Monroe Capital Corp Files 2023 Annual Report on Form 10-K

Ticker: MRCC · Form: 10-K · Filed: Mar 11, 2024 · CIK: 1512931

Sentiment: neutral

Topics: 10-K, Monroe Capital, Financial Report, Risk Factors, Annual Filing

TL;DR

<b>Monroe Capital Corp has filed its 2023 10-K annual report detailing its financial performance and business operations.</b>

AI Summary

MONROE CAPITAL Corp (MRCC) filed a Annual Report (10-K) with the SEC on March 11, 2024. Monroe Capital Corp filed its 10-K report for the fiscal year ending December 31, 2023. The filing covers the period from January 1, 2023, to December 31, 2023. The company's principal business address is 311 South Wacker Drive, Suite 6400, Chicago, IL 60606. The company is incorporated in New York (NY). The filing includes references to various risk factors, including business and structure risks, investments related risks, common stock risks, and risks associated with its 2026 Notes.

Why It Matters

For investors and stakeholders tracking MONROE CAPITAL Corp, this filing contains several important signals. This 10-K filing provides a comprehensive overview of Monroe Capital Corp's financial health, operational strategies, and risk exposures for the fiscal year 2023, crucial for investors assessing the company's stability and future prospects. The detailed risk factors outlined in the report, such as those related to investments and debt instruments like the 2026 Notes, are essential for understanding potential challenges and their impact on the company's performance.

Risk Assessment

Risk Level: medium — MONROE CAPITAL Corp shows moderate risk based on this filing. The company's 10-K filing highlights various risk factors, including business and structure risks, investments-related risks, common stock risks, and risks associated with its 2026 Notes, indicating potential challenges that could impact financial performance.

Analyst Insight

Investors should review the detailed risk factors section of the 10-K to understand potential headwinds for Monroe Capital Corp in the upcoming fiscal year.

Key Numbers

Key Players & Entities

FAQ

When did MONROE CAPITAL Corp file this 10-K?

MONROE CAPITAL Corp filed this Annual Report (10-K) with the SEC on March 11, 2024.

What is a 10-K filing?

A 10-K is a comprehensive annual financial report required by the SEC, covering audited financials, business operations, risk factors, and management discussion. This particular 10-K was filed by MONROE CAPITAL Corp (MRCC).

Where can I read the original 10-K filing from MONROE CAPITAL Corp?

You can access the original filing directly on the SEC's EDGAR system. The filing is publicly available and includes all exhibits and attachments submitted by MONROE CAPITAL Corp.

What are the key takeaways from MONROE CAPITAL Corp's 10-K?

MONROE CAPITAL Corp filed this 10-K on March 11, 2024. Key takeaways: Monroe Capital Corp filed its 10-K report for the fiscal year ending December 31, 2023.. The filing covers the period from January 1, 2023, to December 31, 2023.. The company's principal business address is 311 South Wacker Drive, Suite 6400, Chicago, IL 60606..

Is MONROE CAPITAL Corp a risky investment based on this filing?

Based on this 10-K, MONROE CAPITAL Corp presents a moderate-risk profile. The company's 10-K filing highlights various risk factors, including business and structure risks, investments-related risks, common stock risks, and risks associated with its 2026 Notes, indicating potential challenges that could impact financial performance.

What should investors do after reading MONROE CAPITAL Corp's 10-K?

Investors should review the detailed risk factors section of the 10-K to understand potential headwinds for Monroe Capital Corp in the upcoming fiscal year. The overall sentiment from this filing is neutral.

Risk Factors

Filing Stats: 4,538 words · 18 min read · ~15 pages · Grade level 12.7 · Accepted 2024-03-11 16:42:14

Key Financial Figures

Filing Documents

Risk Factors

Item 1A. Risk Factors 36

Unresolved Staff Comments

Item 1B. Unresolved Staff Comments 70

Cybersecurity

Item 1C. Cybersecurity 70

Properties

Item 2. Properties 73

Legal Proceedings

Item 3. Legal Proceedings 73

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 73 PART II 74

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 74

[Reserved]

