Company, LLC | 737,295 | ||||||
5,826,968 | HAH Group Holding Company, LLC | 5,826,967 | ||||||
5,718,436 | Hamilton Projects Acquiror, LLC | 5,710,087 | ||||||
4,153,969 | Heartland Dental, LLC | 4,108,982 | ||||||
4,185,511 | Hertz Corp. | 4,185,511 | ||||||
793,456 | Hertz Corp. | 793,456 | ||||||
7,237,011 | HireRight, Inc. | 7,202,635 | ||||||
4,974,937 | Hudson River Trading, LLC | 4,933,198 | ||||||
4,974,937 | ICP Industrial, Inc. | 4,900,313 | ||||||
6,982,716 | IDERA, Inc. | 6,971,823 | ||||||
4,000,000 | Ineos Us Finance, LLC | 3,976,680 | ||||||
7,819,000 | Iri Holdings, Inc. | 7,809,226 | ||||||
4,000,000 | Jack Ohio Finance, LLC | 3,980,000 |
78
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
11. Joint Ventures (Continued)
Par/Principal | Investments | Fair Value | ||||||
$ | 4,937,594 | Jane Street Group, LLC | $ | 4,895,427 | ||||
2,493,750 | Jump Financial, LLC | 2,475,047 | ||||||
5,000,000 | Kissner Milling Co., Ltd. | 4,813,550 | ||||||
5,000,000 | LABL, Inc. | 4,987,500 | ||||||
10,215,665 | Liquid Tech Solutions Holdings, LLC | 10,215,665 | ||||||
3,864,000 | Luxembourg Investment Co., 428 SARL | 3,826,519 | ||||||
3,614,067 | Medallion Midland Acquisition, LP | 3,594,190 | ||||||
5,000,000 | Meridian Adhesives Group, Inc. | 5,000,000 | ||||||
8,641,073 | MH Sub I, LLC | 8,650,060 | ||||||
3,334,000 | Michael Baker International, LLC | 3,300,993 | ||||||
1,500,000 | MicroStrategy, Inc. | 1,507,500 | ||||||
5,508,332 | Monitronics International, Inc. | 5,164,061 | ||||||
4,987,500 | MPH Acquisition Holdings, LLC | 4,859,720 | ||||||
12,187,890 | MSG NATIONAL PROPERTIES, LLC | 12,187,890 | ||||||
5,467,537 | MYOB US Borrower, LLC | 5,421,992 | ||||||
7,370,376 | National Mentor Holdings, Inc. | 7,282,373 | ||||||
233,236 | National Mentor Holdings, Inc. | 230,451 | ||||||
10,676,409 | Navitas Midstream Midland Basin, LLC | 10,639,042 | ||||||
1,488,608 | Nexus Buyer, LLC | 1,480,361 | ||||||
2,342,129 | Nouryon USA, LLC | 2,331,894 | ||||||
400,000 | Paysafe Finance, PLC | 372,764 | ||||||
8,777,486 | Perstorp Holding Ab | 8,777,486 | ||||||
10,697,818 | PG&E Corp. | 10,569,444 | ||||||
2,500,000 | Proofpoint, Inc. | 2,487,700 | ||||||
9,126,552 | Protective Industrial Products, Inc. | 9,086,669 | ||||||
4,962,025 | Pug, LLC | 4,843,135 | ||||||
1,995,000 | Pug, LLC | 1,982,531 | ||||||
8,000,000 | Quikrete Holdings, Inc. | 7,977,760 | ||||||
2,000,000 | Regionalcare Hospital Partners Holdings, Inc. | 2,025,333 | ||||||
5,195,289 | Regionalcare Hospital Partners Holdings, Inc. | 5,185,574 | ||||||
10,205,242 | RXB Holdings, Inc. | 10,205,242 | ||||||
6,947,500 | S&S Holdings, LLC | 6,947,500 | ||||||
2,373,723 | Safe Fleet Holdings, LLC | 2,356,775 | ||||||
938,441 | Safety Products/JHC Acquisition Corp. | 891,519 | ||||||
17,360,447 | Safety Products/JHC Acquisition Corp. | 16,492,425 | ||||||
19,910,906 | Schenectady International Group, Inc. | 19,910,906 | ||||||
18,735,131 | SCIH Salt Holdings, Inc. | 18,532,229 | ||||||
12,705,290 | SFR Group, SA | 12,629,058 | ||||||
4,901,996 | Sierra Acquisition, Inc. | 4,889,741 | ||||||
3,003,648 | Sophia, LP | 3,001,395 | ||||||
2,555,238 | Spirit Aerosystems, Inc. | 2,555,877 | ||||||
10,518,297 | SSH Group Holdings, Inc. | 10,133,748 | ||||||
4,949,239 | Staples, Inc. | 4,773,788 | ||||||
2,278,144 | Station Casinos, LLC | 2,256,911 |
79
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
11. Joint Ventures (Continued)
Par/Principal | Investments | Fair Value | ||||||
$ | 2,968,831 | Team Health Holdings, Inc. | $ | 2,830,038 | ||||
9,044,550 | Tecta America Corp. | 9,033,244 | ||||||
3,846,000 | Tenneco, Inc. | 3,773,132 | ||||||
2,969,388 | Tenneco, Inc. | 2,921,135 | ||||||
4,863,344 | The Dun & Bradstreet Corp. | 4,840,778 | ||||||
2,969,697 | TransDigm, Inc. | 2,926,280 | ||||||
14,962,108 | Traverse Midstream Partners, LLC | 14,878,021 | ||||||
7,462,502 | Triton Water Holdings, Inc. | 7,374,295 | ||||||
1,488,750 | Truck Hero, Inc. | 1,479,103 | ||||||
7,858,108 | TSL Engineered Products, LLC | 7,858,108 | ||||||
3,794,493 | United Airlines, Inc. | 3,799,653 | ||||||
5,000,000 | University Support Services, LLC | 4,975,000 | ||||||
6,000,000 | Urban One, Inc. | 6,200,250 | ||||||
4,000,000 | Venga Finance Sarl | 3,912,520 | ||||||
3,505,294 | Veritext Corp. | 3,471,994 | ||||||
2,500,000 | Virgin Media Bristol, LLC | 2,497,275 | ||||||
7,830,754 | Vyaire Medical, Inc. | 6,695,295 | ||||||
10,747,733 | WaterBridge Midstream Operating, LLC | 10,462,273 | ||||||
9,473,412 | Watlow Electric Manufacturing Co. | 9,446,792 | ||||||
9,074,647 | Western Dental Services, Inc. | 9,070,110 | ||||||
388,648 | Western Dental Services, Inc. | 388,454 | ||||||
7,449,969 | Wilsonart, LLC | 7,443,785 | ||||||
3,150,550 | Wrench Group, LLC | 3,150,550 | ||||||
8,973,775 | YI, LLC | 8,973,775 | ||||||
4,943,000 | American Rock Salt Company, LLC | 4,955,358 | ||||||
2,065,000 | Asp Ls Acquisition Corp. | 2,074,045 | ||||||
15,632,000 | Asurion, LLC | 15,671,080 | ||||||
4,698,000 | Barracuda Networks, Inc. | 4,749,396 | ||||||
5,088,472 | CDS U.S. Intermediate Holdings, Inc. | 5,058,247 | ||||||
9,972,000 | Edelman Financial Services, LLC | 9,988,653 | ||||||
1,545,000 | IDERA, Inc. | 1,545,000 | ||||||
4,998,000 | Tecta America Corp. | 4,998,000 | ||||||
13,020,000 | TIBCO Software, Inc. | 13,047,082 | ||||||
1,410,000 | AIG CLO, Ltd. 21-1A F | 1,269,740 | ||||||
3,500,000 | Avery Point CLO, Ltd. 15-6A E1 | 3,380,281 | ||||||
1,224,000 | Battalion CLO, Ltd. 21-17A F | 1,122,509 | ||||||
2,100,000 | Carlyle GMS CLO, 16-3A FRR | 1,982,547 | ||||||
2,000,000 | Eaton Vance CDO, Ltd. 15-1A FR | 1,828,997 | ||||||
2,000,000 | Elevation CLO, Ltd. 13-1A D2 | 1,973,209 | ||||||
5,150,000 | Great Lakes CLO, Ltd. 21-6A E | 4,905,936 | ||||||
1,000,000 | Greywolf CLO, Ltd. 20-3RA ER | 949,120 | ||||||
2,500,000 | Hayfin Kingsland XI, Ltd. 19-2A ER | 2,412,073 | ||||||
3,000,000 | Highbridge Loan Management, Ltd. 11A-17 E | 2,825,041 | ||||||
1,200,000 | Jamestown CLO, Ltd. 17-10A D | 1,152,594 |
80
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
11. Joint Ventures (Continued)
Par/Principal | Investments | Fair Value | ||||||
$ | 2,000,000 | KKR Financial CLO, Ltd. 15 FR | $ | 1,879,568 | ||||
2,500,000 | LCM, Ltd. Partnership 16A ER2 | 2,372,919 | ||||||
4,500,000 | Marble Point CLO, Ltd. 20-1A E | 4,391,784 | ||||||
3,000,000 | Medalist Partners Corporate Finance CLO, Ltd. 21-1A D | 2,832,609 | ||||||
3,000,000 | Northwoods Capital, Ltd. 17-15A ER | 2,909,451 | ||||||
2,200,000 | OCP CLO, Ltd. 14-5A DR | 2,117,791 | ||||||
2,000,000 | OZLM, Ltd. 16-15A DR | 1,921,542 | ||||||
1,500,000 | Palmer Square CLO, Ltd. 21-4A F | 1,412,882 | ||||||
2,000,000 | Regatta II Funding, LP 13-2A DR2 | 1,967,709 | ||||||
1,455,000 | Saranac CLO, Ltd. 20-8A E | 1,433,445 | ||||||
4,000,000 | Sound Point CLO, Ltd. 17-1A E | 3,736,485 | ||||||
2,400,000 | Sound Point CLO, Ltd. 17-2A E | 2,173,247 | ||||||
1,000,000 | Sound Point CLO, Ltd. 18-3A D | 895,152 | ||||||
3,000,000 | Symphony CLO, Ltd. 2012-9A ER2 | 2,937,094 | ||||||
3,000,000 | Trimaran CAVU 2021-2A, Ltd. 21-2A E | 2,915,444 | ||||||
1,500,000 | Trysail CLO, Ltd. 21-1A E | 1,445,165 | ||||||
3,000,000 | Venture CDO, Ltd. 16-23A ER2 | 2,891,525 | ||||||
2,000,000 | Venture CDO, Ltd. 16-25A E | 1,936,060 | ||||||
