Newtek Business Services
Annual Report 2017

Plain-text annual report

Table of ContentsUNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549FORM 10-K(Mark One) xx ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31, 2017ORoo TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from _____to_____Commission file number: 814-01035 NEWTEK BUSINESS SERVICES CORP. (Exact name of registrant as specified in its charter) Maryland 46-3755188(State or other jurisdiction ofincorporation or organization) (I.R.S. EmployerIdentification No.) 1981 Marcus Avenue, Suite 130, Lake Success, New York 11042(Address of principal executive offices) (Zip Code)Registrant’s telephone number, including area code: (212) 356-9500Securities Registered Pursuant to Section 12(b) of the Act: Name of Each ExchangeTitle of Each Classon Which Registered Common Stock, par value $0.02 per shareNasdaq Global Market7.50% Notes due 2022Nasdaq Global Market7.00% Notes due 2021Nasdaq Global MarketSecurities Registered Pursuant to Section 12(g) of the Act: NoneIndicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No xIndicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨ No xIndicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirementsfor the past 90 days. Yes x No ¨Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required tobe submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter periodthat the registrant was required to submit and post such files). Yes ¨ No ¨Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (Section 229.405 of this chapter) is not contained herein, andwill not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. xIndicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company (all asdefined in Rule 12b-2 of the Exchange Act). Large accelerated filer ¨Accelerated filer x Non-accelerated filer ¨Smaller reporting company ¨ Emerging growth company ¨If an emerging growth company indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new orrevised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No xThe aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant was approximately $265,168,000 as of thelast business day of the registrant’s second fiscal quarter of 2017, based on a closing price on that date of $16.29 on the Nasdaq Global Market. For thepurposes of calculating this amount only, all directors and executive officers of the Registrant have been treated as affiliates.As of March 15, 2018, there were 18,547,030 shares issued and outstanding of the registrant’s Common Stock, par value $0.02 per share.DOCUMENTS INCORPORATED BY REFERENCEPortions of the registrant’s definitive Proxy Statement relating to the registrant’s 2018 Annual Meeting of Shareholders, to be filed with the Securities andExchange Commission within 120 days following the end of the Company’s fiscal year, are incorporated by reference in Part III of this Annual Report onForm 10-K as indicated herein.Table of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIESTABLE OF CONTENTS Item Page PART I 1.Business5 1A.Risk Factors36 1B.Unresolved Staff Comments67 2.Properties67 3.Legal Proceedings67 4.Mine Safety Disclosures67 PART II 5.Market for the Registrant’s Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities68 6.Selected Financial Data70 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations71 7A.Quantitative and Qualitative Disclosures About Market Risk93 8.Financial Statements and Supplementary Data94 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure94 9A.Controls and Procedures94 9B.Other Information95 PART III 10.Directors, Executive Officers and Corporate Governance95 11.Executive Compensation95 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters95 13.Certain Relationships, Related Party Transactions and Director Independence95 14.Principal Accounting Fees and Services96 PART IV 15.Exhibits and Financial Statement Schedules97 Exhibits Index97 Signatures100 Financial Statements101Table of ContentsDefined TermsWe have used “we,” “us,” “our”, “our company”, and “the Company” to refer to Newtek Business Services Corp. and its subsidiaries in this report. We alsohave used several other terms in this report, which are explained or defined below:Terms 1940 ActInvestment Company Act of 1940, as amended2016-1 TrustNewtek Small Business Loan Trust, Series 2016-12017-1 TrustNewtek Small Business Loan Trust, Series 2017-12021 Notes7% Notes due 20212022 Notes7.5% Notes due 20222023 Notes6.25% notes due 2023ASCAccounting Standards Codification, as issued by the FASBASUAccounting Standards Updates, as issued by the FASBATM Equity Distribution AgreementAt the Market equity distribution agreement between the Company and JMP Securities, LLC, CompassPoint Research & Trading, LLC, D.A. Davidson and Ladenburg Thalman & Co., Inc., as amended andrestated on September 6, 2017BDCBusiness Development Company under the 1940 ActBoardThe Company's board of directorsCapital OneCapital One Bank, N.A.CodeInternal Revenue Code of 1986, as amendedDRIPThe Company's dividend reinvestment planEBITDAEarnings before interest, taxes, depreciation and amortizationEquity Incentive PlanThe Company's 2015 Equity Incentive PlanExchange ActSecurities and Exchange Act of 1934, as amendedFASBFinancial Accounting Standards BoardGoldman FacilityCredit and Guaranty Agreement between UPSW, NTS, Premier, BSP, SBL GS Bank; as amended on June21, 2017Goldman SachsGoldman Sachs BankLIBORLondon Interbank Offered RateNAVNet Asset ValueRelated Party RLOCUnsecured revolving line of credit agreement between UPSW, NTS, Premier, BSP and SBL as lenders andNewtek as borrowerPLPPreferred Lender Program, as authorized by the SBARedemption DateMarch 23, 2018RICRegulated investment company under the CodeS&PStandard and Poor'sSBAUnited States Small Business AdministrationSBLCSmall Business Lending CompanySBICSmall Business Investment CompanySECSecurities and Exchange CommissionSMBSmall-and-medium sized businessesSterlingSterling National BankSterling 504 FacilityLoan and Security Agreement between NBCS and Sterling, as lender to fund SBA 504 loansSterling Receivable and Inventory FacilityLoan and Security Agreement between NBCS and Sterling, as lender to fund accounts receivable andinventory financing arrangementsTaxable SubsidiariesCompanies formed by Newtek which are taxed as corporations for income tax purposesTable of ContentsTrusteeU.S. Bank, N.A.U.S. GAAP or GAAPGenerally accepted accounting principles in the United States Portfolio Companies and Subsidiaries NSBFNewtek Small Business Finance, LLC, a consolidated subsidiaryExponentialExponential Business Development Co., Inc., a Taxable SubsidiaryUPSW or NMSUniversal Processing Services of Wisconsin, LLC dba Newtek Merchant Solutions, a wholly-ownedcontrolled portfolio companyPremierPremier Payments LLC, a wholly-owned controlled portfolio companyNTSNewtek Technology Solutions, Inc., a wholly-owned controlled portfolio companyIPMInternational Professional Marketing, Inc., a wholly-owned controlled portfolio companySIDCOSIDCO, LLC dba Cloud Nine Services, a wholly-owned controlled portfolio companyEWSExcel WebSolutions, LLC, a controlled portfolio companyNBCSCDS Business Services, Inc. dba Newtek Business Credit Solutions, a wholly-owned controlled portfoliocompanySBLSmall Business Lending, LLC, a wholly-owned controlled portfolio companyBSPADR Partners, LLC dba banc-serv Partners, LLC, a wholly-owned controlled portfolio companyNPSPMTWorks Payroll, LLC dba Newtek Payroll and Benefits Solutions, a wholly-owned controlled portfoliocompanyNIANewtek Insurance Agency, LLC, a wholly-owned controlled portfolio companyUCSUnited Capital Source, LLC, a wholly-owned controlled portfolio companyTAMTitanium Asset Management LLC, a wholly-owned controlled portfolio companyTable of ContentsPART IITEM 1. BUSINESS.We are an internally managed non-diversified closed-end management investment company that has elected to be regulated as a BDC under the 1940 Act.We have also elected to be treated as a RIC under the Code for U.S. federal income tax purposes, beginning with our 2015 tax year. We were formed tocontinue and expand the business of Newtek Business Services, Inc. We expect that our investments will typically be similar to the investments we madeprior to our reincorporation.As a BDC, our investment objective is to generate both current income and capital appreciation primarily through loans originated by our business financeplatform and our equity investments in certain portfolio companies that we control.Our BusinessWe are an internally managed BDC that is a leading national non-bank lender that provides, together with our controlled portfolio companies, a wide rangeof business services and financial products under the Newtek® brand to the SMB market. Newtek’s products and services include: Business Lendingincluding SBA 7(a) and 504 lending, Electronic Payment Processing, Managed Technology Solutions (Cloud Computing), eCommerce, AccountsReceivable and Inventory Financing, The Secure Gateway, The Newtek Advantage, personal and commercial lines Insurance Services, Web Services, DataBackup, Storage and Retrieval, and Payroll and Benefits Solutions to SMB accounts nationwide across all industries. We have an established and reliableplatform that is not limited by client size, industry type or location. As a result, we believe we have a strong and diversified client base across every state inthe U.S. and across a variety of different industries. In addition, we have developed a financial and technology based business model that enables us and ourcontrolled portfolio companies to acquire and process our SMB clients in a cost effective manner. This capability is supported in large part by NewTracker®,our patented prospect management technology software which is similar to but we believe is better than the system popularized by Salesforce.com. Webelieve that this technology and low cost business model distinguishes us from our competitors.We define SMBs as companies having revenues of $1,000,000 to $100,000,000. We focus on serving the SMB market, which we estimate to be over 27million businesses in the U.S. We believe that these businesses have historically been underserved by traditional financial institutions and typically lack thecapital resources to build a competitive business and marketing infrastructure on their own. Further, in today’s economic climate, we believe SMBs haveparticular difficulty obtaining capital from traditional lending sources. While we do not compete directly with alternative online lenders such as The LendingClub, Prosper.com, OnDeck Capital, Inc. and Kabbage Inc., we do provide financing solutions as an alternative to traditional lending. We believe there issignificant demand for such alternative financing among SMBs. Our lending solutions and our controlled portfolio companies’ outsourced business solutionshelp clients manage and grow their businesses and compete effectively in today’s marketplace. We obtain our customers through referrals from variousbusiness partners, such as banks, insurance companies, credit unions and other affinity groups, as well as through our own direct sales force and advertisingcampaigns. We source, acquire and process SMB customers in a cost effective manner without reliance on high cost sales staff and time consumingapplication processes.In lending, we believe we are a leading capital provider to SMBs based on our loan volume. We originate loans through a variety of sourcing channels andthrough a disciplined underwriting process, and seek to achieve attractive risk-weighted returns. Our multi-faceted relationships with certain borrowers allowus to closely monitor their credit profile and take an active role in managing our investments. Further, our lending capabilities, coupled with the broadoutsourced business solutions of our controlled portfolio companies, create attractive cross-selling opportunities within our client base. We believe ourbusiness model creates powerful network effects which will help drive growth and operating leverage in our business. In addition, our SBA 7(a) loansoriginated by NSBF are structured so that the government guaranteed portion can be rapidly sold, which, based on our historic ability to securitize theunguaranteed portions and assuming the continuation of current market conditions, allows us to quickly recover our principal and earn excess capital oneach SBA 7(a) loan, usually in less than a year. We may in the future determine to retain the government guaranteed or unguaranteed portions of SBA 7(a)loans pending deployment of excess capital. From 2012 through December 31, 2017, NSBF has consistently been the largest non-bank SBA 7(a) lender andcurrently is the sixth largest SBA 7(a) lender in the U.S. based on dollar lending volume.Our proprietary technology platform, The Newtek Advantage, which we make available to our controlled portfolio companies enables them to provide clientswith a real-time management solution that organizes all of a business’ critical transaction and economic, eCommerce and website traffic data on asmartphone, tablet, laptop or personal computer. This technology providesTable of Contentscritical consumer and marketing intelligence, including data mining, and provides a range of differentiated solutions and analytical tools that may be easilycustomized and integrated within their clients’ existing business processes. It also provides clients with seamless connectivity to a payment and managedtechnology infrastructure that is secure, fully compliant and regularly updated with the latest capabilities, services and functionalities. The platform isscalable to facilitate growth and meet the needs of new clients and consists solely of cloud-based offerings.Newtek and its controlled portfolio companies use NewTracker®, our patented and proprietary technology for receiving, processing and monitoringprospective customers. This enables Newtek and its controlled portfolio companies to acquire SMB customers in a cost effective manner as it is allaccomplished by skilled staff using state of the art technology without the need for high cost sales staff or applications processors. It also permits our referralpartners to have a real time window into the back office processing of the referrals they give. The software automatically pre-populates any necessary forms orapplications so the processing is efficient and also cost effective. Finally, it also identifies opportunities for the cross-sale of other Newtek branded productsor services.Business Finance PlatformSBA 7(a) LendingOur portfolio consists of guaranteed and unguaranteed non-affiliate SBA loan investments that were made through our business finance platform, whichincludes NSBF, a nationally licensed SBA lender under the federal Section 7(a) loan program. SBA 7(a) loans are partially guaranteed by the SBA, anindependent government agency that facilitates one of the nation’s largest sources of SMB financing. SBA guarantees typically range between 75% and 90%of the principal and interest due. NSBF has a dedicated Senior Lending Team that originates and services SBA 7(a) loans to qualifying SMBs. NSBF sells theguaranteed portions of its SBA 7(a) loans, typically within two weeks of origination, and retains the unguaranteed portion until accumulating sufficient loansfor a securitization. NSBF’s securitization process is as follows. After accumulating sufficient loans, the loans are transferred to a special purpose vehicle (a“Trust”), which in turn issues notes against the Trust’s assets in a private placement. The Trust’s primary source of income for repaying the securitizationnotes is the cash flows generated from the unguaranteed portion of SBA 7(a) loans now owned by the Trust; principal on the securitization notes will be paidby cash flow in excess of that needed to pay various fees related to the operation of the Trust and interest on the debt. Securitization notes have an expectedmaturity of about five years, and the Trust is dissolved when the securitization notes are paid in full.We intend to continue to expand our business finance platform primarily by expanding senior secured lending through NSBF. We believe NSBF’s SBAlicense, combined with NSBF’s PLP designation, provides us with a distinct competitive advantage over other SMB lenders that have not overcome thesesignificant barriers-to-entry in our primary loan market. NSBF originated approximately $385,882,000 of SBA 7(a) loans during 2017 and approximately$309,147,000 during 2016. We believe that we will continue to be introduced to a variety of high-quality investment opportunities through our existingloan sourcing channels and our controlled portfolio companies’ relationships with their clients, and our status as a BDC which helps fuel the growth of ourloan portfolio by providing us with better access to lower-cost capital.The SBA is an independent government agency that facilitates one of the nation’s largest sources of SMB financing by providing credit guarantees for itsloan programs. Under the SBA’s 7(a) lending program, a bank or other lender such as NSBF underwrites a loan between $50,000 and $5,000,000 for a varietyof general business purposes based on the SBA’s guidelines and the SBA provides a partial guarantee on the loan. Depending on the loan size, the SBAtypically guarantees between 75% and 90% of the principal and interest due. The recoveries and expenses on the unguaranteed portions of these loans areshared pari passu between the SBA and the lender, which substantially reduces the loss severity on the unguaranteed portion of a loan for SBA 7(a) loaninvestors. SBA 7(a) loans are typically between five and 25 years in maturity, four to five years in duration and bear interest at the prime rate plus a spreadfrom 2.25% to 2.75%. Since the guaranteed portions of SBA 7(a) loans carry the full faith and credit of the U.S. government, lenders may, and frequently do,sell the guaranteed portion of SBA 7(a) loans in the capital markets, hold the unguaranteed portion and retain all loan servicing rights.NSBF has a dedicated capital markets team that sells the guaranteed portions of its SBA 7(a) loans and sells or securitizes the unguaranteed portions of itsSBA 7(a) loans. Historically, NSBF has sold the guaranteed portions of its originated SBA 7(a) loans shortly after origination and retained the unguaranteedportions until accumulating sufficient loans for a securitization. Since inception, NSBF has sold SBA guaranteed portions of SBA 7(a) loans at premiumsranging from 106% to 120% of par value and typically any portion of the premium that is above 110% of par value is shared equally between NSBF and theSBA. Since December 2010, NSBF has maintained its securitization program for unguaranteed portions of its SBA 7(a) loans and has successfully completedeight securitization transactions with Standard & Poor’s AA or A ratings and attractive advance rates of approximately 70% of par value. NSBF’s most recentand largest securitization to date occurred in December 2017, when it sold $75,426,000 of unguaranteed SBA 7(a) loan-backed notes. NSBF intends tocomplete additional securitizations in the6Table of Contentsfuture which may be on comparable although not necessarily identical terms and conditions. We may determine to retain the government guaranteed orunguaranteed portions of loans, pending deployment of excess capital.NSBF’s senior lending team has focused on making smaller loans, approximately $1,000,000 or less, in order to maintain a diversified pool of loans that aredispersed both geographically and among industries, which limits NSBF’s exposure to regional and industry-specific economic downturns. Specifically, as ofDecember 31, 2017, NSBF’s loan portfolio consisted of 1,572 loans originated across 50 states in 77 different industries as defined by the North AmericanIndustry Classification System (“NAICS”). The following charts summarize NSBF’s mix of investment concentrations by industry and geography as ofDecember 31, 2017 (in thousands):Distribution by NAICS Code DescriptionNAICS Code Description Number of Loans AggregateBalance ($) Average Balance($) Percentage ofBalanceFood Services and Drinking Places 191 $27,855 $146 9.7%Amusement, Gambling, and Recreation Industries 89 20,163 227 7.0%Professional, Scientific, and Technical Services 98 16,871 172 5.9%Truck Transportation 57 16,287 286 5.7%Ambulatory Health Care Services 78 14,608 187 5.0%Repair and Maintenance 87 13,372 154 4.6%Specialty Trade Contractors 69 9,750 141 3.4%Food Manufacturing 18 9,238 513 3.2%Accommodation 42 8,791 209 3.1%Fabricated Metal Product Manufacturing 26 8,281 319 2.9%Other 817 142,474 174 49.5%Total 1,572 $287,690 $183 100.0%Distribution by StateState Number of Loans AggregateBalance ($) Average Balance($) Percentage ofBalanceFlorida 184 $33,324 $181 11.6%New York 187 31,326 168 10.9%California 117 19,306 165 6.7%Texas 84 18,212 217 6.3%Connecticut 100 16,770 168 5.8%Pennsylvania 69 15,179 220 5.3%Georgia 65 13,973 215 4.9%New Jersey 86 13,138 153 4.6%Illinois 49 12,030 246 4.2%North Carolina 54 10,585 196 3.7%Other 577 103,847 180 36.0%Total 1,572 $287,690 $183 100.0%NSBF evaluates the credit quality of its loan portfolio by employing a risk rating system that is similar to the Uniform Classification System, which is theasset classification system adopted by the Federal Financial Institution Examinations Council. NSBF’s risk rating system is granular with multiple riskratings in both the Acceptable and Substandard categories. Assignment of the ratings are predicated upon numerous factors, including credit risk scores,collateral type, loan to value ratios, industry, financial health of the business, payment history, other internal metrics/analysis, and qualitative assessments.Risk ratings are refreshed as appropriate based upon considerations such as market conditions, loan characteristics, and portfolio trends. NSBF’s gross SBAloans by credit quality indicator are as follows:7Table of ContentsRisk RatingPortfolio Number of Loans AggregateBalance ($) Average Balance($) Percentage ofBalanceRisk Rating 1 - 4 1,468 $263,501 $179 91.6%Risk Rating 5 8 953 119 0.3%Risk Rating 6 92 22,567 245 7.9%Risk Rating 6/7 and 7 4 669 167 0.2%Total 1,572 $287,690 $183 100.0%The weighted average term to maturity and weighted average interest rate of NSBF’s loan portfolio as of December 31, 2017 was 16.3 years and 6.9%,respectively.Receivables Financing, Inventory Financing and SBA 504 LendingThe business finance platform also includes NBCS, a controlled portfolio company, which provides receivables financing, inventory financing and healthcare receivables financing, and management services to SMBs, which may obtain $10,000 to $2,000,000 per month through the sale of their tradereceivables. In addition, NBCS funds SBA 504 loans which provide financing of fixed assets such as real estate or equipment.Third Party Loan ServicingSBL, a wholly owned, controlled portfolio company, engages in third-party loan servicing for SBA and non-SBA loans. An additional wholly ownedportfolio company, BSP, provides lending institutions with outsourced solutions for the entire SBA lending process, including credit analysis, structuringand eligibility, packaging, closing compliance and servicing.Controlled Portfolio CompaniesIn addition to our debt investments in portfolio companies, either directly or through our business finance platform, we also hold controlling interests incertain portfolio companies that, as of December 31, 2017, represented approximately 34% of our total investment portfolio. Specifically, we holdcontrolling interests in SBL, NBC, BSP, UPSW, Premier, NTS, NPS, NIA, IPM, SIDCO and UCS. We refer to these entities (among others), collectively, as our“controlled portfolio companies.” Our controlled portfolio companies provide us with an extensive network of business relationships that supplement ourreferral sources and that we believe will help us to maintain a robust pipeline of lending opportunities and expand our business finance platform.The revenues that our controlled portfolio companies generate, after deducting operating expenses, may be distributed to us. As a BDC, our Board willdetermine quarterly the fair value of our controlled portfolio companies in a similar manner as our other investments. In particular, our investments in ourcontrolled portfolio companies are valued using a valuation methodology that incorporates both the market approach (guideline public company method)and the income approach (discounted cash flow analysis). In following these approaches, factors that we may take into account in determining the fair valueof our investments include, as relevant: available current market data, including relevant and applicable market trading comparables, the portfolio company’searnings and discounted cash flows of forecasted future earnings, comparisons of financial ratios of peer companies that are public, and enterprise values,among other factors. In addition, the Company has engaged third party valuation firms to provide valuation consulting services for the valuation of certain ofour controlled portfolio companies.Newtek Merchant Solutions (NMS) and Newtek Payment Solutions (Premier)Both NMS and Premier market credit and debit card processing services, check approval services and ancillary processing equipment and software tomerchants who accept credit cards, debit cards, checks and other non-cash forms of payment. They utilize a multi-pronged sales approach of both direct andindirect sales. NMS and Premier’s primary sales efforts focus on direct sales through our Your Business Solutions Company® brand. Their indirect saleschannels consist of alliance partners, principally financial institutions (banks, credit unions, insurance companies and other related businesses), andindependent sales agents across the U.S. These referring organizations and associations are typically paid a percentage of the processing8Table of Contentsrevenue derived from the respective merchants that they successfully refer to NMS and Premier. In 2017, NMS and Premier processed merchant transactionswith sales volumes of over $6.1 billion combined.NMS and Premier have a number of competitive advantages which we believe will enable them to exceed industry growth averages. These are:•They focus on non-traditional business generation: referral relationships, wholesale solicitations and financial institutions rather than independentsales agents;•They are market leaders in the implementation of technology in the payment processing business;•They maintain their own staff of trained and skilled customer service representatives; and•They market and sell the latest in point-of-sale technology hardware, implementing of the EMV system (Europay, MasterCard, Visa inter-operativeintegrated circuit cards) and continuous cyber-security services.NMS and Premier maintain their principal customer service and sales support offices in Milwaukee, Wisconsin and Lake Success, New York, with additionalspecialists located in Phoenix, Arizona. NMS’ and Premier’s personnel assist merchants with initial installation of equipment and on-going service, as well asany other special processing needs that they may have.NMS’ (a 2001 investment) and Premier’s (a July 2015 investment) development and growth are focused on selling their services to internally generatedreferrals, merchant referrals identified by Newtek alliance partners and by independent sales representatives. We believe NMS and Premier are different thanmost electronic payment processing companies who acquire their clients primarily through independent agents. NMS and Premier believe that their businessmodels provide them with a competitive advantage by enabling them to acquire new merchant customers at a lower cost level for third-party commissionsthan the industry average. NMS’ and Premier’s business models allows them to own the customer as well as the stream of residual payments, as opposed tomodels which rely more heavily on independent sales agents.Newtek Technology Solutions (NTS)NTS offers website hosting, dedicated server hosting, cloud hosting, web design and development, internet marketing, eCommerce, data storage and backup,and other related services to more than 91,000 customer accounts in 167 countries and manages over 69,000 domain names. While there are manycompetitors in this space, we believe that NTS is the only technology company with the exclusive focus on the SMB market with products tailored to thespecific needs of these business customers.NTS provides a full suite of outsourced IT infrastructure services, including cloud (virtual) servers, shared server hosting, and dedicated server hosting, underthe Newtek® Technology Solutions, Newtek® Web Services and Newtek Web Hosting® brands, for which it receives recurring monthly fees, as well as otherfees such as set-up fees, consulting fees, and domain name registration fees, among others.Due to the continuing decline in Microsoft being utilized in the design of web sites and the market shift to Linux, Nginx and a proliferation of Word Presssites being built on non-Microsoft based platforms, Microsoft’s new web design growth has decreased to 33% of the market. NTS has responded to thisdecline by launching Linux Apache and Linux Nginx platforms within its environment and created associated control panels, service/support and billing toparticipate more fully in 100% of the market. All platforms are available within NTS’ cloud and non-cloud environment and are fully managed offerings ascompared to NTS’ competitors. In addition, Newtek has created a patented proprietary platform, Newtek Advantage, which leverages NTS’ underlyingtechnologies to deliver real time information and actionable business intelligence to its existing and new customer base.NTS has a complete line of cloud based business and eCommerce packages and Cloud Spaces to streamline the decision process for business owners andaccommodate designers and developers that wish to build sites in both Microsoft and Linux environments. Included with this service offering is full customerservice with a real human interface available on a 24/7/365 basis, which we believe further distinguishes NTS from its competitors who usually offer co-location hosting without the support needed for the SMB market customer.NTS currently operates five data centers in Scottsdale, Arizona, Phoenix, Arizona, Edison, New Jersey, Denver, Colorado and Slough, England.9Table of ContentsThe datacenter facilities NTS employs to host its technologies conforms to The Uptime Institute’s 4-Tier Classification System which has become a globalstandard for third-party validation of data center critical infrastructure. The Tier Classification System defines the requirements and benefits of four distinctTier classifications for data center infrastructure. Each Tier sets the appropriate criteria for power, cooling, maintenance, and capability to withstand a fault.Tiers are progressive; each Tier incorporates the requirements of all the lower Tiers. NTS operates its critical infrastructure within facilities that have aminimum rating of Tier 3-Certified. NTS datacenters meet and exceed Uptime Institute Tier-3 standards in all categories which allows NTS to pursue andservice, compliance-sensitive workloads from the financial services, healthcare, government and military sectors. In addition, NTS includes redundant,carrier-neutral network design for all its communications paths, multiple locations to host services, and a built in DDOS mitigation platform into the designof its datacenter services.Throughout its affiliation with Newtek, over 70% of new NTS customers have come as a result of internal and external referrals without material expendituresby NTS for marketing or advertising. Many of NTS’ competitors are very price sensitive, offering minimal services at cut-rate pricing. While being costcompetitive with most Linux-and Windows-based web hosting services, NTS has emphasized higher quality uptime, service and support as well as multiplecontrol panel environments for the designer and developer community.NTS has also launched a turnkey hosting service to meet financial institution needs for dedicated servers, hosting and/or data storage, enabling these entitiesto comply with their strict regulatory requirements that demand very high security protocols and practices be in place.In addition, IPM and SIDCO, are wholly-owned portfolio companies which consult, strategize, design, and implement technology solutions for enterprise andcommercial clients across the U.S., and are expected to complement the offerings of NTS.NTS has become aware that an unauthorized third party misappropriated three domain names, which NTS uses to support customer management of hostedwebsites. NTS has notified its shared webhosting customers of the incident, and has assisted in re-routing web traffic to minimize any service disruptions toits clients.NTS’ management has launched an investigation into the incident. Based on the investigation to date, NTS’ management believes that attackerscompromised a portion of its shared webhosting system, and may have acquired certain customer information limited to its shared webhosting customers,and/or gained access to certain of its shared webhosting servers. While the investigation remains ongoing, NTS has taken a range of steps designed to secureits system, enhance its security protections, enhance access controls, and prevent future unauthorized activity. NTS is also working with forensicinvestigators to fully assess the incident and take additional remedial measures.As a result of the incident, the Company reduced the fair value of its investment in NTS, a wholly-owned portfolio company, from $16,000,000 as ofSeptember 30, 2017, to $12,400,000 at December 31, 2017 (approximately 4.46% of the Company’s $278,329,000 of net assets as of December 31, 2017, aspreviously disclosed on March 5, 2018).Newtek Insurance Agency (NIA)NIA, which is licensed in 50 states, serves as a retail and wholesale brokerage insurance agency specializing in the sale of personal, commercial andhealth/benefits lines insurance products to customers of all of the Newtek portfolio companies as well as Newtek alliance partners. NIA offers insuranceproducts from multiple insurance carriers providing a wide range of choice for its customers. NIA is also implementing programs with alliance partners tomarket commercial and personal insurance. In December 2012, NIA, working with another Newtek subsidiary, acquired a portfolio of insurance business froma health care insurance agency based in the New York City area. This added approximately 340 group health insurance policies that NIA is servicing andforms the basis on which NIA is growing this aspect of the insurance business. A major sales channel for NIA is the SMB customer base of our lendingplatform and the other controlled portfolio companies which allow for many opportunities for cross sales between business lines.Newtek Payroll and Benefits Solutions (NPS)NPS offers an array of industry standard and very competitively priced payroll management, benefit, payment and tax reporting services to SMBs. Thesepayroll and benefit solutions are marketed through all of Newtek’s available channels including the alliance partnerships and direct marketing campaigns.NPS also benefits by the access to the SMB customer base of the lending platform and the other controlled portfolio companies.10Table of ContentsNPS provides full service payroll and benefit solutions across all industries, processing payroll via software as a service (SaaS) or phone solutions. They havean established and reliable platform that is not limited by client size, industry type or delivery interface. NPS assists clients in managing their payrollprocessing needs by calculating, collecting and disbursing their payroll funds, remitting payroll taxes and preparing and filing all associated tax returns. Inaddition, NPS offers clients a range of ancillary service offerings, including workers’ compensation insurance, time and attendance, 401(k) administration,pay cards, employee benefit plans, employee background screening, COBRA services, tax credit recovery, Section 125 and flexible benefits spending plansand expense management services.Certified Capital Companies (Capcos)Under state-created Capco programs, states provide a Capco with tax credits generally equal to the amount of funds the Capco raises from insurance companyinvestors. The Capcos then issue the tax credits to its investors — a process which is designed to reduce the Capco’s investors’ state tax liabilities. Inexchange for receiving the tax credits, the Capco is obligated to invest the funds raised in certain qualified businesses, which generally are defined by statuteto include only businesses that meet certain criteria related to the size, location, number of employees, and other characteristics of the business. If a Capcofails to comply with the performance requirements of each state’s different Capco program, the tax credits are subject to forfeiture.Under state law, a Capco that has invested in qualified businesses an amount equal to 100% of its initial certified capital is able to decertify (i.e., terminate itsstatus as a Capco) and no longer be subject to any state Capco regulation. Upon voluntary decertification, the programs in about half of the states require thata Capco share any distributions to its equity holders with the state sponsoring the Capco. For those states that require a share of distributions, the sharingpercentages vary, but are generally from 10% to 30%, usually on distributions above a specified internal rate of return for the equity owners of the Capco.Based on the above and that the Capcos were formed to make investments in businesses, the entities were determined to be investment companies and aretherefore consolidated subsidiaries of Newtek.Our Capcos have historically invested in SMBs and, in addition to interest income and investment returns, have generated non-cash income from tax creditsand non-cash interest and insurance expenses in addition to cash management fees and expenses. We have de-emphasized our Capco business in favor ofgrowing our controlled portfolio companies and do not anticipate creating any new Capcos. While observing all requirements of the Capco programs and, inparticular, financing qualified businesses meeting applicable state requirements as to limitations on the proportion of ownership of qualified businesses, webelieve the growth of our controlled portfolio companies produces a strategic focus on providing goods and services to SMBs such as those in which ourCapcos invest. We continue to invest in and lend to SMBs through our existing Capcos and intend to meet the goals of the Capco programs.As the Capcos reach 100% investment we will seek to decertify them as Capcos, liquidate their remaining assets and thereby reduce their operational costs,particularly the legal and accounting costs associated with compliance. Nine of our original sixteen Capcos have reached this stage.Newtek BrandingWe have developed our branded line of products and services to offer a full service suite of business and financial solutions for the U.S. SMB market. Newtekreaches potential customers through its integrated multi-channel approach featuring direct, indirect and direct outbound solicitation efforts. We continue toutilize and grow our primary marketing channel of strategic alliance partners as well as a direct marketing strategy to SMB customers through our “go tomarket” brand, Your Business Solutions Company®. Through a television advertising campaign built around this brand, and our webpresence, www.newtekone.com, we believe we are establishing ourselves as a preferred “go-to” provider for SMB financing and the services offered by ourcontrolled portfolio companies. In addition, we supplement these efforts with extensive efforts to present the Company as the authority on small businesses.We market services through referrals from our strategic alliance partners such as AIG, Amalgamated Bank, Credit Union National Association, E-Insure, ENTFederal Credit Union, The Hartford, Legacy Bank, Morgan Stanley Smith Barney, Navy Federal Credit Union, New York Community Bank, Lending Tree,LLC, Randolph Brooks Federal Credit Union, UBS , Meineke Dealers Purchasing Cooperative and True Value Company, among others, (using our patentedNewTracker® referral management system) as well as direct referrals from our web presence, www.newtekone.com. Our NewTracker® referral system has asoftware application patent covering the systems and methods for tracking, reporting and performing processing activities and transactions in associationwith referral data and related information for a variety of product and service offerings in a business-to-business environment. The NewTracker® systemprovides for transparency between Newtek and referring parties and has been material in our ability to obtain referrals from a wide variety of sources. Thispatented system allows us11Table of Contentsand our alliance partners to review in real time the status of any referral as well as to provide real time compliance oversight by the respective alliance partner,which we believe creates confidence among the referred business client, the referring alliance partner and us. We own the NewTracker® patent, as well as alltrademarks and other patented intellectual property used by us and our controlled portfolio companies.Additional referrals are obtained from individual professionals in geographic markets that have signed up to provide referrals and earn commissions throughour BizExec and TechExec Programs. Our BizExecs and TechExecs are traditionally information technology professionals, CPAs, independent insuranceagents and sales and/or marketing professionals. In addition, electronic payment processing services are marketed through independent sales agents, and webtechnology and eCommerce services are marketed through internet-based marketing and third-party resellers. A common thread across all business lines ofour controlled portfolio companies relates to acquiring customers at low cost and making strategic alliances primarily where we pay fees only for successfulreferrals. We seek to bundle our marketing efforts through our brand, our portal, our patented NewTracker® referral system, our web presence as Your BusinessSolutions Company® and one easy entry point of contact. We expect that this approach will allow us to continue to cross-sell the financing services of ourbusiness finance platform to customers of our controlled portfolio companies and build upon our extensive deal sourcing infrastructure. The compensationwhich we pay for referrals is consistent with industry practices.Senior Lending Team and Executive CommitteeThe key members of our Senior Lending Team, most of which have worked together for more than ten years each have over 25 years of experience in finance-related fields. These investment professionals have worked together to screen opportunities, underwrite new investments and manage a portfolio ofinvestments in SMBs through two recessions, a credit crunch, the dot-com boom and bust and a historic, leverage-fueled asset valuation bubble. Eachmember brings a complementary component to a team well-rounded in finance, accounting, operations, strategy, business law and executive management.Because we are internally managed by our Executive Committee, which includes Barry Sloane, Peter Downs, Jennifer C. Eddelson, Michael A. Schwartz, andJohn Raven, under the supervision of our Board, and do not depend on a third-party investment advisor, we do not pay investment advisory fees and all ofour income is available to pay our operating costs and to make distributions to our shareholders. While our portfolio companies are independently managed,our Executive Committee also oversees our controlled portfolio companies and, to the extent that we may make additional equity investments in the future,the Executive Committee will also have primary responsibility for the identification, screening, review and completion of such investments. We do notexpect to focus our resources on investing in additional stand-alone equity investments, but may elect to do so from time to time on an opportunistic basis, ifsuch opportunities arise. Messrs. Sloane and Downs have been involved together in the structuring and management of equity investments for the pastfourteen years.Market OpportunityWe believe that the limited amount of capital and financial products available to SMBs, coupled with the desire of these companies for flexible andpartnership-oriented sources of capital and other financial products, creates an attractive investment environment for us to further expand our businessfinance platform and overall brand. We believe the following factors will continue to provide us with opportunities to grow and deliver attractive returns toshareholders.The SMB market represents a large, underserved market. We estimate the SMB market to include over 27 million businesses in the U.S. We believe thatSMBs, most of which are privately-held, are relatively underserved by traditional capital providers such as commercial banks, finance companies, hedgefunds and collateralized loan obligation funds. Further, we believe that such companies generally possess conservative capital structures with significantenterprise value cushions, as compared to larger companies with more financing options. While the largest originators of SBA 7(a) loans have traditionallybeen regional and national banks, from 2012 through 2017, NSBF was the largest non-bank originator of SBA 7(a) loans by dollar lending volume and iscurrently the sixth largest SBA 7(a) lender in the U.S. As a result, we believe we and our controlled portfolio companies are well positioned to providefinancing to the types of SMBs that we have historically targeted and we have the technology and infrastructure in place presently to do it cost effectively inall 50 states and across many industries.Future refinancing activity is expected to create additional investment opportunities. A high volume of financings completed between 2005 and 2008 willmature in the coming years. We believe this supply of opportunities coupled with limited financing providers focused on SMBs will continue to offerinvestment opportunities with attractive risk-weighted returns.The increased capital requirements and other regulations placed on banks may reduce lending by traditional large financial institutions and communitybanks. While many SMBs were previously able to raise debt financing through traditional large financial institutions, we believe this approach to financingwill continue to be constrained for several years as continued12Table of Contentsimplementation of U.S. and international financial reforms, such as Basel III, phase in and rules and regulations are promulgated under the Dodd-Frank WallStreet Reform and Consumer Protection Act. We believe that these regulations will increase capital requirements and have the effect of further limiting thecapacity of traditional financial institutions to hold non-investment grade loans on their balance sheets. As a result, we believe that many of these financialinstitutions have de-emphasized their service and product offerings to SMBs, which we believe will make a higher volume of deal flow available to us.Increased demand for comprehensive, business-critical SMB solutions. Increased competition and rapid technological innovation are creating anincreasingly competitive business environment that requires SMBs to fundamentally change the way they manage critical business processes. Thisenvironment is characterized by greater focus on increased quality, lower costs, faster turnaround and heightened regulatory scrutiny. To make necessarychanges and adequately address these needs, we believe that companies are focusing on their core competencies and utilizing cost-effective outsourcedsolutions to improve productivity, lower costs and manage operations more efficiently. Our controlled portfolio companies provide critical businesssolutions such as electronic payment processing, managed IT solutions, personal and commercial insurance services and full-service payroll and benefitsolutions, receivables financing and funding of SBA 504 loans which provide financing of fixed assets such as real estate or equipment. We believe that eachof these market segments are underserved for SMBs and since we are able to provide comprehensive solutions under one platform, we are well positioned tocontinue to realize growth from these product offerings.Competitive AdvantagesWe believe that we are well positioned to take advantage of investment opportunities in SMBs due to the following competitive advantages:Internally Managed Structure and Significant Management Resources. We are internally managed by our executive officers under the supervision of ourBoard and do not depend on an external investment advisor. As a result, we do not pay investment advisory fees and all of our income is available to pay ouroperating costs, which include employing investment and portfolio management professionals, and to make distributions to our shareholders. We believethat our internally managed structure provides us with a lower cost operating expense structure, when compared to other publicly traded and privately-heldinvestment firms which are externally managed, and allows us the opportunity to leverage our non-interest operating expenses as we grow our investmentportfolio. Our senior lending team has developed one of the largest independent loan origination and servicing platforms that focuses exclusively on SMBs.Business Model Enables Attractive Risk-Weighted Return on Investment in SBA 7(a) Lending. Our SBA 7(a) loans are structured so as to permit rapid saleof the U.S. government guaranteed portions, often within weeks of origination, and the unguaranteed portions have been successfully securitized and sold,usually within a year of origination. The return of principal and premium may result in an advantageous risk-weighted return on our original investment ineach loan. We may determine to retain the government guaranteed or unguaranteed portions of loans pending deployment of excess capital.State of the Art Technology. Our patented NewTracker® software enables us to board a SMB customer, process the application or inquiry, assemble necessarydocuments, complete the transaction and create a daily reporting system that is sufficiently unique as to receive a U.S. patent. This system enables us toidentify a transaction, similar to a merchandise barcode or the customer management system used by SalesForce.com, then process a business transaction andgenerate internal reports used by management and external reports for strategic referral partners. It allows our referral partners to have digital access into ourback office and follow on a real time, 24/7 basis the processing of their referred customers. This technology has been made applicable to all of the service andproduct offerings we make directly or through our controlled portfolio companies.Established Direct Origination Platform with Extensive Deal Sourcing Infrastructure. We have established a direct origination pipeline for investmentopportunities without the necessity for investment banks or brokers as well as broad marketing channels that allow for highly selective underwriting. Thecombination of our brand, our portal, our patented NewTracker® technology, and our web presence as Your Business Solutions Company® have created anextensive deal sourcing infrastructure. Although we pay fees for loan originations that are referred to us by our alliance partners, our investment team worksdirectly with the borrower to assemble and underwrite loans. We rarely invest in pre-assembled loans that are sold by investment banks or brokers. As a result,we believe that our unique national origination platform allows us to originate attractive credits at a low cost. During 2017 we funded $385,882,000 of SBA7(a) loans, based on the large volume of loan referrals we received in 2017. We anticipate that our principal source of investment opportunities will continueto be in the same types of SMBs to which we currently provide financing. Our Executive Committee and Senior Lending Team will also seek to leverage theirextensive network of additional referral sources, including law firms, accounting firms, financial, operational and strategic consultants and financialinstitutions, with whom we have completed investments. We believe our13Table of Contentscurrent infrastructure and expansive relationships will continue to enable us to review a significant amount of high quality, direct (or non-brokered)investment opportunities.Experienced Senior Lending Team with Proven Track Record. We believe that our Senior Lending Team is one of the leading capital providers to SMBs.Our Senior Lending Team has expertise in managing the SBA process and has managed a diverse portfolio of investments with a broad geographic andindustry mix. While the primary focus of NSBF is to expand its debt financing activities in SBA 7(a) loans, our Executive Committee also has substantialexperience in making debt and equity investments through our Capcos.Flexible, Customized Financing Solutions for Seasoned, Smaller Businesses. While NSBF’s primary focus is to expand its lending by activities byproviding SBA 7(a) loans to SMBs, we also seek to offer SMBs a variety of attractive financing structures, as well as cost effective and efficient businessservices, to meet their capital needs through our subsidiaries and controlled portfolio companies. In particular, through our controlled portfolio companies,we offer larger loans, between $5,000,000 and $10,000,000, greater than loans available with the SBA guarantee, but with a higher interest rate tocompensate for the increased risk. Unlike many of our competitors, we believe we have the platform to provide a complete package of service and financingoptions for SMBs, which allows for cross-selling opportunities and improved client retention. We expect that a large portion of our capital will be loaned tocompanies that need growth capital, acquisition financing or funding to recapitalize or refinance existing debt facilities. Our lending will continue to focuson making loans to SMBs that:•have 3 to 10 years of operational history;•significant experience in management;•credit worthy owners who provide a personal guarantee for our investment;•show a strong balance sheet to collateralize our investments; and•show sufficient cash flow to be able to service the payments on our investments comfortably.Although we may make investments in start-up businesses, we generally seek to avoid investing in high-risk, early-stage enterprises that are only beginningto develop their market share or build their management and operational infrastructure with limited collateral.Disciplined Underwriting Policies and Rigorous Portfolio Management. We pursue rigorous due diligence of all prospective investments originatedthrough our platform. Our senior lending team has developed an extensive underwriting due diligence process, which includes a review of the operational,financial, legal and industry performance and outlook for the prospective investment, including quantitative and qualitative stress tests, review of industrydata and consultation with outside experts regarding the creditworthiness of the borrower. These processes continue during the portfolio monitoring process,when we will conduct field examinations, review all compliance certificates and covenants and regularly assess the financial and business conditions andprospects of portfolio companies. In addition, SBL and BSP are servicers for commercial, SBA 7(a) and other government guaranteed investments whoseexceptional servicing capabilities with compact timelines for loan resolutions and dispositions has attracted various third-party portfolios to these controlledportfolio companies.Business Development Company ConversionOn October 22, 2014, we effectuated a 1 for 5 reverse stock split to attract institutional investors. On November 12, 2014, in conjunction with the completionof a public offering, we merged with and into Newtek Business Services Corp., a newly-formed Maryland corporation, for the purpose of reincorporating inMaryland and we elected to be regulated as a BDC under the 1940 Act (the “BDC Conversion”). In connection with our election to be regulated as a BDC, weelected to be treated for U.S. federal income tax purposes, beginning with our 2015 tax year, and intend to qualify annually thereafter, as a RIC underSubchapter M of the Code. In connection with our election of RIC status, on October 1, 2015 our Board declared a special dividend of $2.69 per share whichwas paid partially in cash and partially in our common shares on December 31, 2015.As a BDC, we are required to meet regulatory tests, including the requirement to invest at least 70% of our gross assets in “qualifying assets.” Qualifyingassets generally include debt or equity securities of private or thinly traded public U.S. companies and cash, cash equivalents, U.S. government securities andhigh-quality debt investments that mature in one year or less. In addition, as a BDC, we are not permitted to incur indebtedness unless immediately after suchborrowing we have an asset coverage for total borrowings of at least 200% (i.e., the amount of debt may not exceed 50% of the value of our total assets). See“Regulation.”14Table of ContentsAs a RIC, we generally will not have to pay corporate-level federal income taxes on any ordinary income or capital gains that we distribute to ourshareholders. To maintain our RIC tax treatment, we must meet specified source-of-income and asset diversification requirements and distribute annually atleast 90% of our ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, if any.InvestmentsWe engage in various investment strategies from time to time in order to achieve our overall investment objectives.Portfolio Company CharacteristicsWe have and will continue to target investments in future portfolio companies that generate both current income and capital appreciation. In each case, thefollowing criteria and guidelines are applied to the review of a potential investment however, not all criteria are met in every single investment, nor do weguarantee that all criteria will be met in the investments we will make in the future. We have and will continue to limit our investments to the SMB market.Experienced Senior Investment Teams with Meaningful Investment. We seek to invest in companies in which senior or key managers have significantcompany-or industry-level experience and have significant equity ownership. It has been our experience that these senior investment teams are morecommitted to the portfolio company’s success and more likely to manage the company in a manner that protects our debt and equity investments.Significant Invested Capital. We believe that the existence of an appropriate amount of equity beneath our debt capital provides valuable support for ourinvestment. In addition, the degree to which the particular investment is a meaningful one for the portfolio company’s owners (and their ability andwillingness to invest additional equity capital as and to the extent necessary) are also important considerations.Appropriate Capital Structures. We seek to invest in portfolio companies that are appropriately capitalized. First, we examine the amount of equity that isbeing invested by the company’s equity owners to determine whether there is a sufficient capital cushion beneath our invested capital. We also analyze theamount of leverage, and the characteristics of senior debt with lien priority over our senior subordinated debt. A key consideration is a strong balance sheetand sufficient free cash flow to service any debt we may invest.Strong Competitive Position. We invest in portfolio companies that have developed strong, defensible product or service offerings within their respectivemarket segment(s). These companies should be well positioned to capitalize on organic and strategic growth opportunities, and should compete in industrieswith strong fundamentals and meaningful barriers to entry. We further analyze prospective portfolio investments in order to identify competitive advantageswithin their industry, which may result in superior operating margins or industry-leading growth.Customer and Supplier Diversification. We expect to invest in portfolio companies with sufficiently diverse customer and supplier bases. We believe thesecompanies will be better able to endure industry consolidation, economic contraction and increased competition than those that are not sufficientlydiversified. However, we also recognize that from time to time, an attractive investment opportunity with some concentration among its customer base orsupply chain will present itself. We believe that concentration issues can be evaluated and, in some instances (whether due to supplier or customer product orplatform diversification, the existence and quality of long-term agreements with such customers or suppliers or other select factors), mitigated, thuspresenting a superior risk-weighted pricing scenario.Investment ObjectivesDebt InvestmentsWe target our debt investments, which are principally made through our business finance platform under the SBA 7(a) program, to produce a coupon rate ofprime plus 2.75% which enables us to generate rapid sales of loans in the secondary market historically producing gains and with a yield on investment inexcess of 30%. We typically structure our debt investments with the maximum seniority and collateral along with personal guarantees from portfoliocompany owners, in many cases collateralized by other assets including real estate. In most cases, our debt investment will be collateralized by a first lien onthe assets of the portfolio company and a first or second lien on assets of guarantors, in both cases primarily real estate. All SBA loans are made with personalguarantees from any owner(s) of 20% or more of the portfolio company’s equity. As of15Table of ContentsDecember 31, 2017, substantially all of our SBA 7(a) portfolio at fair value consisted of debt investments that were secured by first or second priority liens onthe assets of the portfolio company.•First Lien Loans. Our first lien loans generally have terms of one to twenty-five years, provide for a variable interest rate, contain no prepaymentpenalties (however, the SBA will charge the borrower a prepayment fee if the loan has a maturity of 15 or more years and is prepaid during the firstthree years) and are secured by a first priority security interest in all existing and future assets of the borrower. Our first lien loans may take manyforms, including revolving lines of credit, term loans and acquisition lines of credit.•Second Lien Loans. Our second lien loans generally have terms of five to twenty five years, also primarily provide for a variable interest rate,contain no prepayment penalties (however, the SBA will charge the borrower a prepayment fee if the loan has a maturity of 15 or more years and isprepaid during the first three years) and are secured by a second priority security interest in all existing and future assets of the borrower. Wetypically only take second lien positions on additional collateral where we also have first lien positions on business assets.•Unsecured Loans. We make few unsecured investments, primarily to our controlled portfolio companies, which because of our equity ownership aredeemed to be more secure. Typically, these loans are to meet short-term funding needs and are repaid within 6 to 12 months.We typically structure our debt investments to include non-financial covenants that seek to minimize our risk of capital loss such as lien protection andprohibitions against change of control. Our debt investments have strong protections, including default penalties, information rights and, in some cases,board observation rights and affirmative, negative and financial covenants.Equity InvestmentsWhile the vast majority of our investments have been structured as debt, we have in the past and expect in the future to make selective equity investmentsprimarily as either strategic investments to enhance the integrated operating platform or, to a lesser degree, under the Capco programs. For investments in ourcontrolled portfolio companies, we focus more on tailoring them to the long term growth needs of the companies than to immediate return. Our objective withthese companies is to foster the development of the businesses as a part of the integrated operational platform of serving the SMB market, so we may reducethe burden on these companies to enable them to grow faster than they would otherwise as another means of supporting their development and that of theintegrated whole.In Capco investments, we often make debt investments in conjunction with being granted equity in the company in the same class of security as the businessowner receives upon funding. We generally seek to structure our equity investments to provide us with minority rights provisions and event-driven putrights. We also seek to obtain limited registration rights in connection with these investments, which may include “piggyback” registration rights.Investment ProcessThe members of our Senior Lending Team and our Executive Committee are responsible for all aspects of our investment selection process. The discussionbelow describes our investment procedures. The stages of our investment selection process are as follows:Loan and Deal Generation/OriginationWe believe that the combination of our brand, our portal, our patented NewTracker® technology, and our web presence as Your Business SolutionsCompany® have created an extensive loan and deal sourcing infrastructure. This is maximized through long-standing and extensive relationships withindustry contacts, brokers, commercial and investment bankers, entrepreneurs, services providers (such as lawyers and accountants), as well as current andformer clients, portfolio companies and our extensive network of strategic alliance partners. We supplement our relationships by the selective use of radioand television advertising aimed primarily at lending to the SMB market. We believe we have developed a reputation as a knowledgeable and reliable sourceof capital, providing value-added advice, prompt processing, and management and operations support to our portfolio companies.We market our loan and investment products and services, and those of our controlled portfolio companies, through referrals from our alliance partners suchas AIG, Amalgamated Bank, Credit Union National Association, E-Insure, ENT Federal Credit Union, The Hartford, Legacy Bank, Morgan Stanley SmithBarney, Navy Federal Credit Union, New York Community Bank,16Table of ContentsLending Tree, LLC, Randolph Brooks Federal Credit Union, UBS Bank, Meineke Dealers Purchasing Cooperative and True Value Company, among othersusing our patented NewTracker® referral system as well as direct referrals from our web presence, www.newtekone.com. The patent for our NewTracker®referral system is a software application patent covering the systems and methods for tracking, reporting and performing processing activities and transactionsin association with referral data and related information for a variety of product and service offerings in a business-to-business environment providing furtherfor security and transparency between referring parties. This system allows us and our alliance partners to review in real time the status of any referral as wellas to provide real time compliance oversight by the respective alliance partner, which we believe creates confidence between the referred business client, thereferring alliance partner and us.Additional deal sourcing and referrals are obtained from individual professionals in geographic markets that have signed up to provide referrals and earncommissions through our BizExec and TechExec Programs. The BizExecs and TechExecs are traditionally information technology professionals, CPAs,independent insurance agents and sales and/or marketing professionals. In addition, electronic payment processing services are marketed throughindependent sales representatives and web technology and eCommerce services are marketed through internet-based marketing and third-party resellers. Acommon thread across all business lines of our subsidiaries and controlled portfolio companies relates to acquiring customers at low cost. We seek to bundleour marketing efforts through our brand, our portal, NewTracker®, our web presence as Your Business Solutions Company® and one easy entry point ofcontact. We expect that this approach will allow us to continue to cross-sell the financing services of our business finance platform to our customers andcustomers of our controlled portfolio companies, and to build upon our extensive deal sourcing infrastructure.ScreeningWe screen all potential debt or equity investment proposals that we receive for suitability and consistency with our investment criteria (see “PortfolioCompany Characteristics,” above). In screening potential investments, our Senior Lending Team and our Executive Committee utilize a value-orientedinvestment philosophy and commit resources to managing downside exposure. If a potential investment meets our basic investment criteria, a businessservice specialist or other member of our team is assigned to perform preliminary due diligence.SBA Lending ProceduresWe originate loans under the SBA 7(a) Program in accordance with our credit and underwriting policy, which incorporates by reference the SBA Rules andRegulations as they relate to the financing of such loans, including the U.S. Small Business Administration Standard Operating Procedures, Lender andDevelopment Company Loan Program (“SOP 50 10”).During the initial application process for a loan originated under the SBA 7(a) Program, a business service specialist assists and guides the applicant throughthe application process, which begins with the submission of an online form. The online loan processing system collects required information and ensuresthat all necessary forms are provided to the applicant and filled out. The system conducts two early automatic screenings focused primarily on whether (i) therequested loan is for an eligible purpose, (ii) the requested loan is for an eligible amount and (iii) the applicant is an eligible borrower. If the applicant iseligible to fill out the entire application, the online system pre-qualifies the applicant based on preset credit parameters that meet the standards of Newtek andthe SBA.Once the online form and the application materials have been completed, our underwriting department (the “Underwriting Department”) becomes primarilyresponsible for reviewing and analyzing the application in order to accurately assess the level of risk being undertaken in making a loan. The UnderwritingDepartment is responsible for assuring that all information necessary to prudently analyze the risk associated with a loan application has been obtained andhas been analyzed. Credit files are developed and maintained with the documentation received during the application process in such a manner as tofacilitate file review during subsequent developments during the life of the loan.Required InformationFor a loan originated under the SBA 7(a) Program, the primary application document is SBA Form 1919 (Borrower Information Form) (“Form 1919”). Amongother things, Form 1919 requires identifying information about the applicant, loan request, indebtedness, the principals, current or previous governmentfinancing, and certain other disclosures.In addition to Form 1919, the following additional information is required:•an SBA Form 912 (Statement of Personal History), if question 1, 2, or 3 of Form 1919 is answered affirmatively;17Table of Contents•an SBA Form 413 (Personal Financial Statement), for all owners of 20% or more (including the assets of the owner’s spouse and any minor children),and proposed guarantors;•business financial statements dated within 180 days prior to submission to SBA, consisting of (a) year-end balance sheets for the last three years,including detailed debt schedule, (b) year-end profit & loss (P&L) statements for the last three years, (c) reconciliation of net worth, (d) interimbalance sheet, and (e) interim P&L statements;•a list of names and addresses of any subsidiaries and affiliates, including concerns in which the applicant holds a controlling interest and otherconcerns that may be affiliated by stock ownership, franchise, proposed merger or otherwise with the applicant, and business financial statementsmeeting the same requirements as above of such subsidiaries and affiliates;•the applicant’s original business license or certificate of doing business;•records of any loans the applicant may have applied for in the past;•signed personal and business federal income tax returns of the principals of the applicant’s business for previous three years;•personal résumés for each principal;•a brief history of the business and its challenges, including an explanation of why the SBA loan is needed and how it will help the business;•a copy of the applicant’s business lease, or note from the applicant’s landlord, giving terms of proposed lease; and•if purchasing an existing business, (a) current balance sheet and P&L statement of business to be purchased, (b) previous two years federal incometax returns of the business, (c) proposed Bill of Sale including Terms of Sale, and (d) asking price with schedule of inventory, machinery andequipment, furniture and fixtures.We view current financial information as the foundation of sound credit analysis. To that end, we verify all business income tax returns with the InternalRevenue Service and generally request that financial statements be submitted on an annual basis after the loan closes. For business entities or businessguarantors, we request federal income tax returns for each fiscal year-end to meet the prior three-year submission requirement. For interim periods, we willaccept management-prepared financial statements. The most recent financial information may not be more than 180 days old at the time of the approval ofthe loan, but we generally request that the most recent financial information not be older than 90 days in order to provide time for underwriting andsubmission to SBA for guaranty approval. For individuals or personal guarantors, we require a personal financial statement dated within 180 days of theapplication (sixty days is preferred) and personal income tax returns for the prior three years. In connection with each yearly update of business financialinformation, the personal financial information of each principal must also be updated. Spouses are required to sign all personal financial statements in orderfor the Underwriting Department to verify compliance with the SBA’s personal resource test. In addition, the Underwriting Department will ensure that therehas been no adverse impact on financial condition of the applicant or its principals since the approval of the loan. If closing does not occur within ninetydays of the date on which the loan is approved, updated business and personal financial statements must be obtained and any adverse change must beaddressed before the proceeds of the loan may be disbursed. If closing does not occur within six months of the date on which the loan is approved, theapplicant is generally required to reapply for the loan.Stress TestThe standard underwriting process requires a stress test on the applicant’s interest rate to gauge the amount of increase that can be withstood by theapplicant’s cash flow and still provide sufficient cash to service debt. The applicant’s cash flow is tested up to a 2% increase in interest rate. If the applicant’sdebt service coverage ratio decreases to 1:1 or less than 1:1, the loan may only be made as an exception to our Underwriting Guidelines and would requirethe approval of our credit committee.18Table of ContentsRequired Site VisitNo loan will be funded without an authorized representative of Newtek first making a site visit to the business premises. We generally use a contractedvendor to make the required site visit but may from time to time send our own employees to perform this function. Each site visit will generate a narrative ofthe business property as well as photographs of the business property. Additional site visits will be made when a physical on-site inspection is warranted.Credit Assessment of ApplicantLoan requests are assessed primarily based upon an analysis of the character, cash flow, capital, liquidity and collateral involved in the transaction.Character: We require a personal credit report to be obtained on any principal or guarantor involved in a loan transaction. Emphasis is placed upon theimportance of individual credit histories, as this is a primary indicator of an individual’s willingness and ability to repay debt. Any material negative creditinformation must be explained in writing by the principal, and must be attached to the personal credit report in the credit file. No loan will be made where anindividual’s credit history calls into question the repayment ability of the business operation. A loan request from an applicant who has declared bankruptcywithin the ten years preceding the loan application will require special consideration. A thorough review of the facts behind the bankruptcy and impact oncreditors will be undertaken in determining whether the principal has demonstrated the necessary willingness and ability to repay debts. In addition, we willexamine whether the applicant and its principals and guarantors have abided by the laws of their community. Any situation where a serious questionconcerning a principal’s character exists will be reviewed on a case-by-case basis. Unresolved character issues are grounds for declining a loan requestregardless of the applicant’s financial condition or performance.Cash Flow: We recognize that cash flow is the primary and desired source of repayment on any loan, and therefore is the primary focus of the credit decision.Any transaction in which the repayment is not reasonably assured through cash flow will be declined, regardless of other possible credit strengths. At aminimum, combined EBITDA will be used to evaluate repayment ability. Other financial analysis techniques will be employed as needed to establish thereasonableness of repayment. Where repayment is based on past experience, the applicant must demonstrate minimum combined cash flow coverage of 1.2times based upon the most recent fiscal year-end financial statement. A determination of the ability to repay will not be based solely upon interim operatingresults. Where repayment ability is not evident from historical combined earnings (including new businesses and changes of ownership), projections will beanalyzed to determine whether repayment ability is reasonably assured. For changes in ownership, monthly cash flow forecasts will be analyzed to determineadequacy to meet all of the borrower’s needs.For business acquisition applications, the applicant will be required to submit projections and support such projections by detailed assumptions made for allmajor revenue and expense categories and an explanation of how the projections will be met. Analysis must include comparisons with relevant RiskManagement Association (“RMA”) industry averages. EBITDA must be reasonably forecast to exceed debt service requirements by at least 1.2 times, afteraccounting for the initial phase of operations. For change of ownership applications, projections will also be measured against the actual historical financialresults of the seller of the business concern. Projections must demonstrate repayment ability of not less than 1.2 times.Capital: Capital is a strong traditional indicator of the financial health of a business. For going concern entities, the pro-forma leverage position, asmeasured by the debt to tangible net worth ratio, may not exceed the RMA industry median or 4 to 1, whichever is greater. For change of ownershiptransactions, generally 25% of total project costs should be contributed as equity resulting in debt to tangible net worth ratio of 3 to 1.For a change of ownership transaction where a substantial portion of intangibles are included within the transaction, adequacy of capital will be determinedbased upon an evaluation of the business value and level of injection. In determining the legitimacy of the business value, the loan underwriter must utilizetwo SBA approved valuation methods, as outlined in SBA SOP 50 10. If the business value is found to be acceptable, and the equity injection into the projectis within our requirements as outlined herein, then the capital position will be considered satisfactory.As a general rule, shareholder and affiliate loans may be added back to net worth only if such loans will be subordinated for the life of the SBA loan, with noprincipal or interest payments to be made. Financing by the seller of the business may also be considered as equity if the loan will be placed on full standbyfor the life of the SBA loan. Adjustments to net worth to account for the difference between the book value and appraised value of fixed assets may be madeonly when supported by a current appraisal. Appraisals on a “subject to” basis are not acceptable.19Table of ContentsLiquidity: Liquidity, as measured by the current ratio, must be in line with the RMA industry average. An assessment of the adequacy of working capital isrequired. An assessment of the liquidity of a business is essential in determining the ability to meet future obligations. Lending to cash businesses such ashotels and restaurants requires less analysis of the liquidity of the business due to the timing of cash receipts. Industries with large receivables, payables, andinventory accounts require thorough review of the cash cycle of the business and evaluation of the applicant’s ability to manage these accounts. The currentand quick ratios and turnover of receivables, payables and inventory are measured against the RMA industry median in determining the adequacy of theseliquidity measures.Collateral. We are required to reasonably secure each loan transaction with all worthwhile and available assets. Pursuant to SBA SOP 50 10, we may not (andwill not) decline a loan if the only weakness in the application is the value of collateral in relation to the loan amount, provided that all assets available tothe business and its principals have been pledged. As set forth in SBA SOP 50 10, the SBA considers a loan to be fully secured if the lender has taken asecurity interest in all available fixed assets with a combined “net book value” adjusted up to the loan amounts below. For 7(a) loans, “fixed