AB 2020 Form 10-K

Investment Type Facility Type Commitment Expiration Date (1) Unfunded Commitment (2) Fair Value (3) Theranest, LLC Delayed Draw Term Loan 7/23/2020 $ 1,386,857 $ (20,803) Theranest, LLC Revolver 7/24/2023 $ 428,571 $ (8,571) TRGRP, Inc. Revolver 11/1/2023 $ 333,333 $ (6,667) Tropical Smoothie Cafe, LLC Revolver 9/24/2023 $ 96,435 $ — Tropical Smoothie Cafe, LLC Delayed Draw Term Loan 6/18/2021 $ 6,659,893 $ — Velocity Purchaser Corporation Revolver 12/1/2022 $ 193,237 $ — ZBS Alliance Animal Health, LLC Delayed Draw Term Loan 11/8/2025 $ 4,535,600 $ (90,712) ZBS Alliance Animal Health, LLC Revolver 11/8/2025 $ 181,424 $ (3,628) Total 1st Lien/Senior Secured Debt $ 71,406,720 $(1,007,901) Total $ 71,406,720 $(1,007,901) (1) Commitments are generally subject to borrowers meeting certain criteria such as compliance with covenants and certain operational metrics. These amounts may remain outstanding until the commitment period of an applicable loan expires, which may be shorter than its maturity. (2) Net of capitalized fees, expenses and original issue discount (“OID”). (3) A negative fair value was reflected as investments, at fair value in the consolidated statements of assets and liabilities. The negative fair value is the result of the capitalized discount on the loan. Co-investment Exemptive Order On August 6, 2018, the SEC granted the Fund relief sought in a new exemptive application that expands the co-investment exemptive relief previously granted to the Fund in October 2016 to allow the Fund to co-invest in portfolio companies with Affiliated Funds in a manner consistent with its investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors, subject to compliance with the Order. Pursuant to the Order, the Fund is permitted to co-invest with Affiliated Funds, which the new exemptive relief defines to include affiliated managed accounts, if, among other things, a “required majority” (as defined in Section 57(o) of the 1940 Act) of the Fund’s independent directors make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the transactions, including the consideration to be paid, are reasonable and fair to the Fund and the Fund’s stockholders and do not involve overreaching in respect of the Fund or the Fund’s stockholders on the part of any person concerned, and (2) the transaction is consistent with the interests of the Fund’s stockholders and is consistent with the Fund’s investment objective and strategies. The Fund intends to co-invest with Affiliated Funds, subject to the conditions included in the Order. Asset Coverage In accordance with the 1940 Act, the Fund has historically only been allowed to borrow amounts such that its “asset coverage,” as defined in the 1940 Act, is at least 200% after such borrowing, permitting the Fund to borrow up to one dollar for investment purposes for every one dollar of investor equity. “Asset coverage” generally refers to a company’s total assets, less all liabilities and indebtedness not represented by “senior securities,” as defined in the 1940 Act, divided by total senior securities representing indebtedness and, if applicable, preferred stock. “Senior securities” for this purpose includes borrowings from banks or other lenders, debt securities and preferred stock. On March 23, 2018, the SBCAA was signed into law. The SBCAA, among other things, modifies the applicable provisions of the 1940 Act to reduce the required asset coverage ratio applicable to BDCs from 200% to 150% subject to certain approval, time and disclosure requirements (including either stockholder approval or approval of a majority of the directors who are not interested persons of the BDC and who have no financial interest in the proposal). On July 5, 2018, the Board voted to approve the adoption of the reduced asset coverage ratio and separately recommended that Investors approve the reduced asset coverage requirements at the 2018 annual meeting of stockholders. On September 26, 2018, at the Fund’s 2018 annual meeting of stockholders, the Fund’s stockholders approved the reduction of the required minimum asset coverage ratio applicable to the Fund from 200% to 150%, which took effect on September 27, 2018. This reduction in the required minimum asset coverage ratio increases the amount of debt that the Fund is permitted to incur, permitting the Fund to borrow up to two dollars for investment purposes for every one dollar of investor equity. As of December 31, 2020, and December 31, 2019, the Fund had total senior securities of $360,908,354 and $229,836,633, respectively, consisting of borrowings under the Credit Facilities, secured borrowings and Notes, and had asset coverage ratios 80