This preliminary prospectus supplement relates to an effective registration statement under the Securities Act of 1933, as amended, but the information in this preliminary prospectus supplement is not complete and may be changed. This preliminary prospectus supplement and the accompanying prospectus are not an offer to sell and are not soliciting an offer to buy these securities in any jurisdiction where the offer and sale is not permitted.

Filed pursuant to Rule 497
Securities Act Registration No. 333-187324

Subject to Completion, dated September 3, 2013

Prospectus Supplement
(To Prospectus dated April 2, 2013)

6,000,000 Shares

MEDLEY CAPITAL CORPORATION

Common Stock

 

We are offering for sale 6,000,000 shares of our common stock. Our common stock is listed on the New York Stock Exchange (the “NYSE”) under the symbol “MCC.” The last reported sale price of our common stock on September 3, 2013 was $13.27 per share. As of June 30, 2013, our net asset value, or NAV, per share was $12.65. See “Price Range of Common Stock and Distributions.”

 

Investing in our common stock involves certain risks. See “Supplementary Risks” beginning on page S-6 of this prospectus supplement and “Risks” beginning on page 9 of the accompanying prospectus to read about factors you should consider before investing in our common stock.

Neither the Securities and Exchange Commission (the “SEC”) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

 

		Per Share				Total
Public offering price		$				$
Underwriting discount		$				$
Proceeds to us, before expenses		$				$

We have granted the underwriters the option to purchase up to an additional          shares from us on the same terms and conditions set forth above.

 

The underwriters expect to deliver the shares against payment in New York, New York on         , 2013.

Joint Book-Running Managers

Goldman, Sachs & Co.		Barclays		Credit Suisse		J.P. Morgan

Co-Managers

 

Prospectus Supplement dated               , 2013

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PROSPECTUS SUPPLEMENT

		Page
ABOUT THIS PROSPECTUS SUPPLEMENT			S-ii
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS			S-iii
PROSPECTUS SUPPLEMENT SUMMARY			S-1
THE OFFERING			S-5
SUPPLEMENTARY RISKS			S-6
USE OF PROCEEDS			S-7
FEES AND EXPENSES			S-8
CAPITALIZATION			S-10
PRICE RANGE OF COMMON STOCK AND DISTRIBUTIONS			S-11
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			S-13
UNDERWRITING			S-28
VALIDITY OF COMMON STOCK			S-32
EXPERTS			S-32
WHERE YOU CAN FIND MORE INFORMATION			S-32
INDEX TO FINANCIAL STATEMENTS			S-33

PROSPECTUS

		Page
PROSPECTUS SUMMARY			1
FEES AND EXPENSES			7
RISKS			9
FORWARD-LOOKING STATEMENTS			30
USE OF PROCEEDS			31
PRICE RANGE OF COMMON STOCK AND DISTRIBUTIONS			32
SELECTED FINANCIAL AND OTHER DATA			34
RATIO OF EARNINGS TO FIXED CHARGES			35
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			36
SENIOR SECURITIES			52
BUSINESS			53
INVESTMENTS AND PORTFOLIO COMPANIES			62
THE ADVISER			74
REGULATION			81
MANAGEMENT			88
CERTAIN RELATIONSHIPS AND TRANSACTIONS WITH RELATED PERSONS			96
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES			97
DETERMINATION OF NET ASSET VALUE			99
BROKERAGE ALLOCATIONS AND OTHER PRACTICES			101
TAX MATTERS			102
SALES OF COMMON STOCK BELOW NET ASSET VALUE			109
ISSUANCE OF WARRANTS OR SECURITIES TO SUBSCRIBE FOR OR CONVERTIBLE INTO SHARES OF OUR COMMON STOCK			114
DIVIDEND REINVESTMENT PLAN			115
DESCRIPTION OF OUR CAPITAL STOCK			117
DESCRIPTION OF OUR WARRANTS			119
DESCRIPTION OF OUR DEBT SECURITIES			120
DESCRIPTION OF OUR UNITS			133
PLAN OF DISTRIBUTION			134
CUSTODIAN AND TRANSFER AGENT			136
LEGAL MATTERS			136
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			136
AVAILABLE INFORMATION			136
PRIVACY PRINCIPLES			136
INDEX TO FINANCIAL STATEMENTS			F-1

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ABOUT THIS PROSPECTUS SUPPLEMENT

You should read this prospectus supplement along with the accompanying prospectus carefully before you invest in our common stock. This prospectus supplement and the accompanying prospectus contain the terms of this offering of common stock. The accompanying prospectus contains information about our securities generally, some of which does not apply to the common stock covered by this prospectus supplement. This prospectus supplement may add, update or change information contained in the accompanying prospectus. If the information in this prospectus supplement is inconsistent with any information contained in the accompanying prospectus, the information in this prospectus supplement will apply and will supersede the inconsistent information contained in the accompanying prospectus.

It is important for you to read and consider all of the information contained in this prospectus supplement and the accompanying prospectus before making your investment decision. See “Where You Can Find More Information” in this prospectus supplement.

We and the underwriters have not authorized any person to provide you with any information other than the information contained in this prospectus supplement and the accompanying prospectus that is required to be filed with the SEC. We and the underwriters take no responsibility for, and provide no assurance as to the reliability of, any other information that others may give to you. We and the underwriters are not making an offer to sell our common stock in any jurisdiction where the offer or sale is not permitted. You should assume that information appearing in this prospectus supplement and the accompanying prospectus is accurate only as of their respective dates. Our business, financial condition, results of operations and prospects may have changed since those dates. To the extent required by law, we will amend or supplement the information contained in this prospectus supplement and the accompanying prospectus.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Some of the statements in this prospectus supplement constitute forward-looking statements, which relate to future events or our future performance or financial condition. In addition to factors identified elsewhere in this prospectus supplement, including the risks set forth in the section entitled “The Offering” beginning on page S-5 of this prospectus supplement, the risks set forth in the section entitled “Supplementary Risks” on page S-6 of this prospectus supplement, and the “Risks” beginning on page 9 of the accompanying prospectus, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance:

This prospectus supplement, and other statements that we may make, may contain forward-looking statements with respect to future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as “trend”, “opportunity”, “pipeline”, “believe”, “comfortable”, “expect”, “anticipate”, “current”, “intention”, “estimate”, “position”, “assume”, “potential”, “outlook”, “continue”, “remain”, “maintain”, “sustain”, “seek”, “achieve” and similar expressions, or future or conditional verbs such as “will”, “would”, “should”, “could”, “may” or similar expressions.

Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and we assume no duty to and do not undertake to update forward-looking statements. These forward-looking statements do not meet the safe harbor for forward-looking statements pursuant to Section 27A of the Securities Act of 1933, as amended (the “Securities Act”). Actual results could differ materially from those anticipated in forward-looking statements, and future results could differ materially from historical performance, for any reason, including those described under “Risks” in the accompanying prospectus and the risks set forth in the section entitled “Supplementary Risks” on page S-6 of this prospectus supplement.

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PROSPECTUS SUPPLEMENT SUMMARY

This summary highlights selected information contained elsewhere in this prospectus supplement and the accompanying prospectus. This is only a summary and does not contain all of the information you should consider before investing in our common stock. You should read this prospectus supplement and the accompanying prospectus, especially the risks discussed under “Risks” in the accompanying prospectus and the risks set forth in the section entitled “Supplementary Risks” on page S-6 of this prospectus supplement, before making an investment decision.

Except as otherwise indicated, the terms “we”, “us”, “our”, “Medley Capital” and the “Company” in this prospectus supplement refer to Medley Capital Corporation, a Delaware corporation, and its subsidiaries for the periods after our consummation of the formation transaction, which occurred in January 2011, and to Medley Capital BDC LLC, a Delaware limited liability company, for the periods prior to our consummation of the formation transaction described in the accompanying prospectus. “MCC Advisors” and “Adviser” refer to MCC Advisors LLC, our investment adviser. “Medley” refers collectively to the activities and operations of Medley Capital LLC, MCC Advisors, associated investment funds and their respective affiliates.

Medley Capital Corporation

Medley Capital Corporation is a non-diversified closed end management investment company incorporated in Delaware that has elected to be treated and is regulated as a business development company (“BDC”) under the 1940 Act. We completed our initial public offering (“IPO”) and commenced operations on January 20, 2011. We have elected and qualified to be treated for U.S. federal income tax purposes as a regulated investment company (“RIC”) under subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with our first taxable year as a corporation, and we intend to operate in a manner so as to maintain our RIC tax treatment. We are externally managed and advised by our investment adviser, MCC Advisors LLC (“MCC Advisors”), pursuant to an investment management agreement.

Our investment objective is to generate current income and capital appreciation by lending directly to privately held middle market companies to help these companies fund acquisitions, growth or refinancing. We are a direct lender targeting private debt transactions ranging in size from $10 to $50 million to borrowers principally located in North America. Our portfolio generally consists of senior secured first lien loans and senior secured second lien loans. In many of our investments, we receive warrants or other equity participation features, which we believe increases the total investment returns.

Our investment activities are managed by our investment adviser, MCC Advisors, which is an investment adviser registered under the Investment Advisers Act of 1940, as amended. MCC Advisors is an affiliate of Medley and has offices in New York and San Francisco. MCC Advisors is responsible for sourcing investment opportunities, conducting industry research, performing diligence on potential investments, structuring our investments and monitoring our portfolio companies on an ongoing basis. MCC Advisors’ team draws on its expertise in lending to predominantly privately held borrowers in a range of sectors, including industrials and transportation, energy and natural resources, financials and real estate. In addition, MCC Advisors seeks to diversify our portfolio of loans by asset type, transaction size, industry and geography.

The members of our management, Brook Taube, Seth Taube and Andrew Fentress, also serve as the principals of MCC Advisors (“Principals”) and have worked together for over ten years, during which time they have focused on implementing their private debt strategy. We believe that MCC Advisors’ disciplined and consistent approach to origination, portfolio construction and risk management should allow it to continue to achieve compelling risk-adjusted returns for Medley Capital.

MCC Advisors also serves as our administrator and furnishes us with office space, equipment and other office services. The responsibilities of our administrator include overseeing our financial records, preparing reports to our stockholders and reports filed with the SEC and generally monitoring the payment of our expenses and the performance of administrative and professional services rendered to us by others.

Portfolio

The total value of our investments, including cash and cash equivalents, was $724.9 million at June 30, 2013. As of June 30, 2013, our portfolio consisted of investments in 56 portfolio companies with a fair value of approximately $686.4 million. As of June 30, 2013, our average portfolio company investment at fair value

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was approximately $12.3 million and our largest portfolio company investment at fair value was approximately $25.6 million. As of June 30, 2013, our income-bearing investment portfolio, which represented nearly 99.5% of our total portfolio, had a weighted average yield based upon cost of our portfolio investments of approximately 13.8%, and 44.6% of our income-bearing investment portfolio bore interest based on floating rates, such as LIBOR, and 55.4% bore interest at fixed rates.

The following table summarizes the amortized cost and the fair value of investments and cash and cash equivalents as of June 30, 2013 (dollars in thousands):

		Amortized Cost				Percentage of Total				Fair Value				Percentage of Total
Senior Secured First Lien Term Loans		$	336,222				47.4 %			$	327,836				46.8 %
Senior Secured Second Lien Term Loans			272,449				38.4				271,441				38.8
Senior Secured Notes			84,841				12.0				84,306				12.0
Unsecured Debt			252				0.1				252				0.1
Equity/Warrants			1,811				0.2				2,540				0.4
Cash and Cash Equivalents			13,459				1.9				13,459				1.9
Total		$	709,034				100.0 %			$	699,834				100.0 %

Investment Strategy

We believe that a well-structured portfolio of private debt transactions can generate equity-like returns with the risk profile of secured debt. Private debt combines attractive elements of both equity and fixed-income investments because transactions are generally structured as secured loans with equity upside in the form of options, warrants, cash flow sharing, co-investment rights or other participation features. As a result, we believe our private debt strategy offers upside potential, similar to mezzanine and private equity investments, and downside protection, similar to bank loans.