assets” meansreal estate, including land and structures and machinery and equipment owned by the business. “Net book value” is defined as an asset’s original price minusdepreciation and amortization.We attempt to secure each loan transaction with as much real estate and liquid asset collateral as necessary; however, all fixed assets must be evaluated. Fixedassets are evaluated on the basis of the net book value to determine the realizable value among collateral types. Valuation factors are applied as follows:•Commercial real estate — 75%•Residential real estate — 85%•Vacant land — 50%•Machinery & Equipment — 50%•Furniture & Fixtures — 10%•Accounts receivable & inventory — 20%•Leasehold improvements — 5%•Certificate of Deposit — 100%•Regulated Licenses — will vary dependent upon type of license and geographic area. The liquidation rate used must be fully justified.In addition to an assessment of the criteria specified above, there are certain special industry-specific requirements that will be considered in the loanapplication decision.Change of Ownership: The minimum equity injection required in a change of ownership transaction is generally 20% but may be lower for specific industriessuch as medical and dental practices, gas stations and convenience stores, flag hotels and “strong” non-lodging franchises.In the event of financing from the seller of the business, the applicant must inject not less than 10% of the project cost; the seller of the business may providethe balance on a complete standby basis for the life of the SBA loan. Exceptions to the equity requirement are reviewed on a case-by-case basis.For a change of ownership transaction, the application must be accompanied by a business plan including reasonable financial projections. The financialperformance of the seller of the business must be evaluated based upon three years of corporate income tax returns and a current interim financial statement.Projections for the applicant must be in line with the historical financial performance at the business location. In cases where financial performance of theseller of the business is poor, a satisfactory explanation must be provided to detail the circumstances of performance. Projections for the applicant must beaccompanied by detailed assumptions and be supported by information contained in the business plan.Management should have related experience in the industry and demonstrate the ability to successfully operate the business. In the absence of satisfactoryrelated experience, an assessment of management’s experience and capabilities, given the20Table of Contentscomplexity and nature of the business, will be made. In the case of a franchise, we will generally take into account the reputation of a franchisor for providingworthwhile management assistance to its franchisees.We carefully review change of ownership transactions. The loan underwriter will review the contract for sale, which will be included in the credit file. Thecontract for sale must include a complete breakdown of the purchase price, which must be justified through either a third party appraisal or directly by theloan underwriter through an approved valuation method specified in SBA SOP 50 10. The contract of sale must evidence an arm’s length transaction (buttransactions between related parties are permitted so long as they are on an arm’s-length basis) which will preserve the existence of the small business orpromote its sound development. In addition, a satisfactory reason for the sale of the business must be provided. The seller of the business must provide theprior three years of business tax returns and a current interim financial statement, as applicable.Also in connection with a change of ownership transaction, the Loan Processing area of the Underwriting Department will order Uniform Commercial Codesearches on the seller of the existing business. If such a search identifies any adverse information, the Loan Processor will advise the Underwriting Manager orOperations Manager so a prudent decision may be made with respect to the application.Real Estate Transactions: Loan proceeds for the acquisition or refinancing of land or an existing building or for renovation or reconstruction of an existingbuilding must meet the following criteria:•the property must be at least 51% owner-occupied pursuant to SBA policies; and•loan proceeds may not be used to remodel or convert any rental space in the property.Loan proceeds for construction or refinancing of construction of a new building must meet the following criteria:•the property must be at least 60% owner-occupied pursuant to SBA policies; and•if the building is larger than current requirements of the applicant, projections must demonstrate that the applicant will need additional space withinthree years, and will use all of the additional space within ten years.Commercial real estate appraisals are required on all primary collateral prior to the loan closing. In general, appraisals will be required as follows:•for loans up to $100,000 — a formal opinion of value prepared by a real estate professional with knowledge of the local market area;•for loans from $100,000 to $500,000 — a limited summary appraisal completed by a state certified appraiser;•for loans from $500,000 to $1 million — a limited summary appraisal by a Member of the Appraisal Institute (“MAI”) appraiser; and•for loans over $1 million — a complete self-contained appraisal by a MAI appraiser.Environmental screenings and an environmental questionnaire are required for all commercial real estate taken as collateral.In general, environmental reports are required as follows:•for real estate valued up to $500,000 — a transaction screen including a records review;•for real estate valued in excess of $500,000 — a Phase I Environmental Report; and•for the following types of property, a Phase I Environmental Report will be required regardless of property value: gasoline service stations, carwashes, dry cleaners and any other business known to be in environmentally polluting industries.In all cases for commercial real estate taken as collateral:•if further testing is recommended, the recommended level of testing will be performed prior to the loan closing; and21Table of Contents•if the report indicates remedial action to be taken by the business, such actions must be completed prior to the loan closing and a closure letter mustbe provided prior to funding.Medical Professionals: In connection with a loan application relating to the financing of a medical business, all medical licenses will be verified, with theloss or non-renewal of license constituting grounds for denial of the application. In addition, medical professionals must provide evidence of malpracticeliability insurance of at least $2,000,000 or the loan amount, whichever is higher. Malpractice insurance must be maintained for the life of the loan.Franchise Lending: All franchise loan applications will be evaluated as to eligibility by accessing SBA’s Franchise Registry. If the franchise is listed in theregistry and the current franchise agreement is the same as the agreement listed in the registry, Newtek will not review the franchise agreement. However, thefranchise agreement will be reviewed for eligibility by the loan underwriter when either of the following applies: (i) the franchise is not listed on the SBA’sFranchise Registry or (ii) the franchise is on the registry, but the franchisor has not provided a “Certification of No Change on Behalf of a RegisteredFranchisor” or a “Certification of Changes on Behalf of a Registered Franchisor.”Credit PackageFor each loan application, the loan underwriter will prepare a credit package (the “Credit Package”). All credit and collateral issues are addressed in theCredit Package, including but not limited to, the terms and conditions of the loan request, use of proceeds, collateral adequacy, financial condition of theapplicant and business, management strength, repayment ability and conditions precedent. The Underwriting Department will recommend approval, denial ormodification of the loan application. The Credit Package is submitted to our credit committee for further review and final decision regarding the loanapplication.Other than rejections for ineligibility of the applicant, the type of business or the loan purpose, NSBF may decline a loan application for the followingreasons:•after taking into consideration prior liens and considered along with other credit factors, the net value of the collateral offered as security is notsufficient to protect the interest of the U.S. Government;•lack of reasonable assurance of ability to repay loan (and other obligations) from earnings;•lack of reasonable assurance that the business can be operated at a rate of profit sufficient to repay the loan (and other obligations) from earnings;•disproportion of loan requested and of debts to tangible net worth before and after the loan;•inadequate working capital after the disbursement of the loan;•the result of granting the financial assistance requested would be to replenish funds distributed to the owners, partners, or shareholders;•lack of satisfactory evidence that the funds required are not obtainable without undue hardship through utilization of personal credit or resources ofthe owner, partners or shareholders;•the major portion of the loan requested would be to refinance existing indebtedness presently financed through normal lending channels;•credit commensurate with applicant’s tangible net worth is already being provided on terms considered reasonable;•gross disproportion between owner’s actual investment and the loan requested;•lack of reasonable assurance that applicant will comply with the terms of the loan agreement;•unsatisfactory experience on an existing loan; or•economic or physical injury not substantiated.If a loan application is accepted, we will issue a commitment letter to the applicant. After approval, the SBA and NSBF enter into a Loan AuthorizationAgreement which sets forth the terms and conditions for the SBA’s guaranty on the loan. The closing22Table of Contentsof a loan is handled by an internal attorney, whose primary responsibility is closing the loan in accordance with the related Loan Authorization in a mannerconsistent with prudent commercial loan closing procedures, to ensure that the SBA will not repudiate its guaranty due to ineligibility, noncompliance withSBA Rules and Regulations or defective documentation. Before loan proceeds are disbursed, the closing attorney will verify the applicant’s required capitalinjection, ensure that proceeds are being used for a permitted purpose and ensure that other requirements of the Loan Authorization Agreement (including,but not limited to, required insurance and lien positions and environmental considerations) and SBA Rules and Regulations (including the use of proper SBAforms) have been met.Maintenance of Credit FilesA credit file is developed on each borrowing account. Credit files, in either hard copy format or electronic copy, are maintained by the UnderwritingDepartment and organized according to a specified format. The file contains all documentation necessary to show: (a) the basis of the loan, (b) purpose,compliance with policy, conditions, rate, terms of repayment, collateral, and (c) the authority for granting the loan. The credit file is subject to review or auditby the SBA at any time. Upon final action being taken on a loan application, information necessary for closing and servicing will be copied and maintained,while information not considered necessary will be transferred to off-site storage. Once a loan has been disbursed in full, credit files containing alldocumentation will be transferred to the file room or other electronic storage media and maintained under the authority of the administration staff. Anyindividual needing an existing credit file must obtain it from the administration staff member having responsibility for safeguarding all credit files or accessit by a prearranged electronic file process. Removal of any information from the file will compromise the credit file and is prohibited.Other, Primarily Equity InvestmentsDue Diligence and UnderwritingIn making loans or equity investments other than SBA 7(a) loans or similar conventional loans to SMBs, our Executive Committee will take a direct role inscreening potential loans or investments, in supervising the due diligence process, in the preparation of deal documentation and the completion of thetransactions. The members of the Executive Committee complete due diligence and analyze the relationships among the prospective portfolio company’sbusiness plan, operations and expected financial performance. Due diligence may address some or all of the following depending on the size and nature ofthe proposed investment:•on-site visits with management and relevant key employees;•in-depth review of historical and projected financial statements, including covenant calculation work sheets;•interviews with customers and suppliers;•management background checks;•review reports by third-party accountants, outside counsel and other industry, operational or financial experts; and/or•review material contracts.During the underwriting process, significant, ongoing attention is devoted to sensitivity analyses regarding whether a company might bear a significant“downside” case and remain profitable and in compliance with assumed financial covenants. These “downside” scenarios typically involve assumptionsregarding the loss of key customers and/or suppliers, an economic downturn, adverse regulatory changes and other relevant stressors that we attempt tosimulate in our quantitative and qualitative analyses. Further, we continually examine the effect of these scenarios on financial ratios and other metrics.Approval, Documentation and ClosingUpon the completion of the due diligence process, the Executive Committee will review the results and determine if the transaction should proceed toapproval. If approved by our Senior Lending Team and Executive Committee, the underwriting professionals heretofore involved proceed to documentation.As and to the extent necessary, key documentation challenges are brought before our Senior Lending Team and Executive Committee for prompt discussionand resolution. Upon the completion of satisfactory documentation and the satisfaction of closing conditions, final approval is sought from our ExecutiveCommittee before closing and funding.23Table of ContentsOngoing Relationships with Portfolio CompaniesMonitoring, Managerial AssistanceWe have and will continue to monitor our portfolio companies on an ongoing basis. We monitor the financial trends of each portfolio company to determineif it is meeting its business plan and to assess the appropriate course of action for each company. We generally require our portfolio companies to provideannual audits, quarterly unaudited financial statements with management discussion and analysis and covenant compliance certificates, and monthlyunaudited financial statements. Using these monthly financial statements, we calculate and evaluate all financial covenants and additional financialcoverage ratios that might not be part of our covenant package in the loan documents. For purposes of analyzing a portfolio company’s financialperformance, we sometimes adjust their financial statements to reflect pro-forma results in the event of a recent change of control, sale, acquisition oranticipated cost savings. Additionally, we believe that, through our integrated marketing and sale of each service line of NSBF and our controlled portfoliocompanies to our controlled portfolio companies (including electronic payment processing services through NMS and Premier, technology solutions throughNTS, insurance solutions through NIA and payroll and benefits services through NPS) and non-affiliate portfolio companies, we have in place extensive androbust monitoring capabilities.We have several methods of evaluating and monitoring the performance and fair value of our investments, including the following:•assessment of success in adhering to each portfolio company’s business plan and compliance with covenants;•periodic and regular contact with portfolio company management to discuss financial position, requirements and accomplishments;•comparisons to our other portfolio companies in the industry, if any;•attendance at and participation in board meetings; and/or•review of monthly and quarterly financial statements and financial projections for portfolio companies.As part of our valuation procedures, we risk rate all of our investments including loans. In general, our rating system uses a scale of 1 to 8, with 1 being thelowest probability of default and principal loss. Our internal rating is not an exact system, but is used internally to estimate the probability of: (i) default onour debt securities and (ii) loss of our debt or investment principal, in the event of a default. In general, our internal rating system may also assist ourvaluation team in its determination of the estimated fair value of equity securities or equity-like securities. Our internal risk rating system generallyencompasses both qualitative and quantitative aspects of our portfolio companies.Our internal loan and investment risk rating system incorporates the following eight categories:24Table of ContentsRating Summary Description1 Acceptable — Highest Quality — Loans or investments that exhibit strong financial condition and repayment capacity supported byadequate financial information. Generally, as loans these credits are well secured by marketable collateral. These credits are current and havenot demonstrated a history of late-pay or delinquency. There are no or few credit administration weaknesses. This score represents acombination of a strong acceptable credit and adequate or better credit administration. Newly underwritten loans or investments may berated in this category if they clearly possess above-average attributes in all of the above areas. In general, as investments these credits areperforming within our internal expectations, and potential risks to the applicable investment are considered to be neutral or favorablecompared to any potential risks at the time of the original investment.2 Acceptable — Average Quality — These loans or investments are supported by financial condition and repayment strengths that offsetmarginal weaknesses. Generally, as loans these credits are secured but may be less than fully secured. These loans are current or less than 30days past due and may or may not have a history of late payments. They may contain non-material credit administration weaknesses or errorsin verifying that do not put the guaranty at risk or cause wrong or poor credit decisions to be made. This risk rating should also be used toassign an initial risk rating to loans or investments that are recommended for approval by underwriting. Without a performance historyand/or identified credit administration deficiencies, emphasis should be placed on meeting or exceeding underwriting standards collateralprotection, industry experience, and guarantor strength. It is expected that most of our underwritten loans will be of this quality.3 Acceptable — Below Average — These loans or investments are the low-end range of acceptable. Loans would be less than fully securedand probably have a history of late pay and/or delinquency, though not severe. They contain one or more credit administration weaknessesthat do not put the guaranty at risk or cause wrong or poor credit decisions to be made. This risk rating may also be used to identify newloans or investments that may not meet or exceed all underwriting standards, but are approved because of offsetting strengths in other areas.These credits, while of acceptable quality, typically do not possess the same strengths as those in the 1 or 2 categories. In general, theinvestment may be performing below internal expectations and quantitative or qualitative risks may have increased materially since the dateof the investment.4 Other Assets Especially Mentioned (OAEM or Special Mention) — Strong — These loans or investments are currently protected by soundworth and cash flow or other paying capacity, but exhibit a potentially higher risk situation than acceptable credits. While there is an undueor unwarranted credit risk, it is not yet to the point of justifying a substandard classification. Generally, these loans demonstrate somedelinquency history and contain credit administration weaknesses. Performance may show signs of slippage, but can still be corrected. Creditdoes not require a specific allowance at this point but a risk of loss is present.5 Substandard — Workout — These assets contain well defined weaknesses and are inadequately protected by the current sound worth andpaying capacity of the borrower. Generally, loan collateral protects to a significant extent. There is a possibility of loss if the deficiencies arenot corrected and secondary sources may have to be used to repay credit. Credit administration can range from very good to adequateindicating one or more oversights, errors, or omissions which are considered significant but not seriously misleading or causing an error inthe loan decision. Performance has slipped and there are well-defined weaknesses. A specific allowance is in order or risk of loss is present.6 Substandard — Liquidation — These assets contain well defined weaknesses and are inadequately protected by the current sound worthand paying capacity of the borrower or investee. In addition, the weaknesses are so severe that resurrection of the credit is unlikely. For loans,secondary sources will have to be used for repayment. Credits in this category would be severely stressed, nonperforming, and the businessmay be non-viable. There could be character and significant credit administration issues as well. A specific allowance should be establishedor the lack of one clearly justified.7 Doubtful — This classification contains all of the weaknesses inherent in a substandard classification but with the added characteristic thatthe weaknesses make collection or repayment of principal in full, on the basis of existing facts, conditions and values, highly questionableand improbable. The probability of loss is very high, but the exact amount may not be estimable at the current point in time. Loans in thiscategory are severely stressed, generally non-performing and/or involve a non-viable operation. Collateral may be difficult to value becauseof limited salability, no ready and available market, or unknown location or condition of the collateral. Credit administration weaknessescan range from few to severe and may jeopardize the credit as well as the guaranty. All such loans or investments should have a specificallowance.8 Loss — Loans or investments classified as loss are considered uncollectible and of such little value that their continuance as bankable assetsis no longer warranted. This classification does not mean that the credit has no recovery or salvage value but, rather, it is not practical todefer writing off this asset. It is also possible that the credit decision cannot be supported by the credit administration process. Documentsand verification are lacking; analysis is poor or undocumented, there is no assurance that the loan is eligible or that a correct credit decisionwas made. Loss loans are loans where a loss total can be clearly estimated. Losses should be taken during the period in which they areidentified.We will monitor and, when appropriate, change the investment ratings assigned to each loan or investment in our portfolio. In connection with our valuationprocess, our management will review these investment ratings on a quarterly basis, and our25Table of ContentsBoard will affirm such ratings. The investment rating of a particular investment should not, however, be deemed to be a guarantee of the investment’s futureperformance.Historically, we have provided significant operating and managerial assistance to our portfolio companies and our controlled portfolio companies. As a BDC,we will continue to offer, and must provide upon request, managerial assistance to our portfolio companies. This assistance will typically involve, amongother things, monitoring the operations and financial performance of our portfolio companies, participating in board and management meetings, consultingwith and advising officers of portfolio companies and providing other organizational and financial assistance. We may sometimes receive fees for theseservices.Valuation ProceduresWe conduct the valuation of our assets, pursuant to which our net asset value shall be determined, at all times consistent with GAAP and the 1940 Act. Ourvaluation procedures are set forth in more detail below:Securities for which market quotations are readily available on an exchange shall be valued at such price as of the closing price on the day of valuation. Wemay also obtain quotes with respect to certain of our investments from pricing services or brokers or dealers in order to value assets. When doing so, we willdetermine whether the quote obtained is sufficient according to GAAP to determine the fair value of the security. If determined adequate, we will use thequote obtained. We also employ independent third party valuation firms for certain of our investments for which there is not a readily available market value.Securities for which reliable market quotations are not readily available or for which the pricing source does not provide a valuation or methodology orprovides a valuation or methodology that, in the judgment of our Board, does not represent fair value, which we expect will represent a substantial majorityof the investments in our portfolio, shall be valued as follows: (i) each portfolio company or investment is initially valued by the investment professionalsresponsible for the portfolio investment; (ii) preliminary valuation conclusions are documented and discussed with our Senior Lending Team and ExecutiveCommittee; (iii) independent third-party valuation firms engaged by, or on behalf of, the Board will conduct independent appraisals, review management’spreliminary valuations and prepare separate preliminary valuation conclusions on a selected basis; (iv) the Board reviews the preliminary valuations ofmembers of our Senior Lending Team and Executive Committee and/or that of the third party valuation firm and responds to the valuation recommendationwith comments, if any; and (v) the Board will discuss valuations and determine the fair value of each investment in our portfolio in good faith.Determination of fair value involves subjective judgments and estimates not susceptible to substantiation by auditing procedures. Accordingly, under currentauditing standards, the notes to our financial statements will refer to the uncertainty with respect to the possible effect of such valuations, and any change insuch valuations, on our financial statements.The determination of fair value will generally be based on the following factors, as relevant:•the nature and realizable value of any collateral;•adherence to the portfolio company’s business plan and compliance with covenants;•periodic and regular contact with the portfolio company’s management to discuss financial position, requirements and accomplishments;•comparison to portfolio companies in the same industry, if any;•the portfolio company’s ability to make payments;•the portfolio company’s earnings and discounted cash flow;•the markets in which the portfolio company does business; and•comparisons to publicly traded securities.Securities for which market quotations are not readily available or for which a pricing source is not sufficient may include, but are not limited to, thefollowing:•private placements and restricted securities that do not have an active trading market;26Table of Contents•securities whose trading has been suspended or for which market quotes are no longer available;•debt securities that have recently gone into default and for which there is no current market;•securities whose prices are stale;•securities affected by significant events; and•securities that our investment professionals believe were priced incorrectly.CompetitionWe compete for SBA 7(a) and other SMB loans with other financial institutions and various SMB lenders, as well as other sources of funding. Additionally,competition for investment opportunities has emerged among alternative investment vehicles, such as collateralized loan obligations, some of which aresponsored by other alternative asset investors, as these entities have begun to focus on making investments in SMBs. As a result of these new entrants,competition for our investment opportunities may intensify. Many of these entities have greater financial and managerial resources than we do but we believethat they invariably lack the ability to process loans as quickly as we can and do not have the depth of our customer service capabilities. We believe we willbe able to compete with these entities primarily on the basis of our financial technology infrastructure, our experience and reputation, our deep industryknowledge and ability to provide customized business solutions, our willingness to make smaller investments than other specialty finance companies, thebreadth of our contacts, our responsive and efficient investment analysis and decision-making processes, and the investment terms we offer.We and our controlled portfolio companies compete in a large number of markets for the sale of financial and other services to SMBs. Each of our controlledportfolio companies competes not only against suppliers in its particular state or region of the country but also against suppliers operating on a national oreven a multi-national scale. None of the markets in which our controlled portfolio companies compete are dominated by a small number of companies thatcould materially alter the terms of the competition.Our electronic payment processing portfolio companies compete with entities including Global Payments, First National Bank of Omaha and Paymentech,L.P. Our managed technology solutions portfolio company competes with 1&1, Hosting.com, Discount ASP, Maxum ASP, GoDaddy®, Yahoo!®, BlueHost®,iPowerWeb® and Microsoft Live among others.Our business finance platform competes with regional and national banks and non-bank lenders. Intuit® is bundling electronic payment processing, webhosting and payroll services similar to ours in offerings that compete in the same SMB market.In many cases, we believe that our competitors are not as able as we are to take advantage of changes in business practices due to technological developmentsand, for those with a larger size, are unable to offer the personalized service that many SMB owners and operators desire.While we compete with many different providers in our various businesses, we have been unable to identify any direct and comprehensive competitors thatdeliver the same broad suite of services focused on the needs of the SMB market with the same marketing strategy as we do. We believe that some of thecompetitive advantages of our platform include:•compatible products such as our e-commerce offerings that we are able to bundle to increase sales, reduce costs and reduce risks for our customersand enable us to sell two, three, or four products at the same time;•the patented NewTracker® referral system, which allows us and our portfolio companies to process new business utilizing a web-based, centralizedprocessing point and provides back end scalability, and allows our alliance partners to offer a centralized access point for their SMB clients as partof their larger strategic approach to marketing, thus demonstrating their focus on providing a suite of services to the SMB market in addition to theircore service;•the focus on developing and marketing business solutions and financial products and services aimed at the SMB market;•scalability, which allows us to size our business solutions capabilities very quickly to meet customer and market needs;27Table of Contents•the ability to offer personalized service and competitive rates;•a strategy of multiple channel distribution, which gives us maximum exposure in the marketplace;•high quality customer service 24/7/365 across all business lines, with a focus primarily on absolute customer service and;•a telephonic interview process, as opposed to requiring handwritten or data-typing processes, which allows us to offer high levels of customerservice and satisfaction, particularly for SMB owners who do not get this service from our competitorsRevenues by Geographic AreaDuring the years ended December 31, 2017, 2016 and 2015, all of our revenue was derived from customers in the United States.EmployeesAs of December 31, 2017, we had a total of 162 employees.Available InformationWe are subject to the informational requirements of the SEC and in accordance with those requirements file reports, proxy statements and other informationwith the SEC. You may read and copy the reports, proxy statements and other information that we file with the SEC under the informational requirements ofthe Securities Exchange Act at the SEC’s Public Reference Room at 450 Fifth Street N.W., Washington, DC 20549. Please call 1-800-SEC-0330 forinformation about the SEC’s Public Reference Room. The SEC also maintains a web site that contains reports, proxy and information statements and otherinformation regarding registrants that file electronically with the SEC. The address of the SEC’s web site is http://www.sec.gov. Our principal offices arelocated at 1981 Marcus Avenue, Suite 130, Lake Success, NY 11042 and our telephone number is (212) 356-9500. Our website may be directly accessed athttp://www.newtekone.com. We make available through our website, free of charge, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q,Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, asamended, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. These documents may be directly accessedat http://investor.newtekbusinessservices.com. Information contained on our website is not a part of this report.SBICWe may apply for an SBIC license from the SBA if we believe that it will further our investment strategy and enhance our returns. If this application isapproved, our SBIC subsidiary would be a wholly-owned subsidiary and able to rely on an exclusion from the definition of “investment company” under the1940 Act. Our SBIC subsidiary would have an investment objective substantially similar to ours and would be able to make similar types of investments inaccordance with SBIC regulations.Regulation We have elected to be regulated as a BDC under the 1940 Act. We have also elected to be treated for tax purposes as a RIC under Subchapter M of the Code.The 1940 Act contains prohibitions and restrictions relating to transactions between BDCs and their affiliates (including any investment advisers or sub-advisers), principal underwriters and affiliates of those affiliates or underwriters and requires that a majority of the directors be persons other than “interestedpersons,” as that term is defined in the 1940 Act.In addition, the 1940 Act provides that we may not change the nature of our business so as to cease to be, or to withdraw our election as, a BDC unlessapproved by “a majority of our outstanding voting securities” as defined in the 1940 Act. A majority of the outstanding voting securities of a company isdefined under the 1940 Act as the lesser of: (a) 67% or more of such company’s voting securities present at a meeting if more than 50% of the outstandingvoting securities of such company are present or represented by proxy, or (b) more than 50% of the outstanding voting securities of such company. We do notanticipate any substantial change in the nature of our business.28Table of ContentsWe generally are not able to issue and sell our common stock at a price below net asset value per share. We may, however, issue and sell our common stock,or warrants, options or rights to acquire our common stock, at a price below the then-current net asset value of our common stock if (1) our Board determinesthat such sale is in our best interests and the best interests of our stockholders, and (2) our stockholders have approved our policy and practice of making suchsales within the preceding 12 months. In any such case, the price at which our securities are to be issued and sold may not be less than a price which, in thedetermination of our board of directors, closely approximates the market value of such securities. At our Special Meeting of Stockholders on August 11,2017, our stockholders approved a proposal authorizing us to sell up to 20% of our outstanding common stock at a price below our then-current net assetvalue per share, subject to approval by our board of directors for the offering. The authorization expires on the earlier of August 11, 2018 or the date of our2018 Annual Meeting of Stock holders, which is expected to be held in June 2018.As a BDC, we are required to meet a coverage ratio of the value of total assets to senior securities, which include all of our borrowings and any preferred stockwe may issue in the future, of at least 200%. We may also be prohibited under the 1940 Act from knowingly participating in certain transactions with ouraffiliates without the prior approval of our Board who are not interested persons and, in some cases, prior approval by the SEC.We may invest up to 100% of our assets in securities acquired directly from issuers in privately negotiated transactions. With respect to such securities, wemay, for the purpose of public resale, be deemed an “underwriter” as that term is defined in the Securities Act of 1933, or the Securities Act. We do not intendto acquire securities issued by any investment company that exceed the limits imposed by the 1940 Act. Under these limits, except for registered moneymarket funds, we generally cannot acquire more than 3% of the voting stock of any investment company, invest more than 5% of the value of our total assetsin the securities of one investment company or invest more than 10% of the value of our total assets in the securities of more than one investment company.With regard to that portion of our portfolio invested in securities issued by investment companies, it should be noted that such investments might indirectlysubject our stockholders to additional expenses as they will indirectly be responsible for the costs and expenses of such companies. None of our investmentpolicies are fundamental and any may be changed without stockholder approval.Qualifying AssetsUnder the 1940 Act, a BDC may not acquire any asset other than assets of the type listed in Section 55(a) of the 1940 Act, which are referred to as qualifyingassets, unless, at the time the acquisition is made, qualifying assets represent at least 70% of the company’s total assets. The principal categories of qualifyingassets relevant to our proposed business are the following:(1)Securities purchased in transactions not involving any public offering from the issuer of such securities, which issuer (subject to certain limitedexceptions) is an eligible portfolio company, or from any person who is, or has been during the preceding 13 months, an affiliated person of aneligible portfolio company, or from any other person, subject to such rules as may be prescribed by the SEC. An eligible portfolio company isdefined in the 1940 Act as any issuer which:(a) is organized under the laws of, and has its principal place of business in, the United States;(b) is not an investment company (other than a small business investment company wholly owned by the BDC) or a company that would be aninvestment company but for certain exclusions under the 1940 Act: and(c) does not have any class of securities listed on a national securities exchange; or if it has securities listed on a national securities exchange suchcompany has market capitalization of less than $250 million; is controlled by the BDC and has an affiliate of a BDC on its board of directors; ormeets such other criteria as may be established by the SEC.(2)Securities purchased in a private transaction from a U.S. issuer that is not an investment company or from an affiliated person of the issuer, or intransactions incident thereto, if the issuer is in bankruptcy and subject to reorganization or if the issuer, immediately prior to the purchase of itssecurities was unable to meet its obligations as they came due without material assistance other than conventional lending or financingarrangements.(3)Securities of an eligible portfolio company purchased from any person in a private transaction if there is no ready market for such securities and wealready own 60% of the outstanding equity of the eligible portfolio company.29Table of Contents(4)Securities received in exchange for or distributed on or with respect to securities described in (1) through (3) above, or pursuant to the exercise ofwarrants or rights relating to such securities.(5)Cash, cash equivalents, U.S. government securities or high-quality debt securities maturing in one year or less from the time of investment.Control, as defined by the 1940 Act, is presumed to exist where a BDC beneficially owns more than 25% of the outstanding voting securities of the portfoliocompany.We do not intend to acquire securities issued by any investment company that exceed the limits imposed by the 1940 Act. Under these limits, we generallycannot acquire more than 3% of the voting stock of any investment company (as defined in the 1940 Act), invest more than 5% of the value of our total assetsin the securities of one such investment company or invest more than 10% of the value of our total assets in the securities of such investment companies inthe aggregate. With regard to that portion of our portfolio invested in securities issued by investment companies, it should be noted that such investmentsmight subject our stockholders to additional expenses. None of our investment policies are fundamental and any may be changed without stockholderapproval.Regulation as a Small Business Lending CompanyNSBF is licensed by the SBA as an SBLC that originates loans through the SBA 7(a) Program. The SBA 7(a) Program is the SBA’s primary loan program. Inorder to operate as a SBLC, a licensee is required to maintain a minimum regulatory capital (as defined by SBA regulations) of the greater of (1) 10% of itsoutstanding loans receivable and other investments or (2) $1,000,000. In addition, a SBLC is subject to certain other regulatory restrictions.The SBA generally reduces risks to lenders by guaranteeing major portions of qualified loans made to small businesses. This enables lenders to providefinancing to small businesses when funding may otherwise be unavailable or not available on reasonable terms. Under the SBA 7(a) Program, the SBAtypically guarantees 75% of qualified loans over $150,000. The eligibility requirements of the SBA 7(a) Program vary by the industry of the borrower andaffiliates and other factors.Under current law, SBA 7(a) lenders must share equally with the SBA any SBA 7(a) loan premium in excess of 110% of the par value of such loans.Legislation pending in the U.S. Senate would, among other things, require SBA 7(a) lenders to share equally with the SBA any SBA 7(a) loan premium inexcess of 108% of the par value of such loans, thereby decreasing the share of loan premium received by the SBA 7(a) lender. Such legislation also wouldimpose a new fee of 3 basis points on the guaranteed portion of the SBA 7(a) loan. If passed in its present form, the legislation could serve to negativelyimpact the profitability of SBA 7(a) loans.The SBA maintains PLP status to certain lenders originating SBA 7(a) Program loans based on achievement of certain standards in lending which areregularly monitored by the SBA. NSBF has been granted national PLP status and originates, sells and services small business loans. As a Preferred Lender,NSBF is authorized to place SBA guarantees on loans without seeking prior SBA review and approval. Designated PLP lenders are delegated the authority toprocess, close, service, and liquidate most SBA guaranteed loans without prior SBA review. PLP lenders are authorized to make SBA guaranteed loans,subject only to a brief eligibility review and assignment of a loan number by SBA. In addition, they are expected to handle servicing and liquidation of all oftheir SBA loans with limited involvement of SBA.Among other things, SBLCs are required to: submit to the SBA for review a credit policy that demonstrates the SBLC’s compliance with the applicableregulations and the SBA’s Standard Operating Procedures for origination, servicing and liquidation of 7(a) loans; submit to the SBA for review and approvalannual validation, with supporting documentation and methodologies, demonstrating that any scoring model used by the SBLC is predictive of loanperformance; obtain SBA approval for loan securitization and borrowings; and adopt and fully implement an internal control policy which provides adequatedirection for effective control over and accountability for operations, programs, and resources.Pursuant to the SBA’s regulations, the SBA is released from liability on its guaranty of a 7(a) loan and may, in its sole discretion, refuse to honor a guarantypurchase request in full or in part, or recover all or part of the funds already paid in connection with a guaranty purchase, if the lender failed to complymaterially with a program requirement; failed to make, close, service or liquidate the loan in a prudent manner; placed the SBA at risk through improperaction or inaction; failed to disclose a material fact to the SBA in a timely manner; or misrepresented a material fact to the SBA regarding the loan. In certaininstances, the SBA may require a specific dollar amount be deducted from the funds the SBA pays on the lender’s guaranty in order to fully compensate for anactual or anticipated loss caused by the lender’s actions or omissions. Such repair does not reduce the percent of the loan guaranteed by SBA or SBA’s pro-rata share of expenses or recoveries.30Table of ContentsThe SBA restricts the ability of an SBLC to lend money to any of its officers, directors and employees or to invest in associates thereof. The SBA alsoprohibits, without prior SBA approval, a “change of control” of an SBLC. A “change of control” is any event which would result in the transfer of the power,direct or indirect, to direct the management and policies of a SBLC, whether through ownership, contractual arrangements or otherwise. SBLCs areperiodically examined and audited by the SBA to determine compliance with SBA regulations.In connection with our most recent examination by the SBA, we entered into a voluntary agreement with the SBA. We have adopted the agreement pursuantto our commitment to operate under the SBA’s regulations and the agreement formalizes many of the actions we have already taken to strengthen ouroperational procedures as they relate to our delegated lender authorities. Consistent with the terms of the agreement, we will expand NSBF’s board ofmanagers and increase the number of independent members of the board, add at least one additional voting member to NSBF’s Credit Committee and takecertain actions to demonstrate the sufficiency of NSBF’s liquidity. We also provided an account to bolster our liquidity position at NSBF. In relation to therapid growth of our 7(a) loan portfolio, we continue to assess and develop our policies and procedures to facilitate the successful implementation of ourbusiness, liquidity and operations.Significant Managerial AssistanceA BDC must have been organized and have its principal place of business in the United States and must be operated for the purpose of making investments inthe types of securities described in “Qualifying Assets” above. Business development companies generally must offer to make available to the issuer of thesecurities significant managerial assistance, except in circumstances where either (i) the business development company controls such issuer of securities or(ii) the business development company purchases such securities in conjunction with one or more other persons acting together and one of the other personsin the group makes available such managerial assistance. Making available managerial assistance means, among other things, any arrangement whereby theBDC, through its directors, officers or employees, offers to provide, and, if accepted, does so provide, significant guidance and counsel concerning themanagement, operations or business objectives and policies of a portfolio company.Temporary InvestmentsPending investment in other types of “qualifying assets,” as described above, our investments may consist of cash, cash equivalents, U.S. governmentsecurities or high-quality debt securities maturing in one year or less from the time of investment, which we refer to, collectively, as temporary investments,so that 70% of our assets are qualifying assets. Typically, we invest in highly rated commercial paper, U.S. Government agency notes, U.S. Treasury bills or inrepurchase agreements relating to such securities that are fully collateralized by cash or securities issued by the U.S. government or its agencies. A repurchaseagreement involves the purchase by an investor, such as us, of a specified security and the simultaneous agreement by the seller to repurchase it at an agreed-upon future date and at a price which is greater than the purchase price by an amount that reflects an agreed-upon interest rate. Consequently, repurchaseagreements are functionally similar to loans. There is no percentage restriction on the proportion of our assets that may be invested in such repurchaseagreements. However, the 1940 Act and certain diversification tests in order to qualify as a RIC for federal income tax purposes typically require us to limitthe amount we invest with any one counterparty. Our investment Advisor monitors the creditworthiness of the counterparties with which we enter intorepurchase agreement transactions.Warrants and OptionsUnder the 1940 Act, a BDC is subject to restrictions on the amount of warrants, options, restricted stock or rights to purchase shares of capital stock that itmay have outstanding at any time. Under the 1940 Act, we may generally only offer warrants provided that (i) the warrants expire by their terms within tenyears, (ii) the exercise or conversion price is not less than the current market value at the date of issuance, (iii) our stockholders authorize the proposal to issuesuch warrants, and our board of directors approves such issuance on the basis that the issuance is in the best interests of the Company and its stockholders and(iv) if the warrants are accompanied by other securities, the warrants are not separately transferable unless no class of such warrants and the securitiesaccompanying them has been publicly distributed. The 1940 Act also provides that the amount of our voting securities that would result from the exercise ofall outstanding warrants, as well as options and rights, at the time of issuance may not exceed 25% of our outstanding voting securities. In particular, theamount of capital stock that would result from the conversion or exercise of all outstanding warrants, options or rights to purchase capital stock cannotexceed 25% of the BDC’s total outstanding shares of capital stock.31Table of ContentsSenior Securities; Coverage RatioWe are permitted, under specified conditions, to issue multiple classes of indebtedness and one class of stock senior to our common stock if our assetcoverage, as defined in the 1940 Act, is at least equal to 200% immediately after each such issuance. In addition, we may not be permitted to declare any cashdividend or other distribution on our outstanding common shares, or purchase any such shares, unless, at the time of such declaration or purchase, we haveasset coverage of at least 200% after deducting the amount of such dividend, distribution, or purchase price. We may also borrow amounts up to 5% of thevalue of our total assets for temporary purposes. For a discussion of the risks associated with the resulting leverage, see “Risk Factors — Risks Related to OurBusiness And Structure — Because we borrow money, the potential for loss on amounts invested in us is magnified and may increase the risk of investing inus.” For a discussion of the risks associated with the resulting leverage, see “Risk Factors — Risks Related to Our Business Structure — Because we borrowmoney, the potential for loss on amounts invested in us is magnified and may increase the risk of investing in us.”Issuance of Shares Below Current Net Asset ValueAt a Special Meeting of Stockholders on August 11, 2017, our common stockholders approved a proposal that allows us to issue common stock at a discountfrom our NAV per share, effective for a period expiring on the earlier of August 11, 2018 or the 2018 annual meeting of our stockholders. We have agreed tolimit the number of shares that we issue at a price below NAV pursuant to this authorization so that the aggregate dilutive effect on our then outstandingshares will not exceed 20%. Our Board, subject to its fiduciary duties and regulatory requirements, has the discretion to determine the amount of the discount,and as a result, the discount could be up to 100% of net asset value per share. During the year ended December 31, 2017, the Company did not sell any sharesof common stock at a price below NAV per share.Code of EthicsWe have adopted a code of ethics pursuant to Rule 17j-1 under the 1940 Act that establishes procedures for personal investments and restricts certaintransactions by our personnel. Our code of ethics generally does not permit investments by our employees in securities that may be purchased or held by us.You may read and copy our code of ethics at the SEC’s Public Reference Room in Washington, D.C. You may obtain information on the operation of thePublic Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the code of ethics is published and available on the Company’s website athttp://investor.newtekbusinessservices.com/corporate-governance.cfm, is attached as an exhibit and is available on the EDGAR Database on the SEC’sInternet site at www.sec.gov. You may also obtain copies of the code of ethics, after paying a duplicating fee, by electronic request at the following emailaddress: publicinfo@sec.gov, or by writing the SEC’s Public Reference Section, 100 F Street, N.E., Washington, D.C. 20549. Our code of ethics is alsoavailable on our website at www.NewtekOne.com.Compliance Policies and ProceduresWe have adopted and implemented written policies and procedures reasonably designed to detect and prevent violation of the federal securities laws and arerequired to review these compliance policies and procedures annually for their adequacy and the effectiveness of their implementation and designate a chiefcompliance officer to be responsible for administering the policies and procedures. Mr. Michael Schwartz currently serves as our Chief Compliance Officer.Privacy PrinciplesWe are committed to maintaining the privacy of our shareholders and to safeguarding their non-public personal information. The following information isprovided to help you understand what personal information we collect, how we protect that information and why, in certain cases, we may share informationwith select other parties.Generally, we do not receive any non-public personal information relating to our shareholders, although certain non-public personal information of ourshareholders may become available to us. We do not disclose any non-public personal information about our shareholders or former shareholders to anyone,except as permitted by law or as is necessary in order to service shareholder accounts (for example, to a transfer agent or third-party administrator).We willmaintain physical, electronic and procedural safeguards designed to protect the non-public personal information of our shareholders.32Table of ContentsSarbanes-Oxley Act of 2002The Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) imposes a wide variety of regulatory requirements on publicly-held companies and theirinsiders. Many of these requirements affect us. For example:•pursuant to Rule 13a-14 of the 1934 Act, our Chief Executive Officer and Chief Accounting Officer must certify the accuracy of the consolidatedfinancial statements contained in our periodic reports;•pursuant to Item 307 of Regulation S-K, our periodic reports must disclose our conclusions about the effectiveness of our disclosure controls andprocedures;•pursuant to Rule 13a-15 of the 1934 Act, our management must prepare a report regarding its assessment of our internal controls over financialreporting; and•pursuant to Item 308 of Regulation S-K and Rule 13a-15 of the 1934 Act, our periodic reports must disclose whether there were significant changesin our internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including anycorrective actions with regard to significant deficiencies and material weaknesses.The Sarbanes-Oxley Act requires us to review our current policies and procedures to determine whether we comply with the Sarbanes-Oxley Act and theregulations promulgated thereunder. We will continue to monitor our compliance with all regulations that are adopted under the Sarbanes-Oxley Act and willtake actions necessary to ensure that we are in compliance therewith.Proxy Voting Policies and ProceduresWe vote proxies relating to our portfolio securities in a manner in which we believe is in the best interest of our stockholders. We review on a case-by-casebasis each proposal submitted to a stockholder vote to determine its impact on the portfolio securities held by us. Although we generally vote againstproposals that may have a negative impact on our portfolio securities, we may vote for such a proposal if there exists compelling long-term reasons to do so.Our proxy voting decisions are made by our Senior Lending Team and our Executive Committee, which are responsible for monitoring each of ourinvestments. To ensure that our vote is not the product of a conflict of interest, we require that: (i) anyone involved in the decision making process disclose toour chief compliance officer any potential conflict that he or she is aware of and any contact that he or she has had with any interested party regarding aproxy vote; and (ii) employees involved in the decision making process or vote administration are prohibited from revealing how we intend to vote on aproposal in order to reduce any attempted influence from interested parties.Stockholders may obtain information regarding how we voted proxies with respect to our portfolio securities by making a written request for information to:Chief Compliance Officer, 1981 Marcus Avenue, Suite 130, Lake Success, NY 11042.Exemptive ReliefOn May 10, 2016, we received an order from the SEC for exemptive relief that, with the shareholders’ approval we received on July 27, 2016, allows us totake certain actions that would otherwise be prohibited by the 1940 Act, as applicable to BDCs. Specifically, the order permits us to (i) issue restricted stockawards to our officers, employees and employee and non-employee directors, (ii) issue stock options to our employees, (iii) withhold shares of the Company’scommon stock to satisfy tax withholding obligations relating to the vesting of restricted stock or the exercise of options that were granted to pursuant to the2014 Plan or the Amended Stock Plan, and (iv) permit participants to pay the exercise price of Options that were granted to them pursuant to the 2014 Plan orwill be granted to them pursuant to Amended Stock Plan with shares of Applicant’s common stock.OtherWe will be periodically examined by the SEC for compliance with the Exchange Act and the 1940 Act.33Table of ContentsWe are required to provide and maintain a bond issued by a reputable fidelity insurance company to protect us against larceny and embezzlement.Furthermore, as a BDC, we are prohibited from protecting any director or officer against any liability to our stockholders arising from willful misfeasance, badfaith, gross negligence or reckless disregard of the duties involved in the conduct of such person’s office.We are required to adopt and implement written policies and procedures reasonably designed to prevent violation of the federal securities laws, review thesepolicies and procedures annually for their adequacy and the effectiveness of their implementation. We have designated Michael Schwartz to be our ChiefCompliance Officer to be responsible for administering these policies and procedures.Nasdaq Global Market RequirementsWe have adopted certain policies and procedures intended to comply with the Nasdaq Global Market’s corporate governance rules. We will continue tomonitor our compliance with all future listing standards that are approved by the SEC and will take actions necessary to ensure that we are in compliancetherewith.Taxation as a Regulated Investment CompanyFor any taxable year in which we:•qualify as a RIC; and•satisfy the Annual Distribution Requirement,We generally will not be subject to U.S. federal income tax on the portion of our income we distribute (or are deemed to distribute) to stockholders. We willbe subject to U.S. federal income tax at the regular corporate rates on any income or capital gains not distributed (or deemed distributed) to our stockholders.We will be subject to a 4% nondeductible U.S. federal excise tax on certain undistributed income unless we distribute in a timely manner an amount at leastequal to the sum of (1) 98% of our net ordinary income for each calendar year, (2) 98.2% of our capital gain net income for the one-year period endingOctober 31 in that calendar year and (3) any income recognized, but not distributed, in preceding years and on which we paid no corporate-level income tax(the “Excise Tax Avoidance Requirement”). We generally will endeavor in each taxable year to make sufficient distributions to our stockholders to avoidany U.S. federal excise tax on our earnings.In order to qualify as a RIC for U.S. federal income tax purposes, we must, among other things:•continue to qualify as a BDC under the 1940 Act at all times during each taxable year;•derive in each taxable year at least 90% of our gross income from dividends, interest, payments with respect to loans of certain securities, gainsfrom the sale of stock or other securities, net income from certain “qualified publicly traded partnerships,” or other income derived with respect toour business of investing in such stock or securities (the “90% Income Test”); and•diversify our holdings so that at the end of each quarter of the taxable year:•at least 50% of the value of our assets consists of cash, cash equivalents, U.S. Government securities, securities of other RICs, and othersecurities if such other securities of any one issuer do not represent more than 5% of the value of our assets or more than 10% of theoutstanding voting securities of the issuer; and•no more than 25% of the value of our assets is invested in the securities, other than U.S. government securities or securities of other RICs,of one issuer, of two or more issuers that are controlled, as determined under applicable Code rules, by us and that are engaged in the sameor similar or related trades or businesses or of certain “qualified publicly traded partnerships” (the “Diversification Tests”).Qualified earnings may exclude such income as management fees received in connection with our subsidiaries or other potential outside managed funds andcertain other fees.We may be required to recognize taxable income in circumstances in which we do not receive cash. For example, if we hold debt obligations that are treatedunder applicable tax rules as having original issue discount (such as debt instruments with PIK interest or, in certain cases, increasing interest rates or issuedwith warrants), we must include in income each year a portion of the original issue discount that accrues over the life of the obligation, regardless of whethercash representing such income is received by us in the same taxable year. We may also have to include in income other amounts that we have not yetreceived in34Table of Contentscash, such as PIK interest, deferred loan origination fees that are paid after origination of the loan or are paid in non-cash compensation such as warrants orstock, or certain income with respect to equity investments in foreign corporations. Because any original issue discount or other amounts accrued will beincluded in our investment company taxable income for the year of accrual, we may be required to make a distribution to our stockholders in order to satisfythe Annual Distribution Requirement, even though we will not have received any corresponding cash amount. The Company does not currently holdinvestments that have original issue discount.Gain or loss realized by us from the sale or exchange of warrants acquired by us as well as any loss attributable to the lapse of such warrants generally will betreated as capital gain or loss. Such gain or loss generally will be long-term or short-term, depending on how long we held a particular warrant.Although we do not presently expect to do so, we are authorized to borrow funds and to sell assets in order to satisfy the Annual Distribution Requirementand the Excise Tax Avoidance Requirement. However, under the 1940 Act, we are not permitted to make distributions to our stockholders while our debtobligations and other senior securities are outstanding unless certain “asset coverage” tests are met. Moreover, our ability to dispose of assets to meet ourdistribution requirements may be limited by (1) the illiquid nature of our portfolio and/or (2) other requirements relating to our status as a RIC, including theDiversification Tests. If we dispose of assets in order to meet the Annual Distribution Requirement or the Excise Tax Avoidance Requirement, we may makesuch dispositions at times that, from an investment standpoint, are not advantageous. If we are prohibited from making distributions or are unable to obtaincash from other sources to make the distributions, we may fail to qualify as a RIC, which would result in us becoming subject to corporate-level federalincome tax.In addition, we will be partially dependent on our subsidiaries for cash distributions to enable us to meet the RIC distribution requirements. Some of oursubsidiaries may be limited by the Small Business Investment Act of 1958, and SBA regulations, from making certain distributions to us that may benecessary to maintain our status as a RIC. We may have to request a waiver of the SBA’s restrictions for our subsidiaries to make certain distributions tomaintain our RIC status. We cannot assure you that the SBA will grant such waiver. If our subsidiaries are unable to obtain a waiver, compliance with theSBA regulations may cause us to fail to qualify as a RIC, which would result in us becoming subject to corporate-level federal income tax.The remainder of this discussion assumes that we will qualify as a RIC and will have satisfied the Annual Distribution Requirement for the year endedDecember 31, 2017.Any transactions in options, futures contracts, constructive sales, hedging, straddle, conversion or similar transactions, and forward contracts will be subjectto special tax rules, the effect of which may be to accelerate income to us, defer losses, cause adjustments to the holding periods of our investments, convertlong-term capital gains into short-term capital gains, convert short-term capital losses into long-term capital losses or have other tax consequences. Theserules could affect the amount, timing and character of distributions to stockholders. We do not currently intend to engage in these types of transactions.A RIC is limited in its ability to deduct expenses in excess of its “investment company taxable income” (which is, generally, ordinary income plus netrealized short-term capital gains in excess of net realized long-term capital losses). If our expenses in a given year exceed gross taxable income (e.g., as theresult of large amounts of equity-based compensation), we would experience a net operating loss for that year. However, a RIC is not permitted to carryforward net operating losses to subsequent years. In addition, expenses can be used only to offset investment company taxable income, not net capital gain.Due to these limits on the deductibility of expenses, we may for tax purposes have aggregate taxable income for several years that we are required todistribute and that is taxable to our stockholders even if such income is greater than the aggregate net income we actually earned during those years. Suchrequired distributions may be made from our cash assets or by liquidation of investments, if necessary. We may realize gains or losses from such liquidations.In the event we realize net capital gains from such transactions, you may receive a larger capital gain distribution than you would have received in theabsence of such transactions.Investment income received from sources within foreign countries, or capital gains earned by investing in securities of foreign issuers, may be subject toforeign income taxes withheld at the source. In this regard, withholding tax rates in countries with which the United States does not have a tax treaty are oftenas high as 35% or more. The United States has entered into tax treaties with many foreign countries that may entitle us to a reduced rate of tax or exemptionfrom tax on this related income and gains. The effective rate of foreign tax cannot be determined at this time since the amount of our assets to be investedwithin various countries is not now known. We do not anticipate being eligible for the special election that allows a RIC to treat foreign income taxes paidby such RIC as paid by its stockholders.If we purchase shares in a “passive foreign investment company,” or PFIC, we may be subject to U.S. federal income tax on a portion of any “excessdistribution” or gain from the disposition of such shares even if such income is distributed as a taxable35Table of Contentsdividend by us to our stockholders. Additional charges in the nature of interest may be imposed on us in respect of deferred taxes arising from suchdistributions or gains. If we invest in a PFIC and elect to treat the PFIC as a “qualified electing fund” under the Code, or QEF, in lieu of the foregoingrequirements, we will be required to include in income each year a portion of the ordinary earnings and net capital gain of the QEF, even if such income is notdistributed to it. Alternatively, we can elect to mark-to-market at the end of each taxable year our shares in a PFIC; in this case, we will recognize as ordinaryincome any increase in the value of such shares and as ordinary loss any decrease in such value to the extent it does not exceed prior increases included inincome. Under either election, we may be required to recognize in a year income in excess of our distributions from PFICs and our proceeds from dispositionsof PFIC stock during that year, and such income will nevertheless be subject to the Annual Distribution Requirement and will be taken into account forpurposes of the 4% U.S. federal excise tax. In addition, under recently proposed regulations, income required to be included as a result of a QEF electionwould not be qualifying income for purposes of the 90% Income Test unless we receive a distribution of such income from the PFIC in the same taxable yearto which the inclusion relates. We intend to limit and/or manage our holdings in PFICs to minimize our liability for any taxes and related interest charges.Foreign exchange gains and losses realized by us in connection with certain transactions involving non-dollar debt securities, certain foreign currencyfutures contracts, foreign currency option contracts, foreign currency forward contracts, foreign currencies, or payables or receivables denominated in aforeign currency are subject to Code provisions that generally treat such gains and losses as ordinary income and losses and may affect the amount, timingand character of distributions to our stockholders. Any such transactions that are not directly related to our investment in securities (possibly includingspeculative currency positions or currency derivatives not used for hedging purposes) could, under future Treasury regulations, produce income not amongthe types of “qualifying income” from which a RIC must derive at least 90% of its annual gross income.Failure to Qualify as a RIC If we fail to satisfy the 90% Income Test or the Diversification Tests for any taxable year, we may nevertheless continue to qualify as a RIC for such year ifcertain relief provisions are applicable (which may, among other things, require us to pay certain corporate-level federal taxes or to dispose of certain assets). If we were unable to qualify for treatment as a RIC and the foregoing relief provisions are not applicable, we would be subject to tax on all of our taxableincome at regular corporate rates, regardless of whether we make any distributions to our stockholders. Distributions would not be required, and anydistributions would be taxable to our stockholders as ordinary dividend income to the extent of our current and accumulated earnings and profits and, subjectto certain limitations, may be eligible for the 20% maximum rate for non-corporate taxpayers provided certain holding period and other requirements weremet. Subject to certain limitations under the Code, corporate distributees would be eligible for the dividends-received deduction. Distributions in excess ofour current and accumulated earnings and profits would be treated first as a return of capital to the extent of the stockholder’s tax basis, and any remainingdistributions would be treated as a capital gain. Generally, a non-taxable return of capital will reduce an investor’s basis in our stock for federal tax purposes,which will result in higher tax liability when the stock is sold. Stockholders should read any written disclosure accompanying a distribution carefully andshould not assume that the source of any distribution is our ordinary income or gains. Certain written disclosure will present a calculation of return of capitalon a tax accounting basis.If we fail to qualify as a RIC in any taxable year, to requalify as a RIC in a subsequent taxable year, we would be required to satisfy the RIC qualificationrequirements for that year and dispose of any earnings and profits from any year in which we failed to qualify as a RIC. Subject to a limited exceptionapplicable to RICs that qualified as such under Subchapter M of the Code for at least one year prior to disqualification and that requalify as a RIC no laterthan the second year following the non-qualifying year, we could be subject to tax on any unrealized net built-in gains in the assets held by us during theperiod in which we failed to qualify as a RIC that are recognized within the subsequent 5 years, unless we made a special election to pay corporate-level taxon such built-in gain at the time of our requalification as a RIC.ITEM 1A. RISK FACTORSThe following is a summary of the risk factors that we believe are most relevant to our business. These are factors that, individually or in the aggregate, wethink could cause our actual results to differ significantly from anticipated or historical results. If any of the following risks occur, our business, financialcondition and results of operations could be materially and adversely affected. In that case, the value of our common stock could decline and shareholdersmay lose all or part of their investment. You should understand that it is not possible to predict or identify all such factors. Consequently, you should not36Table of Contentsconsider the following to be a complete discussion of all potential risks or uncertainties. We undertake no obligation to publicly update forward-lookingstatements, whether as a result of new information, future events, or otherwise, unless required by law.RISKS RELATED TO OUR BUSINESS AND STRUCTUREThroughout our 20 year history we have never operated as a BDC until we converted on November 12, 2014.Although Newtek has operated since 1998, we have limited operating history as a BDC. As a result, we can offer no assurance that we will achieve ourinvestment objective and that the value of any investment in our Company will not decline substantially. As a BDC, we are subject to the regulatoryrequirements of the SEC, in addition to the specific regulatory requirements applicable to BDCs under the 1940 Act and RICs under the Code. Prior to ourBDC Conversion, our management did not have any prior experience operating under this BDC regulatory framework, and we may incur substantialadditional costs, and expend significant time or other resources, to do so. In addition, we may be unable to generate sufficient revenue from our operations tomake or sustain distributions to our shareholders.Our investment portfolio is recorded at fair value, with our Board having final responsibility for overseeing, reviewing and approving, in good faith, itsestimate of fair value and, as a result, there is uncertainty as to the value of our portfolio investments.Under the 1940 Act, we are required to carry our portfolio investments at market value or, if there is no readily available market value, at fair value asdetermined by us, with our Board having final responsibility for overseeing, reviewing and approving, in good faith, our estimate of fair value. Typically,there is not a public market for the securities of the privately held companies in which we invest. As a result, we value these securities annually and quarterlyat fair value based on various inputs, including management, third-party valuation firms and our audit committee, and with the oversight, review andapproval of our Board.The determination of fair value and consequently, the amount of unrealized gains and losses in our portfolio, are to a certain degree, subjective anddependent on a valuation process approved by our Board. Certain factors that may be considered in determining the fair value of our investments includeexternal events, such as private mergers, sales and acquisitions involving comparable companies. Because such valuations, and particularly valuations ofprivate securities and private companies, are inherently uncertain, they may fluctuate over short periods of time and may be based on estimates. Ourdeterminations of fair value may differ materially from the values that would have been used if a ready market for these securities existed. Due to thisuncertainty, our fair value determinations may cause our net asset value on a given date to materially understate or overstate the value that we may ultimatelyrealize on one or more of our investments. As a result, investors purchasing our common stock based on an overstated net asset value would pay a higherprice than the value of our investments might warrant. Conversely, investors selling stock during a period in which the net asset value understates the valueof our investments will receive a lower price for their stock than the value of our investments might warrant.Any unrealized depreciation we experience in our portfolio may be an indication of future realized losses, which could reduce our income and gainsavailable for distribution.As a BDC, we are required to carry our investments at market value or, if no market value is ascertainable, at the fair value as determined in good faith by ourBoard. Decreases in the market values or fair values of our investments will be recorded as unrealized depreciation. Any unrealized depreciation in ourportfolio could be an indication of a portfolio company's inability to meet its repayment obligations to us with respect to affected loans or a potentialimpairment of the value of affected equity investments. This could result in realized losses in the future and ultimately in reductions of our income and gainsavailable for distribution in future periods.Our financial condition and results of operations will depend on our ability to manage and deploy capital effectively.Our ability to achieve our investment objective will depend on our ability to manage and deploy capital, which will depend, in turn, on our management’sability to identify, evaluate and monitor, and our ability to finance and invest in, companies that meet our investment criteria.Accomplishing our investment objective on a cost-effective basis will largely be a function of our management’s handling of the investment process, itsability to provide competent, attentive and efficient services and our access to investments offering acceptable terms. In addition to monitoring theperformance of our existing investments, our Senior Lending Team and our Executive Committee is called upon, from time to time, to provide managerialassistance to some of our portfolio companies.37Table of ContentsThese demands on their time may distract them or slow the rate of investment. Even if we are able to grow and build upon our investment operations, anyfailure to manage our growth effectively could have a material adverse effect on our business, financial condition, results of operations and prospects. Theresults of our operations will depend on many factors, including the availability of opportunities for investment, readily accessible short and long-termfunding alternatives in the financial markets and economic conditions. Furthermore, if we cannot successfully operate our business or implement ourinvestment policies and strategies as described herein, it could negatively impact our ability to pay dividends.We are dependent upon our Senior Lending Team and our Executive Committee for our future success, and if we are unable to hire and retain qualifiedpersonnel or if we lose any member of our Senior Lending Team or our Executive Committee our ability to achieve our investment objective could besignificantly harmed.We depend on our Senior Lending Team and Executive Committee as well as other key personnel for the identification, final selection, structuring, closingand monitoring of our investments. These executive officers and employees have critical industry experience and relationships that we rely on to implementour business plan. Our future success depends on the continued service of our Senior Lending Team and our Executive Committee and the replacement ofany departing individuals with others of comparable skills and experience. The departure of any of the members of our Senior Lending Team, our ExecutiveCommittee or a significant number of our senior personnel could have a material adverse effect on our ability to achieve our investment objective. As a result,we may not be able to operate our business as we expect, and our ability to compete could be harmed, which could cause our operating results to suffer.We operate in a highly competitive market for investment opportunities, which could reduce returns and result in losses.We compete for investments with other financial institutions and various SMB lenders, as well as other sources of funding. Additionally, competition forinvestment opportunities has emerged among alternative investment vehicles, such as CLOs, some of which are sponsored by other alternative assetinvestors, as these entities have begun to focus on making investments in SMBs. As a result of these new entrants, competition for our investmentopportunities may intensify. Many of our competitors will be substantially larger and have considerably greater financial, technical and marketing resourcesthan us. For example, some competitors may have a lower cost of capital and access to funding sources that will not be available to us. In addition, some ofour competitors may have higher risk tolerances or different risk assessments than we will have. These characteristics could allow our competitors to considera wider variety of investments, establish more relationships and offer better pricing and more flexible structuring than we will be able to offer. We may loseinvestment opportunities if we do not match our competitors’ pricing, terms and structure. If we are forced to match our competitors’ pricing, terms andstructure, we may not be able to achieve acceptable returns on our investments or may bear substantial risk of capital loss. Furthermore, many of ourcompetitors will have greater experience operating under, or will not be subject to, the regulatory restrictions that the 1940 Act will impose on us as a BDC,or the source-of-income, asset diversification, and distribution requirements we must satisfy to maintain our tax treatment as a RIC.If we are unable to source investments effectively, we may be unable to achieve our investment objective.Our ability to achieve our investment objective depends on our Senior Lending Team’s and our Executive Committee’s ability to identify, evaluate andinvest in suitable companies that meet our investment criteria. Accomplishing this result on a cost-effective basis is largely a function of our marketingcapabilities, our management of the investment process, our ability to provide efficient services and our access to financing sources on acceptable terms. Inaddition to monitoring the performance of our existing investments, members of our Senior Lending Team, our Executive Committee and our otherinvestment professionals may also be called upon to provide managerial assistance to our portfolio companies. These demands on their time may distractthem or slow the rate of investment. To grow, we need to continue to hire, train, supervise and manage new employees and to implement computer and othersystems capable of effectively accommodating our growth. However, we cannot provide assurance that any such employees will contribute to the success ofour business or that we will implement such systems effectively. Failure to manage our future growth effectively could have a material adverse effect on ourbusiness, financial condition and results of operations.Our business model depends to a significant extent upon strong referral relationships, and our inability to maintain or further develop these relationships,as well as the failure of these relationships to generate investment opportunities, could adversely affect our business.We expect that members of our Senior Lending Team and our Executive Committee will maintain their relationships with intermediaries, financialinstitutions, investment bankers, commercial bankers, financial advisors, attorneys, accountants, consultants, alliance partners, and other individuals withintheir networks, and we will rely, to a significant extent, upon these38Table of Contentsrelationships to provide us with potential investment opportunities. If our Senior Lending Team and our Executive Committee fail to maintain its existingrelationships or develop new relationships with sources of investment opportunities, we may not be able to grow our investment portfolio. In addition,individuals with whom members of our Senior Lending Team and our Executive Committee have relationships are not obligated to provide us withinvestment opportunities, and, therefore, there is no assurance that such relationships will generate investment opportunities for us.Any failure on our part to maintain our status as a BDC would reduce our operating flexibility.We have elected to be regulated as a BDC under the 1940 Act. The 1940 Act imposes numerous constraints on the operations of BDCs. For example, BDCsare required to invest at least 70% of their gross assets in specified types of securities, primarily in private companies or thinly-traded U.S. public companies,cash, cash equivalents, U.S. government securities and other high quality debt investments that mature in one year or less. Furthermore, any failure to complywith the requirements imposed on BDCs by the 1940 Act could cause the SEC to bring an enforcement action against us and/or expose us to claims of privatelitigants. In addition, upon approval of a majority of our shareholders, we may elect to withdraw our status as a BDC. If we decide to withdraw our election, orif we otherwise fail to maintain our qualification, as a BDC, we may be subject to the substantially greater regulation under the 1940 Act as a closed-endinvestment company. Compliance with such regulations would significantly decrease our operating flexibility, and could significantly increase our costs ofdoing business.Regulations governing our operation as a BDC affect our ability to raise additional capital and the way in which we do so. As a BDC, the necessity ofraising additional capital may expose us to risks, including the typical risks associated with leverage.We may issue debt securities or preferred stock and/or borrow money from banks or other financial institutions, which we refer to collectively as “seniorsecurities,” up to the maximum amount permitted by the 1940 Act. Under the provisions of the 1940 Act, we are permitted, as a BDC, to issue seniorsecurities in amounts such that our asset coverage ratio, as defined in the 1940 Act, equals at least 200% of gross assets less all liabilities and indebtednessnot represented by senior securities, after each issuance of senior securities. If the value of our assets declines, we may be unable to satisfy this test. If thathappens, we may be required to sell a portion of our investments and, depending on the nature of our leverage, repay a portion of our indebtedness at a timewhen such sales may be disadvantageous. Also, any amounts that we use to service our indebtedness would not be available for distributions to our commonshareholders. Continuing to expand our debt financing activities in SBA 7(a) loans will require us to raise additional capital. The failure to continue togenerate such loans on a consistent basis could have a material impact on our results of operations, and accordingly, our ability to make distributions to ourshareholders.We generally may not issue and sell our common stock at a price below net asset value per share. We may, however, sell our common stock, or warrants,options or rights to acquire our common stock, at a price below the then-current net asset value per share of our common stock if our Board determines thatsuch sale is in our best interests and in the best interests of our shareholders, and our shareholders approve such sale. In any such case, the price at which oursecurities are to be issued and sold may not be less than a price that, in the determination of our Board, closely approximates the market value of suchsecurities (less any distributing commission or discount). If we raise additional funds by issuing more common stock or senior securities convertible into, orexchangeable for, our common stock, then the percentage ownership of our shareholders at that time will decrease, and you may experience dilution.Because we intend to distribute substantially all of our income to our shareholders to maintain our tax treatment as a RIC, we will continue to needadditional capital to finance our growth, and regulations governing our operation as a BDC will affect our ability to, and the way in which we, raiseadditional capital and make distributions.As a RIC, we generally are required to distribute substantially all of our ordinary income to meet the Annual Distribution Requirement and the Excise TaxAvoidance Requirement (discussed below), which consequently increases the need to raise additional debt and equity capital. Furthermore, as a result ofissuing senior securities, we would also be exposed to typical risks associated with leverage, including an increased risk of loss. If we issue preferred stock,the preferred stock would rank “senior” to common stock in our capital structure, preferred shareholders would have separate voting rights on certain mattersand might have other rights, preferences, or privileges more favorable than those of our common shareholders, and the issuance of preferred stock could havethe effect of delaying, deferring or preventing a transaction or a change of control that might involve a premium price for holders of our common stock orotherwise be in your best interest.Because we borrow money, the potential for loss on amounts invested in us is magnified and may increase the risk of investing in us.39Table of ContentsBorrowings, also known as leverage, magnify the potential for loss on investments in our indebtedness and on invested equity capital. As we use leverage topartially finance our investments, you will experience increased risks of investing in our securities. If the value of our assets increases, then leveraging wouldcause the net asset value attributable to our common stock to increase more sharply than it would have had we not leveraged. Conversely, if the value of ourassets decreases, leveraging would cause net asset value to decline more sharply than it otherwise would have had we not leveraged our business. Similarly,any increase in our income in excess of interest payable on the borrowed funds would cause our net investment income to increase more than it wouldwithout the leverage, while any decrease in our income would cause net investment income to decline more sharply than it would have had we not borrowed.Such a decline could negatively affect our ability to pay common stock dividends, scheduled debt payments or other payments related to our securities.Leverage is generally considered a speculative investment technique.Illustration: The following table illustrates the effect of leverage on returns from an investment in our common stock assuming various annual returns, net ofexpenses. The calculations in the table below are hypothetical and actual returns may be higher or lower than those appearing in the table below:Assumed Return on Our Portfolio (1)(net of expenses) (10)%(5)%0%5%10%Corresponding net return to shareholders (2)(22.54)%(13.20)%(3.87)%5.47%14.80%(1) Assumes $519,611,000 in total assets, $221,007,000 in debt outstanding, $278,329,000 in net assets as of December 31, 2017, and an average cost offunds of 4.87%. Actual interest payments may be different.