4,995,000 | Venture CDO, Ltd. 20-39A E | 4,921,690 | ||||||
3,000,000 | Venture CLO 43, Ltd. 21-43A E | 2,901,049 | ||||||
3,000,000 | Wind River CLO, Ltd. 14-2A FR | 2,488,676 | ||||||
3,000,000 | Zais CLO 13, Ltd. 19-13A D1 | 2,818,422 |
Below is certain summarized financial information for FBLC Senior Loan Fund, LLC as of December 31, 2021 (dollar amounts in thousands):
Consolidated Statement of Assets, Liabilities and Members’ Equity:
ASSETS | ||||
Investments, at fair value (amortized cost of $1,085,169,753) | $ | 1,088,337,163 | ||
Cash and cash equivalents | 33,860,764 | |||
Receivable for unsettled trades | 37,392,545 | |||
Cash collateral on deposit with custodian | 31,120,000 | |||
Interest receivable | 5,103,597 | |||
Prepaid expenses and other assets | 146,335 | |||
Total assets | $ | 1,195,960,404 | ||
LIABILITIES | ||||
Revolving credit facilities (net of deferred financing costs of $2,488,184) | $ | 631,561,813 | ||
Secured borrowings | 94,736,988 | |||
Payable for unsettled trades | 60,560,105 | |||
Distribution payable | 7,211,307 | |||
Interest and credit facility fees payable | 2,265,634 | |||
Accounts payable and accrued expenses | 971,370 | |||
Total liabilities | $ | 797,307,217 | ||
81
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
11. Joint Ventures (Continued)
MEMBERS’ CAPITAL | ||||
Capital contributed | $ | 383,495,510 | ||
Accumulated earnings | 15,157,677 | |||
Total members’ capital | 398,653,187 | |||
Total liabilities and members’ capital | $ | 1,195,960,404 |
Consolidated Statement of Operations:
Investment income: | ||||
Interest from investments | $ | 44,752,413 | ||
Interest from cash and cash equivalents | 19,615 | |||
Total interest income | 44,772,028 | |||
Fee and other income | 191,986 | |||
Total investment income | 44,964,014 | |||
Operating expenses: | ||||
Interest and credit facility financing expenses | 10,050,591 | |||
Other general and administrative | 1,385,706 | |||
Professional fees | 650,627 | |||
Organizational costs | 124,793 | |||
Total expenses | 12,211,717 | |||
Net investment income | 32,752,297 | |||
Realized and unrealized gain on investments: | ||||
Net realized gain from investments | 6,925,525 | |||
Net unrealized appreciation on investments | 3,167,410 | |||
Net realized and unrealized gain on investments | 10,092,935 | |||
Net increase in members’ capital resulting from operations | $ | 42,845,232 |
Commitments and Contingencies
FBLC Senior Loan Fund, LLC had outstanding commitments to fund investments totaling $2.2 million under undrawn revolvers and other credit facilities as of December 31, 2021.
82
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
12. Related Party Transactions and Arrangements
Transactions related to investments in affiliated companies, as defined by the Investment Company Act of 1940, by virtue of the Fund owning at least 5% of the voting securities of the issuer, for the year ended December 31, 2021 were as follows:
Affiliated | Type | Industry | Beginning | Purchases | Proceeds | Dividend | Realized | Change in | Value at | |||||||||||||||||||||
Barings Private Credit Corporation* | Non-Listed Business Development Company | Diversified | $ | — | $ | 700,000,000 | $ | — | $ | 26,622,340 | $ | — | $ | 8,635,237 | $ | 708,635,237 | ||||||||||||||
Golub Capital Direct Lending Corp.** | Non-Listed Business Development Company | Diversified | — | 11,500,000 | — | 176,513 | — | 8,435 | 11,508,435 | |||||||||||||||||||||
$ | — | $ | 711,500,000 | $ | — | $ | 26,798,853 | $ | — | $ | 8,643,672 | $ | 720,143,672 |
* | The Fund owns 86% of the voting shares of Barings Private Credit Corporation (“BPCC”), a perpetual life, non-exchange traded business development company (BDC) under the 1940 Act that is not consolidated by the Fund for financial reporting purposes. BPCC is externally managed by Barings, which makes all portfolio and investment decisions. The Fund has irrevocably waived its right to vote shares above 4.99% of outstanding shares, so cannot exercise a majority voting interest on material matters. Because the Fund has waived its right to vote shares above 4.99%, the Fund does not believe it controls BPCC for purposes of the 1940 Act or otherwise. |
** | The Fund owns 25% of the voting shares of Golub Capital Direct Lending Corp (“GDLC”), a closed-end business development company (BDC) under the 1940 Act that is not consolidated by the Fund for financial reporting purposes. GDLC is externally managed by GC Advisors LLC, which makes all portfolio and investment decisions. The Fund holds less than 50% of outstanding shares so cannot exercise a majority voting interest on material matters, and does not believe it controls GDLC for purposes of the 1940 Act or otherwise. |
13. Private Investment Vehicles
The following table represents investment strategies, unfunded commitments and redemptive restrictions of investments that are measured at NAV per share (or its equivalent) as a practical expedient as of December 31, 2021:
Security | Investment | Cost | Fair Value | Unfunded | Redemption | Redemption | Fund Term | ||||||||||||||||||
17Capital Co. Investment Fund V-L LP | Direct lending to a European private equity fund | $ | 25,759,098 | $ | 24,986,888 | $ | 326,083 | None | N/A | Liquidation to commence on the earlier of 5/7/2031 but no later than 180 days following full realization | |||||||||||||||
AG Direct Lending Fund II L.P. | Middle market direct lending | 17,916,043 | 18,915,997 | — | None | N/A | December 31, 2024 with one-year extensions available | ||||||||||||||||||
AG Direct Lending Fund III L.P. | Middle market direct lending | 18,102,555 | 20,335,682 | 1,600,000 | None | N/A | September 30, 2026 with one-year extensions available | ||||||||||||||||||
Annaly Credit Opportunities Onshore Fund LP | Middle market direct lending | 51,135,450 | 51,144,216 | — | None | N/A | May 31, 2025 with two one-year extensions available |
83
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
13. Private Investment Vehicles (Continued)
Security | Investment | Cost | Fair Value | Unfunded | Redemption | Redemption | Fund Term | ||||||||||||||||||
Ares Commercial Finance Feeder (A) LP | Direct lending to specialty finance companies | $ | 11,309,134 | $ | 13,135,522 | $ | 13,080,652 | None | N/A | June 30, 2025 | |||||||||||||||
Barings Capital Investment Corporation | Middle market direct lending | 76,000,000 | 76,926,005 | 19,000,000 | None | N/A | Until the earlier of a liquidity event or July 13, 2027 | ||||||||||||||||||
Barings CMS Fund LP | Middle market direct lending | 15,000,000 | 15,000,000 | 235,000,000 | None | N/A | Until distribution of investment proceeds | ||||||||||||||||||
Barings Private Credit Corporation | Middle market direct lending | 700,000,000 | 708,635,236 | — | Quarterly2 | Redemptions permitted at the discretion of the investment manager | N/A | ||||||||||||||||||
FBLC Senior Loan Fund LLC | Middle market direct lending | 78,562,000 | 81,621,413 | — | None | Redemptions permitted at the discretion of the investment manager | Until all investments are amortized, liquidated, transferred or disposed | ||||||||||||||||||
BlackRock Shasta CLO VII | Middle market direct lending | 251,162,791 | 256,096,119 | 48,837,209 | None | Redemptions pursuant to the Note Purchase and Security Agreement upon the direction of a majority of the subordinated note purchasers with the consent of the collateral manager | Earlier of twelve years from closing date and the amortization date (if any) | ||||||||||||||||||