We believe that private debt offers an attractive investment opportunity for the following reasons:

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Market Opportunity

We believe the credit crises that began in 2007 and the subsequent exit of traditional lending sources have created a compelling opportunity for skilled debt providers in the middle-market. We expect to take advantage of the following favorable trends in private lending:

Competitive Advantages

We believe that the Company represents an attractive investment opportunity for the following reasons:

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Corporate Information

Our administrative and executive offices are located at 375 Park Avenue, 33rd Floor, New York, NY 10152, and our telephone number is (212) 759-0777. We maintain a website at http://www.medleycapitalcorp.com. Information contained on our website is not incorporated by reference into this prospectus supplement, and you should not consider information contained on our website to be part of this prospectus supplement.

Recent Developments

On July 31, 2013, the Company’s board of directors declared a quarterly dividend of $0.37 per share payable on September 13, 2013, to stockholders of record at the close of business on August 23, 2013.

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THE OFFERING

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SUPPLEMENTARY RISKS

Investing in the common stock involves a high degree of risk. In addition to the other information contained in this prospectus supplement and the accompanying prospectus, you should carefully consider the following supplementary risks together with the risk factors set forth in the accompanying prospectus before making an investment. The risk factors set out below and in the accompanying prospectus are not the only risks we face. Additional risks and uncertainties not presently known to us might also impair our operations and performance. If any of the events described herein or in the accompanying prospectus occur, our business, financial condition and results of operations could be materially and adversely affected. In such case, our net asset value and the market price of our common stock could decline, and you may lose part or all of your investment.

Risks Related to Our Business

It is unclear how increased regulatory oversight and changes in the method for determining LIBOR may affect the value of the financial obligations to be held or issued by us that are linked to LIBOR, or how such changes could affect our results of operations or financial condition.

As a result of concerns about the accuracy of the calculation of LIBOR, a number of British Bankers’ Association, or BBA, member banks entered into settlements with certain regulators and law enforcement agencies with respect to the alleged manipulation of LIBOR, and there are ongoing investigations by regulators and governmental authorities in various jurisdictions. Following a review of LIBOR conducted at the request of the U.K. government, on September 28, 2012, recommendations for reforming the setting and governing of LIBOR were released, which are referred to as the Wheatley Review. The Wheatley Review made a number of recommendations for changes with respect to LIBOR, including the introduction of S-5 statutory regulation of LIBOR, the transfer of responsibility for LIBOR from the BBA to an independent administrator, changes to the method of the compilation of lending rates and new regulatory oversight and enforcement mechanisms for rate-setting and a reduction in the number of currencies and tenors for which LIBOR is published. Based on the Wheatley Review and on a subsequent public and governmental consultation process, on March 25, 2013, the U.K. Financial Services Authority published final rules for the U.K. Financial Conduct Authority’s regulation and supervision of LIBOR, which are referred to as the FCA Rules. In particular, the FCA Rules include requirements that (1) an independent LIBOR administrator monitor and survey LIBOR submissions to identify breaches of practice standards and/or potentially manipulative behavior, and (2) firms submitting data to LIBOR establish and maintain a clear conflicts of interest policy and appropriate systems and controls. The FCA Rules took effect on April 2, 2013. It is uncertain what additional regulatory changes or what changes, if any, in the method of determining LIBOR may be required or made by the U.K. government or other governmental or regulatory authorities. Accordingly, uncertainty as to the nature of such changes may adversely affect the market for or value of any LIBOR-linked securities, loans, derivatives and other financial obligations or extensions of credit held by or due to us or on our overall financial condition or results of operations. In addition, any further changes or reforms to the determination or supervision of LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR, which could have an adverse impact on the market for or value of any LIBOR-linked securities, loans, derivatives and other financial obligations or extensions of credit held by or due to us or on our overall financial condition or results of operations.

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USE OF PROCEEDS

The net proceeds of the offering are estimated to be approximately $           (approximately $           if the underwriters exercise their option to purchase additional shares in full), after deducting the underwriting discounts and commissions and estimated offering expenses of approximately $200,000 payable by us. We intend to use the net proceeds from the sale of the shares to fund new investment opportunities, to repay the outstanding indebtedness under our Revolving Facility, and for general corporate purposes. Certain of the underwriters and/or their affiliates are lenders under our Revolving Facility and may receive a portion of the net proceeds from this offering. As of September 3, 2013, we had $39.6 million outstanding under our Revolving Facility. We intend to reborrow under our Revolving Facility to make investments in portfolio companies in accordance with our investment objective.

Outstanding indebtedness under our Revolving Facility bears interest, as of August 30, 2013, at LIBOR plus 3.25% annum, with no LIBOR floor, which equals 3.50%. The indebtedness under the Revolving Facility was incurred to make investments in portfolio companies in accordance with our investment objective.

We expect to continue to borrow under our Revolving Facility to make investments in portfolio companies in accordance with our investment objective depending on the availability of appropriate investment opportunities consistent with our investment objective and market conditions.

Pending investments as described above, we will invest any remaining net proceeds of this offering primarily in cash, cash equivalents, U.S. Government securities and other high-quality debt instruments that mature in one year or less, or “temporary investments”, as appropriate. These securities may have lower yields than our other investments and accordingly result in lower distributions, if any, by us during such period. See “Regulation — Temporary Investments” and “The Adviser — Investment Management Agreement” in the accompanying prospectus.

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FEES AND EXPENSES

The following table is intended to assist you in understanding the costs and expenses that you will bear directly or indirectly. We caution you that some of the percentages indicated in the table below are estimates and may vary. Except where the context suggests otherwise, whenever this prospectus contains a reference to fees or expenses paid by “us” or “Medley Capital,” or that “we” will pay fees or expenses, our common stockholders will indirectly bear such fees or expenses.

Stockholder transaction expenses:
Sales load borne by us (as a percentage of offering price)				%
Offering expenses borne by us (as a percentage of offering price)				%
Dividend reinvestment plan expenses			None	(1)
Total stockholder transaction expenses (as a percentage of offering price)				%
Annual expenses (as a percentage of net assets attributable to common stock):
Base management fee			2.42	%(2)
Incentive fees payable under our Investment Management Agreement			2.55	%(3)
Interest payments on borrowed funds			4.01	%(4)
Other expenses (estimated)			1.45	%(5)
Total annual expenses			10.43	%

EXAMPLE

The following example demonstrates the projected dollar amount of total cumulative expenses that would be incurred over various periods with respect to a hypothetical investment in our common stock. In calculating the following expense amounts, we have assumed that our annual operating expenses would remain at the levels set forth in the table above. See Note 4 below for additional information regarding certain assumptions regarding our level of leverage.

		1 Year				3 Years				5 Years				10 Years
You would pay the following expenses on a $1,000 investment, assuming a 5% annual return		$	114			$	321			$	503			$	863

The first component, which is payable quarterly in arrears, will equal 20.0% of the excess, if any, of our “Pre-Incentive Fee Net Investment Income” over a 2.0% quarterly (8.0% annualized) hurdle rate and a “catch-up” provision measured as of the end of each calendar quarter. Under this provision, in any calendar quarter, our investment adviser receives no incentive fee until our net investment income equals the hurdle rate of 2.0% but then receives, as a “catch-up”, 100% of our pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the hurdle rate but is less than 2.5%. The effect of this provision is that, if pre-incentive fee net investment income exceeds 2.5% in any calendar quarter, our investment adviser will receive 20% of our pre-incentive fee net investment income as if a hurdle rate did not apply. The first component of the incentive fee will be computed and paid on income that may include interest that is accrued but not yet received in cash. Since the hurdle rate is fixed, as interest rates rise, it will be easier for the Adviser to surpass the hurdle rate and receive an incentive fee based on net investment income.

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The second component of the incentive fee will equal 20.0% of our “Incentive Fee Capital Gains”, if any, which will equal our realized capital gains on a cumulative basis from inception through the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees. The second component of the incentive fee will be payable, in arrears, at the end of each calendar year (or upon termination of the investment management agreement, as of the termination date).

For a more detailed discussion of the calculation of this fee, see “The Adviser — Investment Management Agreement” in the accompanying prospectus.

The example and the expenses in the tables above should not be considered a representation of our future expenses, and actual expenses may be greater or less than those shown. While the example assumes, as required by the SEC, a 5% annual return, our performance will vary and may result in a return greater or less than 5%. The example assumes that the 5% annual return will be generated entirely through the realization of capital gains on our assets and, as a result, will trigger the payment of “Incentive Fee Capital Gains” under our investment management agreement. The “Pre-Incentive Fee Net Investment Income” under our investment management agreement, which, assuming a 5% annual return, would either not be payable or have a de minimis effect, is nonetheless included in the example for illustrative purposes based upon the estimated annual expenses relating thereto as set forth above. If we achieve sufficient returns on our investments to trigger a “Pre-Incentive Fee Net Investment Income” of a material amount, our expenses, and returns to our investors, would be higher. In addition, while the example assumes reinvestment of all cash dividends and other cash distributions at NAV, participants in our dividend reinvestment plan will receive a number of shares of our common stock determined by dividing the total dollar amount of the distribution payable to a participant by the greater of (i) NAV per share, and (ii) 95% of the market price per share of our common stock at the close of regular trading on the NYSE on the payment date fixed by our board of directors for such distribution. The market price per share on that date shall be the closing price for such shares on the NYSE or, if no sale is reported for such day, at the average of their electronically-reported bid and asked prices. See “Dividend Reinvestment Plan” in the accompanying prospectus for additional information regarding our dividend reinvestment plan.

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CAPITALIZATION

The following table sets forth as of June 30, 2013:

This table should be read in conjunction with our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and notes thereto included in the accompanying prospectus.

		As of June 30, 2013
		Actual				As Adjusted
		(unaudited)
Cash and cash equivalents		$	13,458,925			$
Revolving credit facility payable			54,700,000
Term loan facility payable			115,000,000
7.125% notes due 2019			40,000,000
6.125% notes due 2023			63,500,000
SBA Debentures			5,000,000
Payable for investments purchased			15,000,000
Management and incentive fees payable, net			5,984,655
Accounts payable and accrued expenses			1,635,812
Administrator expenses payable			681,924
Deferred revenue			181,315
Interest and fees payable			2,813,939
Due to affiliate			24,028
Offering costs payable			83,054
Total liabilities			304,604,727
Common stock, par value $.001 per share, 100,000,000 shares authorized, 33,226,126 shares issued and outstanding (actual),         shares issued and outstanding (as adjusted)		$	33,226			$
Capital in excess of par value			422,205,081
Accumulated undistributed net investment income			7,014,978
Accumulated net realized gain from investments			192,713
Net unrealized depreciation on investments			(9,199,904	)
Total net assets			420,246,094
Total liabilities and net assets		$	724,850,821			$

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PRICE RANGE OF COMMON STOCK AND DISTRIBUTIONS

Price Range

Our common stock began trading on January 20, 2011, and is currently traded on the NYSE under the symbol “MCC”. The following table lists the high and low closing sale price for our common stock, the closing sale price as a percentage of NAV and quarterly dividends per share since shares of our common stock began being regularly quoted on the NYSE.