(2) In order for us to cover our annual interest payments on indebtedness, we must achieve annual returns on our December 31, 2017 total assets of at least2.07%.Our ability to achieve our investment objective may depend in part on our ability to access additional leverage on favorable terms, and there can be noassurance that such additional leverage can in fact be achieved.To the extent we borrow money to finance our investments, changes in interest rates will affect our cost of capital and net investment income.To the extent we borrow money to finance investments, our net investment income will depend, in part, upon the difference between the rate at which weborrow funds and the rate at which we invest those funds. As a result, we can offer no assurance that a significant change in market interest rates will not havea material adverse effect on our net investment income in the event we borrow money to finance our investments. In periods of rising interest rates, our cost offunds would increase, which could reduce our net investment income. We expect that our long-term fixed-rate investments will be financed primarily withequity and/or long-term debt. We may use interest rate risk management techniques in an effort to limit our exposure to interest rate fluctuations. Suchtechniques may include various interest rate hedging activities to the extent permitted by the 1940 Act. If we do not implement these techniques properly, wecould experience losses on our hedging positions, which could be material. In addition, depending on the frequency and magnitude of rising interest rates,these interest rate increases could negatively impact premiums received on the sale of guaranteed SBA loans, and further, could increase prepayment speedson outstanding SBA loans, potentially negatively impacting the Company’s financial results.We may experience fluctuations in our quarterly and annual results.We may experience fluctuations in our quarterly and annual operating results due to a number of factors, including our ability or inability to makeinvestments in companies that meet our investment criteria, the interest rate payable on the debt securities we acquire, the default rate of such securities, thelevel of portfolio dividend and fee income, the level of our expenses, variations in and the timing of the recognition of realized and unrealized gains orlosses, the degree to which we encounter competition in our markets and general economic conditions. As a result of these factors, results for any periodshould not be relied upon as being indicative of performance in future periods.40Table of ContentsOur Board may change our investment objective, operating policies and strategies without prior notice or shareholder approval, the effects of which maybe adverse.Although we must obtain shareholder approval to cease to be, or withdraw our election as, a BDC, our Board has the authority to modify or waive ourinvestment objective, current operating policies, investment criteria and strategies without prior notice and without shareholder approval. We cannot predictthe effect any changes to our current operating policies, investment criteria and strategies would have on our business, net asset value, operating results andvalue of our stock. However, the effects might be adverse, which could negatively impact our ability to make distributions and cause shareholders to lose allor part of their investment.We will be subject to corporate-level income tax if we are unable to maintain our treatment as a RIC or are unable to make the distributions required tomaintain RIC tax treatment.Although we have elected to be treated as a RIC commencing with our tax year ending December 31, 2015, no assurance can be given that we will be able tomaintain our tax treatment as a RIC in the future. To maintain our tax treatment as a RIC, we must meet certain source-of-income, asset diversification, anddistribution requirements.The income source requirement will be satisfied if we obtain at least 90% of our income for each year from dividends, interest, gains from the sale of stock orsecurities or similar sources.The asset diversification requirement will be satisfied if we meet certain asset diversification requirements at the end of each quarter of our taxable year.Failure to meet those requirements may result in our having to dispose of certain investments quickly in order to prevent the loss of our qualification as aRIC. Because most of our investments will be in private companies, and therefore will be relatively illiquid, any such dispositions could be made atdisadvantageous prices and could result in substantial losses. The Annual Distribution Requirement for a RIC will be satisfied if we distribute to ourshareholders on an annual basis at least 90% of our net ordinary income and net short-term capital gains in excess of our net long-term capital losses, if any.Because we use debt financing, we are subject to certain asset coverage ratio requirements under the 1940 Act and financial covenants under loan and creditagreements that could, under certain circumstances, restrict us from making distributions necessary to satisfy the distribution requirement. If we are unable toobtain cash from other sources, we could fail to qualify for tax treatment as a RIC.If we fail to qualify for RIC tax treatment for any reason and remain or become subject to corporate income tax, the resulting corporate taxes couldsubstantially reduce our net assets, the amount of income available for distribution and the amount of our distributions. Although we have elected to betreated as a RIC commencing with our tax year ending December 31, 2015, no assurance can be given that we will be able to maintain our tax treatment as aRIC in the future.We cannot predict how tax reform legislation will affect us, our investments, or our stockholders, and any such legislation could adversely affect ourbusiness.Legislative or other actions relating to taxes could have a negative effect on us. The rules dealing with U.S. federal income taxation are constantly underreview by persons involved in the legislative process and by the Internal Revenue Service and the U.S. Treasury Department. In December 2017, the U.S.House of Representatives and U.S. Senate passed tax reform legislation, which the President signed into law. Such legislation has made many changes to theCode, including significant changes to the taxation of business entities, the deductibility of interest expense, and the tax treatment of capital investment. Wecannot predict with certainty how any changes in the tax laws might affect us, our stockholders, or our portfolio investments. New legislation and any U.S.Treasury regulations, administrative interpretations or court decisions interpreting such legislation could significantly and negatively affect our ability toqualify for tax treatment as a RIC or the U.S. federal income tax consequences to us and our stockholders of such qualification, or could have other adverseconsequences. Stockholders are urged to consult with their tax advisor regarding tax legislative, regulatory, or administrative developments and proposalsand their potential effect on an investment in our securities.We may not be able to pay distributions to our shareholders, our distributions may not grow over time and a portion of our distributions may be a return ofcapital.We intend to pay distributions to our shareholders out of assets legally available for distribution. We cannot assure investors that we will achieve investmentresults that will allow us to make a specified level of cash distributions or year-to-year increases in cash distributions. Our ability to pay distributions mightbe adversely affected by, among other things, the impact of one or more of the risk factors described in this prospectus. In addition, the inability to satisfy theasset coverage test applicable to us as a BDC can limit our ability to pay distributions. All distributions will be paid at the discretion of our Board41Table of Contentsand will depend on our earnings, our financial condition, maintenance of our RIC tax treatment, compliance with applicable BDC regulations and such otherfactors as our Board may deem relevant from time to time. We cannot assure investors that we will pay distributions to our shareholders in the future.When we make distributions, we will be required to determine the extent to which such distributions are paid out of current or accumulated earnings andprofits. Distributions in excess of current and accumulated earnings and profits will be treated as a non-taxable return of capital to the extent of an investor’sbasis in our stock and, assuming that an investor holds our stock as a capital asset, thereafter as a capital gain. Generally, a non-taxable return of capital willreduce an investor’s basis in our stock for federal tax purposes, which will result in higher tax liability when the stock is sold. Stockholders should read anywritten disclosure accompanying a distribution carefully and should not assume that the source of any distribution is our ordinary income or gains.We may have difficulty paying our required distributions if we recognize income before or without receiving cash representing such income.For U.S. federal income tax purposes, we are required to include in our taxable income certain amounts that we have not yet received in cash, such as originalissue discount, which may arise if we receive warrants in connection with the origination of a loan or possibly in other circumstances, or PIK interest. Suchoriginal issue discount or increases in loan balances as a result of contractual PIK arrangements will be included in our taxable income before we receive anycorresponding cash payments. We also may be required to include in our taxable income certain other amounts that we will not receive in cash. Since, incertain cases, we may recognize taxable income before or without receiving corresponding cash payments, we may have difficulty meeting the AnnualDistribution Requirement necessary to maintain our tax treatment as a RIC. Accordingly, to satisfy our RIC distribution requirements, we may have to sellsome of our investments at times and/or at prices we would not consider advantageous, raise additional debt or equity capital or forgo new investmentopportunities. If we are not able to obtain cash from other sources, we may fail to qualify for tax treatment as a RIC and thus become subject to corporate-level income tax.We may in the future choose to pay dividends in our own stock, in which case investors may be required to pay tax in excess of the cash they receive.We may distribute taxable dividends that are payable in part in our stock. In accordance with certain applicable Treasury regulations and published guidanceissued by the Internal Revenue Service, a publicly offered RIC may treat a distribution of its own stock as fulfilling the RIC distribution requirements if eachshareholder may elect to receive his or her entire distribution in either cash or stock of the RIC, subject to a limitation that the aggregate amount of cash to bedistributed to all shareholders must be at least 20% of the aggregate declared distribution. If too many shareholders elect to receive cash, the cash availablefor distribution must be allocated among the shareholders electing to receive cash (with the balance of the distribution paid in stock). In no event will anyshareholder, electing to receive cash, receive less than the lesser of (a) the portion of the distribution such shareholder has elected to receive in cash or (b) anamount equal to his or her entire distribution times the percentage limitation on cash available for distribution. If these and certain other requirements aremet, for U.S. federal income tax purposes, the amount of the dividend paid in stock will be equal to the amount of cash that could have been received insteadof stock. Taxable shareholders receiving such dividends will be required to include the amount of the dividends as ordinary income (or as long-term capitalgain to the extent such distribution is properly reported as a capital gain dividend) to the extent of our current and accumulated earnings and profits forUnited States federal income tax purposes. As a result, a U.S. shareholder may be required to pay tax with respect to such dividends in excess of any cashreceived. If a U.S. shareholder sells the stock it receives as a dividend in order to pay this tax, the sales proceeds may be less than the amount included inincome with respect to the dividend, depending on the market price of our stock at the time of the sale. Furthermore, with respect to non-U.S. shareholders, wemay be required to withhold U.S. tax with respect to such dividends, including in respect of all or a portion of such dividend that is payable in stock. Inaddition, if a significant number of our shareholders determine to sell shares of our stock in order to pay taxes owed on dividends, it may put downwardpressure on the trading price of our stock.Internal control deficiencies could impact the accuracy of our financial results or prevent the detection of fraud. As a result, shareholders could loseconfidence in our financial and other public reporting, which would harm our business and the trading price of our common stock.Effective internal controls over financial reporting are necessary for us to provide reliable financial reports and, together with adequate disclosure controlsand procedures, are designed to prevent fraud. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financialreporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not beprevented or detected on a timely basis. Any failure by us to identify future deficiencies in our internal control over financial reporting in a timely manner orremediate any42Table of Contentssuch deficiencies, could prevent us from accurately and timely reporting our financial results. Inferior internal controls could also cause investors to loseconfidence in our reported financial information, which could have a negative effect on the trading price of our common stock.We are required to disclose changes made in our internal control and procedures on a quarterly basis and our management is required to assess theeffectiveness of these controls annually. An independent assessment of the effectiveness of our internal controls could detect problems that ourmanagement’s assessment might not. Undetected material weaknesses in our internal controls could lead to financial statement restatements and require us toincur the expense of remediation. In the event that we are unable to maintain or achieve compliance with Section 404 of the Sarbanes-Oxley Act and relatedrules, the market price of our common stock may be adversely affected.Changes in laws or regulations governing our operations may adversely affect our business or cause us to alter our business strategy.We and our portfolio companies will be subject to applicable local, state and federal laws and regulations, including, without limitation, federal immigrationlaws and regulations. New legislation may be enacted or new interpretations, rulings or regulations could be adopted, including those governing the types ofinvestments we are permitted to make, any of which could harm us and our shareholders, potentially with retroactive effect. Additionally, any changes to thelaws and regulations governing our operations relating to permitted investments may cause us to alter our investment strategy in order to avail ourselves ofnew or different opportunities. Such changes could result in material differences to the strategies and plans set forth herein and may result in our investmentfocus shifting from the areas of expertise of our Senior Lending Team and our Executive Committee to other types of investments in which our SeniorLending Team and our Executive Committee may have less expertise or little or no experience. Thus, any such changes, if they occur, could have a materialadverse effect on our results of operations and the value of your investment.NSBF, our wholly-owned subsidiary, is subject to regulation by the SBA.Our wholly-owned subsidiary, NSBF, is licensed by the SBA as an SBLC. In order to operate as an SBLC, a licensee is required to maintain a minimumregulatory capital (as defined by SBA regulations) of the greater of (1) 10% of its outstanding loans receivable and other investments or (2) $1,000,000.Moreover, before consenting to a securitization, NSBF and other securitizers must be considered well capitalized by the SBA. For NSBF and other SBLCsecuritizers, the SBA will consider it well capitalized if it maintains a minimum unencumbered paid in capital and paid in surplus equal to at least 10% of itsassets, excluding the guaranteed portion of 7(a) loans. In addition, an SBLC is subject to certain other regulatory restrictions. Among other things, SBLCs arerequired to: establish, adopt, and maintain a formal written capital plan; submit to the SBA for review a credit policy that demonstrates the SBLC’scompliance with the applicable regulations and the SBA’s Standard Operating Procedures for origination, servicing and liquidation of 7(a) loans; submit tothe SBA for review and approval annual validation, with supporting documentation and methodologies, demonstrating that any scoring model used by theSBLC is predictive of loan performance; obtain SBA approval for loan securitization and borrowings; and adopt and fully implement an internal controlpolicy which provides adequate direction for effective control over and accountability for operations, programs, and resources.We have specific risks associated with SBA loans.We have generally sold the guaranteed portion of SBA loans in the secondary market. Such sales have resulted in our earning premiums and creating a streamof servicing income. There can be no assurance that we will be able to continue originating these loans, or that a secondary market will exist for, or that wewill continue to realize premiums upon the sale of the guaranteed portions of the SBA 7(a) loans.If NSBF fails to comply with SBA regulations in connection with the origination, servicing, or liquidation of an SBA 7(a) loan, liability on the SBAguaranty, in whole or part, could be transferred to NSBF.Since we sell the guaranteed portion of substantially all of our SBA 7(a) loan portfolio, we retain credit risk on the non-guaranteed portion of the SBA loans.We share pro rata with the SBA in any recoveries. In the event of default on an SBA loan, our pursuit of remedies against a borrower is subject to SBAapproval.If we fail to comply with certain of the SBA’s regulations in connection with the origination, servicing, or liquidation of an SBA 7(a) loan, the SBA may bereleased from liability on its guaranty of a 7(a) loan, and may refuse to honor a guaranty purchase request in full (referred to by SBA as a “denial”) or in part(referred to by SBA as a “repair”), or recover all or part of the funds already paid in connection with a guaranty purchase. In the event of a repair or denial,liability on the guaranty, in43Table of Contentswhole or part, would be transferred to NSBF. In addition, the growth in the number of loans made by NSBF, changes in SBA regulations and economic factorsmay adversely impact our current repair and denial rate.Curtailment of the government-guaranteed loan programs could adversely affect our results of operations.Although the program has been in existence since 1953, there can be no assurance that the federal government will maintain the SBA 7(a) loan program, orthat it will continue to guarantee loans at current levels. If we cannot continue originating and selling government-guaranteed loans, we will generate fewerorigination fees and our ability to generate gains on the sale of loans will decrease. From time-to-time, the government agencies that guarantee these loansreach their internal budgeted limits and cease to guarantee loans for a stated time period. In addition, these agencies may change their rules for extendingloans. Also, Congress may adopt legislation that would have the effect of discontinuing or changing the SBA’s programs. Non-governmental programs couldreplace government programs for some borrowers, but the terms might not be equally acceptable. If these changes occur, the volume of loans to SMBs andindustrial borrowers of the types that now qualify for government-guaranteed loans could decline, as could the profitability of these loans.Additionally, under current law, SBA 7(a) lenders must share equally with the SBA any SBA 7(a) loan premium in excess of 110% of the par value of suchloans. Legislation pending in the U.S. Senate would, among other things, require SBA 7(a) lenders to share equally with the SBA any SBA 7(a) loan premiumin excess of 108% of the par value of such loans, thereby decreasing the share of loan premium received by the SBA 7(a) lender. Such legislation also wouldimpose a new fee of 3 basis points on the guaranteed portion of the SBA 7(a) loan. If passed in its present form, the legislation could serve to negativelyimpact the profitability of SBA 7(a) loans and our financial performance and results of operations.Curtailment of our ability to utilize the SBA 7(a) Loan Program by the Federal government could adversely affect our results of operations.We are dependent upon the federal government to maintain the SBA 7(a) Program. There can be no assurance that the program will be maintained or thatloans will continue to be guaranteed at current levels. From time-to-time the SBA has reached its internal budgeted limits and ceased to guarantee loans for astated period of time. In addition, the SBA may change its rules regarding loans or Congress may adopt legislation or fail to approve a budget that wouldhave the effect of discontinuing, reducing availability of funds for, or changing loan programs. Non-governmental programs could replace governmentprograms for some borrowers, but the terms might not be equally acceptable. If these changes occur, the volume of loans to small businesses that now qualifyfor government guaranteed loans could decline, as could the profitability of these loans.NSBF’s failure to maintain PLP status or maintain its SBA 7(a) license could adversely affect our results of operation.NSBF has been granted PLP status and originates, sells and services small business loans and is authorized to place SBA guarantees on loans without seekingprior SBA review and approval. Being a national lender, PLP status allows NSBF to expedite loans since NSBF is not required to present applications to theSBA for concurrent review and approval. The loss of PLP status could adversely impact our marketing efforts and ultimately loan origination volume whichcould negatively impact our results of operations.There can be no assurance that NSBF will be able to maintain its status as a PLP or that NSBF can maintain its SBA 7(a) license. If NSBF cannot continueoriginating and selling government guaranteed loans at current levels, we could experience a decrease in future servicing spreads and earned premiums andnegatively impact our results of operations.Our loans under the Section 7(a) Loan Program involve a high risk of default and such default could adversely impact our results of operations.Loans to small businesses involve a high risk of default. Such loans are generally not rated by any statistical rating organization. Small businesses usuallyhave smaller product lines and market shares than larger companies and therefore may be more vulnerable to competition and general economic conditions.These businesses’ success typically depends on their management talents and efforts of one person or a small group of persons whose death, disability orresignation would adversely affect the business. Because these businesses frequently have highly leveraged capital structures, reduced cash flow resultingfrom economic downturns can severely impact the businesses’ ability to meet their obligations, which could impact our results of operations. The portions ofSection 7(a) loans to be retained by the Company do not benefit directly from any SBA guarantees; in an event of default, however, the Company and theSBA typically cooperate in collateral foreclosure or other work-out efforts and share in any resulting collections.44Table of ContentsThe loans we make under the Section 7(a) Loan Program face competition.There are several other non-bank lenders as well as a large number of banks that participate in the SBA Section 7(a) Loan Program. All of these participantscompete for the business of eligible borrowers. In addition, pursuant to the 1940 Act, the Company is limited as to the amount of indebtedness it may have.Accordingly, the Company may be at a competitive disadvantage with regard to other lenders or financial institutions that may be able to achieve greaterleverage at a lower cost.Our business is subject to increasingly complex corporate governance, public disclosure and accounting requirements that are costly and could adverselyaffect our business and financial results.We are subject to changing rules and regulations of federal and state government as well as the stock exchange on which our common stock is listed. Theseentities, including the Public Company Accounting Oversight Board, the SEC and the Nasdaq Global Market, have issued a significant number of new andincreasingly complex requirements and regulations over the course of the last several years and continue to develop additional regulations and requirementsin response to laws enacted by Congress. Our efforts to comply with existing requirements, or any revised or amended requirements, have resulted in, and maycontinue to result in, an increase in expenses and a diversion of management’s time from other business activities.In addition, our failure to keep pace with any such rules, or for our management to appropriately address compliance with such rules fully and in a timelymanner, exposes us to an increasing risk of inadvertent non-compliance. While our management team takes reasonable efforts to ensure that the Company isin full compliance with all laws applicable to its operations, the increasing rate and extent of regulatory change increases the risk of a failure to comply,which may result in our ability to operate our business in the ordinary course or may subject us to potential fines, regulatory findings or other matters thatmay materially impact our business.If we cannot obtain additional capital because of either regulatory or market price constraints, we could be forced to curtail or cease our new lending andinvestment activities, our net asset value could decrease and our level of distributions and liquidity could be affected adversely.Our ability to secure additional financing and satisfy our financial obligations under indebtedness outstanding from time to time will depend upon our futureoperating performance, which is subject to the prevailing general economic and credit market conditions, including interest rate levels and the availability ofcredit generally, and financial, business and other factors, many of which are beyond our control. The prolonged continuation or worsening of currenteconomic and capital market conditions could have a material adverse effect on our ability to secure financing on favorable terms, if at all.If we are unable to obtain additional debt capital, then our equity investors will not benefit from the potential for increased returns on equity resulting fromleverage to the extent that our investment strategy is successful and we may be limited in our ability to make new commitments or fundings to our portfoliocompanies.Capital markets may experience periods of disruption and instability and we cannot predict when these conditions will occur. Such market conditionscould materially and adversely affect debt and equity capital markets in the United States and abroad, which could have a negative impact on ourbusiness, financial condition and results of operations.As a BDC, we must maintain our ability to raise additional capital for investment purposes. Without sufficient access to the capital markets or credit markets,we may be forced to curtail our business operations or we may not be able to pursue new business opportunities. The U.S. and global capital marketsexperienced extreme volatility and disruption during the economic downturn that began in mid-2007, and the U.S. economy was in a recession for severalconsecutive calendar quarters during the same period. In 2010, a financial crisis emerged in Europe, triggered by high budget deficits and rising direct andcontingent sovereign debt, which created concerns about the ability of certain nations to continue to service their sovereign debt obligations. Risks resultingfrom such debt crisis, including any austerity measures taken in exchange for the bail out of certain nations, and any future debt crisis in Europe or anysimilar crisis elsewhere could have a detrimental impact on the global economic recovery, sovereign and non-sovereign debt in certain countries and thefinancial condition of financial institutions generally. In June 2016, the United Kingdom held a referendum in which voters approved an exit from theEuropean Union (“Brexit”), and, accordingly, on February 1, 2017, the U.K. Parliament voted in favor of allowing the U.K. government to begin the formalprocess of Brexit. Brexit created political and economic uncertainty and instability in the global markets (including currency and credit markets), andespecially in the United Kingdom and the European Union, and this uncertainty and instability may last indefinitely. There is continued concern aboutnational-level support for the Euro and the accompanying coordination of fiscal and wage policy among European Economic and Monetary Union membercountries. In addition, the fiscal and monetary policies of foreign nations, such as Russia and China, may have a severe impact on the worldwide and U.S.financial markets.45Table of ContentsAdditionally, as a result of the 2016 U.S. election, the Republican Party currently controls both the executive and legislative branches of government, whichincreases the likelihood that legislation may be adopted that could significantly affect the regulation of U.S. financial markets. Areas subject to potentialchange, amendment, or repeal include the Dodd-Frank Act and the authority of the Federal Reserve and the Financial Stability Oversight Council. The U.S.may also potentially withdraw from or renegotiate various trade agreements and take other actions that would change current trade policies of the U.S. Wecannot predict which, if any, of these actions will be taken or, if taken, their effect on the financial stability of the U.S. Such actions could have a significantadverse effect on our business, financial condition and results of operations. We cannot predict the effects of these or similar events in the future on the U.S.economy and securities markets or on our investments. We monitor developments and seek to manage our investments in a manner consistent with achievingour investment objective, but there can be no assurance that we will be successful in doing so.A failure or the perceived risk of a failure to raise the statutory debt limit of the U.S. could have a material adverse effect on our business, financialcondition and results of operations.Recent U.S. debt ceiling and budget deficit concerns have increased the possibility of additional credit-rating downgrades and economic slowdowns, or arecession in the U.S. In the future, the U.S. government may not be able to meet its debt payments unless the federal debt ceiling is raised. If legislationincreasing the debt ceiling is not enacted, as needed, and the debt ceiling is reached, the U.S. federal government may stop or delay making payments on itsobligations, which could negatively impact the U.S. economy and our portfolio companies. In addition, disagreement over the federal budget has caused theU.S. federal government to shut down for periods of time, most recently, in January 2018. Continued adverse political and economic conditions could have amaterial adverse effect on our business, financial condition and results of operations.A government shutdown could adversely affect NSBF’s SBA 7(a) loan originations and our results of operations.We are dependent upon the Federal government to maintain the SBA 7(a) Program. NSBF’s lending business could be materially and adversely affected bycircumstances or events limiting the availability of funds for this program. In October 2013, Congress failed to approve a budget, which, in turn, eliminatedavailability of funds for the SBA 7(a) program. At the time, the government shutdown affected SBA 7(a) lenders’ ability to originate SBA 7(a) loans. Morerecently, the government shut down in January 2018 due to a lapse in appropriations, and the SBA closed all non-disaster related programs and activities,including the SBA 7(a) program. The government could again experience a government shutdown which would affect NSBF’s ability to originategovernment guaranteed loans and to sell the government guaranteed portions of those loans in the secondary market. Any government shutdown couldadversely affect NSBF’s SBA 7(a) loan originations and our results of operations.We are highly dependent on information systems and systems failures could significantly disrupt our business, which may, in turn, negatively affect themarket price of our securities and our ability to make distributions to our shareholders.Our business is highly dependent on our communications and information systems. Certain of these systems are provided to us by third party serviceproviders. Any failure or interruption of such systems, including as a result of the termination of an agreement with any such third party service provider,could cause delays or other problems in our activities. This, in turn, could have a material adverse effect on our operating results and negatively affect themarket price of our securities and our ability to make distributions to our shareholders.Terrorist attacks, acts of war or natural disasters may affect any market for our securities, impact the businesses in which we invest and harm our business,operating results and financial condition.Terrorist acts, acts of war or natural disasters may disrupt our operations, as well as the operations of the businesses in which we invest. Such acts havecreated, and continue to create, economic and political uncertainties and have contributed to global economic instability. Future terrorist activities, militaryor security operations, or natural disasters could further weaken the domestic/global economies and create additional uncertainties, which may negativelyimpact the businesses in which we invest directly or indirectly and, in turn, could have a material adverse impact on our business, operating results andfinancial condition. Losses from terrorist attacks and natural disasters are generally uninsurable.We could be adversely affected by information security breaches or cyber security attacks.Our business operations and our portfolio companies’ business operations rely upon secure information technology systems for data processing, storage andreporting. Despite security and controls design, implementation and updating, such information technology systems could become subject to cyber-attacks.Network, system, application and data breaches could result in46Table of Contentsoperational disruptions or information misappropriation, which could have a material adverse effect on our business, results of operations and financialcondition.In addition, our business operations and our portfolio companies’ business operations involve the storage and transmission of Newtek, portfolio company,customer and employee proprietary information. Our businesses rely on our digital technologies, computer and email systems, software, and networks toconduct operations. Our technologies, systems and networks may become the target of criminal cyber-attacks or information security breaches that couldresult in the unauthorized release, gathering, monitoring, misuse, loss or destruction of confidential, proprietary and other information of us, our portfoliocompanies, or third parties with whom we and our portfolio companies deal, or otherwise disrupt our or our customers’ or other third parties’ businessoperations. It is critical to our business strategy that our facilities and infrastructure remain secure and are perceived by the marketplace to be secure.Although we believe we employ appropriate security technologies (including data encryption processes, intrusion detection systems), and conductcomprehensive risk assessments and other internal control procedures to assure the security of our and our customers’ data, we cannot guarantee that thesemeasures will be sufficient for this purpose. If our security measures are breached as a result of third-party action, employee error or otherwise, and as a resultour or our customers’ data becomes available to unauthorized parties, we could incur liability and our reputation would be damaged, which could lead to theloss of current and potential customers. If we experience any breaches of our network security or sabotage, we might be required to expend significant capitaland other resources to detect, remedy, protect against or alleviate these and related problems, and we may not be able to remedy these problems in a timelymanner, or at all. Because techniques used by outsiders to obtain unauthorized network access or to sabotage systems change frequently and generally are notrecognized until launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures. For example, anunauthorized third party recently misappropriated three of NTS’ domain names. NTS’ management is currently investigating the incident. As cyber threatscontinue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigateand remediate any information security vulnerabilities. Although we have insurance in place that covers such incidents, the cost of a breach or cyber-attackcould well exceed any such insurance coverage.The failure in cyber-security systems, as well as the occurrence of events unanticipated in our disaster recovery systems and management continuityplanning could impair our ability to conduct business effectively.The occurrence of a disaster such as a cyber-attack, a natural catastrophe, an industrial accident, a terrorist attack or war, events unanticipated in our disasterrecovery systems, or a support failure from external providers, could have an adverse effect on our ability to conduct business and on our results of operationsand financial condition, particularly if those events affect our computer-based data processing, transmission, storage, and retrieval systems or destroy data. Ifa significant number of our managers were unavailable in the event of a disaster, our ability to effectively conduct our business could be severelycompromised.We and our portfolio companies depend heavily upon computer systems to perform necessary business functions. Despite our portfolio companiesimplementation of a variety of security measures, our computer systems could be subject to cyber-attacks and unauthorized access, such as physical andelectronic break-ins or unauthorized tampering. Like other companies, we and our portfolio companies may experience threats to our data and systems,including malware and computer virus attacks, unauthorized access, system failures and disruptions. If one or more of these events occurs, it could potentiallyjeopardize the confidential, proprietary and other information processed and stored in, and transmitted through, our and our portfolio company computersystems and networks, or otherwise cause interruptions or malfunctions in our operations, which could result in damage to our and our portfolio companies’reputation, financial losses, litigation, increased costs, regulatory penalties and/or customer dissatisfaction or loss.RISKS RELATED TO OUR INVESTMENTS GENERALLYOur investments are very risky and highly speculative.We invest primarily in senior secured term loans and select equity investments issued by companies, some of which are highly leveraged. The majority ofsenior secured loans are SBA 7(a) loans and the majority of equity investments are comprised of controlled affiliate equity investments.Senior Secured Loans. There is a risk that the collateral securing our loans, in most cases real estate, may decrease in value over time, may be difficult to sellin a timely manner, may be difficult to appraise and may fluctuate in value based upon the success of the business and market conditions, including as aresult of the inability of the portfolio company to raise additional capital, and, in some circumstances, our lien could be subordinated to claims of othercreditors. In addition, deterioration in a47Table of Contentsportfolio company’s financial condition and prospects, including its inability to raise additional capital, may be accompanied by deterioration in the valueof the collateral for the loan. Consequently, the fact that a loan is secured does not guarantee that we will receive principal and interest payments accordingto the loan’s terms, or at all, or that we will be able to collect on the loan should we be forced to enforce our remedies. In some cases we may take second lienposition on additional business or personal assets to secure further our first lien positions.Equity Investments. We occasionally invest directly in the equity securities of portfolio companies. The equity interests we receive may not appreciate invalue and, in fact, may decline in value. Accordingly, we may not be able to realize gains from our equity interests, and any gains that we do realize on thedisposition of any equity interests may not be sufficient to offset any other losses we experience.In addition, investing in SMBs involves a number of significant risks, including:•these companies may have limited financial resources and may be unable to meet their obligations under their debt securities that we hold, whichmay be accompanied by a deterioration in the value of any collateral and a reduction in the likelihood of us realizing any guarantees we may haveobtained in connection with our investment;•they typically have shorter operating histories, narrower product lines and smaller market shares than larger businesses, which tend to render themmore vulnerable to competitors’ actions and market conditions, as well as general economic downturns;•they are more likely to depend on the management talents and efforts of a small group of persons; therefore, the death, disability, resignation ortermination of one or more of these persons could have a material adverse impact on our portfolio company and, in turn, on us;•they generally have less predictable operating results, may from time to time be parties to litigation, may be engaged in rapidly changing businesseswith products subject to a substantial risk of obsolescence, and may require substantial additional capital to support their operations, financeexpansion or maintain their competitive position;•they may have difficulty accessing the capital markets to meet future capital needs, which may limit their ability to grow or to repay theiroutstanding indebtedness upon maturity; and•our executive officers and directors may, in the ordinary course of business, be named as defendants in litigation arising from our investments in theportfolio companies.An investment strategy focused primarily on smaller privately held companies involves a high degree of risk and presents certain challenges, including thelack of available information about these companies, a dependence on the talents and efforts of only a few key portfolio company personnel and a greatervulnerability to economic downturns.Our portfolio consists primarily of debt and equity investments in smaller privately-owned companies. Investing in these types of companies involves anumber of significant risks. Typically, the debt in which we invest is not initially rated by any rating agency; however, we believe that if such investmentswere rated, they would be below investment grade. Below investment grade securities, which are often referred to as “high yield” or “junk,” havepredominantly speculative characteristics with respect to the issuer’s capacity to pay interest and repay principal. Compared to larger publicly-ownedcompanies, these small companies may be in a weaker financial position and experience wider variations in their operating results, which may make themmore vulnerable to economic downturns. Typically, these companies need more capital to compete; however, their access to capital is limited and their costof capital is often higher than that of their competitors. Our portfolio companies often face intense competition from larger companies with greater financial,technical and marketing resources and their success typically depends on the managerial talents and efforts of an individual or a small group of persons.Therefore, any loss of its key employees could affect a portfolio company’s ability to compete effectively and harm its financial condition. Further, some ofthese companies conduct business in regulated industries that are susceptible to regulatory changes. These factors could impair the cash flow of our portfoliocompanies and result in other events, such as bankruptcy. These events could limit a portfolio company’s ability to repay its obligations to us, which mayhave an adverse effect on the return on, or the recovery of, our investment in these businesses. Deterioration in a borrower’s financial condition and prospectsmay be accompanied by deterioration in the value of the loan’s collateral.Generally, little public information exists about these companies, and we are required to rely on the ability of our Senior Lending Team and our ExecutiveCommittee to obtain adequate information to evaluate the potential returns from investing in these companies. If we are unable to uncover all materialinformation about these companies, we may not make a fully48Table of Contentsinformed investment decision, and we may lose money on our investments. Also, privately held companies frequently have less diverse product lines andsmaller market presence than larger competitors. These factors could adversely affect our investment returns as compared to companies investing primarily inthe securities of public companies.Our investments in leveraged portfolio companies may be risky, and you could lose all or part of your investment.Investment in leveraged companies involves a number of significant risks. Leveraged companies in which we invest may have limited financial resources andmay be unable to meet their obligations under their loans and debt securities that we hold. Such developments may be accompanied by deterioration in thevalue of any collateral and a reduction in the likelihood of our realizing any guarantees that we may have obtained in connection with our investment.Smaller leveraged companies also may have less predictable operating results and may require substantial additional capital to support their operations,finance their expansion or maintain their competitive position.Our portfolio companies may incur debt that ranks equally with, or senior to, our investments in such companies.Our portfolio companies may have, or may be permitted to incur, other debt that ranks equally with, or in some cases senior to, the debt in which we invest.By their terms, such debt instruments may entitle the holders to receive payment of interest or principal on or before the dates on which we are entitled toreceive payments with respect to the debt instruments in which we invest. Also, in the event of insolvency, liquidation, dissolution, reorganization orbankruptcy of a portfolio company, holders of debt instruments ranking senior to our investment in that portfolio company would typically be entitled toreceive payment in full before we receive any distribution. After repaying such senior creditors, such portfolio company may not have sufficient remainingassets to repay its obligation to us. In the case of debt ranking equally with debt instruments in which we invest, we would have to share on an equal basisany distributions with other creditors holding such debt in the event of an insolvency, liquidation, dissolution, reorganization or bankruptcy of the relevantportfolio company.Second priority liens on collateral securing loans that we make to our portfolio companies may be subject to control by senior creditors with first priorityliens. If there is a default, the value of the collateral may not be sufficient to repay in full both the first priority creditors and us.Certain loans that we make are secured by a second priority security interest in the same collateral pledged by a portfolio company to secure senior first liendebt owed by the portfolio company to commercial banks or other traditional lenders. Often the senior lender has procured covenants from the portfoliocompany prohibiting the incurrence of additional secured debt without the senior lender’s consent. Prior to and as a condition of permitting the portfoliocompany to borrow money from us secured by the same collateral pledged to the senior lender, the senior lender will require assurances that it will control thedisposition of any collateral in the event of bankruptcy or other default. In many such cases, the senior lender will require us to enter into an “intercreditoragreement” prior to permitting the portfolio company to borrow from us. Typically the intercreditor agreements we will be requested to expressly subordinateour debt instruments to those held by the senior lender and further provide that the senior lender shall control: (1) the commencement of foreclosure or otherproceedings to liquidate and collect on the collateral; (2) the nature, timing and conduct of foreclosure or other collection proceedings; (3) the amendment ofany collateral document; (4) the release of the security interests in respect of any collateral; and (5) the waiver of defaults under any security agreement.Because of the control we may cede to senior lenders under intercreditor agreements we may enter, we may be unable to realize the proceeds of any collateralsecuring some of our loans.If we make subordinated investments, the obligors or the portfolio companies may not generate sufficient cash flow to service their debt obligations to us.We may make subordinated investments that rank below other obligations of the obligor in right of payment. Subordinated investments are subject to greaterrisk of default than senior obligations as a result of adverse changes in the financial condition of the obligor or economic conditions in general. If we make asubordinated investment in a portfolio company, the portfolio company may be highly leveraged, and its relatively high debt-to-equity ratio may createincreased risks that its operations might not generate sufficient cash flow to service all of its debt obligations.The disposition of our investments may result in contingent liabilities.We currently expect that substantially all of our investments will involve loans and private securities. In connection with the disposition of an investment inloans and private securities, we may be required to make representations about the business and financial affairs of the portfolio company typical of thosemade in connection with the sale of a business. We may also be required to indemnify the purchasers of such investment to the extent that any suchrepresentations turn out to be inaccurate or49Table of Contentswith respect to potential liabilities. These arrangements may result in contingent liabilities that ultimately result in funding obligations that we must satisfythrough our return of distributions previously made to us.There may be circumstances where our debt investments could be subordinated to claims of other creditors or we could be subject to lender liability claims.Even though we may have structured certain of our investments as secured loans, if one of our portfolio companies were to go bankrupt, depending on thefacts and circumstances, and based upon principles of equitable subordination as defined by existing case law, a bankruptcy court could subordinate all or aportion of our claim to that of other creditors and transfer any lien securing such subordinated claim to the bankruptcy estate. The principles of equitablesubordination defined by case law have generally indicated that a claim may be subordinated only if its holder is guilty of misconduct or where the seniorloan is re-characterized as an equity investment and the senior lender has actually provided significant managerial assistance to the bankrupt debtor. We mayalso be subject to lender liability claims for actions taken by us with respect to a borrower’s business or instances where we exercise control over theborrower. It is possible that we could become subject to a lender’s liability claim, including as a result of actions taken in rendering significant managerialassistance or actions to compel and collect payments from the borrower outside the ordinary course of business.Economic recessions could impair our portfolio companies and harm our operating results.Certain of our portfolio companies may be susceptible to an economic downturn and may be unable to repay our loans during this period. Therefore, assetsmay become non-performing and the value of our portfolio may decrease during this period. The adverse economic conditions also may decrease the value ofcollateral securing some of our loans and the value of our equity investments. A recession could lead to financial losses in our portfolio and a decrease inrevenues, net income and the value of our assets.The lack of liquidity in our investments may adversely affect our business.We generally invest in companies whose securities are not publicly traded, and whose securities will be subject to legal and other restrictions on resale or willotherwise be less liquid than publicly traded securities. There is no established trading market for the securities in which we invest. The illiquidity of theseinvestments may make it difficult for us to sell these investments when desired. In addition, if we are required to liquidate all or a portion of our portfolioquickly, we may realize significantly less than the value at which we had previously recorded these investments. As a result, we do not expect to achieveliquidity in our investments in the near-term. Further, we may face other restrictions on our ability to liquidate an investment in a portfolio company to theextent that we have material non-public information regarding such portfolio company.Our failure to make follow-on investments in our portfolio companies could impair the value of our portfolio.Following an initial investment in a portfolio company, we may make additional investments in that portfolio company as “follow-on” investments, in orderto: (1) increase or maintain in whole or in part our equity ownership percentage; (2) exercise warrants, options or convertible securities that were acquired inthe original or a subsequent financing; or (3) attempt to preserve or enhance the value of our investment. We may elect not to make follow-on investments orotherwise lack sufficient funds to make those investments. We will have the discretion to make any follow-on investments, subject to the availability ofcapital resources. The failure to make follow-on investments may, in some circumstances, jeopardize the continued viability of a portfolio company and ourinitial investment, or may result in a missed opportunity for us to increase our participation in a successful operation. Even if we have sufficient capital tomake a desired follow-on investment, we may elect not to make a follow-on investment because we do not want to increase our concentration of risk, weprefer other opportunities, we are subject to BDC requirements that would prevent such follow-on investments, or the follow-on investment would affect ourqualification as a RIC.Our portfolio may lack diversification among portfolio companies which may subject us to a risk of significant loss if one or more of these companiesdefault on its obligations under any of its debt instruments.Our portfolio holds a limited number of controlled affiliate portfolio companies. Beyond the asset diversification requirements associated with ourqualification as a RIC under the Code, we do not have fixed guidelines for diversification, and our investments may be concentrated in relatively fewcompanies. As our portfolio is less diversified than the portfolios of some larger funds, we are more susceptible to failure if a single loan fails. Similarly, theaggregate returns we realize may be significantly adversely affected if a small number of investments perform poorly or if we need to write down the value ofany one investment.50Table of ContentsWe are a non-diversified investment company within the meaning of the 1940 Act, and therefore we may invest a significant portion of our assets in arelatively small number of issuers, which subjects us to a risk of significant loss if any of theseissuers defaults on its obligations under any of its debt instruments or as a result of a downturn in the particular industry.We are classified as a non-diversified investment company within the meaning of the 1940 Act, and therefore we may invest a significant portion of our assetsin a relatively small number of issuers in a limited number of industries. As of December 31, 2017, our three largest investments, UPSW, NBCS and Premierequaled approximately 15%, 3% and 4%, respectively, of the fair value of our total assets. Beyond the asset diversification requirements associated with ourqualification as a RIC, we do not have fixed guidelines for diversification, and while we are not targeting any specific industries, relatively few industriesmay become significantly represented among our investments. To the extent that we assume large positions in the securities of a small number of issuers, ournet asset value may fluctuate to a greater extent than that of a diversified investment company as a result of changes in the financial condition or the market’sassessment of the issuer, changes in fair value over time or a downturn in any particular industry. We may also be more susceptible to any single economic orregulatory occurrence than a diversified investment company.Our portfolio may be concentrated in a limited number of industries, which may subject us to a risk of significant loss if there is a downturn in a particularindustry in which a number of our investments are concentrated.Our portfolio may be concentrated in a limited number of industries. A downturn in any particular industry in which we are invested could significantlyimpact the aggregate returns we realize. If an industry in which we have significant investments suffers from adverse business or economic conditions, asthese industries have to varying degrees, a material portion of our investment portfolio could be affected adversely, which, in turn, could adversely affect ourfinancial position and results of operations.Because we may not hold controlling equity interests in certain of our portfolio companies, we may not be in a position to exercise control over ourportfolio companies or to prevent decisions by management of our portfolio companies that could decrease the value of our investments.We do not currently hold controlling equity positions in the majority of our portfolio companies where our investments are in the form of debt, particularlySBA loans. As a result, we are subject to the risk that a portfolio company may make business decisions with which we disagree, and that the managementand/or shareholders of a portfolio company may take risks or otherwise act in ways that are adverse to our interests. Due to the lack of liquidity of the debtand equity investments that we typically hold in our portfolio companies, we may not be able to dispose of our investments in the event we disagree with theactions of a portfolio company and may therefore suffer a decrease in the value of our investments.Defaults by our portfolio companies will harm our operating results.A portfolio company’s failure to satisfy financial or operating covenants imposed by us or other lenders could lead to defaults and, potentially, termination ofits loans and foreclosure on its secured assets, which could trigger cross-defaults under other agreements and jeopardize our portfolio company’s ability tomeet its obligations under the debt securities that we hold. We may incur expenses to the extent necessary to seek recovery upon default or to negotiate newterms with a defaulting portfolio company. Any extension or restructuring of our loans could adversely affect our cash flows. In addition, if one of ourportfolio companies were to go bankrupt, even though we may have structured our interest as senior debt, depending on the facts and circumstances,including the extent to which we actually provided managerial assistance to that portfolio company, a bankruptcy court might recharacterize our debtholding and subordinate all or a portion of our claim to that of other creditors. If any of these occur, it could materially and adversely affect our operatingresults and cash flows.If we and our portfolio companies are unable to protect our intellectual property rights, our business and prospects could be harmed, and if we and ourportfolio companies are required to devote significant resources to protecting their intellectual property rights, the value of our investment could bereduced.The proprietary software essential to our business and that of our controlled portfolio companies is owned by us and made available to them for their use. Ourfuture success and competitive position will depend in part upon our ability to maintain and protect proprietary technology used in our products andservices. We will rely, in part, on patent, trade secret and trademark law to protect that technology, but competitors may misappropriate our intellectualproperty, and disputes as to ownership of intellectual property may arise. We may, from time to time, be required to institute litigation to enforce the patents,copyrights or other intellectual property rights, protect trade secrets, determine the validity and scope of the proprietary rights of others or defend againstclaims of infringement. Such litigation could result in substantial costs and diversion of resources.51Table of ContentsPrepayments of our debt investments by our portfolio companies could adversely impact our results of operations and reduce our return on equity.We will be subject to the risk that the investments we make in our portfolio companies may be repaid prior to maturity; most of our SBA loans do not carryprepayment penalties. When this occurs, we will generally reinvest these proceeds in temporary investments or repay outstanding debt, depending on futureinvestment in new portfolio companies. Temporary investments will typically have substantially lower yields than the debt being prepaid and we couldexperience significant delays in reinvesting these amounts. Any future investment in a new portfolio company may also be at lower yields than the debt thatwas repaid. As a result, our results of operations could be materially adversely affected if one or more of our portfolio companies elect to prepay amountsowed to us. Additionally, prepayments could negatively impact our return on equity, which could result in a decline in the market price of our securities.We may not realize gains from our equity investments.Certain investments that we may make in the future include warrants or other equity securities. Investments in equity securities involve a number ofsignificant risks, including the risk of further dilution as a result of additional issuances, inability to access additional capital and failure to pay currentdistributions. Investments in preferred securities involve special risks, such as the risk of deferred distributions, credit risk, illiquidity and limited votingrights. In addition, we may from time to time make non-control, equity investments in portfolio companies. Our goal is ultimately to realize gains upon ourdisposition of such equity interests. However, the equity interests we receive may not appreciate in value and, in fact, may decline in value. Accordingly, wemay not be able to realize gains from our equity interests, and any gains that we do realize on the disposition of any equity interests may not be sufficient tooffset any other losses we experience.We also may be unable to realize any value if a portfolio company does not have a liquidity event, such as a sale of the business, recapitalization or publicoffering, which would allow us to sell the underlying equity interests. We will often seek puts or similar rights to give us the right to sell our equity securitiesback to the portfolio company issuer. We may be unable to exercise these puts rights for the consideration provided in our investment documents if the issueris in financial distress.We may expose ourselves to risks if we engage in hedging transactions.If we engage in hedging transactions, we may expose ourselves to certain risks associated with such transactions. We may utilize instruments such as forwardcontracts, currency options and interest rate swaps, caps, collars and floors to seek to hedge against fluctuations in the relative values of our portfoliopositions from changes in currency exchange rates and market interest rates. Hedging against a decline in the values of our portfolio positions does noteliminate the possibility of fluctuations in the values of such positions or prevent losses if the values of such positions decline. However, such hedging canestablish other positions designed to gain from those same developments, thereby offsetting the decline in the value of such portfolio positions. Suchhedging transactions may also limit the opportunity for gain if the values of the underlying portfolio positions increase. It may not be possible to hedgeagainst an exchange rate or interest rate fluctuation that is so generally anticipated that we are not able to enter into a hedging transaction at an acceptableprice. Moreover, for a variety of reasons, we may not seek to establish a perfect correlation between such hedging instruments and the portfolio holdingsbeing hedged. Any such imperfect correlation may prevent us from achieving the intended hedge and expose us to risk of loss. In addition, it may not bepossible to hedge fully or perfectly against currency fluctuations affecting the value of securities denominated in non-U.S. currencies because the value ofthose securities is likely to fluctuate as a result of factors not related to currency fluctuations.An increase in non-performing assets would reduce our income and increase our expenses.If our level of non-performing assets in our SBA lending business rises in the future, it could adversely affect our investment income and earnings. Non-performing assets are primarily loans on which borrowers are not making their required payments. Non-performing assets also include loans that have beenrestructured to permit the borrower to have smaller payments and real estate that has been acquired through foreclosure of unpaid loans. To the extent that ourfinancial assets are non-performing, we will have less cash available for lending and other activities.If the assets securing the loans that we make decrease in value, then we may lack sufficient collateral to cover losses.To attempt to mitigate credit risks, we will typically take a security interest in the available assets of our portfolio companies. There is no assurance that wewill obtain or properly perfect our liens. There is a risk that the collateral securing our loans may decrease in value over time, may be difficult to sell in atimely manner, may be difficult to appraise and may fluctuate in value based upon the success of the business and market conditions, including as a result ofthe inability of a portfolio company to raise additional capital. In some circumstances, our lien could be subordinated to claims of other creditors.Consequently, the52Table of Contentsfact that a loan is secured does not guarantee that we will receive principal and interest payments according to the loan’s terms, or that we will be able tocollect on the loan should we be forced to enforce our remedies.In addition, because we may invest in technology-related companies, a substantial portion of the assets securing our investment may be in the form ofintellectual property, if any, inventory and equipment and, to a lesser extent, cash and accounts receivable. Intellectual property, if any, that is securing ourloan could lose value if, among other things, the company’s rights to the intellectual property are challenged or if the company’s license to the intellectualproperty is revoked or expires, the technology fails to achieve its intended results or a new technology makes the intellectual property functionally obsolete.Inventory may not be adequate to secure our loan if our valuation of the inventory at the time that we made the loan was not accurate or if there is a reductionin the demand for the inventory.Similarly, any equipment securing our loan may not provide us with the anticipated security if there are changes in technology or advances in newequipment that render the particular equipment obsolete or of limited value, or if the company fails to adequately maintain or repair the equipment. Any oneor more of the preceding factors could materially impair our ability to recover principal in a foreclosure.We could be adversely affected by weakness in the residential housing and commercial real estate markets.Continued weakness in residential home and commercial real estate values could impair our ability to collect on defaulted SBA loans as real estate is pledgedin many of our SBA loans as part of the collateral package.Changes to United States tariff and import/export regulations may have a negative effect on our portfolio companies and, in turn, harm us.There has been on-going discussion and commentary regarding potential significant changes to United States trade policies, treaties and tariffs. The currentadministration, along with Congress, has created significant uncertainty about the future relationship between the United States and other countries withrespect to the trade policies, treaties and tariffs. These developments, or the perception that any of them could occur, may have a material adverse effect onglobal economic conditions and the stability of global financial markets, and may significantly reduce global trade and, in particular, trade between theimpacted nations and the United States. Any of these factors could depress economic activity and restrict our portfolio companies’ access to suppliers orcustomers and have a material adverse effect on their business, financial condition and results of operations, which in turn would negatively impact us.RISKS RELATED TO OUR CONTROLLED PORTFOLIO COMPANIES - NEWTEK MERCHANT SOLUTIONS (NMS) AND NEWTEK PAYMENTSOLUTIONS (PREMIER PAYMENTS)We could be adversely affected if either of NMS’ two bank sponsors is terminated.Because NMS is not a bank, it is unable to belong to and directly access the Visa® and MasterCard® bankcard associations. The Visa® and MasterCard®operating regulations require NMS to be sponsored by a bank in order to process bankcard transactions. A bank sponsorship is an agreement under which afinancial institution that has a membership with MasterCard®, Visa® or American Express sponsors an independent sales organization, like NMS, thatmarkets credit card processing services to merchants who accept credit cards as a form of payment, gains access to the Visa®, MasterCard®, and AmericanExpress networks. NMS is currently sponsored by two banks. If either of the sponsorships is terminated, and NMS is not able to secure or transfer therespective merchant portfolio to a new bank sponsor or sponsors, the business, financial condition, results of operations and cash flows of the electronicpayment processing business could be materially adversely affected. If both the sponsorships are terminated and NMS is unable to secure a bank sponsor forthe merchant portfolios, it will not be able to process bankcard transactions for the affected portfolios. Consequently, the loss of both of NMS’ sponsorshipswould have a material adverse effect on our business. Furthermore, NMS’ agreements with sponsoring banks gives the sponsoring banks substantialdiscretion in approving certain elements of its business practices, including its solicitation, application and qualification procedures for merchants, the termsof their agreements with merchants, the processing fees that they charge, their customer service levels and its use of independent sales organizations andindependent sales agents. We cannot guarantee that NMS’ sponsoring banks’ actions under these agreements would not be detrimental to us.Other service providers, some of whom are NMS’ competitors, are necessary for the conduct of NMS’ business. The termination by service providers of thesearrangements with NMS or their failure to perform these services efficiently and effectively may adversely affect NMS’ relationships with the merchantswhose accounts it serves and may cause those merchants to terminate their processing agreements with NMS.53Table of ContentsIf NMS or its processors or bank sponsors fail to adhere to the standards of the Visa® and MasterCard® bankcard associations, its registrations with theseassociations could be terminated and it could be required to stop providing payment processing services for Visa® and MasterCard®.Substantially all of the transactions NMS processes involve Visa® or MasterCard®. If NMS, its bank sponsors or its processors fail to comply with theapplicable requirements of the Visa® and MasterCard® bankcard associations, Visa® or MasterCard® could suspend or terminate its registration. Thetermination of NMS’ registration or any changes in the Visa® or MasterCard® rules that would impair its registration could require it to stop providingpayment processing services, which would have a material adverse effect on its business and could be detrimental to us.On occasion, NMS experiences increases in interchange and sponsorship fees. If it cannot pass along these increases to its merchants, its profit marginswill be reduced.NMS pays interchange fees or assessments to bankcard associations for each transaction it processes using their credit, debit and gift cards. From time to time,the bankcard associations increase the interchange fees that they charge processors and the sponsoring banks, which generally pass on such increases toNMS. From time to time, the sponsoring banks increase their fees as well. If NMS is not able to pass these fee increases along to merchants throughcorresponding increases in its processing fees, its profit margins in this line of business will be reduced.Unauthorized disclosure of merchant or cardholder data, whether through breach of our computer systems or otherwise, could expose us to liability andbusiness losses.Through NMS, we collect and store sensitive data about merchants and cardholders, and we maintain a database of cardholder data relating to specifictransactions, including payment, card numbers and cardholder addresses, in order to process the transactions and for fraud prevention and other internalprocesses. If anyone penetrates our network security or otherwise misappropriates sensitive merchant or cardholder data, we could be subject to liability orbusiness interruption. While we subject these systems to periodic independent testing and review, we cannot guarantee that our systems will not bepenetrated in the future. If a breach of our system occurs, we may be subject to liability, including claims for unauthorized purchases with misappropriatedcard information, impersonation or other similar fraud claims. Similar risks exist with regard to the storage and transmission of such data by our processors. Inthe event of any such a breach, we may also be subject to a class action lawsuit. SMBs are less prepared for the complexities of safeguarding cardholder datathan their larger counterparts. In the event of noncompliance by a customer of card industry rules, we could face fines from payment card networks. There canbe no assurance that we would be able to recover any such fines from such customer.NMS is liable if its processing merchants refuse or cannot reimburse charge-backs resolved in favor of their customers.If a billing dispute between a merchant and a cardholder is not ultimately resolved in favor of the merchant, the disputed transaction is “charged back” to themerchant’s bank and credited to the account of the cardholder. If NMS or its processing banks are unable to collect the charge-back from the merchant’saccount, or if the merchant refuses or is financially unable due to bankruptcy or other reasons to reimburse the merchant’s bank for the charge-back, NMSmust bear the loss for the amount of the refund paid to the cardholder’s bank. Most of NMS’ merchants deliver products or services when purchased, so acontingent liability for charge-backs is unlikely to arise, and credits are issued on returned items. However, some of its merchants do not provide servicesuntil sometime after a purchase, which increases the potential for contingent liability and future charge backs. NMS and the sponsoring bank can require thatmerchants maintain cash reserves under its control to cover charge back liabilities but such reserves may not be sufficient to cover the liability or may noteven be available to them in the event of a bankruptcy or other legal action.NMS has potential liability for customer or merchant fraud.Credit card fraud occurs when a merchant’s customer uses a stolen card (or a stolen card number in a card-not-present transaction) to purchase merchandise orservices. In a traditional card-present transaction, if the merchant swipes the card, receives authorization for the transaction from the card issuing bank andverifies the signature on the back of the card against the paper receipt signed by the customer, the card issuing bank remains liable for any loss. In afraudulent card-not-present transaction, even if the merchant receives authorization for the transaction, the merchant is liable for any loss arising from thetransaction. Many NMS customers are small and transact a substantial percentage of their sales over the Internet or by telephone or mail orders. Because theirsales are card-not-present transactions, these merchants are more vulnerable to customer fraud than larger merchants, and NMS could experience charge-backsarising from cardholder fraud more frequently with these merchants.54Table of ContentsMerchant fraud occurs when a merchant, rather than a customer, knowingly uses a stolen or counterfeit card or card number to record a false sales transactionor intentionally fails to deliver the merchandise or services sold in an otherwise valid transaction. Anytime a merchant is unable to satisfy a charge-back,NMS is ultimately responsible for that charge-back unless it has required that a cash reserve be established. We cannot assure that the systems and proceduresNMS has established to detect and reduce the impact of merchant fraud are or will be effective. Failure to effectively manage risk and prevent fraud couldincrease NMS charge-back liability and adversely affect its results of operations.NMS payment processing systems may fail due to factors beyond its control, which could interrupt its business or cause it to lose business and likelyincrease costs.NMS depends on the uninterrupted operations of our computer network systems, software and our processors’ data centers. Defects in these systems ordamage to them due to factors beyond its control could cause severe disruption to NMS’ business and other material adverse effects on its paymentprocessing businesses.The electronic payment processing business is undergoing very rapid technological changes which may make it difficult or impossible for NMS or PremierPayments to compete effectively.The introduction of new technologies, primarily mobile payment capabilities, and the entry into the payment processing market of new competitors, Apple,Inc., for example, could dramatically change the competitive environment and require significant changes and costs for NMS to remain competitive. There isno assurance that NMS or Premier will have the capability to stay competitive with such changes.NMS and others in the payment processing industry have come under increasing pressures from various regulatory agencies seeking to use the leverage ofthe payment processing business to limit or modify the practices of merchants which could lead to increased costs.Various agencies, particularly the Federal Trade Commission, have within the past few years attempted to pressure merchants to discontinue or modifyvarious sales or other practices. As a part of the payment processing industry, processors such as NMS could experience pressure and/or litigation aimed atrestricting access to credit card sales by such merchants. These efforts could cause an increase in the cost to NMS of doing business or otherwise make itsbusiness less profitable and may subject NMS to assess penalties for not taking actions deemed sufficiently aggressive to limit such practices.Increased regulatory focus on the payments industry may result in costly new compliance burdens on NMS’ clients and on NMS itself, leading to increasedcosts and decreased payments volume and revenues.Regulation of the payments industry has increased significantly in recent years. Complying with these and other regulations increases costs and can reducerevenue opportunities. Similarly, the impact of such regulations on clients may reduce the volume of payments processed. Moreover, such regulations canlimit the types of products and services that are offered. Any of these occurrences can materially and adversely affect NMS’ business, prospects for futuregrowth, financial condition and results of operations.Examples include:•Data Protection and Information Security. Aspects of NMS’ operations and business are subject to privacy and data protection regulation. NMS’financial institution clients are subject to similar requirements under the guidelines issued by the federal banking agencies. In addition, manyindividual states have enacted legislation requiring consumer notification in the event of a security breach.