Franklin BSP Lending Corporation | Middle market direct lending | 34,000,000 | 44,754,531 | — | Annually1 | N/A | N/A | ||||||||||||||||||
Crescent Mezzanine Partners VIIC, L.P. | Mezzanine level subordinated debt | 5,540,346 | 6,376,274 | 3,599,265 | None | N/A | December 21, 2025 available | ||||||||||||||||||
Crestline Specialty Lending III (U.S.), L.P. | Middle market direct lending | 6,672,081 | 6,883,019 | 23,759,515 | None | N/A | December 1, 2028 with one-year exensions available | ||||||||||||||||||
Endurance II L.P. | Direct lending to an international education company | 9,725,000 | 10,083,487 | 300,000 | None | N/A | Until the completion of the liquidation | ||||||||||||||||||
Golub Capital Direct Lending Corp. | Middle market direct lending | 11,500,000 | 11,508,435 | 38,500,000 | None | N/A | July 1, 2027 with extensions upon the approval of shareholders |
84
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
13. Private Investment Vehicles (Continued)
Security | Investment | Cost | Fair Value | Unfunded | Redemption | Redemption | Fund Term | ||||||||||||||||||
HPS Mezzanine Partners 2019 LP | Mezzanine level subordinated debt | $ | 8,340,651 | $ | 9,355,616 | $ | 1,851,857 | None | N/A | April 12, 2029 with one-year extensions available | |||||||||||||||
HPS Speciality Loan Fund V Feeder LP | Secured debt origination | 40,483,748 | 42,977,780 | 22,500,000 | None | N/A | September 10, 2028 with 1 year extenstions available | ||||||||||||||||||
Marlin Credit Opportunity Fund LP | Middle market direct lending | 50,423,715 | 50,838,238 | 49,576,285 | None | N/A | May 19, 2028 with one-year extensions available | ||||||||||||||||||
Middle Market Credit Fund II, LLC | Middle market direct lending | 12,708,191 | 15,273,674 | — | None | N/A | Until all investments are amortized, liquidated, transferred or disposed | ||||||||||||||||||
Morgan Stanley Direct Lending Fund | Middle market direct lending | 33,289,217 | 33,875,734 | 12,210,783 | Quarterly3 | N/A | N/A | ||||||||||||||||||
New Mountain Guardian III BDC, LLC | Middle market direct lending | 80,000,000 | 81,281,657 | 20,000,000 | None | N/A | July 15, 2025 with one-year extensions available | ||||||||||||||||||
Owl Rock Core Income Corp. | Middle market direct lending | 50,000,000 | 50,088,711 | — | Quarterly2 | N/A | N/A | ||||||||||||||||||
Owl Rock Technology Finance Corp. | Direct lending and mezzanine financing for technology and life-sciences companies | 35,000,000 | 38,669,900 | — | None | N/A | Until earliest of an Exchange Listing, the fifth anniversary of the final closing, and August 10, 2025 | ||||||||||||||||||
Owl Rock Technology Finance Corp. II | Direct lending and mezzanine financing for technology and life-sciences companies | 964,289 | 964,289 | 16,236,531 | None | N/A | Earlier of the five year anniversary of the Final Closing and the seven year anniversary of the Initial Closing, with two one-year extensions available | ||||||||||||||||||
Providence Debt Fund III (Non-US) L.P. | Middle market direct lending | 2,692,390 | 3,916,335 | 4,629,133 | None | N/A | October 24, 2021 with one-year extensions available | ||||||||||||||||||
Proxima Onshore Co-Invest, L.P. | Direct lending to a renewable energy company | 578,571 | 586,234 | 9,421,429 | None | N/A | Until the completion of the liquidation |
85
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
13. Private Investment Vehicles (Continued)
Security | Investment | Cost | Fair Value | Unfunded | Redemption | Redemption | Fund Term | ||||||||||||||||||
Raven Asset Fund II V LP | Asset based lending | $ | 4,993,994 | $ | 5,074,346 | $ | 7,624,570 | None | N/A | January 2029 with two one-year extensions available available | |||||||||||||||
Silver Point Specialty Credit Fund II, L.P. | Middle market direct lending | 33,835,151 | 35,275,861 | 16,167,762 | None | N/A | September 6, 2023 with one-year extensions available | ||||||||||||||||||
Thompson Rivers LLC | Middle market direct lending | 20,000,000 | 20,564,423 | — | None | Redemptions permitted with the consent of the investment fund’s voting members | Until cancellation of the Certificate of Formation | ||||||||||||||||||
Varagon Capital Direct Lending Fund | Middle market direct lending | 10,000,000 | 10,201,688 | 40,000,000 | None | N/A | September 2026 with one-year extensions available | ||||||||||||||||||
Varagon Structured Note Issuer I LLC | Middle market direct lending | 175,000,000 | 176,280,548 | 325,000,000 | None | Redemptions pursuant to the Indenture upon direction of a majority of the subordinated notes with the consent of the investment manager | October 2033 provided that the scheduled reinvestment end date is extended | ||||||||||||||||||
Vista Credit Partner Fund III LP | Direct lending to middle market technology companies | 15,356,985 | 16,609,395 | 34,941,346 | None | N/A | March 31, 2027 with two one-year extensions available | ||||||||||||||||||
Waccamaw River LLC LP | Middle market direct lending | 6,878,065 | 6,896,297 | 5,640,000 | None | Redemptions permitted with the prior consent of the Board | Until cancellation of the Certificate of Formation | ||||||||||||||||||
Total | $ | 1,892,929,465 | $ | 1,945,133,552 | $ | 949,802,420 |
1 | Up to 10% at each annual tender offer |
2 | Up to 5% at each quarterly tender offer |
3 | Up to 2.5% at each quarterly tender offer |
86
Cliffwater Corporate Lending Fund
Notes to Consolidated Financial Statements
December 31, 2021 (Continued)
14. Subsequent Events
In preparing these consolidated financial statements, management has evaluated subsequent events through the date of issuance of the consolidated financial statements included herein.
The Fund commenced a repurchase offer January 6, 2022 as follows:
Commencement Date | January 6, 2022 | |||
Repurchase Request | February 7, 2022 | |||
Repurchase Pricing date | February 7, 2022 | |||
Net Asset Value as of Repurchase Offer Date | ||||
Class I | $10.69 | |||
Amount Repurchased | ||||
Class I | $97,311,884 | |||
Percentage of Outstanding Shares Repurchased | ||||
Class I | 1.76% |
On February 1, 2022, Broadway Funding Holdings and all investments in Broadway Funding Holdings were sold to North Haven Private Income Fund LLC (f/k/a Morgan Stanley Private Income Fund LLC).
There have been no other subsequent events that occurred during such period that would require disclosure or would be required to be recognized in the consolidated financial statements.
87
Cliffwater Corporate Lending Fund
Other Information
December 31, 2021 (Unaudited)
Proxy Voting
The Fund is required to file Form N-PX, with its complete proxy voting record for the twelve-month period ending on June 30, no later than August 31. The Fund’s Form N-PX filing and a description of the Fund’s proxy voting policies and procedures are available: (i) without charge, upon request, by calling the Fund at 1-888-442-4420 or (ii) by visiting the SEC’s website at www.sec.gov.
Availability of Quarterly Portfolio Schedules
The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its report on Form N-PORT. The Fund’s Forms N-PORT are or will be available on the SEC’s website at www.sec.gov or by calling the Fund at 1-888-442-4420.