Period		NAV(1)				Closing Sales Price								Premium/ Discount of High Sales Price to NAV(2)				Premium/ Discount of Low Sales Price to NAV(2)				Declared Dividends(3)
						High				Low
Fiscal year ended September 30, 2011
Second quarter(4)		$	12.48			$	12.19			$	11.62				(2.32	)%			(6.89	)%		$	0.16
Third quarter		$	12.55			$	12.19			$	11.12				(2.87	)%			(11.39	)%		$	0.21
Fourth quarter		$	12.57			$	11.63			$	9.84				(7.48	)%			(21.72	)%		$	0.25
Fiscal year ending September 30, 2012
First Quarter		$	12.57			$	10.56			$	8.96				(15.99	)%			(28.72	)%		$	0.28
Second Quarter		$	12.63			$	11.86			$	10.17				(6.10	)%			(19.48	)%		$	0.31
Third Quarter		$	12.60			$	12.04			$	10.72				(4.44	)%			(14.92	)%		$	0.36
Fourth Quarter		$	12.52			$	14.36			$	11.91				14.70	%			(4.87	)%		$	0.36
Fiscal year ending September 30, 2013
First Quarter		$	12.69			$	14.62			$	12.99				15.21	%			2.36	%		$	0.36
Second Quarter		$	12.73			$	16.15			$	14.46				26.87	%			13.59	%		$	0.36
Third Quarter		$	12.65			$	15.65			$	13.06				23.72	%			3.24	%		$	0.37
Fourth Quarter (through          , 2013)		$	*			$	—			$	—				*				*			$	*

The last reported price for our common stock on September 3, 2013 was $13.27 per share. As of August 29, 2013 we had 17 stockholders of record. As of June 30, 2013, our net asset value per share was $12.65.

Distributions

Our dividends, if any, are determined by the board of directors. We have elected and qualified to be treated as a RIC under Subchapter M of the Code. To maintain RIC qualification, we must timely distribute to our stockholders at least 90% of our net ordinary income and realized net short-term capital gains in excess of our realized net long-term capital losses, if any, for each year. We will be subject to a 4% nondeductible federal excise tax on our undistributed income unless we distribute to our stockholders in a timely manner an amount at least equal to the sum of (1) 98% of our net ordinary income for each calendar year, (2) 98.2% of our capital gain net income (both long-term and short-term) for the one-year period ending October 31 in that calendar year and (3) any income realized, but not distributed in the preceding year.

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The following table reflects the cash distributions, including dividends and returns of capital per share, that we have declared on our common stock since completion of our IPO.

Dividends Declared

Period		Payment Dates				Per Share
Fiscal year ended September 30, 2011
Second quarter(1)			June 15, 2011			$	0.16
Third quarter			September 15, 2011			$	0.21
Fourth quarter			December 30, 2011			$	0.25
Total						$	0.62
Fiscal year ending September 30, 2012
First quarter			March 15, 2012			$	0.28
Second quarter			June 15, 2012			$	0.31
Third quarter			September 14, 2012			$	0.36
Fourth quarter			December 14, 2012			$	0.36
Total						$	1.31
Fiscal year ending September 30, 2013
First quarter			March 15, 2013			$	0.36
Second quarter			June 14, 2013			$	0.36
Third quarter			September 13, 2013			$	0.37

We have adopted a dividend reinvestment plan that provides for reinvestment of our dividends and other distributions on behalf of our stockholders, unless a stockholder elects to receive cash as provided below. As a result, if our board of directors authorizes, and we declare, a cash dividend or other distribution, then our stockholders who have not “opted out” of our dividend reinvestment plan will have their cash distribution automatically reinvested in additional shares of our common stock, rather than receiving the cash distribution. See “Dividend Reinvestment Plan” beginning on page 115 of the accompanying prospectus.

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MANAGEMENT’S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

For information regarding the fiscal year ended September 30, 2012, see “Management’s Discussion and Analysis of Financial Condition and Results of Operation” beginning on page 36 of the accompanying prospectus.

Formation Transaction

Prior to the pricing of our initial public offering, Medley Opportunity Fund LP (“MOF LP”) and Medley Opportunity Fund, Ltd. (“MOF LTD”) transferred all of their respective interests in six loan participations in secured loans to middle market companies with a combined fair value, plus payment-in-kind interest and accrued interest thereon, of approximately $84.95 million (the “Loan Assets”) to MOF I BDC LLC (“MOF I BDC”) in exchange for membership interests in MOF I BDC. As a result, MOF LTD owned approximately 90% of the outstanding MOF I BDC membership interests and MOF LP owned approximately 10% of the outstanding MOF I BDC membership interests. On January 18, 2011, each of MOF LTD and MOF LP contributed their respective MOF I BDC membership interests to Medley Capital BDC LLC in exchange for Medley Capital BDC LLC membership interests. As a result, MOF I BDC became a wholly-owned subsidiary of Medley Capital BDC LLC.

On January 18, 2011, Medley Capital BDC LLC, a Delaware limited liability company, converted into Medley Capital Corporation, a Delaware corporation. As a result, MOF LTD and MOF LP’s LLC membership interests were exchanged for 5,759,356 shares of the Company’s common stock at $14.75 per share. On January 20, 2011, Medley Capital Corporation filed an election to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (“1940 Act”).

On January 20, 2011, we priced our initial public offering and sold 11,111,112 shares of our common stock at $12.00 per share. On February 24, 2011, an additional 450,000 shares of our common stock were sold at a price of $12.00 per share pursuant to the partial exercise of the underwriters’ over-allotment option. Net of underwriting fees and estimated offering costs, we raised a total of approximately $129.6 million. Our shares began trading on January 20, 2011 on the New York Stock Exchange under the symbol “MCC.”

Overview

We are an externally-managed, non-diversified closed-end management investment company that filed an election to be regulated as a BDC under the 1940 Act. In addition, we have elected and qualified to be treated for U.S. federal income tax purposes as a RIC under subchapter M of the Code.

We commenced operations and completed our initial public offering on January 20, 2011. Our investment activities are managed by MCC Advisors and supervised by our board of directors, of which a majority of the members are independent of us.

Our investment objective is to generate current income and capital appreciation by lending directly and indirectly to privately-held middle market companies to help these companies fund acquisitions, growth or refinancing. Our portfolio generally consists of senior secured first lien term loans and senior secured second lien term loans. In many of our investments, we receive warrants or other equity participation features which we believe will increase the total investment returns.

As a BDC, we are required to comply with certain regulatory requirements. For instance, we generally have to invest at least 70% of our total assets in “qualifying assets,” including securities of private or thinly traded public U.S. companies, cash, cash equivalents, U.S. government securities and high-quality debt investments that mature in one year or less. In addition, we are only allowed to borrow money such that our asset coverage, as defined in the 1940 Act, equals at least 200% after such borrowing, with certain limited exceptions. To maintain our RIC status, we must meet specified source-of-income and asset diversification requirements and we must timely distribute to our stockholders at least 90% of our net ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, if any, for the taxable year.

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Revenues

We generate revenue in the form of interest income on the debt that we hold and capital gains, if any, on warrants or other equity interests that we may acquire in portfolio companies. We invest our assets primarily in privately held companies with enterprise or asset values between $25 million and $250 million and focus on investment sizes of $10 million to $50 million. We believe that pursuing opportunities of this size offers several benefits including reduced competition, a larger investment opportunity set and the ability to minimize the impact of financial intermediaries. We expect our debt investments to bear interest at either a fixed or floating rate. Interest on debt will be payable generally either monthly or quarterly. In some cases our debt investments may provide for a portion of the interest to be PIK. To the extent interest is PIK, it will be payable through the increase of the principal amount of the obligation by the amount of interest due on the then-outstanding aggregate principal amount of such obligation. The principal amount of the debt and any accrued but unpaid interest will generally become due at the maturity date. In addition, we may generate revenue in the form of commitment, origination, structuring or diligence fees, fees for providing managerial assistance or investment management services and possibly consulting fees. Any such fees will be generated in connection with our investments and recognized as earned.

Expenses

Our primary operating expenses include the payment of management and incentive fees pursuant to the investment management agreement we have with MCC Advisors and overhead expenses, including our allocable portion of our administrator’s overhead under the administration agreement. Our management and incentive fees compensate MCC Advisors for its work in identifying, evaluating, negotiating, closing and monitoring our investments. We bear all other costs and expenses of our operations and transactions, including those relating to:

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Portfolio and Investment Activity

As of June 30, 2013, our portfolio consisted of investments in 56 portfolio companies with a fair value of approximately $686.4 million. During the three months ended June 30, 2013, we invested $117.1 million in eight new portfolio companies and $1.9 million in two existing portfolio companies, and we had $22.5 million in aggregate amount of exits and repayments, resulting in net investments of $96.5 million for the period. During the three months ended June 30, 2012, we invested $63.2 million in five new portfolio companies and $4.3 million in three existing portfolio companies. Also, during the three months ended June 30, 2012, we had $10.3 million in aggregate amount of exits and repayments, resulting in net investments of $57.2 million for the period.

During the nine months ended June 30, 2013, we invested $324.0 million in 27 new portfolio companies and $51.4 million in 12 existing portfolio companies, and we had $92.3 million in aggregate amounts of exits and repayments, resulting in net investments of $283.1 million for the period. During the nine months ended June 30, 2012 we invested $177.0 million in seventeen new portfolio companies and $12.3 million in five existing portfolio companies, and we had $26.6 million in aggregate amount of exits and repayments, resulting in net investments of $162.7 million for the period.

As of June 30, 2013, our average portfolio company investment and our largest portfolio company investment at amortized cost and fair value was approximately $12.4 million and $12.3 million, and $25.4 million and $25.6 million, respectively, and the Company had approximately $13.5 million of cash and cash equivalents.

The following table summarizes the amortized cost and the fair value of investments and cash and cash equivalents as of June 30, 2013 (dollars in thousands):

		Amortized Cost				Percentage of Total				Fair Value				Percentage of Total
Senior Secured First Lien Term Loans		$	336,222				47.4 %			$	327,836				46.8 %
Senior Secured Second Lien Term Loans			272,449				38.4				271,441				38.8
Senior Secured Notes			84,841				12.0				84,306				12.0
Unsecured Debt			252				0.1				252				0.1
Equity/Warrants			1,811				0.2				2,540				0.4
Cash and Cash Equivalents			13,459				1.9				13,459				1.9
Total		$	709,034				100.0 %			$	699,834				100.0 %

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The following table summarizes the amortized cost and the fair value of investments and cash and cash equivalents as of September 30, 2012 (dollars in thousands):

		Amortized Cost				Percentage of Total				Fair Value				Percentage of Total
Senior Secured First Lien Term Loans		$	187,753				46.0 %			$	186,841				45.9 %
Senior Secured Second Lien Term Loans			158,076				38.7				157,015				38.6
Senior Secured Notes			55,381				13.6				55,750				13.7
Equity/Warrants			1,950				0.5				2,343				0.6
Cash and Cash Equivalents			4,894				1.2				4,894				1.2
Total		$	408,054				100.0 %			$	406,843				100.0 %

As of June 30, 2013, the weighted average loan to value ratio (“LTV”) of our portfolio investments was approximately 56.4%. We believe that the LTV ratio for a portfolio investment is a useful indicator of the riskiness of the portfolio investment, or its likelihood of default. As part of our investment strategy, we seek to structure transactions with downside protection and seek LTVs of lower than 65%. We regularly evaluate the LTV of our portfolio investments and believe that LTV is a useful indicator for management and investors.

As of June 30, 2013, our income-bearing investment portfolio, which represented nearly 99.5% of our total portfolio, had a weighted average yield based upon cost of our portfolio investments of approximately 13.8%, and 44.6% of our income-bearing investment portfolio bore interest based on floating rates, such as LIBOR, and 55.4% bore interest at fixed rates.

MCC Advisors regularly assesses the risk profile of each of our investments and rates each of them based on the following categories, which we refer to as MCC Advisors’ investment credit rating:

Credit Rating		Definition
1		Investments that are performing above expectations.
2		Investments that are performing within expectations, with risks that are neutral or favorable compared to risks at the time of origination.
		All new loans are rated ‘2’.
3		Investments that are performing below expectations and that require closer monitoring, but where no loss of interest, dividend or principal is expected.
		Companies rated ‘3’ may be out of compliance with financial covenants, however, loan payments are generally not past due.
4		Investments that are performing below expectations and for which risk has increased materially since origination.
		Some loss of interest or dividend is expected but no loss of principal.
		In addition to the borrower being generally out of compliance with debt covenants, loan payments may be past due (but generally not more than 180 days past due).
5		Investments that are performing substantially below expectations and whose risks have increased substantially since origination.
		Most or all of the debt covenants are out of compliance and payments are substantially delinquent.
		Some loss of principal is expected.