•Anti-Money Laundering and Anti-Terrorism Financing. The U.S.A. PATRIOT Act requires NMS to maintain an anti-money laundering program.Sanctions imposed by the U.S. Treasury Office of Foreign Assets Control, or OFAC, restrict NMS from dealing with certain parties considered to beconnected with money laundering, terrorism or narcotics. NMS has controls in place designed to ensure OFAC compliance, but if those controlsshould fail, it could be subject to penalties, reputational damage and loss of business.•Money Transfer Regulations. As NMS expands its product offerings, it may become subject to money transfer regulations, increasing regulatoryoversight and costs of compliance.•Formal Investigation. If NMS is suspected of violating government statutes, such as the Federal Trade Commission Act or the Telemarketing andConsumer Fraud and Abuse Prevention Act, governmental agencies may formally55Table of Contentsinvestigate NMS. As a result of such a formal investigation, criminal or civil charges could be filed against NMS and it could be required to paysignificant fines or penalties in connection with such investigation or other governmental investigations. Any criminal or civil charges by agovernmental agency, including any fines or penalties, could materially harm NMS’ business, results of operations, financial position and cashflows. Currently, NMS is operating under an order for injunctive relief it voluntarily entered into with the Federal Trade Commission.RISKS RELATED TO OUR CONTROLLED PORTFOLIO COMPANIES - NEWTEK TECHNOLOGY SOLUTIONS (NTS)NTS operates in a highly competitive industry in which technological change can be rapid.The information technology business and its related technology involve a broad range of rapidly changing technologies. NTS equipment and thetechnologies on which it is based may not remain competitive over time, and others may develop superior technologies that render its products non-competitive, without significant additional capital expenditures. Some of NTS’ competitors are significantly larger and have substantially greater marketpresence as well as greater financial, technical, operational, marketing and other resources and experience than NTS. In the event that such a competitorexpends significant sales and marketing resources in one or several markets, NTS may not be able to compete successfully in such markets. We believe thatcompetition will continue to increase, placing downward pressure on prices. Such pressure could adversely affect NTS gross margins if it is not able to reduceits costs commensurate with such price reductions. There can be no assurances that NTS will remain competitive.NTS’ technology solutions business depends on the efficient and uninterrupted operation of its computer and communications hardware systems andinfrastructure.Despite precautions taken by NTS against possible failure of its systems, interruptions could result from natural disasters, power loss, the inability to acquirefuel for its backup generators, telecommunications failure, terrorist attacks and similar events. NTS also leases telecommunications lines from local, regionaland national carriers whose service may be interrupted. NTS’ business, financial condition and results of operations could be harmed by any damage orfailure that interrupts or delays its operations. There can be no assurance that NTS’ insurance will cover all of the losses or compensate NTS for the possibleloss of clients occurring during any period that NTS is unable to provide service.NTS’ inability to maintain the integrity of its infrastructure and the privacy of confidential information would materially affect its business.The NTS infrastructure is potentially vulnerable to physical or electronic break-ins, viruses or similar problems. If its security measures are circumvented, itcould jeopardize the security of confidential information stored on NTS’ systems, misappropriate proprietary information or cause interruptions in NTS’operations. We may be required to make significant additional investments and efforts to protect against or remedy security breaches. Security breaches thatresult in access to confidential information could damage our reputation and expose us to a risk of loss or liability. The security services that NTS offers inconnection with customers’ networks cannot assure complete protection from computer viruses, break-ins and other disruptive problems. The occurrence ofthese problems may result in claims against NTS or us or liability on our part. These claims, regardless of their ultimate outcome, could result in costlylitigation and could harm our business and reputation and impair NTS’ ability to attract and retain customers.56Table of ContentsNTS could be adversely affected by information security breaches or cyber security attacks.NTS’ web and cloud services involve the storage and transmission of our customers’, employees’, and portfolio companies’ proprietary information. NTS’business relies on its digital technologies, computer and email systems, software, and networks to conduct its operations. NTS’ technologies, systems andnetworks may become the target of criminal cyber-attacks or information security breaches that could result in the unauthorized release, gathering,monitoring, misuse, loss or destruction of confidential, proprietary and other information of NTS or third parties with whom NTS deals, or otherwise disruptour or our customers’ or other third parties’ business operations. It is critical to NTS’ business strategy that its facilities and infrastructure remain secure andare perceived by the marketplace to be secure. Although NTS believes it employs appropriate security technologies (including data encryption processes,intrusion detection systems), and conducts comprehensive risk assessments and other internal control procedures to assure the security of our customers’ data,we cannot guarantee that these measures will be sufficient for this purpose. If NTS’ security measures are breached as a result of third-party action, employeeerror or otherwise, and as a result, its customers’ data becomes available to unauthorized parties, NTS and our other portfolio companies could incur liabilityand its reputation would be damaged, which could lead to the loss of current and potential customers. If NTS experiences any breaches of its network securityor sabotage, NTS might be required to expend significant capital and other resources to detect, remedy, protect against or alleviate these and relatedproblems, and it may not be able to remedy these problems in a timely manner, or at all. Because techniques used by outsiders to obtain unauthorizednetwork access or to sabotage systems change frequently and generally are not recognized until launched against a target, NTS may be unable to anticipatethese techniques or implement adequate preventative measures. For example, an unauthorized third party recently misappropriated three of NTS’ domainnames. NTS’ management is investigating the incident. As cyber threats continue to evolve, NTS may be required to expend significant additional resourcesto continue to modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities. Although NTS hasinsurance in place that covers such incidents, the cost of a breach or cyber-attack could well exceed any such insurance coverage.NTS’ business depends on Microsoft Corporation and others for the licenses to use software as well as other intellectual property in the managedtechnology solutions business.NTS’ managed technology business is built on technological platforms relying on the Microsoft Windows® products and other intellectual property thatNTS currently licenses. As a result, if NTS is unable to continue to have the benefit of those licensing arrangements or if the products upon which its platformis built become obsolete, its business could be materially and adversely affected.RISKS RELATED TO OUR CONTROLLED PORTFOLIO COMPANIES - NEWTEK INSURANCE AGENCY (NIA)NIA depends on third parties, particularly property and casualty insurance companies, to supply the products marketed by its agents.NIA contracts with property and casualty insurance companies typically provide that the contracts can be terminated by the supplier without cause. NIA’sinability to enter into satisfactory arrangements with these suppliers or the loss of these relationships for any reason would adversely affect the results of itsinsurance business. Also, NIA’s inability to obtain these products at competitive prices could make it difficult for it to compete with larger and bettercapitalized providers of such insurance services.If NIA fails to comply with government regulations, its insurance agency business would be adversely affected.NIA insurance agency business is subject to comprehensive regulation in the various states in which it conducts business. NIA’s success will depend in partupon its ability to satisfy these regulations and to obtain and maintain all required licenses and permits. NIA’s failure to comply with any statutes andregulations could have a material adverse effect on it. Furthermore, the adoption of additional statutes and regulations, changes in the interpretation andenforcement of current statutes and regulations could have a material adverse effect on it.NIA does not have any control over the commissions it earns on the sale of insurance products which are based on premiums and commission rates set byinsurers and the conditions prevalent in the insurance market.NIA earns commissions on the sale of insurance products. Commission rates and premiums can change based on the prevailing economic and competitivefactors that affect insurance underwriters. In addition, the insurance industry has been characterized by periods of intense price competition due to excessiveunderwriting capacity and periods of favorable premium levels due to57Table of Contentsshortages of capacity. We cannot predict the timing or extent of future changes in commission rates or premiums or the effect any of these changes will haveon the operations of NIA.RISKS RELATED TO OUR CONTROLLED PORTFOLIO COMPANIES - NEWTEK PAYROLL AND BENEFIT SOLUTIONS (NPS)Unauthorized disclosure of employee data, whether through a cyber-security breach of our computer systems or otherwise, could expose NPS to liabilityand business losses.NPS collects and stores sensitive data about individuals in order to process the transactions and for other internal processes. If anyone penetrates its networksecurity or otherwise misappropriates sensitive individual data, NPS could be subject to liability or business interruption. NPS is subject to laws and rulesissued by different agencies concerning safeguarding and maintaining the confidentiality of this information. Its activities have been, and will continue tobe, subject to an increasing risk of cyber-attacks, the nature of which is continually evolving. Cyber-security risks include unauthorized access to privilegedand sensitive customer information, including passwords and account information of NPS’ customers. While it subjects its data systems to periodicindependent testing and review, NPS cannot guarantee that its systems will not be penetrated in the future. Experienced computer programmers and hackersmay be able to penetrate NPS’ network security, and misappropriate or compromise our confidential information, create system disruptions, or causeshutdowns. As a result, NPS’ customers’ information may be lost, disclosed, accessed or taken without its customers’ consent. If a breach of NPS’ systemoccurs, it may be subject to liability, including claims for impersonation or other similar fraud claims. In the event of any such breach, NPS may also besubject to a class action lawsuit. Any significant violations of data privacy could result in the loss of business, litigation and regulatory investigations andpenalties that could damage NPS’ reputation, and the growth of its business could be adversely affected.NPS is subject to risks surrounding Automated Clearing House (“ACH”) payments.Credit risk in ACH payments arises when a party to a contract fails to deposit funds required to settle the contract. This can occur if a client of NPS sufferslosses, enters into bankruptcy or defrauds NPS. In such an event, NPS could bear the financial burden of settling the customer’s contract.NPS’ systems may be subject to disruptions that could adversely affect its business and reputation.NPS’ payroll business relies heavily on its payroll, financial, accounting and other data processing systems. If any of these systems or any of the vendorswhich supply them fails to operate properly or becomes disabled even for a brief period of time, NPS could suffer financial loss, a disruption of its business,liability to clients, regulatory intervention or damage to its reputation. NPS has disaster recovery plans in place to protect its businesses against naturaldisasters, security breaches, military or terrorist actions, power or communication failures or similar events. Despite NPS’ preparations, its disaster recoveryplans may not be successful in preventing the loss of client data, service interruptions, and disruptions to its operations or damage to its important facilities.If NPS fails to adapt its technology to meet client needs and preferences, the demand for its services may diminish.NPS operates in industries that are subject to rapid technological advances and changing client needs and preferences. In order to remain competitive andresponsive to client demands, NPS continually upgrades, enhances and expands its existing solutions and services. If NPS fails to respond successfully totechnological challenges, the demand for its services may diminish.NPS could incur unreimbursed costs or damages due to delays in processing inherent in the banking system.NPS generally determines the availability of customer (employer) funds prior to making payments to employees or taxing authorities, and such employerfunds are generally transferred in to its accounts prior to making payments out. Due to the structure of the banking system however, there are times when NPSmay make payroll or tax payments and not immediately receive the funds to do so from the employer. There can be no assurance that the procedures NPS hasin place to prevent these occurrences or mitigate the damages will be sufficient to prevent loss to its business. In addition, NPS could incur unreimbursedcosts or damages due to delays in processing customer payrolls or payroll taxes in a timely manner.58Table of ContentsRISKS RELATED TO OUR CONTROLLED PORTFOLIO COMPANIES - NEWTEK BUSINESS CREDIT SOLUTIONS (NBCS)An unexpected level of defaults in NBCS’s accounts receivables, inventory or SBA 504 loan portfolios would reduce its income and increase its expenses.If NBCS’ level of non-performing assets in its receivable financing, inventory financing or SBA 504 lending business rises in the future, it could adverselyaffect its revenue, earnings and cash flow. Non-performing assets primarily consist of receivables for which the customer has not made timely payment. Incertain situations, NBCS may restructure the receivable to permit such a customer to have smaller payments over a longer period of time. Such a restructuringor non-payment by a receivables or inventory customer will result in lower revenue and less cash available for NBCS’ operational activities.NBCS’ reserve for credit losses may not be sufficient to cover unexpected losses.NBCS’ business depends on the behavior of its customers. In addition to its credit practices and procedures, NBCS maintains a reserve for credit losses on itsaccounts receivable and inventory portfolios, which it has judged to be adequate given the receivables it purchases. NBCS periodically reviews its reserve foradequacy considering current economic conditions and trends, charge-off experience and levels of non-performing assets, and adjusts its reserve accordingly.However, because of recent unstable economic conditions, its reserves may prove inadequate, which could have a material adverse effect on its financialcondition and results of operations.NBCS depends on outside financing to support its receivables financing and inventory financing business.NBCS’ receivables and inventory financing business depends on outside financing to support its acquisition of receivables. Termination of the credit linesfor any reason would have a material adverse effect on its business, including but not limited to, the liquidation of its receivables portfolios to pay down thelines. If funds from such sale were insufficient to completely pay down the line of credit, NBCS would be responsible for any short fall. We are a guarantor onthe Sterling Receivable and Inventory Facility at NBCS. Maximum borrowings under the Sterling Receivable and Inventory Facility are $15,000,000. TheSterling Receivable and Inventory Facility matures in February 2019 and automatically renews annually. At December 31, 2017, total principal owed byNBCS was $11,164,000. NBCS also entered into the Sterling 504 Facility. We are also a guarantor on the Sterling 504 Facility. Maximum borrowings underthe Sterling 504 Facility are $35,000,000, depending on syndication. The Sterling 504 Facility matures in August 2018. At December 31, 2017, totalprincipal owed by NBCS was $8,597,000. The Sterling 504 Facility specifies certain events of default, pursuant to which all outstanding amounts under theSterling 504 Facility could become immediately due and payable.We have guaranteed NBCS’ obligations under both facilities. If NBCS defaults on these lines of credit, we would be required to make payments under theguarantees, which could have a material adverse effect on our financial condition and results of operations.In addition, if NBCS loses either of these lines of credit and NBCS is unable to renew or replace these lines of credit, it would materially impact the businessof NBCS and have a material adverse effect on its financial condition and results of operations.LEGAL PROCEEDINGS - PORTFOLIO COMPANIESOur portfolio companies may, from time to time, be involved in various legal matters, including the currently pending case — Federal Trade Commissionv. WV Universal Management, LLC et al., which may have an adverse effect on their operations and/or financial condition.During the quarter ended June 30, 2013, the Federal Trade Commission (the “FTC”) amended an existing complaint in the matter Federal Trade Commissionv. WV Universal Management, LLC et al., in the United States District Court for the Middle District of Florida (the “Court”), to add UPSW as an additionaldefendant on one count of providing substantial assistance in violation of the Telemarketing Sales Rule. On November 18, 2014, the Court issued an Ordergranting the FTC’s motion for summary judgment against UPSW on the single count. Subsequently, the FTC filed motions for a permanent injunction andequitable monetary relief against UPSW and the other remaining defendants. Prior to the Court hearing on the motions, UPSW and the FTC reached asettlement on the FTC’s motion for a permanent injunction. On May 19, 2015, the Court entered an equitable monetary judgment against UPSW for$1,735,000. The $1,735,000 was fully expensed in 2014 by UPSW.On June 14, 2016, the United States Court of Appeals for the Eleventh Circuit vacated the Court’s order awarding joint and several liability for equitablemonetary relief in the amount of $1,735,000 against UPSW, and remanded the case to the Court59Table of Contentsfor findings of fact and conclusions of law as to whether and why UPSW should be jointly and severally liable for restitution, and in what amount, if any. OnOctober 26, 2016, the Court entered an equitable monetary judgment against UPSW for $1,735,000. On December 13, 2017, the United States Court ofAppeals for the Eleventh Circuit affirmed the Court’s order awarding joint and several liability for equitable monetary relief against UPSW. UPSW intends tofile a petition for a writ of certiorari requesting that the United States Supreme Court review the judgment.UPSW instituted an action against a former independent sales agent in Wisconsin state court for, among other things, breach of contract. The former salesagent answered the complaint and filed counterclaims against UPSW. Following UPSW’s successful appeal of several of the court’s rulings, the action hasbeen assigned to a new judge for further proceedings. UPSW intends to vigorously pursue its claims against the former sales agent and defend thecounterclaims asserted.On October 13, 2017, the Company announced that its portfolio company, BSP, was served with a search warrant by the Federal Bureau of Investigation(“FBI”) on October 12, 2017 at BSP offices in Westfield, Indiana. The Company closed on its $5,400,000 investment in BSP in June 2016. During the yearended December 31, 2017, the Company recorded a $2,000,000 unrealized loss on its investment in BSP to reflect the potential impact to the business andtradename as a result of the FBI investigation. The Company is monitoring the situation and is cooperating fully with the authorities.RISKS RELATED TO OUR CAPCO BUSINESSThe Capco programs and the tax credits they provide are created by state legislation and implemented through regulation, and such laws and rules aresubject to possible action to repeal or retroactively revise the programs for political, economic or other reasons. Such an attempted repeal or revisionwould create substantial difficulty for the Capco programs and could, if ultimately successful, cause us material financial harm.The tax credits associated with the Capco programs and provided to our Capcos’ investors are to be utilized by the investors over a period of time, which istypically ten years. Much can change during such a period and it is possible that one or more states may revise or eliminate the tax credits. Any such revisionor repeal could have a material adverse economic impact on our Capcos, either directly or as a result of the Capco’s insurer’s actions. Any such final stateaction that jeopardizes the tax credits could result in the provider of our Capco insurance assuming partial or full control of the particular Capco in order tominimize its liability under the Capco insurance policies issued to our investors.Because our Capcos are subject to requirements under state law, a failure of any of them to meet these requirements could subject the Capco and ourshareholders to the loss of one or more Capcos.Despite the fact that we have met all applicable minimum requirements of the Capco programs in which we still participate, each Capco remains subject tostate regulation until it has invested 100% of its funds and otherwise remains in full legal compliance. There can be no assurance that we will continue to beable to do so. A major regulatory violation, while not fatal to our Capco business, would materially increase the cost of operating the Capcos.We know of no other publicly-held company that sponsors and operates Capcos as a part of its business. As such, there are, to our knowledge, no othercompanies against which investors may compare our Capco business and its operations, results of operations and financial and accounting structures.In the absence of any meaningful peer group comparisons for our Capco business, investors may have a difficult time understanding and judging the strengthof our business. This, in turn, may have a depressing effect on the value of our stock.RISKS RELATED TO OUR SECURITIESAs of December 31, 2017, our CEO beneficially owns approximately 5% of our common stock, and may be able to exercise significant influence over theoutcome of most shareholder actions.Because of his ownership of our stock, Barry Sloane, our Chairman, Chief Executive Officer and President, may be able to exercise significant influence overactions requiring shareholder approval, including the election of directors, the adoption of amendments to the certificate of incorporation, approval of stockincentive plans and approval of major transactions such as a merger or sale of assets. This could delay or prevent a change in control of the Company, depriveour shareholders of an opportunity to receive a premium for their common stock as part of a change in control and have a negative effect on the market priceof our common stock.60Table of ContentsOur common stock price may be volatile and may decrease substantially.The trading price of our common stock may fluctuate substantially. The price of our common stock may be higher or lower depending on many factors, someof which are beyond our control and may not be directly related to our operating performance. These factors include, but are not limited to, the following:•price and volume fluctuations in the overall stock market from time to time;•investor demand for our stock;•significant volatility in the market price and trading volume of securities of BDCs or other companies in our sector, which are not necessarily relatedto the operating performance of these companies;•changes in regulatory policies or tax guidelines with respect to RICs, BDCs, or SBLCs;•failure to qualify as a RIC, or the loss of RIC status;•any shortfall in revenue or net income or any increase in losses from levels expected by investors or securities analysts;•changes, or perceived changes, in the value of our portfolio investments;•departures of key Company personnel;•operating performance of companies comparable to us; or•general economic conditions and trends and other external factors.In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been brought against thatcompany. Due to the potential volatility of our stock price once a market for our stock is established, we may become the target of securities litigation in thefuture. Securities litigation could result in substantial costs and divert management’s attention and resources from our business.Future issuances of our common stock or other securities, including preferred shares, may dilute the per share book value of our common stock or haveother adverse consequences to our common shareholders.Our Board has the authority, without the action or vote of our shareholders, to issue all or part of the approximately 181,543,205 authorized but unissuedshares of our common stock. Our business strategy relies upon investments in and acquisitions of businesses using the resources available to us, including ourcommon stock. Additionally, we anticipate granting additional options or restricted stock awards to our employees and directors in the future. Absentexemptive relief, a BDC generally may not issue restricted stock to its directors, officers and employees. In May 2016, the SEC issued an order granting theCompany’s request for exemptive relief to allow us to amend our equity compensation plan and make such grants and awards, subject to shareholderapproval. We may also issue additional securities, through public or private offerings, in order to raise capital. Future issuances of our common stock willdilute the percentage of ownership interest of current shareholders and could decrease the per share book value of our common stock. In addition, optionholders may exercise their options at a time when we would otherwise be able to obtain additional equity capital on more favorable terms. In July 2016, ourshareholders approved the amendments to our equity compensation plan, and certain restricted stock awards granted thereunder.We may also issue additional securities, through public or private offerings, in order to raise capital. Future issuances of our common stock will dilute thepercentage of ownership interest of current shareholders and could decrease the per share book value of our common stock. In addition, option holders mayexercise their options at a time when we would otherwise be able to obtain additional equity capital on more favorable terms.Pursuant to our amended and restated charter, our Board is authorized to classify any unissued shares of stock and reclassify any previously classified butunissued shares of stock of any class or series from time to time, into one or more classes or series of stock, including preferred stock. If we issue preferredstock, the preferred stock would rank “senior” to common stock in our capital structure, preferred shareholders would have separate voting rights on certainmatters and might have other rights, preferences, or privileges more favorable than those of our common shareholders, and the issuance of preferred stockcould have the effect of delaying, deferring or preventing a transaction or a change of control that might involve a premium price for61Table of Contentsholders of our common stock or otherwise be in your best interest. We will not generally be able to issue and sell our common stock at a price below net assetvalue per share. We may, however, sell our common stock, or warrants, options or rights to acquire our common stock, at a price below the then current netasset value per share of our common stock if our Board determines that such sale is in our best interests and in the best interests of our shareholders, and ourshareholders approve such sale. In any such case, the price at which our securities are to be issued and sold may not be less than a price that, in thedetermination of our Board, closely approximates the market value of such securities (less any distributing commission or discount). If we raise additionalfunds by issuing more common stock or senior securities convertible into, or exchangeable for, our common stock, then the percentage ownership of ourshareholders at that time will decrease, and you may experience dilution.Our shareholders may experience dilution upon the repurchase of common shares.The Company has instituted programs which allow the Company to repurchase the Company’s outstanding common shares on the open market. Under theprograms, purchases may be made at management’s discretion from time to time in open-market transactions, in accordance with all applicable securities lawsand regulations. On May 11, 2016, the Company announced that its Board approved a new share repurchase program under which the Company was able torepurchase up to 150,000 of the Company’s outstanding common shares on the open market. This program terminated on November 11, 2016. On November21, 2016 the Company announced that its Board approved a new share repurchase program under which the Company may repurchase up to 200,000 of theCompany’s outstanding common shares on the open market. The program terminated on May 21, 2017 but our Board may authorize a new repurchaseprogram in the future.The authorization and issuance of “blank check” preferred shares could have an anti-takeover effect detrimental to the interests of our shareholders.Our certificate of incorporation allows our Board to issue preferred shares with rights and preferences set by the Board without further shareholder approval.The issuance of these “blank check” preferred shares could have an anti-takeover effect detrimental to the interests of our shareholders. For example, in theevent of a hostile takeover attempt, it may be possible for management and the Board to impede the attempt by issuing the preferred shares, thereby dilutingor impairing the voting power of the other outstanding common shares and increasing the potential costs to acquire control of us. Our Board has the right toissue any new shares, including preferred shares, without first offering them to the holders of common shares, as they have no preemptive rights. TheCompany does not currently intend to issue preferred shares.Our business and operation could be negatively affected if we become subject to any securities litigation or shareholder activism, which could cause us toincur significant expense, hinder execution of investment strategy and impact our stock price. In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been brought against thatcompany. Stockholder activism, which could take many forms or arise in a variety of situations, has been increasing in the BDC space recently. While we arecurrently not subject to any securities litigation or shareholder activism, due to the potential volatility of our stock price and for a variety of other reasons, wemay in the future become the target of securities litigation or shareholder activism. Securities litigation and shareholder activism, including potential proxycontests, could result in substantial costs and divert management’s and our board of directors’ attention and resources from our business. Additionally, suchsecurities litigation and shareholder activism could give rise to perceived uncertainties as to our future, adversely affect our relationships with serviceproviders and make it more difficult to attract and retain qualified personnel. Also, we may be required to incur significant legal fees and other expensesrelated to any securities litigation and activist shareholder matters. Further, our stock price could be subject to significant fluctuation or otherwise beadversely affected by the events, risks and uncertainties of any securities litigation and shareholder activism.Provisions of the Maryland General Corporation Law and of our charter and bylaws could deter takeover attempts and have an adverse impact on theprice of our common stock.The Maryland General Corporation Law and our charter and bylaws contain provisions that may discourage, delay or make more difficult a change in controlof Newtek or the removal of our directors. We are subject to the Maryland Business Combination Act, subject to any applicable requirements of the 1940 Act.Our Board has adopted a resolution exempting from the Business Combination Act any business combination between us and any other person, subject toprior approval of such business combination by our Board, including approval by a majority of our independent directors. If the resolution exemptingbusiness combinations is repealed or our Board does not approve a business combination, the Business Combination Act may discourage third parties fromtrying to acquire control of us and increase the difficulty of consummating such an offer. Our bylaws exempt from the Maryland Control Share AcquisitionAct acquisitions of our stock by any person.62Table of ContentsThe SEC staff has taken the position that, under the 1940 Act, an investment company may not avail itself of the Control Share Act. As a result, we willamend our bylaws to be subject to the Control Share Act only if the board of directors determines that it would be in our best interests and, after notification,the SEC staff does not object to our determination that our being subject to the Control Share Act does not conflict with the 1940 Act. If such conditions aremet, and we amend our bylaws to repeal the exemption from the Control Share Acquisition Act, the Control Share Acquisition Act also may make it moredifficult for a third party to obtain control of us and increase the difficulty of consummating such a transaction.We have also adopted measures that may make it difficult for a third party to obtain control of us, including provisions of our charter classifying our Board inthree classes serving staggered three-year terms and authorizing our Board to classify or reclassify shares of our stock in one or more classes or series, to causethe issuance of additional shares of our stock, to amend our charter without shareholder approval and to increase or decrease the number of shares of stockthat we have authority to issue. These provisions, as well as other provisions of our charter and bylaws, may delay, defer or prevent a transaction or a changein control that might otherwise be in the best interests of our shareholders.Sales of substantial amounts of our common stock in the public market may have an adverse effect on the market price of our common stock.All of the common stock held by our executive officers and directors, represents approximately 1,138,000 shares, or approximately 6% of our totaloutstanding shares as of December 31, 2017. Such shares are generally freely tradable in the public market. Sales of substantial amounts of our commonstock, or the availability of such common stock for sale, could adversely affect the prevailing market prices for our common stock. If this occurs andcontinues, it could impair our ability to raise additional capital through the sale of securities should we desire to do so.If we issue preferred stock, the net asset value and market value of our common stock will likely become more volatile.We cannot assure you that the issuance of preferred stock would result in a higher yield or return to the holders of our common stock. The issuance ofpreferred stock would likely cause the net asset value and market value of the common stock to become more volatile. If the dividend rate on the preferredstock were to approach the net rate of return on our investment portfolio, the benefit of leverage to the holders of the common stock would be reduced. If thedividend rate on the preferred stock were to exceed the net rate of return on our portfolio, the leverage would result in a lower rate of return to the holders ofcommon stock than if we had not issued preferred stock. Any decline in the net asset value of our investments would be borne entirely by the holders ofcommon stock. Therefore, if the market value of our portfolio were to decline, the leverage would result in a greater decrease in net asset value to the holdersof common stock than if we were not leveraged through the issuance of preferred stock. This greater net asset value decrease would also tend to cause agreater decline in the market price for the common stock. We might be in danger of failing to maintain the required asset coverage of the preferred stock or oflosing our ratings, if any, on the preferred stock or, in an extreme case, our current investment income might not be sufficient to meet the dividendrequirements on the preferred stock. To counteract such an event, we might need to liquidate investments to fund a redemption of some or all of the preferredstock. In addition, we would pay (and the holders of common stock would bear) all costs and expenses relating to the issuance and ongoing maintenance ofthe preferred stock, including higher advisory fees if our total return exceeds the dividend rate on the preferred stock. Holders of preferred stock may havedifferent interests than holders of common stock and may at times have disproportionate influence over our affairs.Stockholders may incur dilution if we sell shares of our common stock in one or more offerings at prices below the then current net asset value per share ofour common stock or issue securities to subscribe to, convert to or purchase shares of our common stock.The 1940 Act prohibits us from selling shares of our common stock at a price below the current net asset value per share of such stock, with certainexceptions. One such exception is prior shareholder approval of issuances below net asset value provided that our Board makes certain determinations. OnAugust 11, 2017, at our Special Meeting of Shareholders, our shareholders approved a proposal that authorizes us to sell up to 20% of our common stock at aprice below the Company’s then-current net asset value per share, subject to certain conditions. Any decision to sell shares of our common stock below thethen current net asset value per share of our common stock or securities to subscribe to, convert to, or purchase shares of our common stock would be subjectto the determination by our Board that such issuance is in our and our shareholders’ best interests.If we were to sell shares of our common stock below net asset value per share, such sales would result in an immediate dilution to the net asset value per share.This dilution would occur as a result of the sale of shares at a price below the then current net asset value per share of our common stock and aproportionately greater decrease in a shareholder’s interest in our earnings and assets and voting interest in us than the increase in our assets resulting fromsuch issuance. In addition, if we issue securities to subscribe to, convert to or purchase shares of common stock, the exercise or conversion of such securitieswould increase the63Table of Contentsnumber of outstanding shares of our common stock. Any such exercise would be dilutive on the voting power of existing shareholders, and could be dilutivewith regard to dividends and our net asset value, and other economic aspects of the common stock. Because the number of shares of common stock that couldbe so issued and the timing of any issuance is not currently known, the actual dilutive effect cannot be predicted; however, the example below illustrates theeffect of dilution to existing shareholders resulting from the sale of common stock at prices below the net asset value of such shares.RISKS RELATED TO OUR PUBLICLY-TRADED DEBTThe 2022 Notes, 2021 Notes, and 2023 Notes, together, the “Notes” are unsecured and therefore are effectively subordinated to any secured indebtednesswe have outstanding or may incur in the future.In September 2015 and April 2016, we issued $8,324,000 and $40,250,000 in aggregate principal amount of the 2022 Notes and 2021 Notes, respectively.The Notes are not secured by any of our assets or any of the assets of our subsidiaries. As a result, the Notes are effectively subordinated to any securedindebtedness we or our subsidiaries have outstanding or may incur in the future (or any indebtedness that is initially unsecured to which we subsequentlygrant security). In any liquidation, dissolution, bankruptcy or other similar proceeding, the holders of any of our existing or future secured indebtedness andthe existing or future secured indebtedness of our subsidiaries may assert rights against the assets pledged to secure that indebtedness to receive full paymentof their indebtedness before the assets may be used to pay other creditors, including the holders of the Notes.In addition, on February 21, 2018, we closed an underwritten public offering of $50,000,000 in aggregate principal amount of the 2023 Notes. Pursuant tothe underwriters’ overallotment option, we closed an additional $7,500,000 in aggregate principal amount of the 2023 Notes. For more information regardingthe 2023 Notes, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Liquidity and Capital Resources”.The Notes are structurally subordinated to the indebtedness and other liabilities of our subsidiaries.The Notes are obligations exclusively of the Company and not of any of our subsidiaries. None of our subsidiaries is a guarantor of the Notes and the Notesare not required to be guaranteed by any subsidiaries we may acquire or create in the future. Any assets of our subsidiaries will not be directly available tosatisfy the claims of our creditors, including holders of the Notes.Except to the extent we are a creditor with recognized claims against our subsidiaries, all claims of creditors (including trade creditors) and holders ofpreferred stock, if any, of our subsidiaries will have priority over our equity interests in such subsidiaries (and therefore the claims of our creditors, includingholders of the Notes) with respect to the assets of such subsidiaries. Even if we are recognized as a creditor of one or more of our subsidiaries, our claimswould still be effectively subordinated to any security interests in the assets of any such subsidiary and to any indebtedness or other liabilities of any suchsubsidiary senior to our claims. Consequently, the Notes are structurally subordinated to all indebtedness and other liabilities (including trade payables) ofany of our subsidiaries and any subsidiaries that we may in the future acquire or establish as financing vehicles or otherwise.The indenture under which the Notes were issued contains limited protection for holders of the Notes.The indentures under which the Notes were issued offers limited protection to holders of the Notes. The terms of the indentures and the Notes do not restrictour or any of our subsidiaries’ ability to engage in, or otherwise be a party to, a variety of corporate transactions, circumstances or events that could have amaterial adverse impact on your investment in the Notes. In particular, the terms of the indentures and the Notes do not place any restrictions on our or oursubsidiaries’ ability to:•issue securities or otherwise incur additional indebtedness or other obligations, including (1) any indebtedness or other obligations that would beequal in right of payment to the Notes, (2) any indebtedness or other obligations that would be secured and therefore rank effectively senior in rightof payment to the Notes, (3) indebtedness of ours that is guaranteed by one or more of our subsidiaries and which therefore is structurally senior tothe Notes and (4) securities, indebtedness or obligations issued or incurred by our subsidiaries that would be senior to our equity interests in oursubsidiaries and therefore rank structurally senior to the Notes with respect to the assets of our subsidiaries, in each case other than an incurrence ofindebtedness or other obligation that would cause a violation of Section 18(a)(1)(A) as modified by Section 61(a)(1) of the 1940 Act or anysuccessor provisions, whether or not we continue to be subject to such provisions of the 1940 Act, but giving effect, in either case, to any exemptiverelief granted to us by the SEC. Currently, these provisions generally prohibit us from making additional borrowings, including through the issuanceof64Table of Contentsadditional debt or the sale of additional debt securities, unless our asset coverage, as defined in the 1940 Act, equals at least 200% after suchborrowings;•with respect to the 2021 Notes, pay dividends on, or purchase or redeem or make any payments in respect of, capital stock or other securities rankingjunior in right of payment to the 2021 Notes, including subordinated indebtedness, in each case other than dividends, purchases, redemptions orpayments that would cause a violation of Section 18(a)(1)(B) as modified by Section 61(a)(1) of the 1940 Act as in effect immediately prior to theissuance of the 2021 Notes, we will not declare any dividend (except a dividend payable in stock of the issuer), or declare any other distribution,upon a class of the capital stock of the Company, or purchase any such capital stock, unless, in every such case, at the time of the declaration of anysuch dividend or distribution, or at the time of any such purchase, the Company has an asset coverage (as defined in the 1940 Act) of at least 200%after deducting the amount of such dividend, distribution or purchase price, as the case may be, and giving effect, in each case, (i) to any exemptiverelief granted to the Company by the SEC and (ii) to any no-action relief granted by the SEC to another business development company (or to theCompany if it determines to seek such similar no-action or other relief) permitting the business development company to declare any cash dividendor distribution notwithstanding the prohibition contained in Section 18(a)(1)(B) as modified by Section 61(a)(1) of the 1940 Act in order tomaintain such business development company’s status as a regulated investment company under Subchapter M of the Internal Revenue Code of1986, as amended;•with respect to the 2022 Notes, pay dividends on, or purchase or redeem or make any payments in respect of, capital stock or other securities rankingjunior in right of payment to the Notes, including subordinated indebtedness, in each case other than dividends, purchases, redemptions or paymentsthat would cause a violation of Section 18(a)(1)(B) as modified by Section 61(a)(1) of the 1940 Act or any successor provisions, giving effect to (i)any exemptive relief granted to us by the SEC and (ii) no-action relief granted by the SEC to another BDC (or to the Company if it determines toseek such similar no-action or other relief) permitting the BDC to declare any cash dividend or distribution notwithstanding the prohibitioncontained in Section 18(a)(1)(B) as modified by Section 61(a)(1) of the 1940 Act in order to maintain the BDC’s status as a RIC under Subchapter Mof the Code (these provisions generally prohibit us from declaring any cash dividend or distribution upon any class of our capital stock, orpurchasing any such capital stock if our asset coverage, as defined in the 1940 Act, is below 200% at the time of the declaration of the dividend ordistribution or the purchase and after deducting the amount of such dividend, distribution or purchase);•sell assets (other than certain limited restrictions on our ability to consolidate, merge or sell all or substantially all of our assets);•enter into transactions with affiliates;•create liens (including liens on the shares of our subsidiaries) or enter into sale and leaseback transactions;•make investments; or•create restrictions on the payment of dividends or other amounts to us from our subsidiaries.In addition, the indentures does not require us to offer to purchase the Notes in connection with a change of control, asset sale or any other event.Furthermore, the terms of the indentures and the Notes do not protect holders of the Notes in the event that we experience changes (including significantadverse changes) in our financial condition, results of operations or credit ratings, as they do not require that we or our subsidiaries adhere to any financialtests or ratios or specified levels of net worth, revenues, income, cash flow or liquidity. Our ability to recapitalize, incur additional debt and take a number ofother actions that are not limited by the terms of the Notes may have important consequences for you as a holder of the Notes, including making it moredifficult for us to satisfy our obligations with respect to the Notes or negatively affecting the trading value of the Notes.Other debt we issue or incur in the future could contain more protections for its holders than the indentures and the Notes, including additional covenantsand events of default. The issuance or incurrence of any such debt with incremental protections could affect the market for and trading levels and prices of theNotes.If we default on our obligations to pay other indebtedness that we may incur in the future, we may not be able to make payments on the Notes.In the future, we may enter into agreements to incur additional indebtedness, including a secured credit facility. A default under such agreements to which wemay be a party that is not waived by the required lenders or holders, and the remedies sought by65Table of Contentsthe holders of such indebtedness could make us unable to pay principal, premium, if any, and interest on the Notes and substantially decrease the marketvalue of the Notes. If we are unable to generate sufficient cash flow and are otherwise unable to obtain funds necessary to meet required payments ofprincipal, premium, if any, and interest on such future additional indebtedness, or if we otherwise fail to comply with the various covenants, includingfinancial and operating covenants, in the instruments governing such future additional indebtedness, we could be in default under the terms of theagreements governing such indebtedness. In the event of such default, the holders of such indebtedness could elect to declare all the funds borrowedthereunder to be due and payable, together with accrued and unpaid interest, the lenders of other debt we may incur in the future could elect to terminate theircommitments, cease making further loans and institute foreclosure proceedings against our assets, and we could be forced into bankruptcy or liquidation. Ifwe are unable to repay debt, lenders having secured obligations could proceed against the collateral securing the debt. Because any future credit facilitieslikely will have customary cross-default provisions, if the indebtedness under any future credit facility is accelerated, we may be unable to repay or financethe amounts due.We may choose to redeem the Notes when prevailing interest rates are relatively low.On or after April 22, 2017 and September 23, 2018, we may choose to redeem the 2021 Notes and the 2022 Notes, respectively, from time to time, especiallywhen prevailing interest rates are lower than the interest rate on the 2021 Notes or 2022 Notes. If prevailing rates are lower at the time of redemption, you maynot be able to reinvest the redemption proceeds in a comparable security at an effective interest rate as high as the interest rate on the Notes being redeemed.Our redemption right also may adversely impact your ability to sell the Notes as the optional redemption date or period approaches.On November 21, 2016, the Company announced that its Board approved a repurchase program under which the Company may repurchase up to 10%, or$832,400 in aggregate principal amount, of its 2022 Notes and up to 10%, or $4,025,000 in aggregate principal amount, of its 2021 Notes through openmarket purchases, including block purchases, in such manner as will comply with the provisions of the 1940 Act and the Exchange Act. The repurchase planexpired on May 21, 2017, however, the Company may institute a new repurchase plan in the future.On February 21, 2018, the Company issued redemption notices to the holders of the 2021 Notes. The Company will redeem all $40,250,000 in aggregateprincipal amount of the 2021 Notes on the Redemption Date at 100% of their principal amount ($25 per Note), plus the accrued and unpaid interest thereonfrom December 31, 2017, through, but excluding, the Redemption Date. See Subsequent Events.The trading market or market value of our publicly traded debt securities may fluctuateThe 2022 Notes and the 2021 Notes are new issues of debt securities listed on the Nasdaq Global Market under the symbols “NEWTZ” and “NEWTL,”respectively. Although the Notes are listed on Nasdaq, we cannot assure you that a trading market for our publicly issued debt securities will be maintained.In addition to our creditworthiness, many factors may materially adversely affect the trading market for, and market value of, our publicly issued debtsecurities. These factors include, but are not limited to, the following:•the time remaining to the maturity of these debt instruments;•the outstanding principal amount of debt securities with terms identical to these debt securities;•the ratings assigned by the national statistical rating agencies;•the general economic environment;•the supply of debt securities trading in the secondary market, if any;•the level, direction and volatility of market interest rates generally; and•market rates of interest higher or lower than rates borne by the debt securities.You should be aware that there may be a limited number of buyers when you decide to sell your securities. This too may materially adversely affect themarket value of the debt securities of the trading market for the debt securities.Pending legislation may allow us to incur additional leverage.As a BDC, under the 1940 Act we generally are not permitted to incur indebtedness unless immediately after such borrowing we have an asset coverage fortotal borrowings of at least 200% (i.e., the amount of debt may not exceed 50% of the value of our assets). Pending legislation, if passed, would modify thissection of the 1940 Act and increase the amount of debt that66Table of ContentsBDCs may incur by modifying the asset coverage percentage from 200% to 150%. As a result, we may be able to incur additional indebtedness in the futureand therefore your risk of an investment in us may increase.ITEM 1B. UNRESOLVED STAFF COMMENTS.None.ITEM 2. PROPERTIES.We conduct our principal business activities in facilities leased from unrelated parties at market rates. Our headquarters are located in Lake Success, NewYork. Our operating subsidiaries have properties which are material to the conduct of their business as noted below. In addition, our Capcos maintain officesin each of the states in which they operate.Below is a list of our leased offices and space as of December 31, 2017 which are material to the conduct of our business:Location Lease expiration Purpose Approximate squarefeet 1981and 1985 Marcus AvenueLake Success, NY 11042 April 2027 Corporate headquarters and lending operations, NY Capcooffices and certain controlled portfolio companies’ offices 43,0004 Park PlazaIrvine, CA 92614 February 2021 NSBF lending operations 3,3005901 Broken Sound Parkway NWBoca Raton, FL 33487 August 2018 NSBF lending operations 3,80014 East Washington StreetOrlando, FL 32801 September 2019 NSBF lending operations 1,700We believe that our leased facilities are adequate to meet our current needs and that additional facilities are available to meet our development andexpansion needs in existing and projected target markets.ITEM 3. LEGAL PROCEEDINGS.In the ordinary course of business, the Company and its wholly owned portfolio companies may from time to time be party to lawsuits and claims. TheCompany evaluates such matters on a case by case basis and its policy is to contest vigorously any claims it believes are without compelling merit. TheCompany is not currently involved in any litigation matters. For legal proceedings involving controlled portfolio companies, refer to “Risk Factors - LegalProceedings - Portfolio Companies.”ITEM 4. MINE SAFETY DISCLOSURES.Not applicable.67Table of ContentsPART IIITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OFEQUITY SECURITIES.Price Range of Common StockOur common stock is traded on the Nasdaq Global Market under the symbol “NEWT.” High and low prices for the common stock over the previous two yearsare set forth below, based on the highest and lowest intraday sales price per share during that period. Price Range High Low2016 First Quarter$14.51 $9.37Second Quarter$13.36 $11.83Third Quarter$14.44 $12.26Fourth Quarter$16.09 $13.76 2017 First Quarter$17.58 $15.15Second Quarter$18.00 $15.68Third Quarter$18.16 $15.68Fourth Quarter$19.40 $16.01The last reported price for our common stock on March 12, 2018 was $18.59 per share. As of March 12, 2018 there were approximately 131 shareholders ofrecord.Shares of BDCs may trade at a market price that is less than the value of the net assets attributable to those shares. The possibility that our shares of commonstock will trade at a discount from net asset value or at premiums that are unsustainable over the long term are separate and distinct from the risk that our netasset value will decrease. It is not possible to predict whether our shares will trade at, above, or below net asset value. Since our conversion to a BDC, ourshares of common stock have traded at prices both less than and exceeding our NAV per share.Sales of Unregistered Securities During the year ended December 31, 2017, in connection with our investment in IPM, we issued 60,490 shares of restricted common stock.During the year ended December 31, 2017, in connection with our investment in UCS, we issued 28,741 shares of restricted common stock.During the year ended December 31, 2015, in connection with our investment in Premier, we issued 130,959 shares of restricted common stock to JeffreyRubin, a related party, in a private transaction as a portion of the consideration.We did not engage in any sales of unregistered securities during the year ended December 31, 2016.DistributionsIn order to be subject to tax as a RIC, we must distribute to our shareholders, in respect of each taxable year, dividends for U.S. federal income tax purposes ofan amount generally at least equal to the Annual Distribution Requirement. Upon satisfying this requirement in respect of a taxable year, we generally willnot be subject to corporate taxes on any income we distribute to our shareholders as dividends for U.S. federal income tax purposes.68Table of ContentsHowever, as a RIC we will be subject to a 4% nondeductible U.S. federal excise tax on certain undistributed income and gains unless we make distributionstreated as dividends for U.S. federal income tax purposes in a timely manner to our shareholders in respect of each calendar year of an amount at least equal tothe Excise Tax Avoidance Requirement. We will not be subject to this excise tax on any amount on which we incurred U.S. federal corporate income tax(such as the tax imposed on a RIC’s retained net capital gains).Depending on the level of taxable income earned in a taxable year, we may choose to carry over taxable income in excess of current taxable yeardistributions treated as dividends for U.S. federal income tax purposes from such taxable income into the next taxable year and incur a 4% excise tax on suchtaxable income, as required. The maximum amount of excess taxable income that may be carried over for distribution in the next taxable year under the Codeis the total amount of distributions treated as dividends for U.S. federal income tax purposes paid in the following taxable year, subject to certain declarationand payment guidelines. To the extent we choose to carry over taxable income into the next taxable year, distributions declared and paid by us in a taxableyear may differ from our taxable income for that taxable year as such distributions may include the distribution of current taxable year taxable income, thedistribution of prior taxable year taxable income carried over into and distributed in the current taxable year, or returns of capital.We can offer no assurance that we will achieve results that will permit the payment of any cash distributions and, if we issue senior securities, we will beprohibited from making distributions if doing so causes us to fail to maintain the asset coverage ratios stipulated by the 1940 Act or if distributions arelimited by the terms of any of our borrowings. Our ability to make distributions will be limited by the asset coverage requirements under the 1940 Act. See“Item 1. Business— Regulation.”The following table summarizes our dividend declarations and distributions to date:Record Date Payment Date Distribution DeclaredMarch 30, 2015 April 13, 2015 $0.39June 29, 2015 July 15, 2015 $0.47October 22, 2015 November 3, 2015 $0.50November 18, 2015 (1) December 31, 2015 $2.69January 7, 2016 January 19, 2016 $0.40March 22, 2016 March 31, 2016 $0.35June 20, 2016 June 30, 2016 $0.35September 20, 2016 September 30, 2016 $0.43December 15, 2016 December 30, 2016 $0.40March 20, 2017 March 31, 2017 $0.36May 31, 2017 June 30, 2017 $0.40September 22, 2017 September 29, 2017 $0.44December 18, 2017 December 28, 2017 $0.44 $7.62(1) The Special dividend was declared as a result of the Company’s RIC election for tax year 2015 and represents the distribution of 100% of the Company’saccumulated earnings and profits through December 31, 2014. Pursuant to applicable Treasury Regulation and IRS guidance, the dividend was payable up to27% in cash and at least 73% in newly issued shares of our common stock.Our Board maintains a variable distribution policy with the objective of distributing four quarterly distributions in an amount that approximates 90 - 100%of our taxable quarterly income or potential annual income for a particular taxable year. In addition, at the end of our taxable year, our Board may choose topay an additional special distribution, or fifth distribution, so that we may distribute approximately all of our annual taxable income in the taxable year inwhich it was earned, or may elect to maintain the option to spill over our excess taxable income into the following taxable year as part of any futuredistribution payments.Distributions in excess of our current and accumulated earnings and profits would generally be treated first as a return of capital to the extent of ashareholder’s tax basis in our shares, and any distributions paid in excess of a shareholder’s tax basis in our shares would generally be treated as a capitalgain. The determination of the tax attributes of our distributions is made69Table of Contentsannually as of the end of our taxable year and is generally based upon our taxable income for the full taxable year and distributions paid for the full taxableyear. Of the distributions declared during the years ended December 31, 2017 and 2016 100% were distributions derived from our current and accumulatedearnings and profits. There can be no certainty to shareholders that this determination is representative of the tax attributes of the 2018 distributions that weanticipate would be made to shareholders.We maintain an “opt-out” dividend reinvestment plan for our common shareholders. As a result, if we declare a distribution, cash distributions will beautomatically reinvested in additional shares of our common stock unless the shareholder specifically “opts out” of the dividend reinvestment plan andchooses to receive cash distributions. During the years ended December 31, 2017 and 2016, we issued 44,000 and 58,000 shares, respectively, of commonstock to shareholders in connection with the dividend reinvestment plan.Securities authorized for issuance under equity compensation plans as of December 31, 2017:Plan Category (a)Number of securities to beissued upon exercise ofoutstanding options,warrants and rights (b)Weighted-average exerciseprice of outstandingoptions, warrants andrights (c)Number of securities remainingavailable for future issuanceunder equity compensation plans(excluding securities reflected incolumn (a)) Equity compensation plans approved by security holders None None 2,874,060 shares Equity compensation plans not approved by security holders None None NoneStock Performance Graph The following graph compares the return on our common stock with that of the Standard & Poor’s 500 Stock Index, the NASDAQ Composite Index, theRussell 2000, and S&P Small Cap 600 for the period from December 31, 2012 through December 31, 2017. The graph assumes that, on January 1, 2013, aperson invested $100 in each of our common stock, the Nasdaq Composite, S&P 500 Index, Russell 2000 and S&P Small Cap 600. The graph measures totalshareholder return, which takes into account both changes in stock price and dividends. It assumes that dividends paid are invested in like securities.ITEM 6. SELECTED FINANCIAL DATA.70Table of ContentsThe following selected statements of operations and balance sheet data have been derived from the audited financial statements for each of the five yearsended December 31, 2017. The Consolidated Financial Statements for each of the five years ended December 31, 2017 have been audited by RSM US LLP.The selected financial data set forth below should be read in conjunction with, and is qualified by reference to, “Management’s Discussion and Analysis ofFinancial Condition and Results of Operations” and our Consolidated Financial Statements, including the Notes thereto, available at www.sec.gov. As a Business Development Company Prior to becoming a BusinessDevelopment Company 2017 2016 2015 November12, 2014 toDecember 31,2014 January 1, 2014to November 11,2014 2013Statement of Operations Data: Investment income $38,914 $30,965 $26,070 $1,976 $— $—Operating revenues $— $— $— $— $131,847 $143,593Expenses $46,795 $40,225 $32,255 $4,305 $121,036 $131,319Net investment loss $(7,881) $(9,260) $(6,185) $(2,523) $— $—Net increase in net assets resulting fromoperations $38,976 $27,305 $35,736 $681 $— $—Net income $— $— $— $— $3,208 $7,151Net realized and unrealized gains (losses) $46,857 $36,565 $41,921 $3,204 $(3,668) $(1,205)Per Share Data: Net investment loss $(0.45) $(0.64) $(0.57) $(0.33) $— $—Net increase in net assets resulting fromoperations $2.25 $1.88 $3.32 $0.09 $— $—Basic earnings per share $— $— $— $— $0.45 $1.07Diluted earnings per share $— $— $— $— $0.45 $0.99Dividends declared $1.64 $1.53 $4.45 $— $— $—Balance Sheet Data (at end of period): Investments, at fair value $456,689 $345,224 $266,874 $233,462 N/A $83,685Total assets $519,611 $401,450 $352,430 $301,832 N/A $198,612Total debt $216,252 $171,242 $131,761 $122,543 N/A $101,358Total liabilities $241,282 $192,356 $148,481 $135,414 N/A $121,603Net assets/shareholders’ equity $278,329 $209,094 $203,949 $166,418 N/A $77,009Common shares outstanding at end of period 18,457 14,624 14,509 10,206 N/A 7,077ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.Introduction and Certain Cautionary StatementsThe following discussion and analysis of our financial condition and results of operations is intended to assist in the understanding and assessment ofsignificant changes and trends related to the results of operations and financial position of the Company together with its subsidiaries. This discussion andanalysis should be read in conjunction with the consolidated financial statements and the accompanying notes.The statements in this Annual Report may contain forward-looking statements relating to such matters as anticipated future financial performance, businessprospects, legislative developments and similar matters. We note that a variety of factors could cause our actual results to differ materially from theanticipated results expressed in the forward looking statements such as intensified competition and/or operating problems in our operating businessprojects and their impact on revenues and profit margins or additional factors as described under “Risk Factors” above.71Table of ContentsExecutive OverviewWe are a leading national non-bank lender and own and control certain portfolio companies under the Newtek® brand (our “controlled portfolio companies,”as defined below) that provide a wide range of business and financial products to SMBs. Newtek's products and services include: Business Lending,including origination of SBA 7(a) and SBA 504 loans, Electronic Payment Processing, Managed Technology Solutions (Cloud Computing), TechnologyConsulting, eCommerce, Accounts Receivable and Inventory Financing, The Newtek Advantage, personal and commercial Insurance Services, Web Services,Data Backup, Storage and Retrieval, and Payroll and Benefits Solutions to SMB accounts nationwide across all industries. We have an established andreliable platform that is not limited by client size, industry type, or location. As a result, we believe we have a strong and diversified client base across everystate in the U.S. and across a variety of different industries. In addition, we have developed a financial and technology based business model that enables usand our controlled portfolio companies to acquire and process our SMB clients in a very cost effective manner. This capability is supported in large part byNewTracker®, our patented prospect management technology software, which is similar to, but we believe better than, the system popularized bySalesforce.com. We believe that this technology and business model distinguishes us from our competitors.We consolidate the following wholly-owned subsidiaries:•Newtek Small Business Finance, LLC•Newtek Asset Backed Securities, LLC•The Whitestone Group, LLC•Wilshire Colorado Partners, LLC•Wilshire DC Partners, LLC•Wilshire Holdings I, Inc.•Wilshire Louisiana BIDCO, LLC•Wilshire Louisiana Partners II, LLC•Wilshire Louisiana Partners III, LLC•Wilshire Louisiana Partners IV, LLC•Wilshire New York Advisers II, LLC•Wilshire New York Partners III, LLC•Wilshire New York Partners IV, LLC•Wilshire New York Partners V, LLC•Wilshire Partners, LLC•CCC Real Estate Holdings, LLC•Exponential Business Development Co., Inc.•Newtek LSP Holdco, LLC•Newtek Business Services Holdco 1, Inc.•Newtek Business Services Holdco 2, Inc.•Newtek Business Services Holdco 3, Inc.•Newtek Business Services Holdco 4, Inc.