Long-Term Capital Gains Designation
For the year ending December 31, 2021, the Cliffwater Corporate Lending Fund designates $7,900,814 as a long-term capital gain distribution.
For the year ended December 31, 2021, 0.0% of the dividends paid from net investment income, including short-term capital gains, are designated as qualified dividend income.
For the year ended December 31, 2021, 0.0% of the dividends paid from net investment income, including short-term capital gains are designated as dividends received deduction available to corporate shareholders.
Approval of Investment Management Agreement
At the regular quarterly meeting of the Board of Trustees of the Fund (the “Board”) held on December 15, 2021 by a unanimous vote, the Board, including a majority of Trustees who are not “interested persons” within the meaning of Section 2(a)(19) of the Investment Company Act (the “Independent Trustees”), approved the Investment Management Agreement between Cliffwater LLC (the “Investment Manager”) and the Fund (the “Investment Management Agreement”).
Pursuant to relief granted by the SEC in light of the COVID-19 pandemic (the “Order”) and a determination by the Board that reliance on the Order was appropriate due to circumstances related to the current or potential effects of COVID-19, the December 15, 2021 regular quarterly meeting was held by videoconference. At the Board meeting and throughout the consideration process, the Board, including a majority of the Independent Trustees, was advised by counsel.
In advance of the Board meeting, the Independent Trustees requested and received materials from the Investment Manager to assist them in considering the approval of the Investment Management Agreement. The Independent Trustees reviewed reports from third parties and management about the below factors. The Board did not consider any single factor as controlling in determining whether or not to approve the Investment Management Agreement. Nor are the items described herein all-encompassing of the matters considered by the Board.
The Board engaged in a detailed discussion of the materials with management of the Investment Manager. The Independent Trustees then met separately with independent counsel to the Independent Trustees for a full review of the materials. Following this session, the full Board reconvened and after further discussion determined that the information presented provided a sufficient basis upon which to approve the Investment Management Agreement.
NATURE, EXTENT AND QUALITY OF SERVICES
The Board reviewed and considered the nature and extent of the investment advisory services provided by the Investment Manager to the Fund under the Investment Management Agreement, including the selection of Fund investments and oversight of the Fund’s sub-advisers. The Board also reviewed and considered the nature and extent of the non-advisory, administrative services provided by the Investment Manager, including, among other things, providing office facilities, equipment, and personnel. The Board also reviewed and considered the qualifications of the key personnel of the Investment Manager who provide the investment advisory and/or administrative services to the Fund. The Board determined that the Investment Manager’s key personnel are well-qualified by education and/or training and experience to perform the services
88
Cliffwater Corporate Lending Fund
Other Information
December 31, 2021 (Unaudited) (Continued)
in an efficient and professional manner. The Board also took into account the Investment Manager’s compliance policies and procedures, including the procedures used to determine the value of the Fund’s investments. The Board concluded that the overall quality of the advisory and administrative services provided was satisfactory.
PERFORMANCE
The Board considered the investment performance of the Investment Manager with respect to the Fund. The Board considered the performance of the Fund, noting that the Fund had out-performed its benchmark for the period June 5, 2019 through September 30, 2021.
FEES AND EXPENSES RELATIVE TO COMPARABLE FUNDS MANAGED BY OTHER INVESTMENT MANAGERS
The Board reviewed the advisory fee rates and total expense ratio of the Fund. The Board compared the advisory fee and total expense ratio for the Fund with various comparative data, including a report of other comparable funds.
The Board noted that the Fund’s advisory fee was calculated on net assets and at 1.00%, was below the median advisory fee of the peer universe identified in the provided Broadridge report. They further noted that the Investment Manager had implemented an expense cap so that total expenses of the Fund, subject to certain exclusions, do not exceed certain limits. The Board concluded that the advisory fees paid by the Fund and total expense ratio were reasonable and satisfactory in light of the services provided.
BREAKPOINTS AND ECONOMIES OF SCALE
The Board reviewed the structure of the Fund’s investment management under the Investment Management Agreement. The Board considered that the Investment Manager continued to monitor whether the Fund’s current fee level continues to reflect economies of scale and concluded that the fees were reasonable and satisfactory in light of the services provided.
PROFITABILITY OF INVESTMENT MANAGER AND AFFILIATES
The Board considered and reviewed information concerning the costs incurred and profits realized by the Investment Manager from its relationship with the Fund. The Board also reviewed the Investment Manager’s financial condition. The Board noted that the financial condition of the Investment Manager appeared stable. The Board determined that the advisory fees and the compensation to the Investment Manager were reasonable and its financial condition was adequate.
ANCILLARY BENEFITS AND OTHER FACTORS
The Board also discussed other benefits to be received by the Investment Manager from its management of the Fund, including, without limitation, the ability to market its advisory services for similar products. The Board noted that the Investment Manager did not have affiliations with the Fund’s transfer agent, administrator, custodian or distribution agent and therefore does not derive any benefits from the relationships these parties may have with the Fund. The Board concluded that the advisory fees were reasonable in light of the fall-out benefits.
GENERAL CONCLUSION
Based on its consideration of all factors that it deemed material, and assisted by the advice of its counsel, the Board concluded it would be in the best interest of the Fund and its shareholders to approve the Investment Management Agreement for an additional one-year term.
89
Cliffwater Corporate Lending Fund
Fund Management
December 31, 2021 (Unaudited)
The identity of the members of the Board and the Fund’s officers and brief biographical information is set forth below. The Fund’s Statement of Additional Information includes additional information about the membership of the Board.
INDEPENDENT TRUSTEES
NAME, ADDRESS | POSITION(S) | LENGTH | PRINCIPAL OCCUPATION(S) | NUMBER OF | OTHER |
Paul S. Atkins | Trustee | Since June 2021 | Chief Executive Officer and Founder, Patomak Global Partners, LLC (financial services consulting firm) (2009-Present); Independent Chairman of the Board and Director, BATS Global Markets, Inc. (2012-2015); Member, Congressional Oversight Panel for TARP (2009-2010); Commissioner, U.S. Securities and Exchange Commission (2002-2008); Principal, PricewaterhouseCoopers LLP (1994-2002). | 2 | None |
Dominic Garcia | Trustee | Since June 2021 | Chief Pension Investment Strategist, CBRE Global Investors (June 2021-Present); Advisory Board of Milken Institute for Public Finance (2021-Present); Chief Investment Officer, New Mexico Public Employees Retirement Association (2017- June 2021); Senior Alpha Manager, State of Wisconsin Investment Board (2008-2017); Research Advisory Board Member, University of North Carolina Keenan Institute of Private Markets and the University of Chicago Harris Center for Municipal Finance (2020 to Present); Trustee, United World College-USA the Santa Fe Preparatory School endowment and the Santa Fe Community Foundation impact investment committee (2020-Present). | 2 | None |
90
Cliffwater Corporate Lending Fund
Fund Management
December 31, 2021 (Unaudited) (Continued)
INDEPENDENT TRUSTEES (CONTINUED) | |||||
NAME, ADDRESS | POSITION(S) | LENGTH | PRINCIPAL OCCUPATION(S) | NUMBER OF | OTHER |
Paul J. Williams Year of Birth: 1956 | Trustee and Board Chairman | Since June 2021 | Investment Consultant, Texas Association of Counties (1995-2020); Chief Investment Officer, Texas County & District Retirement System (1999-2018). | 2 | None |
* | The fund complex consists of the Fund and Cliffwater Enhanced Lending Fund. |
INTERESTED TRUSTEES AND OFFICERS | |||||
NAME, ADDRESS | POSITION(S) | LENGTH | PRINCIPAL OCCUPATION(S) | NUMBER OF | OTHER |
Stephen L. Nesbitt** | Trustee and President | President Since Inception; Trustee since June 2021 | Chief Executive Officer and Chief Investment Officer, Cliffwater LLC (2004-Present). | 2 | None |
Lance J. Johnson | Treasurer | Since Inception | Chief Operations Officer, Cliffwater LLC (2014-Present); Senior Vice President, Brown Brothers Harriman & Co. (financial services firm) (2013-2014). | N/A | None |
91
Cliffwater Corporate Lending Fund
Fund Management
December 31, 2021 (Unaudited) (Continued)
INTERESTED TRUSTEES AND OFFICERS (CONTINUED) | |||||
NAME, ADDRESS | POSITION(S) | LENGTH | PRINCIPAL OCCUPATION(S) | NUMBER OF | OTHER |
Ann Maurer | Secretary | Since Inception | Senior Vice President (2017-Present); Vice President, Senior Client Service Manager. | N/A | None |
Bernadette Murphy | Chief Compliance Officer | Since April 2021 | Director, Vigilant Compliance, LLC (investment management solutions firm) (2018-Present); Director of Compliance and operations, B. Riley Capital Management, LLC (investment advisory firm) (2017-2018); Chief Compliance Officer, Dialectic Capital Management, LP (investment advisory firm) (2008-2018). | N/A | None |
* | The fund complex consists of the Fund and Cliffwater Enhanced Lending Fund. |
** | Mr. Nesbitt is deemed an interested person of the Fund because he is an officer of the Investment Manager. |
92
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Investment Manager
Cliffwater LLC
4640 Admiralty Way, 11th Floor
Marina del Rey, CA 90292
Website: www.cliffwaterfunds.com
Custodian Bank
State Street Bank and Trust Company
1 Iron Street
Boston, MA 02210
Fund Administrator, Transfer Agent and Fund Accountant
UMB Fund Services
235 W. Galena Street
Milwaukee, WI 53212-3949
Phone: (414) 299-2200
Distributor
Foreside Fund Services, LLC
Three Canal Plaza, Suite 100
Portland, Maine 04101
http://www.foreside.com
Independent Registered Public Accounting Firm
Cohen & Company, Ltd.