Item 6. [Reserved] 81

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 82

Quantitative and Qualitative Disclosures About Market Risk

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 110

Financial Statements and Supplementary Data

Item 8. Financial Statements and Supplementary Data 112

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 112

Controls and Procedures

Item 9A. Controls and Procedures 112

Other Information

Item 9B. Other Information 113

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 113 PART III 113

Directors, Executive Officers and Corporate Governance

Item 10. Directors, Executive Officers and Corporate Governance 113

Executive Compensation

Item 11. Executive Compensation 113

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 113

Certain Relationships and Related Transactions, and Director Independence

Item 13. Certain Relationships and Related Transactions, and Director Independence 113

Principal Accountant Fees and Services

Item 14. Principal Accountant Fees and Services 113 PART IV 114

Exhibits and Financial Statement Schedules

Item 15. Exhibits and Financial Statement Schedules 114

Form 10-K Summary

Item 16. Form 10-K Summary 119

Signatures

Signatures 120 2 Table of Contents CERTAIN DEFINITIONS Except as otherwise specified in this Annual Report on Form 10-K ("Annual Report"), the terms: "we," "us," "our" and the "Company" refer to Monroe Capital Corporation, a Maryland corporation, and its consolidated subsidiaries; MC Advisors refers to Monroe Capital BDC Advisors, LLC, our investment adviser and a Delaware limited liability company; MC Management refers to Monroe Capital Management Advisors, LLC, our administrator and a Delaware limited liability company; Monroe Capital refers to Monroe Capital LLC, a Delaware limited liability company, and its subsidiaries and affiliates; and SLF refers to MRCC Senior Loan Fund I, LLC, an unconsolidated Delaware limited liability company, in which we co-invest with Life Insurance Company of the Southwest ("LSW") primarily in senior secured loans.

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS This Annual Report on Form 10-K contains statements that constitute forward-looking statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements that are not historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Some of the statements in this Annual Report on Form 10-K constitute forward-looking statements because they relate to future events or our future performance or future financial condition. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our company, our industry, our beliefs and our assumptions. The forward-looking statements contained in this Annual Report on Form 10-K involve risks and uncertainties, including statements as to: our future operating results; our business prospects and the prospects of our portfolio companies; the dependence of our future success on the general economy and its impact on the industries in which we invest; the impact of the ongoing military conflict in the Middle East and Europe and general uncertainty surrounding the financial and political stability of the United States, the United Kingdom, the European Union and China; the impact of a protracted decline in the liquidity of credit markets on our business; the impact of increased competition; the impact of higher interest and inflation rates and the risk of recession on our business prospects and the prospects of our portfolio companies; our contractual arrangements and relationships with third parties; the valuation of our investments in portfolio companies, particularly those having no liquid trading market; actual and potential conflicts of interest with MC Advisors, MC Management and other affiliates of Monroe Capital; the ability of our portfolio companies to achieve their

BUSINESS

ITEM 1. BUSINESS FORMATION OF OUR COMPANY We are a Maryland corporation, formed February 9, 2011, for the purpose of purchasing an initial portfolio of loans from two funds managed by Monroe Capital, raising capital in our initial public offering, which was completed in October 2012 (the "Initial Public Offering"), and thereafter operating as an externally managed business development company ("BDC") under the Investment Company Act of 1940 (the "1940 Act"), as amended. We are a closed-end, non-diversified investment company that has elected to be treated as a BDC under the 1940 Act. In addition, for tax purposes we have elected to be treated as a regulated investment company ("RIC") under the U.S. Internal Revenue Code of 1986, as amended (the "Code"), commencing with our taxable year ended December 31, 2012. Public Offerings of Common Stock The Initial Public Offering consisted of the sale of 5,750,000 shares of our common stock at a price of $15.00 per share, resulting in net proceeds to us, net of underwriting discounts and commissions, of approximately $84.6 million. On July 22, 2013, we completed a public offering of an additional 4,000,000 shares of our common stock at a price of $14.05 per share. On August 20, 2013, we also sold an additional 225,000 shares of our common stock at a price of $14.05 per share pursuant to the underwriters' partial exercise of the over-allotment option. These issuances during the year ended December 31, 2013 provided us with proceeds, net of offering and underwriting costs, of $56.0 million. On April 20, 2015, we closed a public offering of 2,450,000 shares of our common stock at a public offering price of $14.85 per share, raising approximately $36.4 million in gross proceeds. On May 18, 2015, we completed the sale of an additional 367,500 shares of our common stock, at a public offering price of $14.85 per share, raising approximately $5.5 million in gross proceeds pursuant to the underwriters' exercise of the over-allotm

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