Business Context and Reporting Period
This Form 8-K was filed by GSC Investment Corp. (referred to as Saratoga Investment Corp. in metadata) on May 2, 2007, reporting events occurring on May 1, 2007. The Company is a Maryland corporation that recently completed an initial public offering of 7.25 million shares on March 23, 2007. The filing details the entry into material definitive agreements regarding asset acquisitions and debt financing.
Key Financial Metrics and Agreements
- Asset Acquisitions: The Company purchased $60 million in assets from GSC Partners CDO Fund Limited, consisting of first and second lien loans, senior secured bonds, and unsecured bonds.
- Total Portfolio: Since its IPO, the Company has purchased a portfolio of approximately $210 million in assets.
- Debt Financing: The Company entered into a credit agreement providing a term loan facility of $25,708,119 for its wholly owned subsidiary, GSC Investment Funding II LLC.
- Existing Debt Amendment: The Company amended its existing credit agreement with GSC Investment Funding LLC (dated April 11, 2007).
Material Changes
The primary material change reported is the expansion of the Company's asset portfolio and debt structure immediately following its IPO. The Company sold certain securities and loans to its subsidiary, GSC Funding II, while simultaneously acquiring $60 million in new assets from a CDO fund. Additionally, the Company secured a new term loan facility of approximately $25.7 million to support its operations.
Outlook, Risks, and Contingencies
The filing does not provide specific forward-looking guidance, revenue projections, or management commentary on future performance. The agreements contain customary negative covenants, representations, warranties, affirmative covenants, and events of default. The full terms of these agreements, which define the specific risks and contingencies, are incorporated by reference as Exhibits 10.1 through 10.4.
Investor Verification Checklist
- Verify the specific composition and credit quality of the $60 million asset purchase from GSC CDO.
- Review the full terms of the $25.7 million term loan facility (Exhibit 10.3) to understand interest rates, maturity, and covenants.
- Confirm the details of the asset sale from the Company to GSC Funding II and the impact on the Company's balance sheet.
- Examine Amendment No. 1 to the GSC Funding Credit Agreement (Exhibit 10.4) for changes to existing debt obligations.