342 North Water Street, Suite 830
Milwaukee, Wisconsin 53202
Item 2. | Code of Ethics. |
(a) The registrant, as of the end of the period covered by this report, has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party.
(c) There have been no amendments, during the period covered by this report, to a provision of the code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, and that relates to any element of the code of ethics description.
(d) The registrant has not granted any waivers, during the period covered by this report, including an implicit waiver, from a provision of the code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, that relates to one or more of the items set forth in paragraph (b) of this item's instructions.
Item 3. | Audit Committee Financial Expert. |
As of the end of the period covered by the report, the registrant's board of trustees has determined that Mr. Paul S. Atkins, Mr. Dominic Garcia, and Mr. Paul J. Williams are qualified to serve as the audit committee financial experts serving on its audit committee and that they are "independent," as defined by Item 3 of Form N-CSR.
Item 4. | Principal Accountant Fees and Services. |
The registrant has engaged its principal accountant to perform audit services, audit-related services, tax services and other services during the year ended December 31, 2021. “Audit services” refer to performing an audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years. “Audit-related services” refer to the assurance and related services by the principal accountant that are reasonably related to the performance of the audit. “Tax services” refer to professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. “Other services” refer to professional services rendered by principal accountant for its review of the Fund’s registration statement filed with the SEC and the issuance of consents for such filing. The following table presents fees paid by the Fund for professional services rendered by Cohen & Company, Ltd. for the year ended December 31, 2021, and for the year ended December 31, 2020.
2021 | 2020 | |||||||
Fee Category | Fees | Fees | ||||||
Audit Fee | $ | 300,000 | $ | 90,000 | ||||
Audit-Related Fees | - | - | ||||||
Tax Fees | 12,000 | 6,000 | ||||||
All Other Fees | 6,774 | 4,098 | ||||||
Total Fees | $ | 318,774 | $ | 100,098 |
The audit committee has adopted pre-approval policies and procedures that require the audit committee to pre-approve all audit and non-audit services of the registrant, including services provided to any entity affiliated with the registrant.
The percentage of fees billed by Cohen & Company, Ltd. for the year ended December 31, 2021 and for the year ended December 31, 2020, applicable to non-audit services pursuant to waiver of pre-approval requirement were as follows:
FYE 12/31/2021 | FYE 12/31/2020 | |||||
Audit-Related Fees | 0% | 0% | ||||
Tax Fees | 0% | 0% | ||||
All Other Fees | 0% | 0% |
All of the principal accountant’s hours spent on auditing the registrant’s financial statements were attributed to work performed by full-time permanent employees of the principal accountant.
The following table indicates the non-audit fees billed or expected to be billed by the registrant’s accountant for services to the registrant and to the registrant’s investment adviser (and any other controlling entity, etc.—not sub-adviser) for the last two years. The audit committee of the board of trustees/directors has considered whether the provision of non-audit services that were rendered to the registrant's investment adviser is compatible with maintaining the principal accountant's independence and has concluded that the provision of such non-audit services by the accountant has not compromised the accountant’s independence.
Non-Audit Related Fees | FYE 12/31/2021 | FYE 12/31/2020 | ||||
Registrant | 0 | 0 | ||||
Registrant’s Investment Adviser | 0 | 0 |
Item 5. | Audit Committee of Listed Registrants. |
Not applicable.
Item 6. | Investments. |
See the Annual Report to Shareholders under Item 1 of this Form.
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
AUDAX MANAGEMENT COMPANY, LLC
AUDAX MANAGEMENT COMPANY (NY), LLC
(TOGETHER, THE “FIRM”)
VOTING POLICIES AND PROCEDURES
PURPOSE AND GENERAL STATEMENT
The purpose of these voting policies and procedures is to set forth the principles and procedures by which the Firm votes or gives consents with respect to the securities owned by the separate accounts and pooled investment vehicles advised by the Firm (each, an “Advised Vehicle” and collectively, the “Advised Vehicles”) for which the Firm exercises voting authority and discretion (the “Votes”). For avoidance of doubt, a Vote includes: (i) any proxy and any shareholder vote or consent, including a vote or consent for a private company that does not involve a proxy; and (ii) any vote or consent provided on behalf of an Advised Vehicle which holds debt of a private company. These policies and procedures have been designed to help ensure that Votes are voted in what the Firm believes to be the best interests of the Advised Vehicles in accordance with the Firm’s fiduciary duties and Rule 206(4)-6 under the Investment Advisers Act of 1940, as amended (the “Advisers Act”).
These voting policies and procedures will be made available to the Advised Vehicles (and their investors) upon written request, subject to the provision that these policies and procedures are subject to change at any time without notice.
Copies of relevant proxy logs, identifying how proxies were voted in connection with an Advised Vehicle, will also be made available to the Advised Vehicles (and their investors) upon written request. Copies of relevant proxy logs, identifying how proxies were voted in connection with an Advised Vehicle, will also be made available to the Advised Vehicles (and their investors) upon written request.
POLICY
The Firm and its affiliates engage in a broad range of activities, including investment activities for their own account and for the account of other investment funds or accounts, and providing investment advisory and other services to funds, separate accounts and operating companies. In the ordinary course of conducting the Firm’s activities, the interests of an Advised Vehicle may conflict with the interests of the Firm and/or other Advised Vehicles. For example, one Advised Vehicle may hold senior debt securities in one company while another Advised Vehicle holds equity securities in the same company. Should that company fall into financial distress, the interests of the Advised Vehicles holding senior debt could conflict with the interests of the Advised Vehicles holding equity.
Any conflicts of interest relating to the voting of Votes, regardless of whether actual or perceived, will be addressed in accordance with these policies and procedures. The guiding principle by which the Firm votes all Votes is to vote in what the Firm believes to be the best interests of each Advised Vehicle by maximizing the economic value of the relevant Advised Vehicle’s holdings, taking into account the relevant Advised Vehicle’s investment horizon, the contractual obligations under the relevant advisory agreements or comparable documents, and all other relevant facts and circumstances at the time of the vote. The Firm does not permit Voting decisions to be influenced in any manner that is contrary to, or dilutive of, this guiding principle.
It is the general policy of the Firm to vote or give consent on all matters presented to security holders in any Vote, and these policies and procedures have been designated with that in mind. However, the Firm reserves the right to abstain on any particular Vote or otherwise withhold its vote or consent on any matter if, in the judgment of the Chief Legal Officer or the relevant Firm investment professional, the costs associated with voting such Vote outweigh the benefits to the relevant Advised Vehicles or if the circumstances make such an abstention or withholding otherwise advisable and in the best interests of the relevant Advised Vehicles. In connection with the voting of Votes, the Firm’s personnel may, in their discretion, meet with members of a company’s management and discuss matters of importance to the Advised Vehicles and their economic interests.
PROCEDURES
Conflicts of Interest
The Firm’s Chief Legal Officer and Chief Compliance Officer (“CCO”) have the responsibility to monitor Votes for any conflicts of interest, regardless of whether they are actual or perceived. All proxy votes will require a mandatory conflicts of interest review by the Chief Legal Officer or CCO in accordance with these policies and procedures, which will include consideration of whether the Firm or any investment professional or other person recommending how to vote has an interest in how the proxy vote is voted that may present a conflict of interest. In addition, all Firm investment professionals are expected to perform their tasks relating to the voting of all Votes (including any proxy votes) in accordance with the principles set forth above, according the first priority to the best interest of the relevant Advised Vehicles.