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The following table shows the distribution of our investments on the 1 to 5 investment performance rating scale at fair value as of June 30, 2013 (dollars in thousands):

Investment Performance Rating		Investments at Fair Value				Percentage
1		$	45,339				6.6 %
2			587,391				85.6
3			42,886				6.2
4			6,669				1.0
5			4,090				0.6
Total		$	686,375				100.0 %

The following table shows the distribution of our investments on the 1 to 5 investment performance rating scale at fair value as of September 30, 2012 (dollars in thousands):

Investment Performance Rating		Investments at Fair Value				Percentage
1		$	17,230				4.3 %
2			354,577				88.2
3			30,142				7.5
4			—				—
5			—				—
Total		$	401,949				100.0 %

Results of Operations

Operating results for the three and nine months ended June 30, 2013 and 2012 are as follows (dollars in thousands):

		For the three months ended
		June 30, 2013				June 30, 2012
Total investment income		$	23,591			$	12,252
Total expenses, net			11,561				6,044
Net investment income before excise taxes			12,030				6,208
Excise tax expense			—				—
Net investment income			12,030				6,208
Net realized gains (losses)			(137 )				(15 )
Net unrealized gains (losses)			(8,736 )				(1,353 )
Net increase in net assets resulting from operations		$	3,157			$	4,840

		For the nine months ended
		June 30, 2013				June 30, 2012
Total investment income		$	61,518			$	30,455
Total expenses, net			29,474				14,011
Net investment income before excise taxes			32,044				16,444
Excise tax expense			—				36
Net investment income			32,044				16,408
Net realized gains (losses)			237				93
Net unrealized gains (losses)			(7,988 )				(1,434 )
Net increase in net assets resulting from operations		$	24,293			$	15,067

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Investment Income

For the three and nine months ended June 30, 2013, investment income totaled $23.6 million and $61.5 million, respectively, of which $20.0 million and $51.5 million was attributable to portfolio interest and $3.6 million and $10.0 million to other fee income.

For the three and nine months ended June 30, 2012, investment income totaled $12.3 million and $30.5 million, respectively, of which $10.4 million and $26.0 million was attributable to portfolio interest and $1.9 million and $4.5 million to other fee income.

Operating Expenses

Operating expenses for the three and nine months ended June 30, 2013 and 2012 were as follows (dollars in thousands):

		For the three months ended
		June 30, 2013				June 30, 2012
Base management fees		$	2,977			$	1,498
Incentive fees			3,008				1,552
Interest and financing expenses			4,032				1,781
Administrator expenses			682				396
Professional fees			320				470
Directors fees			71				131
Insurance			70				121
General and administrative			399				95
Organizational Expense			2				—
Expenses before management fee waiver(1)		$	11,561			$	6,044

		For the nine months ended
		June 30, 2013				June 30, 2012
Base management fees		$	7,607			$	3,782
Incentive fees			8,011				4,111
Interest and financing expenses			9,283				2,891
Administrator expenses			1,773				1,074
Professional fees			1,161				1,102
Directors fees			315				378
Insurance			210				343
General and administrative			963				372
Organizational Expense			151				—
Expenses before management fee waiver(1)		$	29,474			$	14,053

For the three months ended June 30, 2013, total operating expenses before manager expense waiver and reimbursement increased by $5.5 million, or 91.3%, compared to the three months ended June 30, 2012. For the nine months ended June 30, 2013, total operating expenses before manager expense waiver and reimbursement increased by $15.4 million, or 109.7%, compared to the nine months ended June 30, 2012.

Interest and financing expenses were higher in the three and nine months ended June 30, 2013 than the three and nine months ended June 30, 2012 as a result of an increase in the commitments under a four-year senior secured revolving credit facility, issuing $40.0 million in aggregate principal amount of 7.125% unsecured notes that mature on March 30, 2019, entering into a new five-year senior secured term loan credit facility, issuing $63.5 million in aggregate principal amount of 6.125% unsecured notes that mature on March 30, 2023 and issuing SBA-guaranteed debentures.

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Excluding interest and financing expenses, expenses increased for both the three and nine months ended June 30, 2013, due to an increase in base management fees, incentive fees, administrative service fees, general administrative expenses and organizational expenses. Base management fees, which are calculated based on average gross assets, increased due to the growth in the portfolio throughout the period. The incentive fee increased as a result of the increase in pre-incentive fee net investment income.

Net Realized Gains/Losses from Investments

We measure realized gains or losses by the difference between the net proceeds from the disposition and the amortized cost basis of an investment, without regard to unrealized gains or losses previously recognized.

During the three and nine months ended June 30, 2013, we recognized $0.1 million of realized losses and $0.2 million realized gains on our portfolio investments, respectively. During the three and nine months ended June 30, 2012, we recognized $15,016 of realized losses and $0.1 million of realized gains, respectively, on portfolio investments.

Net Unrealized Appreciation/Depreciation on Investments

Net change in unrealized appreciation on investments reflects the net change in the fair value of our investment portfolio. For the three and nine months ended June 30, 2013, we had $8.7 million and $8.0 million of unrealized depreciation, respectively, on portfolio investments. For the three and nine months ended June 30, 2012, we had $1.4 million and $1.4 million of unrealized depreciation, respectively, on portfolio investments.

Changes in Net Assets from Operations

For the three months ended June 30, 2013, we recorded a net increase in net assets resulting from operations of $3.2 million versus a net increase in net assets resulting from operations of $4.8 million for the three months ended June 30, 2012. The difference is attributable to an increase in total investment income offset by an increase in total operating expenses, resulting from portfolio growth and an increase in net unrealized depreciation for the three months ended June 30, 2013, as compared to the same period in the prior year. Based on 32,658,336 and 17,320,468 weighted average common shares outstanding for the three months ended June 30, 2013 and 2012, respectively, our per share net increase in net assets resulting from operations was $0.10 for the three months ended June 30, 2013, versus a per share net increase in net assets from operations of $0.28 for the three months ended June 30, 2012.

For the nine months ended June 30, 2013, we recorded a net increase in net assets resulting from operations of $24.3 million versus a net increase in net assets resulting from operations of $15.1 million for the nine months ended June 30, 2012. The difference is attributable to an increase in total investment income offset by an increase in total operating expenses, resulting from portfolio growth and an increase in net unrealized depreciation for the nine months ended June 30, 2013, as compared to the same period in the prior year. Based on 28,684,229 and 17,320,468 weighted average common shares outstanding for the nine months ended June 30, 2013 and 2012, respectively, our per share net increase in net assets resulting from operations was $0.85 for the nine months ended June 30, 2013, versus a per share net increase in net assets from operations of $0.87 for the nine months ended June 30, 2012.

Financial Condition, Liquidity and Capital Resources

As a RIC, we intend to distribute substantially all of our net income to our stockholders and thus expect to have an ongoing need to raise additional capital for investment purposes. To fund growth, we have a number of alternatives available to increase capital; including raising equity, increasing debt, and funding from operational cash flow.

Our liquidity and capital resources have been generated primarily from the net proceeds of public offerings of common stock, advances from the Revolving Facility and the Term Loan Facility (each as defined below and together, the “Facilities”) and net proceeds from the issuance of notes as well as cash flows from operations.

On January 20, 2011, we completed our IPO and issued 11,111,112 shares of common stock and received net proceeds of $129.6 million.

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On August 4, 2011, the Company closed a four-year senior secured revolving credit facility (the “Revolving Facility”) led by ING Capital LLC with initial commitments of $60 million and a feature that provides for expansion of the Revolving Facility to up to $125 million, subject to customary conditions.

On March 21, 2012, we issued $40.0 million in aggregate principal amount of 7.125% notes that mature on March 30, 2019 (the “2019 Notes”). The 2019 Notes may be redeemed in whole or in part at any time or from time to time at our option on or after March 30, 2015. The 2019 Notes bear interest at a rate of 7.125% per year, payable quarterly on March 30, June 30, September 30 and December 30 of each year, beginning June 30, 2012. The 2019 Notes are listed on the New York Stock Exchange and trade thereon under the trading symbol “MCQ”. As of June 30, 2013, $40.0 million in aggregate principal amount of the 2019 Notes were outstanding.

On August 24, 2012, we completed a public offering of 5,750,000 shares, including the underwriters’ full exercise of the option to purchase additional shares, of our common stock at a public offering price of $12.95 per share, raising approximately $71.9 million in net proceeds.

On August 31, 2012, we entered into Amendment No. 1 to the Revolving Facility, and entered into a new senior secured term loan credit facility (the “Term Loan Facility” and, together with the Revolving Facility, the “Facilities”) with ING Capital LLC.

Amendment No. 1 to the Revolving Facility revised the Revolving Facility to, among other things, increase the amount available for borrowing from $125.0 million to $132.5 million; permit the Term Loan Facility; and extend the maturity date from August 4, 2015 to August 31, 2016. Amendment No. 1 to the Revolving Facility also changed the interest rate of the Revolving Facility from (a) Eurocurrency loans from LIBOR + 3.75% per annum, with a 1% LIBOR floor, to (i) when the Company’s stockholders’ equity is less than or equal to $350.0 million and the step-down condition is not satisfied, LIBOR plus 3.75% per annum, with no LIBOR floor, and (ii) when the Company’s stockholders’ equity exceeds $350.0 million and the step-down condition is satisfied, LIBOR plus 3.25% per annum, with no LIBOR floor, and (b) alternative base rate loans, or ABR, based on 2.75% per annum plus the greatest of the Prime Rate in effect on such day, the federal funds effective rate for such day plus 0.5%, LIBOR for a period of three months plus 1% or the ABR Floor of 2% to (i) when the Company’s stockholders’ equity is less than or equal to $350.0 million and the step-down condition is not satisfied, 2.75% per annum plus the greatest of the Prime Rate in effect on such day, the federal funds effective rate for such day plus 0.5% or LIBOR for a period of three months plus 1%, and (ii) when the Company’s stockholders’ equity exceeds $350.0 million and the step-down condition is satisfied, 2.25% per annum plus the greatest of the Prime Rate in effect on such day, the federal funds effective rate for such day plus 0.5% or LIBOR for a period of three months plus 1%. As of June 30, 2013, there was $54.7 million outstanding under the Revolving Facility.

Each of the Facilities includes an accordion feature permitting us to expand the Facilities, if certain conditions are satisfied; provided, however, that the aggregate amount of the Facilities, collectively, is capped at $400.0 million.

On September 25, 2012, we closed $5 million of additional commitments to the Revolving Facility resulting in total commitments to the Revolving Facility of $137.5 million.

On December 3, 2012, we completed a public offering of 5,000,000 shares of our common stock at a public offering price of $13.75 per share, raising approximately $66.0 million in net proceeds. On December 19, 2012, we sold an additional 495,263 shares of our common stock at a public offering price of $13.75 per share, raising approximately $6.5 million in net proceeds, pursuant to the underwriters’ partial exercise of the option to purchase additional shares.

On December 7, 2012, we entered into Amendment No. 2 to the Revolving Facility, and entered into Amendment No. 1 to the Term Loan Facility.

Amendment No. 2 to the Revolving Facility revised the Revolving Facility, to, among other things, increase the amount available for borrowing from $137.5 million to $182.0 million.

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Amendment No. 1 to the Term Loan Facility revised the Term Loan Facility, to, among other things, increase the amount available for borrowing from $55.0 million to $80.5 million. The Term Loan Facility matures on August 31, 2017 and bears interest at LIBOR plus 4.00% (with no LIBOR floor, rounded upwards, if necessary, to the next 1/16 of 1%).