If at any time any investment professional becomes aware of any potential or actual conflict of interest or perceived conflict of interest regarding any particular Voting decision, he or she should contact the CCO or Chief Legal Officer or any member of the Audax legal team. If any investment professional is pressured or lobbied either from within or outside the Firm with respect to any particular Voting decision, he or she should contact the CCO or Chief Legal Officer. The CCO or Chief Legal Officer will use his or her best judgment to address any such conflict of interest and ensure that it is resolved in accordance with his or her independent assessment of the best interests of the affected Advised Vehicles.
Where the Chief Legal Officer deems appropriate in his or her sole discretion, unaffiliated third parties may be used to help resolve conflicts. In this regard, the Chief Legal Officer will have the power to retain independent fiduciaries, consultants or professionals to assist with Voting decisions and/or to delegate voting or consent powers to such fiduciaries, consultants or professionals.
Voting
All Firm personnel are responsible for promptly forwarding all proxy materials, consent or proxy requests or notices or materials related thereto to a member of the Audax legal team. The Chief Legal Officer will be responsible for ensuring that each proxy is voted in a timely manner and as otherwise required by the terms of such proxy.
All proxy votes are initially referred to the Chief Legal Officer or appropriate investment professional for a voting decision. In most cases, the Chief Legal Officer or investment professional will make the decision as to the appropriate Vote decision. In making such decision, he or she may rely on any of the information and/or research available to him or her. If the investment professional is making the Voting decision, the investment professional will inform internal counsel of any such Voting decision, and if internal counsel does not object to such decision as a result of his or her conflict of interest review, the proxy will be voted in such manner. If the investment professional and internal counsel are unable to arrive at an agreement as to how to vote, then the Chief Legal Officer may consult with the Firm’s Chief Operating Officer as to the appropriate vote, who will then review the issues and arrive at a decision based on the overriding principle of seeking the maximization of the economic value of the relevant Advised Vehicles’ holdings.
Recordkeeping
The Firm’s Recordkeeping Policies and Procedures apply to proxy votes. Firm personnel should refer to the Recordkeeping Policies and Procedures for additional guidance and information.
RESPONSIBILITY
The Chief Legal Officer will be responsible for administering these procedures.
LAST UPDATED: July 2019
Cliffwater LLC
PROXY POLICY AND PROCEDURE
Rule 206(4)-6 of the Advisers Act requires a registered investment adviser that exercises voting authority with respect to client securities to: (i) adopt written policies reasonably designed to ensure that the investment adviser votes in the best interest of its clients and addresses how the investment adviser will deal with material conflicts of interest that may arise between the investment adviser and its clients; (ii) disclose to its clients information about such policies and procedures; and (iii) upon request, provide information on how proxies were voted.
For its non-discretionary clients, Cliffwater does not have authority to vote client securities. These clients will receive their proxies, corporate actions, consents and other solicitations directly from their custodian or the relevant issuer or investment fund. These clients may contact their client service professionals with questions about a particular solicitation.
For its discretionary clients, Cliffwater generally takes responsibility for ensuring that proxies solicited by, or with respect to, the issuers of securities held in the client’s investment account, and corporate actions and consents sought by such issuers (including tender offers and rights offerings) are voted. In most cases, the managers of the commingled funds and separate accounts holding the assets vote the proxy solicitations. However, Cliffwater will take such action in limited circumstances which may include private partnership amendments and consents and in the event that an individual security is held by the client outside of a commingled fund or separate account where the manager votes the securities. Cliffwater’s discretionary clients may also retain the right to vote any proxies or take action relating to specified securities held in the client’s investment account, provided the client gives timely written notice to Cliffwater.
Cliffwater will not put its own interests ahead of those of any of its client and will resolve any possible conflicts between its interests and those of the client in favor of the client. When voting proxies, Cliffwater follows procedures designed to identify and address material conflicts of interest that may arise between its interests and those of its clients. Accordingly, prior to voting any proxy, Cliffwater will determine whether a material conflict of interest exists. A conflict of interest will be considered material to the extent that it is determined that the conflict has the potential to influence Cliffwater’s decision making in voting the proxy. If Cliffwater determines that there is a material conflict of interest related to the proxy solicitation, Cliffwater will take appropriate action to resolve the conflict which may include abstaining from a particular vote.
Cliffwater will seek to act solely in the best interests of its clients when exercising its voting authority. Cliffwater determines whether and how to vote proxies on a case-by-case basis. In making such determination, Cliffwater: (i) will attempt to consider all aspects of the vote that could affect the value of the issuer or that of the relevant client, (ii) will vote in a manner that it believes is consistent with the relevant client’s stated objectives, (iii) generally will vote in accordance with the recommendation of the issuing company’s management on routine and administrative matters, unless Cliffwater has a particular reason to vote to the contrary, and (iv) may not vote at all to the extent the outcome of the vote or action does not have a material impact on the issuer or value of its securities.
Under Rule 204-2 under the Advisers Act, Cliffwater must retain: (i) its voting policies and procedures; (ii) corporate action and proxy statements received; (iii) records of votes cast; (iv) records of client requests for voting information; and (v) any documents prepared by Cliffwater that were material to making a decision on how to vote. Under the circumstances where Cliffwater votes a proxy, corporate action or consent solicited by an issuer of securities or an investment fund, Cliffwater will document and maintain its voting record.
Cliffwater’s General Counsel and Chief Compliance Officer must approve the engagement of any proxy advisory firm to assist in connection with voting client securities.
For private investment funds, Cliffwater may accept a seat on an advisory board or similar group for a fund in which one or more Cliffwater clients have invested. Cliffwater believes advisory board service benefits its clients by allowing Cliffwater greater insight into the fund and its strategies and that, in general, the interests of its clients as investors will be aligned with the interests of all investors in the fund. However, if the interests of Cliffwater’s clients were to diverge from the interests of each other, the Cliffwater representative will take appropriate action to resolve the conflict which may include abstaining from a particular vote. Please see section III.B.7. for further information regarding Cliffwater’s actions with respect to advisory boards.
Crescent Capital Group LP
PROXY POLICY AND PROCEDURE
Background
In Proxy Voting by Investment Advisers, Investment Advisers Act Release No. 2106 (January 31, 2003), the SEC noted that, “The federal securities laws do not specifically address how an adviser must exercise its proxy voting authority for its clients. Under the Advisers Act, however, an adviser is a fiduciary that owes each of its clients a duty of care and loyalty with respect to all services undertaken on the client’s behalf, including proxy voting. The duty of care requires an adviser with proxy voting authority to monitor corporate events and to vote the proxies.” Rule 206(4)-6 under the Advisers Act requires each registered investment adviser that exercises proxy voting authority with respect to client securities to:
● Adopt and implement written policies and procedures reasonably designed to ensure that the adviser votes client securities in the clients’ best interests. Such policies and procedures must address the manner in which the adviser will resolve material conflicts of interest that can arise during the proxy voting process;
● Disclose to clients how they may obtain information from the adviser about how the adviser voted with respect to their securities; and
● Describe to clients the adviser’s proxy voting policies and procedures and, upon request, furnish a copy of the policies and procedures. Additionally, paragraph (c)(2) of Rule 204-2 imposes additional recordkeeping requirements on investment advisers that execute proxy voting authority, as described in the Maintenance of Books and Records section of this Manual. The Advisers Act lacks specific guidance regarding an adviser’s duty to direct clients’ participation in class actions. However, many investment advisers adopt policies and procedures regarding class actions.
Risks
In developing these policies and procedures, Crescent considered numerous risks associated with the proxy voting process. This analysis includes risks such as:
• Crescent lacks written proxy voting policies and procedures;
• Proxies are not identified and processed in a timely manner;
• Proxies are not voted in Clients’ best interests;
• Conflicts of interest between Crescent and a Client are not identified or resolved appropriately;
• Third-party proxy voting services do not vote proxies according to Crescent’s instructions and in Clients’ best interests;
• Proxy voting records, Client requests for proxy voting information, and Crescent’s responses to such requests, are not properly maintained;
• Crescent lacks policies and procedures regarding Clients’ participation in class actions; and
• Crescent fails to maintain documentation associated with Clients’ participation in class actions. Crescent has established the following guidelines as an attempt to mitigate these risks.
Policies and Procedures
Proxy Voting
Crescent primarily invests Client assets in fixed income assets which typically do not issue proxies. However, Crescent’s Clients also invest in equity securities and therefore may receive proxies in connection with such assets. Proxies are assets of Crescent’s Clients that must be voted with diligence, care, and loyalty. Crescent will vote each proxy in accordance with its fiduciary duty to its Clients. Crescent will generally seek to vote proxies in a way that maximizes the value of Clients’ assets. However, Crescent will document and abide by any specific proxy voting instructions conveyed by a Client with respect to that Client’s securities. The Portfolio Administration Group coordinates Crescent’s proxy voting process.