On January 23, 2013, we entered into Amendment No. 2 to the Term Loan Facility. Amendment No. 2 to the Term Loan Facility revised the Term Loan Facility, to, among other things, increase the amount available for borrowing from $80.5 million to $100.0 million.

On January 23, 2013, the Company closed $18.0 million of additional commitments to the Revolving Facility resulting in total commitments to the Revolving Facility of $200.0 million.

On March 18, 2013, the Company issued $60.0 million in aggregate principal amount of 6.125% notes that mature on March 30, 2023 (the “2023 Notes”). The 2023 Notes may be redeemed in whole or in part at any time or from time to time at the Company's option on or after March 30, 2016. The 2023 Notes bear interest at a rate of 6.125% per year, payable quarterly on March 30, June 30, September 30 and December 30 of each year, beginning June 30, 2013. The 2023 Notes are listed on the New York Stock Exchange and trade thereon under the trading symbol “MCV”.

On March 26, 2013, the Company closed an additional $3.5 million in aggregate principal amount of the 2023 Notes, pursuant to the partial exercise of the underwriters’ option to purchase additional notes.

On March 28, 2013, we entered into Amendment No. 3 to the Revolving Facility, and entered into Amendment No. 3 to the Term Loan Facility.

Amendment No. 3 to each of the Revolving Facility and the Term Loan Facility amend certain provisions of the Facilities. In particular, the aggregate accordion feature permitting subsequent increases to the Facilities have been increased to an aggregate maximum amount of $400 million, an increase of $100 million from the prior limit of $300 million.

On March 28, 2013, the Company closed $9.0 million of additional commitments to the Revolving Facility resulting in total commitments to the Revolving Facility of $209.0 million and $5.0 million of additional commitments to the Term Facility resulting in total commitments to the Term Facility of $105.0 million.

On April 12, 2013, we completed a public offering of 4,000,000 shares of our common stock and an additional 492,271 shares of our common stock pursuant to the underwriters’ partial exercise of the over-allotment option at a public offering price of $14.70 per share, raising approximately $63.4 million in net proceeds.

On April 18, 2013, the Company closed $1.0 million of additional commitments to the Revolving Facility resulting in total commitments to the Revolving Facility of $210.0 million.

On May 1, 2013, we entered into Amendment No. 4 to the Revolving Facility, and entered into Amendment No. 4 to the Term Loan Facility.

Amendment No. 4 to the Revolving Facility revised the Revolving Facility, to, among other things, increase the amount available for borrowing from $210.0 million to $230.0 million.

Amendment No. 4 to the Term Loan Facility revised the Term Loan Facility, to, among other things, increase the amount available for borrowing from $105.0 million to $115.0 million.

As of June 30, 2013, we had $13.5 million in cash and cash equivalents. In the future, we may generate cash from future offerings of securities, future borrowings and cash flows from operations, including interest earned from the temporary investment of cash in U.S. government securities and other high-quality debt investments that mature in one year or less. Our primary use of funds is investments in our targeted asset classes, cash distributions to our stockholders, and other general corporate purposes.

If our common stock trades below our net asset value per share, we will generally not be able to issue additional common stock at the market price unless our stockholders approve such a sale and our Board of Directors makes certain determinations. A proposal, approved by our stockholders at our reconvened 2013

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Annual Meeting of Stockholders, authorizes us to sell shares of our common stock below the then current net asset value per share of our common stock in one or more offerings (subject to certain conditions, including that the number of shares issued in such offerings does not exceed 25% of our then outstanding common stock, at a price below, but no more than 20% below, our then current net asset value) for a period expiring on the earlier of the anniversary of the date of the 2013 Annual Meeting or the date of our 2014 Annual Meeting of Stockholders.

In order to satisfy the Code requirements applicable to a RIC, we intend to distribute to our stockholders substantially all of our taxable income, but we may also elect to periodically spillover certain excess undistributed taxable income from one tax year into the next tax year. In addition, as a BDC, we generally are required to meet a coverage ratio of total assets to total senior securities, which include borrowings and any preferred stock we may issue in the future, of at least 200%. This requirement limits the amount that we may borrow.

On March 26, 2013, our wholly-owned subsidiary, Medley SBIC LP (“SBIC LP”), received a Small Business Investment Company (“SBIC”) license from the Small Business Administration (“SBA”).

The SBIC license allows SBIC LP to obtain leverage by issuing SBA-guaranteed debentures, subject to the issuance of a capital commitment by the SBA and other customary procedures. SBA-guaranteed debentures are non-recourse, interest only debentures with interest payable semi-annually and have a ten year maturity. The principal amount of SBA-guaranteed debentures is not required to be paid prior to maturity but may be prepaid at any time without penalty. The interest rate of SBA-guaranteed debentures is fixed on a semi-annual basis at a market-driven spread over U.S. Treasury Notes with 10-year maturities. The SBA, as a creditor, will have a superior claim to SBIC LP’s assets over our stockholders in the event we liquidate SBIC LP or the SBA exercises its remedies under the SBA-guaranteed debentures issued by SBIC LP upon an event of default.

SBA regulations currently limit the amount that SBIC LP may borrow to a maximum of $150 million when it has at least $75 million in regulatory capital, receives a capital commitment from the SBA and has been through an examination by the SBA subsequent to licensing.

On November 16, 2012, we obtained exemptive relief from the SEC to permit us to exclude the debt of SBIC LP guaranteed by the SBA from our 200% asset coverage test under the 1940 Act. The exemptive relief provides us with increased flexibility under the 200% asset coverage test by permitting SBIC LP to borrow up to $150 million more than it would otherwise be able to absent the receipt of this exemptive relief.

As of June 30, 2013, SBIC LP had $50.0 million in regulatory capital and had $5.0 million SBA-guaranteed debentures outstanding.

Contractual Obligations and Off-Balance Sheet Arrangements

We may become a party to financial instruments with off-balance sheet risk in the normal course of our business to meet the financial needs of our portfolio companies. These instruments may include commitments to extend credit and involve, to varying degrees, elements of liquidity and credit risk in excess of the amount recognized on our balance sheet. As of June 30, 2013, we had commitments under loan and financing agreements to fund up to $21.9 million to four portfolio companies. These commitments are primarily composed of senior secured term loans and preferred equity. The commitments are generally subject to the borrowers meeting certain criteria such as compliance with covenants and certain operational metrics. The terms of the borrowings and financings subject to commitment are comparable to the terms of other loan and equity securities in our portfolio.

We have certain contracts under which we have material future commitments. We have entered into an investment management agreement with MCC Advisors in accordance with the 1940 Act. The investment management agreement became effective upon the pricing of our initial public offering. Under the investment management agreement, MCC Advisors has agreed to provide us with investment advisory and management services. For these services, we have agreed to pay a base management fee equal to a percentage of our gross assets and an incentive fee based on our performance.

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We have also entered into an administration agreement with MCC Advisors as our administrator. The administration agreement became effective upon the pricing of our initial public offering. Under the administration agreement, MCC Advisors has agreed to furnish us with office facilities and equipment, provide us clerical, bookkeeping and record keeping services at such facilities and provide us with other administrative services necessary to conduct our day-to-day operations. MCC Advisors will also provide on our behalf significant managerial assistance to those portfolio companies to which we are required to provide such assistance.

The following table shows our payment obligations for repayment of debt and other contractual obligations at June 30, 2013 (dollars in thousands):

		Payment Due by Period
		Total				Less than 1 year				1 – 3 years				3 – 5 years				More than 5 years
Revolving Facility		$	54,700			$	—			$	—			$	54,700			$	—
Term Loan Facility			115,000				—				—				115,000				—
7.125% Notes			40,000				—				—				—				40,000
6.125% Notes			63,500				—				—				—				63,500
SBA Debenture			5,000				—				—				—				5,000
Total contractual obligations		$	278,200			$	—			$	—			$	169,700			$	108,500

If any of the contractual obligations discussed above are terminated, our costs under any new agreements that we enter into may increase. In addition, we would likely incur significant time and expense in locating alternative parties to provide the services we expect to receive under our investment management agreement and our administration agreement. Any new investment management agreement would also be subject to approval by our stockholders.

Distributions

We have elected and qualified to be treated for U.S. federal income tax purposes as a RIC under subchapter M of the Code. As a RIC, in any taxable year with respect to which we timely distribute to our stockholders at least 90% of the sum of our (i) investment company taxable income (which is generally our net ordinary income plus the excess of realized net short-term capital gains over realized net long-term capital losses, if any) determined without regard to the deduction for dividends paid, we (but not our stockholders) generally will not be subject to U.S. federal income tax on investment company taxable income and net capital gains that we distribute to our stockholders. We intend to distribute annually all or substantially all of such income. To the extent that we retain our net capital gains or any investment company taxable income, we will be subject to U.S. federal income tax. We may choose to retain our net capital gains or any investment company taxable income, and pay the associated U.S. federal income tax, including the U.S. federal excise tax described below.

Amounts not distributed on a timely basis in accordance with a calendar year distribution requirement are subject to a nondeductible 4% U.S. federal excise tax payable by us. To avoid this tax, we must distribute (or be deemed to have distributed) during each calendar year an amount equal to the sum of:

While we intend to distribute any income and capital gains in the manner necessary to minimize imposition of the 4% U.S. federal excise tax, sufficient amounts of our taxable income and capital gains may not be distributed to avoid entirely the imposition of the tax. In that event, we will be liable for the tax only on the amount by which we do not meet the foregoing distribution requirement.

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We intend to pay quarterly dividends to our stockholders out of assets legally available for distribution. We cannot assure you that we will achieve investment results that will allow us to pay a specified level of dividends or year-to-year increases in dividends. In addition, the inability to satisfy the asset coverage test applicable to us as a BDC could limit our ability to pay dividends. All dividends will be paid at the discretion of our board of directors and will depend on our earnings, our financial condition, maintenance of our RIC status, compliance with applicable BDC regulations and such other factors as our board of directors may deem relevant from time to time. We cannot assure you that we will pay dividends to our stockholders in the future.

To the extent our taxable earnings fall below the total amount of our distributions for a taxable year, a portion of those distributions may be deemed a return of capital to our stockholders for U.S. federal income tax purposes. Thus, the source of a distribution to our stockholders may be the original capital invested or dividends reinvested by a particular stockholder rather than our income or gains. Stockholders should read any written disclosure accompanying a distribution carefully and should not assume that the source of any distribution is our ordinary income or gains.

We have adopted an “opt out” dividend reinvestment plan for our common stockholders. As a result, if we declare a cash dividend or other distribution, each stockholder that has not “opted out”of our dividend reinvestment plan will have their dividends automatically reinvested in additional shares of our common stock rather than receiving cash dividends. Stockholders who receive distributions in the form of shares of common stock will be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions.

On May 11, 2011, the Company’s board of directors declared a quarterly dividend of $0.16 per share payable on June 15, 2011 to stockholders of record at the close of business on June 1, 2011.

On August 4, 2011, the Company’s board of directors declared a quarterly dividend of $0.21 per share payable on September 15, 2011 to stockholders of record at the close of business on September 1, 2011.

On November 29, 2011, the Company’s board of directors declared a quarterly dividend of $0.25 per share payable on December 30, 2011 to stockholders of record at the close of business on December 15, 2011.

On February 2, 2012, the Company’s board of directors declared a quarterly dividend of $0.28 per share payable on March 15, 2012 to stockholders of record at the close of business on February 24, 2012.

On May 2, 2012, the Company’s board of directors declared a quarterly dividend of $0.31 per share payable on June 15, 2012, to stockholders of record at the close of business on May 25, 2012.

On August 1, 2012, the Company’s board of directors declared a quarterly dividend of $0.36 per share payable on September 14, 2012, to stockholders of record at the close of business on August 24, 2012.

On November 1, 2012, the Company’s board of directors declared a quarterly dividend of $0.36 per share payable on December 14, 2012, to stockholders of record at the close of business on November 23, 2012.

On January 31, 2013, the Company’s board of directors declared a quarterly dividend of $0.36 per share payable on March 15, 2013, to stockholders of record at the close of business on February 27, 2013.

On May 1, 2013, the Company’s board of directors declared a quarterly dividend of $0.36 per share payable on June 14, 2013 to stockholders of record at the close of business on May 24, 2013.

Related Party Transactions

Concurrent with the pricing of our initial public offering, we entered into a number of business relationships with affiliated or related parties, including the following:

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MCC Advisors and its affiliates may in the future manage other accounts that have investment mandates that are similar, in whole and in part, with ours. MCC Advisors and its affiliates may determine that an investment is appropriate for us and for one or more of those other accounts. In such event, depending on the availability of such investment and other appropriate factors, and pursuant to MCC Advisors’ allocation policy, MCC Advisors or its affiliates may determine that we should invest side-by-side with one or more other accounts. We will not make any investments if they are not permitted by applicable law and interpretive positions of the SEC and its staff, or if they are inconsistent with MCC Advisors’ allocation procedures.

In addition, we have adopted a formal code of ethics that governs the conduct of our and MCC Advisors’ officers, directors and employees. Our officers and directors also remain subject to the duties imposed by both the 1940 Act and the Delaware General Corporation Law.

Management Fee

Pursuant to the investment management agreement, we pay our investment adviser a fee for investment management services consisting of two components — a base management fee and an incentive fee.

MCC Advisors receives a base management fee from us payable quarterly in arrears, at an annual rate of 1.75% of our gross assets, including any assets acquired with the proceeds of leverage. MCC Advisors agreed to waive the base management fee payable with respect to cash and cash equivalents held by the Company through December 31, 2011.

The investment management agreement also provides that MCC Advisors is entitled to an incentive fee of 20.0%. The incentive fee consists of two parts: (1) the first component, which is payable quarterly in arrears, equals 20.0% of the excess, if any, of the pre-incentive fee net investment income over a hurdle rate (2.0% quarterly) and subject to a “catch-up” provision measured as of the end of each calendar quarter. Under this provision, in any calendar quarter, MCC Advisors receives no incentive fee until our net investment income equals the hurdle rate of 2.0%, but then receives, as a “catch-up”, 100% of our pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the hurdle rate but is less than 2.5%. The effect of this provision is that, if pre-incentive fee net investment income exceeds 2.5% in any calendar quarter, MCC Advisors will receive 20% of our pre-incentive fee net investment income as if the hurdle rate did not apply; and (2) the second component, which is payable in arrears at the end of each calendar year (or upon termination of the investment management agreement, as of the termination date), commencing with the year ending December 31, 2011, equals 20.0% of our cumulative aggregate realized capital gains less cumulative realized capital losses, unrealized capital depreciation (unrealized depreciation on a gross investment-by-investment basis at the end of each calendar year) and all capital gains upon which prior performance-based capital gains incentive fee payments were previously made to MCC Advisers.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following items as critical accounting policies.

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Valuation of Portfolio Investments

We value investments for which market quotations are readily available at their market quotations, which are generally obtained from an independent pricing service or multiple broker-dealers or market makers. We weight the use of third-party broker quotes, if any, in determining fair value based on our understanding of the level of actual transactions used by the broker to develop the quote and whether the quote was an indicative price or binding offer. However, a readily available market value is not expected to exist for many of the investments in our portfolio, and we value these portfolio investments at fair value as determined in good faith by our board of directors under our valuation policy and process. We may seek pricing information with respect to certain of our investments from pricing services or brokers or dealers in order to value such investments. We also employ independent third party valuation firms for all of our investments for which there is not a readily available market value.

Valuation methods may include comparisons of financial ratios of the portfolio companies that issued such private equity securities to peer companies that are public, the nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings and discounted cash flows, the markets in which the portfolio company does business, and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we will consider the pricing indicated by the external event to corroborate the private equity valuation. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the investments may differ significantly from the values that would have been used had a readily available market value existed for such investments, and the differences could be material.

Our board of directors is ultimately and solely responsible for determining the fair value of the investments in our portfolio that are not publicly traded, whose market prices are not readily available on a quarterly basis or any other situation where portfolio investments require a fair value determination.

With respect to investments for which market quotations are not readily available, our board of directors will undertake a multi-step valuation process each quarter, as described below:

In following these approaches, the types of factors that are taken into account in fair value pricing investments include available current market data, including relevant and applicable market trading and transaction comparables; applicable market yields and multiples; security covenants; call protection provisions; information rights; the nature and realizable value of any collateral; the portfolio company’s ability to make payments; the portfolio company’s earnings and discounted cash flows; the markets in which the portfolio company does business; comparisons of financial ratios of peer companies that are public; comparable merger and acquisition transactions; and the principal market and enterprise values.

Determination of fair values involves subjective judgments and estimates not verifiable by auditing procedures. Under current auditing standards, the notes to our financial statements refer to the uncertainty with respect to the possible effect of such valuations, and any change in such valuations, on our consolidated financial statements.

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Revenue Recognition

Our revenue recognition policies are as follows:

Investments and Related Investment Income.  We account for investment transactions on a trade-date basis and interest income, adjusted for amortization of premiums and accretion of discounts, is recorded on an accrual basis. For investments with contractual PIK interest, which represents contractual interest accrued and added to the principal balance that generally becomes due at maturity, we will not accrue PIK interest if the portfolio company valuation indicates that the PIK interest is not collectible. Origination, closing and/or commitment fees associated with investments in portfolio companies are recognized as income when the investment transaction closes. Other fees are capitalized as deferred revenue and recorded into income over the respective period. Prepayment penalties received by the Company for debt instruments paid back to the Company prior to the maturity date are recorded as income upon receipt. Realized gains or losses on investments are measured by the difference between the net proceeds from the disposition and the amortized cost basis of investment, without regard to unrealized gains or losses previously recognized. We report changes in the fair value of investments that are measured at fair value as a component of the net change in unrealized appreciation (depreciation) on investments in our consolidated statement of operations.

Non-accrual.  We place loans on non-accrual status when principal and interest payments are past due by 90 days or more, or when there is reasonable doubt that we will collect principal or interest. Accrued interest is generally reversed when a loan is placed on non-accrual. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment. Non-accrual loans are restored to accrual status when past due principal and interest is paid and, in our management’s judgment, are likely to remain current. At June 30, 2013, one portfolio company was on PIK non-accrual status with a fair value of approximately $4.1 million, or 0.6% of the fair value of our portfolio. At September 30, 2012, we had no portfolio company on non-accrual status.

Federal Income Taxes

The Company has elected and qualified to be treated for U.S. federal income tax purposes as a RIC under subchapter M of the Code, commencing with its first taxable year as a corporation, and it intends to operate in a manner so as to maintain its RIC tax treatment. To maintain its RIC status, among other things, the Company is required to meet certain source of income and asset diversification requirements and must timely distribute to its stockholders at least 90% of the sum of investment company taxable income (“ICTI”) including PIK, as defined by the Code, and net tax exempt interest income (which is the excess of our gross tax exempt interest income over certain disallowed deductions) for each taxable year. The Company will be subject to a nondeductible U.S. federal excise tax of 4% on undistributed income if it does not distribute at least 98% of its net ordinary income for any calendar year, 98.2% of its capital gain net income for each one-year period ending on October 31 of such calendar year and any income realized, but not distributed in preceding years. Depending on the level of ICTI earned in a tax year, the Company may choose to carry forward ICTI in excess of current year dividend distributions into the next tax year and pay a 4% excise tax on such income, as required. To the extent that the Company determines that its estimated current year annual taxable income will be in excess of estimated current year dividend distributions for excise tax purposes, the Company accrues excise tax, if any, on estimated excess taxable income as taxable income is earned. Any such carryover ICTI must be distributed before the end of that next tax year through a dividend declared prior to filing the final tax return related to the year which generated such ICTI.

Because federal income tax regulations differ from GAAP, distributions in accordance with tax regulations may differ from net investment income and realized gains recognized for financial reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified among capital accounts in the consolidated financial statements to reflect their tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future. Differences in classification may also result from the treatment of short-term gains as ordinary income for tax purposes.

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UNDERWRITING

The Company and the underwriters named below have entered into an underwriting agreement with respect to the shares being offered. Goldman, Sachs & Co., Barclays Capital Inc., Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC are the representatives of the underwriters.

Underwriters		Number of Shares
Goldman, Sachs & Co.
Barclays Capital Inc.
Credit Suisse Securities (USA) LLC
J.P. Morgan Securities LLC
Total			6,000,000

The underwriters are committed to take and pay for all of the shares being offered, if any are taken, other than the shares being sold directly by us and those covered by the option described below unless and until this option is exercised.

If the underwriters sell more shares than the total number set forth in the table above, we have granted the underwriters an option to buy up to an additional 900,000 shares from us. They may exercise that option for 30 days. If any shares are purchased pursuant to this option, the underwriters will severally purchase shares in approximately the same proportion as set forth in the table above.

The following table shows the total underwriting discounts and commissions that we are to pay to the underwriters in connection with this offering. Such amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase additional shares.

		No Exercise				Full Exercise
Per Share		$				$
Total		$				$

We estimate that the total expenses of this offering payable by us (including up to $10,000 in reimbursement of underwriters’ counsel fees), exclusive of the underwriting discount or commission, will be approximately $200,000.

Shares sold by the underwriters to the public will initially be offered at the public offering price set forth on the cover of this prospectus supplement. Any shares sold by the underwriters to securities dealers may be sold at a discount of up to $     per share from the public offering price. If all the shares are not sold at the public offering price, the underwriters may change the offering price and the other selling terms. The offering of the shares by the underwriters are subject to receipt and acceptance and subject to the underwriters’ right to reject any order in whole or in part.

The Company and the directors and executive officers of the Company have agreed with the underwriters, subject to certain exceptions, not to offer, sell, contract to sell, pledge, grant any option to purchase, make any short sale or otherwise dispose of or hedge any shares of common stock, during the period of 30 days from the date of this prospectus supplement, except with the prior written consent of the underwriters.

The 30-day restricted period described in the preceding paragraph will be automatically extended if:
(1) during the last 17 days of the 30-day restricted period we issue an earnings release or announce material news or a material event; or (2) prior to the expiration of the 30-day restricted period, we announce that we will release earnings results during the 15-day period following the last day of the 30-day restricted period, in which case the restrictions described in the preceding paragraph will continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release of the announcement of the material news or material event.

In connection with the offering, the underwriters may purchase and sell shares of common stock in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriters of a greater number of shares than it is required to purchase in the offering. “Covered” short sales are sales made in an amount not greater

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than the underwriters’ option to purchase additional shares from the Company in the offering. The underwriters may close out any covered short position by either exercising its option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to close out the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which it may purchase additional shares pursuant to the option granted to it. “Naked” short sales are any sales in excess of such option. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing transactions consist of various bids for or purchases of common stock made by the underwriters in the open market prior to the completion of the offering.

The underwriters may also impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased shares sold by or for the account of such underwriter in stabilizing or short covering transactions.

Purchases to cover a short position and stabilizing transactions, as well as other purchases by the underwriters for their own account, may have the effect of preventing or retarding a decline in the market price of the Company’s stock, and may stabilize, maintain or otherwise affect the market price of the common stock. As a result, the price of the common stock may be higher than the price that otherwise might exist in the open market. If these activities are commenced, they may be discontinued at any time. These transactions may be effected on the New York Stock Exchange, in the over-the-counter market or otherwise.

European Economic Area

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State), each underwriter has represented and agreed that with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the Relevant Implementation Date) it has not made and will not make an offer of shares to the public in that Relevant Member State prior to the publication of a prospectus in relation to the shares which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that it may, with effect from and including the Relevant Implementation Date, make an offer of shares to the public in that Relevant Member State at any time:

For the purposes of this provision, the expression an “offer of shares to the public” in relation to any shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the shares to be offered so as to enable an investor to decide to purchase or subscribe the shares, as the same may be varied in that Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State and the expression Prospectus Directive means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State.