Paragraph (c)(ii) of Rule 204-2 under the Advisers Act requires Crescent to maintain certain books and records associated with its proxy voting policies and procedures. Crescent’s recordkeeping obligations are described in the Maintenance of Books and Records section of this Manual. The Compliance Group will ensure that Crescent complies with all applicable recordkeeping requirements associated with proxy voting.
Fixed-Income Securities
In addition to covering the voting of equity securities, this policy also applies generally to voting and/or consent rights relating to fixed income securities, including but not limited to, plans of reorganization, waivers and consents under applicable indentures. However, the policy does not apply to consent rights that primarily entail decisions to buy or sell investments, such as tender or exchange offers, conversions, put options, redemption and Dutch auctions. This proxy policy is designed and implemented in a manner reasonably expected to ensure that voting and consent rights are exercised in the best interests of Clients.
For the voting of fixed-income securities, Crescent believes the potential for material conflicts of interest between Clients and Crescent is limited. However, potential conflicts may arise where Crescent or its related persons or entities are named parties to, or are participating in, a bankruptcy work-out or similar committee. Potential conflicts of interest identified should be escalated in accordance with the “Conflicts of Interest” section below.
Absent specific Client instructions, Crescent has adopted the following proxy voting procedures designed to ensure that proxies are properly identified and voted, and that any conflicts of interest are addressed appropriately:
● The Portfolio Administration Group shall coordinate with the custodian for each new Client account to ensure the account is set up so that proxy materials are forwarded to Crescent, either by mail or electronically.
● All proxy voting materials received by Crescent shall be immediately forwarded to the Portfolio Administration Group.
● The Portfolio Administration Group will review the list of Clients and compare the record date of the proxies with a security holdings list for the security or company soliciting the proxy vote. For any Client who has provided specific voting instructions, Crescent shall vote that Client’s proxy in accordance with the client’s written instructions. Clients who have selected a third party to vote proxies, and whose proxies were inadvertently received by Crescent, shall be forwarded to such third-party designee for voting and submission.
● The Portfolio Administration Group will provide all proxy solicitation information and materials to the appropriate Investment Personnel of Crescent (i.e., Portfolio Managers, Research Analysts, etc.) for their review and consideration.
● Crescent’s Investment Personnel shall be responsible for making voting decisions with respect to all Client proxies for accounts where Crescent has proxy voting authority.
● The relevant member of the investment staff should inform the Portfolio Administration Group of his or her proxy vote decision. The Portfolio Administration Group will vote the proxy and submit it in a timely manner. The member of the investment staff must consider any conflicts of interest when making a proxy vote decision (see the “Conflicts of Interest” section below).
Conflicts of Interest
● The relevant investment professionals will consider whether Crescent is subject to any material conflict of interest in connection with each proxy vote. Supervised Persons must notify the Compliance Officers if they are aware of any material conflict of interest associated with a proxy vote. It is impossible to anticipate all material conflicts of interest that could arise in connection with proxy voting. The following examples are meant to help Supervised Persons identify potential conflicts:
○ Crescent provides investment advice to a publicly traded company (an “Issuer”). Crescent receives a proxy solicitation from that Issuer, or from a competitor of that Issuer;
○ Crescent provides investment advice to an officer or director of an Issuer. Crescent receives a proxy solicitation from that Issuer, or from a competitor of that Issuer;
○ An issuer or some other third party offers Crescent or a Supervised Person compensation in exchange for voting a proxy in a particular way;
○ A Supervised Person, or a member of a Supervised Person’s household, has a personal or business relationship with an Issuer. Crescent receives a proxy solicitation from that Issuer; and
○ Crescent’s Clients have potentially conflicting investments in the Issuer, including investments made in different parts of the Issuer’s capital structure.
● If Crescent detects a material conflict of interest in connection with a proxy solicitation, the Company will abide by the following procedures:
○ The Compliance Officers will convene the Proxy Voting Committee (the “Committee”), which is comprised of Chief
Operating Officer (“COO”), Chief Financial Officer (“CFO”), and the CCO. The CCO serves as the Committee’s chairperson.
○ The relevant member(s) of the investment staff or the Compliance Officers will describe the proxy vote under consideration and identify the perceived conflict of interest. The same individual(s) will also propose the course of action that they believe is in Crescent’s Clients’ best interests. The individual(s) presenting will tell the Committee why they believe that this course of action is most appropriate.
○ The Committee members will review any documentation associated with the proxy vote and evaluate the proposal presented. The Committee members may wish to consider, among other things:
■ A vote’s likely short-term and long-term impact on the Issuer;
■ Whether the Issuer has responded to the subject of the proxy vote in some other manner;
■ Whether the issues raised by the proxy vote would be better handled by some other action by the government or the Issuer;
■ Whether implementation of the proxy proposal appears likely to achieve the proposal’s stated objectives; and
■ Whether the proposal appears consistent with Clients’ best interests.
○ If the Committee is unable to reach a unanimous decision regarding the proxy vote, Crescent will, at its own expense, engage an outside proxy voting service or consultant to make a recommendation. The CCO will retain documentation of the proxy voting service or consultant’s recommendation and will vote Clients’ proxies in accordance with that recommendation.
● If no material conflict of interest is identified, the Portfolio Administration Group shall vote the proxy in accordance with the investment staff’s recommendation.
● Crescent will not neglect its proxy voting responsibilities, but the Company may abstain from voting if it deems that abstaining is in its Clients’ best interests. For example, Crescent may be unable to vote securities that have been lent by the custodian. Also, proxy voting in certain countries involves “share blocking,” which limits Crescent’s ability to sell the affected security during a blocking period that can last for several weeks. Crescent believes that the potential consequences of being unable to sell a security usually outweigh the benefits of participating in a proxy vote, so Crescent generally abstains from voting when share blocking is required. The Portfolio Administration Group will prepare and maintain memoranda describing the rationale for any instance in which Crescent does not vote a Client’s proxy.
● The Portfolio Administration Group will retain the following information in connection with each proxy vote:
○ The Issuer’s name;
○ The security’s ticker symbol or CUSIP, as applicable;
○ The shareholder meeting date;
○ The number of shares that Crescent voted;
○ A brief identification of the matter voted on;
○ Whether the matter was proposed by the Issuer or a security-holder;
○ Whether Crescent cast a vote;
○ How Crescent cast its vote (for the proposal, against the proposal, or abstain); and
○ Whether Crescent cast its vote with or against management.
● If Crescent votes the same proxy in two directions, the Portfolio Administration Group will maintain documentation describing the reasons for each vote (e.g., Crescent believes that voting with management is in Clients’ best interests, but Client X gave specific instructions to vote against management).
● Any attempt to influence the proxy voting process by Issuers or others not identified in these policies and procedures should be promptly reported to the CCO. Similarly, any Client’s attempt to influence proxy voting with respect to other Clients’ securities should be promptly reported to the CCO.
● Proxies received after a Client terminates its advisory relationship with Crescent will not be voted. The Portfolio Administration Group will promptly return such proxies to the sender, along with a statement indicating that Crescent’s advisory relationship with the Client has terminated, and that future proxies should not be sent to Crescent.
Legal Actions
From time to time, Crescent clients and former clients own or have owned securities that are the subject of class action lawsuits or bankruptcy proceedings. Generally, holders of securities within a given class period or bankruptcy are entitled to participate in the recovery or settlement in a lawsuit by filing a Proof of Claim. All class members normally are bound by a court-approved settlement or judgment unless they have filed a timely Opt Out notice with the court or claims administrator.
Crescent views filing of Proofs of Claim in lawsuits as a corporate action that normally is to be performed by the custodian for the client or fund. In addition, the decision to file an Opt Out notice is an individual decision to be made by the client or fund.
Normally, custodians will receive notices of rights to participate in, or opt out of class action settlements or bankruptcy proceedings. Crescent sometimes receives such notices and has adopted procedures to assist its clients and funds in the performance legal action processing functions. Crescent’s actions and responsibilities with respect to legal actions will depend on the role of the Firm with respect to the client or fund.
For Investment Advisory Accounts, Crescent will:
● not take responsibility for filing notices regarding Opt Out rights and Proofs of Claim on behalf of the Investment Advisory Account, and
● notify the Investment Advisory Account’s third party custodian, with a copy to the client/fund, of any Opt Out Notice or Proof of Claim received by Crescent from the settlement administrator or the court that is addressed to the Investment Advisory Account at Crescent’s address.