Each underwriter has represented and agreed that:

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Hong Kong

The shares may not be offered or sold by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), or (ii) to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap.571, Laws of Hong Kong) and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a “prospectus” within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), and no advertisement, invitation or document relating to the shares may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder.

Switzerland

This prospectus does not constitute an issue prospectus pursuant to Article 652a or Article 1156 of the Swiss Code of Obligations (“CO”) and the shares will not be listed on the SIX Swiss Exchange. Therefore, this prospectus may not comply with the disclosure standards of the CO and/or the listing rules (including any prospectus schemes) of the SIX Swiss Exchange. Accordingly, the shares may not be offered to the public in or from Switzerland, but only to a selected and limited circle of investors, which do not subscribe to the shares with a view to distribution.

Singapore

This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the “SFA”), (ii) to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

Where the shares are subscribed or purchased under Section 275 by a relevant person which is: (a) a corporation (which is not an accredited investor) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or (b) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary is an accredited investor, shares, debentures and units of shares and debentures of that corporation or the beneficiaries’ rights and interest in that trust shall not be transferable for six months after that corporation or that trust has acquired the shares under Section 275 except: (1) to an institutional investor under Section 274 of the SFA or to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA; (2) where no consideration is given for the transfer; or (3) by operation of law.

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Japan

The securities have not been and will not be registered under the Financial Instruments and Exchange Law of Japan (the Financial Instruments and Exchange Law) and each underwriter has agreed that it will not offer or sell any securities, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Law and any other applicable laws, regulations and ministerial guidelines of Japan.

Other

The Company has agreed to indemnify the several underwriters against certain liabilities, including liabilities under the Securities Act.

The underwriters and their affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage activities. Certain of the underwriters and their respective affiliates have in the past and may in the future perform various financial advisory and investment banking services for us, for which they received or will receive customary fees and expenses.

In the ordinary course of their various business activities, the underwriters and their affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers and such investment and securities activities may involve securities and/or instruments of the issuer. The underwriters and their affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or instruments and may at any time hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.

Certain of the underwriters and/or their affiliates are lenders under the Company's Revolving Facility and may receive a portion of the net proceeds from this offering. For example, affiliates of Goldman, Sachs & Co., Barclays Capital Inc. and Credit Suisse Securities (USA) LLC are lenders under the Revolving Facility.

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VALIDITY OF COMMON STOCK

The validity of the shares of common stock offered hereby will be passed upon for Medley Capital Corporation by Sutherland, Asbill & Brennan LLP, Washington, DC. The validity of the shares of common stock offered hereby will be passed upon for the underwriters by Fried, Frank, Harris, Shriver & Jacobson LLP, New York, New York.

EXPERTS

Ernst & Young LLP, our independent registered public accounting firm, has audited our consolidated financial statements for the years ended September 30, 2012 and 2011, and for the period from April 23, 2010 (inception date) to September 30, 2010, as set forth in their report. We have included our financial statements in the accompanying prospectus and elsewhere in the registration statement in reliance on such report, given on their authority as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We have filed a registration statement with the SEC on Form N-2, including amendments, relating to the shares we are offering by this prospectus supplement. This prospectus supplement does not contain all of the information set forth in the registration statement, including any exhibits and schedules it may contain. For further information concerning us or the common stock we are offering, please refer to the registration statement.

We are required to file with or submit to the SEC annual, quarterly and current periodic reports, proxy statements and other information meeting the informational requirements of the Exchange Act. You may inspect and copy these reports, proxy statements and other information, as well as the registration statement and related exhibits and schedules, at the Public Reference Room of the SEC at 100 F Street, NE, Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements and other information filed electronically by us with the SEC which are available on the SEC’s website at http://www.sec.gov. Copies of these reports, proxy and information statements and other information may be obtained, after paying a duplicating fee, by electronic request at the following e-mail address: publicinfo@sec.gov, or by writing to the SEC’s Public Reference Section, Washington, D.C. 20549. This information will also be available free of charge by contacting us by mail at 375 Park Avenue, 33rd Floor, New York, NY 10152, by telephone at (212) 759-0777 or on our website at http://www.medleycapitalcorp.com.

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INDEX TO FINANCIAL STATEMENTS

UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

		Page
Consolidated Statements of Assets and Liabilities as of June 30, 2013 (unaudited) and September 30, 2012			S-34
Consolidated Statements of Operations for the three and nine months ended June 30, 2013 and 2012 (unaudited)			S-35
Consolidated Statements of Changes in Net Assets for the nine months ended June 30, 2013 and 2012 (unaudited)			S-36
Consolidated Statements of Cash Flows for the nine months ended June 30, 2013 and 2012 (unaudited)			S-37
Consolidated Schedules of Investments as of June 30, 2013 (unaudited) and September 30, 2012			S-38
Notes to Consolidated Financial Statements (unaudited)			S-47

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Medley Capital Corporation
  
Consolidated Statements of Assets and Liabilities

		As of
		June 30, 2013				September 30, 2012
		(unaudited)
ASSETS
Investments at fair value
Non-controlled/non-affiliated investments (amortized cost of $686,448,197 and $394,482,053, respectively)		$	677,350,840			$	393,741,357
Affiliated investments (amortized cost of $9,126,612 and $8,678,596, respectively)			9,024,065				8,208,006
Total investments at fair value			686,374,905				401,949,363
Cash and cash equivalents			13,458,925				4,893,616
Interest receivable			9,941,064				3,940,148
Deferred financing costs, net			8,295,305				4,651,724
Fees receivable			1,625,000				—
Other assets			345,460				232,496
Receivable for investments sold			4,568,652				—
Deferred offering costs			241,510				103,671
Total assets		$	724,850,821			$	415,771,018
LIABILITIES
Revolving credit facility payable		$	54,700,000			$	15,000,000
Term loan payable			115,000,000				55,000,000
Notes payable			103,500,000				40,000,000
SBA debentures			5,000,000				—
Payable for investments purchased			15,000,000				10,212,300
Management and incentive fees payable, net			5,984,655				3,514,772
Accounts payable and accrued expenses			1,635,812				924,152
Administrator expenses payable			681,924				465,412
Deferred revenue			181,315				173,627
Interest and fees payable			2,813,939				1,048,205
Due to affiliate			24,028				13,246
Offering costs payable			83,054				80,073
Total liabilities		$	304,604,727			$	126,431,787
NET ASSETS
Common stock, par value $.001 per share, 100,000,000 common shares authorized, 33,226,126 and 23,110,242 common shares issued and outstanding, respectively		$	33,226			$	23,110
Capital in excess of par value			422,205,081				285,012,499
Accumulated undistributed net investment income			7,014,978				5,559,635
Accumulated net realized gain (loss) from investments			192,713				(44,727	)
Net unrealized appreciation (depreciation) on investments			(9,199,904	)			(1,211,286	)
Total net assets			420,246,094				289,339,231
Total liabilities and net assets		$	724,850,821			$	415,771,018
NET ASSET VALUE PER SHARE		$	12.65			$	12.52

 
 
See accompanying notes to consolidated financial statements.

TABLE OF CONTENTS

Medley Capital Corporation
  
Consolidated Statements of Operations

		For the three months ended June 30								For the nine months ended June 30
		2013				2012				2013				2012
		(unaudited)				(unaudited)				(unaudited)				(unaudited)
INVESTMENT INCOME
Interest from investments
Non-controlled/Non-affiliated investments		$	19,572,407			$	10,179,522			$	50,383,033			$	23,962,160
Affiliated investments			376,790				239,761				1,112,503				2,013,461
Total interest income			19,949,197				10,419,283				51,495,536				25,975,621
Interest from cash and cash equivalents			2,677				781				6,192				3,513
Other fee income (See note 9)			3,639,234				1,832,307				10,016,301				4,475,777
Total investment income			23,591,108				12,252,371				61,518,029				30,454,911
EXPENSES
Base management fees			2,977,097				1,498,212				7,606,894				3,782,158
Incentive fees			3,007,559				1,552,011				8,010,952				4,110,844
Interest and financing expenses			4,032,337				1,781,455				9,283,079				2,890,872
Administrator expenses			681,924				395,689				1,773,348				1,074,173
Professional fees			319,982				469,650				1,160,684				1,102,278
Directors fees			71,125				131,125				314,786				377,504
Insurance			69,758				121,506				210,517				343,325
General and administrative			398,785				94,678				963,046				371,505
Organizational expense			2,305				—				150,916				—
Expenses before management fee waiver			11,560,872				6,044,326				29,474,222				14,052,659
Management fee waiver			—				—				—				(41,126	)
Total expenses net of management fee waiver			11,560,872				6,044,326				29,474,222				14,011,533
Net investment income before excise taxes			12,030,236				6,208,045				32,043,807				16,443,378
Excise tax expense			—				—				—				(35,501	)
NET INVESTMENT INCOME			12,030,236				6,208,045				32,043,807				16,407,877
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain/(loss) from investments			(136,914	)			(15,016	)			237,440				93,552
Net unrealized appreciation/(depreciation) on investments			(8,736,445	)			(1,353,281	)			(7,988,618	)			(1,434,400	)
Net gain/(loss) on investments			(8,873,359	)			(1,368,297	)			(7,751,178	)			(1,340,848	)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS		$	3,156,877			$	4,839,748			$	24,292,629			$	15,067,029
WEIGHTED AVERAGE – BASIC AND DILUTED EARNINGS PER COMMON SHARE		$	0.10			$	0.28			$	0.85			$	0.87
WEIGHTED AVERAGE – BASIC AND DILUTED NET INVESTMENT INCOME PER COMMON SHARE		$	0.37			$	0.36			$	1.12			$	0.95
WEIGHTED AVERAGE COMMON STOCK OUTSTANDING – BASIC AND DILUTED (SEE NOTE 11)			32,658,336				17,320,468				28,684,229				17,320,468
DIVIDENDS DECLARED PER COMMON SHARE		$	0.36			$	0.31			$	1.08			$	0.84

 
 
See accompanying notes to consolidated financial statements.

TABLE OF CONTENTS

Medley Capital Corporation
  
Consolidated Statements of Changes in Net Assets

		For the nine months ended June 30, 2013				For the nine months ended June 30, 2012
		(unaudited)				(unaudited)
INCREASE FROM OPERATIONS:
Net investment income		$	32,043,807			$	16,407,877
Net realized gain/(loss) from investments			237,440				93,552
Net unrealized appreciation/(depreciation) on investments			(7,988,618	)			(1,434,400	)
Net increase/(decrease) in net assets from operations			24,292,629				15,067,029
SHAREHOLDER DISTRIBUTIONS:
Distributions declared from income ($1.08 and $0.84 per share, respectively)			(30,588,465	)			(14,549,193	)
Net decrease in net assets from shareholder distributions			(30,588,465	)			(14,549,193	)
CAPITAL SHARE TRANSACTIONS:
Issuance of common stock, net of underwriting costs			137,696,574				—
Offering costs			(493,875	)			—
Net increase in net assets from common share transactions			137,202,699				—
Total increase/(decrease) in net assets			130,906,863				517,836
Net assets at beginning of period			289,339,231				217,652,696
Net assets at end of period including accumulated undistributed net investment income of $7,014,978 and $5,078,773, respectively		$	420,246,094			$	218,170,532
Net asset value per common share		$	12.65			$	12.60
Common shares outstanding at end of period			33,226,126				17,320,468

 
 
See accompanying notes to consolidated financial statements.

TABLE OF CONTENTS

Medley Capital Corporation
  
Consolidated Statements of Cash Flows

		For the nine months ended June 30, 2013				For the nine months ended June 30, 2012
		(unaudited)				(unaudited)
Cash flows from operating activities
NET INCREASE IN NET ASSETS FROM OPERATIONS		$	24,292,629			$	15,067,029
ADJUSTMENTS TO RECONCILE NET INCREASE IN NET ASSETS FROM OPERATIONS TO NET CASH USED BY OPERATING ACTIVITIES:
Paid-in-kind interest income			(6,522,188	)			(2,545,968	)
Net amortization of premium (discount) on investments			(565,649	)			(23,574	)
Amortization of deferred financing costs			1,029,597				432,836
Net realized (gain) loss from investments			(237,440	)			(93,552	)
Net unrealized (appreciation) depreciation on investments			7,988,618				1,434,400
Proceeds from sale and redemption of investments			140,693,504				26,637,386
Purchase of investments			(425,782,387	)			(189,295,850	)
(Increase) decrease in operating assets:
Interest receivable			(6,000,916	)			(1,597,551	)
Fees receivable			(1,625,000	)			—
Other assets			(112,964	)			621,928
Receivable for investments sold			(4,568,652	)			—
Increase (decrease) in operating liabilities:
Payable for investments purchased			4,787,700				—
Accounts payable and accrued expenses			711,660				362,159
Management and incentive fees payable, net			2,469,883				1,566,472
Administrator expenses payable			216,512				49,396
Interest and fees payable			1,765,734				1,209,482
Deferred revenue			7,688				79,780
Due to affiliate			10,782				81,391
NET CASH USED BY OPERATING ACTIVITIES			(261,440,889	)			(146,014,236	)
Cash flows from financing activities
Proceeds from issuance of common stock, net of underwriting costs			137,696,574				—
Offering cost paid			(628,734	)			(82,666	)
Borrowings on debt			335,300,000				159,400,000
Paydowns on debt			(167,100,000	)			(10,700,000	)
Financing cost paid			(4,673,177	)			(2,135,443	)
Payments of cash dividends			(30,588,465	)			(14,549,193	)
NET CASH PROVIDED BY FINANCING ACTIVITIES			270,006,198				131,932,698
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS			8,565,309				(14,081,538	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD			4,893,616				17,201,643
CASH AND CASH EQUIVALENTS, END OF PERIOD		$	13,458,925			$	3,120,105
Supplemental Information:
Interest paid during the period		$	6,437,602			$	1,248,554
Excise tax paid during the period		$	—			$	35,501
Supplemental non-cash information
Paid-in-kind interest income		$	6,522,188			$	2,545,968
Net amortization of premium (discount) on investments		$	565,649			$	23,574
Amortization of deferred financing costs		$	(1,029,597	)		$	(432,836	)
Issuance of common stock in connection with dividend reinvestment plan		$	1,764,174			$	—

 
 
See accompanying notes to consolidated financial statements.

TABLE OF CONTENTS

Medley Capital Corporation

Consolidated Schedule of Investments

June 30, 2013
(unaudited)

Company(1)		Industry				Type of Investment				Maturity				Par Amount(2)				Cost				Fair Value				% of Net Assets(3)
Non-Controlled/ Non-Affiliated Investments:
Accupac, Inc.			Containers, Packaging and Glass				Senior Secured Second Lien Term Loan (12.29	%)			11/10/2018			$	12,000,000			$	12,000,000			$	12,000,000				2.9	%
															12,000,000				12,000,000				12,000,000
Aderant North America, Inc.			Electronics				Senior Secured Second Lien Term Loan (LIBOR + 8.75%, 1.25% LIBOR Floor)				6/20/2019				4,550,000				4,550,000				4,550,000				1.1	%
															4,550,000				4,550,000				4,550,000
American Apparel, Inc.(8)			Retail Stores				Senior Secured Note (13.00	%)			4/15/2020				13,000,000				12,618,046				13,064,500				3.1	%
															13,000,000				12,618,046				13,064,500
American Gaming Systems LLC			Hotels, Motels, Inns and Gaming				Senior Secured First Lien Term Loan (LIBOR + 10.00%, 1.50% LIBOR Floor)				8/15/2016				10,750,000				10,750,000				10,793,294				2.6	%
															10,750,000				10,750,000				10,793,294
ARBOC Specialty Vehicles LLC			Automobile				Senior Secured First Lien Term Loan (LIBOR + 12.50% Cash, 1.00% LIBOR Floor)				3/21/2018				25,000,000				25,000,000				25,000,000				5.9	%
															25,000,000				25,000,000				25,000,000
Aurora Flight Sciences Corporation			Aerospace & Defense				Senior Secured Second Lien Term Loan (11.25% Cash, 2.00% PIK)				3/16/2014				15,727,315				15,727,315				15,839,603				3.8	%
															15,727,315				15,727,315				15,839,603
BayDelta Maritime LLC			Cargo Transport				Senior Secured First Lien Term Loan (11.25% Cash, 2.50% Deferred)				6/30/2016				6,669,293				6,566,855				6,686,440				1.6	%
							Fee Note (14.88%)(6)				6/30/2016				250,000				164,853				164,853				0.0	%
							Warrants to purchase 10% of the outstanding equity				6/30/2016				N/A				25,000				468,307				0.1	%
															6,919,293				6,756,708				7,319,600
Brantley Transportation LLC			Oil and Gas				Senior Secured First Lien Term Loan (12.00	%)			8/2/2017				10,762,500				10,956,185				10,762,500				2.6	%
															10,762,500				10,956,185				10,762,500
Calloway Laboratories, Inc.			Healthcare, Education and Childcare				Senior Secured First Lien Term Loan (12.00% PIK)				9/30/2014				24,121,937				23,797,201				19,075,382				4.5	%
							Warrants to purchase 15% of the outstanding equity				9/30/2014				N/A				68,433				—				0.0	%
															24,121,937				23,865,634				19,075,382
Caregiver Services, Inc.			Healthcare, Education and Childcare				Senior Secured Second Lien Term Loan (12.45% Cash, 2.00% PIK)				12/29/2017				15,283,238				15,283,238				15,268,801				3.6	%
															15,283,238				15,283,238				15,268,801
Cenegenics LLC			Personal, Food and Miscellaneous Services				Senior Secured First Lien Term Loan (10.00% Cash, 2.25% PIK)				12/20/2017				19,601,755				19,601,755				19,666,529				4.7	%
															19,601,755				19,601,755				19,666,529
Dispensing Dynamics International(8)			Personal and Nondurable Consumer Products (Manufacturing Only)				Senior Secured Note (12.50	%)			1/1/2018				4,800,000				4,711,076				4,833,389				1.2	%
															4,800,000				4,711,076				4,833,389
DLR Restaurants LLC			Restaurant & Franchise				Senior Secured First Lien Term Loan (11.00% Cash, 2.50% PIK)				4/18/2018				9,622,039				9,622,039				9,622,039				2.3	%
							Unsecured Debt (12.00% Cash, 4.00% PIK)				4/18/2018				252,060				252,060				252,060				0.1	%
															9,874,099				9,874,099				9,874,099

 
 
See accompanying notes to consolidated financial statements.

TABLE OF CONTENTS

Company(1)		Industry				Type of Investment				Maturity				Par Amount(2)				Cost				Fair Value				% of Net Assets(3)
Exide Technologies(9)			Machinery (Nonagriculture, Nonconstruction, Nonelectric)				Senior Secured Note (8.63	%)			2/1/2018				11,000,000				9,006,908				6,668,750				1.6	%
															11,000,000				9,006,908				6,668,750
FC Operating LLC			Retail Stores				Senior Secured First Lien Term Loan (LIBOR + 10.75%, 1.25% LIBOR Floor)				11/14/2017				11,212,500				11,212,500				11,230,794				2.7	%
															11,212,500				11,212,500				11,230,794
Geneva Wood Fuels LLC(4)(10)			Personal and Nondurable Consumer Products (Manufacturing Only)				Senior Secured First Lien Term Loan (4.50% Cash, 10.50% PIK)				12/31/2014				8,199,184				8,143,385				4,090,000				1.0	%
															8,199,184				8,143,385				4,090,000
Harrison Gypsum LLC			Mining, Steel, Iron and Nonprecious Metals				Senior Secured First Lien Term Loan (LIBOR + 8.50% Cash, 0.50% PIK, 1.50% LIBOR Floor)				12/21/2017				24,408,401				24,408,401				24,425,174				5.8	%
															24,408,401				24,408,401				24,425,174
HD Vest, Inc.			Finance				Senior Secured Second Lien Term Loan (LIBOR + 8.00% Cash, 1.25% LIBOR Floor)				6/18/2019				8,750,000				8,750,000				8,640,625				2.1	%
															8,750,000				8,750,000				8,640,625
Help/Systems LLC			Business Services				Senior Secured Second Lien Term Loan (LIBOR + 8.50% Cash, 1.00% LIBOR Floor)				6/28/2020				15,000,000				15,000,000				14,400,000				3.4	%
															15,000,000				15,000,000				14,400,000
HGDS Acquisition LLC			Business Services				Senior Secured First Lien Term Loan (LIBOR + 12.00% Cash, 3.50% PIK)				3/28/2018				13,625,087				13,625,087				13,552,421				3.2	%
															13,625,087				13,625,087				13,552,421
Hoffmaster Group, Inc.			Personal and Nondurable Consumer Products (Manufacturing Only)				Senior Secured Second Lien Term Loan (LIBOR + 9.50% Cash, 1.50% LIBOR Floor)				1/3/2019				6,000,000				6,000,000				6,007,167				1.4	%
							Senior Secured Second Lien Term Loan (LIBOR + 9.00% Cash, 1.25% LIBOR Floor)				1/3/2019				2,000,000				1,982,405				1,942,667				0.5	%
															8,000,000				7,982,405				7,949,834
Ingenio Acquisition LLC			Personal, Food and Miscellaneous Services				Senior Secured First Lien Term Loan (12.75	%)			5/9/2018				25,000,000				25,000,000				25,000,000				5.9	%
															25,000,000				25,000,000				25,000,000
Insight Pharmaceuticals LLC			Personal, Food and Miscellaneous Services				Senior Secured Second Lien Term Loan (LIBOR + 11.75%, 1.50% LIBOR Floor)				8/25/2017				7,724,138				7,724,138				7,816,705				1.9	%
															7,724,138				7,724,138				7,816,705
Integra Telecom			Telecommunications				Senior Secured Second Lien Term Loan (LIBOR + 8.50% Cash, 1.25% LIBOR Floor)				2/22/2020				12,132,000				12,158,858				12,480,795				3.0	%
															12,132,000				12,158,858				12,480,795
Interface Security Systems(8)			Electronics				Senior Secured Note (9.25	%)			1/15/2018				3,333,000				3,333,000				3,399,660				0.8	%
															3,333,000				3,333,000				3,399,660
JD Norman Industries, Inc.			Diversified/Conglomerate Manufacturing				Senior Secured Second Lien Term Loan (13.50	%)			6/28/2018				12,500,000				12,500,000				12,500,000				3.0	%
															12,500,000				12,500,000				12,500,000
Kelley Amerit Holdings, Inc.			Business Services				Senior Secured Second Lien Term Loan (LIBOR + 9.70% Cash, 1.00% LIBOR Floor, 1.50% PIK)				12/21/2016				8,990,555				8,990,555				8,956,595				2.1	%
															8,990,555				8,990,555				8,956,595
Linc Energy Finance (USA), Inc.(8)			Oil and Gas				Senior Secured Note (12.50	%)			10/31/2017				3,500,000				3,387,276				3,832,500				0.9	%
															3,500,000				3,387,276				3,832,500
Meridian Behavioral Health LLC			Healthcare, Education and Childcare				Senior Secured First Lien Term Loan A (14.00	%)			11/14/2016				6,139,141				5,729,463				6,294,461				1.5	%
							Senior Secured First Lien Term Loan B (14.00	%)			11/14/2016				3,750,000				3,750,000				3,750,000				0.9	%
							Warrants to purchase 8% of the outstanding membership units				11/14/2016				N/A				536,296				1,063,521				0.2	%
															9,889,141				10,015,759				11,107,982