For Crescent/BNY Mellon Custodial Accounts:
● Crescent will distribute to its clients and funds notices regarding Opt Out rights relating to those clients and funds to the extent Crescent receives written notice of such rights.
● BNY Mellon will file Proofs of Claim for the Custodial Accounts except when the Account notifies Crescent that it intends to opt out (or has already opted out).
● Crescent has given BNY Mellon a standing instruction to file Proofs of Claim on behalf of Crescent/BNY Mellon Custodial
Accounts except where the account holder notifies the Firm of the exercise of its Opt Out right.
For Crescent Funds, if Crescent receives written notice of the right to participate in or opt out of, a legal action, the Firm will:
● notify the Product Group who will make the determination whether to exercise Opt Out rights relating to those Crescent Funds, and
● notify Legal of the timing and filing requirements for a Proof of Claim. Legal will coordinate with the Product Group’s analysts and/or custodian to ensure that the Proofs of Claim for the Funds are filed unless the Fund has elected to opt out of the class.
Portfolio Administration Group will present copies of all proxy voting material and notices of class action, bankruptcy and other security related proceedings to the Crescent Trading and Brokerage Committee at the Committee meeting immediately following the receipt of such materials.
Disclosures to Clients and Investors
Crescent includes a description of its policies and procedures regarding proxy voting and class actions in Part 2 of Form ADV, along with a statement that Clients and Investors can contact the Compliance Group to obtain a copy of these policies and procedures and information about how Crescent voted with respect to the Client’s securities.
Any request for information about proxy voting or class actions should be promptly forwarded to the Compliance Group, who will respond to any such requests.
As a matter of policy, Crescent does not disclose how it expects to vote on upcoming proxies. Additionally, Crescent does not disclose the way it voted proxies to unaffiliated third parties without a legitimate need to know such information.
Item 8. | Portfolio Managers of Closed-End Management Investment Companies. |
(a)(1) Identification of Portfolio Manager(s) or Management Team Members and Description of Role of Portfolio Manager(s) or Management Team Members.
The following table provides biographical information about the members of Cliffwater LLC (the “Investment Manager”) and Crescent Capital Group LP (the "Sub-Advisers"), who are primarily responsible for the day-to-day portfolio management of the Cliffwater Corporate Lending Fund as of March 22, 2022:
Name of Portfolio Management Team Member | Title | Length of Time of Service to the Fund | Business Experience During the Past 5 Years | Role of Portfolio Management Team Member |
Stephen L. Nesbitt | Chief Executive Officer and Chief Investment Officer | Since Inception | Chief Executive Officer, Chief Investment Officer, Cliffwater LLC (2004-Present) | Portfolio Management |
Jason A. Breaux | Managing Director | Since December 27, 2019 | Managing Director, Crescent Capital Group LP (2000-Present) | Portfolio Management |
John S. Bowman | Managing Director | Since December 27, 2019 | Managing Director, Crescent Capital Group LP (2012-Present) | Portfolio Management |
Christopher G. Wright | Managing Director | Since December 27, 2019 | Managing Director, Crescent Capital Group LP (2001-Present) | Portfolio Management |
(a)(2) Other Accounts Managed by Portfolio Manager(s) or Management Team Member and Potential Conflicts of Interest
The following table provides information about portfolios and accounts, other than the Cliffwater Corporate Lending Fund, for which the members of the Investment Committee of the Sub-Adviser are primarily responsible for the day-to-day portfolio management as of December 31, 2021:
Name of Portfolio Management Team Member | Number of Accounts and Total Value (in millions) of Assets for Which Advisory Fee is Performance-Based: | Number of Other Accounts Managed and Total Value (in millions) of Assets by Account Type for Which There is No Performance-Based Fee: | ||||
Name | Registered investment companies | Other pooled investment vehicles | Other accounts | Registered investment companies | Other pooled investment vehicles | Other accounts |
Stephen L. Nesbitt | 0 Accounts N/A | 0 Accounts N/A | 0 Accounts N/A | 1 Accounts $555 | 0 Accounts N/A | 15 Accounts $1,958 |
Jason A. Breaux | 2 Accounts $1,989 | 19 Accounts $3,477 | 2 Accounts $605 | 0 Accounts N/A | 0 Accounts N/A | 1 Account $339 |
John S. Bowman | 1 Account $501 | 23 Accounts $6,166 | 2 Account $710 | 0 Accounts N/A | 7 Accounts $1,211 | 2 Accounts $831 |
Christopher G. Wright | 1 Account $501 | 32 Accounts $11,811 | 2 Accounts $605 | 0 Accounts N/A | 7 Accounts $1,897 | 0 Accounts N/A |
Conflicts of Interest
The Investment Manager, Sub-Advisers and Portfolio Managers may manage multiple funds and/or other accounts, and as a result may be presented with one or more of the following actual or potential conflicts:
The management of multiple funds and/or other accounts may result in the Investment Manager, a Sub-Adviser or Portfolio Manager devoting unequal time and attention to the management of each fund and/or other account. The Investment Manager seeks to manage such competing interests for the time and attention of a Portfolio Manager by having the Portfolio Manager focus on a particular investment discipline. Other accounts managed by a Portfolio Manager may not be managed using the same investment models that are used in connection with the management of the Fund. If the Investment Manager, a Sub-Adviser or Portfolio Manager identifies a limited investment opportunity which may be suitable for more than one fund or other account, a fund may not be able to take full advantage of that opportunity due to an allocation of filled purchase or sale orders across all eligible funds and other accounts. To deal with these situations, the Investment Manager and Sub-Advisers have adopted procedures for allocating portfolio transactions across multiple accounts. The Investment Manager and Sub-Advisers have adopted certain compliance procedures which are designed to address these types of conflicts. However, there is no guarantee that such procedures will detect each and every situation in which a conflict arises.
(a)(3) Compensation Structure of Portfolio Manager
Cliffwater LLC - Stephen L. Nesbitt has ownership and financial interests in, and may receive compensation and/or variable profit distributions from, the Investment Manager based on the Investment Manager’s financial performance, such as its overall revenues and profitability. Mr. Nesbitt’s compensation is not tied to the Fund’s performance, except to the extent that the fee paid to the Investment Manager impacts the Investment Manager’s financial performance.
Crescent Capital Group LP - Crescent Capital typically compensates fund portfolio managers with a base salary, a targeted year-end bonus that is tied to performance, and an equity stake in Crescent Capital. Crescent Capital’s equity and compensation plan was designed based on the advice of a leading compensation consultant in the financial services industry. The equity stakes professionals receive are “real” equity, not phantom, and grow in value as the value of the company increases, creating incentives to attract, motivate, and retain employees. Crescent Capital may also provide the fund portfolio managers additional compensation in the form of fee sharing and incentive fees tied to performance. Portfolio manager compensation is not linked directly to asset growth. Nevertheless, the equity component of Crescent Capital’s compensation is tied to the overall profitability of the firm, which, in essence is correlated with the firm’s ability to grow assets. Crescent Capital does not believe that such a substantial part of the portfolio managers’ compensation is so directly tied to performance that there is an incentive to take undue risk with client assets.
(a)(4) Disclosure of Securities Ownership
Portfolio Management Team’s Ownership of Shares
Name of Portfolio Management Team Member: | Dollar Range of Shares Beneficially Owned by Portfolio Management Team Member1: |
Stephen L. Nesbitt | Over $1,000,000 |
Sinjin Bowron | None |
Jason A. Breaux | None |
John S. Bowman | None |
Christopher G. Wright | None |
1As of December 31, 2021
(b) Not Applicable
Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. |
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which shareholders may recommend nominees to the Fund’s Board of Directors since the Fund last provided disclosure in response to this item.
Item 11. Controls and Procedures.
(a) | The registrant’s President (Principal Executive Officer) and Treasurer (Principal Financial Officer) have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing date of this report, that includes the disclosure required by this paragraph, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 15d-15(b) under the Exchange Act. |
(b) | There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the most recent fiscal half-year period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. |
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
None.
Item 13. Exhibits.
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable.
(a)(4) Change in the registrant’s independent public accountant. Not applicable.
(b) Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith.
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(registrant) | Cliffwater Corporate Lending Fund | |
By (Signature and Title)* | /s/ Stephen Nesbitt | |
Stephen Nesbitt, President | ||
(Principal Executive Officer) | ||
Date | March 25, 2022 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.
By (Signature and Title)* | /s/ Stephen Nesbitt | |
Stephen Nesbitt, President | ||
(Principal Executive Officer) | ||
Date | March 25, 2022 | |
By (Signature and Title)* | /s/ Lance J. Johnson | |
Lance J. Johnson, Treasurer | ||
(Principal Financial Officer) | ||
Date | March 25, 2022 |