•Newtek Business Services Holdco 5, Inc. (formerly Banc-Serv Acquisition, Inc.)72Table of ContentsWe are an internally-managed, closed-end, non-diversified investment company that has elected to be regulated as a BDC under the 1940 Act. In addition, forU.S. federal income tax purposes, we have elected to be treated as a RIC under the Code beginning in the 2015 tax year. As a BDC and a RIC, we are alsosubject to certain constraints, including limitations imposed by the 1940 Act and the Code. We converted to a BDC in November 2014. As a result,previously consolidated subsidiaries are now recorded as investments in controlled portfolio companies, at fair value. NSBF is a consolidated subsidiary andoriginates loans under the SBA's 7(a) program. Our common shares are currently listed on the Nasdaq Global Market under the symbol “NEWT”.NSBF has been granted PLP status and originates, sells and services SBA 7(a) loans and is authorized to place SBA guarantees on loans without seeking priorSBA review and approval. Being a national lender, PLP status allows NSBF to expedite the origination of loans since NSBF is not required to presentapplications to the SBA for concurrent review and approval. The loss of PLP status could adversely impact our marketing efforts and ultimately our loanorigination volume which could negatively impact our results of operations.As a BDC, our investment objective is to generate both current income and capital appreciation primarily through loans originated by our business financeplatform and our equity investments in certain portfolio companies that we control.We target our debt investments, which are principally made through our business finance platform under the SBA 7(a) program, to produce a coupon rate ofprime plus 2.75% which enables us to generate rapid sales of loans in the secondary market. We typically structure our debt investments with the maximumseniority and collateral along with personal guarantees from portfolio company owners, in many cases collateralized by other assets including real estate. Inmost cases, our debt investment will be collateralized by a first lien on the assets of the portfolio company and a first or second lien on assets of guarantors, inboth cases primarily real estate. All SBA loans are made with personal guarantees from any owner(s) of 20% or more of the portfolio company’s equity. Theamount of new debt investments, particularly SBA 7(a) loans that we originate, will directly impact future investment income. In addition, future amounts ofunrealized appreciation or depreciation on our investments, as well as the amount of realized gains or losses, will also fluctuate depending upon economicconditions and the performance of our investment portfolio. The changes in realized gains and losses and unrealized appreciation or depreciation could havea material impact on our operating results.We typically structure our debt investments to include non-financial covenants that seek to minimize our risk of capital loss such as lien protection andprohibitions against change of control. Our debt investments have strong protections, including default penalties, information rights and, in some cases,board observation rights and affirmative, negative and financial covenants. Debt investments in portfolio companies, including the controlled portfoliocompanies, have historically and are expected to continue to comprise the majority of our overall investments in number and dollar volume.While the vast majority of our investments have been structured as debt, we have in the past and expect in the future to make selective equity investmentsprimarily as either strategic investments to enhance the integrated operating platform or, to a lesser degree, under the Capco programs. For investments in ourcontrolled portfolio companies, we focus more on tailoring them to the long term growth needs of the companies than to immediate return. Our objectiveswith these companies is to foster the development of the businesses as a part of the integrated operational platform of serving the SMB market, so we mayreduce the burden on these companies to enable them to grow faster than they would otherwise and as another means of supporting their development.We regularly engage in discussions with third parties with respect to various potential transactions. We may acquire an investment or a portfolio ofinvestments or an entire company or sell a portion of our portfolio on an opportunistic basis. We, our subsidiaries, or our affiliates may also agree to managecertain other funds that invest in debt, equity or provide other financing or services to companies in a variety of industries for which we may earnmanagement or other fees for our services. We may also invest in the equity of these funds, along with other third parties, from which we would seek to earn areturn and/or future incentive allocations. Some of these transactions could be material to our business. Consummation of any such transaction will besubject to completion of due diligence, finalization of key business and financial terms (including price) and negotiation of final definitive documentation aswell as a number of other factors and conditions including, without limitation, the approval of our board of directors and required regulatory or third partyconsents and, in certain cases, the approval of our shareholders. Accordingly, there can be no assurance that any such transaction would be consummated.Any of these transactions or funds may require significant management resources either during the transaction phase or on an ongoing basis depending on theterms of the transaction.73Table of ContentsRevenuesWe generate revenue in the form of interest, dividend, servicing and other fee income on debt and equity investments. Our debt investments typically haveterms of 10 to 25 years and bear interest at prime plus a margin. In some instances, we receive payments on our debt investments based on scheduledamortization of the outstanding balances. In addition, we receive repayments of some of our debt investments prior to their scheduled maturity date. Thefrequency or volume of these repayments fluctuates significantly from period to period. Our portfolio activity also reflects the proceeds of sales of securities.We receive servicing income related to the guaranteed portions of SBA investments which we originate and sell into the secondary market. These recurringfees are earned daily and recorded when earned. In addition, we may generate revenue in the form of packaging, prepayment, legal and late fees. We recordsuch fees related to loans as other income. Dividends are recorded as dividend income on an accrual basis to the extent that such amounts are payable by theportfolio company and are expected to be collected. Dividend income is recorded at the time dividends are declared. Distributions of earnings from portfoliocompanies are evaluated to determine if the distribution is income, return of capital or realized gain.We recognize realized gains or losses on investments based on the difference between the net proceeds from the disposition and the cost basis of theinvestment without regard to unrealized gains or losses previously recognized. We record current period changes in fair value of investments and assets thatare measured at fair value as a component of the net change in unrealized appreciation (depreciation) on investments or servicing assets, as appropriate, in theconsolidated statements of operations.ExpensesOur primary operating expenses are salaries and benefits, interest expense and other general and administrative costs, such as professional fees, marketing,referral fees, servicing costs and rent. Since we are an internally-managed BDC with no outside adviser or management company, the BDC incurs all therelated costs to operate the Company.Loan Portfolio Asset Quality and CompositionThe following table sets forth distribution by business type of the Company’s SBA 7(a) unguaranteed loan portfolio at December 31, 2017 on a cost basis (inthousands):Distribution by Business Type Business Type # of Loans Balance Average Balance % of BalanceExisting Business 1,240 $235,416 $190 81.8%Business Acquisition 188 37,935 202 13.2%Start-Up Business 144 14,339 100 5.0%Total 1,572 $287,690 $183 100.0%The following table sets forth distribution by business type of the Company’s SBA 7(a) unguaranteed loan portfolio at December 31, 2016 on a cost basis (inthousands):Distribution by Business Type Business Type # of Loans Balance Average Balance % of BalanceExisting Business 921 $177,430 $193 80.7%Business Acquisition 169 30,454 180 13.9%Start-Up Business 138 11,900 86 5.4%Total 1,228 $219,784 $179 100.0% The following table sets forth distribution by borrower’s credit score of the Company’s SBA 7(a) unguaranteed loan portfolio at December 31, 2017 on a costbasis (in thousands):74Table of ContentsDistribution by Borrower Credit Score Credit Score # of Loans Aggregate Balance Average Balance % of Balance500 to 550 20 $3,261 $163 1.1%551 to 600 50 12,614 252 4.4%601 to 650 225 45,608 203 15.8%651 to 700 464 89,345 193 31.0%701 to 750 472 84,783 180 29.5%751 to 800 291 46,567 160 16.2%801 to 850 41 3,633 89 1.3%Not available 9 1,879 209 0.7%Total 1,572 $287,690 $183 100.0%The following table sets forth distribution by borrower’s credit score of the Company’s SBA 7(a) unguaranteed loan portfolio at December 31, 2016 on a costbasis (in thousands):Distribution by Borrower Credit Score Credit Score # of Loans Aggregate Balance Average Balance % of Balance500 to 550 17 $2,036 $120 0.9%551 to 600 38 6,748 178 3.1%601 to 650 160 32,912 206 15.0%651 to 700 344 64,923 189 29.5%701 to 750 372 67,006 180 30.5%751 to 800 250 39,600 158 18.0%801 to 850 40 4,124 103 1.9%Not available 7 2,435 348 1.1%Total 1,228 $219,784 $179 100.0%The following table sets forth distribution by primary collateral type of the Company’s SBA 7(a) unguaranteed loan portfolio at December 31, 2017 on a costbasis (in thousands):Distribution by Primary Collateral Type Collateral Type # of Loans Aggregate Balance Average Balance % of BalanceCommercial Real Estate 747 $168,063 $225 58.4%Machinery and Equipment 253 46,366 183 16.1%Residential Real Estate 317 25,789 81 9.0%Other 75 28,398 379 9.9%Accounts Receivable and Inventory 121 15,499 128 5.4%Liquid Assets 12 625 52 0.2%Unsecured 34 1,080 32 0.4%Furniture and Fixtures 13 1,870 144 0.6%Total 1,572 $287,690 $183 100.0%75Table of ContentsThe following table sets forth distribution by primary collateral type of the Company’s SBA 7(a) unguaranteed loan portfolio at December 31, 2016 on a costbasis (in thousands):Distribution by Primary Collateral Type Collateral Type # of Loans Aggregate Balance Average Balance % of BalanceCommercial Real Estate 589 $133,263 $226 60.6%Machinery and Equipment 201 37,426 186 17.0%Residential Real Estate 264 21,211 80 9.7%Other 45 13,822 307 6.3%Accounts Receivable and Inventory 80 12,075 151 5.5%Liquid Assets 15 667 44 0.3%Unsecured 23 883 38 0.4%Furniture and Fixtures 11 437 40 0.2%Total 1,228 $219,784 $179 100.0%The following table sets forth distribution by days delinquent of the Company’s SBA 7(a) unguaranteed loan portfolio at December 31, 2017 on a cost basis(in thousands):Distribution by Days Delinquent Delinquency Status # of Loans Aggregate Balance Average Balance % of BalanceCurrent 1,419 $249,960 $176 86.9%1 to 30 days 43 12,009 279 4.2%31 to 60 days 11 2,049 186 0.7%61 to 90 days 1 475 475 0.2%91 days or greater 98 23,197 237 8.0%Total 1,572 $287,690 $183 100.0%The following table sets forth distribution by days delinquent of the Company’s SBA 7(a) unguaranteed loan portfolio at December 31, 2016 on a cost basis(in thousands):Distribution by Days Delinquent Delinquency Status # of Loans Aggregate Balance Average Balance % of BalanceCurrent 1,119 $199,170 $178 90.6%1 to 30 days 35 3,680 105 1.7%31 to 60 days 7 1,570 224 0.7%61 to 90 days — — — —%91 days or greater 67 15,364 229 7.0%Total 1,228 $219,784 $179 100.0%76Table of ContentsComparison of the year ended December 31, 2017 and 2016Investment Income(in thousands)December 31, 2017 December 31, 2016 ChangeInvestment income: Interest income$18,671 $11,518 $7,153Dividend income9,747 10,573 (826)Servicing income7,206 6,160 1,046Other income3,290 2,714 576Total investment income$38,914 $30,965 $7,949Interest IncomeThe increase in interest income was attributable to the average outstanding performing portfolio of SBA non-affiliate investments increasing to $227,761,000from $176,210,000 for the years ended December 31, 2017 and 2016, respectively, combined with an increase in the Prime Rate. During the year endedDecember 31, 2016 the Prime Rate was 3.50%. During the year ended December 31, 2017 the Prime Rate was increased three times to 3.75%, effectiveJanuary 2017, to 4.00%, effective April 2017 and to 4.25%, effective July 2017. The increase in the average outstanding performing portfolio resulted fromthe origination of new SBA non-affiliate investments during the year. In addition, during the year ended December 31, 2017, we recognized $1,493,000 ofinterest income related to accrued non-performing interest owed by two borrowers who paid their accrued interest balance in full.Dividend Income(in thousands)December 31, 2017 December 31, 2016 ChangeUniversal Processing Services of Wisconsin, LLC$7,100 $6,800 $300Premier Payments LLC1,575 1,735 (160)Newtek Technology Solutions, Inc.— 990 (990)International Professional Marketing, Inc.550 — 550SIDCO, LLC225 — 225Small Business Lending, LLC— 696 (696)banc-serv Partners, LLC— 300 (300)CDS Business Services, Inc.200 — 200The Secure CyberGateway, LLC47 52 (5)United Capital Source, LLC50 — 50Total dividend income$9,747 $10,573 $(826)Dividend income decreased $826,000 year over year. During the year ended December 31, 2017, we earned $200,000 of dividend income from NBCS,$550,000 and $225,000 of dividend income from IPM and SIDCO, respectively, both new wholly-owned controlled portfolio companies that we invested inon April 6, 2017. Dividend income earned from UPSW increased $300,000 year over year. These increases were offset by decreases in dividend incomeearned from NTS, SBL and BSP. Dividend income is dependent on portfolio company earnings. Current period dividend income may not be indicative offuture period dividend income.NSBF Servicing Portfolio and Related Servicing IncomeThe following table represents NSBF originated servicing portfolio and servicing income earned for the years ended December 31, 2017 and 2016:77Table of Contents(in thousands):December 31, 2017 December 31, 2016 ChangeTotal NSBF originated servicing portfolio (1)$1,221,624 $960,517 $261,107Total servicing income earned$7,206 $6,160 $1,046(1) Of this amount, the total average NSBF originated portfolio earning servicing income was $783,578,000 and $633,126,000 for the years endedDecember 31, 2017 and 2016, respectively.The increase in servicing income was attributable to the increase in total portfolio investments for which we earn servicing income. The portfolio earningservicing income increased $150,452,000 year over year. The increase was attributable to an increase in SBA 7(a) non-affiliate investments from 2016 to2017.Other IncomeOther income relates primarily to legal, packaging, prepayment, and late fees earned from SBA 7(a) loans. The increase was related to an increase in legal andpackaging fees earned as a result of the larger dollar volume of loans originated.Expenses:(in thousands)December 31, 2017 December 31, 2016 ChangeSalaries and benefits$19,292 $15,234 $4,058Interest11,397 8,440 2,957Depreciation and amortization402 296 106Professional fees3,009 3,274 (265)Origination and servicing5,871 6,046 (175)Change in fair value of contingent consideration liabilities(455) — (455)Other general and administrative costs7,279 6,935 344Total expenses$46,795 $40,225 $6,570Salaries and BenefitsSalaries and benefits increased $4,058,000 primarily due to an increase in headcount at NSBF. The additional headcount relates primarily to employeesperforming loan processing, loan closing or loan servicing functions as a result of the increase in loan originations. The increase in salaries and benefits wasalso related to a $386,000 increase in stock-based compensation expense year over year.Interest ExpenseThe following is a summary of interest expense by facility for the years ended December 31, 2017 and 2016:(in thousands)December 31, 2017 December 31, 2016 ChangeNotes payable - Securitization Trusts$5,537 $3,976 $1,561Bank notes payable1,188 1,260 (72)Notes due 2022707 708 (1)Notes due 20213,164 2,181 983Notes payable - related parties780 260 520Other21 55 (34)Total interest expense$11,397 $8,440 $2,957The increase in interest expense year over year is primarily related to interest from the Notes payable - Securitization trusts, 2021 Notes and Notes payable -related parties. The increase from Notes payable - Securitization trusts was the result of an additional securitization transaction completed in November 2016and December 2017. In April 2016, we issued $40,250,00078Table of Contentsof 2021 Notes bearing interest at 7.00%. During the year ended December 31, 2017, we incurred a full year of interest expense as compared to a partial year ofinterest expense in 2016. The increase from Notes payable - related parties was related to the increase in the average outstanding balance year over year.Change in Fair Value of Contingent ConsiderationA portion of our investment in IPM consisted of contingent consideration based on IPM attaining specific EBITDA levels for 2017 and 2018. During the yearended December 31, 2017, we reduced the contingent consideration liability by $455,000 based on the probability of IPM attaining specific EBITDA levelsfor 2017 and 2018.Other General and Administrative CostsOther general and administrative costs include managed IT services, marketing, rent and other costs. In April 2016, the Company moved its headquarters toLake Success, New York. As a result, the Company vacated its spaces in West Hempstead, New York and New York, New York. The Company recorded a lossof $604,000 related to the remaining liabilities under the West Hempstead lease, offset by future rental income, during the year ended December 31, 2016. Nosuch expense was incurred during the year ended December 31, 2017. The Company has sublet both spaces. This decrease was offset by $1,397,000 of baddebt expense related to amounts owed from related parties, primarily PMT and BSP, which we determined to be uncollectible and an increase in referral feesof $485,000 related to the increase in loan originations year over year.Net Realized Gains and Net Unrealized Appreciation and DepreciationNet realized gains or losses on investments are measured by the difference between the net proceeds from the repayment or sale and the cost basis of ourinvestments without regard to unrealized appreciation or depreciation previously recognized and includes investments charged off during the period, net ofrecoveries. The net change in unrealized appreciation or depreciation on investments reflects the change in portfolio investment fair values during thereporting period, including the reversal of previously recorded unrealized appreciation or depreciation when gains or losses are realized.Net Realized Gains on SBA Non-Affiliate InvestmentsNet realized gains from SBA non-affiliate investments for the years ended December 31, 2017 and 2016 were $39,617,000 and $31,512,000, respectively,which includes realized losses of $894,000 and $925,000 during the years ended December 31, 2017 and 2016, respectively. December 31, 2017 December 31, 2016(in thousands)# of DebtInvestments $ Amount # of DebtInvestments $ AmountSBA non-affiliate investments originated480 $385,882 402 $309,147SBA guaranteed non-affiliate investments sold458 $283,630 379 $226,435Realized gains recognized on sale of SBA guaranteed non-affiliate investments— $40,511 — $32,437Average sale price as a percent of principal balance (1) 111.99% 111.91%(1) Realized gains greater than 110.00% must be split 50/50 with the SBA in accordance with SBA regulations. The realized gains recognized above reflectsamounts net of split with the SBA.Net Realized Gains (Losses) on Controlled InvestmentsDuring the year ended December 31, 2017 we recorded $200,000 in net realized losses from controlled portfolio companies which consisted of a $100,000realized gain from a distribution in excess of cost basis from SBL and a $300,000 realized loss related to the reversal of unrealized depreciation on a debtinvestment in The Secure CyberGateway, LLC. For the year ended December 31, 2016, realized gains on controlled investments were $108,000 andrepresented distributions from SBL in excess of cost basis. 79Table of ContentsNet Unrealized Appreciation (Depreciation) on Investments(in thousands)December 31, 2017 December 31, 2016 ChangeNet unrealized appreciation on SBA guaranteed non-affiliate investments$1,398 $1,035 $363Net unrealized (depreciation) appreciation on SBA unguaranteed non-affiliateinvestments(1,342) 18 (1,360)Net unrealized appreciation on controlled investments12,957 11,337 1,620Change in deferred taxes(2,179) (5,128) 2,949Net unrealized depreciation on non-control/non-affiliate investments— (43) 43Net unrealized loss in credits in lieu of cash and notes payable in credits in lieu of cash— (5) 5Total net unrealized appreciation on investments$10,834 $7,214 $3,620Net unrealized appreciation (depreciation) on SBA guaranteed non-affiliate investments relates to guaranteed portions of SBA debt investments made whichthe Company sells into a secondary market. Unrealized appreciation of SBA guaranteed investments represents the fair value adjustment of guaranteedportions of loans which have not yet been sold. Unrealized depreciation represents the reversal of unrealized appreciation when the SBA 7(a) loans are sold.Net Unrealized Appreciation (Depreciation) on Controlled Investments(in thousands)December 31, 2017 December 31, 2016 ChangeUniversal Processing Services of Wisconsin, LLC$17,000 $10,552 $6,448Newtek Technology Solutions, Inc.(7,659) (975) (6,684)Premier Payments LLC2,000 4,562 (2,562)CDS Business Services, Inc.7,250 (175) 7,425PMTWorks Payroll, LLC(3,045) (185) (2,860)banc-serv Partners, LLC(2,000) 140 (2,140)Small Business Lending, LLC(800) (2,200) 1,400The Secure CyberGateway, LLC300 (296) 596Titanium Asset Management LLC(42) (86) 44Excel WebSolutions, LLC(47) — (47)Total net unrealized appreciation on controlled investments$12,957 $11,337 $1,620Unrealized appreciation related to our investment in UPSW and Premier was related to an increase in revenue and EBITDA projections combined with adecrease in the corporate income tax rate as recently enacted by Congress. Unrealized appreciation related to our investment in NBCS was related to growthin its SBA 504 lending program and growth in its accounts receivable and inventory financing programs.Unrealized depreciation related to our investment in NTS was related to weak financial performance. During the year ended December 31, 2017, we made anadditional $1,000,000 debt investment in NPS. Due to NPS’ continued negative cash flows, we recorded an unrealized loss of $3,045,000 on our totalinvestment in NPS, which consisted of an $860,000 equity investment and $2,185,000 of debt investments, including a $1,000,000 investment made in NPSin 2017. During the year ended December 31, 2017, the Company recorded a $2,000,000 unrealized loss on its investment in BSP to reflect the potentialimpact to the business and tradename as a result of the FBI investigation discussed in Note 9.Provision for Deferred Taxes on Net Unrealized Appreciation of InvestmentsCertain consolidated subsidiaries of ours are subject to U.S. federal and state income taxes. These taxable subsidiaries are not consolidated with the Companyfor income tax purposes, but are consolidated for GAAP purposes, and may generate income tax liabilities or assets from temporary differences in therecognition of items for financial reporting and income tax purposes at the subsidiaries. During the years ended December 31, 2017 and 2016, we recognizeda provision for deferred taxes of80Table of Contents$2,179,000 and $5,128,000, respectively, related to the net unrealized appreciation of controlled portfolio company investments.Net Unrealized Depreciation on Servicing Assets(in thousands)December 31, 2017 December 31, 2016 ChangeNet unrealized depreciation on servicing assets$(3,394) $(2,269) $(1,125)The increase in unrealized depreciation on servicing assets is primarily related to the increase in the discount rate from 12.20% to 13.06% and an increase inthe cumulative prepayment rate from 18.50% to 20.00%.Comparison of the year ended December 31, 2016 and 2015Investment Income(in thousands)December 31, 2016 December 31, 2015 ChangeInvestment income: Interest income$11,518 $9,201 $2,317Dividend income10,573 10,218 355Servicing income6,160 4,611 1,549Other income2,714 2,040 674Total investment income$30,965 $26,070 $4,895Interest IncomeThe increase in interest income was attributable to the average outstanding performing portfolio of SBA non-affiliate investments increasing to $176,210,000from $136,964,000 for the years ended December 31, 2016 and 2015, respectively, as well as the increase in the Prime Rate from 3.25% to 3.50% inDecember 2015. The increase in the average outstanding performing portfolio resulted from the origination of new SBA non-affiliate investments year overyear.Dividend IncomeDividend income is dependent on portfolio company earnings. Current year dividend income may not be indicative of future year dividend income.The increase in dividend income is primarily related to an increase of dividends generated from Premier of $1,135,000, an increase of $682,000 in dividendsgenerated from NTS, an increase of $348,000 in dividends generated from SBL, an increase of $210,000 in dividends generated from UPSW, and $300,000 ofdividends generated from BSP, a new wholly owned controlled portfolio company investment we made in June 2016. These increases were offset by one-timedividends of $1,080,000 and $1,162,000 received from Exponential Business Development Co., Inc. and Summit Systems and Designs, LLC, respectively in2015, both of which are no longer operating portfolio company businesses.NSBF Servicing Portfolio and Related Servicing IncomeThe following table represents NSBF originated servicing portfolio and servicing income earned for the years ended December 31, 2016 and 2015:(in thousands):December 31, 2016 December 31, 2015 ChangeTotal NSBF originated servicing portfolio (1)$960,517 $768,588 $191,929Total servicing income earned$6,160 $4,611 $1,549(1) Of this amount, the total average NSBF originated portfolio earning servicing income was $633,126,000 and $520,794,000 for the years endedDecember 31, 2016 and 2015, respectively.81Table of ContentsThe increase in servicing income was attributable to the increase in total portfolio investments for which we earn servicing income. The portfolio earningservicing income increased $112,332,000 year over year. The increase was a direct result of increased investments in SBA 7(a) non-affiliate investments from2015 to 2016.Other IncomeOther income relates primarily to legal, packaging, prepayment, and late fees earned from SBA loans. The increase is related to the increase in the number ofloans funded to 402 for the year ended December 31, 2016 from 292 during the year ended December 31, 2015. This increase resulted in an increase in legaland packaging fees earned on such loans.Expenses:(in thousands)December 31, 2016 December 31, 2015 ChangeSalaries and benefits$15,234 $12,753 $2,481Interest8,440 6,479 1,961Depreciation and amortization296 326 (30)Other general and administrative costs16,255 12,697 3,558Total expenses$40,225 $32,255 $7,970Salaries and BenefitsSalaries and benefits increased $2,481,000 primarily due to an increase in employees at NSBF performing underwriting, processing, closing and servicingfunctions as a result of the increase in annual loan originations. The increase was also attributable to $577,000 of stock based compensation expense incurredduring the year ended December 31, 2016 related to the issuance of restricted stock awards to employees. No stock based compensation expense was incurredduring the year ended December 31, 2015.Interest ExpenseThe following is a summary of interest expense by facility for the years ended December 31, 2016 and 2015:(in thousands)December 31, 2016 December 31, 2015 ChangeNotes payable - Securitization Trusts$3,976 $3,810 $166Bank notes payable1,267 1,166 101Capital One term loan and line of credit (NBS)— 564 (564)Notes due 2022708 192 516Notes due 20212,181 — 2,181Notes payable - related parties260 621 (361)Notes payable in credits in lieu of cash43 80 (37)Other5 46 (41)Total interest expense$8,440 $6,479 $1,961In September 2015 and April 2016, the Company issued $8,324,000 of 7.50% Notes due 2022, and $40,250,000 of 7.00% Notes due 2021, respectively. TheCompany incurred $2,889,000 in related interest expense during the year ended December 31, 2016 on the Notes. The increase is attributed to incurring a fullyear of interest expense on the Notes due 2022 and the issuance of the Notes due 2021 in 2016. Interest expense on notes payable - related parties was$260,000 and $621,000 during the years ended December 31, 2016 and 2015, respectively, and represents interest on amounts borrowed under an unsecuredrevolving line of credit extended by UPSW and NTS. The decrease is attributed to a decrease in the average outstanding balance on Notes payable - relatedparties during the year. In June 2014, the Company entered into a four year $20,000,000 credit agreement with Capital One consisting of a $10,000,000 termloan and a revolving line of credit of up to $10,000,000. The NBS Capital One term loan and line of credit were paid in full and extinguished in June 2015,and as such, no interest expense was incurred during the year ended December 31, 2015.82Table of ContentsOther General and Administrative CostsOther general and administrative costs include professional fees, marketing, loan related costs, rent and loss on lease expense. The increase in other generaland administrative costs is primarily related to an increase in loan related costs, rent expense and loss on lease expense. Loan related costs include referralfees, servicing expenses, appraisal fees, legal fees, search fees and other collateral preservation costs. Loan related costs increase as the number of loans weoriginate and service increase. At December 31, 2016, our loan portfolio consisted of 1,228 SBA 7(a) loans as compared to 948 at December 31, 2015. Loanrelated costs increased $1,775,000 year over year as a result of the increase in the loan portfolio. Additionally, rent expense increased as a result of the moveto our Lake Success offices.In April 2016, the Company moved its headquarters to Lake Success, New York. As a result, the Company vacated its spaces in West Hempstead, New Yorkand New York, New York. The Company recorded a loss of $604,000 related to the remaining liabilities under the West Hempstead lease, offset by futurerental income, during the year ended December 31, 2016. The Company has sublet both spaces.Net Realized Gains and Net Unrealized Appreciation and DepreciationNet realized gains or losses on investments are measured by the difference between the net proceeds from the repayment or sale and the cost basis of ourinvestments without regard to unrealized appreciation or depreciation previously recognized and includes investments charged off during the period, net ofrecoveries. Realized gains for the year ended December 31, 2016 and 2015 were $32,437,000 and $29,575,000, respectively. Realized losses were $925,000and $1,189,000 during the years ended December 31, 2016 and 2015, respectively. The net change in unrealized appreciation or depreciation on investmentsprimarily reflects the change in portfolio investment fair values during the reporting period, including the reversal of previously recorded unrealizedappreciation or depreciation when gains or losses are realized.Net Realized Gains on SBA Non-Affiliate Investments Year Ended December 31, 2016 December 31, 2015(in thousands)# of DebtInvestments $ Amount # of DebtInvestments $ AmountSBA non-affiliate investments funded402 $309,147 292 $242,496SBA guaranteed non-affiliate investments sold379 $226,435 304 $211,089Realized gains recognized on sale of SBA guaranteed non-affiliate investments— $32,437 — $29,575Average sale price as a percent of principal balance (1) 111.91% 111.72%(1) Realized gains greater than 110.00% must be split 50/50 with the SBA in accordance with SBA regulations. The realized gains recognized above reflectsamounts net of split with the SBA.Net Realized Gains on Controlled InvestmentsFor the year ended December 31, 2016, realized gains on controlled investments were $108,000 and primarily represented distributions from SBL in excess ofour cost basis. For the year ended December 31, 2015, realized gains on controlled investments were $5,473,000 and represent distributions in excess of ourcost basis from controlled affiliates. Included in the $5,473,000 is a distribution in excess of basis from UPSW and First Bankcard Alliance of Alabama, LLCof $4,892,000 and $572,000, respectively. 83Table of ContentsNet Unrealized Appreciation (Depreciation) on Investments(in thousands)December 31, 2016 December 31, 2015 ChangeNet unrealized appreciation (depreciation) on SBA guaranteed non-affiliate investments$1,035 $(3,215) $4,250Net unrealized appreciation on SBA unguaranteed non-affiliate investments18 1,183 (1,165)Net unrealized appreciation on controlled investments11,337 12,250 (913)Change in provision for deferred taxes on net unrealized gains on investments(5,128) (857) (4,271)Net unrealized depreciation on credits in lieu of cash and notes payable in credits in lieuof cash(5) (7) 2Net unrealized depreciation on non-control/non-affiliate investments(43) (24) (19)Total net unrealized appreciation on investments$7,214 $9,330 $(2,116)Net unrealized appreciation (depreciation) on SBA guaranteed non-affiliate investments relates to guaranteed portions of SBA debt investments made whichthe Company sells into a secondary market. Unrealized appreciation of SBA guaranteed investments represents the fair value adjustment of guaranteedportions of loans which have not yet been sold. Unrealized depreciation represents the reversal of unrealized appreciation when the SBA 7(a) loans are sold.The decrease in net unrealized appreciation on SBA unguaranteed non-affiliate investments resulted from an increase in discount rates on performing SBAunguaranteed non-affiliate investments. The discount rate increased from 5.30% to 5.50% year over year on performing SBA unguaranteed non-affiliateinvestments.Net unrealized appreciation on controlled investments for the year ended December 31, 2016 consisted of unrealized appreciation of $10,552,000 and$4,562,000 on our investments in UPSW and Premier, respectively offset by unrealized depreciation of $2,200,000, $975,000, and $175,000 on ourinvestments in SBL, NTS, and NBC, respectively. The primary driver of the increases were increases in multiples of comparable companies and increases inrevenue growth projections. The decrease in SBL, NTS, and NBC was based on weaker than projected financial performance. Net unrealized appreciation oncontrolled investments was $12,250,000 for the year ended December 31, 2015. This consisted primarily of $6,948,000 of unrealized appreciation on ourinvestment in UPSW and $5,565,000 of unrealized appreciation on our investment in SBL which were offset by unrealized depreciation of approximately$966,000 on our investment in NBC. The primary driver of the increase in UPSW was better than projected financial performance and an increase in multiplesof comparable companies. The primary driver for the increase in SBL was the addition of a new third party servicing contract which provides a longer-termstable revenue stream.Provision for Deferred Taxes on Net Unrealized Appreciation of InvestmentsCertain consolidated subsidiaries of ours are subject to U.S. federal and state income taxes. These taxable subsidiaries are not consolidated with the Companyfor income tax purposes, but are consolidated for GAAP purposes, and may generate income tax liabilities or assets from temporary differences in therecognition of items for financial reporting and income tax purposes at the subsidiaries. During the years ended December 31, 2016 and 2015 we recognizeda provision for deferred taxes on net unrealized gains of $5,128,000 and $857,000, respectively. The increase is mainly attributed to unrealized gains relatedto our investments in UPSW and Premier.Net Unrealized Depreciation on Servicing Assets(in thousands)December 31, 2016 December 31, 2015 ChangeNet unrealized depreciation on servicing assets$(2,269) $(1,268) $(1,001)The increase in unrealized depreciation on servicing assets is primarily related to the increase in the discount rate from 12.03% to 12.20% and an increase inthe cumulative prepayment rate from 15.5% to 18.5%.Liquidity and Capital Resources84Table of ContentsOverviewOur liquidity and capital resources are derived from our Capital One Facility, Notes payable - related parties, 2021 Notes, 2022 Notes, securitizationtransactions and cash flows from operations, including investment sales and repayments, and income earned. Our primary use of funds from operationsincludes investments in portfolio companies and payments of fees and other operating expenses we incur. We have used, and expect to continue to use, ourborrowings and the proceeds from the turnover of our portfolio and from public and private offerings of securities to finance our investment objectives. Wemay raise additional equity or debt capital through both registered offerings off a shelf registration, including “At-The-Market”, or ATM, and privateofferings of securities.Public OfferingsATM ProgramThe ATM Equity Distribution Agreement provides that we may offer and sell up to 2,900,000 shares of common stock from time to time through thePlacement Agents. During the year ended December 31, 2017, we sold 1,139,000 shares of our common stock at a weighted average price of $17.58 per share.Proceeds, net of offering costs and expenses were $19,620,000. The Company may offer up to an additional 1,761,000 shares of common stock under theATM Equity Distribution Agreement as of December 31, 2017.We used the net proceeds for funding investments in debt and equity securities in accordance with our investment objective and strategies and for generalcorporate purposes including funding investments, repaying outstanding indebtedness and other general corporate purposes.Equity OfferingsIn January 2017 we completed a public offering of 2,250,000 shares of our common stock at a public offering price of $15.25 per share and an additional337,500 shares of common stock at a public offering price of $15.25 per share pursuant to the underwriter's full exercise of the over-allotment option.Proceeds, net of offering costs and expenses were $37,042,000.Debt OfferingsIn April 2016, the Company and the Trustee, entered into the Second Supplemental Indenture to the Base Indenture between the Company and the Trustee,relating to the Company’s issuance, offer and sale of $35,000,000 aggregate principal amount of 7.0% Notes due 2021. The Company granted anoverallotment option of up to $5,250,000 in aggregate principal amount of the 2021 Notes. The sale of the Notes generated proceeds of approximately$33,750,000, net of underwriter's fees and expenses. In May 2016, the underwriters exercised their option to purchase $5,250,000 in aggregate principalamount of notes for an additional $5,066,000 in net proceeds. The 2021 Notes are the Company’s direct unsecured obligations and rank: (i) pari passu withthe Company’s other outstanding and future unsecured indebtedness; (ii) senior to any of the Company’s future indebtedness that expressly provides it issubordinated to the 2021 Notes; (iii) effectively subordinated to all the Company’s existing and future secured indebtedness (including indebtedness that isinitially unsecured to which the Company subsequently grants security), to the extent of the value of the assets securing such indebtedness; and (iv)structurally subordinated to all existing and future indebtedness and other obligations of any of the Company’s subsidiaries.The 2021 Notes will mature on March 31, 2021 and may be redeemed in whole or in part at the Company’s option at any time or from time to time on or afterApril 22, 2017, at a redemption price of 100% of the outstanding principal amount thereof plus accrued and unpaid interest payments otherwise payable forthe then-current quarterly interest period accrued to but not including the date fixed for redemption. The 2021 Notes bear interest at a rate of 7.0% per yearpayable quarterly on March 31, June 30, September 30, and December 31 of each year, commencing on June 30, 2016, and trade on the Nasdaq GlobalMarket under the trading symbol “NEWTL.”The Base Indenture, as supplemented by the Second Supplemental Indenture, contains certain covenants including covenants requiring the Company tocomply with (regardless of whether it is subject to) the asset coverage requirements set forth in Section 18(a)(1)(A) of the 1940 Act as modified bySection 61(a)(1) of the 1940 Act, to comply with (regardless of whether it is subject to) the restrictions on dividends, distributions and purchase of capitalstock set forth in Section 18(a)(1)(B) of the 1940 Act as modified by Section 61(a)(1) of the 1940 Act as in effect immediately prior to the issuance of the2021 Notes, and to provide financial information to the holders of the 2021 Notes and the Trustee if the Company should no longer be subject to thereporting requirements under the Exchange Act. These covenants are subject to important limitations and exceptions that85Table of Contentsare described in the Base Indenture, as supplemented by the First Supplemental Indenture. The Base Indenture provides for customary events of default andfurther provides that the Trustee or the holders of 25% in aggregate principal amount of the outstanding 2021 Notes may declare such 2021 Notesimmediately due and payable upon the occurrence of any event of default after expiration of any applicable grace period. At December 31, 2017, theCompany was in compliance with all covenants related to the 2021 Notes. See “Subsequent Events” for more information regarding the redemption of the2021 Notes.In September 2015, the Company and the Trustee entered into the Base Indenture and the First Supplemental Indenture relating to the Company's issuance,offer, and sale of $8,324,000, including the underwriter's partial exercise of their over-allotment option, in aggregate principal amount of the 7.5% Notes due2022. The 2022 Notes are the Company’s direct unsecured obligations and rank: (i) pari passu with the Company’s other outstanding and future unsecuredindebtedness; (ii) senior to any of the Company’s future indebtedness that expressly provides it is subordinated to the 2022 Notes; (iii) effectivelysubordinated to all the Company’s existing and future secured indebtedness (including indebtedness that is initially unsecured to which the Companysubsequently grants security), to the extent of the value of the assets securing such indebtedness; and (iv) structurally subordinated to all existing and futureindebtedness and other obligations of any of the Company’s subsidiaries. The 2022 Notes will mature on September 30, 2022 and may be redeemed in wholeor in part at the Company’s option at any time or from time to time on or after September 23, 2018, at a redemption price of 100% of the outstandingprincipal amount thereof plus accrued and unpaid interest payments otherwise payable for the then-current quarterly interest period accrued to but notincluding the date fixed for redemption. Proceeds net of offering costs and expenses were $7,747,000.The Base Indenture, as supplemented by the First Supplemental Indenture, contains certain covenants including covenants requiring the Company to complywith (regardless of whether it is subject to) the asset coverage requirements set forth in Section 18(a)(1)(A) of the 1940 Act as modified by Section 61(a)(1) ofthe 1940 Act, to comply with the restrictions on dividends, distributions and purchase of capital stock set forth in Section 18(a)(1)(B) of the 1940 Act asmodified by Section 61(a)(1) of the 1940 Act, and to provide financial information to the holders of the 2022 Notes and the Trustee if the Company shouldno longer be subject to the reporting requirements under the Exchange Act. These covenants are subject to important limitations and exceptions that aredescribed in the Base Indenture, as supplemented by the Second Supplemental Indenture. The Base Indenture provides for customary events of default andfurther provides that the Trustee or the holders of 25% in aggregate principal amount of the outstanding 2022 Notes may declare such 2022 Notesimmediately due and payable upon the occurrence of any event of default after expiration of any applicable grace period. At December 31, 2017, theCompany is in compliance with all covenants related to the 2022 Notes.On February 21, 2018, the Company closed a public offering of $50,000,000 in aggregate principal amount of its 2023 Notes. The 2023 Notes will mature onMarch 1, 2023 and may be redeemed in whole or in part at any time or from time to time at Newtek’s option on or after March 1, 2020. The 2023 Notes bearinterest at a rate of 6.25% per year payable quarterly on March 1, June 1, September 1 and December 1, of each year, beginning June 1, 2018. Total netproceeds received after deducting underwriters’ discount and expenses was $48,288,000. The 2023 Notes are listed on the Nasdaq Global Market under thetrading symbol “NEWTI” and were rated “A-“ by Egan-Jones. A portion of the proceeds will be used to redeem the outstanding 2021 Notes pending theconclusion of a 30-day notice period to existing holders of the 2021 Notes, expiring on March 23, 2018. In February 2018, the underwriters exercised theiroption to purchase an additional $7,500,000 in aggregate principal amount of the 2023 Notes resulting in an additional $7,275,000 in net proceeds.On February 21, 2018, the Company issued redemption notices to the holders of the 2021 Notes. The Company will redeem all $40,250,000 in aggregateprincipal amount of the Notes on the Redemption Date at 100% of their principal amount ($25 per Note), plus the accrued and unpaid interest thereon fromDecember 31, 2017, through, but excluding, the Redemption Date.Capital One FacilitiesIn May 2017, NSBF amended its Capital One facility to increase the facility from $50,000,000 to $100,000,000 and provided a reduction in interest rates.The interest rate on the portion of the facility, collateralized by the government guaranteed portion of SBA 7(a) loans, is set at Prime minus 0.25%(previously Prime plus 1.00%), and there is a quarterly facility fee equal to 0.25% on the unused portion of the revolving credit calculated as of the end ofeach calendar quarter. The interest rate on the portion of the facility, collateralized by the non-guaranteed portion of SBA 7(a) loans, is set at Prime plus0.75% (previously Prime plus 1.875%), and there is a quarterly facility fee equal to 0.25% on the unused portion of the revolving credit calculated as of theend of each calendar quarter. The facility provides for a 55% advance rate on the non-guaranteed portions of the SBA 7(a) loans NSBF originates, and a 90%advance rate on the guaranteed portions of SBA 7(a) loans NSBF originates. In addition, the amendment extended the date on which the facility will convertto a term loan from May 16, 2017 to May 11, 2020 and extended the maturity date of the facility to May 11, 2022. 86Table of ContentsIn June 2015, NSBF amended the existing facility to eliminate the fixed charge coverage ratio in exchange for a debt service ratio, new EBITDA minimums,the elimination of restrictions on the our ability to pay dividends to shareholders, as well as the release of the guarantees of our former subsidiaries (nowtreated as portfolio companies).At December 31, 2017, we had no amounts outstanding under the unguaranteed and guaranteed lines of credit and were in full compliance with all applicableloan covenants.Notes Payable - Related PartiesIn June 2015, the Company entered into the Related Party RLOC. Maximum borrowings under the Related Party RLOC were $38,000,000. In June 2017, theRelated Party RLOC was amended to increase maximum borrowings to $50,000,000. The outstanding balance bears interest at a rate equal to (a) LIBOR (witha floor of 0.50%) plus (b) 6% or at a rate equal to (y) the greater of the Prime Rate or 3.5% plus (z) 5.0%. At December 31, 2017, the Related Party RLOCinterest rate was 7.69%. The Related Party RLOC has a maturity date of June 21, 2021. Outstanding borrowings at December 31, 2017 were $7,001,000.Securitization TransactionsSince 2010, NSBF has engaged in securitizations of the unguaranteed portions of its SBA 7(a) loans. In the securitization, it uses a special purpose entity (the“Trust”) which is considered a variable interest entity. Applying the consolidation requirements for VIEs under the accounting rules in ASC Topic 860,Transfers and Servicing, and ASC Topic 810, Consolidation, which became effective January 1, 2010, the Company determined that as the primarybeneficiary of the securitization vehicle, based on its power to direct activities through its role as servicer for the Trust and its obligation to absorb losses andright to receive benefits, it needed to consolidate the Trusts. NSBF therefore consolidated the entity using the carrying amounts of the Trust’s assets andliabilities. NSBF reflects the assets in SBA Unguaranteed Non-Affiliate Investments and reflects the associated financing in Notes Payable - SecuritizationTrusts.In November 2016, NSBF completed its seventh securitization which resulted in the transfer of $56,073,000 of unguaranteed portions of SBA loans to the2016-1 Trust. The 2016-1 Trust in turn issued securitization notes for the par amount of $53,444,000, consisting of $43,632,000 Class A notes and$9,812,000 of Class B notes, against the assets in a private placement. The Class A and Class B notes received an “A” and “BBB+” rating by S&P,respectively, and the final maturity date of the notes is February 2042.In December 2017, NSBF completed its eighth securitization which resulted in the transfer of $76,188,000 of unguaranteed portions of SBA loans to the2017-1 Trust. The 2017-1 Trust in turn issued securitization notes for the par amount of $75,426,000, consisting of $58,111,000 Class A notes and$17,315,000 of Class B notes, against the assets in a private placement. The Class A and Class B notes received an “A” and “BBB-” rating by S&P,respectively, and the final maturity date of the notes is February 2043.Share Repurchase PlanOn November 21, 2016 the Company announced that its Board approved a new share repurchase program under which the Company may repurchase up to200,000 of the Company’s outstanding common shares on the open market. This program terminated on May 21, 2017.On May 11, 2016, the Company announced that its Board approved a share repurchase program under which the Company could repurchase up to 150,000 ofthe Company’s outstanding common shares on the open market. This program terminated on November 11, 2016.During the year ended December 31, 2016, the Company repurchased and retired 70,000 common shares in open market transactions for $866,000 as detailedin the table below.87Table of ContentsPurchase date Number of SharesPurchased Price per Share TotalMarch 10, 2016 10 $12.34 $123March 18, 2016 20 $12.45 249March 18, 2016 30 $12.48 375March 23, 2016 10 $11.88 119Total 70 $866Note Repurchase PlanThe Company had a program which allowed it to repurchase up to 10%, or $832,400 in aggregate principal amount, of its 7.5% Notes due 2022 and up to10%, or $4,025,000 in aggregate principal amount, of its 7.0% Notes due 2021 through open market purchases, including block purchases, in such manner aswill comply with the provisions of the 1940 Act and the Exchange Act. The program terminated on May 21, 2017. The Company did not make anyrepurchases under this program during the year ended December 31, 2017.Cash Flows and LiquidityAs of December 31, 2017, the Company’s unused sources of liquidity consisted of $34,666,000 available through the Capital One facility; $22,178,000available through notes payable with related parties; $2,464,000 in unrestricted cash and $9,000 in money market funds.Restricted cash of $18,074,000 as of December 31, 2017 is primarily held by NSBF. The majority, or $17,323,000 of restricted cash includes reserves in theevent payments are insufficient to cover interest and/or principal with respect to securitizations and loan principal and interest collected which are due toloan participants.The Company generated and used cash as follows: December 31, 2017 December 31, 2016 December 31, 2015Net cash used in operating activities$(68,486) $(10,912) $(37,951)Net cash (used in) provided by investing activities(446) (375) 302Net cash provided by financing activities69,345 9,030 24,144Net increase (decrease) in cash and cash equivalents413 (2,257) (13,505)Cash and cash equivalents, beginning of year2,051 4,308 17,813Cash and cash equivalents, end of year$2,464 $2,051 $4,308December 31, 2017During the year ended December 31, 2017, operating activities used cash of $68,486,000, consisting primarily of (i) an increase in broker receivables whicharise from the guaranteed portions of SBA 7(a) loans that were traded but had not settled before period end and represent the amount of cash due from thepurchasing broker; the amount varies depending on loan origination volume and timing of sales at period end, (ii) $385,882,000 of SBA 7(a) loaninvestments funded (iii) $18,343,000 of advances to NBCS under a revolving line of credit (iv) $10,997,000 of cash paid in connection with our investmentsin IPM and SIDCO, (v) $1,950,000 of cash paid in connection with our investment in UCS (vi) $6,469,000 purchase of SBA 7(a) loans from the SBA and (vii)a $3,255,000 non-control/non-affiliate investment.These decreases to operating cash were offset by (i) $324,141,000 of proceeds from the sale of SBA 7(a) investments, (ii) $47,136,000 of principal paymentsreceived consisting of $27,035,000 from SBA non-affiliate investments, $3,255,000 from non-control/non-affiliate investments and $16,846,000 fromcontrolled investments, including $14,637,000 from NBCS and (iii) a decrease in restricted cash of $4,450,000.Net cash provided by financing activities was $69,345,000 consisting primarily of (i) net proceeds $37,042,000 from the sale of 2,857,500 shares of commonstock, (ii) net proceeds of $19,620,000 from the sale of 1,139,000 shares of common stock under the ATM Equity Distribution Agreement, (iii) $5,601,000 ofnet borrowings under the related party revolving line of credit and (iv) the issuance of additional securitization notes payable of $75,426,000. Theseincreases were offset by (i) $28,934,000 of88Table of Contentsdividend payments, (ii) $31,036,000 of principal payments on securitization notes payable and (iii) net repayments of $5,100,000 on bank notes payable.December 31, 2016For the year ended December 31, 2016, cash and cash equivalents decreased by $2,257,000 which was primarily the net result of $10,912,000 of cash used foroperating activities and $9,030,000 of cash provided by financing activities.During the year we used $10,912,000 of cash for our operating activities consisting primarily of (i) $309,147,000 of SBA 7(a) loan investments funded, (ii) a$5,400,000 investment in 100% of the membership interests of BSP, (iii) a $2,057,000 repurchase of a loan from the SBA, (iv) a non-controlled/non-affiliatedebt investment of $1,020,000 in Excel WebSolutions, LLC and (v) $775,000 of additional investments in PMT. These uses were offset by (i) $258,873,000of proceeds from the sale of SBA 7(a) investments (ii) a decrease in broker receivables which arise from the guaranteed portions of SBA 7(a) loans that weretraded but had not yet settled before period end and represent the amount of cash due from the purchasing broker; the amount varies depending on loanorigination volume and timing of sales at period end, (iii) $26,909,000 of principal payments received from affiliate and non-affiliate investments and (iv) adecrease in restricted cash of $3,187,000.Net cash provided by financing activities was $9,030,000 consisting primarily of (i) proceeds of $38,510,000, net of deferred financing costs from our offerand sale of 7.00% Notes due 2021, (ii) issuance of additional securitization notes payable of $53,444,000 offset by (i) dividend payments of $27,300,000, (ii)principal payments of $24,379,000 on securitization notes payable, (iii) $24,000,000 of net repayments on bank notes payable (iv) $4,247,000 of netprincipal payments on notes payable - related parties and (v) $866,000 of common share repurchases.Contractual ObligationsThe following table represents our obligations and commitments as of December 31, 2017 for future cash payments under debt, lease and employmentagreements: Payments due by periodContractual ObligationsTotal Less than 1 year 1-3 years 3-5 years More than 5 yearsBank notes payable$— $— $— $— $—Securitization notes payable165,432 — — — 165,432Notes due 20228,324 — — 8,324 —Notes due 2021 (1)40,250 — — 40,250 —Note payable - related party7,001 — — 7,001 —Operating leases (2)14,080 2,005 3,146 2,712 6,217Employment agreements300 300 — — —Total contractual obligations$235,387 $2,305 $3,146 $58,287 $171,649(1) See Note 19 for additional discussion regarding the 2021 Notes.(2) Minimum payments have not been reduced by minimum sublease rentals of $450,000 due in the future under non-cancellable subleases.Critical Accounting Policies and EstimatesThe preparation of financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affectthe reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expensesduring the periods reported. Actual results could materially differ from those estimates. We have identified the following items as critical accounting policies.Fair Value MeasurementsWe value investments for which market quotations are readily available at their market quotations. However, a readily available market value is not expectedto 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 underour valuation policy and process. We may seek pricing information with respect to certain of our investments from pricing services or brokers or dealers inorder to value such investments. We89Table of Contentsalso employ independent third party valuation firms for certain of our investments for which there is not a readily available market value. The application of our valuation methods may include comparisons of the portfolio companies to peer companies that are public, the enterprise value of aportfolio company, the nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings, discounted cashflow, the markets in which the portfolio company does business and other relevant factors. When an external event such as a purchase transaction, publicoffering or subsequent equity sale occurs, we will consider the pricing indicated by the external event to corroborate the private equity valuation. Due to theinherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the investments maydiffer significantly from the values that would have been used had a readily available market value existed for such investments and may differ materiallyfrom values that may ultimately be received or settled.Our Board is ultimately and solely responsible for determining, in good faith, the fair value of investments that are not publicly traded, whose market pricesare not readily available on a quarterly basis or any other situation where portfolio investments require a fair value determination.Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants atthe measurement date (an exit price). ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair valueinto three levels for disclosure purposes. The Company carries all investments at fair value. Additionally, the Company carries its credits in lieu of cash, notespayable in credits in lieu of cash, and servicing assets at fair value. The fair value hierarchy gives the highest priority (Level 1) to quoted prices in activemarkets for identical assets or liabilities and gives the lowest priority to unobservable inputs (Level 3). An asset or liability’s classification within the fairvalue hierarchy is based on the lowest level of the significant input to its valuation. The levels of the fair value hierarchy are as follows: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities and derivativecontracts that are traded in an active exchange market, as well as certain U.S. Treasury, other U.S. Government and agency mortgage-backeddebt securities that are highly liquid and are actively traded in over-the-counter markets. Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, orother inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments andderivative contracts whose value is determined using a pricing model with inputs that are observable in the market or can be derivedprincipally from or corroborated by observable market data. This category generally includes certain U.S. Government and agency mortgage-backed debt securities, corporate debt securities, derivative contracts and residential mortgage loans held-for-sale. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, orsimilar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.This category generally includes certain private equity investments, retained residual interests in securitizations, residential mortgage servicingrights, and highly structured or long-term derivative contracts.Valuation of InvestmentsLevel 1 investments are valued using quoted market prices. Level 2 investments are valued using market consensus prices that are corroborated byobservable market data and quoted market prices for similar assets and liabilities. Level 3 investments are valued at fair value as determined in good faith bythe Board, based on input of management, the audit committee and independent valuation firms that have been engaged at the direction of the Board to assistin the valuation of certain portfolio investments without a readily available market quotation at least once during a trailing twelve-month period under avaluation policy and a consistently applied valuation process.When determining fair value of Level 3 debt and equity investments, the Company may take into account the following factors, where relevant: theenterprise value of a portfolio company, the nature and realizable value of any collateral, the portfolio90Table of Contentscompany’s ability to make payments and its earnings and discounted cash flows, the markets in which the portfolio company does business, comparisons topublicly traded securities, and changes in the interest rate environment and the credit markets generally that may affect the price at which similar investmentsmay be made and other relevant factors. The primary method for determining enterprise value uses a multiple analysis whereby appropriate multiples areapplied to the portfolio company’s EBITDA or revenue. The enterprise value analysis is performed to determine the value of equity investments and todetermine if debt investments are credit impaired. If debt investments are credit impaired, the Company will use the enterprise value analysis or a liquidationbasis analysis to determine fair value. For debt investments that are not determined to be credit impaired, the Company uses a market interest rate yieldanalysis to determine fair value.In addition, for certain debt investments, the Company may base its valuation on quotes provided by an independent third party broker. Due to the inherent uncertainty of determining the fair value of Level 3 investments that do not have a readily available market value, the fair value of theinvestments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materiallyfrom the values that may ultimately be received or settled. Further, such investments are generally subject to legal and other restrictions or otherwise are lessliquid than publicly traded instruments. If the Company were required to liquidate a portfolio investment in a forced or liquidation sale, the Company mayrealize significantly less than the value at which such investment had previously been recorded. The Company’s investments are subject to market risk. Market risk is the potential for changes in the value due to market changes. Market risk is directlyimpacted by the volatility and liquidity in the markets in which the investments are traded.Changes in the market environment, portfolio company performance and other events that may occur over the lives of the investments may cause the gains orlosses ultimately realized on these investments to be materially different than the valuations currently assigned. We determine the fair value of eachindividual investment and record changes in fair value as unrealized appreciation or depreciation. Our investment portfolio is carried on the consolidatedstatements of assets and liabilities at fair value with any adjustments to fair value recognized as "Net unrealized appreciation (depreciation)" on theconsolidated statements of operations until the investment is realized, usually upon exit, resulting in any gain or loss being recognized as a "Net realizedgains (losses)."Our Board has the final responsibility for overseeing, reviewing and approving, in good faith, our determination of the fair value for our investment portfolioand our valuation procedures, consistent with 1940 Act requirements. We believe our investment portfolio as of December 31, 2017 and 2016 approximatesfair value as of those dates based on the markets in which we operate and other conditions in existence on those reporting dates.Income RecognitionInterest on loan investments is accrued and included in income based on contractual rates applied to principal amounts outstanding. Interest income isdetermined using a method that results in a level rate of return on principal amounts outstanding. When a loan becomes 90 days or more past due, or if weotherwise do not expect to receive interest and principal repayments, the loan is placed on non-accrual status and the recognition of interest income isdiscontinued. Interest payments received on loans that are on non-accrual status are treated as reductions of principal until the principal is repaid.We receive servicing income related to the guaranteed portions of SBA loan investments which we sell into the secondary market. These recurring fees areearned daily and recorded when earned. Servicing income is earned for the full term of the loan or until the loan is repaid.We receive a variety of fees from borrowers in the ordinary course of conducting our business, including packaging fees, legal fees, late fees and prepaymentfees. All other income is recorded when earned.Dividend income is recorded at the time dividends are declared. Distributions of earnings from a portfolio companies are evaluated to determine if thedistribution is income, return of capital or realized gain.Income Taxes Deferred tax assets and liabilities are computed based upon the differences between the financial statement and income tax basis of assets and liabilities usingthe enacted tax rates in effect for the year in which those temporary differences are expected to be realized or settled. If available evidence suggests that it ismore likely than not that some portion or all of the deferred tax91Table of Contentsassets will not be realized, a valuation allowance is required to reduce the deferred tax assets to the amount that is more likely than not to be realized.The Company’s U.S. federal and state income tax returns prior to fiscal year 2014 are generally closed, and management continually evaluates expiringstatutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings.The Company has elected to be treated as a RIC under the Code beginning with the 2015 tax year and operates in a manner so as to continue to qualify forthe tax treatment applicable to RICs. The RIC tax return includes Newtek Business Services Corp. and NSBF, a single member LLC disregarded for taxpurposes. None of the Company’s other subsidiaries are included in the RIC tax return. The Company will evaluate and record any deferred tax assets andliabilities of the subsidiaries that are not included in the RIC tax return. In order to maintain its RIC tax treatment, among other things, the Company isrequired to meet certain source of income and asset diversification requirements and timely distribute to its stockholders at least 90% of investment companytaxable income, as defined by the Code, for each tax year. The Company intends to make the requisite distributions to its stockholders, which will generallyrelieve the Company from U.S. federal income taxes with respect to any income that is distributed to its stockholders as dividends.Depending on the level of taxable income earned in a tax year, the Company may choose to retain taxable income in excess of current year dividenddistributions, and would distribute such taxable income in the next tax year. The Company would then pay a 4% excise tax on such income, as required. Tothe extent that the Company determines that its estimated current year annual taxable income, determined on a calendar year basis, could exceed estimatedcurrent calendar year dividend distributions, the Company accrues excise tax, if any, on estimated excess taxable income as taxable income is earned. For theyears ended December 31, 2017, 2016 and 2015, no U.S. federal excise taxes were due.The Company’s Taxable Subsidiaries accrue income taxes payable based on the applicable corporate rates on the net unrealized appreciation generated bythe controlled investments held by the Taxable Subsidiaries. Such deferred tax liabilities amounted to $8,164,000 and $5,983,000 at December 31, 2017 and2016, respectively, and are recorded as a deferred tax liabilities on the consolidated statements of assets and liabilities. The change in deferred tax liabilitiesis included as a component of net unrealized appreciation (depreciation) on investments in the consolidated statements of operations.New Accounting StandardsIn November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues TaskForce),” which requires that the statement of cash flow explain the change during the period in the total of cash, cash equivalents, and amounts generallydescribed as restricted cash or restricted cash equivalents. Amounts generally described as restricted cash and restricted cash equivalents should be includedwith cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This ASU iseffective for annual reporting periods beginning after December 15, 2017, and interim periods within those periods. Early adoption is permitted. This ASUwill not have a material impact on the Company’s consolidated financial statements and disclosures.In February 2016, the FASB issued ASU 2016-02, “Leases,” which amends various aspects of existing accounting guidance for leases, including therecognition of a right of use asset and a lease liability for leases with a duration of greater than one year. The ASU is effective for annual reporting periodsbeginning after December 15, 2018, and interim periods within those periods. Early adoption is permitted. The Company has not completed its review of thenew guidance; however, the Company anticipates that upon adoption of the standard it will recognize additional assets and corresponding liabilities relatedto leases on its consolidated statements of assets and liabilities.In January 2016, the FASB issued ASU 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets andFinancial Liabilities”, which, among other things, requires an entity to present separately in other comprehensive income the portion of the total change inthe fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value inaccordance with the fair value option for financial instruments. Additionally, the ASU changes the disclosure requirements for financial instruments. ThisASU is effective for annual reporting periods beginning after December 15, 2017, and interim periods within those periods, and early adoption is permittedfor certain provisions. The Company does not believe this ASU will have a material impact on its consolidated financial statements and disclosures.In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”. ASU 2014-09 supersedes the revenue recognitionrequirements under ASC 605, “Revenue Recognition”, and most industry-specific guidance92Table of Contentsthroughout the Industry Topics of the ASC. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promisedgoods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services.Under the new guidance, an entity is required to perform the following five steps: (1) identify the contract(s) with a customer; (2) identify the performanceobligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract, and(5) recognize revenue when (or as) the entity satisfies a performance obligation. The new guidance will significantly enhance comparability of revenuerecognition practices across entities, industries, jurisdictions and capital markets. Additionally, the guidance requires improved disclosures as to the nature,amount, timing and uncertainty of revenue that is recognized. In March 2016, the FASB issued ASU 2016-08, “Revenue from Contracts with Customers(Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)”, which clarified the implementation guidance on principal versusagent considerations. In April 2016, the FASB issued ASU 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying PerformanceObligations and Licensing”, which clarified the implementation guidance regarding performance obligations and licensing arrangements. In May 2016, theFASB issued ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606)—Narrow-Scope Improvements and Practical Expedients”, whichclarified guidance on assessing collectability, presenting sales tax, measuring noncash consideration, and certain transition matters. In December 2016, theFASB issued ASU No. 2016-20, “Revenue from Contracts with Customers (Topic 606)—Technical Corrections and Improvements”, which provideddisclosure relief, and clarified the scope and application of the new revenue standard and related cost guidance. The ASU is effective for annual reportingperiods beginning after December 15, 2017, and interim periods within that reporting period. The Company has evaluated the guidance under Topic 606 andexpects to identify similar performance obligations under ASC 606 as compared with deliverables and separate units of account previously identified. TheCompany evaluated each revenue stream and concluded that all were covered by the scope exceptions as detailed in Topic 606. As a result, the Companyexpects timing of its revenue recognition to remain the same.Subsequent EventsOn February 21, 2018, the Company closed a public offering of $50,000,000 in aggregate principal amount of its 2023 Notes. The 2023 Notes will mature onMarch 1, 2023 and may be redeemed in whole or in part at any time or from time to time at Newtek’s option on or after March 1, 2020. The 2023 Notes bearinterest at a rate of 6.25% per year payable quarterly on March 1, June 1, September 1 and December 1, of each year, beginning June 1, 2018. Total netproceeds received after deducting underwriters’ discount and expenses was $48,288,000. The 2023 Notes are listed on the Nasdaq Global Market under thetrading symbol “NEWTI” and were rated “A-“ by Egan-Jones. A portion of the proceeds will be used to redeem the outstanding 2021 Notes pending theconclusion of a 30-day notice period to existing holders of the 2021 Notes, expiring on March 23, 2018. In February 2018, the underwriters exercised theiroption to purchase an additional $7,500,000 in aggregate principal amount of the 2023 Notes resulting in an additional $7,275,000 in net proceeds.On February 21, 2018, the Company issued redemption notices to the holders of the 2021 Notes. The Company will redeem all $40,250,000 in aggregateprincipal amount of the Notes on the Redemption Date at 100% of their principal amount ($25 per Note), plus the accrued and unpaid interest thereon fromDecember 31, 2017, through, but excluding, the Redemption Date.On January 18, 2018, the Company declared a quarterly cash dividend of $0.40 per share payable on March 30, 2018 to shareholders of record as of March20, 2018. The dividend will be paid in cash or shares of the Company's common stock through participation in the Company's DRIP, at the election ofshareholders.Off Balance Sheet ArrangementsNone.Impact of InflationThe impact of inflation and changing prices on our results of operations is not material.ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.We consider the principal types of risk in our investing activities to be fluctuations in interest rates and loan portfolio valuations and the availability of thesecondary market for our SBA loans held for sale. Risk management systems and procedures are designed to identify and analyze our risks, to set appropriatepolicies and limits and to continually monitor these risks and limits by means of reliable administrative and information systems and other policies andprograms.93Table of ContentsNSBF primarily lends at an interest rate of prime, which resets on a quarterly basis, plus a fixed margin. The Capital One warehouse lines, securitization notesand related party debt are on a prime plus a fixed factor basis. As a result the Company believes it has matched its cost of funds to its interest income in itsfinancing activities. However, because of the differential between the amount lent and the smaller amount financed a significant change in market interestrates will have a material effect on our income. In periods of sharply rising interest rates, our cost of funds will increase at a slower rate than the interestincome earned on the loans we have made; this should improve our net investment income, holding all other factors constant. However, a reduction ininterest rates, as has occurred since 2008, has and will result in the Company experiencing a reduction in investment income; that is interest income willdecline more quickly than interest expense resulting in a net reduction of benefit to investment income.NSBF depends on the availability of secondary market purchasers for the guaranteed portions of SBA loans and the premium received on such sales tosupport its lending operations. At this time the secondary market for the guaranteed portions of SBA loans is robust but during the 2008 and 2009 financialcrisis the Company had difficulty selling its loans for a premium; although not expected at this time, if such conditions did recur, NSBF would most likelycease making new loans and could experience a substantial reduction in profitability.We do not have significant exposure to changing interest rates on invested cash which was approximately $20,547,000 at December 31, 2017. We do notpurchase or hold derivative financial instruments for trading purposes. All of our transactions are conducted in U.S. dollars and we do not have any foreigncurrency or foreign exchange risk. We do not trade commodities or have any commodity price risk.We believe that we have placed our demand deposits, cash investments and their equivalents with high credit-quality financial institutions. The Companyinvests cash not held in interest free checking accounts or bank money market accounts mainly in U.S. Treasury only money market instruments or funds andother investment-grade securities. As of December 31, 2017, cash deposits in excess of insured limits totaled approximately $5,609,000.ITEM 8. CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.Our consolidated financial statements and related notes begin on Page F-1, which are included in this Annual Report on Form 10-K.ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.None.ITEM 9A. CONTROLS AND PROCEDURES.(a) Evaluation of Disclosure Controls and ProceduresAs of December 31, 2017 (the end of the period covered by this report), we, including our Chief Executive Officer and Chief Accounting Officer, evaluatedthe effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the 1934 Act). Based on thatevaluation, our management, including our Chief Executive Officer and Chief Accounting Officer, concluded that our disclosure controls and procedureswere effective and provided reasonable assurance that information required to be disclosed in our periodic SEC filings is recorded, processed, summarizedand reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management,including our Chief Executive Officer and Chief Accounting Officer, as appropriate, to allow timely decisions regarding required disclosure. However, inevaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated canprovide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluatingthe cost-benefit relationship of possible controls and procedures.(b) Management’s Report on Internal Control over Financial ReportingManagement is responsible for establishing and maintaining adequate internal control over financial reporting, and for performing an assessment of theeffectiveness of internal control over financial reporting as of December 31, 2017. Internal control over financial reporting is a process designed to providereasonable assurance regarding the reliability of financial94Table of Contentsreporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The Company’sinternal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail,accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of thecompany are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assuranceregarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on thefinancial statements.Management performed an assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2017 based uponcriteria in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).Based on our assessment, management determined that the Company’s internal control over financial reporting was effective as of December 31, 2017 basedon the criteria in Internal Control — Integrated Framework (2013) issued by COSO.(c) Attestation Report of the Registered Public Accounting Firm.RSM US LLP, our independent registered public accounting firm, has issued an attestation report on the effectiveness of the Company’s internal control overfinancial reporting as of December 31, 2017, as stated in its report, which is included under “Item 8. Consolidated Financial Statements and SupplementaryData” of this annual report on Form 10-K.(d) Changes in Internal Control over Financial Reporting.There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Securities Exchange Act of 1934) thatoccurred during our most recently completed fiscal quarter, that have materially affected, or are reasonably likely to materially affect, our internal controlover financial reporting.ITEM 9B. OTHER INFORMATION.None.PART IIIITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.The information required by Item 10 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2018 Annual Meeting ofShareholders, to be filed with the Securities and Exchange Commission not later than 120 days following the end of our fiscal year.ITEM 11. EXECUTIVE COMPENSATIONThe information required by Item 11 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2018 Annual Meeting ofShareholders, to be filed with the Securities and Exchange Commission not later than 120 days following the end of our fiscal year.ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERSThe information required by Item 12 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2018 Annual Meeting ofShareholders, to be filed with the Securities and Exchange Commission not later than 120 days following the end of our fiscal year.ITEM 13. CERTAIN RELATIONSHIPS, RELATED PARTY TRANSACTIONS AND DIRECTOR INDEPENDENCE95Table of ContentsThe information required by Item 13 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2018 Annual Meeting ofShareholders, to be filed with the Securities and Exchange Commission not later than 120 days following the end of our fiscal year.ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICESThe information required by Item 14 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2018 Annual Meeting ofShareholders, to be filed with the Securities and Exchange Commission not later than 120 days following the end of our fiscal year.96Table of ContentsPART IVITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.(a)(1) Financial Statements.(a)(2) Exhibits.The following exhibits are filed herewith or are incorporated by reference to exhibits previously filed with the Securities andExchange Commission.Number Description 1.1 Form of Underwriting Agreement (Previously filed in connection with Pre-Effective Amendment No. 3 to the Registrant’s RegistrationStatement on Form N-2 (File No. 333-191499) filed on November 3, 2014, and incorporated by reference herein). 3.1 Amended and Restated Articles of Incorporation of Newtek Business Services Corp. (Previously filed in connection with Pre-EffectiveAmendment No. 3 to the Registrant’s Registration Statement on Form N-2 (File No. 333-191499) filed on November 3, 2014, andincorporated by reference herein). 3.2 Bylaws of Newtek Business Services Corp. (Incorporated by reference to Exhibit 99.2 to Registrant’s Registration Statement on Form N-14(File No. 333-195998), filed September 24, 2014). 4.1 Form of Common Stock Certificate (Incorporated by reference to Exhibit 99.5 to Registrant’s Registration Statement on Form N-14 (FileNo. 333-195998), filed September 24, 2014). 10.1 Form of Dividend Reinvestment Plan (Previously filed in connection with Pre-Effective Amendment No. 3 to the Registrant’s RegistrationStatement on Form N-2 (File No. 333-191499) filed on November 3, 2014, and incorporated by reference herein). 10.8.2 Guaranty of Payment and Performance, dated as of April 30, 2010, between Newtek Business Services, Inc. and Capital One Bank, N.A.(Incorporated herein by reference to Exhibit 10.16.2 to Newtek Business Services, Inc.’s Current Report on Form 8-K (File No. 001-16123),filed May 5, 2010). 10.9 Newtek Business Services Corp. 2014 Stock Incentive Plan (Incorporated herein by reference to Exhibit 8.6 to Registrant’s RegistrationStatement on Form N-14 (File No. 333-195998), filed September 24, 2014). 10.10.1 Loan and Security Agreement, dated as of December 15, 2010, between Newtek Small Business Finance, Inc. and Capital One Bank, N.A.(Incorporated herein by reference to Exhibit 10.18.1 to Newtek Business Services, Inc.’s Current Report on Form 8-K (File No. 001-16123),filed December 20, 2010, as amended on March 2, 2011). 10.10.2 Guaranty Agreement, dated as of December 15, 2010, between Newtek Business Services, Inc. and Capital One Bank, N.A. (Incorporatedherein by reference to Exhibit 10.18.2 to Newtek Business Services, Inc.’s Current Report on Form 8-K (File No. 001-16123), filedDecember 20, 2010, as amended on March 2, 2011). 10.10.3 Amended and Restated Loan and Security Agreement, dated as of June 16, 2011, by and between Newtek Small Business Finance, Inc. andCapital One, N.A. (Incorporated herein by reference to Exhibit 10.8.3 to Newtek Business Services, Inc.’s Current Report on Form 8-K (FileNo. 001-16123), filed June 21, 2011). 10.10.4 Amended and Restated Guaranty of Payment and Performance, dated as of June 16, 2011, by and between Newtek Business Services, Inc.,and Capital One, N.A. (Incorporated herein by reference to Exhibit 10.8.4 to Newtek Business Services, Inc.’s Current Report on Form 8-K(File No. 001-16123), filed June 21, 2011). 10.10.5 Amendment to Loan Documents, dated October 6, 2011, by and among Newtek Small Business Finance, Inc., Capital One Bank, N.A. andeach of the guarantors listed on the signature pages thereto (Incorporated herein by reference to Exhibit 10.8.5 to Newtek BusinessServices, Inc.’s Current Report on Form 8-K (File No. 001-16123), filed October 11, 2011). 10.10.6 Amended and Restated Loan and Security Agreement, dated as of July 16, 2013, by and between Newtek Small Business Finance, Inc. andCapital One, National Association (Incorporated herein by reference to Exhibit 10.1 to Newtek Business Services, Inc.’s Current Report onForm 8-K (File No. 001-16123), filed July 19, 2013). 10.10.7 Guaranty and Security Agreement Letter Amendment, dated as of July 16, 2013, by and between Capital One, National Association andNewtek Business Services, Inc. (Incorporated herein by reference to Exhibit 10.2 to Newtek Business Services, Inc.’s Current Report onForm 8-K (File No. 001-16123), filed July 19, 2013). 97Table of Contents10.10.8 Amended and Restated Loan and Security Agreement, dated as of October 29, 2014, by and between Newtek Small Business Finance, Inc.and Capital One, National Association (Incorporated herein by reference to Exhibit 10.1 to Newtek Business Services, Inc.’s Current Reporton Form 8-K (File No. 001-16123), filed October 30, 2014).10.10.9 First Amendment to Loan Documents, dated June 18, 2015, by and among Capital One, North America, Newtek Small Business Finance,LLC, Newtek Business Services Corp. and the other guarantors party thereto (Incorporated by reference to Exhibit 10.1 to Newtek BusinessServices Corp.’s Current Report on Form 8-K (File No. 814-01035), filed June 24, 2015. 10.10.10 Fourth Amended and Restated Loan and Security Agreement, dated as of May 11, 2017, by and among Newtek Small Business Finance,LLC, Capital One, National Association and UBS Bank USA as Lenders, and Capital One, National Association as Administrative Agent,Sole Bookrunner and Sole Lead Arranger (Incorporated by reference herein to Exhibit 10.1 to Newtek’s Current Report on Form 8-K, filedMay 16, 2017). 10.10.11 Second Amended and Restated Guaranty of Payment and Performance, dated as of May 11, 2017, delivered by Newtek Business ServicesCorp. in favor of Capital One, National Association, in its capacity as administrative agent, and the Lenders under the Fourth Amended andRestated Loan and Security Agreement (incorporated by reference herein to Exhibit 10.2 to Newtek’s Current Report on Form 8-K, filedMay 16, 2017). 10.10.12 Amended and Restated Guaranty of Payment and Performance, dated as of June 18, 2015, by and between Capital One, NationalAssociation and Newtek Business Services Corp. (Incorporated by reference to Exhibit 10.2 to Newtek Business Services Corp.’s CurrentReport on Form 8-K (File No. 814-01035), filed June 24, 2015. 10.10.13 Amended and Restated Credit and Guaranty Agreement, dated June 21, 2017, by and among Universal Processing Services of WisconsinLLC, CrystalTech Web Hosting, Inc., Small Business Lending, LLC, ADR Partners, LLC, Premier Payments LLC, Newtek Business ServicesCorp., Wilshire Holdings I, Inc., The Whitestone Group, LLC, Newtek Business Services Holdco 1, Inc., Banc-Serv Acquisition, Inc., certainsubsidiaries of Newtek Business Services Holdco 1, Inc. and Banc-Serv Acquisition, Inc., including Newtek LSP Holdco, LLC, CRY Sales,LLC and UPSWI Sales, LLC, the Lenders party thereto from time to time, Goldman Sachs Bank USA, as Administrative Agent andCollateral Agent, and Goldman Sachs Specialty Lending Group, L.P., as Lead Arranger (incorporated by reference to Exhibit 10.1 toNewtek’s Current Report on Form 8-K, filed June 23, 2017). 10.11.1 Newtek Small Business Loan Trust Class A Notes, dated December 22, 2010 (Incorporated herein by reference to Exhibit 10.19.1 to NewtekBusiness Services, Inc.’s Current Report on Form 8-K (File No. 001-16123), filed December 23, 2010). 10.11.2 Amended Newtek Small Business Loan Trust Class A Notes, dated December 29, 2011 (Incorporated herein by reference to Exhibit 10.19.2to Newtek Business Services, Inc.’s Current Report on Form 8-K (File No. 001-16123), filed January 5, 2012). 10.11.3 Additional Newtek Small Business Loan Trust Class A Notes, dated December 29, 2011 (Incorporated herein by reference to Exhibit10.19.3 to Newtek Business Services, Inc.’s Current Report on Form 8-K (File No. 001-16123), filed January 5, 2012). 10.12.2 Guaranty, dated as of February 28, 2011, by and between Newtek Business Services, Inc. and Sterling National Bank (Incorporated hereinby reference to Exhibit 10.10.2 to Newtek Business Services, Inc.’s Current Report on Form 8-K (File No. 001-16123), filed March 3, 2011). 10.13 Credit Agreement by and between Newtek Business Services, Inc. and Capital One, National Association, dated as of June 26, 2014(Incorporated herein by reference to Exhibit 10.1 to Newtek Business Services, Inc.’s Current Report on Form 8-K (File No. 001-16123),filed July 1, 2014). 10.14 Form of Custodian Agreement (Previously filed in connection with Pre-Effective Amendment No. 3 to the Registrant’s RegistrationStatement on Form N-2 (File No. 333-191499), filed on November 3, 2014, and incorporated by reference herein). 10.15 Newtek Small Business Loan Trust 2014-1 Class A Notes, dated December 3, 2014 (Incorporated herein by reference to Exhibit 10.1 toRegistrant’s Current Report on Form 8-K (File No. 814-01035), filed on December 5, 2014). 10.16 Amended and restated Form of Custody Agreement dated as of October 30, 2015 by and between Newtek Business Services Corp. and U.S.Bank National Association (Incorporated herein by reference to Exhibit 99.1 to Newtek Business Services Corp.’s Quarterly Report onForm 10-Q for the quarter ended September 30, 2015 (File No. 814-01035) filed on November 5, 2015. 10.17 Membership Purchase Agreement, dated July 23, 2015, by and among Newtek Business Services Corp., Newtek Business Services Holdco1,Inc., Premier Payments LLC and Jeffrey Rubin (Incorporated herein by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K (File No. 814-01035), filed on July 29, 2015). 98Table of Contents10.18 Base Indenture, dated as of September 23, 2015, between Newtek, as issuer, and U.S. Bank National Association, as trustee (Incorporated byreference to Exhibit D.2 to Newtek’s Post-Effective Amendment No. 1 to its Registration Statement on Form N-2, No. 333-204915, filedSeptember 23, 2015). 10.19 First Supplemental Indenture, dated as of September 23, 2015, between Newtek, as issuer, and U.S. Bank National Association, as trustee(Incorporated by reference to Exhibit D.3 to Newtek’s Post-Effective Amendment No. 1 to its Registration Statement on Form N-2, No. 333-204915, filed September 23, 2015). 10.20 Form of Global Note with respect to the 7.5% Notes due 2022 (Included as Exhibit A of Exhibit D.3) (Incorporated by reference to ExhibitD.4 to Newtek’s Post-Effective Amendment No. 1 to its Registration Statement on Form N-2, No. 333-204915, filed September 23, 2015). 10.21 Second Supplemental Indenture, dated as of April 22, 2016, between Newtek, as issuer, and U.S. Bank National Association, as trustee(Incorporated by reference to Exhibit D.6 to Post-Effective Amendment No. 3 to its Registration Statement on Form N-2, No. 333-204915,filed April 22, 2016). 10.22 Form of Global Note with respect to the 7.00% Notes due 2021 (Included as Exhibit A of Exhibit D.5) (Incorporated by reference to ExhibitD.6 to Post-Effective Amendment No. 3 to its Registration Statement on Form N-2, No. 333-204915, filed April 22, 2016). 10.23 Statement of Eligibility of Trustee on Form T-1 (Incorporated by reference to Exhibit d.7 to Newtek’s Pre-Effective Amendment No. 2 to itsRegistration Statement on Form N-2, No 333-212436, filed August 25, 2016). 10.24 Third Supplemental Indenture, dated as of February 21, 2018, between Newtek, as issuer, and U.S. Bank National Association, as trustee(Previously filed in connection with Post-Effective Amendment No. 7 to the Registrant’s Registration Statement on Form N-2 (File No.333-212436), filed February 21, 2018). 10.25 Form of Global Note with respect to the 6.25% Notes due 2023 (Incorporated by reference to Exhibit d.8 to Newtek’s Post-EffectiveAmendment No. 7 to its Registration Statement on Form N-2, No 333-212436, filed February 21, 2018). 11 Computation of Per Share Earnings (included in the notes to the consolidated financial statements in this report)14.1 Code of Ethics (Previously filed in connection with Pre-Effective Amendment No. 3 to the Registrant’s Registration Statement on Form N-2(File No. 333-191499) filed on November 3, 2014, and incorporated by reference herein). 21.1 Subsidiaries of the Registrant filed herewith. 31.1 Certification by Principal Executive Officer required by Rule 13a-14 under the Securities Exchange Act of 1934, as amended, filedherewith. 31.2 Certification by Principal Financial Officer required by Rule 13a-14 under the Securities Exchange Act of 1934, as amended, filedherewith. 32.1 Certification by Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-OxleyAct of 2002 filed herewith. 32.2 Certification by Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-OxleyAct of 2002 filed herewith. 99.1 Financial Statements of Universal Processing Services of Wisconsin, LLC and Subsidiary as of and for the year ended December 31, 2017(unaudited) (filed herewith). 99.2 Financial Statements of Universal Processing Services of Wisconsin, LLC as of and for the year ended December 31, 2016 (audited) (filedherewith). 99.3 Financial Statements of Universal Processing Services of Wisconsin, LLC and Subsidiary as of and for the year ended December 31, 2015(audited) (filed herewith).99Table of ContentsSIGNATURESPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on itsbehalf by the undersigned, thereunto duly authorized. NEWTEK BUSINESS SERVICES CORP. Date: March 16, 2018By:/S/ BARRY SLOANE Barry Sloane Chairman and Chief Executive Officer(Principal Executive Officer) Date: March 16, 2018By:/S/ JENNIFER EDDELSON Jennifer Eddelson Chief Accounting Officer(Principal Financial Officer and Principal Accounting Officer)In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on thedates indicated.SignatureTitleDate /S/ BARRY SLOANEChairman of the Board, President and Chief Executive Officer (PrincipalExecutive Officer)March 16, 2018Barry Sloane /S/ JENNIFER EDDELSONChief Accounting Officer (Principal Financial Officer and PrincipalAccounting Officer)March 16, 2018Jennifer Eddelson /S/ RICHARD SALUTEDirectorMarch 16, 2018Richard Salute /S/ SALVATORE MULIA DirectorMarch 16, 2018Salvatore Mulia /S/ GREGORY ZINKDirectorMarch 16, 2018Gregory Zink /S/ PETER DOWNSDirectorMarch 16, 2018Peter Downs100Table of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIESINDEX TO CONSOLIDATED FINANCIAL STATEMENTSTable of Contents PAGE NO. Report of Independent Registered Public Accounting FirmF-1 Report of Independent Registered Public Accounting Firm on Internal Control Over Financial ReportingF-2 Consolidated Statements of Assets and Liabilities as of December 31, 2017 and 2016F-3 Consolidated Statements of Operations for the years ended December 31, 2017, 2016 and 2015F-4 Consolidated Statements of Changes in Net Assets for the years ended December 31, 2017, 2016 and 2015F-5 Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016 and 2015F-7 Consolidated Schedules of Investments as of December 31, 2017 and 2016F-9 Notes to Consolidated Financial StatementsF-166101Table of ContentsReport of Independent Registered Public Accounting FirmTo the Board of Directors and StockholdersNewtek Business Services Corp. and SubsidiariesOpinion on the Financial StatementsWe have audited the accompanying consolidated statements of assets and liabilities, including the consolidated schedules of investments, of NewtekBusiness Services Corp. and Subsidiaries (the Company) as of December 31, 2017 and 2016, and the related consolidated statements of operations, changesin net assets and cash flows for each of the three years in the period ended December 31, 2017, and the related notes to the consolidated financial statements(collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Companyas of December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2017, inconformity with accounting principles generally accepted in the United States of America.We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company'sinternal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control - Integrated Framework issued by theCommittee of Sponsoring Organizations of the Treadway Commission in 2013, and our report dated March 16, 2018, expressed an unqualified opinion onthe effectiveness of the Company’s internal control over financial reporting. Basis for OpinionThese financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financialstatements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Companyin accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonableassurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing proceduresto assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also includedevaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financialstatements. Our procedures included confirmation of investments owned as of December 31, 2017 and 2016, by correspondence with the borrowers or byother appropriate auditing procedures where replies from the borrowers were not received and with respect to controlled investments. We believe that ouraudits provide a reasonable basis for our opinion. /s/ RSM US LLP We have served as the Company's auditor since 2013. New York, New YorkMarch 16, 2018F-1Table of ContentsReport of Independent Registered Public Accounting FirmTo the Board of Directors and StockholdersNewtek Business Services Corp. and SubsidiariesOpinion on the Internal Control Over Financial ReportingWe have audited Newtek Business Services Corp. and Subsidiaries’ (the Company) internal control over financial reporting as of December 31, 2017, basedon criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in2013. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based oncriteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidatedstatements of assets and liabilities of the Company, including the consolidated schedules of investments, as of December 31, 2017 and 2016, and the relatedconsolidated statements of operations, changes in net assets, and cash flows for each of the three years in the period ended December 31, 2017, and our reportdated March 16, 2018 expressed an unqualified opinion.Basis for OpinionThe Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness ofinternal control over financial reporting in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is toexpress an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with thePCAOB and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules andregulations of the Securities and Exchange Commission and the PCAOB.We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining anunderstanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design andoperating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary inthe circumstances. We believe that our audit provides a reasonable basis for our opinion.Definition and Limitations of Internal Control Over Financial ReportingA company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal controlover financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are beingmade only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention ortimely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliancewith the policies or procedures may deteriorate./s/ RSM US LLPNew York, New YorkMarch 16, 2018F-2Table of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES(In Thousands, except for Per Share Data) December 31, 2017 2016ASSETS Investments, at fair value SBA unguaranteed non-affiliate investments (cost of $287,690 and $219,784, respectively; includes $265,174and $197,927, respectively, related to securitization trusts)$278,034 $211,471SBA guaranteed non-affiliate investments (cost of $22,841 and $10,262, respectively)25,490 11,512Controlled investments (cost of $59,898 and $41,001, respectively)153,156 121,302Non-control/non-affiliate investments (cost of $0 and $904, respectively)— 904Investments in money market funds (cost of $9 and $35, respectively)9 35Total investments at fair value456,689 345,224Cash2,464 2,051Restricted cash18,074 20,845Broker receivable8,539 2,402Due from related parties2,255 3,748Servicing assets, at fair value19,359 16,246Other assets12,231 10,934Total assets$519,611 $401,450LIABILITIES AND NET ASSETS Liabilities: Bank notes payable$— $5,100Notes due 2022 (Note 8)7,936 7,853Notes due 2021 (Note 8)39,114 38,767Notes payable - Securitization trusts (Note 8)162,201 118,122Notes payable - related parties7,001 1,400Due to related parties— 1,227Deferred tax liabilities8,164 5,983Accounts payable, accrued expenses and other liabilities16,866 13,904Total liabilities241,282 192,356Commitments and contingencies (Note 9) Net assets: Preferred stock (par value $0.02 per share; authorized 1,000 shares, no shares issued and outstanding)— —Common stock (par value $0.02 per share; authorized 200,000 shares, 18,457 and 14,624 issued andoutstanding, respectively369 293Additional paid-in capital247,363 188,472Undistributed net investment income14,792 8,092Net unrealized appreciation, net of deferred taxes20,448 13,008Net realized losses(4,643) (771)Total net assets278,329 209,094Total liabilities and net assets$519,611 $401,450Net asset value per common share$15.08 $14.30 F-3See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS(In Thousands, except for Per Share Data) Year endedDecember 31, 2017 Year endedDecember 31, 2016 Year endedDecember 31, 2015Investment income From non-affiliate investments: Interest income$18,018 $11,158 $8,924Servicing income7,206 6,160 4,611Other income3,236 2,714 1,929Total investment income from non-affiliate investments28,460 20,032 15,464From controlled investments: Interest income653 360 277Dividend income9,747 10,573 10,218Other income54 — 111Total investment income from controlled investments10,454 10,933 10,606Total investment income38,914 30,965 26,070Expenses: Salaries and benefits19,292 15,234 12,753Interest11,397 8,440 6,479Depreciation and amortization402 296 326Professional fees3,009 3,274 3,053Origination and servicing5,871 6,046 4,331Change in fair value of contingent consideration liabilities(455) — —Other general and administrative costs7,279 6,935 5,313Total expenses46,795 40,225 32,255Net investment loss(7,881) (9,260) (6,185)Net realized and unrealized gains (losses): Net realized gain on non-affiliate investments39,617 31,512 28,386Net realized (loss) gain on controlled investments(200) 108 5,473Net unrealized appreciation (depreciation) on SBA guaranteed non-affiliateinvestments1,398 1,035 (3,215)Net unrealized (depreciation) appreciation on SBA unguaranteed non-affiliateinvestments(1,342) 18 1,183Net unrealized appreciation on controlled investments12,957 11,337 12,250Change in deferred taxes(2,179) (5,128) (857)Net unrealized depreciation on non-control/non-affiliate investments— (43) (24)Net unrealized depreciation on servicing assets(3,394) (2,269) (1,268)Net unrealized depreciation on credits in lieu of cash and notes payable in creditsin lieu of cash— (5) (7)Net realized and unrealized gains46,857 36,565 41,921Net increase in net assets resulting from operations$38,976 $27,305 $35,736Net increase in net assets resulting from operations per share$2.25 $1.88 $3.32Net investment loss per share$(0.45) $(0.64) $(0.57)Dividends and distributions declared per common share$1.64 $1.53 $4.45Weighted average number of shares outstanding17,327 14,541 10,770F-4See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS(In Thousands) December 31,2017 December 31, 2016 December 31, 2015Increase in net assets: Net investment loss$(7,881) $(9,260) $(6,185)Net realized gains on investments39,417 31,620 33,859Net change in unrealized appreciation7,440 4,945 8,062Net increase in net assets resulting from operations38,976 27,305 35,736Distributions to common stockholders: Dividends to common stockholders from net investment income(24,866) — —Distributions to common stockholders from net realized gains(4,068) (22,163) (20,912)Special dividend— — (9,195)Total distributions to common stockholders(28,934) (22,163) (30,107)Capital share transactions: Issuance of common stock under dividend reinvestment plan735 665 288Stock-based compensation expense963 578 —Repurchase of common stock under share repurchase plan— (866) —Issuance of common stock in connection with investment in Premier Payments LLC— — 2,472Issuance of common stock in connection with legal settlement— — 215Issuance of common stock in connection with investment in InternationalProfessional Marketing, Inc.1,000 — —Issuance of common stock in connection with investment in United Capital Source,LLC500 — —Purchase of vested stock for employee payroll tax withholding(667) — Issuance of common stock, net of offering costs56,662 — 35,290Net increase in net assets from capital share transactions59,193 377 38,265Other transactions: Consolidation of Exponential Business Development Co., Inc. (Note 2)— (376) —Adjustment for 2014 offering costs— — 17Consolidation of The Texas Whitestone Group, LLC and CCC Real Estate Holdings,LLC— — (33)Return of dividends related to common stock issued in connection with litigationsettlement— 2 —Reversal of deferred tax asset— — (2,870)Distribution to members of Exponential of New York, LLC— — (2,677)F-5See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS(In Thousands) December 31,2017 December 31,2016 December 31,2015Out of period adjustment related to BDC Conversion— — (800)Net decrease in net assets from other transactions— (374) (6,363)Total increase in net assets69,235 5,145 37,531Net assets at beginning of period209,094 203,949 166,418Net assets at end of period (includes $14,792 of undistributed net investment income)$278,329 $209,094 $203,949Common shares outstanding at end of period18,457 14,624 14,509Capital share activity: Shares issued under dividend reinvestment plan44 58 17Shares issued in connection with public offerings3,727 — 2,300Shares issued in connection with legal settlement— — 11Shares issued in connection with investment in Premier Payments LLC— — 131Shares issued in connection with investment in International Professional Marketing,Inc.60 — —Shares issued in connection with investment in United Capital Source, LLC29 — —Shares repurchased under share repurchase plan— (70) —Purchase of vested stock for employee payroll tax withholding(39) — —Shares issued in connection with special dividend— — 1,844Restricted shares issued under Equity Incentive Plan, net of forfeitures12 127 —Net increase in common shares from capital share activity3,833 115 4,303F-6See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS(In Thousands) December 31, 2017 December 31,2016 December 31,2015Cash flows from operating activities: Net increase in net assets resulting from operations$38,976 $27,305 $35,736Adjustments to reconcile net increase in net assets resulting from operations to net cash usedin operating activities: Net unrealized appreciation on controlled investments(12,957) (11,337) (12,250)Net unrealized (appreciation) depreciation on non-affiliate investments(56) (1,010) 2,056Net unrealized depreciation on servicing assets3,394 2,269 1,268Realized losses (gains) on controlled investments200 (108) (5,473)Realized gains on non-affiliate investments(40,511) (32,437) (29,573)Realized losses on non-affiliate investments894 925 1,189Allowance for doubtful accounts1,397 — —Change in fair value of contingent consideration liabilities(455) — —Amortization of deferred financing costs1,392 1,327 1,318Deferred income taxes2,179 5,128 857Depreciation and amortization402 296 326Purchase of loans from SBA(6,469) (2,057) (703)Purchase of SBA 7(a) loan portfolio(175) — —Funding of controlled investments(32,320) (8,595) (17,100)Funding of non-control/non-affiliate investment(3,255) (1,020) (2,200)Funding of guaranteed non-affiliate SBA loans(296,120) (234,908) (185,443)Proceeds from sale of non-affiliate SBA loans324,141 258,873 240,663Funding of unguaranteed non-affiliate SBA loans(89,762) (74,239) (57,053)Distributions received from investments in excess of basis100 108 5,473Principal received from non-control/non-affiliate investment3,255 751 353Return of investment from controlled investments50 535 3,746Principal received from controlled investments16,846 4,052 1,200Payments received on SBA non-affiliate investments27,035 22,106 20,086Other, net908 1,385 (188)Changes in operating assets and liabilities: Investment in money market funds26 — 2,965Broker receivable(6,137) 29,681 (32,083)Due to/from related parties(1,131) (158) (2,477)Other assets(632) (191) 5,013Accounts payable, accrued expenses and other liabilities2,374 2,708 1,725Change in restricted cash4,450 3,187 (12,655)Capitalized servicing asset(6,506) (5,474) (4,827)Other, net(19) (14) 100Net cash used in operating activities(68,486) (10,912) (37,951)Cash flows from investing activities: Purchase of fixed assets(446) (375) (105)Proceeds from sale of intangible asset— — 407F-7See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS(In Thousands) December 31, 2017 December 31,2016 December 31,2015Net cash (used in) provided by investing activities(446) (375) 302Cash flows from financing activities: Net borrowings on bank lines of credit(5,100) (24,000) (4,756)Proceeds from common shares sold, net of offering costs56,662 — 35,290Net borrowings (repayments) on related party line of credit5,601 (4,247) 5,647Repurchase of common stock under share repurchase plan— (866) —Payments on bank note payable— — (9,167)Proceeds from Notes due 2022— — 8,324Proceeds from Notes due 2021— 40,250 —Payments on Notes Payable - Securitization Trusts(31,036) (24,379) (19,993)Issuance of Notes Payable - Securitization Trusts75,426 53,444 32,029Dividends paid(28,198) (27,300) (15,111)Special dividend paid— — (9,195)Change in restricted cash related to securitization(1,678) (1,163) 5,175Additions to deferred financing costs(1,664) (2,695) (1,409)Exponential of New York, LLC distributions to members— — (2,673)Purchase of vested stock for employee payroll tax withholding(667) — —Other, net(1) (14) (17)Net cash provided by financing activities69,345 9,030 24,144Net increase (decrease) in cash and cash equivalents413 (2,257) (13,505)Cash and cash equivalents—beginning of year$2,051 $4,308 $17,813Cash and cash equivalents—end of year$2,464 $2,051 $4,308Supplemental disclosure of cash flow activities: Cash paid for interest$9,996 $6,687 $4,617Non-cash investing and financing activities: Reduction of credits in lieu of cash and notes payable in credits in lieu of cash balancesdue to delivery of tax credits to Certified Investors$— $869 $1,394Fixed assets acquired from tenant improvement allowance$— $1,288 $—Foreclosed real estate acquired$503 $447 $1,130Dividends declared but not paid during the year$— $— $5,802Reversal of deferred tax asset$— $— $2,870Issuance of common shares in connection with investment in Premier Payments LLC$— $— $2,472Issuance of common shares in connection with investment in International ProfessionalMarketing, Inc.$1,000 $— $—Issuance of common shares in connection with investment in United Capital Source, LLC$500 $— $—Issuance of common shares in connection with legal settlement$— $— $215Issuance of common shares under dividend reinvestment plan$735 $665 $288Out of period adjustment in connection with BDC Conversion$— $— $800F-8See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssetsPerforming SBA UnguaranteedInvestments (1) Farec, Inc Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 12/29/2042 $281.2 $281.2 $286.1 0.10%Best Choice Meats, Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/29/2027 65.0 65.0 65.1 0.02%Social Link LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/29/2027 11.3 11.3 9.8 —%Morrocco Method, Inc ChemicalManufacturing Term Loan Prime plus2.75% 12/27/2042 861.3 861.3 876.0 0.31%Anglin Cultured Stone ProductsLLC Construction ofBuildings Term Loan Prime plus2.75% 12/27/2042 643.8 643.8 623.7 0.22%Landmark Ventures USA Inc Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 12/22/2027 62.5 62.5 54.3 0.02%^Salida Family Chiropractic-PPLCdba Salida Sport and Spine Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/22/2027 12.0 12.0 10.4 —%^Lab Partner, LLC and BeechtreeDiagnostics, LLP and CottonwoodDiagnostics Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/22/2027 778.3 778.3 685.7 0.25%^TrialHawk Litigation Group LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/22/2027 15.8 15.8 13.7 —%Gorilla Warfare LLC Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 12/22/2027 22.5 22.5 20.4 0.01%^Advance Case Parts Inc Repair andMaintenance Term Loan Prime plus2.75% 12/22/2027 50.0 50.0 47.3 0.02%Muckamuck Trucks, Inc. TruckTransportation Term Loan Prime plus2.75% 12/22/2027 13.8 13.8 13.0 —%O'Rourke's Diner, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/22/2027 3.8 3.8 3.6 —%^Dudeck Enterprise LLC dba DetailGarage Las Vegas Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 12/22/2027 16.1 16.1 16.4 0.01%Driven Warehouse/Distribution LLC TruckTransportation Term Loan Prime plus2.75% 12/22/2027 750.0 750.0 652.1 0.23%Bisson Transportation Inc TruckTransportation Term Loan Prime plus2.75% 12/22/2027 75.0 75.0 72.6 0.03%Anderson Farms Inc TruckTransportation Term Loan Prime plus2.75% 12/22/2027 1,250.0 1,250.0 1,098.6 0.39%F-9See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Medical Plaza of Boro Park PC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/22/2027 62.5 62.5 54.3 0.02%Jacliff Investments Inc PublishingIndustries (exceptInternet) Term Loan Prime plus2.75% 12/22/2027 50.0 50.0 43.5 0.02%^Street Magic Enterprise LLC Gasoline Stations Term Loan Prime plus2.75% 12/21/2027 87.8 87.8 84.2 0.03%^Tropical Stone LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/21/2027 187.5 187.5 191.8 0.07%Ameco Forest Products LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/21/2027 175.0 175.0 179.0 0.06%DHD Enterprise LLC dba EdibleArrangements #1699 Miscellaneous StoreRetailers Term Loan Prime plus2.75% 12/21/2027 8.4 8.4 8.1 —%^Blue Lagoon Resort, LLC dbaHill View Cottages Accommodation Term Loan Prime plus2.75% 12/21/2042 188.8 188.8 201.1 0.07%^CT Auto Spa LLC Repair andMaintenance Term Loan Prime plus2.75% 12/21/2027 215.6 215.6 216.2 0.08%^DBMS Consulting, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/20/2027 75.0 75.0 70.9 0.03%^Auto Excellance of Fort MyersInc. Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 12/19/2042 106.3 106.3 113.2 0.04%^CZAR Industries, Inc. MachineryManufacturing Term Loan Prime plus2.75% 12/19/2027 262.5 262.5 243.1 0.09%Best Quality Home Care LLC Nursing andResidential CareFacilities Term Loan Prime plus2.75% 12/19/2027 8.0 8.0 6.9 —%^Dr. Richard R. Rolle, Jr., PLLCdba Rolle Oral & Facial Surgery Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/18/2027 125.0 125.0 117.3 0.04%Neville Galvanizing, Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 12/15/2042 625.0 625.0 626.2 0.22%^Ocean Trans LLC & DehalTrucking LLC TruckTransportation Term Loan Prime plus2.75% 12/15/2042 610.0 610.0 591.6 0.21%^1-0 Granny's Helpful Hands,LLC Nursing andResidential CareFacilities Term Loan Prime plus2.75% 12/15/2027 22.5 22.5 19.7 0.01%^Galaforo Construction andCompanies LLC Construction ofBuildings Term Loan Prime plus2.75% 12/15/2042 208.5 208.5 212.3 0.08%^Crystal II Auto Glass Inc Repair andMaintenance Term Loan Prime plus2.75% 12/15/2027 15.0 15.0 13.1 —%Demand Printing Solutions Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 12/15/2027 17.7 17.7 16.6 0.01%^Galaforo Construction LLC andPaul M Galaforo, Jr. Construction ofBuildings Term Loan Prime plus2.75% 12/15/2027 337.5 337.5 293.5 0.11%F-10See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Legion Bowl, Inc & Legion PubInc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/15/2042 333.6 333.6 355.5 0.13%^Montessori Community School Social Assistance Term Loan Prime plus2.75% 12/15/2027 62.5 62.5 58.6 0.02%^Capital Containers LLC TruckTransportation Term Loan Prime plus2.75% 12/15/2027 22.5 22.5 20.0 0.01%^JMD Aviation Holdings, LLC Rental and LeasingServices Term Loan Prime plus2.75% 12/15/2027 500.0 500.0 498.0 0.18%^Peanut Butter & Co., Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/15/2027 225.0 225.0 195.6 0.07%Royalty Freight Inc TruckTransportation Term Loan Prime plus2.75% 12/14/2027 668.8 668.8 581.5 0.21%^KR Calvert & Co, LLC Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 12/14/2027 468.0 468.0 408.6 0.15%^Atlas Geo-Constructors, LLC Specialty TradeContractors Term Loan Prime plus2.75% 12/14/2027 304.0 304.0 290.0 0.10%^LP Industries Inc. dbaChildforms Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 12/14/2027 75.0 75.0 72.1 0.03%Beale Street Blues CompanyInc.dba Beatle Street BluesCompany, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 12/14/2027 968.8 968.8 849.1 0.31%^Hana Pastries Enterprises LLCdba Hana Kitchens, Hana Pastries,Inc. FoodManufacturing Term Loan Prime plus2.75% 12/14/2027 96.5 96.5 94.3 0.03%^AADJ Empire Inc and AADJGalaxy Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 12/14/2042 181.3 181.3 179.0 0.06%^Heung Kyun Im Nonstore Retailers Term Loan Prime plus2.75% 12/14/2027 15.5 15.5 13.4 —%^Barcade Holdings, LLC ,BarcadeLLC,& Barcade New Haven LLC Management ofCompanies andEnterprises Term Loan Prime plus2.75% 12/14/2027 125.0 125.0 109.7 0.04%^Hardway Inc & AFC Leasing Inc Rental and LeasingServices Term Loan Prime plus2.75% 12/13/2027 937.5 937.5 815.2 0.29%^Nichols Fire and Security LLC Administrative andSupport Services Term Loan Prime plus2.75% 12/13/2042 87.5 87.5 88.3 0.03%Polymer Dynamics, Inc and CarlBent Repair andMaintenance Term Loan Prime plus2.75% 12/12/2027 72.5 72.5 73.2 0.03%^LPB Property Management Incdba Wilderness View Cabins &Ellijay Cabin Real Estate Term Loan Prime plus2.75% 12/12/2042 100.0 100.0 105.9 0.04%A-1 Van Services Inc Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 12/12/2027 719.8 719.8 690.0 0.25%F-11See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Clore Construction LLC Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 12/12/2027 462.5 462.5 437.6 0.16%^Sky Way Enterprises, Inc, A-Liner-8-Aviation, Inc, KissimmeeAviation Air Transportation Term Loan Prime plus2.75% 12/12/2027 500.0 500.0 434.8 0.16%^Jai Ganeshai LLC, Mahiveera 1LLC, Mahiveera 2 LLC & KSVPLLC Gasoline Stations Term Loan Prime plus2.75% 12/12/2027 50.0 50.0 43.5 0.02%^Big Picture Group LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/12/2027 375.0 375.0 339.7 0.12%^The Ohio Valley Group Inc dbaOhio Valley Landscapes & Design Administrative andSupport Services Term Loan Prime plus2.75% 12/12/2027 15.0 15.0 13.5 —%^Clear Sound Communications,Inc Administrative andSupport Services Term Loan Prime plus2.75% 12/8/2027 3.8 3.8 3.3 —%^AV Strategy Inc Rental and LeasingServices Term Loan Prime plus2.75% 12/8/2027 442.5 442.5 410.7 0.15%^JVLS LLC dba Vaccines 2 Go Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/7/2027 15.0 15.0 13.0 —%^Kim Howard Corp dba NPNMachine Tools Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 12/7/2042 575.0 575.0 609.8 0.22%^IHC Hardware Inc. Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 12/6/2042 100.0 100.0 97.5 0.04%^Earth First Recycling LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/6/2027 75.0 75.0 74.3 0.03%^ODS Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/6/2027 49.0 49.0 45.0 0.02%^Driven Powersports, Inc Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 12/6/2027 87.5 87.5 76.1 0.03%^Affordable Auto Transport LLC TruckTransportation Term Loan Prime plus2.75% 12/5/2027 7.5 7.5 6.8 —%^Healthcare Interventions, Inc Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/4/2027 15.0 15.0 13.0 —%Oil Palace, Inc. Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 12/4/2042 818.4 818.4 872.1 0.31%^PS Camping Inc. Accommodation Term Loan Prime plus2.75% 12/1/2027 19.7 19.7 19.7 0.01%^Linda Jean Howard Riley dba TheRusty Bolt Gift Shop Miscellaneous StoreRetailers Term Loan Prime plus2.75% 12/1/2042 21.0 21.0 22.4 0.01%^Salud Bar & Grill LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/1/2027 56.3 56.3 49.2 0.02%F-12See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssetsUtara LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/1/2027 6.4 6.4 6.6 —%^Square 1 Partners, LLC PublishingIndustries (exceptInternet) Term Loan Prime plus2.75% 12/1/2027 62.5 62.5 54.3 0.02%^Fortress Verve Inc, Maurice R.Margules and Antonie C. Reinhard Miscellaneous StoreRetailers Term Loan Prime plus2.75% 11/30/2027 131.3 131.3 129.2 0.05%^Frontier Sand LLC Mining (except Oiland Gas) Term Loan Prime plus2.75% 11/30/2027 500.0 500.0 487.9 0.18%^WTI Distribution Inc Support Activitiesfor Transportation Term Loan Prime plus2.75% 11/30/2027 40.0 40.0 37.5 0.01%^Create- A- Stitch, Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 11/30/2042 87.5 87.5 91.8 0.03%^J. Venture Holdings, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/30/2027 12.5 12.5 12.7 —%^Skin Beauty Bar Inc. and TamekaJ. Mathis Personal andLaundry Services Term Loan Prime plus2.75% 11/30/2027 9.0 9.0 8.1 —%^Clearwater Transportation LTDdba Thrifty Car Rental, Dollar RentA Car Rental and LeasingServices Term Loan Prime plus2.75% 11/29/2027 172.5 172.5 153.3 0.06%^Our Playhouse Preschool, LLC Social Assistance Term Loan Prime plus2.75% 11/29/2042 235.0 235.0 250.4 0.09%^OPH Lexington, Inc Social Assistance Term Loan Prime plus2.75% 11/29/2042 193.8 193.8 206.5 0.07%Amped Coffee Company LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/28/2027 3.8 3.8 3.8 —%Beacon Brewing LLC and C' Sons,LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/27/2042 50.4 50.4 53.7 0.02%^JMD Corporation dba Dart's TrueValue Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/22/2027 18.8 18.8 17.6 0.01%^Webtez Inc dba Mod Vans Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 11/22/2027 70.0 70.0 61.2 0.02%^Step Up Academy of the Arts,LLC EducationalServices Term Loan Prime plus2.75% 11/22/2027 15.8 15.8 13.7 —%PB Market LLC dba Pure Barre EducationalServices Term Loan Prime plus2.75% 11/21/2027 108.5 108.5 94.5 0.03%^Cali Fit Meals Food Services andDrinking Places Term Loan Prime plus2.75% 11/21/2027 22.5 22.5 21.1 0.01%^Vision Collision Center LLC Repair andMaintenance Term Loan Prime plus2.75% 11/21/2027 408.8 408.8 380.1 0.14%^Grumpy's Restaurant Company,LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/21/2027 71.1 71.1 62.0 0.02%F-13See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Glencadia Corporation Personal andLaundry Services Term Loan Prime plus2.75% 11/21/2027 3.8 3.8 3.3 —%^B Lam LLC Personal andLaundry Services Term Loan Prime plus2.75% 11/20/2042 181.3 181.3 188.1 0.07%N Transport LLC TruckTransportation Term Loan Prime plus2.75% 11/20/2027 410.0 410.0 356.5 0.13%N Transport LLC TruckTransportation Term Loan Prime plus2.75% 11/20/2042 176.3 176.3 160.8 0.06%^TPE Midstream LLC, DashamCompany dba Sahm Co & S & SVentures Inc. Rental and LeasingServices Term Loan Prime plus2.75% 11/17/2027 189.1 189.1 180.9 0.06%^Maya Motel, LLC dba TownHouse Motel Accommodation Term Loan Prime plus2.75% 11/17/2042 57.0 57.0 60.7 0.02%^Southern Specialty Contractor,LLC & Ronald David Holbrook Jr. Specialty TradeContractors Term Loan Prime plus2.75% 11/17/2027 53.0 53.0 46.5 0.02%^SSI Refrigerated Express Inc. andRobert M Stallone TruckTransportation Term Loan Prime plus2.75% 11/17/2027 64.0 64.0 56.9 0.02%^Jacob's Towing, Inc. Support Activitiesfor Transportation Term Loan Prime plus2.75% 11/17/2027 50.0 50.0 45.5 0.02%^Ian Winterbotham dba FurnishingAmerica Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 11/17/2027 253.9 253.9 220.8 0.08%^H & H Hotshot Services, Inc. Couriers andMessengers Term Loan Prime plus2.75% 11/16/2027 70.0 70.0 63.5 0.02%Murf & Sons LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/16/2027 60.1 60.1 55.1 0.02%^J R Wholesale Tires & AutoCenter, LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 11/15/2042 13.5 13.5 14.4 0.01%^Marcaco LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 11/15/2042 677.5 677.5 701.0 0.25%^Auto Rx LLC,J&P Auto RepairInc Repair andMaintenance Term Loan Prime plus2.75% 11/15/2042 196.3 196.3 207.2 0.07%Paramount Dance Studios Inc. andHomestead Dance Supply Educational Services Term Loan Prime plus2.75% 5/14/2043 216.0 216.0 229.7 0.08%^GFA International Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/13/2027 93.8 93.8 95.9 0.03%^Wing King at the Gardens LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/10/2027 9.8 9.8 8.5 —%^Linqserv Inc. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 11/9/2027 617.5 617.5 581.9 0.21%^Bobcatt Solutions, LLC Specialty TradeContractors Term Loan Prime plus2.75% 11/8/2027 95.0 95.0 88.8 0.03%F-14See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Hofgard & Co, Inc dba HofgardBenefits and James Marsh Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 11/8/2027 14.9 14.9 13.0 —%^JNP Delivery Inc Couriers andMessengers Term Loan Prime plus2.75% 11/7/2027 112.5 112.5 104.0 0.04%^Street Magic Enterprise LLC dbaNew Lisbon Travel Mart Gasoline Stations Term Loan Prime plus2.75% 11/7/2042 420.0 420.0 428.8 0.15%^His Loving Hands ChristianAcademy, Inc. Social Assistance Term Loan Prime plus2.75% 11/6/2042 91.8 91.8 95.2 0.03%^S & S Auto Body Shop Inc. Repair andMaintenance Term Loan Prime plus2.75% 11/3/2042 165.0 165.0 173.8 0.06%^Sterling Campbell InsuranceAgency, Inc Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 11/3/2027 7.5 7.5 6.5 —%^Top Quality Dent Service LLC Repair andMaintenance Term Loan Prime plus2.75% 11/2/2027 6.0 6.0 5.2 —%^American Reclamation LLC Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 11/1/2027 7.5 7.5 7.3 —%^ Edge Studios Inc Radiant YogaLLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 11/1/2027 66.3 66.3 58.9 0.02%Berza TLG,LLC dba The LittleGym of Lake Charles Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/31/2027 24.3 24.3 21.9 0.01%^Rachael Reel dba Rachel ReelInsurance Age Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 10/31/2027 7.5 7.5 6.5 —%^The Five Lakes LLC Educational Services Term Loan Prime plus2.75% 10/30/2042 474.4 474.4 505.5 0.18%^Die Hard Used Car Sales Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 10/30/2042 56.2 56.2 59.9 0.02%^Hip Hop Style Inc dba SereneHaven Personal andLaundry Services Term Loan Prime plus2.75% 10/27/2027 16.5 16.5 14.8 0.01%^Blue Eagle Transport Inc ,Golden Eagle Transport, Inc &Green Eagle Transport Couriers andMessengers Term Loan Prime plus2.75% 10/27/2027 37.3 37.3 33.4 0.01%^Sage Oil LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 10/27/2027 9.9 9.9 8.8 —%^Ashore Ventures Inc dbaPuroClean Professional Restoration Repair andMaintenance Term Loan Prime plus2.75% 10/27/2027 14.5 14.5 12.9 —%^Cardinal Homes, Inc Wood ProductManufacturing Term Loan Prime plus2.75% 10/27/2027 108.8 108.8 110.9 0.04%^Suzie LLC dba Tony D'sRestaurant Food Services andDrinking Places Term Loan Prime plus2.75% 10/25/2042 87.4 87.4 91.6 0.03%F-15See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^White Walker LLC dba Frenchette Food Services andDrinking Places Term Loan Prime plus2.75% 10/25/2027 276.6 276.6 282.9 0.10%^Grand Blanc Lanes, Inc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/25/2027 14.9 14.9 15.3 0.01%^Schafer Fisheries Inc FoodManufacturing Term Loan Prime plus2.75% 10/25/2027 34.9 34.9 35.7 0.01%^The Jig, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 10/24/2042 75.7 75.7 78.0 0.03%^Action Physical Therapy Yogaand Wellness Center Inc. Ambulatory HealthCare Services Term Loan Prime plus2.75% 10/24/2027 22.4 22.4 21.6 0.01%^Florida Apnea Diagnostics LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 10/20/2027 155.3 155.3 137.6 0.05%^Berens & Miller P. A. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 10/19/2027 149.1 149.1 129.7 0.05%^Alpha Auto Sales, LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 10/19/2027 79.5 79.5 81.3 0.03%^Island Refrigeration & AC Inc Specialty TradeContractors Term Loan Prime plus2.75% 10/18/2042 141.5 141.5 143.6 0.05%Looky Enterprises, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 10/18/2027 17.2 17.2 16.5 0.01%^H and K Dry Cleaning LLC,Quintero Shopping Center LLC,Aqua Laundry Electronics andAppliance Stores Term Loan 7.75% 10/17/2042 66.8 66.8 71.2 0.03%^Blueridge Armor LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 10/17/2027 8.2 8.2 7.6 —%^Albas Bar & Grill LLC Food Services andDrinking Places Term Loan Prime plus2.75% 10/13/2042 44.9 44.9 44.0 0.02%^Cortez Landscaping, LLC Administrative andSupport Services Term Loan Prime plus2.75% 10/13/2027 19.1 19.1 17.6 0.01%^Crawfordsville Fitness LLC dbaPlanet Fitness Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/13/2027 123.4 123.4 110.1 0.04%^On Call Services LLC Construction ofBuildings Term Loan Prime plus2.75% 10/13/2027 17.9 17.9 18.3 0.01%^JD Ventures LLC and JD Roof CoLLC Specialty TradeContractors Term Loan Prime plus2.75% 10/12/2027 22.4 22.4 19.9 0.01%Pro Anderson, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/11/2027 19.3 19.3 17.5 0.01%^Sandbox Ventures LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/11/2027 18.6 18.6 18.1 0.01%F-16See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Eye Optique Inc. Health and PersonalCare Stores Term Loan Prime plus2.75% 10/5/2027 14.9 14.9 13.0 —%^Ains Holding Company LLC Management ofCompanies andEnterprises Term Loan Prime plus2.75% 10/2/2027 80.8 80.8 72.1 0.03%^Becky Lou Corp dba Rent ACenter Rental and LeasingServices Term Loan Prime plus2.75% 10/2/2027 90.7 90.7 83.8 0.03%^Dan Cline Transport Inc. TruckTransportation Term Loan Prime plus2.75% 9/29/2030 997.5 997.5 895.7 0.32%^Lone Star Hardware and HomeDecor, LLC Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 9/29/2027 71.7 71.7 62.6 0.02%^Threads of Time LLC Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 9/29/2042 137.2 137.2 137.7 0.05%^Miechella Suzette Decker Miscellaneous StoreRetailers Term Loan Prime plus2.75% 9/29/2042 99.8 99.8 106.2 0.04%^Harco Metal Products Inc Primary MetalManufacturing Term Loan Prime plus2.75% 9/29/2042 490.8 490.8 474.1 0.17%^Chicago AmericanManufacturing LLC, DocksideSteel Processing, LLC Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/29/2042 1,249.3 1,249.3 1,276.6 0.46%^Sashshel Corporation Food Services andDrinking Places Term Loan Prime plus2.75% 9/29/2042 212.0 212.0 225.8 0.08%^Dr Richard Rolle JR, PLLC dbaRolle Oral & Facial Surgery PLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/29/2042 873.9 873.9 871.8 0.31%^Cagwin Trucking LLC TruckTransportation Term Loan Prime plus2.75% 9/29/2042 324.2 324.2 339.1 0.12%^Pets A Go Go LLC Personal andLaundry Services Term Loan Prime plus2.75% 9/28/2042 197.6 197.6 204.1 0.07%^Rhode Island TennisManagement LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/28/2042 548.6 548.6 549.6 0.20%^Moreno Brother's Inc. Food and BeverageStores Term Loan Prime plus2.75% 9/28/2027 14.8 14.8 12.9 —%^National Media Services, Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/28/2027 18.5 18.5 16.1 0.01%^Rhode Island TennisManagement LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/28/2042 382.0 382.0 382.8 0.14%^Nicholson Lumber Co Inc. Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 9/28/2030 213.3 213.3 211.4 0.08%F-17See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Complete Care IT LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/27/2027 14.6 14.6 12.7 —%^Technologist Inc Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 9/27/2027 429.4 429.4 410.0 0.15%^Rollins Construction & TruckingLLC Construction ofBuildings Term Loan Prime plus2.75% 9/26/2027 337.2 337.2 330.4 0.12%^Inspirations Food Design, Inc Food Services andDrinking Places Term Loan Prime plus2.75% 9/26/2042 464.9 464.9 472.1 0.17%^JPS Arthur Kill Rd Bakery Corpdba Aunt Butches of Brooklyn Food Services andDrinking Places Term Loan Prime plus2.75% 9/22/2027 22.2 22.2 19.5 0.01%^KB Waterjet Cutting LLC Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/22/2027 10.1 10.1 9.2 —%^Magnation Corporation Utilities Term Loan Prime plus2.75% 9/22/2027 49.4 49.4 50.5 0.02%^Sallee Pro-Custom FabricationShop LLC Repair andMaintenance Term Loan Prime plus2.75% 9/21/2027 8.9 8.9 9.1 —%^Excel, RP Inc. MachineryManufacturing Term Loan Prime plus2.75% 9/20/2027 98.8 98.8 91.8 0.03%^Denek Contracting Inc andDenek Leasing LLC Specialty TradeContractors Term Loan Prime plus2.75% 9/20/2042 209.5 209.5 223.1 0.08%^Max Home Deliveries, Inc Couriers andMessengers Term Loan Prime plus2.75% 9/20/2027 79.8 79.8 73.5 0.03%CR Park Incorporated dba DefineBody and Mind Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/20/2027 47.6 47.6 44.4 0.02%^Sound Manufacturing, Inc. &Monster Power Equipment, Inc. Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/20/2027 197.8 197.8 188.3 0.07%^Alpha Preparatory AcademyLLC Social Assistance Term Loan Prime plus2.75% 9/20/2042 162.1 162.1 162.0 0.06%^Montessori Community School Social Assistance Term Loan Prime plus2.75% 9/20/2042 390.8 390.8 384.2 0.14%^Alexander Pierce Corporation Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/20/2042 623.4 623.4 626.8 0.23%^NY Tent LLC & NY Tent Parent,LLC dba Tent Company of NewYork Rental and LeasingServices Term Loan Prime plus2.75% 9/20/2027 1,015.5 1,015.5 974.1 0.35%^Imagine By Carleen, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 9/20/2027 7.4 7.4 7.2 —%^Commonwealth DiagnosticsInternational, Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/20/2027 1,250.0 1,250.0 1,277.5 0.46%^Venus Pizza, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 9/20/2042 91.0 91.0 96.9 0.03%F-18See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Insight Diagnostic TechnologistServices Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/20/2027 299.4 299.4 270.7 0.10%^CIS Big Dog, LLC Administrative andSupport Services Term Loan Prime plus2.75% 9/19/2027 60.5 60.5 60.8 0.02%^Stone's Construction andRemodeling, LLC Specialty TradeContractors Term Loan Prime plus2.75% 9/19/2027 5.2 5.2 4.5 —%^Party By Design Inc. Personal andLaundry Services Term Loan Prime plus2.75% 9/18/2042 1,203.7 1,203.7 1,199.5 0.43%^Li Family Spokane LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/15/2042 383.5 383.5 398.4 0.14%^SD Kickboxing LLC dba CKOKickboxing Dan Diego Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/15/2027 39.5 39.5 35.9 0.01%^Clark Realty LLC Real Estate Term Loan Prime plus2.75% 9/15/2027 61.8 61.8 57.0 0.02%^Inglis Food Mart Inc. Food and BeverageStores Term Loan Prime plus2.75% 9/15/2027 22.2 22.2 22.2 0.01%^Clinton Food Market LLC Gasoline Stations Term Loan Prime plus2.75% 9/15/2042 262.2 262.2 264.4 0.09%^Tarleton & Family Landscaping,LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/15/2027 82.8 82.8 74.3 0.03%^Alaska Motor Home Inc Rental and LeasingServices Term Loan Prime plus2.75% 9/13/2027 327.6 327.6 284.6 0.10%^Fox Valley Rentals &Investments, LLC Food Services andDrinking Places Term Loan Prime plus3.75% 9/13/2027 7.4 7.4 7.5 —%^Nails By Mercede LLC Personal andLaundry Services Term Loan Prime plus2.75% 9/13/2027 14.1 14.1 13.2 —%^Town & Country TransportationCo. and Popco, LLC. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/12/2042 168.3 168.3 179.3 0.06%^Rajbai Maa Inc. dba NaraLounge Food Services andDrinking Places Term Loan Prime plus2.75% 9/12/2042 387.1 387.1 378.7 0.14%^Morgan Lynn Kerstetter dbaCatherine School of Dance Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 9/11/2027 7.4 7.4 7.6 —%^Health & Performance Center,LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/11/2027 20.2 20.2 17.5 0.01%^Foxtail, LLC and Tottly NewServices Corp Social Assistance Term Loan Prime plus2.75% 9/8/2042 290.5 290.5 294.0 0.11%^Desert Ribs, LLC and FamousCharlie, LLC and FamousFreddie, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/8/2042 1,250.0 1,250.0 1,191.0 0.43%F-19See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Echelon Planning Group, LLCdba Echelon Financial Services Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 9/8/2027 7.4 7.4 7.3 —%^Crazy Beatz Productions LLC Motion Picture andSound RecordingIndustries Term Loan Prime plus3.75% 9/7/2027 5.3 5.3 4.9 —%^South Fulton Landscape &Nursery, Inc. Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 9/7/2042 99.8 99.8 106.2 0.04%^Dreaming Big Learning CenterInc Social Assistance Term Loan Prime plus2.75% 9/5/2042 367.8 367.8 371.9 0.13%^Big Coop's Trucking LLC TruckTransportation Term Loan Prime plus2.75% 9/1/2027 98.8 98.8 93.4 0.03%^Blue Eagle Transport Inc,Greeneagle Transport Inc &Golden Eagle Transport Couriers andMessengers Term Loan Prime plus2.75% 8/31/2027 376.7 376.7 336.9 0.12%^Evernook Valley Milk LLC Animal Productionand Aquaculture Term Loan Prime plus2.75% 8/31/2042 640.1 640.1 643.7 0.23%^Bark Life, Inc. Miscellaneous StoreRetailers Term Loan Prime plus2.75% 8/31/2027 22.1 22.1 19.2 0.01%^The Pink Alli, LLC dba The Alli Miscellaneous StoreRetailers Term Loan Prime plus2.75% 8/30/2027 17.7 17.7 15.9 0.01%^Busby Outdoor LLC Real Estate Term Loan Prime plus2.75% 8/29/2042 697.4 697.4 636.6 0.23%^Busby Outdoor LLC Real Estate Term Loan Prime plus2.75% 8/29/2042 547.9 547.9 500.2 0.18%^Parlay Disributors LLC Educational Services Term Loan Prime plus2.75% 8/25/2027 110.5 110.5 97.5 0.04%^Lake County Tow LLC Support Activitiesfor Transportation Term Loan Prime plus2.75% 8/25/2042 87.2 87.2 87.6 0.03%^InUSA Ventures Inc dba InUSAServices Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 8/24/2027 24.6 24.6 21.3 0.01%^Genuine Ventures LLC andSeaweed Ventures LLC Food Services andDrinking Places Term Loan Prime plus2.75% 8/24/2030 551.0 551.0 519.3 0.19%^R & R Strength & ConditioningCorp dba Crossfit Light HousePoint Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 8/23/2042 82.2 82.2 87.5 0.03%^Delicias de Minas Restaurant,LLC Food Services andDrinking Places Term Loan Prime plus2.75% 8/22/2027 203.0 203.0 199.5 0.07%^The Holder Grooup LLC Repair andMaintenance Term Loan Prime plus2.75% 8/22/2027 7.4 7.4 6.4 —%F-20See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^L&V Auto Sales, Inc. Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 8/21/2027 17.7 17.7 18.1 0.01%^M.E. Interiors LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/21/2027 16.2 16.2 14.1 0.01%^Damiano Global Corp Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/21/2027 22.1 22.1 20.9 0.01%^Tier1Solutions, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/18/2027 18.4 18.4 16.6 0.01%^Tony Herring & Associates, Inc Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 8/17/2027 7.4 7.4 6.4 —%^Chester's World Enterprise LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 8/16/2027 22.1 22.1 20.1 0.01%^D'Amato & Sons Construction,Inc. Specialty TradeContractors Term Loan Prime plus2.75% 8/11/2027 8.1 8.1 7.4 —%^HTP LLC dba Hot TomatoesPizza Food Services andDrinking Places Term Loan Prime plus2.75% 8/11/2027 11.1 11.1 10.4 —%^Roundhay Partners LLC andRoundhay Farming LLC Crop Production Term Loan Prime plus2.75% 8/8/2042 909.1 909.1 837.7 0.30%^Splashlight LLC, SplashlightPhotographic and Digital Studios,LLC Management ofCompanies andEnterprises Term Loan Prime plus2.75% 8/7/2027 491.2 491.2 442.3 0.16%^L & J Corporate Services Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/4/2027 7.3 7.3 6.4 —%^Furniture Masters LimitedLiability Company Repair andMaintenance Term Loan Prime plus2.75% 8/3/2027 8.8 8.8 7.7 —%^HMG Strategy LLC, Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/2/2027 49.1 49.1 42.7 0.02%^Bowl Mor LLC dba Bowl MorLanes Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 7/31/2027 7.3 7.3 6.4 —%^Hope Health Care, LLC Nursing andResidential CareFacilities Term Loan Prime plus2.75% 7/31/2027 10.3 10.3 8.9 —%^Royal Blue Investments, Inc. andCleland Pharmacy LLC Health and PersonalCare Stores Term Loan Prime plus2.75% 7/31/2042 52.7 52.7 55.1 0.02%^Raffi's Inc dba Atlantic AutoCenter Repair andMaintenance Term Loan Prime plus2.75% 7/31/2027 13.9 13.9 13.9 —%^Sharon G McMillen, MAPsychologist, Inc. Ambulatory HealthCare Services Term Loan Prime plus2.75% 7/28/2027 18.2 18.2 15.8 0.01%F-21See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Work of Heart Inc.dba Little NestPortraits Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 7/28/2027 50.0 50.0 43.7 0.02%^HQTRONIC LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 7/27/2027 22.0 22.0 19.1 0.01%^Oberon IT, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 7/26/2027 213.6 213.6 196.7 0.07%^Gilles Peress Studio LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 7/25/2027 61.0 61.0 53.0 0.02%^Ocean Trans LLC TruckTransportation Term Loan Prime plus2.75% 7/21/2027 36.6 36.6 31.8 0.01%^Obok LLC Food Manufacturing Term Loan Prime plus2.75% 7/21/2027 11.7 11.7 11.0 —%^Lil Tots' Learning Center LLC Social Assistance Term Loan Prime plus2.75% 7/21/2042 47.3 47.3 47.6 0.02%^Nova Solutions, Inc. Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 7/19/2027 24.4 24.4 24.0 0.01%^Webb Eye Associates, PA Ambulatory HealthCare Services Term Loan Prime plus2.75% 7/19/2027 72.4 72.4 69.2 0.02%^Matrix Z LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus3.75% 7/19/2027 7.3 7.3 7.6 —%^Aitheras Aviation Group, LLC,Aitheras Aviation Group, LLC Air Transportation Term Loan Prime plus2.75% 7/18/2027 805.2 805.2 704.2 0.25%^Wildflour Bakery & Cafe, LLC Food Manufacturing Term Loan Prime plus2.75% 7/17/2027 22.0 22.0 22.5 0.01%^Florida Home and Kitchen LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 7/14/2027 11.7 11.7 10.2 —%^Koep Companies dba PipestoneTrue value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 7/14/2042 324.9 324.9 320.7 0.12%^Rocks Auto Exchange LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 7/13/2027 14.6 14.6 12.7 —%^McCord Holdings, Inc. dba FastSigns 176101 Administrative andSupport Services Term Loan Prime plus2.75% 7/7/2027 18.3 18.3 16.3 0.01%^Thrifty Market Inc dba ThriftyFoods Food and BeverageStores Term Loan Prime plus2.75% 7/6/2027 100.1 100.1 91.1 0.03%^New Chicago Wholesale BakeryInc. Food Manufacturing Term Loan Prime plus2.75% 6/30/2027 14.6 14.6 13.9 —%^Safeguard ConstructionCompany, Inc. Construction ofBuildings Term Loan Prime plus2.75% 6/30/2027 74.0 74.0 63.5 0.02%F-22See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^The Country House Restaurant,LLC and Pelton Real Estate, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2042 49.7 49.7 51.5 0.02%^Qycell Corporation Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 6/30/2027 74.0 74.0 75.3 0.03%^J. T. O'Neill Company, L.L.C Real Estate Term Loan Prime plus2.75% 6/30/2027 14.6 14.6 12.5 —%^Hamilton & Associates RealEstate and Investments Firm LLC Real Estate Term Loan Prime plus2.75% 6/30/2042 53.7 53.7 54.5 0.02%^BQRS, Inc. DBA GreshamMeineke Car Care Center Repair andMaintenance Term Loan Prime plus2.75% 6/30/2027 60.7 60.7 53.2 0.02%^JWH Designs, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/30/2027 103.1 103.1 88.5 0.03%^Veola's Day Spa and WellnessCenter Inc. Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/30/2027 8.9 8.9 8.0 —%^J&M Civil Construction ServicesLLC Specialty TradeContractors Term Loan Prime plus2.75% 6/30/2027 97.2 97.2 83.4 0.03%^Best Bees Company Animal Productionand Aquaculture Term Loan Prime plus2.75% 6/29/2027 21.8 21.8 18.7 0.01%^Greensboro Plastic SurgicalAssociates, PA Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/29/2042 574.7 574.7 572.1 0.21%^Ocean Trans LLC and DehalTrucking LLC TruckTransportation Term Loan Prime plus2.75% 6/29/2027 584.7 584.7 502.0 0.18%^HG Ventures, Inc. dba DiamondHead Trucking TruckTransportation Term Loan Prime plus2.75% 6/29/2030 988.2 988.2 857.9 0.31%^Malhame & Company Publishers& Importers Inc. MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 6/29/2027 87.5 87.5 75.2 0.03%^Intellixion LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/29/2027 3.6 3.6 3.1 —%^Steigelbauer Associates Inc. Specialty TradeContractors Term Loan Prime plus2.75% 6/29/2027 299.9 299.9 305.3 0.11%^Miguel Fernando Borda PA dbaBGR Dental Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/29/2027 49.4 49.4 44.2 0.02%^Oakhill Farms, LLC Specialty TradeContractors Term Loan Prime plus2.75% 6/29/2030 98.0 98.0 100.2 0.04%^ElKareh Brothers Investment,LLC, Best Choice Meats Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 6/29/2027 435.5 435.5 443.3 0.16%^Foxhop Fitness, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/28/2027 90.3 90.3 78.4 0.03%F-23See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Akal Express Inc. dba TruckTrailer Service Stop Repair andMaintenance Term Loan Prime plus2.75% 6/28/2042 59.6 59.6 62.0 0.02%^Old Dominion TransportationGroup, Inc. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 6/28/2027 1,099.8 1,099.8 966.4 0.35%^Citibin, Inc. Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 6/27/2027 121.3 121.3 104.2 0.04%^Auxiliary Systems Inc.,SharrickCompany, LLC & KMN, LLC TransportationEquipmentManufacturing Term Loan Prime plus2.75% 6/27/2030 240.3 240.3 239.6 0.09%^WB Cleaners Inc. DBA $2.75Cleaners Personal andLaundry Services Term Loan Prime plus2.75% 6/27/2027 21.8 21.8 21.5 0.01%^Ains Holding Company, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/26/2027 1,141.1 1,141.1 1,003.3 0.36%^Four Seasons Laser Center Inc. Personal andLaundry Services Term Loan Prime plus2.75% 6/26/2042 216.3 216.3 216.7 0.08%^Rustic LLC Personal andLaundry Services Term Loan Prime plus2.75% 6/23/2042 18.6 18.6 16.8 0.01%^Vella Construction Enterprises,Inc. dba Vella Construction Construction ofBuildings Term Loan Prime plus2.75% 6/23/2027 21.8 21.8 18.7 0.01%^Northern Industries, LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 6/23/2042 57.4 57.4 60.8 0.02%^Birches Group, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/22/2027 48.5 48.5 41.7 0.01%^Tarver-Henley Inc. and Tar-HenLLC Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 6/21/2042 317.9 317.9 316.7 0.11%^704 Meat Center Inc. dba ElMercado and La Plaza Mercado Food and BeverageStores Term Loan Prime plus2.75% 6/20/2042 173.9 173.9 180.6 0.06%^Sanabi Investment, LLC dbaOscar's Moving and Storage TruckTransportation Term Loan Prime plus2.75% 6/20/2027 120.4 120.4 109.1 0.04%^Scarlet Spartan Inc.dba FastSignsof Brighton Administrative andSupport Services Term Loan Prime plus2.75% 6/19/2027 54.0 54.0 47.6 0.02%^Don G. Timpton DDS &Associates PA and IndsaadProperties,LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/16/2042 397.4 397.4 383.2 0.14%^JAM Media Solutions, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/15/2027 60.7 60.7 52.1 0.02%^All Regional Recyclers of WoodLLC dba ARROW,SuperiorCarting, LLC Waste Managementand RemediationServices Term Loan Prime plus2.75% 6/15/2042 312.0 312.0 309.3 0.11%^Tele Tax Express Inc., El RanchoPaiso, LLC and Nestor Romero Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/14/2042 91.9 91.9 95.0 0.03%F-24See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Susan Hughes dba AlohaJunction B and B Accommodation Term Loan Prime plus2.75% 6/14/2042 61.6 61.6 65.4 0.02%^ESA 365 Corp and LucathorRealty LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/14/2042 22.4 22.4 22.7 0.01%^Hull's Kitchen, LLC and HK Too,LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/14/2042 95.8 95.8 101.0 0.04%^Yachting Solutions LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 6/12/2027 115.2 115.2 108.3 0.04%^Refoleen Inc dba Spice and TeaExchange Food and BeverageStores Term Loan Prime plus2.75% 6/8/2027 3.4 3.4 2.9 —%^Earth First Recycling, LLC and191 Clark Road, LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 6/5/2027 344.7 344.7 345.5 0.12%^Skydive California, LLC Educational Services Term Loan Prime plus2.75% 6/2/2027 53.4 53.4 54.3 0.02%^SCW, LLC dba Arthur MurrayDance Studio Educational Services Term Loan Prime plus2.75% 6/2/2042 145.0 145.0 145.7 0.05%^Speaker City, Inc.and SpeakerTown, LLC dba Rollin Thunder Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 6/1/2042 45.4 45.4 46.4 0.02%^Impact Grounds Maintenanceand Design, Inc. dba ImpactLandscaping Administrative andSupport Services Term Loan Prime plus2.75% 5/31/2042 78.9 78.9 82.2 0.03%^Ricnet III, Inc. dba EdibleArrangements Food and BeverageStores Term Loan Prime plus2.75% 5/31/2027 14.3 14.3 12.5 —%^Sage Oil LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 5/31/2027 21.7 21.7 18.9 0.01%^Funtime, LLC and UniversalEntertainment Group LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 5/31/2027 63.9 63.9 55.8 0.02%^Haroon Baig,Inc.dba US1 Petrol Gasoline Stations Term Loan Prime plus2.75% 5/31/2042 261.9 261.9 277.8 0.10%^Chet Lemon Enterprises LLC dbaAll American Sports Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 5/26/2042 786.2 786.2 833.9 0.30%Swantown Inn & Spa LLC Accommodation Term Loan Prime plus2.75% 5/26/2042 81.9 81.9 86.9 0.03%^Eagle Wood Works LLC Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 5/26/2027 11.6 11.6 10.6 —%^Hurricane Group, Inc. Other InformationServices Term Loan Prime plus2.75% 5/26/2027 72.3 72.3 62.1 0.02%^Mitchell Auto Repair, LLC andand C&M Mitchell, LLC Repair andMaintenance Term Loan Prime plus2.75% 5/26/2042 192.7 192.7 197.9 0.07%^Demand Printing Solutions Inc. Printing and RelatedSupport Activities Term Loan Prime plus2.75% 5/25/2027 205.7 205.7 193.9 0.07%F-25See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Beyond Waves A Unique SalonLLC and Lori Ann Carlson Personal andLaundry Services Term Loan Prime plus2.75% 5/25/2027 14.5 14.5 12.6 —%^Jung Design Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 5/25/2027 8.7 8.7 7.5 —%^Abdul Naushad MD PC dbaAdvanced Pain Centers Ambulatory HealthCare Services Term Loan Prime plus2.75% 5/25/2042 390.6 390.6 403.4 0.14%^Locavore LLC dba PalomaRestaurant Food Services andDrinking Places Term Loan Prime plus2.75% 5/25/2027 48.2 48.2 43.0 0.02%^Shaffer Automotive Repair, LLC Repair andMaintenance Term Loan Prime plus2.75% 5/24/2030 133.5 133.5 125.0 0.04%^Juliador Resources LLC DBA CueHair Salon and Skin Care Personal andLaundry Services Term Loan Prime plus2.75% 5/24/2027 21.9 21.9 18.8 0.01%^Innovim, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 5/24/2027 325.4 325.4 279.4 0.10%^Southeast Recycling, LLC andSoutheast Land Holdings LLC dba67 Motor Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 5/23/2042 179.9 179.9 189.1 0.07%^Gill Express Inc. and Gill Express2 LLC Repair andMaintenance Term Loan Prime plus2.75% 5/23/2042 336.1 336.1 333.7 0.12%^Prestige Construction of Florida,LLC Construction ofBuildings Term Loan Prime plus2.75% 5/23/2042 333.7 333.7 326.0 0.12%^Enfield Tractor & Equipment Co Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 5/19/2027 285.9 285.9 274.2 0.10%^PS Camping, Inc. dba ProspectorsRV Resort Accommodation Term Loan Prime plus2.75% 5/19/2042 255.7 255.7 269.8 0.10%^GEM2K, LLC dba PrecisionPrecast Group MiscellaneousManufacturing Term Loan Prime plus2.75% 5/19/2027 156.7 156.7 140.4 0.05%^Hayden Trucking LLC TruckTransportation Term Loan Prime plus2.75% 5/19/2027 253.2 253.2 233.5 0.08%^Tres K Deli,Grocery,Fruit andMeat Inc. Food and BeverageStores Term Loan Prime plus2.75% 5/19/2027 8.0 8.0 7.4 —%^ Iron Men Home Repair, Inc. andIronmen House Lifting Inc. Specialty TradeContractors Term Loan Prime plus2.75% 5/19/2042 577.9 577.9 585.9 0.21%^J Harris Trucking LLC TruckTransportation Term Loan Prime plus2.75% 5/19/2027 18.8 18.8 17.9 0.01%^New Image Building Services,Inc. Administrative andSupport Services Term Loan Prime plus2.75% 5/18/2027 145.4 145.4 129.7 0.05%^Bay Car Wash LLC Repair andMaintenance Term Loan Prime plus2.75% 5/18/2042 119.8 119.8 121.8 0.04%F-26See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Waterford Plumbing Co, Inc. Specialty TradeContractors Term Loan Prime plus2.75% 5/18/2027 48.2 48.2 42.2 0.02%^Mr. B's Bicycles & Mopeds, Inc. Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 5/18/2042 145.6 145.6 146.8 0.05%^Computech Computers Inc. EducationalServices Term Loan Prime plus2.75% 5/17/2027 48.2 48.2 41.4 0.01%^Arco Electrical Contractors Inc.dba Arco Construction Group Specialty TradeContractors Term Loan Prime plus2.75% 5/16/2027 347.9 347.9 319.7 0.11%^Batter & Company,LLC dbaBatter Co. Dessert Collection Food and BeverageStores Term Loan Prime plus2.75% 5/16/2027 51.8 51.8 45.5 0.02%^5 Stars Learning Center Inc Social Assistance Term Loan Prime plus2.75% 5/16/2042 61.3 61.3 61.9 0.02%^Band Sawn Lumber,LLC andNathan Ryan Adams Wood ProductManufacturing Term Loan Prime plus2.75% 5/15/2042 112.8 112.8 111.6 0.04%^Keys Armored Express, Inc. Administrative andSupport Services Term Loan Prime plus2.75% 5/12/2027 38.6 38.6 34.6 0.01%^Sanderson Distribution Inc. TruckTransportation Term Loan Prime plus2.75% 5/12/2027 10.1 10.1 8.7 —%^SG Linke LLC Clothing andClothingAccessories Stores Term Loan Prime plus2.75% 5/12/2027 106.3 106.3 104.7 0.04%^B G F Bobby Q's Inc Food Services andDrinking Places Term Loan Prime plus2.75% 5/11/2027 7.2 7.2 7.1 —%^Estelle Finkel EducationalAssociates,LLC EducationalServices Term Loan Prime plus2.75% 5/11/2027 115.1 115.1 98.8 0.04%^Labmates,LLC Miscellaneous StoreRetailers Term Loan Prime plus2.75% 5/10/2027 96.4 96.4 92.3 0.03%^NHS, LLC Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 5/9/2027 85.3 85.3 76.7 0.03%^NHS, LLC Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 5/9/2042 21.7 21.7 20.4 0.01%^Innovation Transport, LLC TruckTransportation Term Loan Prime plus2.75% 5/9/2027 75.3 75.3 71.8 0.03%^1872 Rosecrans, LLC dbaGoodbar Food Services andDrinking Places Term Loan Prime plus2.75% 5/9/2027 61.5 61.5 53.2 0.02%^Arclay, LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 5/5/2030 142.6 142.6 131.4 0.05%^Benchmark Building, Inc. Construction ofBuildings Term Loan Prime plus2.75% 5/5/2027 21.7 21.7 18.6 0.01%F-27See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Cable Management LLC Waste Managementand RemediationServices Term Loan Prime plus2.75% 5/3/2027 57.5 57.5 54.0 0.02%^Fine Arts Center of Easley, Inc.dba Midtown Music Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 5/2/2042 115.7 115.7 122.8 0.04%^Zahmel Restaurant SuppliersCorp dba Cash & Carry; ZahnersHardware MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 4/28/2027 85.0 85.0 74.0 0.03%^Love and Glory Learning Center,Inc. Social Assistance Term Loan Prime plus2.75% 4/28/2042 77.3 77.3 77.1 0.03%^Georgia Productions ServicesLLC Rental and LeasingServices Term Loan Prime plus2.75% 4/28/2027 87.4 87.4 80.3 0.03%^JMA Inc. dba Primecut andMezzo; Primecut at Marquee Food Services andDrinking Places Term Loan Prime plus2.75% 4/27/2042 220.4 220.4 233.8 0.08%Sneads Ferry Foods, Inc. dba DQGrill & Chill Food Services andDrinking Places Term Loan Prime plus2.75% 4/27/2042 617.7 617.7 614.8 0.22%^Asheville's Fun Depot, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/26/2027 83.9 83.9 85.4 0.03%^Carl Joseph Johnston dba VikingTransport TruckTransportation Term Loan Prime plus2.75% 4/26/2027 31.2 31.2 29.6 0.01%^Resident Research, LLC Other InformationServices Term Loan Prime plus2.75% 4/24/2027 84.6 84.6 72.6 0.03%^Getting Even LLC dba The ZooHealth Club Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/21/2027 7.2 7.2 6.4 —%^Ralph's Hair Salon, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 4/21/2042 49.5 49.5 50.6 0.02%^M.E. Interiors LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/20/2027 133.3 133.3 114.5 0.04%^MJ and M Home ImprovementsLLC DBA House Doctors Repair andMaintenance Term Loan Prime plus2.75% 4/20/2027 19.7 19.7 17.2 0.01%^Condron Brothers LLC DBA Luv2 Play Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/19/2027 114.6 114.6 103.5 0.04%^Affordable Auto Transport LLC TruckTransportation Term Loan Prime plus2.75% 4/17/2027 12.2 12.2 11.3 —%^Carpeteria (Markarian) Co. Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 4/13/2027 127.3 127.3 126.6 0.05%^Bloomer Machine & Fab, Inc andDale Stertz Properties Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 4/13/2042 203.6 203.6 210.9 0.08%F-28See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Butternuts Beer and Ale LLC Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 4/12/2027 70.7 70.7 71.9 0.03%^Citizens Lanes, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/31/2042 614.9 614.9 651.8 0.23%^The Altitude Group, LLC andCore Home Security, LLC Specialty TradeContractors Term Loan Prime plus2.75% 3/31/2027 47.7 47.7 40.9 0.01%^Golden Hen Inc. dba Cafe Food Services andDrinking Places Term Loan Prime plus2.75% 3/31/2027 61.8 61.8 53.7 0.02%^Shelter Harbor Inn, Inc. Accommodation Term Loan Prime plus2.75% 3/31/2042 205.8 205.8 218.2 0.08%^Landmark Ventures USA, Inc. Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 3/31/2027 178.8 178.8 153.4 0.06%^MIT LLC PublishingIndustries (exceptInternet) Term Loan Prime plus2.75% 3/31/2042 86.8 86.8 92.0 0.03%^Applied IntegratedTechnologies, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/31/2027 119.3 119.3 102.3 0.04%^Bear Trail Lodge LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/31/2042 548.0 548.0 574.2 0.21%^KWG Industries LLC dbaPeterson & Marsh MetalIndustries Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 3/30/2027 28.6 28.6 28.1 0.01%^Sea Smoke Barbeque, Corp andDanwen LLC Food Services andDrinking Places Term Loan Prime plus2.75% 3/30/2042 233.4 233.4 236.7 0.09%^Signature Rooms, Inc dbaGallery Furniture Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 3/30/2042 491.7 491.7 517.6 0.19%^Schafer Fisheries Inc. Food Manufacturing Term Loan Prime plus2.75% 3/30/2042 247.1 247.1 261.9 0.09%^Discount Price, LLC dbaRobert's Market Gasoline Stations Term Loan Prime plus2.75% 3/29/2042 204.6 204.6 209.3 0.08%^Douglas K. Soderblom . dbaLoma Linda Optometry Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/29/2027 95.4 95.4 86.2 0.03%^First Sail Group Inc. and OmenBoard Industires LLC Nonstore Retailers Term Loan Prime plus2.75% 3/29/2027 19.1 19.1 17.6 0.01%^Gauri Hospitality Group LLCdba Microtel Inns & Suites byWyndham Accommodation Term Loan Prime plus2.75% 3/29/2042 1,047.6 1,047.6 1,102.0 0.40%^H and H Hotshot Services, Inc.dba AA Hotshot & Logistics Couriers andMessengers Term Loan Prime plus2.75% 3/29/2030 94.5 94.5 82.0 0.03%F-29See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^American PharmaceuticalInnovation Company, LLC ChemicalManufacturing Term Loan Prime plus2.75% 3/28/2027 28.6 28.6 24.6 0.01%^Heil & Hornik LLC dba ElysiumTennis Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/27/2042 921.7 921.7 926.9 0.33%Pecos Entertainment LLC dbaState Theater and Pecos Inn LLC Motion Picture andSound RecordingIndustries Term Loan Prime plus2.75% 3/27/2042 410.9 410.9 435.5 0.16%^Ericon Inc. dba Quik Pik Gasoline Stations Term Loan Prime plus2.75% 3/24/2027 59.6 59.6 57.6 0.02%^Robert Dixon PA dba LawOffices of Robert Dixon Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/24/2042 422.8 422.8 445.2 0.16%^Denton Bio Fuels LLC andAmerican Bio Source LLC Waste Managementand RemediationServices Term Loan Prime plus2.75% 3/23/2027 56.5 56.5 51.6 0.02%^Color Graphic Press, Inc. Printing and RelatedSupport Activities Term Loan Prime plus2.75% 3/23/2027 114.4 114.4 116.4 0.04%JBK Truck Trailer and Bus Inc. Repair andMaintenance Term Loan Prime plus2.75% 3/23/2042 85.3 85.3 86.0 0.03%^Executive Fitness & NutritionInc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/23/2027 19.3 19.3 19.0 0.01%^Baton Rouge Cargo Services Inc.and 6507 Westport, LLC TruckTransportation Term Loan Prime plus2.75% 3/22/2042 637.8 637.8 659.9 0.24%^Vehicle Safety supply LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 3/21/2027 21.5 21.5 18.4 0.01%^J Sivilis LLC dba Pet Wants Personal andLaundry Services Term Loan Prime plus2.75% 3/17/2027 11.7 11.7 10.4 —%^The Purple Cow House ofPancake Inc Food Services andDrinking Places Term Loan Prime plus2.75% 3/16/2042 159.9 159.9 169.5 0.06%^Reservoir International LLC EducationalServices Term Loan Prime plus2.75% 3/16/2027 95.4 95.4 88.7 0.03%^Texcor, Inc.dba TexasCorral,Texas Coral Restaurants II,Inc. T.C. of Food Services andDrinking Places Term Loan Prime plus2.75% 3/16/2027 287.0 287.0 291.9 0.10%Alive Design, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/13/2027 22.0 22.0 18.8 0.01%^1MTX LLC and SunriseTransportation and Logistics, LLCand Mustafa M TruckTransportation Term Loan Prime plus2.75% 3/13/2027 671.0 671.0 575.5 0.21%^Dwayne Bernard Tate TruckTransportation Term Loan Prime plus2.75% 3/10/2027 10.0 10.0 9.2 —%^Elegant Occasions, LLC dba EProductions Personal andLaundry Services Term Loan Prime plus2.75% 3/10/2042 584.4 584.4 590.8 0.21%F-30See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Anthony LLC dba Star ofWoodward Market Food and BeverageStores Term Loan Prime plus2.75% 3/9/2042 114.2 114.2 121.1 0.04%^E & P Holdings 1 LLC andEvans & Paul Unlimited Corp. Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 3/9/2027 119.2 119.2 104.7 0.04%^Allegro Assisted Living Of Texas Nursing andResidential CareFacilities Term Loan Prime plus2.75% 3/6/2027 91.6 91.6 93.1 0.03%^Robbie E. Bakery and Cafe LLC Food and BeverageStores Term Loan Prime plus2.75% 3/3/2027 59.6 59.6 51.1 0.02%^Podium Auto Sales Inc and RRSProperty, LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 3/3/2042 90.0 90.0 90.3 0.03%^SSI Refrigerated Express Inc. andRobert M Stallone dba SSIExpress TruckTransportation Term Loan Prime plus2.75% 2/28/2027 223.2 223.2 191.4 0.07%^Weeping Willow Kennels, Incand Aileen N Black Personal andLaundry Services Term Loan Prime plus2.75% 2/28/2042 138.7 138.7 142.2 0.05%^Getting Even LLC dba The ZooHealth Club Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 2/28/2027 91.2 91.2 81.7 0.03%^Total Document Solutions Incand,TDS Services, LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 2/27/2030 301.5 301.5 278.2 0.10%^Teracore Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 2/27/2027 155.1 155.1 133.0 0.05%^John Finn Associates LLC,Greenslate LLC, Finn Technology,LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 2/27/2027 639.5 639.5 616.1 0.22%^McNally Enterprises Inc. Administrative andSupport Services Term Loan Prime plus2.75% 2/27/2027 61.6 61.6 55.1 0.02%^B & J Bicycle Shop Inc. Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 2/24/2027 14.2 14.2 14.5 0.01%^TMJ Pizza Mesa LLC dba Rosati'sPizza Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 2/24/2027 101.8 101.8 95.2 0.03%^3W Enterprises LLC Textile ProductMills Term Loan Prime plus2.75% 2/24/2042 80.9 80.9 81.9 0.03%^Victorian Restaurant and Tavern,LLC Food Services andDrinking Places Term Loan Prime plus2.75% 2/22/2042 106.4 106.4 105.3 0.04%^DER Services, LLC dba A.K.A.Sports Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 2/17/2042 39.7 39.7 42.0 0.02%^Bike Slug, LLC, Bike SlugHoldings Inc. and Seven RiversGroup ,LLC Repair andMaintenance Term Loan Prime plus2.75% 2/17/2027 18.5 18.5 15.8 0.01%^Ameritube, LLC and RavoneProperties, LLC Primary MetalManufacturing Term Loan Prime plus2.75% 2/14/2042 183.3 183.3 194.3 0.07%F-31See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^R&S Barnes Enterprises, Inc. dbaMassage Envy Spa Personal andLaundry Services Term Loan Prime plus2.75% 2/10/2027 88.8 88.8 77.2 0.03%^Baton Rouge Cargo Services Inc.and 2808 Court Street, LLC TruckTransportation Term Loan Prime plus2.75% 2/10/2042 245.1 245.1 253.7 0.09%^Sushiya Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 2/10/2027 17.8 17.8 15.8 0.01%^Select Propane & Fuel Inc. andSelect Fuel & Convenience LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 2/10/2030 1,208.1 1,208.1 1,114.5 0.40%^Maximo Canot dba Wash andDry Laundrymat Personal andLaundry Services Term Loan Prime plus2.75% 2/10/2042 136.3 136.3 141.5 0.05%^Marvic Enterprises Inc dbaJordan's Liquor Food and BeverageStores Term Loan Prime plus2.75% 2/10/2042 216.9 216.9 223.0 0.08%^Harrison Logging Company LLC Forestry andLogging Term Loan Prime plus2.75% 2/9/2027 100.7 100.7 91.5 0.03%^8 Minute Oil Change AutoRepair & Tire Center and JumirL.L.C. Repair andMaintenance Term Loan Prime plus2.75% 2/7/2042 324.7 324.7 321.8 0.12%^Christopher Borgia Food Services andDrinking Places Term Loan Prime plus2.75% 2/6/2027 12.2 12.2 10.7 —%^Splashlight LLC, SplashlightPhotographic & Digital StudiosLLC Management ofCompanies andEnterprises Term Loan Prime plus2.75% 2/2/2027 710.7 710.7 633.5 0.23%^DBMS Consulting, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 2/1/2042 183.2 183.2 181.7 0.07%^Brandco, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 1/31/2027 41.2 41.2 35.3 0.01%^Chidlren's House Learning, Incand Tarps Investment Group Social Assistance Term Loan Prime plus2.75% 1/31/2042 318.3 318.3 321.5 0.12%AP6 LLC and Amishp LLC Food Services andDrinking Places Term Loan Prime plus2.75% 1/30/2042 107.1 107.1 113.5 0.04%^Fave Realty, Inc. Real Estate Term Loan Prime plus2.75% 1/30/2042 53.9 53.9 55.1 0.02%^ZMKNY Tires Inc dba HoustonInternational Tires Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 1/27/2042 106.4 106.4 112.8 0.04%House of Bread & Coffee Corpdba Casa Do Pao Food Services andDrinking Places Term Loan Prime plus2.75% 1/27/2042 134.6 134.6 132.0 0.05%^SRC Publishing LLC Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 1/27/2027 21.2 21.2 18.2 0.01%F-32See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Return to Excellence Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 1/27/2027 16.7 16.7 17.0 0.01%^Sideways Sports Lounge andJonathan E. McGrew and PatriciaC. McGrew Food Services andDrinking Places Term Loan Prime plus2.75% 1/23/2027 17.0 17.0 14.5 0.01%^Fox Valley Rentals &Investments LLC and Brian MTomaszewski Food Services andDrinking Places Term Loan Prime plus2.75% 1/20/2042 42.0 42.0 42.2 0.02%^Rhone Wolf Vineyard LLC,Goldline Brands Inc. and MykaCellars, Inc. Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 1/19/2030 240.5 240.5 223.1 0.08%^Jolibe LLC and Jolibe AtelierLLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 1/18/2027 9.9 9.9 8.8 —%^Eickmann Management GroupLLC dba Jimmy Johns of Dundee Food Services andDrinking Places Term Loan Prime plus2.75% 1/17/2027 93.0 93.0 91.7 0.03%^Ramjay Inc. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 1/13/2027 412.2 412.2 375.7 0.13%^Fullbro Trust dba MenemshaBlues Miscellaneous StoreRetailers Term Loan Prime plus2.75% 1/13/2027 21.2 21.2 21.6 0.01%^Echelon Enterprises, Inc Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 1/10/2027 47.1 47.1 47.9 0.02%^Fort Smith Wings Inc. dba WingStop Food Services andDrinking Places Term Loan Prime plus2.75% 12/28/2026 18.2 18.2 16.4 0.01%^Sand Hill Associates, Ltd. dbaCharlie O's Tavern on the Point Food Services andDrinking Places Term Loan Prime plus2.75% 12/27/2041 417.1 417.1 415.6 0.15%^Joshua L. Baker Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 12/23/2026 14.7 14.7 12.6 —%^Jacliff Investments Inc. dbaInternational health Technologies PublishingIndustries (exceptInternet) Term Loan Prime plus2.75% 12/23/2026 116.9 116.9 100.1 0.04%^New Image Building Services,Inc.dba The Maids ServicingOakland Administrative andSupport Services Term Loan Prime plus2.75% 12/21/2026 40.9 40.9 36.5 0.01%^Chestnut Street Associates, LLCand Metropolitan Solutions, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/19/2041 271.4 271.4 263.1 0.09%^Means Enterprises LLC dbaFastFrame Frisco Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 12/16/2026 21.0 21.0 18.3 0.01%^Soon Im. Chin dba Stan C-Store Gasoline Stations Term Loan Prime plus2.75% 12/15/2041 209.7 209.7 218.7 0.08%^Sempco, Inc. MiscellaneousManufacturing Term Loan Prime plus2.75% 12/15/2041 41.5 41.5 43.9 0.02%^Allied Welding Inc. Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 12/15/2041 741.6 741.6 735.2 0.26%F-33See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Ericon, Inc. dba Quik Pik Gasoline Stations Term Loan Prime plus2.75% 12/15/2041 328.5 328.5 330.1 0.12%^White Hawk Inc. TruckTransportation Term Loan Prime plus2.75% 12/15/2026 1,028.4 1,028.4 881.1 0.32%^Elita 7, LLC Nursing andResidential CareFacilities Term Loan Prime plus2.75% 12/15/2041 703.2 703.2 722.6 0.26%^New Chicago Wholesale Bakery,Inc. FoodManufacturing Term Loan Prime plus2.75% 12/15/2041 446.9 446.9 445.0 0.16%^Techni-Pro Institute LLC EducationalServices Term Loan Prime plus2.75% 12/15/2026 177.6 177.6 157.1 0.06%^Trison Enterprises Inc.dba Lee'sAutomotive Repair andMaintenance Term Loan Prime plus2.75% 12/14/2041 402.2 402.2 409.8 0.15%^Cardinal Homes Inc. and Bret ABerneche Wood ProductManufacturing Term Loan Prime plus2.75% 12/14/2041 119.7 119.7 126.2 0.05%^HMG Strategy, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/14/2026 46.7 46.7 40.1 0.01%^D and E Hardware Co. and Dand E Pump Sales and Service Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 12/14/2041 521.7 521.7 523.0 0.19%^Cardinal Homes Inc,.AlouetteHoldings Inc. Wood ProductManufacturing Term Loan Prime plus2.75% 12/14/2026 996.8 996.8 1,010.8 0.36%^AGG Management Team LLCdba Chevron Gasoline Stations Term Loan Prime plus2.75% 12/14/2041 283.8 283.8 300.6 0.11%^Wayfarer Bicycle LLC Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 12/13/2041 91.3 91.3 89.6 0.03%^Success Advertising Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/13/2041 460.4 460.4 480.9 0.17%^Roast Beef Levittown LLC dbaArby's Food Services andDrinking Places Term Loan Prime plus2.75% 12/13/2026 439.4 439.4 446.5 0.16%^Queen Express LLC Gasoline Stations Term Loan Prime plus2.75% 12/13/2041 185.1 185.1 193.5 0.07%^Mack Team Enterprises Inc.dbaThe UPS Store #6815 Couriers andMessengers Term Loan Prime plus2.75% 12/9/2026 19.1 19.1 17.2 0.01%^Recycling Revolution,LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/9/2041 91.0 91.0 91.2 0.03%^Myndshft Technologies LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/9/2026 724.6 724.6 648.9 0.23%^New Life Hospital LLC Hospitals Term Loan Prime plus2.75% 12/8/2041 1,184.9 1,184.9 1,255.4 0.45%F-34See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Imagine By Carleen Inc. Personal andLaundry Services Term Loan Prime plus2.75% 12/8/2041 51.8 51.8 52.4 0.02%^Hanson's Greeks LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/8/2026 10.5 10.5 10.7 —%^Yachting Solutions LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 12/7/2029 68.1 68.1 64.7 0.02%^T and B Boots Inc dba Takken'sShoes Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 12/7/2026 95.2 95.2 89.5 0.03%^Lan Doctors, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/7/2026 222.5 222.5 219.7 0.08%^Lilo Holdings LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/5/2026 14.9 14.9 13.5 —%^The Lake Shore Hospitality Incdba Dowagiac Baymont Inn &Suites Accommodation Term Loan Prime plus2.75% 12/5/2041 348.5 348.5 362.4 0.13%^Ericon, Inc. Gasoline Stations Term Loan Prime plus2.75% 12/1/2041 717.9 717.9 725.3 0.26%^Noso Development LLC Construction ofBuildings Term Loan Prime plus2.75% 12/1/2026 70.1 70.1 60.1 0.02%^Quick Ship, LLC Couriers andMessengers Term Loan Prime plus2.75% 11/30/2026 9.7 9.7 8.4 —%^Pebble Wood Lane, LLC andGood Sam's Assisted LivingResidence, LLC Nursing andResidential CareFacilities Term Loan Prime plus2.75% 11/30/2041 66.6 66.6 70.5 0.03%^Sharaz Shah DBA ThomasJewelers Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 11/30/2026 7.5 7.5 6.4 —%^Choe Trading Group, Inc.dbaRapid Printers of Monterey Printing and RelatedSupport Activities Term Loan Prime plus2.75% 11/30/2026 20.9 20.9 20.7 0.01%^Studio Find It Georgia, Inc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 11/30/2026 7.0 7.0 6.1 —%^Imaginarium Foods LLC, Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2042 369.8 369.8 378.7 0.14%^RD Management, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/30/2026 198.5 198.5 172.3 0.06%^B4 Fitness LLC dba The ZooHealth Club Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 11/30/2026 20.9 20.9 18.7 0.01%^Usman Jalil, LLC dba Food Mart Gasoline Stations Term Loan Prime plus2.75% 11/29/2041 229.9 229.9 224.9 0.08%^Honor Mansion, Inc. Accommodation Term Loan Prime plus2.75% 11/29/2026 81.2 81.2 82.6 0.03%F-35See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Access Staffing, LLC Administrative andSupport Services Term Loan Prime plus2.75% 11/29/2026 1,044.6 1,044.6 895.0 0.32%^CRK Mens, LLC dba Spiff forMen Personal andLaundry Services Term Loan Prime plus2.75% 11/23/2026 99.2 99.2 86.8 0.03%^WPN Recycling Company LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 11/23/2026 20.9 20.9 21.2 0.01%^Hafa Adai Signs and GraphicsLLC dba Fastsigns of Auburn -#281901 Administrative andSupport Services Term Loan Prime plus2.75% 11/23/2026 55.7 55.7 48.4 0.02%^Merchant Coterie, Inc. MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 11/23/2026 116.1 116.1 99.4 0.04%^6E Technologies LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/22/2026 159.9 159.9 148.2 0.05%^Rognes Corp dba RTS Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 11/22/2026 360.0 360.0 331.0 0.12%^Bouquet Restaurant LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/22/2041 123.2 123.2 125.2 0.04%^J.B.K Truck Trailer and Bus Inc Repair andMaintenance Term Loan Prime plus2.75% 11/22/2041 428.7 428.7 430.9 0.15%^Broms Asset Management LLC Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 11/22/2026 116.1 116.1 99.4 0.04%^Skaggs RV Outlet LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 11/21/2026 92.9 92.9 94.4 0.03%^Catherine Christine Morin dbaPurr-Fect Pets Personal andLaundry Services Term Loan Prime plus2.75% 11/17/2026 17.4 17.4 14.9 0.01%^Stratmar Systems Inc dbaStratmar Retail Services Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/16/2026 63.6 63.6 64.6 0.02%^Hoosier Health Plus, LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/15/2026 116.1 116.1 109.9 0.04%^J. A. Kohlhepp Sons, Inc. dbaKohlhepp's True Value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/10/2041 439.5 439.5 453.7 0.16%^Hackensack Steel Corporationand Luzerne Ironworks Inc Specialty TradeContractors Term Loan Prime plus2.75% 11/10/2026 224.7 224.7 228.4 0.08%^Panther Ironworks and RiggingSolutions LLC Specialty TradeContractors Term Loan Prime plus2.75% 11/10/2026 140.4 140.4 129.5 0.05%F-36See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^J. A. Kohlhepp Sons, Inc. dbaKohlhepp's True Value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/10/2026 175.3 175.3 174.7 0.06%^MIK LLC dba Firehouse Subs Food Services andDrinking Places Term Loan Prime plus2.75% 11/9/2026 189.3 189.3 164.5 0.06%^Rich's Food Stores LLC dba Hwy55 of Wallace Food Services andDrinking Places Term Loan Prime plus2.75% 11/9/2026 40.6 40.6 38.1 0.01%^Bovill Creative,LLC Real Estate Term Loan Prime plus2.75% 11/9/2041 277.0 277.0 293.5 0.11%^Dyer Properties, LLC andBayview Pharmacy, Inc. Health and PersonalCare Stores Term Loan Prime plus2.75% 11/9/2041 237.0 237.0 236.0 0.08%^Big Apple Entertainment PartnersLLC Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 11/9/2026 162.5 162.5 139.2 0.05%^Surgarloaf Concepts LLC dba FatBiscuit Food Services andDrinking Places Term Loan Prime plus2.75% 11/8/2026 162.1 162.1 164.7 0.06%^Fine Line Interiors, Inc. Repair andMaintenance Term Loan Prime plus2.75% 11/4/2041 80.6 80.6 85.4 0.03%^131 Miles LLC and Ohm ShubhLaxmi, LLC. dba Mr Hero Food Services andDrinking Places Term Loan Prime plus2.75% 11/3/2041 124.6 124.6 128.4 0.05%^Veracruz Shabo, LLC, WaterfallsQuick Lube LLC Repair andMaintenance Term Loan Prime plus2.75% 11/1/2041 117.9 117.9 121.3 0.04%^Glocecol LLC Administrative andSupport Services Term Loan Prime plus2.75% 11/1/2026 69.6 69.6 70.7 0.03%^Moolchan Enterprises LLC dbaStaying Green Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 10/31/2026 16.7 16.7 15.9 0.01%^Bloomquist Communications Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 10/31/2026 55.3 55.3 47.4 0.02%^Middlesex Auto Sales Corp Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 10/31/2041 123.1 123.1 127.0 0.05%^Woodstock Enterprises Corp dbaTrue Scent Candle Co MiscellaneousManufacturing Term Loan Prime plus2.75% 10/31/2041 87.5 87.5 85.9 0.03%^FibAire Communications, LLC Telecommunications Term Loan Prime plus2.75% 10/27/2026 99.7 99.7 92.1 0.03%^Elite Structures Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 10/27/2029 215.7 215.7 211.5 0.08%^Bonita Stone LLC and CastoneCreations Inc Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 10/25/2041 260.2 260.2 261.2 0.09%^Empire Processor Services Inc.and Verrazano Wholesale Dist.,Inc. Nonstore Retailers Term Loan Prime plus2.75% 10/25/2026 121.0 121.0 123.0 0.04%F-37See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Blakeslee Arpaia Chapman Incand Chapman ConstructionServices LLC Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 10/24/2026 391.9 391.9 393.8 0.14%^Eco Vehicle Systems LLC TransportationEquipmentManufacturing Term Loan Prime plus2.75% 10/21/2026 881.5 881.5 889.6 0.32%^Worldwide Estate, Inc. dbaWashington Heights Manor Nursing andResidential CareFacilities Term Loan Prime plus2.75% 10/21/2041 221.1 221.1 234.3 0.08%^Gold Wind Logistics LLC TruckTransportation Term Loan Prime plus2.75% 10/20/2041 173.3 173.3 183.6 0.07%^Speaker City, Inc. dba RollinThunder Electronics andAppliance Stores Term Loan Prime plus2.75% 10/14/2041 123.1 123.1 126.4 0.05%^Maine Service Corp MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 10/13/2026 190.4 190.4 179.6 0.06%^Justin Partlow Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 10/13/2026 18.0 18.0 15.4 0.01%^Reliable Recovery Services LLC Support Activitiesfor Transportation Term Loan Prime plus2.75% 10/7/2026 103.7 103.7 95.0 0.03%^Ailky Corporation Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 10/3/2026 230.5 230.5 203.1 0.07%^Wyspen Corporation dbaCharlestown Ace Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 10/3/2026 33.2 33.2 28.4 0.01%^MegaPhase, LLC Computer andElectronic ProductManufacturing Term Loan Prime plus2.75% 9/30/2026 137.1 137.1 133.3 0.05%^Seaway LLC and Reklaw LLCdba Allure Lounge Food Services andDrinking Places Term Loan Prime plus2.75% 9/30/2041 134.8 134.8 142.8 0.05%^JJA Transportation ManagementInc. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/30/2026 48.0 48.0 41.1 0.01%^Adelwerth Bus Corp. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/30/2041 238.3 238.3 238.1 0.09%^Adelwerth Bus Corporation,Transportation Leasing Corp. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/30/2029 615.8 615.8 597.2 0.21%^Vision Automotive LLC dbaVision Chrysler Jeep Dodge Ramof Defiance Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 9/29/2029 631.7 631.7 595.7 0.21%^Thunderdome Racing Inc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/29/2026 17.4 17.4 17.4 0.01%^Graphics,Type and ColorEnterprises Inc dbaClubflyers.com and GTC Med Printing and RelatedSupport Activities Term Loan Prime plus2.75% 9/28/2041 833.4 833.4 882.5 0.32%F-38See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Beadon Inc Food and BeverageStores Term Loan Prime plus2.75% 9/28/2026 20.6 20.6 20.7 0.01%^CNC Precision Machine, Inc. Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/28/2041 1,235.9 1,235.9 1,246.2 0.45%^CD Game Exchange Inc. MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/28/2026 20.6 20.6 17.6 0.01%^Kyle M Walker DDS, PC Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/27/2026 204.7 204.7 180.9 0.06%^Reynolds Fence & Guardrail Inc. Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 9/27/2026 575.4 575.4 552.7 0.20%^Luv 2 Play Nor Cal, LLC dba Luv2 Play Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/27/2026 48.0 48.0 43.1 0.02%^Luna Nueva LLC dba BioBuilders Specialty TradeContractors Term Loan Prime plus2.75% 9/27/2026 13.7 13.7 12.1 —%^Sarah S Olelewe MD Inc Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/26/2041 287.3 287.3 290.7 0.10%^TPFC,LLC dbaThe Picture FrameCompany Miscellaneous StoreRetailers Term Loan Prime plus2.75% 9/26/2041 57.6 57.6 58.4 0.02%^Ridge Road Equestrian LLC dbaRicochet Ridge Ranch Support Activitiesfor Agriculture andForestry Term Loan Prime plus2.75% 9/26/2026 8.2 8.2 8.2 —%^PeopleBest Inc. Administrative andSupport Services Term Loan Prime plus2.75% 9/26/2026 13.7 13.7 11.7 —%^Mr. Mulch, Inc Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 9/23/2041 397.8 397.8 377.1 0.14%^B4 Fitness LLC dba The ZooHealth Club Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/23/2026 80.0 80.0 71.6 0.03%^InformationTelevision NetworkInc Motion Picture andSound RecordingIndustries Term Loan Prime plus2.75% 9/22/2041 823.0 823.0 862.9 0.31%^GRA Financial Services Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/22/2026 11.0 11.0 9.4 —%^Cuppiecakes LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/21/2041 22.1 22.1 22.3 0.01%^Wrecking Crew Media LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 9/21/2026 45.7 45.7 39.1 0.01%^Benoit's Towing and RecoveryLLC Support Activitiesfor Transportation Term Loan Prime plus2.75% 9/20/2026 11.0 11.0 9.5 —%F-39See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Consulting Solutions Inc. andMark Luciani Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/20/2026 20.6 20.6 19.5 0.01%^Brittany Burns LLC dba DreamsCome True Personal andLaundry Services Term Loan Prime plus2.75% 9/19/2026 12.0 12.0 12.2 —%^Eyncon LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/16/2041 49.0 49.0 50.1 0.02%^The Merrin Group LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/15/2026 159.9 159.9 154.8 0.06%^Rich's Food Stores LLC dba Hwy55 of Wallace Food Services andDrinking Places Term Loan Prime plus2.75% 9/14/2026 133.1 133.1 124.9 0.04%^Atlantic Alarm Systems andServices LLC Administrative andSupport Services Term Loan Prime plus2.75% 9/14/2026 14.1 14.1 12.5 —%^Metropet Dog Center, Inc Personal andLaundry Services Term Loan Prime plus2.75% 9/13/2041 107.1 107.1 109.8 0.04%^Marquis Cattle Company Animal Productionand Aquaculture Term Loan Prime plus2.75% 9/13/2026 46.1 46.1 46.9 0.02%^Bingham Enterprises, Inc andFull Belli Deli and SausageCompany Food Services andDrinking Places Term Loan Prime plus2.75% 9/12/2041 80.9 80.9 79.9 0.03%^Artisan Infrastructure Holdings,LLC Data Processing,Hosting, and RelatedServices Term Loan Prime plus2.75% 9/7/2026 114.2 114.2 97.8 0.04%^SRA Mechanicial Inc Specialty TradeContractors Term Loan Prime plus2.75% 9/6/2041 42.9 42.9 45.3 0.02%^Sandia Enterprises Inc dbaMassage Envy Spa Personal andLaundry Services Term Loan Prime plus2.75% 9/6/2026 57.1 57.1 48.9 0.02%^Animal Intrusion PreventionSystems Holding Company, LLC Administrative andSupport Services Term Loan Prime plus2.75% 8/30/2026 113.8 113.8 100.1 0.04%^Suncrest Stone Products LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 8/29/2026 543.4 543.4 489.2 0.18%^Suncrest Stone Products LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 8/29/2041 638.7 638.7 601.1 0.22%^Clark Realty LLC Real Estate Term Loan Prime plus2.75% 8/29/2041 232.5 232.5 225.9 0.08%^Raem Corporation dba DrycleanExpress Personal andLaundry Services Term Loan Prime plus2.75% 8/29/2041 71.0 71.0 74.3 0.03%^Warren Dale Warrington dbaCustom Paint and Body Repair andMaintenance Term Loan Prime plus2.75% 8/26/2041 99.1 99.1 102.2 0.04%^TAGR Inc dba Miami Grill137and John Nakis Food Services andDrinking Places Term Loan Prime plus2.75% 8/26/2026 96.9 96.9 85.3 0.03%^Albert Basse Associates Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 8/25/2026 56.7 56.7 57.6 0.02%F-40See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Avery Management Inc. dbaWhetstone Upholstery Repair andMaintenance Term Loan Prime plus2.75% 8/25/2026 9.7 9.7 8.3 —%^Dean Technology Inc ElectricalEquipment,Appliance, andComponentManufacturing Term Loan Prime plus2.75% 8/25/2041 379.0 379.0 398.7 0.14%^Rosmel Pools Inc Repair andMaintenance Term Loan Prime plus2.75% 8/25/2026 20.4 20.4 17.9 0.01%^Tabadesa Associates Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/25/2026 20.4 20.4 17.5 0.01%^TR Companies LLC dba TrueValue Rental and Liberty Rental 4U Rental and LeasingServices Term Loan Prime plus2.75% 8/25/2026 81.7 81.7 69.9 0.03%^Sambella Holdings, LLC andStrike Zone Entertainment CenterLLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/24/2041 492.0 492.0 517.3 0.19%^Luv 2 Play Temecula, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 8/15/2026 54.4 54.4 46.6 0.02%^Bear Creek Entertainment LLCdba The Woods at Bear Creek Accommodation Term Loan Prime plus2.75% 8/12/2041 402.0 402.0 400.8 0.14%^2 Cool Beans LLC dbaMenchies's Frozen Yogurt Food Services andDrinking Places Term Loan Prime plus2.75% 8/11/2026 74.9 74.9 64.1 0.02%^Grayson O Company MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 8/10/2041 611.9 611.9 643.6 0.23%^Charal Investments LLC dbaOrange Theory Fitness Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 8/10/2026 79.4 79.4 68.0 0.02%^Paul Belanger dba Paul BelangerLandscaping Administrative andSupport Services Term Loan Prime plus2.75% 8/9/2026 13.6 13.6 11.6 —%^Nicolette Reiser dba Comfort &Balance Personal andLaundry Services Term Loan Prime plus2.75% 7/29/2041 73.3 73.3 75.5 0.03%^The Hungry Rhino LLC Real Estate Term Loan Prime plus2.75% 7/29/2041 74.5 74.5 75.3 0.03%^USA General Investment LLCdba Braniff Paint and Body Shop Repair andMaintenance Term Loan Prime plus2.75% 7/29/2026 20.3 20.3 18.0 0.01%^303 Tower Drive LLC Repair andMaintenance Term Loan Prime plus2.75% 7/29/2041 391.2 391.2 405.7 0.15%^Little Tree Huggers Child CareLLC Social Assistance Term Loan Prime plus2.75% 7/29/2041 136.8 136.8 144.8 0.05%^Big Apple Entertainment PartnersLLC dba Ripley's Believe It or Not Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 7/28/2026 270.3 270.3 231.3 0.08%^676 Club LP dba The GreenDoor Tavern/The Drifter Food Services andDrinking Places Term Loan Prime plus2.75% 7/28/2041 654.9 654.9 685.0 0.25%F-41See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^KJCKD Inc dba Camelot Print &Copy Centers/Copy A Second Administrative andSupport Services Term Loan Prime plus2.75% 7/28/2041 573.8 573.8 581.8 0.21%^MacIver Corporation dbaDivision Camera Rental and LeasingServices Term Loan Prime plus2.75% 7/28/2026 1,133.9 1,133.9 1,077.0 0.39%^Apple Tree NC Inc dba WilliamsFarm & Garden Center Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 7/28/2041 329.4 329.4 329.3 0.12%^Intrepid Trinity LLC Nonstore Retailers Term Loan Prime plus2.75% 7/28/2041 61.1 61.1 62.7 0.02%^Kidtastic LLC dba The LittleGym of Audubon Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 7/27/2026 51.1 51.1 43.7 0.02%^GF Libations Inc dba MinutemanPress Printing and RelatedSupport Activities Term Loan Prime plus2.75% 7/27/2041 38.6 38.6 34.8 0.01%^EPEC Juice LLC dba Jamba Juice Food Services andDrinking Places Term Loan Prime plus2.75% 7/27/2026 75.2 75.2 64.4 0.02%^Pinco Pizza LLC dba Jet's Pizza Food Services andDrinking Places Term Loan Prime plus2.75% 7/27/2026 66.6 66.6 66.3 0.02%^JAG Unit 1, LLC dba Arooga'sGrille House and Sports Bar Food Services andDrinking Places Term Loan Prime plus2.75% 7/27/2026 112.6 112.6 96.4 0.03%^Peckett's Inc Crop Production Term Loan Prime plus2.75% 7/27/2041 219.6 219.6 232.5 0.08%^The Grasso Companies, LLC andGrasso Pavement Maintenance,LLC Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 7/26/2026 81.9 81.9 75.3 0.03%^My Sainath Inc dba Motel 6 Accommodation Term Loan Prime plus2.75% 7/22/2041 298.5 298.5 310.3 0.11%^Robert G Larson State FarmInsurance Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 7/22/2026 20.3 20.3 17.3 0.01%^J and D Resources LLC dbaAqua Science Specialty TradeContractors Term Loan Prime plus2.75% 7/19/2026 117.6 117.6 101.8 0.04%^Robert P Daniels dba Ginger andFriend's Peppermint Village GiftShop Miscellaneous StoreRetailers Term Loan Prime plus2.75% 7/18/2026 14.2 14.2 12.1 —%^Franklin Firm LLC dba Luv 2Play Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 7/15/2041 169.9 169.9 172.5 0.06%^Billingsworks LLC dba SpoonShine Cafe Food Services andDrinking Places Term Loan Prime plus2.75% 7/15/2026 8.7 8.7 8.8 —%^Takeuchi Commercial CleaningServices, LLC dba We Clean SanDiego Administrative andSupport Services Term Loan Prime plus2.75% 7/13/2026 41.7 41.7 35.7 0.01%^Jacob Rugs LLC dba Rugs Outlet Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 7/13/2026 59.1 59.1 60.0 0.02%F-42See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^RM Hawkins LLC dba PureWater Tech West Nonstore Retailers Term Loan Prime plus2.75% 7/7/2026 45.1 45.1 43.5 0.02%^Dino Smiles Children's CosmeticDentistry Ambulatory HealthCare Services Term Loan Prime plus2.75% 7/7/2026 12.8 12.8 11.3 —%^Nevey's LLC dba Stark Food III Food and BeverageStores Term Loan Prime plus2.75% 6/30/2041 287.9 287.9 304.5 0.11%^Soregard Inc Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 6/30/2041 272.0 272.0 272.3 0.10%^Martin Inventory ManagementLLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 6/30/2026 94.6 94.6 96.6 0.03%^P L H Pharmaco Inc dbaFarmacia San Jose Health and PersonalCare Stores Term Loan Prime plus2.75% 6/30/2026 155.7 155.7 157.2 0.06%^Hartford Cardiology Group LLCand Ideal Nutrition of ConnecticutLLC Ambulatory HealthCare Services Term Loan 6.25% 6/30/2026 474.6 474.6 432.7 0.16%^Desert Tacos LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2026 90.7 90.7 88.1 0.03%^VMA Technologies LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/30/2026 20.2 20.2 18.2 0.01%^Corning Lumber Company Incand Frank R Close and Son Inc Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 6/30/2029 181.2 181.2 187.1 0.07%^Castone Creations Inc Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 6/29/2026 78.2 78.2 72.9 0.03%^WGI, LLC dba Williams GrantInn Accommodation Term Loan Prime plus2.75% 6/29/2041 128.1 128.1 132.8 0.05%^Ninsa LLC Specialty TradeContractors Term Loan Prime plus2.75% 6/29/2041 109.8 109.8 117.4 0.04%^KWG Industries, LLC dbaPeterson & Marsh Metal Industries Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 6/29/2041 297.7 297.7 312.2 0.11%^O.D.S. Inc dba Four SeasonsHealth & Racquet and Step 'N'Motion, Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/29/2026 125.2 125.2 115.2 0.04%^E & P Holdings 1 LLC andEvans & Paul LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 6/28/2026 111.9 111.9 103.5 0.04%^MaidPro Marin dba MaidPro Administrative andSupport Services Term Loan Prime plus2.75% 6/28/2026 15.7 15.7 14.1 0.01%^Edge Pest Control LLC Administrative andSupport Services Term Loan Prime plus2.75% 6/27/2026 670.7 670.7 604.2 0.22%^All Printing Solutions, Inc. dbaPryntcomm Printing and RelatedSupport Activities Term Loan Prime plus2.75% 6/27/2041 533.1 533.1 536.5 0.19%F-43See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Jumbomarkets Inc dba RinesJumbomarkets Food and BeverageStores Term Loan Prime plus2.75% 6/24/2026 44.7 44.7 40.3 0.01%^El Basha Inc dba RPM West SanFernando Valley Real Estate Term Loan Prime plus2.75% 6/24/2026 16.7 16.7 15.1 0.01%^Island Time Investments, LLCdba Swantown Inn Bed &Breakfast Accommodation Term Loan Prime plus2.75% 6/24/2041 98.8 98.8 105.7 0.04%^Yellow Cab Company ofKissimmee Inc Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 6/24/2041 55.5 55.5 55.6 0.02%^Shooting Sports Academy LLCand Jetaa LLC dba ShootingSports Academy Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/23/2041 486.3 486.3 494.3 0.18%^Long Island Comedy LLC dbaGovernors and New YorkComedy, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/23/2041 183.0 183.0 190.1 0.07%^Visual Advantage LLC dba SignsNow Perryberg Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/23/2041 89.1 89.1 91.7 0.03%^SNS of Central Alabama, LLCdba Steak N Shake Food Services andDrinking Places Term Loan Prime plus2.75% 6/21/2026 51.4 51.4 48.7 0.02%^Evergreen Investment &Property Management LLC,Universal Kidney Center Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/20/2041 1,223.2 1,223.2 1,292.8 0.46%^Italian Heritage Tile and StoneInc Specialty TradeContractors Term Loan Prime plus2.75% 6/20/2026 55.9 55.9 50.3 0.02%^Bagelicious, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/17/2026 48.8 48.8 44.2 0.02%^T and B Boots Inc dba Takken'sShoes Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 6/17/2026 204.5 204.5 208.9 0.08%^NKJ Lusby Donuts LLC Food and BeverageStores Term Loan Prime plus2.75% 6/16/2026 20.1 20.1 18.1 0.01%^Winegirl Wines LLC Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 6/16/2026 10.1 10.1 10.3 —%^Blue Eagle Transport Inc,Greeneagle Transport Inc andGolden Eagle Transport Couriers andMessengers Term Loan Prime plus2.75% 6/16/2026 506.1 506.1 455.9 0.16%^Jai-Alexia Consulting, Inc. Couriers andMessengers Term Loan Prime plus2.75% 6/15/2026 10.6 10.6 9.5 —%^Pumpkin Patch Child Care ofSouthington, LLC and GiuseppePugliares Social Assistance Term Loan Prime plus 2% 6/15/2041 501.5 501.5 497.8 0.18%^Strag Industries LLC dbaMeineke Car Care Center 841 Repair andMaintenance Term Loan Prime plus2.75% 6/15/2026 13.4 13.4 12.9 —%^Luv 2 Play AZ LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/10/2026 55.9 55.9 55.9 0.02%F-44See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Refoleen Inc dba Spice and TeaExchange Food and BeverageStores Term Loan Prime plus2.75% 6/10/2026 77.4 77.4 69.8 0.03%^VBGB Uptown, LLC dba VBGBBeer Hall & Garden Food Services andDrinking Places Term Loan Prime plus2.75% 6/8/2026 75.1 75.1 67.7 0.02%^ScimTech Industries Inc dbaArcher Aerospace Computer andElectronic ProductManufacturing Term Loan Prime plus2.75% 6/6/2026 10.7 10.7 9.7 —%^Larry H. Patterson and RainbowMovers, Inc TruckTransportation Term Loan Prime plus2.75% 6/6/2026 20.1 20.1 18.2 0.01%^Solvit Inc and Solvit North Inc Specialty TradeContractors Term Loan Prime plus2.75% 6/3/2026 226.2 226.2 211.8 0.08%^AP5 LLC dba Krauser's FoodStore Food and BeverageStores Term Loan Prime plus2.75% 6/2/2041 236.8 236.8 246.4 0.09%^ATI Jet Inc Air Transportation Term Loan Prime plus2.75% 5/31/2026 460.4 460.4 430.3 0.15%^Farmer Boy Diner Inc dbaFarmer Boy Diner & Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 5/31/2026 44.4 44.4 45.3 0.02%^Angelo Faia dba AVFConstruction Construction ofBuildings Term Loan Prime plus2.75% 5/27/2041 97.1 97.1 100.5 0.04%^Premier Athletic Center of Ohio,Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 5/27/2026 77.7 77.7 79.3 0.03%^Jack Frost Firewood Inc. andDavid Dubinsky Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 5/26/2041 201.0 201.0 207.0 0.07%^Mersada Holdings LLC Nonstore Retailers Term Loan Prime plus2.75% 5/26/2026 299.6 299.6 305.9 0.11%^Southwest Division Inc Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 5/26/2026 7.3 7.3 6.9 —%^PennyLion LLC dba Creamistry Food Services andDrinking Places Term Loan Prime plus2.75% 5/25/2026 72.8 72.8 67.1 0.02%^International Kitchen SupplyLLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 5/25/2026 165.8 165.8 155.9 0.06%^Groth Lumber Co. Inc. dba TrueValue Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 5/25/2026 20.0 20.0 20.4 0.01%^Powerspec Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 5/24/2026 77.7 77.7 70.0 0.03%^Island Life Graphics Inc dbaFASTSIGNS #576 MiscellaneousManufacturing Term Loan Prime plus2.75% 5/24/2026 20.0 20.0 18.2 0.01%^Horseshoe Barbecue, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 5/23/2029 12.4 12.4 12.8 —%F-45See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Elderfriend Inc dba GrannyNannies dba GN Live Scan Social Assistance Term Loan Prime plus2.75% 5/20/2026 11.3 11.3 10.2 —%^National Air Cargo Holdings Inc Air Transportation Term Loan Prime plus2.75% 5/20/2026 1,109.5 1,109.5 1,118.9 0.40%^Pro Auto Repair LLC Repair andMaintenance Term Loan Prime plus2.75% 5/20/2026 6.6 6.6 6.6 —%^HBA LLC dba Palmetto Twist-Vista Repair andMaintenance Term Loan Prime plus2.75% 5/18/2026 17.2 17.2 15.9 0.01%^J&A Laundromat Inc. Personal andLaundry Services Term Loan Prime plus2.75% 5/18/2026 59.9 59.9 55.1 0.02%^Dedicated Incorporated Administrative andSupport Services Term Loan Prime plus2.75% 5/18/2041 45.3 45.3 47.3 0.02%^J Harris Trucking, LLC TruckTransportation Term Loan Prime plus2.75% 5/13/2026 38.3 38.3 36.3 0.01%^FJN Catering Inc Food Services andDrinking Places Term Loan Prime plus2.75% 5/13/2041 256.2 256.2 272.6 0.10%^LED Lighting Enterprises LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 5/13/2026 20.0 20.0 18.4 0.01%^Studio Find It Georgia Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 5/13/2026 20.0 20.0 18.5 0.01%^Pumpkin Patch Inc and ChristineFeliciano and Antonio Feliciano Social Assistance Term Loan Prime plus2.75% 5/12/2041 129.1 129.1 133.4 0.05%^The Delon Group LLC dba ILove Juice Bar Food Services andDrinking Places Term Loan Prime plus2.75% 5/12/2026 19.3 19.3 17.4 0.01%^Sabir Inc. dba Bear Diner Food Services andDrinking Places Term Loan Prime plus2.75% 5/11/2041 120.8 120.8 127.3 0.05%^Gator D'Lites LLC dba D'LitesEmporium Food and BeverageStores Term Loan Prime plus2.75% 5/5/2026 20.0 20.0 18.0 0.01%^Warner Home Comfort, LLC dbaSmith Piping Specialty TradeContractors Term Loan Prime plus2.75% 4/29/2041 80.3 80.3 83.0 0.03%^Keller, Fishback & Jackson LLP Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/29/2026 115.0 115.0 117.5 0.04%^Marc S. Rosenberg P.C. dbaMammuth and Rosenberg Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/29/2026 19.8 19.8 17.9 0.01%^Euro Car Miami LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 4/29/2026 55.1 55.1 56.2 0.02%^Hard Exercise Works WinterPark LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/29/2026 35.9 35.9 32.3 0.01%F-46See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^La Nopalera Mexicano 2, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 4/29/2026 79.5 79.5 81.2 0.03%^Loriet LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 4/29/2026 6.6 6.6 6.0 —%^May-Craft Fiberglass Products Inc TransportationEquipmentManufacturing Term Loan Prime plus2.75% 4/29/2041 240.8 240.8 257.5 0.09%^Alpha Omega Trucking LLC TruckTransportation Term Loan Prime plus2.75% 4/29/2041 171.0 171.0 182.9 0.07%^Scoler LLC dba Gold's Gym Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/29/2026 231.2 231.2 216.3 0.08%^Empowerschool LLC andEmpower Autism Academy, LLC Social Assistance Term Loan Prime plus2.75% 4/29/2041 147.8 147.8 158.0 0.06%^Inner Beauty Salon and SuiteLLC Personal andLaundry Services Term Loan Prime plus2.75% 4/28/2041 63.2 63.2 67.2 0.02%^Atlantic Restaurant AssociatesLLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/28/2041 255.4 255.4 269.4 0.10%^Costume World Inc Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 4/28/2041 1,219.4 1,219.4 1,304.0 0.47%^Pecos Inn LLC dba Econo Lodge Accommodation Term Loan Prime plus2.75% 4/28/2041 657.0 657.0 692.9 0.25%^Shepherd Appraisal Services LLCdba Property Damage Appraisersof Oklahoma Real Estate Term Loan Prime plus2.75% 4/28/2026 7.9 7.9 7.1 —%^Knowledge First Inc dba MagicYears of Learning Social Assistance Term Loan Prime plus2.75% 4/27/2026 70.6 70.6 69.1 0.02%^Green Country FilterManufacturing LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 4/27/2026 75.4 75.4 69.4 0.02%^Accent Comfort Services, LLC Specialty TradeContractors Term Loan Prime plus2.75% 4/26/2026 79.3 79.3 71.4 0.03%^Homecare Casa Rhoda 123 Inc Ambulatory HealthCare Services Term Loan Prime plus 2% 4/26/2041 654.6 654.6 656.7 0.24%^Automotive Core Recycling, LLCand 828 Old Colony Road, LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 4/22/2041 243.2 243.2 244.5 0.09%^McIntosh Trail ManagementServices Organization Inc Ambulatory HealthCare Services Term Loan Prime plus2.75% 4/22/2041 414.1 414.1 442.8 0.16%^Jande Graphics LLC dbaFastSigns #103201 Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/21/2026 49.3 49.3 44.4 0.02%^AAA Mill Direct, Inc. dba CarpetMill Outlets Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 4/21/2026 6.9 6.9 7.1 —%F-47See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Miguel Fernando Borda, P.A. dbaBGR Dental Ambulatory HealthCare Services Term Loan Prime plus2.75% 4/15/2026 19.8 19.8 18.3 0.01%^Sushiya Inc Food Services andDrinking Places Term Loan Prime plus2.75% 4/12/2026 77.1 77.1 71.7 0.03%^Sierra Foothill Cremation &Funeral Service, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 4/7/2026 46.7 46.7 42.1 0.02%^Waterfalls Quick Lube LLC andVeracruz Shabo LLC Repair andMaintenance Term Loan Prime plus2.75% 4/6/2041 268.2 268.2 281.0 0.10%^KNS Early Learning AcademyLLC Social Assistance Term Loan Prime plus2.75% 4/6/2041 49.7 49.7 51.1 0.02%^Vehicle Safety Supply LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 3/31/2026 19.7 19.7 17.7 0.01%^Men of Steel Enterprises LLC andVogelbacher Properties LLC Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 3/31/2041 382.2 382.2 379.9 0.14%^Gill Express Inc and Blue SpeedLLC Repair andMaintenance Term Loan Prime plus2.75% 3/31/2041 503.2 503.2 521.2 0.19%^Dana A. Farley dba IndependentCabinets Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 3/31/2041 65.6 65.6 70.1 0.03%^Christian Soderquist dbaSoderquist Plumbing and HeatingLLC Specialty TradeContractors Term Loan Prime plus2.75% 3/31/2041 55.1 55.1 58.9 0.02%^Duke's Cleaners Inc Personal andLaundry Services Term Loan Prime plus2.75% 3/31/2026 41.1 41.1 39.5 0.01%^Farhad Brothers LLC dba Lulu'sPizzeria & Family Restaurant andMarvin Food Services andDrinking Places Term Loan Prime plus2.75% 3/31/2026 54.8 54.8 49.3 0.02%^Cameo Carter, MD A ProfessionalCorporation dba The GardenPediatric Group Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/31/2026 65.6 65.6 59.0 0.02%^Gordon Rogers and Heidi Rogersdba Stone House Motor Inn Accommodation Term Loan Prime plus2.75% 3/30/2026 19.9 19.9 20.3 0.01%^NOSO Development, LLC Construction ofBuildings Term Loan Prime plus2.75% 3/30/2026 163.9 163.9 147.5 0.05%^Wyldewood Cellars, Inc. Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 3/30/2041 969.9 969.9 977.8 0.35%^Tom Sawyer Country RestaurantLLC and AM 3208 LLC Food Services andDrinking Places Term Loan Prime plus2.75% 3/30/2041 250.5 250.5 264.9 0.10%^MTS Car Service LLC Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 3/30/2026 9.2 9.2 8.3 —%^Beale Street Blues Company-WestPalm Beach, LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 3/30/2026 82.0 82.0 75.4 0.03%^Barrocas Gym LLC dba SnapFitness Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/29/2026 17.4 17.4 16.6 0.01%F-48See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Vinmar Inc. dba LocandaPortofino Food Services andDrinking Places Term Loan Prime plus2.75% 3/29/2026 71.0 71.0 63.9 0.02%^Lust for Life Footwear, LLC Leather and AlliedProductManufacturing Term Loan Prime plus2.75% 3/29/2026 327.8 327.8 295.0 0.11%^Atlantis of Daytona LLC andPierre Mamane and Eva Mamane Clothing andClothingAccessories Stores Term Loan Prime plus 2% 3/29/2041 491.7 491.7 499.9 0.18%^Marathon EngineeringCorporation MiscellaneousManufacturing Term Loan Prime plus2.75% 3/28/2041 43.7 43.7 45.9 0.02%^PHCDC1 LLC dba Quarter +Glory and Public House Collective,Corp. Food Services andDrinking Places Term Loan Prime plus2.75% 3/28/2026 43.8 43.8 41.3 0.01%^ReNew Interior Surface CleaningLLC Administrative andSupport Services Term Loan Prime plus2.75% 3/28/2026 10.8 10.8 10.9 —%^RCB Enterprises, Inc. Administrative andSupport Services Term Loan Prime plus2.75% 3/25/2026 49.2 49.2 44.3 0.02%^Revolution Physical Therapy LLCdba Apex Network PhysicalTherapy Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/25/2026 19.9 19.9 18.3 0.01%^Excel RP Inc MachineryManufacturing Term Loan Prime plus2.75% 3/25/2026 109.3 109.3 103.4 0.04%^ActKnowledge, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 3/24/2026 109.3 109.3 111.5 0.04%^International Construction Inc Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 3/24/2041 48.6 48.6 50.1 0.02%^Lowgap Grocery & Grill LLC GeneralMerchandise Stores Term Loan Prime plus2.75% 3/24/2041 162.7 162.7 173.9 0.06%^Flooring Liquidators Inc andPremier Flooring Yonkers Inc andFlooring Specialty TradeContractors Term Loan Prime plus2.75% 3/24/2026 43.7 43.7 44.0 0.02%^Acton Hardware LLC and MarkAllgood & Jamie Allgood Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 3/24/2041 484.7 484.7 491.8 0.18%^Magnation Corporation andMisha Family Trust MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 3/22/2041 98.6 98.6 105.4 0.04%^growth.period LLC and PotomacRecruiting LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/21/2026 136.6 136.6 122.9 0.04%^Precious Care LLC and PreciousCare Management LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/21/2026 488.0 488.0 441.6 0.16%^Media Capital Partners, Inc Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 3/21/2026 19.7 19.7 17.7 0.01%F-49See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Taylors Zinn Enterprises Inc dbaEons Auto Care Inc Repair andMaintenance Term Loan Prime plus2.75% 3/18/2041 78.4 78.4 83.2 0.03%^ERT Group Inc and Curt's ToolsInspection Inc Support Activitiesfor Mining Term Loan Prime plus2.75% 3/18/2041 1,229.8 1,229.8 1,269.0 0.46%^Kekoa Enterprises Inc dbaSignarama Sandy Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/18/2026 43.3 43.3 38.9 0.01%^Mariam Diner Inc dba CountryKitchen Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 3/18/2026 45.9 45.9 41.3 0.01%^Brian T Rice dba BD Logging Forestry andLogging Term Loan Prime plus2.75% 3/17/2026 13.8 13.8 13.0 —%^Demand Printing Solutions Inc. Printing and RelatedSupport Activities Term Loan Prime plus2.75% 3/16/2026 19.0 19.0 18.7 0.01%^Evergreen Pallet LLC andEvergreen Recycle LLC Wood ProductManufacturing Term Loan Prime plus2.75% 3/16/2026 918.7 918.7 864.7 0.31%^K Soles Corp dba MaxCollections MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 3/16/2026 19.7 19.7 17.7 0.01%^LAN Doctors Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/16/2026 48.1 48.1 49.1 0.02%^R & D Enterprises Inc dba MyPool Man Administrative andSupport Services Term Loan Prime plus2.75% 3/15/2026 43.7 43.7 39.3 0.01%^Mustafa Inc and RaoufProperties LLC Food and BeverageStores Term Loan Prime plus2.75% 3/14/2041 73.0 73.0 77.2 0.03%^HEWZ, LLC dba Hard ExerciseWorks Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/14/2026 19.6 19.6 17.7 0.01%^Country Paint and Hardware Inc Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 3/11/2026 76.4 76.4 70.0 0.03%^Wilban LLC Food Services andDrinking Places Term Loan Prime plus2.75% 3/11/2026 94.2 94.2 92.6 0.03%^Dupre Capital LLC dba Fastsigns MiscellaneousManufacturing Term Loan Prime plus2.75% 3/11/2026 51.1 51.1 45.9 0.02%^Magill Truck Line LLC and JeffJ. Ralls TruckTransportation Term Loan Prime plus2.75% 3/11/2029 193.4 193.4 183.9 0.07%^ABCs & 123s Infant and ChildCare Center LP Social Assistance Term Loan Prime plus2.75% 3/11/2026 9.8 9.8 8.8 —%^Accuair Control Systems LLCdba Accuair Suspension TransportationEquipmentManufacturing Term Loan Prime plus2.75% 3/11/2026 131.1 131.1 120.2 0.04%^State Painting & Decorating Co.,Inc. Specialty TradeContractors Term Loan Prime plus2.75% 3/10/2026 90.7 90.7 81.6 0.03%F-50See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^B.P.T.M. of NV LLC and AgentisBros., LLC Repair andMaintenance Term Loan Prime plus2.75% 3/9/2041 510.0 510.0 529.5 0.19%^Step Up Academy of the ArtsLLC Educational Services Term Loan Prime plus2.75% 3/9/2026 7.0 7.0 6.3 —%^A & A Auto Care LLC Repair andMaintenance Term Loan Prime plus2.75% 3/9/2026 10.8 10.8 10.7 —%^Faith Summit Supply Inc dbaSummit Supply and Summit TrueValue Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 3/9/2026 19.7 19.7 18.7 0.01%^Swerve Salon LLC Personal andLaundry Services Term Loan Prime plus2.75% 3/8/2026 69.1 69.1 62.1 0.02%^J & W Hardwood Flooring Inc Specialty TradeContractors Term Loan Prime plus2.75% 3/7/2026 6.6 6.6 5.9 —%^Labmates LLC and POV HoldingsLLC Miscellaneous StoreRetailers Term Loan Prime plus2.75% 3/4/2041 106.1 106.1 113.4 0.04%^Hueston and Company CPA LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/4/2026 7.1 7.1 6.5 —%^Almost Home Daycare LLC Social Assistance Term Loan Prime plus2.75% 3/3/2026 45.0 45.0 45.2 0.02%^Miles of Smiles Inc Food Services andDrinking Places Term Loan Prime plus2.75% 3/2/2026 83.3 83.3 76.3 0.03%^Living Essentials HVAC Corp Specialty TradeContractors Term Loan Prime plus2.75% 2/28/2026 13.0 13.0 11.8 —%^Consulting Solutions, Inc. andMark Luciani Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 2/28/2026 9.8 9.8 9.9 —%^Powerpits CS1, LLC dba Pita Pit Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2026 16.3 16.3 15.3 0.01%^Drug Detection Laboratories, Inc.and Minh Tran Ambulatory HealthCare Services Term Loan Prime plus2.75% 2/28/2026 17.2 17.2 15.7 0.01%^Doxa Deo Inc dba Luv 2 Play Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 2/28/2026 95.1 95.1 88.0 0.03%^The River Beas, LLC dba Subwayand Punam Singh Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2041 131.7 131.7 139.6 0.05%^Blackstones Hairdressing LLC Personal andLaundry Services Term Loan Prime plus2.75% 2/23/2026 45.4 45.4 41.2 0.01%^Aaradhya LLC dba MarketSquare Laundry Personal andLaundry Services Term Loan Prime plus2.75% 2/23/2026 69.4 69.4 62.5 0.02%^R-No-Landscaping LLC Personal andLaundry Services Term Loan Prime plus2.75% 2/19/2026 7.2 7.2 6.6 —%F-51See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^BER Enterprise 332 Inc dbaEdible Arrangements Food and BeverageStores Term Loan Prime plus2.75% 2/19/2026 19.5 19.5 17.7 0.01%^R & K Contracting Inc Specialty TradeContractors Term Loan Prime plus2.75% 2/18/2026 13.7 13.7 13.8 —%^Pacific Coast Medical GroupLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 2/17/2026 212.5 212.5 216.8 0.08%^B for Blonde, LLC dba Blo BlowDry Bar Personal andLaundry Services Term Loan Prime plus2.75% 2/12/2026 54.4 54.4 49.1 0.02%^Gilmore Heights DentalHoldings, LTD and Chas RobLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 2/12/2029 282.2 282.2 271.5 0.10%^Ei3 Corporation Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 2/12/2026 283.5 283.5 289.3 0.10%^Jersey Shore Marina & BoatSales, Inc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 2/12/2041 607.0 607.0 648.7 0.23%^Base USA, Inc. Clothing andClothingAccessories Stores Term Loan Prime plus2.75% 2/2/2026 43.4 43.4 44.3 0.02%^Zouk Ltd dba Palma Food Services andDrinking Places Term Loan Prime plus2.75% 1/29/2026 19.4 19.4 19.8 0.01%^Tammy Lavertue Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 1/28/2026 9.7 9.7 9.7 —%^Wildflour Bakery & Cafe LLC Social Assistance Term Loan Prime plus2.75% 1/28/2026 53.8 53.8 54.3 0.02%^SuzyQue's LLC dba SuzyQue's Food Services andDrinking Places Term Loan Prime plus2.75% 1/28/2026 19.4 19.4 19.8 0.01%^New Image Building Services,Inc. dba The Maids servingOakland Administrative andSupport Services Term Loan Prime plus2.75% 1/19/2026 71.6 71.6 67.0 0.02%^Gendron Funeral and CremationServices, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 1/11/2041 107.5 107.5 114.9 0.04%^Dolarian Realty LLC and OV'sRestaurant Inc Food Services andDrinking Places Term Loan Prime plus2.75% 1/5/2041 65.7 65.7 70.2 0.03%^Lemonberry Food Stores Inc dbaLemonberry Frozen Yogurt Food and BeverageStores Term Loan Prime plus2.75% 12/29/2025 96.1 96.1 89.1 0.03%^MCF Forte LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/29/2025 16.0 16.0 14.5 0.01%^Panditos LLC dba White LotusHome MiscellaneousManufacturing Term Loan Prime plus2.75% 12/28/2025 13.6 13.6 12.2 —%^Bright Dialysis LLC and FtPierce Kidney Care LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/28/2025 1,067.6 1,067.6 962.6 0.35%F-52See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^V2 Tango LLC dba Palette 22 Food Services andDrinking Places Term Loan Prime plus2.75% 12/23/2025 213.5 213.5 197.0 0.07%^Ridge Road Equestrian LLC dbaRicochet Ridge Ranch Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/23/2040 99.0 99.0 103.4 0.04%^800 on the Trax LLC and MatrixZ LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 12/23/2040 233.0 233.0 242.0 0.09%^Joyce Outdoor AdvertisingChicago LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/22/2040 291.8 291.8 301.7 0.11%^The LAX Shop Inc Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 12/22/2025 83.5 83.5 85.1 0.03%^Premier Athletic Center of OhioInc. and Gates Investments andWade Gates Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/22/2028 792.9 792.9 817.1 0.29%^Hattingh Incorporated dbaProsthetic Care Facility Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/21/2025 15.4 15.4 14.4 0.01%^G.W. Fitness Centers, LLC andJ.G. Fitness LLC and NP GymLLC and ANA Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/18/2040 990.3 990.3 1,057.7 0.38%^Trip Consultants U.S.A. Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/18/2025 149.5 149.5 134.4 0.05%^Jay Kevin Gremillion dba DinoSmiles Children's CosmeticDentistry Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/18/2025 64.0 64.0 58.9 0.02%^Capital Scrap Metal LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/18/2025 29.7 29.7 27.1 0.01%^Labmates LLC Miscellaneous StoreRetailers Term Loan Prime plus2.75% 12/18/2040 157.0 157.0 167.7 0.06%^Abbondanza Market LLC dbaHampton Falls Village Market Food and BeverageStores Term Loan Prime plus2.75% 12/18/2025 57.4 57.4 53.0 0.02%^Accent Tag and Label Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 12/18/2040 640.6 640.6 667.4 0.24%^Mustafa Inc dba Adiba Grocery Food and BeverageStores Term Loan Prime plus2.75% 12/17/2025 88.7 88.7 90.4 0.03%^Learning Skills LLC andChristopher Shrope EducationalServices Term Loan Prime plus2.75% 12/17/2025 9.2 9.2 8.3 —%^New York Home Health CareEquipment, LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/16/2025 758.9 758.9 767.4 0.28%^Moments to Remember USALLC dba Retain Loyalty Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/16/2025 64.1 64.1 62.4 0.02%F-53See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^JAG Unit 1, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/16/2025 213.5 213.5 192.0 0.07%^Abitino's JFK LLC dba Abitino's Food Services andDrinking Places Term Loan Prime plus2.75% 12/16/2022 98.1 98.1 91.4 0.03%^Swalm Sreet LLC and New YorkHome Health Care EquipmentLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/16/2040 363.7 363.7 384.7 0.14%^SDA Holdings LLC and LesCheveux Salon Inc Personal andLaundry Services Term Loan Prime plus2.75% 12/15/2040 417.7 417.7 429.7 0.15%^Evans & Paul LLC and E&PHoldings I LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 12/15/2025 106.8 106.8 98.6 0.04%^Basista Family LimitedPartnership and UPE, Inc. MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/14/2040 330.9 330.9 343.6 0.12%^DC Enterprises Ltd. dbaLakeview True Value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 12/14/2025 19.2 19.2 19.0 0.01%^Tri-State Remodeling &Investments, LLC Specialty TradeContractors Term Loan Prime plus2.75% 12/11/2025 13.6 13.6 13.6 —%^AGR Foodmart Inc dba NashuaRoad Mobil Gasoline Stations Term Loan Prime plus2.75% 12/11/2025 19.2 19.2 18.9 0.01%^Alexandra Afentoulides dba Vi'sPizza Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 12/11/2040 44.7 44.7 47.7 0.02%^Cares, Inc dba DumplingGrounds Day Care Center Social Assistance Term Loan Prime plus2.75% 12/10/2025 6.4 6.4 6.5 —%^Custom Exteriors, Inc. Specialty TradeContractors Term Loan Prime plus2.75% 12/9/2025 85.4 85.4 79.1 0.03%^Sushiya, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 12/8/2025 92.9 92.9 86.3 0.03%^My Jewels, LLC dba The UPSStore #6712 Administrative andSupport Services Term Loan Prime plus2.75% 12/7/2025 30.2 30.2 27.2 0.01%^Blue Ox Trucking Inc. TruckTransportation Term Loan Prime plus2.75% 12/4/2025 2.5 2.5 2.5 —%^Food & Fuel Company LLC dbaLowery Food Mart Food and BeverageStores Term Loan Prime plus2.75% 12/4/2040 118.4 118.4 126.4 0.05%^LC Blvd Holdings LLC and MtPleasant Wash & Wax LLC Repair andMaintenance Term Loan Prime plus2.75% 12/4/2040 486.4 486.4 510.5 0.18%^American Campgrounds LLC dbaWhit's End Campground Accommodation Term Loan Prime plus2.75% 12/4/2040 283.1 283.1 297.6 0.11%^Tariq, LLC dba 76 Food Mart Gasoline Stations Term Loan Prime plus2.75% 12/2/2040 362.3 362.3 380.7 0.14%^401 JJS, Corp and G. Randazzo'sTrattoria Corporation Food Services andDrinking Places Term Loan Prime plus2.75% 12/1/2040 51.3 51.3 53.2 0.02%F-54See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Delta Aggregate, LLC Mining (except Oiland Gas) Term Loan Prime plus2.75% 11/30/2025 90.7 90.7 92.5 0.03%^Hurshell Leon Dutton dba HighJump Party Rentals Rental and LeasingServices Term Loan Prime plus2.75% 11/30/2025 14.8 14.8 15.1 0.01%^Japp Business Inc dba Pick andEat and Japp Drink Corp. Food Services andDrinking Places Term Loan Prime plus2.75% 11/30/2025 106.1 106.1 99.5 0.04%^Smokeyard Inc dba SmokeyardBBQ and Chop Shop Food Services andDrinking Places Term Loan Prime plus2.75% 11/30/2025 105.9 105.9 97.0 0.03%^DWeb Studio, Inc. EducationalServices Term Loan Prime plus2.75% 11/25/2025 9.5 9.5 8.6 —%^State Painting and Decorating CoInc Specialty TradeContractors Term Loan Prime plus2.75% 11/25/2025 61.2 61.2 55.1 0.02%^Sambella Holdings, LLC andStrike Zone Entertainment CenterLLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 11/23/2040 738.3 738.3 784.0 0.28%^Play and Learn Child Care andSchool Inc Social Assistance Term Loan Prime plus2.75% 11/23/2025 9.4 9.4 9.6 —%^Ronny Ramirez RX Corp dbaNaturxheal Family Pharmacy Health and PersonalCare Stores Term Loan Prime plus2.75% 11/20/2025 76.4 76.4 69.8 0.03%^Haven Hospitality Group Inc. dbaHaven Gastropub Food Services andDrinking Places Term Loan Prime plus2.75% 11/20/2025 112.2 112.2 102.5 0.04%^CNYP 717 Irondequoit LLC andCNYP 2002 Ontario LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/20/2040 236.8 236.8 236.1 0.08%^S.B.B. Enterprises Inc dbaWilliamston Hardware Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/19/2040 104.7 104.7 104.6 0.04%^Key Pix Productions Inc. dba AirBud Entertainment Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 11/18/2040 608.0 608.0 649.4 0.23%^E.S.F.P. LLC dba Volusia Vanand Storage TruckTransportation Term Loan Prime plus2.75% 11/11/2025 75.4 75.4 69.2 0.02%^Green Life Lawnscapes LLC dbaGreen Life Lawn Care Administrative andSupport Services Term Loan Prime plus2.75% 11/6/2025 110.3 110.3 110.9 0.04%^Jumbomarkets Inc dba RinesJumbomarkets Food and BeverageStores Term Loan Prime plus2.75% 11/4/2025 259.4 259.4 260.5 0.09%^Bisson Transportation Inc dba I& R Associates and DocumentSecurity TruckTransportation Term Loan Prime plus2.75% 10/30/2025 18.9 18.9 18.5 0.01%^L.M. Jury Enterprises, Inc dbaMidwest Monograms Textile ProductMills Term Loan Prime plus2.75% 10/28/2025 65.7 65.7 60.0 0.02%^Top Cat Ready Mix, LLC, PlesInvestments LLC Specialty TradeContractors Term Loan Prime plus2.75% 10/28/2025 597.3 597.3 554.1 0.20%F-55See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Windsor Direct Distribution LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 10/26/2025 12.0 12.0 10.8 —%^Financial Network Recovery Administrative andSupport Services Term Loan Prime plus2.75% 10/26/2025 33.6 33.6 30.2 0.01%^Tannehill Enterprises Inc dbaHobbytown USA Folsom Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 10/14/2025 73.4 73.4 66.0 0.02%^ADMO Inc dba Mid StatesEquipment Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 10/8/2025 18.9 18.9 17.4 0.01%^Recycling Consultants, Inc. andPrairie State Salvage andRecycling Inc MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/30/2027 668.0 668.0 634.2 0.23%^SCJEN Management Inc dbaBowl of Heaven Food Services andDrinking Places Term Loan Prime plus2.75% 9/30/2025 60.0 60.0 53.9 0.02%^Naeem Khan LTD ApparelManufacturing Term Loan Prime plus2.75% 9/30/2025 104.1 104.1 93.5 0.03%^Accent Homes Services LLC dbaBenjamin Franklin Plumbing ofKansas City Specialty TradeContractors Term Loan Prime plus2.75% 9/30/2028 58.8 58.8 59.1 0.02%^Bat Bridge Investments Inc dbaKalologie 360 Spa Personal andLaundry Services Term Loan Prime plus2.75% 9/30/2025 72.7 72.7 65.3 0.02%^Binky's Vapes LLC Miscellaneous StoreRetailers Term Loan Prime plus2.75% 9/30/2025 18.7 18.7 16.8 0.01%^Barub Realty LLC and BarubLLC dba Woodlawn Cabinets Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 9/30/2040 137.5 137.5 146.6 0.05%^R.H. Hummer Jr., Inc. TruckTransportation Term Loan Prime plus2.75% 9/30/2025 324.3 324.3 321.5 0.12%^Greensward of Marco Inc. Administrative andSupport Services Term Loan Prime plus2.75% 9/28/2040 84.1 84.1 87.0 0.03%^RIM Investments LLC and RIMArchitects LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/28/2040 383.5 383.5 395.2 0.14%^The Grasso Companies LLC andGrasso Pavement MaintenanceLLC Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 9/28/2025 428.0 428.0 435.8 0.16%^Sandlot Ventures LLC andSandbox Ventures LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/25/2040 426.0 426.0 434.1 0.16%^Yachting Solutions LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 9/25/2040 925.2 925.2 941.5 0.34%^Prestigious LifeCare for SeniorsLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/25/2025 8.2 8.2 7.9 —%^Daniel W. Stark dba MountainValley Lodge and RV Park Accommodation Term Loan Prime plus2.75% 9/25/2040 13.0 13.0 13.8 —%F-56See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^St Lawrence Hotel Corp andOheka Catering Inc dba QualityInn Accommodation Term Loan Prime plus2.75% 9/24/2040 600.8 600.8 625.4 0.22%^Hagerstown Muffler, Inc. andJMS Muffler, Inc Repair andMaintenance Term Loan Prime plus2.75% 9/24/2040 314.8 314.8 336.0 0.12%^J.R. Wheeler Corporation dbaStructurz Exhibits and Graphics Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 10/24/2025 17.5 17.5 17.9 0.01%^Rutledge Enterprises Inc dba BLCProperty Management Administrative andSupport Services Term Loan Prime plus2.75% 9/23/2040 59.6 59.6 62.1 0.02%^Finish Strong Inc dbaFASTSIGNS St Peters MiscellaneousManufacturing Term Loan Prime plus2.75% 9/23/2025 41.7 41.7 37.4 0.01%^J3K LLC dba Ronan True ValueHardware Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 9/23/2025 127.1 127.1 114.1 0.04%^Nova Solutions Inc Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 9/22/2040 307.6 307.6 320.5 0.12%^Pine Belt Wood Products LLC Forestry andLogging Term Loan Prime plus2.75% 9/22/2040 157.4 157.4 154.5 0.06%^Sound Manufacturing Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/21/2025 41.6 41.6 39.1 0.01%^IIoka Inc dba New CloudNetworks Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/21/2025 556.8 556.8 500.0 0.18%^Vanderhoof LLC dba Soxfords ApparelManufacturing Term Loan Prime plus2.75% 9/18/2025 13.2 13.2 11.9 —%^MiJoy Inc dba Imo's Pizza Food Services andDrinking Places Term Loan Prime plus2.75% 9/18/2025 6.9 6.9 6.2 —%^Naeem Khan LTD ApparelManufacturing Term Loan Prime plus2.75% 9/17/2025 104.2 104.2 93.5 0.03%^Import Car Connection Inc dbaCar Connection Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 9/16/2040 391.7 391.7 415.0 0.15%^FirstVitals Health and WellnessInc MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/15/2025 125.0 125.0 112.2 0.04%^Almost Home Daycare LLC Social Assistance Term Loan Prime plus2.75% 9/11/2025 53.7 53.7 54.5 0.02%^Veliu LLC dba FASTSIGNS#15901 MiscellaneousManufacturing Term Loan Prime plus2.75% 9/10/2025 42.2 42.2 38.8 0.01%^B and A Friction Materials Inc MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/9/2025 82.6 82.6 74.2 0.03%^Gardner's Wharf Holdings LLCand Gardner's Wharf Seafood Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 9/8/2040 134.6 134.6 143.6 0.05%F-57See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^AIG Inc Specialty TradeContractors Term Loan Prime plus2.75% 9/4/2040 349.7 349.7 352.6 0.13%^Empower Autism Academy Social Assistance Term Loan Prime plus2.75% 9/4/2040 658.5 658.5 702.8 0.25%^Higher Grounds CommunityCoffeehouse, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/2/2025 6.9 6.9 6.4 —%^Delray Scrap Recycling LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 8/31/2025 18.4 18.4 16.5 0.01%^The Camera House Inc MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 8/31/2025 1,041.2 1,041.2 998.9 0.36%^LAN Doctors Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/28/2025 67.1 67.1 64.0 0.02%^Elite Institute LLC dbaHuntington Learning Center EducationalServices Term Loan Prime plus2.75% 8/28/2025 12.5 12.5 11.3 —%^J and K Fitness L.L.C. dbaPhysiques Womens Fitness Center Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 2/28/2041 91.1 91.1 95.9 0.03%^Zephyr Seven Series LLC dba18/8 Fine Men's Salon Personal andLaundry Services Term Loan Prime plus2.75% 8/28/2025 69.6 69.6 63.7 0.02%^B and J Catering Inc dbaCulinary Solutions Food Services andDrinking Places Term Loan Prime plus2.75% 8/27/2040 532.9 532.9 544.2 0.20%^3000 CSI Property LLC andConsulting Solutions Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/20/2040 132.3 132.3 139.9 0.05%^God Be Glorified Inc dba GBGInc Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 8/20/2025 43.8 43.8 39.3 0.01%^GDP Gourmet LLC dba Joe andJohn's Pizza Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 8/19/2040 139.1 139.1 144.2 0.05%^Gold Jet Corp. Couriers andMessengers Term Loan Prime plus2.75% 8/14/2025 59.5 59.5 56.7 0.02%^SKJ Inc dba Subway Food Services andDrinking Places Term Loan Prime plus2.75% 8/13/2025 70.0 70.0 63.6 0.02%^LP Industries Inc dba Childforms Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 7/29/2025 102.4 102.4 100.0 0.04%^Pauley Tree and Lawn Care Inc Administrative andSupport Services Term Loan Prime plus2.75% 7/28/2025 53.8 53.8 50.7 0.02%^Beale Street Blues Company-WestPalm Beach LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 7/24/2025 54.3 54.3 50.3 0.02%^Forever & Always of Naples Incdba Island Animal Hospital Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 7/24/2025 80.9 80.9 77.7 0.03%F-58See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Smart Artists Inc. Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 7/23/2025 18.4 18.4 16.6 0.01%^Free Ion Advisors LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 7/21/2025 52.6 52.6 47.3 0.02%^Murrayville Donuts, Inc dbaDunkin' Donuts Food and BeverageStores Term Loan Prime plus2.75% 7/15/2040 333.8 333.8 340.8 0.12%^Union 2 LLC dba The Standard Food Services andDrinking Places Term Loan Prime plus2.75% 7/10/2025 80.3 80.3 77.3 0.03%^Thrifty Market, Inc. dba ThriftyFoods Food and BeverageStores Term Loan Prime plus2.75% 6/30/2030 234.9 234.9 238.7 0.09%^Danny V, LLC dba Hugo'sTaproom Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2040 44.3 44.3 47.1 0.02%^Anglin Cultured Stone ProductsLLC dba Anglin Construction Specialty TradeContractors Term Loan Prime plus2.75% 6/30/2025 228.8 228.8 227.8 0.08%^Jonathan E Nichols and NicholsFire and Security LLC Administrative andSupport Services Term Loan Prime plus2.75% 6/30/2025 60.9 60.9 62.1 0.02%^BJ's Tavern LLC and BJ's CabanaBar Inc Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2040 203.2 203.2 219.3 0.08%^Myclean Inc. Personal andLaundry Services Term Loan Prime plus2.75% 6/29/2025 12.9 12.9 12.7 —%^Summit Beverage Group LLC Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 8/29/2030 261.7 261.7 267.9 0.10%^Advanced Skincare MedcenterInc dba Advanced SkincareSurgery Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/29/2025 274.0 274.0 270.3 0.10%^CEM Autobody LLC dba Dawn'sAutobody Repair andMaintenance Term Loan Prime plus2.75% 6/26/2040 129.6 129.6 139.0 0.05%^TJU-DGT Inc dba The LorenzCafe Food Services andDrinking Places Term Loan Prime plus2.75% 6/26/2029 18.2 18.2 19.1 0.01%^Jihan Inc dba ARCO AM/PM andDiana Inc dba Diana's Recycling Gasoline Stations Term Loan Prime plus2.75% 6/26/2040 363.4 363.4 391.2 0.14%^SofRep, Inc dba Force 12 Media Other InformationServices Term Loan Prime plus2.75% 6/26/2025 53.8 53.8 52.7 0.02%^E & G Enterprises LLC dbaComfort Keepers Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/26/2025 18.3 18.3 17.9 0.01%^Ohs Auto Body, Inc. dba OhsBody Shop Repair andMaintenance Term Loan 7.465% 6/25/2040 1,167.1 1,167.1 1,251.2 0.45%^Wolf Enviro Interests, LLC andEnviromax Services Inc Administrative andSupport Services Term Loan Prime plus2.75% 6/25/2040 236.2 236.2 250.2 0.09%^Evinger PA One, Inc. dba PostalAnnex, Falcon Miscellaneous StoreRetailers Term Loan Prime plus2.75% 6/24/2025 18.3 18.3 18.3 0.01%F-59See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Richards Plumbing and HeatingCo., Inc. dba Richards Mechanical Specialty TradeContractors Term Loan Prime plus2.75% 6/23/2040 527.6 527.6 575.2 0.21%^RJI Services, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/23/2025 18.1 18.1 17.7 0.01%^Real Help LLC dba Real HelpDecorative Concrete Administrative andSupport Services Term Loan Prime plus2.75% 6/22/2025 43.1 43.1 44.4 0.02%^PM Cassidy Enterprises, Inc. dbaJunk King Waste Managementand RemediationServices Term Loan Prime plus2.75% 6/19/2025 12.1 12.1 11.9 —%^KRN Logistics, LLC andNewsome Trucking, Inc TruckTransportation Term Loan Prime plus2.75% 6/19/2025 448.4 448.4 450.6 0.16%^Inverted Healthcare Staffing ofFlorida LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/18/2025 49.7 49.7 48.8 0.02%^Flooring Liquidators Inc andFlooring Liquidators of Mt KiscoLLC Specialty TradeContractors Term Loan Prime plus2.75% 6/17/2025 378.7 378.7 389.6 0.14%^AM PM Properties, LLC and AMPM Willington, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/17/2040 83.0 83.0 90.2 0.03%^Nelson Sargsyan dba HDATrucking Support Activitiesfor Transportation Term Loan Prime plus2.75% 6/16/2025 105.9 105.9 103.8 0.04%^Bizzare Foods Inc dba TrooperFoods MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 6/12/2025 95.6 95.6 93.8 0.03%^Mirage Plastering Inc and MpireLLC and Mpire II LLC Specialty TradeContractors Term Loan Prime plus2.75% 6/12/2040 132.7 132.7 139.0 0.05%^Anturio Marketing Inc dba LogicConsulting Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/12/2040 277.6 277.6 302.6 0.11%^Eldredge Tavern LLC dbaGonyea's Tavern Food Services andDrinking Places Term Loan Prime plus2.75% 6/8/2040 53.8 53.8 58.6 0.02%^Nicor LLC dba FibrenewSacramento Repair andMaintenance Term Loan Prime plus2.75% 6/5/2022 9.7 9.7 9.4 —%^Chitalian Fratelli LLC dbaFrancesca Brick Oven Pizza andPasta Food Services andDrinking Places Term Loan Prime plus2.75% 6/5/2025 12.7 12.7 12.5 —%^ViAr Visual Communications,Inc. dba Fastsigns 281701 MiscellaneousManufacturing Term Loan Prime plus2.75% 6/5/2025 50.3 50.3 49.8 0.02%^Video Vault & Tanning LLC andMosaic Salon LLC Rental and LeasingServices Term Loan Prime plus2.75% 6/4/2040 86.6 86.6 94.4 0.03%^Medworxs LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/3/2025 101.5 101.5 99.8 0.04%^XCESSIVE THROTTLE, INC dbaJake's Roadhouse Food Services andDrinking Places Term Loan Prime plus2.75% 5/29/2025 6.7 6.7 6.5 —%F-60See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Villela CPA PL Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 5/27/2025 7.2 7.2 7.2 —%^God is Good LLC dba BurgerFi Food Services andDrinking Places Term Loan Prime plus2.75% 5/27/2025 11.4 11.4 11.8 —%^Douglas Posey and SallyWatkinson dba Audrey'sFarmhouse Accommodation Term Loan Prime plus2.75% 5/20/2040 166.2 166.2 180.0 0.06%^Pen Tex Inc dba The UPS Store Administrative andSupport Services Term Loan Prime plus2.75% 5/20/2025 17.7 17.7 17.4 0.01%^Capstone Pediatrics PLLC andCapstone Healthcare ConsultingLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 5/15/2025 579.6 579.6 573.0 0.21%^15 McArdle LLC and No OtherImpressions Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 5/15/2040 245.5 245.5 261.7 0.09%^Guard Dogs MFS LLC Repair andMaintenance Term Loan Prime plus2.75% 5/8/2025 52.3 52.3 51.5 0.02%^George S Cochran DDS Inc Ambulatory HealthCare Services Term Loan Prime plus2.75% 5/7/2025 105.1 105.1 103.1 0.04%^South Park Properties LLC andMidlothian Hardware LLC Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 5/6/2040 161.7 161.7 176.2 0.06%^Matthew Taylor and LandonFarm LLC Personal andLaundry Services Term Loan Prime plus2.75% 5/4/2040 96.1 96.1 101.0 0.04%^Cares Inc dba DumplingGrounds Day Care Center Social Assistance Term Loan Prime plus2.75% 5/1/2040 77.3 77.3 84.3 0.03%^Orchid Enterprises Inc dbaAssisting Hands of Sussex County Ambulatory HealthCare Services Term Loan Prime plus2.75% 4/24/2025 12.0 12.0 11.7 —%^Ragazza Restaurant Group, Inc.dba Bambolina Food Services andDrinking Places Term Loan Prime plus2.75% 4/21/2025 17.2 17.2 17.1 0.01%^Diamond Solutions LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 4/21/2025 17.0 17.0 16.7 0.01%^Giacchino Maritime ConsultantsInc Personal andLaundry Services Term Loan Prime plus2.75% 4/17/2025 17.9 17.9 17.6 0.01%^Sound Coaching Inc Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 4/14/2025 35.4 35.4 34.7 0.01%^Faramarz Nikourazm dba CarClinic Center Repair andMaintenance Term Loan Prime plus2.75% 4/3/2040 70.1 70.1 75.4 0.03%^Advance Case Parts RE HoldingsLLC and Advance Case Parts Inc Repair andMaintenance Term Loan Prime plus2.75% 3/31/2040 707.0 707.0 751.1 0.27%F-61See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^T and B Boots Inc dba Takken'sShoes Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 3/31/2025 130.3 130.3 134.3 0.05%^Havana Central NJ1, LLC dbaHavana Central Food Services andDrinking Places Term Loan Prime plus2.75% 3/31/2025 218.9 218.9 225.2 0.08%^Mid-South Lumber Co. ofNorthwest Florida, Inc. MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 3/31/2040 407.8 407.8 432.3 0.16%^Copper Beech Financial GroupLLC Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 3/30/2025 98.8 98.8 99.4 0.04%^Delta Aggregate LLC Mining (except Oiland Gas) Term Loan Prime plus2.75% 3/30/2025 78.9 78.9 81.3 0.03%^Sunset Marine Resort LLC andGoXpeditions LLC Accommodation Term Loan Prime plus2.75% 3/27/2040 287.0 287.0 312.7 0.11%^Foresite Realty Partners LLC andForesite Real Estate Holdings LLC Real Estate Term Loan Prime plus2.75% 3/27/2025 979.0 979.0 958.7 0.34%^Shellhorn and Hill Inc dba TotalFleet Service Nonstore Retailers Term Loan Prime plus2.75% 3/27/2040 985.7 985.7 1,044.9 0.38%^Shorr Enterprises Inc dba NewDesign Furniture Manufacturers Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 3/27/2025 84.3 84.3 85.2 0.03%^Geo Los Angeles LLC dba GeoFilm Group Rental and LeasingServices Term Loan Prime plus2.75% 3/26/2025 102.8 102.8 103.7 0.04%^Joyce Outdoor Advertising NJLLC and Joyce OutdoorAdvertising LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/26/2040 51.4 51.4 55.8 0.02%^Zero-In Media Inc Data Processing,Hosting, and RelatedServices Term Loan Prime plus2.75% 3/25/2025 17.8 17.8 17.4 0.01%^Carpet Exchange of North TexasInc and Clyde E. Cumbie Jr Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 3/25/2040 770.5 770.5 838.3 0.30%^Loriet LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 3/24/2025 9.5 9.5 9.3 —%^Shelton Incorporated dba Mrs.Winners Food Services andDrinking Places Term Loan Prime plus2.75% 3/20/2040 107.0 107.0 116.5 0.04%^Jaymie Hazard dba Indigo HairStudio and Day Spa Personal andLaundry Services Term Loan Prime plus2.75% 3/20/2040 41.1 41.1 44.1 0.02%^R & R Security and InvestigationsInc dba Pardners Lake Buchanan Food Services andDrinking Places Term Loan Prime plus2.75% 3/19/2040 81.3 81.3 88.5 0.03%^MMS Realty, LLC and MolecularMS Diagnostics LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/18/2040 152.9 152.9 163.7 0.06%^Royal Crest Motors LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 3/16/2040 86.8 86.8 93.4 0.03%F-62See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^BND Sebastian Limited LiabilityCompany and Sebastian Fitness Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/16/2040 164.1 164.1 177.5 0.06%^Douglas Printy Motorsports, Inc.dba Blackburn Trike Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 3/9/2040 182.4 182.4 195.3 0.07%^Luigi's on Main LLC and Luigi'sMain Street Pizza Inc Food Services andDrinking Places Term Loan Prime plus2.75% 3/4/2025 8.9 8.9 9.2 —%^Baystate Firearms and Training,LLC Educational Services Term Loan Prime plus2.75% 2/27/2025 49.5 49.5 48.7 0.02%^Kingseal LLC dba Desoto Healthand Rehab Center Nursing andResidential CareFacilities Term Loan Prime plus2.75% 2/26/2040 1,192.7 1,192.7 1,299.2 0.47%^Pace Motor Lines, Inc. TruckTransportation Term Loan Prime plus2.75% 2/26/2025 51.7 51.7 53.3 0.02%^Nelson Financial Services LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 2/24/2025 9.8 9.8 9.5 —%^Kiddie Steps 4 You Inc. Social Assistance Term Loan Prime plus2.75% 2/19/2040 58.9 58.9 63.0 0.02%^Triangle Trash LLC dba BinThere Dump That Waste Managementand RemediationServices Term Loan Prime plus2.75% 2/18/2025 58.2 58.2 58.4 0.02%^Silva Realty Holdings, LLC andMF-Silva Enterprises, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 2/11/2040 163.0 163.0 174.3 0.06%^740 Barry Street Realty LLC andWild Edibles Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 2/10/2040 467.6 467.6 509.4 0.18%^Kostekos Inc dba New YorkStyle Pizza Food Services andDrinking Places Term Loan Prime plus2.75% 2/6/2040 63.0 63.0 67.7 0.02%^DuCharme Realty LLC andDuCharme Enterprises LLC Wood ProductManufacturing Term Loan Prime plus2.75% 2/2/2040 213.8 213.8 227.8 0.08%^Dean 1021 LLC dba Pure Pita Food Services andDrinking Places Term Loan Prime plus2.75% 4/29/2025 63.4 63.4 62.5 0.02%^Limameno LLC dba Sal's ItalianRistorante Food Services andDrinking Places Term Loan Prime plus2.75% 1/23/2025 64.6 64.6 63.9 0.02%^Palmabak Inc dba Mami Nora's Food Services andDrinking Places Term Loan Prime plus2.75% 1/22/2025 12.4 12.4 12.8 —%^Jung Design Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 1/20/2022 5.4 5.4 5.2 —%^Grand Blanc Lanes, Inc. and H,H and H, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/31/2039 126.0 126.0 136.8 0.05%^Bear Creek Entertainment, LLCdba The Woods at Bear Creek Accommodation Term Loan Prime plus2.75% 12/30/2024 85.4 85.4 87.9 0.03%F-63See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Evans and Paul LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/30/2024 172.0 172.0 176.2 0.06%^FHJE Ventures LLC andEisenreich II Inc dba BreakneckTavern Food Services andDrinking Places Term Loan Prime plus2.75% 12/30/2039 233.6 233.6 248.2 0.09%^First Prevention and DialysisCenter, LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/30/2024 221.9 221.9 225.7 0.08%^Bowlerama Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/24/2039 1,139.4 1,139.4 1,240.2 0.45%^401 JJS Corporation and G.Randazzo Corporation Food Services andDrinking Places Term Loan Prime plus2.75% 12/23/2039 452.7 452.7 489.7 0.18%^The Lodin Group LLC andLodin Health Imaging Inc dbaHighlands Breast Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/23/2039 501.7 501.7 531.9 0.19%^Thermoplastic Services Inc andParagon Plastic Sheet, Inc Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 12/23/2039 473.1 473.1 514.9 0.18%^Atlantis of Daytona LLC andOcean Club Sportswear Inc Clothing andClothingAccessories Stores Term Loan Prime plus2.75% 12/23/2039 194.1 194.1 211.3 0.08%^Beale Street Blues Company-West Palm Beach, LLC dbaLafayette Music Hall Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 12/22/2024 144.2 144.2 143.5 0.05%^MM and M Management Inc dbaPizza Artista Food Services andDrinking Places Term Loan Prime plus2.75% 4/19/2025 36.7 36.7 36.2 0.01%^B.S. Ventures LLC dba Dink'sMarket MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/19/2039 50.9 50.9 55.4 0.02%^The Jewelers Inc. dba TheJewelers of Las Vegas Clothing andClothingAccessories Stores Term Loan Prime plus2.75% 12/19/2024 961.0 961.0 943.3 0.34%^Will Zac Management LLC dbaPapa John's Food Services andDrinking Places Term Loan 6.25% 12/19/2024 130.7 121.7 134.5 0.05%^B & W Towing, LLC andBoychucks Fuel LLC Repair andMaintenance Term Loan Prime plus2.75% 12/17/2039 155.5 155.5 166.1 0.06%^All American Games, LLC andSportslink - The Game, LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 12/10/2024 307.5 307.5 306.9 0.11%^Kemmer LLC and Apples TreeTop Liquors LLC Food and BeverageStores Term Loan Prime plus2.75% 12/4/2039 130.9 130.9 139.3 0.05%^The Red Pill Management, Inc.dba UFC Gym Matthews Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 11/26/2024 42.0 42.0 41.8 0.02%^Teamnewman Enterprises LLCdba Newmans at 988 and John H.Newman Food Services andDrinking Places Term Loan Prime plus2.75% 11/25/2039 141.5 141.5 151.5 0.05%^DeRidder Chiropractic LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/25/2024 10.1 10.1 10.3 —%F-64See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Modern Manhattan LLC Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 11/25/2024 167.5 167.5 164.7 0.06%^Legacy Estate Planning Inc dbaAmerican Casket Enterprises Personal andLaundry Services Term Loan Prime plus2.75% 11/21/2024 32.0 32.0 31.3 0.01%^J&D Resources, LLC dba AquaScience Specialty TradeContractors Term Loan Prime plus2.75% 11/21/2024 578.9 578.9 570.4 0.20%^DC Real LLC and DC EnterprisesLTD dba Lakeview True Value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/20/2039 113.3 113.3 122.5 0.04%^MLM Enterprises LLC andDemand Printing Solutions Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 11/18/2024 53.7 53.7 54.4 0.02%^JEJE Realty LLC and La FamiliaInc Food Services andDrinking Places Term Loan Prime plus2.75% 11/10/2039 171.2 171.2 184.3 0.07%^Joey O's LLC and JenniferOlszewski Specialty TradeContractors Term Loan Prime plus2.75% 11/7/2024 0.7 0.7 0.7 —%^Heartland American PropertiesLLC and Skaggs RV Outlet LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 10/31/2039 451.5 451.5 487.6 0.18%^Golden Transaction Corporationdba Bleh Sunoco Gasoline Stations Term Loan Prime plus2.75% 10/30/2039 147.7 147.7 160.1 0.06%^Seelan Inc dba CandleridgeMarket Gasoline Stations Term Loan Prime plus2.75% 10/27/2039 85.3 85.3 91.4 0.03%^Navdeep B Martins and BusyBubbles LLC dba Wishy Washy Personal andLaundry Services Term Loan Prime plus2.75% 10/24/2039 84.0 84.0 89.4 0.03%^One Hour Jewelry Repair Inc Repair andMaintenance Term Loan Prime plus2.75% 10/14/2024 15.5 15.5 15.2 0.01%^DNT Storage and Properties LLC Real Estate Term Loan Prime plus2.75% 10/10/2039 95.9 95.9 104.0 0.04%^Sound Manufacturing Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 10/10/2024 141.3 141.3 140.5 0.05%^Return to Excellence, Inc. dbaThe Waynesville Inn Golf & Spa Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/10/2039 1,192.8 1,192.8 1,298.3 0.47%^Smith Spinal Care Center P.C.and James C. Smith Ambulatory HealthCare Services Term Loan Prime plus2.75% 10/8/2039 56.6 56.6 61.0 0.02%^Doctors Express Management ofCentral Texas LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 10/8/2024 70.0 70.0 71.6 0.03%^Michael Rey Jr. and Lynn J.Williams and GIG Petcare Personal andLaundry Services Term Loan Prime plus2.75% 10/3/2039 116.8 116.8 126.5 0.05%^Sumad LLC dba BrightStar Careof Encinitas Administrative andSupport Services Term Loan Prime plus2.75% 10/2/2024 40.1 40.1 41.2 0.01%F-65See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Roccos LLC and Sullo PantaloneInc dba Rocco's Food Services andDrinking Places Term Loan Prime plus2.75% 9/30/2039 240.6 240.6 256.9 0.09%^Keller Holdings LLC and DavidH Keller III and Carie C Keller Scenic andSightseeingTransportation Term Loan Prime plus2.75% 9/30/2039 94.1 94.1 102.2 0.04%^Orange County InsuranceBrokerage Inc dba BeatyInsurance Agency Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 9/29/2039 306.9 306.9 333.8 0.12%^The Woods at Bear Creek LLCand Bear Creek EntertainmentLLC Accommodation Term Loan Prime plus2.75% 9/29/2039 489.6 489.6 532.5 0.19%^Gordon E Rogers dbaStonehouse Motor Inn Accommodation Term Loan Prime plus2.75% 9/26/2039 54.1 54.1 58.8 0.02%^Auto Shine Carwash Inc andAKM R. Hossain and Jessica F.Masud Gasoline Stations Term Loan Prime plus2.75% 9/26/2024 16.8 16.8 16.6 0.01%^Keys Phase One LLC dba TheGrand Guesthouse Accommodation Term Loan Prime plus2.75% 9/26/2039 696.2 696.2 752.3 0.27%^6 Price Avenue, LLC and PauleyTree & Lawn Care, Inc Administrative andSupport Services Term Loan Prime plus2.75% 9/24/2039 432.6 432.6 456.4 0.16%^North Columbia LLC and LoopLiquor and Convenience StoreLLC Food and BeverageStores Term Loan Prime plus2.75% 9/24/2039 150.0 150.0 162.0 0.06%^Andrene's LLC dba Andrene'sCaribbean Soul Food Carry Out Food Services andDrinking Places Term Loan Prime plus2.75% 9/23/2024 23.4 23.4 22.9 0.01%^Ryan Crick and Pamela J. Crickand Crick Enterprises Inc Repair andMaintenance Term Loan Prime plus2.75% 9/17/2039 136.9 136.9 148.9 0.05%^Modern Leather Goods RepairShop Inc Repair andMaintenance Term Loan Prime plus2.75% 9/17/2024 43.4 43.4 42.4 0.02%^Tavern Properties LLC andWildwood Tavern LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/15/2039 402.5 402.5 434.3 0.16%^Animal Intrusion PreventionSystems Holding Company, LLC Administrative andSupport Services Term Loan Prime plus2.75% 9/15/2024 204.5 204.5 204.1 0.07%^KW Zion, LLC and Key WestGallery Inc Miscellaneous StoreRetailers Term Loan Prime plus2.75% 9/12/2039 1,176.2 1,176.2 1,270.9 0.46%^Indy East Smiles YouthDentistry LLC dba Prime SmileEast Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/11/2024 470.6 470.6 460.7 0.17%^B&P Diners LLC dba EngineHouse Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 9/10/2024 59.7 59.7 58.4 0.02%^Feel The World Inc dba XeroShoes and Invisible Shoes Leather and AlliedProductManufacturing Term Loan Prime plus2.75% 9/5/2024 38.8 38.8 38.2 0.01%^Delta Aggregate LLC Mining (except Oiland Gas) Term Loan Prime plus2.75% 8/28/2039 859.0 859.0 934.3 0.34%^Lamjam LLC, GoldsmithLambros Inc Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 8/27/2024 100.0 100.0 102.8 0.04%F-66See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Orange County Cleaning Inc Administrative andSupport Services Term Loan Prime plus2.75% 8/27/2024 23.5 23.5 22.9 0.01%^Qycell Corporation Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 8/26/2024 89.3 89.3 89.7 0.03%^Atlas Auto Body Inc dba AtlasAuto Sales Repair andMaintenance Term Loan Prime plus2.75% 8/22/2039 48.4 48.4 51.9 0.02%^Katie Senior Care LLC dba HomeInstead Senior Care Social Assistance Term Loan Prime plus2.75% 8/15/2024 91.9 91.9 89.8 0.03%^Alpha Preparatory Academy LLC Social Assistance Term Loan Prime plus2.75% 8/15/2039 136.9 136.9 148.9 0.05%^S&P Holdings of Daytona LLC,S&P Corporation of DaytonaBeach Miscellaneous StoreRetailers Term Loan Prime plus2.75% 8/15/2039 384.5 384.5 418.2 0.15%^Hamer Road Auto Salvage, LLCand Scott T. Cook and Nikki J.Cook Motor Vehicle andParts Dealers Term Loan 6% 8/8/2039 177.0 177.0 192.5 0.07%^Almost Home Property LLC andAlmost Home Daycare LLC Social Assistance Term Loan Prime plus2.75% 8/7/2039 677.8 677.8 734.8 0.26%^AGV Enterprises LLC dba Jet'sPizza #42 Food Services andDrinking Places Term Loan Prime plus2.75% 7/31/2024 40.1 40.1 39.5 0.01%^iFood, Inc. dba Steak N Shake Food Services andDrinking Places Term Loan Prime plus2.75% 7/31/2024 288.2 288.2 289.1 0.10%^575 Columbus Avenue HoldingCompany, LLC and LA-ZE LLCdba EST EST EST Food Services andDrinking Places Term Loan Prime plus2.75% 7/30/2039 20.4 20.4 22.1 0.01%^Honeyspot Investors LLP andPace Motor Lines Inc TruckTransportation Term Loan Prime plus2.75% 7/24/2039 140.6 140.6 152.9 0.05%^Miss Cranston Diner II, LLC andMiss Cranston II Realty LLC Food Services andDrinking Places Term Loan Prime plus2.75% 7/17/2039 95.8 95.8 103.2 0.04%^AMG Holding, LLC and StetsonAutomotive, Inc Repair andMaintenance Term Loan Prime plus2.75% 6/30/2039 194.6 194.6 213.9 0.08%^Highway Striping Inc Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 6/30/2024 38.5 38.5 39.3 0.01%^Lisle Lincoln II LimitedPartnership dba Lisle Lanes LP Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/30/2024 72.3 72.3 74.8 0.03%^Honeyspot Investors LLP andPace Motor Lines Inc TruckTransportation Term Loan Prime plus2.75% 6/30/2039 820.1 820.1 901.2 0.32%^iFood, Inc. dba Steak N Shake Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2039 590.9 590.9 643.1 0.23%^FHJE Ventures LLC andEisenreich II Inc. dba BreakneckTavern Food Services andDrinking Places Term Loan Prime plus2.75% 6/27/2039 301.1 301.1 329.8 0.12%^Zinger Hardware and GeneralMerchant Inc Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 6/26/2024 45.0 45.0 46.5 0.02%F-67See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^JPM Investments LLC andCarolina Family Foot Care P.A. Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/26/2039 132.6 132.6 145.4 0.05%^Nikobella Properties LLC andJPO Inc dba Village Car Wash Repair andMaintenance Term Loan Prime plus2.75% 6/25/2039 449.3 449.3 492.3 0.18%^Big Sky Plaza LLC andStrickland, Incorporated dbaLivingston True Value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 6/20/2039 218.4 218.4 239.2 0.09%^510 ROK Realty LLC dba ROKHealth and Fitness and Robert N.D'urso Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/19/2024 251.4 251.4 259.9 0.09%^Nirvi Enterprises LLC dbaHoward Johnson / Knights Inn Accommodation Term Loan Prime plus2.75% 6/17/2039 861.0 861.0 946.2 0.34%^Global Educational DeliveryServices LLC Educational Services Term Loan Prime plus2.75% 6/16/2024 43.9 43.9 45.4 0.02%^Rainbow Dry Cleaners Personal andLaundry Services Term Loan Prime plus2.75% 6/13/2024 90.5 90.5 92.5 0.03%^NVR Corporation dba DiscountFood Mart Food and BeverageStores Term Loan Prime plus2.75% 6/11/2039 61.7 61.7 67.8 0.02%^Sico & Walsh Insurance AgencyInc and The AMS Trust Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 6/6/2039 87.8 87.8 96.5 0.03%^Sujata Inc dba Stop N Save FoodMart and Dhruvesh Patel Food and BeverageStores Term Loan Prime plus2.75% 6/3/2024 16.3 16.3 16.6 0.01%^Long Island Barber + BeautyLLC Educational Services Term Loan Prime plus2.75% 6/2/2039 51.9 51.9 56.8 0.02%^CJR LLC, and PowerWash Plus,Inc. Repair andMaintenance Term Loan Prime plus2.75% 5/30/2024 37.9 37.9 39.1 0.01%^Pocono Coated Products, LLC Printing and RelatedSupport Activities Term Loan Prime plus2.75% 5/30/2024 16.1 16.1 16.6 0.01%^Wilton Dental Care P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 5/29/2024 93.7 93.7 95.3 0.03%^EGM Food Services Inc dbaGold Star Chili Food Services andDrinking Places Term Loan Prime plus2.75% 5/29/2024 13.8 13.8 14.1 0.01%^Jonesboro Health Food CenterLLC Health and PersonalCare Stores Term Loan Prime plus2.75% 5/27/2024 43.0 43.0 43.7 0.02%^Hae M. and Jin S. Park dbaBuford Car Wash Repair andMaintenance Term Loan Prime plus2.75% 5/15/2039 154.8 154.8 169.1 0.06%^The River Beas LLC and PunamSingh Food Services andDrinking Places Term Loan Prime plus2.75% 5/8/2039 84.6 84.6 92.7 0.03%^AS Boyals LLC dba TowneLiquors Food and BeverageStores Term Loan Prime plus2.75% 4/29/2039 101.5 101.5 111.5 0.04%F-68See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Gerami Realty, LC, SherrillUniversal City Corral, LP Food Services andDrinking Places Term Loan Prime plus2.75% 4/23/2027 62.9 62.9 65.9 0.02%^Complete Body & Paint, Inc. Repair andMaintenance Term Loan Prime plus2.75% 4/23/2039 19.5 19.5 21.4 0.01%^Island Wide Realty LLC andLong Island Partners, Inc. Real Estate Term Loan Prime plus2.75% 4/22/2039 96.8 96.8 106.4 0.04%^Wilshire Media Systems Inc Specialty TradeContractors Term Loan Prime plus2.75% 4/17/2024 132.1 132.1 134.7 0.05%^1899 Tavern & Tap LLC and AleHouse Tavern & Tap LLC Food Services andDrinking Places Term Loan Prime plus2.75% 4/9/2039 127.2 127.2 139.6 0.05%^Dantanna's Tavern LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2024 117.7 117.7 120.4 0.04%^Little People's Village II LLC andIliopoulos Realty LLC Social Assistance Term Loan Prime plus2.75% 3/31/2039 86.2 86.2 94.0 0.03%^Hodges Properties LLC andEchelon Enterprises Inc dbaTreads Bicycle Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 3/31/2039 417.7 417.7 457.7 0.16%^Little People's Village II LLC andIliopoulos Realty LLC Social Assistance Term Loan Prime plus2.75% 3/31/2039 95.1 95.1 103.7 0.04%^Eagle Aggregate Transportation,LLC and Eagle PneumaticTransport LLC TruckTransportation Term Loan Prime plus2.75% 3/31/2024 522.7 522.7 537.3 0.19%^Kemmer, LLC and Pitts PackageStore, Inc. Food and BeverageStores Term Loan Prime plus2.75% 3/31/2039 109.5 109.5 118.9 0.04%^Lake Area Autosound LLC andRyan H. Whittington Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 7/28/2039 118.0 118.0 129.2 0.05%^Wilban LLC Food Services andDrinking Places Term Loan Prime plus2.75% 3/28/2039 402.7 402.7 440.9 0.16%^Knowledge First Inc dba MagicYears of Learning and KimberlyKnox Social Assistance Term Loan Prime plus2.75% 3/21/2039 135.1 135.1 147.5 0.05%^636 South Center Holdings, LLCand New Mansfield Brass andAluminum Co Primary MetalManufacturing Term Loan Prime plus2.75% 3/20/2039 72.6 72.6 79.7 0.03%^Cormac Enterprises andWyoming Valley BeverageIncorporated Food and BeverageStores Term Loan Prime plus2.75% 3/20/2039 103.2 103.2 113.3 0.04%^Kinisi, Inc. dba The River NorthUPS Store Administrative andSupport Services Term Loan Prime plus2.75% 3/18/2024 20.3 20.3 21.0 0.01%^SE Properties 39 Old Route 146,LLC, SmartEarly Clifton Park LLC Social Assistance Term Loan Prime plus2.75% 3/14/2039 380.7 380.7 418.0 0.15%^Tortilla King Inc. FoodManufacturing Term Loan Prime plus2.75% 3/14/2039 202.6 202.6 220.8 0.08%^Tortilla King, Inc. FoodManufacturing Term Loan Prime plus2.75% 3/14/2029 875.7 875.7 919.0 0.33%F-69See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Bowl Mor, LLC dba Bowl MorLanes / Spare Lounge, Inc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/13/2039 207.9 207.9 228.3 0.08%^Avayaan2 LLC dba Island Cove Gasoline Stations Term Loan Prime plus2.75% 3/7/2039 146.5 146.5 160.4 0.06%^R & R Boyal LLC dba Cap N CatClam Bar and Little Ease Tavern Food and BeverageStores Term Loan Prime plus2.75% 2/28/2039 387.8 387.8 423.9 0.15%^Summit Beverage Group LLC Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 2/28/2024 243.3 243.3 249.9 0.09%^Faith Memorial Chapel LLC Personal andLaundry Services Term Loan Prime plus2.75% 2/28/2039 199.2 199.2 217.5 0.08%^952 Boston Post Road Realty,LLC and HNA LLC dba StylesInternational Personal andLaundry Services Term Loan Prime plus2.75% 2/28/2039 196.0 196.0 214.0 0.08%^Choe Trade Group Inc dba RapidPrinters of Monterey Printing and RelatedSupport Activities Term Loan Prime plus2.75% 2/28/2024 110.5 110.5 114.1 0.04%^96 Mill Street LLC, Central PizzaLLC and Jason Bikakis GeorgeBikaki Food Services andDrinking Places Term Loan Prime plus2.75% 2/12/2039 131.9 131.9 144.8 0.05%^JWB Industries, Inc. dba CarteretDie Casting Primary MetalManufacturing Term Loan Prime plus2.75% 2/11/2024 194.3 194.3 198.0 0.07%^Awesome Pets II Inc dba Mellisa'sPet Depot Miscellaneous StoreRetailers Term Loan Prime plus2.75% 2/7/2024 58.4 58.4 59.6 0.02%^986 Dixwell Avenue HoldingCompany, LLC and MughaliFoods, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 2/7/2039 92.4 92.4 101.2 0.04%^Sarah Sibadan dba SibadanAgency Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 1/27/2039 119.9 119.9 131.5 0.05%^JDR Industries Inc dba CST-TheComposites Store, JetCat USA MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 1/21/2024 96.2 96.2 98.5 0.04%^Icore Enterprises Inc dba AirFlow Filters Inc MiscellaneousManufacturing Term Loan Prime plus2.75% 1/15/2024 14.9 14.9 15.4 0.01%^Carl R. Bieber, Inc. dba BieberTourways/Bieber Transportation Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/30/2027 575.7 575.7 604.3 0.22%^Nutmeg North Associates LLC(OC) Steeltech Building ProductsInc Construction ofBuildings Term Loan Prime plus2.75% 12/31/2038 848.7 848.7 925.6 0.33%^Shane M. Howell and BuckHardware and Garden Center, LLC Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 12/27/2038 299.3 299.3 326.2 0.12%^KK International TradingCorporation MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/23/2028 155.7 155.7 163.9 0.06%^Mosley Auto Group LLC dbaAmerica's Automotive Repair andMaintenance Term Loan Prime plus2.75% 12/20/2038 204.9 204.9 224.5 0.08%F-70See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Kurtis Sniezek dba Wolfe'sForeign Auto Repair andMaintenance Term Loan Prime plus2.75% 12/20/2038 82.2 82.2 90.2 0.03%^PLES Investements, LLC andJohn Redder, Pappy Sand &Gravel, Inc. Specialty TradeContractors Term Loan Prime plus2.75% 12/19/2038 513.5 513.5 560.6 0.20%^TAK Properties LLC andKinderland Inc Social Assistance Term Loan Prime plus2.75% 12/18/2038 375.1 375.1 409.8 0.15%^TOL LLC dba Wild BirdsUnlimited Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 12/13/2023 12.6 12.6 12.9 —%^920 CHR Realty LLC V.Garofalo Carting Inc Waste Managementand RemediationServices Term Loan Prime plus2.75% 12/10/2038 387.3 387.3 424.9 0.15%^DKB Transport Corp TruckTransportation Term Loan Prime plus2.75% 12/5/2038 128.3 128.3 140.8 0.05%^Firm Foundations Inc David SGaitan Jr and Christopher KDaigle Specialty TradeContractors Term Loan Prime plus2.75% 12/3/2038 96.4 96.4 104.8 0.04%^Spectrum Development LLC andSolvit Inc & Solvit North, Inc Specialty TradeContractors Term Loan Prime plus2.75% 12/2/2023 267.3 267.3 273.5 0.10%^BVIP Limousine Service LTD Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 11/27/2038 70.6 70.6 77.3 0.03%^Eco-Green Reprocessing LLCand Denali Medical Concepts,LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 11/27/2023 45.1 45.1 45.8 0.02%^Wallace Holdings LLC, GFAInternational Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.5% 11/25/2023 83.5 83.5 84.3 0.03%^AcuCall LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/21/2023 10.4 10.4 10.5 —%^Kids in Motion of SpringfieldLLC dba The Little Gym ofSpringfield IL Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 11/18/2023 30.8 30.8 31.3 0.01%^Yousef Khatib dba Y&MEnterprises WholesaleElectronic Marketsand Agents andBrokers Term Loan Prime plus2.75% 11/15/2023 50.3 50.3 51.2 0.02%^Howell Gun Works LLC Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 11/14/2023 3.8 3.8 3.8 —%^Polpo Realty, LLC, PolpoRestaurant, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/6/2038 57.5 57.5 63.1 0.02%^Twinsburg Hospitality GroupLLC dba Comfort Suites Accommodation Term Loan Prime plus2.75% 10/31/2038 874.3 874.3 954.3 0.34%^Mid-Land Sheet Metal Inc Specialty TradeContractors Term Loan Prime plus2.75% 10/31/2038 126.9 126.9 138.9 0.05%F-71See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Master CNC Inc & MasterProperties LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 10/31/2038 549.6 549.6 598.2 0.21%^Janice B. McShan and TheMetropolitan Day School, LLC Social Assistance Term Loan Prime plus2.75% 10/31/2023 29.1 29.1 30.0 0.01%^1 North Restaurant Corp dba 1North Steakhouse Food Services andDrinking Places Term Loan Prime plus2.75% 10/31/2038 195.8 195.8 214.5 0.08%^New Image Building ServicesInc. dba New Image RepairServices Repair andMaintenance Term Loan Prime plus2.75% 10/29/2023 219.5 219.5 223.8 0.08%^Greenbrier Technical Services,Inc Repair andMaintenance Term Loan Prime plus2.75% 10/24/2023 145.0 145.0 149.5 0.05%^Clairvoyant Realty Corp. andNapoli Marble & Granite Design,Ltd Specialty TradeContractors Term Loan Prime plus2.75% 10/24/2038 226.8 226.8 247.3 0.09%^Kelly Auto Care LLC dbaShoreline Quick Lube and CarWash Repair andMaintenance Term Loan Prime plus2.75% 10/18/2023 58.0 58.0 59.1 0.02%^First Steps Real Estate Company,LLC and First Steps Preschool Social Assistance Term Loan Prime plus2.75% 9/30/2038 89.7 89.7 97.6 0.04%^Lenoir Business Partners LLC, LPIndustries, Inc dba Childforms Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 9/30/2038 271.6 271.6 297.2 0.11%^Top Properties LLC and LPIndustries, Inc dba Childforms Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 9/30/2038 110.6 110.6 121.2 0.04%^Discount Wheel and Tire Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 9/30/2038 205.6 205.6 224.3 0.08%^Cencon Properties LLC andCentral Connecticut WarehousingCompany, Inc Warehousing andStorage Term Loan Prime plus2.75% 9/30/2038 317.0 317.0 347.5 0.12%^Mitchellville Family Dentistry,Dr. Octavia Simkins-WisemanDDS PC Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/27/2038 307.8 307.8 336.3 0.12%^Gabrielle Realty, LLC Gasoline Stations Term Loan Prime plus2.75% 9/27/2038 696.0 696.0 759.1 0.27%^Anthony C Dinoto and Susan S PDinoto and Anthony C DinotoFuneral Home Personal andLaundry Services Term Loan Prime plus2.75% 9/26/2038 91.9 91.9 100.7 0.04%^Eastside Soccer Dome, Inc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/26/2038 426.0 426.0 467.0 0.17%^HJ & Edward Enterprises, LLCdba Sky Zone Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/26/2023 177.5 177.5 182.3 0.07%^Southeast Chicago Soccer, Inc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/26/2038 47.1 47.1 51.6 0.02%^Kiddie Steps 4 You Inc. Social Assistance Term Loan Prime plus2.75% 9/25/2038 83.0 83.0 90.4 0.03%F-72See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Diamond Memorials Incorporated Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/25/2023 8.1 8.1 8.2 —%^Serious-Fun in Alpharetta, LLCdba The Little Gym of Alpharetta EducationalServices Term Loan Prime plus2.75% 9/20/2023 30.5 30.5 31.0 0.01%^Faith Memorial Chapel LLC Personal andLaundry Services Term Loan Prime plus2.75% 9/20/2038 246.9 246.9 269.8 0.10%^Westville Seafood LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/19/2038 103.2 103.2 112.6 0.04%^Maynard Enterprises Inc dbaFastsigns of Texarkana Miscellaneous StoreRetailers Term Loan Prime plus2.75% 9/18/2023 10.6 10.6 10.8 —%^Grafio Inc dba Omega LearningCenter-Acworth EducationalServices Term Loan Prime plus2.75% 9/13/2023 108.7 108.7 110.6 0.04%^Sound Manufacturing Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/12/2028 44.2 44.2 46.3 0.02%^The Berlerro Group, LLC dbaSky Zone Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/12/2023 285.1 285.1 289.9 0.10%^Prospect Kids Academy Inc EducationalServices Term Loan Prime plus2.75% 9/11/2038 114.2 114.2 124.8 0.04%^Alma J. and William R. Waltonand Almas Child Day Care Center Social Assistance Term Loan Prime plus2.75% 9/11/2038 36.3 36.3 39.8 0.01%^B for Brunette dba Blo Personal andLaundry Services Term Loan Prime plus2.75% 9/10/2023 35.4 35.4 35.9 0.01%^Schmaltz Holdings, LLC andSchmaltz Operations, LLC dbaCompanio Personal andLaundry Services Term Loan Prime plus2.75% 9/4/2038 204.7 204.7 223.3 0.08%^Excel RP Inc MachineryManufacturing Term Loan Prime plus2.75% 8/30/2023 84.3 84.3 86.8 0.03%^IlOKA Inc dba Microtech Tel andNewCloud Networks Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/30/2023 445.0 445.0 454.0 0.16%^ACI Northwest Inc. Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 8/30/2023 396.6 396.6 408.4 0.15%^Gulfport Academy Child Careand Learning Center, Inc. andJennifer Sis Social Assistance Term Loan Prime plus2.75% 8/30/2023 28.0 28.0 28.8 0.01%^Ramard Inc and Advanced HealthSciences Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 8/28/2023 121.4 121.4 122.8 0.04%^RM Hawkins LLC dba Pure WaterTech West and Robert M Hawkins Nonstore Retailers Term Loan Prime plus2.75% 8/26/2023 52.4 52.4 54.0 0.02%^JSIL LLC dba BlackstonesHairdressing Personal andLaundry Services Term Loan Prime plus2.75% 8/16/2023 12.5 12.5 12.7 —%F-73See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Island Nautical Enterprises, Inc.and Ingwall Holdings, LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 8/14/2038 317.9 317.9 346.2 0.12%^Caribbean Concepts, Inc. dbaQuick Bleach Ambulatory HealthCare Services Term Loan Prime plus2.75% 8/12/2023 14.6 14.6 14.8 0.01%^Majestic Contracting Services,Inc. dba Majestic Electric andMajestic Specialty TradeContractors Term Loan Prime plus2.75% 7/26/2038 173.9 173.9 189.5 0.07%^Daniel W and Erin H Gordon andSilver Lining Stables CT, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 7/24/2023 7.6 7.6 7.8 —%^Angkor Restaurant Inc Food Services andDrinking Places Term Loan Prime plus2.75% 7/19/2038 85.2 85.2 93.3 0.03%^Harbor Ventilation Inc and EstesInvestment, LLC Specialty TradeContractors Term Loan Prime plus2.75% 7/19/2038 2.2 2.2 2.4 —%^Tri County Heating and CoolingInc. Specialty TradeContractors Term Loan Prime plus2.75% 7/19/2023 56.1 56.1 57.8 0.02%^Morning Star Trucking LLC andMorning Star Equipment andLeasing LLC TruckTransportation Term Loan Prime plus2.75% 7/17/2023 34.4 34.4 34.8 0.01%^Maxiflex LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 6/28/2023 28.6 28.6 29.5 0.01%^GIA Realty LLC and VRAJ GIALLC dba Lakeview Laundromat Personal andLaundry Services Term Loan Prime plus2.75% 6/28/2038 89.1 89.1 98.1 0.04%^JRA Holdings LLC, JasperCounty Cleaners Inc dba SuperiorCleaner Personal andLaundry Services Term Loan Prime plus2.75% 6/28/2038 109.0 109.0 120.1 0.04%^2161 Highway 6 Trail, LLC, R.H. Hummer JR., Inc. TruckTransportation Term Loan Prime plus2.75% 6/19/2026 665.4 665.4 697.0 0.25%^Blakeslee Arpaia Chapman, Inc.dba Blakeslee Industrial Services Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 6/18/2028 693.9 693.9 733.7 0.26%^KDP LLC and KDP InvestmentAdvisors, Inc and KDP AssetManagement, Inc Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 6/14/2023 217.1 217.1 222.8 0.08%^Elite Structures Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 6/12/2038 830.6 830.6 915.1 0.33%^Willowbrook Properties LLC,Grove Gardens Landscaping Inc. Administrative andSupport Services Term Loan Prime plus2.75% 6/5/2038 170.1 170.1 187.3 0.07%^(EPC) Absolute Desire LLC andMark H. Szierer, SophisticatedSmile Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/5/2038 172.3 172.3 189.4 0.07%^RXSB, Inc dba Medicine Shoppe Health and PersonalCare Stores Term Loan Prime plus2.75% 5/30/2023 116.1 116.1 119.1 0.04%^Gregory P Jellenek OD andAssociates PC dba Gregory PJellenek OD Ambulatory HealthCare Services Term Loan Prime plus2.75% 5/28/2023 39.3 39.3 40.5 0.01%F-74See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Ryan D. Thornton and Thornton& Associates LLC Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 5/24/2023 30.7 30.7 31.5 0.01%^PowerWash Plus, Inc. and CJR,LLC Repair andMaintenance Term Loan Prime plus2.75% 4/30/2038 500.9 500.9 550.9 0.20%^Peanut Butter & Co., Inc. Food Manufacturing Term Loan Prime plus2.75% 4/30/2023 61.2 61.2 62.8 0.02%^Brothers International Desserts Food Manufacturing Term Loan Prime plus2.75% 4/26/2023 141.6 141.6 145.8 0.05%^Kidrose, LLC dba KidvilleRiverdale Educational Services Term Loan Prime plus2.75% 4/22/2023 49.0 49.0 50.4 0.02%^1258 Hartford TPKE, LLC andPhelps and Sons, Inc Miscellaneous StoreRetailers Term Loan Prime plus2.75% 3/29/2038 113.1 113.1 124.2 0.04%^Capital Scrap Metal, LLC andPowerline Investment, LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 3/29/2038 432.5 432.5 476.1 0.17%^MRM Supermarkets Inc dbaConstantins Breads; DallasGourmet Breads Food Manufacturing Term Loan Prime plus2.75% 3/29/2038 305.5 305.5 335.3 0.12%^Xela Pack, Inc. and Aliseo andCatherine Gentile PaperManufacturing Term Loan Prime plus2.75% 3/27/2028 211.9 211.9 223.8 0.08%^A & M Commerce, Inc. dbaCranberry Sunoco Gasoline Stations Term Loan Prime plus2.75% 3/27/2038 299.6 299.6 329.5 0.12%^American Diagnostic Imaging,Inc. dba St. Joseph Imaging Center Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/25/2038 487.8 487.8 536.0 0.19%^Michael A.and HeatherR. Welschdba Art & FrameEtc. Miscellaneous StoreRetailers Term Loan Prime plus2.75% 3/22/2038 61.3 61.3 67.4 0.02%^M & H Pine Straw Inc and HarrisL. Maloy MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 3/21/2023 198.8 198.8 204.6 0.07%^Truth Technologies Inc dbaTruth Technologies Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/21/2023 48.3 48.3 49.5 0.02%^J. Kinderman & Sons Inc., dbaBriteStar Inc. ElectricalEquipment,Appliance, andComponentManufacturing Term Loan Prime plus2.75% 3/20/2023 112.1 112.1 115.5 0.04%^Stellar Environmental LLC Waste Managementand RemediationServices Term Loan Prime plus2.75% 3/18/2023 34.2 34.2 35.2 0.01%^Sound Manufacturing, Inc. andMonster Power Equipment Inc. Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 3/15/2023 316.1 316.1 325.1 0.12%^Golden Gate Lodging LLC Accommodation Term Loan Prime plus2.75% 3/12/2038 104.4 104.4 114.8 0.04%^River Club Golf Course Inc dbaThe River Club Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 2/28/2038 432.8 432.8 475.8 0.17%F-75See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Bakhtar Group LLC dbaMalmaison Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2023 62.7 62.7 64.3 0.02%^Osceola River Mill, LLC,Ironman Machine, Inc. MachineryManufacturing Term Loan Prime plus2.75% 2/20/2038 78.1 78.1 85.9 0.03%^Java Warung, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 2/19/2038 46.3 46.3 50.9 0.02%^Retain Loyalty LLC Printing and RelatedSupport Activities Term Loan Prime plus2.75% 2/15/2038 96.2 96.2 105.9 0.04%^Outcome Driven Innovation, Inc.dba ODI MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 2/12/2023 50.2 50.2 51.5 0.02%^Knits R Us, Inc. dba NYC Sports /Mingle Textile Mills Term Loan Prime plus2.75% 2/11/2038 113.4 113.4 124.8 0.04%^North Country Transport, LLC Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 2/6/2023 9.0 9.0 9.3 —%^MJD Investments, LLC dba TheCommunity Day School Social Assistance Term Loan Prime plus2.75% 1/31/2038 233.4 233.4 256.5 0.09%^Sherill Universal City dba GoldenCorral Food Services andDrinking Places Term Loan Prime plus2.75% 1/28/2038 399.7 399.7 439.3 0.16%^Macho LLC, MadelaineChocolate Novelties Inc Food Manufacturing Term Loan Prime plus2.75% 12/31/2037 453.3 453.3 498.5 0.18%^Elegant Fireplace Mantels, Inc.dba Elegant Fireplace Mantels Specialty TradeContractors Term Loan Prime plus2.75% 12/31/2022 56.9 56.9 58.3 0.02%^Babie Bunnie Enterprises Inc dbaTriangle Mothercare Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/28/2027 32.2 32.2 33.8 0.01%^John Duffy Fuel Co., Inc. MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/28/2022 300.0 300.0 308.6 0.11%^Polpo Realty LLC & PolpoRestaurant LLC dba PolpoRestaurant Food Services andDrinking Places Term Loan Prime plus2.75% 12/27/2037 467.1 467.1 513.6 0.18%^Martin L Hopp, MD PHD AMedical Corp dba Tower ENT Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/21/2022 38.5 38.5 39.5 0.01%^Ezzo Properties, LLC and GreatLakes Cleaning, Inc. Administrative andSupport Services Term Loan Prime plus2.75% 12/20/2027 298.5 298.5 313.7 0.11%^Pioneer Window Holdings, Incand Subsidiaries dba PioneerWindows Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 12/20/2022 130.7 130.7 134.1 0.05%^Cheryle A Baptiste and CheryleBaptiste DDS PLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/30/2037 259.0 259.0 284.7 0.10%^Daniel Gordon and Erin Gordonand Silver Lining Stables CT, LLC Support Activitiesfor Agriculture andForestry Term Loan Prime plus2.75% 11/28/2037 204.2 204.2 224.5 0.08%^D&L Rescources, Inc. dba TheUPS Store Miscellaneous StoreRetailers Term Loan Prime plus2.75% 11/27/2022 5.6 5.6 5.7 —%F-76See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Richmond Hill Mini Market, LLC Food and BeverageStores Term Loan Prime plus2.75% 11/27/2037 166.8 166.8 183.3 0.07%^DRV Enterprise, Inc. dba Cici'sPizza # 339 Food Services andDrinking Places Term Loan Prime plus2.75% 11/26/2022 34.8 34.8 35.8 0.01%^U & A Food and Fuel, Inc. dbaExpress Gas & Food Mart Gasoline Stations Term Loan Prime plus2.75% 11/21/2037 86.6 86.6 95.3 0.03%^Pioneer Windows ManufacturingCorp, Pioneer Windows Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 11/21/2022 157.5 157.5 161.6 0.06%^R & J Petroleum LLC, ManarUSA, Inc. Gasoline Stations Term Loan Prime plus2.75% 11/20/2037 162.0 162.0 178.0 0.06%^St Judes Physical Therapy P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/19/2022 12.1 12.1 12.5 —%^Hi-Def Imaging, Inc. dbaSpeedPro Imaging Printing and RelatedSupport Activities Term Loan Prime plus2.75% 11/9/2022 12.8 12.8 13.1 —%^Reidville Hydraulics Mfg Inc dbaSummit MachineryManufacturing Term Loan Prime plus2.75% 11/2/2037 239.2 239.2 262.3 0.09%^Big Apple Entertainment Partners,LLC d/b/a Ripley's Believe It orNot Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/26/2022 104.5 104.5 106.9 0.04%^LA Diner Inc dba Loukas L ADiner Food Services andDrinking Places Term Loan Prime plus2.75% 9/28/2037 617.8 617.8 678.8 0.24%^University Park Retreat, LLC dbaMassage Heights Personal andLaundry Services Term Loan Prime plus2.75% 9/27/2022 42.4 42.4 43.6 0.02%^Forno Italiano Di NonnaRandazzo, LLC dba NonnaRandazzo's Bakery Food and BeverageStores Term Loan Prime plus2.75% 9/26/2037 165.9 165.9 182.0 0.07%^LaSalle Market and Deli EOK Incand Rugen Realty LLC dba LaSalleMark Food Services andDrinking Places Term Loan Prime plus2.75% 9/21/2037 226.0 226.0 247.9 0.09%^O'Rourkes Diner LLC dbaO'Rourke's Diner Food Services andDrinking Places Term Loan Prime plus2.75% 9/19/2037 58.7 58.7 64.3 0.02%^AJK Enterprise LLC dba AJKEnterprise LLC TruckTransportation Term Loan Prime plus2.75% 8/27/2022 9.0 9.0 9.3 —%^New Image Building Services,Inc. dba New Image RepairServices Repair andMaintenance Term Loan Prime plus2.75% 8/23/2037 255.4 255.4 279.8 0.10%^Suncoast Aluminum Furniture,Inc Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 8/17/2037 322.0 322.0 353.8 0.13%^Hofgard & Co., Inc. dbaHofgardBenefits Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 7/27/2022 57.1 57.1 58.7 0.02%^Georgia Safe Sidewalks LLC Specialty TradeContractors Term Loan Prime plus2.75% 7/27/2022 8.0 8.0 8.2 —%^Central Tire, Inc. dba Cooper Tire& Auto Services Repair andMaintenance Term Loan Prime plus2.75% 6/29/2037 256.5 256.5 282.2 0.10%F-77See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^WPI, LLC TransportationEquipmentManufacturing Term Loan Prime plus2.75% 6/29/2024 82.4 82.4 85.4 0.03%^Havana Central (NY) 5, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/29/2022 736.2 736.2 756.2 0.27%^Jenkins-Pavia Corporation dbaVictory Lane Quick Oil Change Repair andMaintenance Term Loan Prime plus2.75% 6/27/2037 62.0 62.0 68.2 0.02%^KIND-ER-ZZ Inc dba Kidville EducationalServices Term Loan Prime plus2.75% 6/15/2022 26.4 26.4 27.1 0.01%^Graphish Studio, Inc. and ScottFishoff Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/14/2022 10.7 10.7 11.0 —%^ALF, LLC, Mulit-Service EagleTires Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 5/31/2037 55.9 55.9 61.5 0.02%^Craig R Freehauf dba LincolnTheatre Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 5/31/2022 16.0 16.0 16.5 0.01%^Christou Real Estate HoldingsLLC dba Tops American Grill Food Services andDrinking Places Term Loan Prime plus2.75% 5/17/2037 251.6 251.6 277.0 0.10%^Tracey Vita-Morris dba TraceyVita's School of Dance Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 5/10/2022 11.8 11.8 12.1 —%^Bisson Transportation, Inc. TruckTransportation Term Loan Prime plus2.75% 5/7/2037 550.0 550.0 604.8 0.22%^Bisson Moving & StorageCompany Bisson TransportationInc TruckTransportation Term Loan Prime plus2.75% 5/7/2022 319.5 319.5 328.2 0.12%^Fair Deal Food Mart Inc dbaNeighbors Market Gasoline Stations Term Loan Prime plus2.75% 5/3/2037 338.2 338.2 372.3 0.13%^Tanner Optical, Inc. dbaMurphy Eye Care Ambulatory HealthCare Services Term Loan Prime plus2.75% 4/27/2022 4.2 4.2 4.3 —%^Zane Filippone Co Inc dbaCulligan Water Conditioning Nonstore Retailers Term Loan Prime plus2.75% 4/12/2022 288.3 288.3 296.0 0.11%^Indoor Playgrounds LimitedLiability Company dba Kidville EducationalServices Term Loan Prime plus2.75% 4/5/2022 5.1 5.1 5.2 —%^Access Staffing, LLC Administrative andSupport Services Term Loan Prime plus2.75% 3/30/2022 95.2 95.2 97.4 0.03%^Brandywine Picnic Park, Inc.and B.Ross Capps & Linda Capps Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/30/2031 187.0 187.0 200.7 0.07%^Willow Springs Golf Course,Inc. & JC Lindsey Family LimitedPartners Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/29/2037 669.6 669.6 736.4 0.26%^DC Realty, LLC dba FOGO DataCenters Professional,Scientific, andTechnical Services Term Loan 6% 3/23/2037 2,623.4 2,623.4 2,885.4 1.04%F-78See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^DC Realty, LLC dba FOGO DataCenters Professional,Scientific, andTechnical Services Term Loan 6.25% 3/23/2022 734.2 734.2 753.2 0.27%^Manuel P. Barrera and AccuraElectrical Contractor, Inc. Specialty TradeContractors Term Loan Prime plus2.75% 3/23/2028 77.5 77.5 81.8 0.03%^Shweiki Media, Inc. dba StudyBreaks Magazine PublishingIndustries (exceptInternet) Term Loan Prime plus2.75% 3/22/2027 852.3 852.3 896.6 0.32%^ATI Jet, Inc. Air Transportation Term Loan Prime plus2.75% 12/28/2026 596.3 596.3 626.7 0.23%^J. Kinderman & Sons, Inc. dbaBrite Star Manufacturing Company Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 12/22/2036 440.1 440.1 483.6 0.17%^K's Salon, LLC dba K's Salon Personal andLaundry Services Term Loan Prime plus2.75% 12/20/2021 35.5 35.5 36.3 0.01%^15 Frederick Place LLC &Pioneer Windows Holdings Inc &Subs Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 12/16/2021 118.7 118.7 121.5 0.04%^M & H Pinestraw, Inc. and HarrisL. Maloy MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/15/2021 135.5 135.5 138.7 0.05%^Taylor Transport, Inc TruckTransportation Term Loan Prime plus2.75% 12/8/2021 148.7 148.7 152.3 0.05%^MRM Supermarkets, Inc. dbaConstantin's Breads FoodManufacturing Term Loan Prime plus2.75% 11/10/2021 65.0 65.0 66.5 0.02%^K9 Bytes, Inc & Epazz, Inc dbaK9 Bytes, Inc PublishingIndustries (exceptInternet) Term Loan Prime plus2.75% 10/26/2021 27.6 27.6 28.2 0.01%^28 Cornelia Street Properties,LLC and Zouk, Ltd. Food Services andDrinking Places Term Loan Prime plus2.75% 10/25/2021 10.4 10.4 10.6 —%^39581 Garfield, LLC and TriCounty Neurological Associates,P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/30/2036 72.3 72.3 79.3 0.03%^Robert E. Caves, Sr. andAmerican Plank dba CavesEnterprises MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/30/2021 137.7 137.7 140.8 0.05%^39581 Garfield, LLC andTricounty Neurological Associates,P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/30/2036 24.6 24.6 27.0 0.01%^PTK, Incorporated dba Night NDay 24 HR Convenience Store Food and BeverageStores Term Loan Prime plus2.75% 9/30/2036 119.7 119.7 131.4 0.05%^Big Apple Entertainment Partners,LLC dba Ripley's Believe it or Not Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/28/2021 479.9 479.9 489.7 0.18%^Equity National Capital LLC &Chadbourne Road Capital, LLC Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 9/26/2021 28.5 28.5 29.1 0.01%F-79See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Bryan Bantry Inc. Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 9/8/2021 38.0 38.0 38.8 0.01%^Michael S. Decker & JanetDecker dba The Hen House Cafe Food Services andDrinking Places Term Loan Prime plus2.75% 8/30/2036 14.3 14.3 15.7 0.01%^Qycell Corporation Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 8/19/2021 79.1 79.1 80.8 0.03%^Trademark Equipment CompanyInc and David A. Daniel Miscellaneous StoreRetailers Term Loan Prime plus2.75% 8/19/2036 116.0 116.0 127.3 0.05%^Valiev Ballet Academy, Inc Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 8/12/2036 36.8 36.8 40.4 0.01%^A & A Auto Care, LLC dba A &A Auto Care, LLC Repair andMaintenance Term Loan Prime plus2.75% 8/12/2036 88.0 88.0 96.6 0.03%^LaHoBa, LLC d/b/a Papa John's Food Services andDrinking Places Term Loan Prime plus2.75% 8/3/2036 66.8 66.8 73.4 0.03%^MTV Bowl, Inc. dba LegendLanes Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/30/2036 217.9 217.9 239.5 0.09%^Lavertue Properties LLP dbaLavertue Properties Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 6/29/2036 38.8 38.8 42.7 0.02%^Lisle Lincoln II LimitedPartnership dba Lisle Lanes LP Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/29/2036 303.8 303.8 333.9 0.12%^Pierce Developments, Inc. dbaSouthside Granite MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 6/13/2036 221.2 221.2 243.0 0.09%^Major Queens Body & FenderCorp Repair andMaintenance Term Loan Prime plus2.75% 6/10/2021 12.2 12.2 12.5 —%^J&K Fitness, LLC dba PhysiquesWomens Fitness Center Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/8/2036 398.3 398.3 437.7 0.16%^Peanut Butter & Co., Inc. d/b/aPeanut Butter & Co. MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 6/3/2021 26.9 26.9 27.5 0.01%^Demand Printing Solutions,Inc.and MLM Enterprises, LLC Printing and RelatedSupport Activities Term Loan Prime plus2.75% 5/27/2021 6.9 6.9 7.0 —%^Modern on the Mile, LLC dbaLigne Roset Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 5/25/2021 87.9 87.9 89.8 0.03%^Profile Performance, Inc. andEidak Real Estate, L.L.C. Repair andMaintenance Term Loan Prime plus2.75% 4/20/2036 109.6 109.6 120.5 0.04%F-80See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Northwind Outdoor Recreation,Inc. dba Red Rock WildernessStore Nonstore Retailers Term Loan Prime plus2.75% 4/18/2036 113.8 113.8 125.1 0.04%^Michael S. Korfe dba NorthValley Auto Repair Repair andMaintenance Term Loan Prime plus2.75% 3/24/2036 13.3 13.3 14.6 0.01%^Actknowledge,Inc dbaActknowledge Personal andLaundry Services Term Loan Prime plus2.75% 3/21/2021 23.0 23.0 23.5 0.01%^Key Products I&II, Inc. dbaDunkin' Donuts/Baskin-Robbins Food and BeverageStores Term Loan Prime plus2.75% 3/10/2021 61.5 61.5 62.8 0.02%^Stephen Frank, Patricia Frankand Suds Express LLC dba FrankChiropra Ambulatory HealthCare Services Term Loan Prime plus2.75% 2/25/2023 31.3 31.3 32.3 0.01%^SuzyQue’s LLC dba Suzy Que’s Food Services andDrinking Places Term Loan Prime plus2.75% 2/11/2036 52.3 52.3 57.5 0.02%^Little People’s Village, LLC dbaLittle People’s Village Social Assistance Term Loan Prime plus2.75% 1/31/2036 26.5 26.5 29.1 0.01%^Seagate Group Holdings, Inc.dba Seagate Logistics, Inc. Support Activitiesfor Transportation Term Loan Prime plus2.75% 1/28/2036 96.7 96.7 106.2 0.04%^Patrageous Enterprises, LLC dbaIncredibly Edible Delites of Laurel Food and BeverageStores Term Loan Prime plus2.75% 12/29/2020 2.7 2.7 2.8 —%^Dixie Transport, Inc. & JohnnyD. Brown & Jimmy Brown &Maudain Brown Support Activitiesfor Transportation Term Loan 5.25% 12/28/2035 1,316.8 1,334.6 1,444.1 0.52%^Groundworks Unlimited LLC Specialty TradeContractors Term Loan 6% 12/17/2023 72.8 72.8 75.4 0.03%^Shree OM Lodging, LLC dbaRoyal Inn Accommodation Term Loan Prime plus2.75% 12/17/2035 23.5 23.5 25.8 0.01%^Lodin Medical Imaging, LLCdba Watson Imaging Center Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/1/2020 24.4 24.4 24.8 0.01%^Robert F. Schuler and Lori A.Schuler dba Bob’s Service Center Repair andMaintenance Term Loan Prime plus2.75% 11/30/2035 28.8 28.8 31.6 0.01%^West Cobb Enterprises, Inc andAdvanced Eye Associates, L.L.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/12/2035 126.3 126.3 138.5 0.05%^K9 Bytes, Inc & Epazz, Inc PublishingIndustries (exceptInternet) Term Loan Prime plus2.75% 9/30/2020 6.4 6.4 6.5 —%^Elan Realty, LLC and AlbertBasse Asociates, Inc. Printing and RelatedSupport Activities Term Loan Prime plus2.75% 9/30/2035 192.6 192.6 211.1 0.08%^Success Express,Inc. dba SuccessExpress Couriers andMessengers Term Loan Prime plus2.75% 9/29/2020 30.5 30.5 31.0 0.01%^Modern Manhattan, LLC Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 9/20/2020 70.6 70.6 71.9 0.03%^Dirk's Trucking, L.L.C. dbaDirk's Trucking TruckTransportation Term Loan Prime plus2.75% 9/17/2020 6.0 6.0 6.1 —%^Rudy & Louise Chavez dbaClyde's Auto and FurnitureUpholstery Repair andMaintenance Term Loan Prime plus2.75% 9/2/2035 42.2 42.2 46.2 0.02%F-81See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Newsome Trucking Inc andKevin Newsome TruckTransportation Term Loan Prime plus2.75% 9/2/2035 206.1 206.1 225.8 0.08%^California College ofCommunications, Inc. EducationalServices Term Loan Prime plus2.75% 11/2/2020 61.3 61.3 62.5 0.02%^DDLK Investments LLC dbaSmoothie King Food Services andDrinking Places Term Loan Prime plus2.75% 8/30/2020 1.6 1.6 1.6 —%^Members Only Software Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/30/2020 13.2 13.2 13.4 —%^ActKnowledge,Inc dbaActKnowledge Personal andLaundry Services Term Loan Prime plus2.75% 6/30/2020 15.9 15.9 16.2 0.01%^I-90 RV & Auto Supercenter Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 6/29/2035 62.7 62.7 68.6 0.02%^Zouk, Ltd. dba Palma Food Services andDrinking Places Term Loan Prime plus2.75% 8/25/2020 9.1 9.1 9.3 —%^CJ Park Inc. dba KidvilleMidtown West EducationalServices Term Loan Prime plus2.75% 6/25/2020 6.6 6.6 6.7 —%^Tanner Optical Inc. dba MurphyEye Care Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/22/2035 79.3 79.3 86.8 0.03%^B&B Fitness and Barbell, Inc. dbaElevations Health Club Amusement,Gambling, andRecreationIndustries Term Loan 6% 6/22/2035 182.0 182.0 199.2 0.07%^M & H Pine Straw, Inc.and HarrisMaloy Support Activitiesfor Agriculture andForestry Term Loan Prime plus2.75% 7/10/2020 28.2 28.2 28.7 0.01%^Excel RP, Inc./Kevin and JoannFoley MachineryManufacturing Term Loan Prime plus2.75% 7/8/2028 35.7 35.7 37.9 0.01%ValleyStar, Inc. dba BrightStarHealthCare Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/28/2020 1.9 1.9 1.9 —%^ValleyStar, Inc. dba BrightStarHealthcare Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/28/2020 2.4 2.4 2.4 —%^Diag, LLC dba Kidville EducationalServices Term Loan Prime plus2.75% 6/21/2020 11.5 11.5 11.7 —%^M & H Pine Straw, Inc and HarrisL. Maloy Support Activitiesfor Agriculture andForestry Term Loan 6% 4/30/2020 57.0 57.0 58.0 0.02%^New Economic Methods LLC dbaRita's Food Services andDrinking Places Term Loan Prime plus2.75% 7/15/2020 0.5 0.5 0.6 —%^Cocoa Beach Parasail Corp. dbaCocoa Beach Parasail Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/26/2020 1.8 1.8 1.9 —%^Lahoba,LLC dba Papa John'sPizza Food Services andDrinking Places Term Loan Prime plus2.75% 12/30/2034 35.2 35.2 38.4 0.01%F-82See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Animal Intrusion PreventionSystems Holding Company, LLC Administrative andSupport Services Term Loan Prime plus2.75% 3/29/2024 25.8 25.8 26.8 0.01%^David A. Nusblatt, D.M.D, P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/11/2019 2.3 2.3 2.3 —%^CMA Consulting dbaConstruction ManagementAssociates Construction ofBuildings Term Loan Prime plus2.75% 12/11/2019 13.4 13.4 13.5 —%^KMC RE, LLC & B&B Kennels Personal andLaundry Services Term Loan Prime plus2.75% 11/19/2034 48.0 48.0 52.5 0.02%^Demand Printing Solutions, Inc. Printing and RelatedSupport Activities Term Loan Prime plus2.75% 12/12/2019 2.5 2.5 2.5 —%^Demand Printing Solutions, Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 10/29/2034 121.1 121.1 132.3 0.05%^Rover Repairs Repair andMaintenance Term Loan Prime plus2.5% 11/28/2029 51.4 35.9 54.2 0.02%^Supreme Screw Products Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 4/17/2019 51.5 51.5 52.1 0.02%^Gray Tree Service, Inc. Administrative andSupport Services Term Loan Prime plus2.75% 12/18/2018 6.4 6.4 6.5 —%^Gourmet to You, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2019 1.7 1.7 1.8 —%^The Alba Financial Group, Inc. Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan 6% 1/10/2019 9.6 9.6 9.7 —%^Inflate World Corporation Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/30/2018 0.6 0.6 0.6 —%^Peter Thomas Roth Labs MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/26/2018 41.1 41.1 41.4 0.01%^CBA D&A Pope, LLC dbaChristian Brothers Automotive Repair andMaintenance Term Loan Prime plus2.75% 6/14/2018 11.0 11.0 11.0 —%^Gilbert Chiropractic Clinic, Inc. Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/7/2018 0.3 0.3 0.3 —%^D & D's Divine Beauty School ofEsther, LLC Educational Services Term Loan 6% 8/1/2031 49.0 49.0 52.8 0.02%Bliss Coffee and Wine Bar, LLC Food Services andDrinking Places Term Loan 6% 8/31/2019 68.1 68.1 68.9 0.02%^Zog Inc. Other InformationServices Term Loan 6% 3/17/2018 48.2 48.2 48.4 0.02%^Saan M.Saelee dba Saelee'sDelivery Service TruckTransportation Term Loan Prime plus2.75% 3/12/2018 0.3 0.3 0.3 —%F-83See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Integrity Sports Group, LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan 6% 3/6/2018 30.6 30.6 30.7 0.01%^Enewhere Custom Canvas, LLC Textile ProductMills Term Loan Prime plus2.75% 2/15/2018 0.5 0.5 0.5 —%^A & A Acquisition, Inc. dba A &A International Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 2/15/2018 2.2 2.2 2.2 —%^All American Printing Printing and RelatedSupport Activities Term Loan Prime plus2.75% 10/26/2032 36.4 36.4 39.5 0.01%^Seo's Paradise Cleaners, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 1/19/2018 0.1 0.1 0.1 —%^Connect Litigation Technology,Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus 2% 10/18/2025 25.2 17.6 25.7 0.01%^1911 East Main Street Holdings,Corp Repair andMaintenance Term Loan Prime plus2.75% 5/18/2032 11.9 11.9 12.8 —%^Water Works Laundromat, LLC Personal andLaundry Services Term Loan Prime plus2.25% 9/7/2027 170.4 170.4 176.3 0.06%^Dave Kris, and MDK Ram Corp. Food and BeverageStores Term Loan Prime plus2.75% 2/5/2026 29.6 29.6 31.0 0.01%^Gill Express Inc. dba AmericanEagle Truck Wash Repair andMaintenance Term Loan Prime plus2.75% 1/5/2027 173.9 173.9 183.4 0.07%^Smooth Grounds, Inc. Food Services andDrinking Places Term Loan 7.75% 12/31/2018 27.5 27.5 27.7 0.01%^Fran-Car Corporation dbaHorizon Landscape Management Administrative andSupport Services Term Loan Prime plus2.75% 3/3/2028 65.4 65.4 69.3 0.02%^Head To Toe PersonalizedPampering, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 1/27/2031 8.6 8.6 9.2 —%^Christopher F. Bohon & PamelaD. Bohon Social Assistance Term Loan Prime plus2.75% 10/28/2026 3.0 3.0 3.2 —%^Mogas Limited Gasoline Stations Term Loan Prime plus2.75% 5/31/2030 69.6 48.7 74.5 0.03%^Shree Om Lodging, LLC dbaRoyal Inn Accommodation Term Loan Prime plus2.75% 5/2/2030 61.5 61.5 65.9 0.02%^Pedzik's Pets, LLC Support Activitiesfor Agriculture andForestry Term Loan Prime plus2.75% 3/31/2030 8.5 8.5 9.1 —%^Nancy Carapelluci & A & MSeasonal Corner Inc. Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 3/1/2025 13.1 13.1 13.7 —%^Patricia Hughes Jones, MD PC Ambulatory HealthCare Services Term Loan Prime plus2.75% 1/13/2020 3.7 2.5 3.8 —%F-84See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^Moonlight Multi MediaProduction, Inc. Other InformationServices Term Loan 5.3% 2/1/2025 2.7 2.7 2.9 —%David M. Goens dba Superior AutoPaint & Body, Inc. Repair andMaintenance Term Loan 6% 8/26/2024 15.8 15.8 16.5 0.01%^McCallister Venture Group, LLCand Maw's Vittles, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 7/30/2029 10.9 10.9 11.6 —%^Chong Hun Im dba Kim's Market Food and BeverageStores Term Loan Prime plus2.5% 2/27/2024 8.3 8.3 8.6 —%Whirlwind Car Wash, Inc. Repair andMaintenance Term Loan Prime plus 2% 4/9/2029 65.2 65.2 66.9 0.02%^West Experience,Inc/WestMountain EquipmentRental,Inc/Ski West Lodge Amusement,Gambling, andRecreationIndustries Term Loan 6% 6/5/2026 826.6 826.6 868.6 0.31%^Center-Mark Car Wash, Ltd Specialty TradeContractors Term Loan Prime plus2.75% 5/18/2024 24.8 24.8 25.8 0.01%^Shuttle Car Wash, Inc. dba ShuttleCar Wash Repair andMaintenance Term Loan Prime plus2.25% 11/10/2028 16.0 16.0 16.6 0.01%^Min Hui Lin Food Services andDrinking Places Term Loan Prime plus2.75% 1/30/2028 16.4 16.4 17.3 0.01%^Delta Partners, LLC dba DeltaCarwash Repair andMaintenance Term Loan Prime plus2.5% 4/5/2029 40.2 40.2 42.3 0.02%^Auto Sales, Inc. Motor Vehicle andParts Dealers Term Loan 6% 8/17/2023 6.8 6.8 7.0 —%^RAB Services, Inc. & ProfessionalFloor Installations Specialty TradeContractors Term Loan Prime plus2.5% 1/31/2023 6.0 6.0 6.2 —%^Taste of Inverness, Inc. dba ChinaGarden Food Services andDrinking Places Term Loan Prime plus 2% 6/29/2025 7.9 7.9 8.1 —%^Ralph Werner dba WernerTransmission Inc Gasoline Stations Term Loan Prime plus2.75% 12/29/2021 1.9 1.9 2.0 —%^Robin C. & Charles E. Taylor &Brigantine Aquatic Center LLC Amusement,Gambling, andRecreationIndustries Term Loan 6% 9/14/2023 29.6 29.6 30.7 0.01%^OrthoQuest, P.C. Ambulatory HealthCare Services Term Loan Prime plus 2% 3/12/2022 3.4 3.4 3.5 —%^CPN Motel, L.L.C. dba AmericanMotor Lodge Accommodation Term Loan Prime plus2.25% 4/30/2024 27.4 27.4 28.0 0.01%^Track Side Collision & Tire, Inc. Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 6/16/2025 4.4 4.4 4.6 —%^Duttakrupa, LLC dba BirminghamMotor Court Accommodation Term Loan Prime plus2.25% 9/8/2023 10.7 10.7 10.9 —%^Deesha Corporation, Inc. dba BestInn & Suites Accommodation Term Loan Prime plus2.25% 2/14/2025 24.8 24.8 25.4 0.01%^Maruti, Inc Accommodation Term Loan Prime plus2.25% 11/25/2024 22.9 22.9 23.4 0.01%Willington Hills Equestrian CenterLLC Animal Productionand Aquaculture Term Loan Prime plus2.75% 10/19/2022 12.4 12.4 12.8 —%F-85See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets^LABH, Inc., Ramada Ltd. Accommodation Term Loan Prime plus2.25% 9/27/2024 36.7 36.7 37.6 0.01%^Randall D. & Patricia D. Casaburidba Pat's Pizzazz Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 3/13/2023 6.1 6.1 6.3 —%^Gain Laxmi, Inc. dba Super 8Motel Accommodation Term Loan Prime plus2.25% 5/31/2023 17.4 17.4 17.8 0.01%^Naseeb Corporation Accommodation Term Loan Prime plus2.25% 3/31/2024 26.4 26.4 27.1 0.01%^Stillwell Ave Prep School Social Assistance Term Loan Prime plus2.75% 1/14/2023 5.5 5.5 5.7 —%^Karis, Inc. Accommodation Term Loan Prime plus 2% 12/22/2023 11.8 11.8 11.9 —%^Five Corners, Ltd. Gasoline Stations Term Loan Prime plus2.75% 12/11/2019 3.2 3.2 3.3 —%^Alyssa Corp dba Knights Inn Accommodation Term Loan Prime plus2.25% 9/30/2023 38.8 38.8 39.6 0.01%^Bhailal Patel dba New Falls Motel Accommodation Term Loan Prime plus2.75% 3/27/2023 3.1 3.1 3.2 —%^Pegasus Automotive, Inc. Gasoline Stations Term Loan Prime plus2.75% 12/23/2022 9.4 9.4 9.7 —%^Delyannis Iron Works Fabricated MetalProductManufacturing Term Loan 6% 12/8/2022 10.8 10.8 11.2 —%^P. Agrino, Inc. dba Andover Diner Food Services andDrinking Places Term Loan Prime plus2.75% 7/18/2021 7.0 7.0 7.1 —%^RJS Service Corporation Gasoline Stations Term Loan Prime plus2.75% 8/20/2021 5.0 5.0 5.1 —%Total Performing SBAUnguaranteed Investments $264,318.4 $264,282.0 $266,467.1 95.74% Non-Performing SBAUnguaranteed Investments (3) *^200 North 8th Street AssociatesLLC and Enchanted Acres Farm Food Manufacturing Term Loan 6.25% 5/4/2028 $469.3 $469.3 $436.5 0.16%*^214 North Franklin, LLC andWinter Ventures, Inc. Nonstore Retailers Term Loan 6% 11/29/2037 81.7 81.7 — —%*^Alejandro Rico dba Rico Motorsand Golden West Motel and AlrimaCo Inc Motor Vehicle andParts Dealers Term Loan 6.75% 11/25/2040 68.4 68.4 2.8 —%*^Al-Mustafa Enterprise, Inc. andAl-Mustafa Enterprise Inc Motor Vehicle andParts Dealers Term Loan 6.25% 9/18/2040 34.7 34.7 — —%*^Amboy Group, LLC dbaTommy's Moloney's Food Manufacturing Term Loan Prime plus2.75% 6/24/2025 387.4 387.4 360.3 0.13%*^AUM Estates, LLC and SculptedFigures Plastic Surgery Inc. Ambulatory HealthCare Services Term Loan 6% 3/14/2038 305.7 305.7 — —%F-86See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets*AWA Fabrication &Construction, L.L.C. Fabricated MetalProductManufacturing Term Loan 6% 4/30/2025 34.8 34.8 — —%*^B & J ManufacturingCorporation and Benson RealtyTrust Fabricated MetalProductManufacturing Term Loan Prime plus 2% 3/30/2021 15.5 15.5 14.6 0.01%*Baker Sales, Inc. d/b/a BakerSales, Inc. Nonstore Retailers Term Loan 6% 3/29/2036 177.4 177.4 95.5 0.03%*^Fieldstone Quick Stop LLC,Barber Investments LLC, ThadiusM B Gasoline Stations Term Loan 6% 9/30/2038 407.3 407.3 2.6 —%*^Barber Investments LLC andFieldstone Quickstop LLC andMaine Dollar Gasoline Stations Term Loan 6.25% 8/15/2039 146.3 146.3 — —%*Bone Bar & Grill LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2042 73.4 73.4 64.2 0.02%*^Calhoun SatelliteCommunications Inc andTransmission Solutions Group Broadcasting (exceptInternet) Term Loan Prime plus2.75% 2/27/2025 811.7 811.7 431.3 0.15%*Calhoun SatelliteCommunications, Inc. Telecommunications Term Loan Prime plus2.75% 12/2/2026 189.1 189.1 172.6 0.06%*^Chickamauga Properties, Inc.,MSW Enterprises, LLP Amusement,Gambling, andRecreation Industries Term Loan 6.25% 12/22/2035 59.0 59.0 56.5 0.02%*^Chickamauga Properties, Inc.and MSW Enterprises, LLP Amusement,Gambling, andRecreation Industries Term Loan 6.25% 10/19/2022 43.5 43.5 — —%*^CLU Amboy, LLC and AmboyGroup, LLC dba TommyMoloney's Food Manufacturing Term Loan Prime plus2.75% 12/27/2023 479.8 479.8 446.2 0.16%*^CM Lab Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 5/20/2026 166.1 166.1 154.5 0.06%*^Custom Software, Inc. aColorado Corporation dba M-33Access Professional,Scientific, andTechnical Services Term Loan 6.25% 6/17/2021 272.7 272.7 234.6 0.08%*^Custom Software, Inc. aColorado Corporation dba M-33Access Broadcasting (exceptInternet) Term Loan 6.25% 4/30/2022 94.3 94.3 — —%*^D&G Capital LLC dba MiamiGrill 277 Food Services andDrinking Places Term Loan 6.5% 12/16/2025 81.2 81.2 55.5 0.02%*^Daniel S. Fitzpatrick dbaDanny's Mobile AppearanceReconditioning Service Repair andMaintenance Term Loan Prime plus2.75% 3/29/2018 0.3 0.3 0.3 —%*^Danjam Enterprises, LLC dbaAriel Dental Care Ambulatory HealthCare Services Term Loan 6% 3/31/2035 126.0 126.0 118.9 0.04%*^Danjam Enterprises, LLC dbaAriel Dental Care Ambulatory HealthCare Services Term Loan 6% 3/29/2023 64.8 64.8 61.1 0.02%*^Dill Street Bar and Grill Inc andWO Entertainment, Inc Food Services andDrinking Places Term Loan 6% 9/27/2027 78.4 78.4 — —%*^DTM Parts Supply Inc. MerchantWholesalers, DurableGoods Term Loan Prime plus2.75% 6/2/2025 54.8 54.8 43.9 0.02%F-87See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets*^E & I Holdings, LP & PA FarmProducts, LLC FoodManufacturing Term Loan 6% 4/30/2030 4,923.2 5,047.3 2,529.6 0.91%*^ENI Inc, Event Networks Inc,ENI Worldwide LLC and SpotShop Inc Professional,Scientific, andTechnical Services Term Loan 6.75% 4/25/2024 273.8 273.8 — —%*^ENI Inc. dba ENI Group, Inc Other InformationServices Term Loan 6.75% 12/11/2025 32.8 32.8 — —%*^Europlast Ltd Plastics and RubberProductsManufacturing Term Loan 6% 9/26/2022 314.9 314.9 28.4 0.01%*^Europlast Ltd Plastics and RubberProductsManufacturing Term Loan 6% 5/31/2023 73.4 73.4 — —%*^Event Mecca LLC Other InformationServices Term Loan 6% 4/10/2023 12.2 12.2 9.4 —%*^EZ Towing, Inc. Support Activitiesfor Transportation Term Loan 6% 1/31/2023 86.4 86.4 8.1 —%*^Gator Communications GroupLLC dba Harvard Printing Group Printing and RelatedSupport Activities Term Loan 6.25% 3/30/2022 233.5 233.5 11.2 —%*^Gator Communications GroupLLC dba Harvard Printing Group Printing and RelatedSupport Activities Term Loan 6.25% 4/25/2022 157.8 157.8 — —%*^Gator Communications Group,LLC dba Harvard Printing Group Printing and RelatedSupport Activities Term Loan 6.25% 3/27/2023 13.3 13.3 — —%*^Gino Italian American Deli andMeat Market Inc Food and BeverageStores Term Loan Prime plus2.75% 7/25/2041 530.2 530.2 493.2 0.18%*^Grand Manor Realty, Inc. &Kevin LaRoe Real Estate Term Loan 6% 2/20/2023 19.0 19.0 17.6 0.01%*Guzman Group, LLC Rental and LeasingServices Term Loan 6% 9/30/2019 181.3 181.3 173.3 0.06%*Harrelson MaterialsManagement, Inc Waste Managementand RemediationServices Term Loan 6% 6/24/2021 465.2 465.2 25.0 0.01%*^Hascher Gabelstapler Inc Repair andMaintenance Term Loan Prime plus2.75% 3/26/2024 107.7 107.7 100.2 0.04%*^Hemingway Custom CabinetryLLC Furniture andRelated ProductManufacturing Term Loan 6.5% 9/25/2025 198.6 198.6 62.5 0.02%*^Home Again Restaurant LLC Food Services andDrinking Places Term Loan 6.25% 6/30/2040 58.8 58.8 47.5 0.02%*^J And G Group Services LLCand United Vending of FloridaInc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 7/28/2026 29.6 29.6 27.5 0.01%*^J Olson Enterprises LLC andOlson Trucking Direct, Inc. TruckTransportation Term Loan 6% 6/28/2025 628.4 628.4 76.7 0.03%*^J&M Concessions, Inc.dba A-1Liquors Food and BeverageStores Term Loan 6.25% 3/3/2039 130.6 130.6 61.7 0.02%*^J&M Concessions Inc dba A 1Liquors Food and BeverageStores Term Loan Prime plus2.75% 2/27/2025 80.0 80.0 21.6 0.01%F-88See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets*^Jacksonville Beauty InstituteInc. dba Beauty Institute's Educational Services Term Loan 7% 10/23/2025 43.7 43.7 40.6 0.01%*Jenny's Wunderland, Inc. Social Assistance Term Loan 6% 6/29/2036 98.8 98.8 10.6 —%*^Karykion, Corporation dbaKarykion Corporation Professional,Scientific, andTechnical Services Term Loan 6% 6/28/2022 144.8 144.8 134.7 0.05%*^Kantz LLC and Kantz Auto LLCdba Kantz's Hometown Auto Motor Vehicle andParts Dealers Term Loan 6.25% 10/29/2039 11.1 11.1 10.3 —%*^Kids at Heart,LLC dba MonsterMini Golf Amusement,Gambling, andRecreationIndustries Term Loan 6.75% 9/22/2026 21.6 21.6 10.4 —%*Krishna of Orangeburg, Inc. Accommodation Term Loan 6% 2/20/2032 10.3 10.3 5.5 —%*^Kup's Auto Spa Inc Repair andMaintenance Term Loan 6.25% 11/15/2038 366.8 366.8 341.2 0.12%*Kup’s Auto Spa, Inc. Repair andMaintenance Term Loan 6.25% 10/23/2025 54.7 54.7 50.9 0.02%*^Las Casuelas Del Este Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 9/29/2041 791.6 791.6 393.1 0.14%*^Las Torres Development LLCdba Houston Event Centers Real Estate Term Loan 6% 8/27/2028 875.4 906.0 — —%*^LE & JS dba Laredo Mercado YCarniceria Food and BeverageStores Term Loan Prime plus2.75% 4/13/2026 18.5 18.5 — —%*^Luv 2 Play Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 5/12/2026 60.8 60.8 57.4 0.02%*^M and C Renovations Inc Construction ofBuildings Term Loan Prime plus2.75% 10/31/2024 12.8 12.8 10.0 —%*^Matchless Transportation LLCdba First Class Limo Transit and GroundPassengerTransportation Term Loan 6.25% 8/3/2022 125.3 125.3 110.0 0.04%*^Medeiros Holdings Inc dbaOutdoor Lighting Perspectives ofthe Triad ElectricalEquipment,Appliance, andComponentManufacturing Term Loan Prime plus2.75% 11/25/2025 19.5 19.5 6.1 —%*^Milliken and Milliken, Inc. dbaMilliken Wholesale Distribution MerchantWholesalers,Durable Goods Term Loan 6% 6/10/2036 25.6 25.6 — —%*^Mojo Brands Media, LLC Broadcasting(except Internet) Term Loan 6% 8/28/2023 725.0 725.0 342.9 0.12%*^Morris Glass and Construction Specialty TradeContractors Term Loan 6% 3/7/2021 465.1 482.1 53.5 0.02%*Municipal Hydro Sevices Inc. Rental and LeasingServices Term Loan Prime plus2.75% 3/30/2027 225.7 225.7 42.0 0.02%*New England Country DaySchool, Inc. and Thomas D.Walker Social Assistance Term Loan Prime plus2.75% 3/28/2042 362.6 362.6 293.2 0.11%*^New Paltz Dental Care, PLLCdba Ariel Dental Care Ambulatory HealthCare Services Term Loan 6% 6/19/2025 97.5 97.5 59.6 0.02%*^Colts V LLC and NowatzkeService Center, Inc Repair andMaintenance Term Loan 6.75% 9/26/2039 577.6 577.6 545.1 0.20%F-89See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets*^Nowatzke Service Center Incdba Nowatzke Truck and Trailer Repair andMaintenance Term Loan Prime plus2.75% 1/29/2026 96.9 96.9 91.5 0.03%*Paragon Fabricators Inc, ParagonField Services, Inc and ParagonGlobal Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 9/28/2026 608.3 608.3 272.1 0.10%*^Paragon Global, LLC andParagon Fabricators Inc andParagon Field Services Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 9/28/2041 400.1 400.1 340.3 0.12%*^Planet Verte, LLC dba AudioUnlimited Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/20/2020 16.4 16.4 15.7 0.01%*^Pooh's Corner Realty LLC andPooh's Corner Inc Social Assistance Term Loan Prime plus2.75% 7/23/2040 100.3 100.3 93.3 0.03%*Professional Systems, LLC andProfessional Cleaning Administrative andSupport Services Term Loan 6% 7/30/2020 131.8 131.8 1.8 —%*^RDT Enterprises LLC Specialty TradeContractors Term Loan Prime plus2.75% 9/15/2027 136.9 136.9 127.3 0.05%*^RDT Enterprises, L.L.C. Specialty TradeContractors Term Loan Prime plus2.75% 11/12/2025 19.5 19.5 — —%*^RDT Enterprises, LLC Specialty TradeContractors Term Loan Prime plus2.75% 12/31/2028 119.0 119.0 110.7 0.04%*^Route 130 SCPI Holdings LLC,Route 130 SCPI Operations LLC Food Services andDrinking Places Term Loan 6.25% 9/30/2039 536.4 536.4 320.1 0.12%*^Scoville Plumbing & HeatingInc and Thomas P. Scoville Specialty TradeContractors Term Loan 6.75% 7/25/2022 32.1 32.1 30.3 0.01%*^Shivsakti, LLC dba Knights Inn Accommodation Term Loan 6.25% 12/20/2032 8.0 8.0 — —%*^Sourceco Limited LiabilityCompany MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/17/2025 45.0 45.0 43.1 0.02%*^Sovereign Communications LLC Broadcasting(except Internet) Term Loan Prime plus2.75% 2/7/2024 697.1 697.1 345.4 0.12%*^Square Deal SidingCompany,LLC dba Square DealSiding Company Specialty TradeContractors Term Loan Prime plus2.75% 6/18/2025 20.3 20.3 19.4 0.01%*^STK Ventures Inc dba JP DockService & Supply Specialty TradeContractors Term Loan 6% 5/9/2037 31.6 31.6 — —%*^Stormrider Inc dba Shirley'sStormrider Inc TruckTransportation Term Loan Prime plus2.75% 9/23/2025 58.1 58.1 — —%*^Stormrider Inc dba Shirley'sStormrider, Inc TruckTransportation Term Loan Prime plus2.75% 11/25/2024 116.9 116.9 41.6 0.01%*Stormwise South Florida dbaStormwise Shutters Specialty TradeContractors Term Loan 6% 11/7/2036 111.2 111.2 — —%*^Tim's Tire & AutomotiveCenter, LLC Support Activitiesfor Transportation Term Loan Prime plus2.75% 8/16/2026 768.3 768.3 529.7 0.19%*^Thomas P. Scoville dba ScovillePlumbing & Heating, Inc. Specialty TradeContractors Term Loan 6.75% 11/16/2021 34.3 34.3 32.4 0.01%F-90See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssets*Transmission Solutions Group, Inc.and Calhoun SatelliteCommunications Telecommunications Term Loan Prime plus2.75% 12/2/2041 141.3 141.3 81.8 0.03%*^Winter Ventures Inc and 214 NFranklin LLC Nonstore Retailers Term Loan 6% 4/29/2024 56.6 56.6 — —%*^Winter Ventures Inc dbaQualitybargainbooks andQualitybargainmall Nonstore Retailers Term Loan 6% 12/23/2024 149.3 149.3 — —%*^Winter Ventures Inc dbaQualitybargainbooks andQualitybargainmall Nonstore Retailers Term Loan 6% 4/3/2029 134.5 134.5 — —%*^Wired LLC and Moulison NorthCorporation Specialty TradeContractors Term Loan 6.25% 6/30/2024 118.5 118.5 108.3 0.04%*^Wired LLC and Moulison NorthCorporation Specialty TradeContractors Term Loan 6.25% 7/3/2024 138.3 138.3 — —%Total Non-PerformingUnguaranteed SBA Investments $23,236.1 $23,407.8 $11,567.3 4.16% Total Unguaranteed SBAInvestments $287,554.5 $287,689.8 $278,034.4 99.89% Performing SBA GuaranteedInvestments (4) Beale Street Blues Company Inc.dbaBeatle Street Blues Company, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 12/14/2027 $2,906.3 $2,906.3 $3,182.3 1.14%Blue Lagoon Resort, LLC dba HillView Cottages Accommodation Term Loan Prime plus2.75% 12/21/2042 566.3 566.3 644.5 0.23%Gorilla Warfare LLC Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 12/22/2027 127.5 127.5 141.1 0.05%Advance Case Parts Inc Repair andMaintenance Term Loan Prime plus2.75% 12/22/2027 150.0 150.0 166.0 0.06%Anderson Farms Inc TruckTransportation Term Loan Prime plus2.75% 12/22/2027 3,750.0 3,750.0 4,106.3 1.48%Muckamuck Trucks, Inc. TruckTransportation Term Loan Prime plus2.75% 12/22/2027 78.2 78.2 86.5 0.03%TrialHawk Litigation Group LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/22/2027 89.3 89.3 98.8 0.04%Salida Family Chiropractic-PPLCdba Salida Sport and Spine Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/22/2027 68.0 68.0 75.2 0.03%Lab Partner, LLC and BeechtreeDiagnostics, LLP and CottonwoodDiagnostics Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/22/2027 2,334.8 2,334.8 2,568.2 0.92%Medical Plaza of Boro Park PC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/22/2027 187.5 187.5 207.5 0.07%Dudeck Enterprise LLC dba DetailGarage Las Vegas Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 12/22/2027 91.0 91.0 100.6 0.04%F-91See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssetsJacliff Investments Inc dbaInternational Heal PublishingIndustries (exceptInternet) Term Loan Prime plus2.75% 12/22/2027 150.0 150.0 166.0 0.06%O'Rourke's Diner, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/22/2027 21.3 21.3 23.5 0.01%Anglin Cultured Stone ProductsLLC Construction ofBuildings Term Loan Prime plus2.75% 12/27/2042 1,931.3 1,931.3 2,193.2 0.79%Farec, Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/29/2042 843.6 843.6 959.6 0.34%Best Choice Meats, Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/29/2027 585.0 585.0 647.3 0.23%Social Link LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/29/2027 63.8 63.8 70.5 0.03%Morrocco Method, Inc ChemicalManufacturing Term Loan Prime plus2.75% 12/27/2042 2,583.8 2,583.8 2,927.7 1.05%JBK Truck Trailer and Bus Inc. Repair andMaintenance Term Loan Prime plus2.75% 3/23/2042 255.9 255.9 290.3 0.10%Pecos Entertainment LLC dbaState Theater and Pecos Inn LLC Motion Picture andSound RecordingIndustries Term Loan Prime plus2.75% 3/27/2042 1,232.6 1,232.6 1,393.6 0.50%Swantown Inn & Spa LLC Accommodation Term Loan Prime plus2.75% 5/26/2042 245.7 245.7 278.8 0.10%House of Bread & Coffee Corpdba Casa Do Pao Food Services andDrinking Places Term Loan Prime plus2.75% 1/27/2042 403.8 403.8 457.8 0.16%CR Park Incorporated dba DefineBody and Mind Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/20/2027 142.7 142.7 157.9 0.06%AP6 LLC and Amishp LLC Food Services andDrinking Places Term Loan Prime plus2.75% 1/30/2042 321.2 321.2 364.2 0.13%Pro Anderson, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/11/2027 57.9 57.9 64.1 0.02%Looky Enterprises, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 10/18/2027 51.7 51.7 57.2 0.02%Berza TLG,LLC dba The LittleGym of Lake Charles Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/31/2027 73.0 73.0 73.0 0.03%Paramount Dance Studios Inc.and Homestead Dance Supply Educational Services Term Loan Prime plus2.75% 5/14/2043 647.9 647.9 737.0 0.26%Murf & Sons LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/16/2027 180.3 180.3 199.5 0.07%Beacon Brewing LLC and C'Sons, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/27/2042 151.1 151.1 172.0 0.06%F-92See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssetsAmped Coffee Company LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/28/2027 11.3 11.3 12.4 —%Utara LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/1/2027 36.3 36.3 40.2 0.01%Oil Palace, Inc. Performing Arts,Spectator Sports, andRelated Industries Term Loan Prime plus2.75% 12/4/2042 2,455.2 2,455.2 2,774.4 1.00%DHD Enterprise LLC dba EdibleArrangements #1699 Miscellaneous StoreRetailers Term Loan Prime plus2.75% 12/21/2027 47.4 47.4 52.5 0.02%Total Performing SBA GuaranteedInvestments $22,841.3 $22,841.3 $25,489.6 9.16% Total SBA Unguaranteed andGuaranteed Investments $310,395.8 $310,531.1 $303,524.0 109.05% Controlled Investments (5) *Advanced Cyber Security Systems,LLC (6), (19) Data processing,hosting and relatedservices. 50%MembershipInterest —% — $— $— $— —% Term Loan 3% December2014 381.0 381.0 — —%*Automated Merchant Services, Inc.(7), (19) Data processing,hosting and relatedservices. 100% CommonStock —% — — — — —%CDS Business Services, Inc. (8) Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities 100% CommonStock —% — — 4,428.0 8,000.0 2.87% Line of Credit Prime plus2.5% August 2018 6,396.0 6,396.0 6,396.0 2.30%*Newtek Technology Solutions, Inc.(11) Data processing,hosting and relatedservices. 100% CommonStock —% — — 8,384.0 12,400.0 4.46%*Fortress Data Management, LLC(19) Data processing,hosting and relatedservices. 100%MembershipInterest —% — — — — —%*Newtek Insurance Agency, LLC(13), (19) Insurance Carriersand RelatedActivities 100%MembershipInterest —% — — — 2,500.0 0.90%*PMTWorks Payroll, LLC (9) Data processing,hosting and relatedservices. 100%MembershipInterest —% — — 725.1 — —% Term Loan 10%-12% Variousmaturitiesthrough July2019 2,685.0 2,685.0 — —%Secure CyberGateway Services, LLC(10), (19) Data processing,hosting and relatedservices. 66.7%MembershipInterest —% — — — — —%F-93See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2017(In Thousands)Portfolio Company Industry Type ofInvestment Interest Rate(2) Maturity Principal Cost Fair Value % of NetAssetsSmall Business Lending, LLC (12),(19) Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities 100%MembershipInterest —% — — — 2,500.0 0.90%Summit Systems and Designs, LLC(14), (19) Data processing,hosting and relatedservices. 100%MembershipInterest —% — — — — —%*ADR Partners, LLC dba banc-servPartners, LLC (12) Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities 100%MembershipInterest —% — — 5,290.3 3,430.0 1.23%Premier Payments LLC (11) Data processing,hosting and relatedservices. 100%MembershipInterest —% — — 16,438.0 23,000.0 8.26%International Professional Marketing,Inc. (17) Professional,Scientific, andTechnical Services 100% CommonStock —% — — 4,000.0 4,000.0 1.44% Line of Credit Prime plus0.5% April 2018 450.0 450.0 450.0 0.16%SIDCO, LLC (17) Professional,Scientific, andTechnical Services 100%MembershipInterest —% — — 7,119.7 7,119.7 2.56% Line of Credit Prime plus0.5% July 2019 550.0 550.0 550.0 0.20%Universal Processing Services ofWisconsin, LLC (11) (19) Data processing,hosting and relatedservices. 100%MembershipInterest —% — — — 80,000.0 28.74%United Capital Source, LLC (18) Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities 100%MembershipInterest — — — 2,450.0 2,450.0 0.88%Titanium Asset Management, LLC(15) Administrative andSupport Services Term Loan 3% July 2017 193.9 193.9 — —% 100%MembershipInterest —% — — — — —%Excel WebSolutions, LLC (16) Data processing,hosting and relatedservices. Term Loan 10% September2018 406.6 406.6 359.9 0.13% 50%MembershipInterest —% — — — — —%Total Controlled Investments $11,062.5 $59,897.6 $153,155.6 55.03% Investments in Money MarketFunds UBS Select Treasury InstitutionalFund - 0.84% yield $9.2 $9.2 $9.2 —% Total Investments $321,467.5 $370,437.9 $456,688.8 164.08%F-94See accompanying notes to these consolidated financial statementsTable of Contents^ Denotes investment that has been pledged as collateral under the Securitization Trusts.* Denotes non-income producing security.(1) Newtek values each unguaranteed portion of SBA 7(a) performing loans (“Loan”) using a discounted cash flow analysis which projects future cash flowsand incorporates projections for Loan pre-payments and Loan defaults using historical portfolio data. The data predicts future prepayment and defaultprobability on curves which are based on Loan age. The recovery assumption for each Loan is specific to the discounted valuation of the collateralsupporting that Loan. Each Loan’s cash flow is discounted at a rate which approximates a market yield. The Loans were originated under the SBA 7(a)program and conform to the underwriting guidelines in effect at their time of origination. Newtek has been awarded Preferred Lender Program (“PLP”) statusfrom the SBA. The portions of these Loans are not guaranteed by the SBA. Individual loan participations can be sold to institutions which have been grantedan SBA 750 license. Loans can also be sold as a pool of loans in a security form to qualified investors.(2) Prime Rate is equal to 4.25% as of December 31, 2017.(3) Newtek values non-performing SBA 7(a) loans using a discounted cash flow analysis of the underlying collateral which supports the loan. Net recovery ofcollateral, (fair value less cost to liquidate) is applied to the discounted cash flow analysis based upon a time to liquidate estimate. Modified loans are valuedbased upon current payment streams and are re-amortized at the end of the modification period.(4) Newtek values guaranteed performing SBA 7(a) loans using the secondary SBA 7(a) market as a reference point. Newtek routinely sells performing SBA7(a) loans into this secondary market. Guaranteed portions of SBA 7(a) loans partially funded as of the valuation date are valued using level two inputs asdisclosed in Note 3.(5) Controlled Investments are disclosed above as equity investments (except as otherwise noted) in those companies that are “Controlled Investments” of theCompany as defined in the Investment Company Act of 1940. A company is deemed to be a “Controlled Investment” of Newtek Business Services Corp. ifNewtek Business Services Corp. or its subsidiaries owns more than 25% of the voting securities of such company. See Note 5 in the accompanying notes tothe consolidated financial statements for transactions during the year ended December 31, 2017 with affiliates the Company is deemed to control.(6) 50% owned by Wilshire Holdings I, Inc. (a subsidiary of Newtek Business Services Corp.), 50% owned by non-affiliate. The term loan is past its originalmaturity date and currently in default. As such, the fair value of the investment is zero.(7) 96.11% owned by Wilshire Partners, LLC (a subsidiary of Newtek Business Services Corp.), 3.89% owned by Newtek Business Services Corp.(8) 50.15% owned by The Whitestone Group, LLC (a subsidiary of Wilshire Holdings I, Inc., a subsidiary of Newtek Business Services Corp.) and 49.85%owned by Wilshire Holdings 1, Inc. (a subsidiary of Newtek Business Services Corp.).(9) 25% owned by The Whitestone Group, LLC, (a subsidiary of Wilshire Holdings I, Inc., a subsidiary of Newtek Business Services Corp.), 65% owned byWilshire Holdings I, Inc. (a subsidiary of Newtek Business Services Corp.), and 10% owned by Exponential business Development Co., Inc. (a subsidiary ofNewtek Business Services Corp.).(10) 66.7% owned by The Whitestone Group, LLC (a subsidiary of Wilshire Holdings I, Inc., a subsidiary of Newtek Business Services Corp.), 33.3% ownedby non-affiliate.(11) 100% owned by Newtek Business Services Holdco1., Inc. (a subsidiary of Newtek Business Services Corp.).(12) 100% owned by Newtek LSP Holdco, LLC (a subsidiary of Wilshire Holdings I, Inc. and Newtek Business Services Holdco 5, Inc., both subsidiaries ofNewtek Business Services Corp.).(13) 100% owned by Wilshire Holdings I, Inc. (a subsidiary of Newtek Business Services Corp.).(14) 100% owned by The Whitestone Group, LLC (a subsidiary of Wilshire Holdings I, Inc., a subsidiary of Newtek Business Services Corp.).(15) 50% owned by Exponential Business Development Co., Inc. (a subsidiary of Newtek Business Services Corp.), 47.8% owned by The Whitestone Group,LLC (a subsidiary of Wilshire Holdings I, Inc., a subsidiary of Newtek Business Services Corp.) and 2.2% owned by Wilshire New York Advisers II, LLC (asubsidiary of Newtek Business Services Corp.).(16) 50% owned by The Whitestone Group, LLC (a subsidiary of Wilshire Holdings I, Inc., a subsidiary of Newtek Business Services Corp.) and 50% ownedby non-affiliate.(17) 100% owned by Newtek Business Services Holdco 2, Inc. (a subsidiary of Newtek Business Services Corp.). During the year ended December 31, 2017, aportion of IPM’s business was spun off into a new wholly-owned controlled portfolio company, SIDCO. As a result, the underlying IPM business has notchanged. The Company determined the cost basis of its investments in IPM and SIDCO to be $4,000,000 and $7,120,000, respectively. Refer to Note 4.(18) 100% owned by Newtek Business Services Holdco 3, Inc. (a subsidiary of Newtek Business Services Corp.).(19) Zero cost basis is reflected as the portfolio company was organized by the Company and incurred internal legal costs to organize the entity andimmaterial external filing fees which were expensed when incurred.(20) All of the Company’s investments are in entities which are organized under the Laws of the United States and have a principal place of business in theUnited States(21) Under the Investment Company Act of 1940, as amended, the Company may not acquire any non-qualifying assets unless, at the time the acquisition ismade, qualifying assets represent at least 70% of the Company’s total assets. At December 31, 2017, 4.8% of total assets are non-qualifying assets.F-95See accompanying notes to these consolidated financial statementsTable of ContentsAs of December 31, 2017, the federal tax cost of investments was $361,680,000 resulting in estimated gross unrealized gains and losses of $119,606,000 and$24,597,000, respectively.F-96See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssetsPerforming SBA UnguaranteedInvestments (1) Fort Smith Wings Inc. dba WingStop Food Services andDrinking Places Term Loan Prime plus2.75% 12/28/2026 19.5 19.5 17.4 0.01%Sand Hill Associates, Ltd. dbaCharlie O's Tavern on the Point Food Services andDrinking Places Term Loan Prime plus2.75% 12/27/2041 419.9 419.9 409.7 0.20%Joshua L. Baker Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 12/23/2026 15.8 15.8 13.4 0.01%Jacliff Investments Inc. dbaInternational health Technologies PublishingIndustries (exceptInternet) Term Loan Prime plus2.75% 12/23/2026 125.0 125.0 106.7 0.05%New Image Building Services, Inc. Administrative andSupport Services Term Loan Prime plus2.75% 12/21/2026 43.8 43.8 38.7 0.02%Chestnut Street Associates, LLCand Metropolitan Solutions, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/19/2041 275.0 275.0 261.1 0.12%Means Enterprises LLC dbaFastFrame Frisco Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 12/16/2026 22.5 22.5 19.5 0.01%New Chicago Wholesale Bakery,Inc. Food Manufacturing Term Loan Prime plus2.75% 12/15/2041 452.8 452.8 443.6 0.21%Soon Im. Chin dba Stan C-Store Gasoline Stations Term Loan Prime plus2.75% 12/15/2041 212.5 212.5 216.6 0.10%Sempco, Inc. MiscellaneousManufacturing Term Loan Prime plus2.75% 12/15/2041 42.0 42.0 43.6 0.02%Allied Welding Inc. Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 12/15/2041 750.0 750.0 727.9 0.35%Ericon, Inc. dba Quik Pik Gasoline Stations Term Loan Prime plus2.75% 12/15/2041 332.2 332.2 328.4 0.16%White Hawk Inc. TruckTransportation Term Loan Prime plus2.75% 12/15/2026 1,097.8 1,097.8 937.2 0.45%Elita 7, LLC Nursing andResidential CareFacilities Term Loan Prime plus2.75% 12/15/2041 712.5 712.5 716.0 0.34%Techni-Pro Institute LLC Educational Services Term Loan Prime plus2.75% 12/15/2026 190.0 190.0 166.9 0.08%HMG Strategy, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/14/2026 50.0 50.0 42.7 0.02%Cardinal Homes Inc. and Bret ABerneche Wood ProductManufacturing Term Loan Prime plus2.75% 12/14/2041 121.3 121.3 125.3 0.06%Trison Enterprises Inc.dba Lee'sAutomotive Repair andMaintenance Term Loan Prime plus2.75% 12/14/2041 407.5 407.5 406.2 0.19%F-97See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssetsAGG Management Team LLC dbaChevron Gasoline Stations Term Loan Prime plus2.75% 12/14/2041 287.5 287.5 298.3 0.14%Cardinal Homes Inc,.AlouetteHoldings Inc. Wood ProductManufacturing Term Loan Prime plus2.75% 12/14/2026 1,071.3 1,071.3 1,074.5 0.51%D and E Hardware Co. and D andE Pump Sales and Service Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 12/14/2041 528.6 528.6 518.6 0.25%Wayfarer Bicycle LLC Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 12/13/2041 92.5 92.5 88.9 0.04%Success Advertising Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/13/2041 466.5 466.5 476.4 0.23%Roast Beef Levittown LLC dbaArby's Food Services andDrinking Places Term Loan Prime plus2.75% 12/13/2026 465.0 54.6 55.0 0.03%Queen Express LLC Gasoline Stations Term Loan Prime plus2.75% 12/13/2041 187.5 187.5 191.6 0.09%Mack Team Enterprises Inc.dbaThe UPS Store #6815 Couriers andMessengers Term Loan Prime plus2.75% 12/9/2026 20.4 20.4 18.2 0.01%Recycling Revolution,LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/9/2041 92.2 92.2 90.4 0.04%Myndshft Technologies LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/9/2026 775.0 775.0 731.8 0.35%^New Life Hospital LLC Hospitals Term Loan Prime plus2.75% 12/8/2041 1,195.5 1,195.5 1,240.3 0.59%Imagine By Carleen Inc. Personal andLaundry Services Term Loan Prime plus2.75% 12/8/2041 52.5 52.5 53.3 0.03%Hanson's Greeks LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/8/2026 11.3 11.3 11.3 0.01%Yachting Solutions LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 12/7/2029 71.3 71.3 67.4 0.03%T & B Boots, Inc. dba Takken'sShoes Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 12/7/2026 100.0 100.0 93.0 0.04%Lan Doctors, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/7/2026 237.5 237.5 230.8 0.11%^The Lake Shore Hospitality Incdba Dowagiac Baymont Inn &Suites Accommodation Term Loan Prime plus2.75% 12/5/2041 352.5 352.5 358.5 0.17%Lilo Holdings LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/5/2026 15.9 15.9 14.3 0.01%F-98See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets Transmission Solutions Group,Inc. and Calhoun SatelliteCommunications Telecommunications Term Loan Prime plus2.75% 12/2/2041 141.3 141.3 130.2 0.06%Calhoun Satellite Communications,Inc. Telecommunications Term Loan Prime plus2.75% 12/2/2026 192.5 192.5 171.7 0.08%Noso Development LLC Construction ofBuildings Term Loan Prime plus2.75% 12/1/2026 75.0 75.0 64.0 0.03%^Ericon, Inc. Gasoline Stations Term Loan Prime plus2.75% 12/1/2041 726.1 726.1 717.8 0.34%^Pebble Wood Lane, LLC andGood Sam's Assisted LivingResiidence,LLC Nursing andResidential CareFacilities Term Loan Prime plus2.75% 11/30/2041 67.5 67.5 70.0 0.03%Sharaz Shah DBA ThomasJewelers Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 11/30/2026 8.1 8.1 6.9 —%Choe Trading Group, Inc.dbaRapid Printers of Monterey Printing and RelatedSupport Activities Term Loan Prime plus2.75% 11/30/2026 22.5 22.5 21.9 0.01%Studio Find It Georgia, Inc. Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 11/30/2026 7.5 7.5 6.5 —%^Quick Ship, LLC Couriers andMessengers Term Loan Prime plus2.75% 11/30/2026 10.5 10.5 9.0 —%B4 Fitness LLC dba The ZooHealth Club Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 11/30/2026 22.5 22.5 20.0 0.01%Imaginarium Foods LLC, Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2042 376.7 124.4 129.2 0.06%RD Management, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/30/2026 213.8 213.8 184.7 0.09%^Usman Jalil, LLC dba Food Mart Gasoline Stations Term Loan Prime plus2.75% 11/29/2041 233.3 233.3 223.3 0.11%Honor Mansion, Inc. Accommodation Term Loan Prime plus2.75% 11/29/2026 87.5 87.5 88.1 0.04%Access Staffing, LLC Administrative andSupport Services Term Loan Prime plus2.75% 11/29/2026 1,125.0 1,125.0 960.4 0.46%WPN Recycling Company LLC MerchantWholesalers, DurableGoods Term Loan Prime plus2.75% 11/23/2026 22.5 22.5 22.7 0.01%Hafa Adai Signs and Graphics LLCdba Fastsigns of Auburn -#281901 Administrative andSupport Services Term Loan Prime plus2.75% 11/23/2026 60.0 60.0 51.9 0.02%CRK Mens, LLC dba Spiff forMen Personal andLaundry Services Term Loan Prime plus2.75% 11/23/2026 106.3 106.3 92.5 0.04%Merchant Coterie, Inc. MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 11/23/2026 125.0 125.0 106.7 0.05%F-99See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets6E Technologies LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/22/2026 175.0 175.0 160.2 0.08%Broms Asset Management LLC Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 11/22/2026 125.0 125.0 106.7 0.05%Rognes Corp dba RTS Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 11/22/2026 389.3 389.3 354.1 0.17%Bouquet Restaurant LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/22/2041 125.0 125.0 124.9 0.06%^J.B.K Truck Trailer and Bus Inc Repair andMaintenance Term Loan Prime plus2.75% 11/22/2041 435.0 435.0 427.8 0.20%Skaggs RV Outlet LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 11/21/2026 100.0 100.0 100.7 0.05%Catherine Christine Morin dba Purr-Fect Pets Personal andLaundry Services Term Loan Prime plus2.75% 11/17/2026 18.8 18.8 16.0 0.01%Stratmar Systems Inc dba StratmarRetail Services Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/16/2026 68.5 68.5 69.0 0.03%Hoosier Health Plus, LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/15/2026 125.0 125.0 116.8 0.06%^J. A. Kohlhepp Sons, Inc. dbaKohlhepp's True Value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/10/2041 446.0 446.0 450.1 0.22%Hackensack Steel Corporation andLuzerne Ironworks Inc Specialty TradeContractors Term Loan Prime plus2.75% 11/10/2026 239.2 239.2 238.8 0.11%^Panther Ironworks and RiggingSolutions LLC Specialty TradeContractors Term Loan Prime plus2.75% 11/10/2026 151.3 151.3 138.0 0.07%^J. A. Kohlhepp Sons, Inc. dbaKohlhepp's True Value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/10/2026 188.8 188.8 184.8 0.09%^Bovill Creative,LLC Real Estate Term Loan Prime plus2.75% 11/9/2041 281.2 281.1 291.7 0.14%^Big Apple Entertainment PartnersLLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 11/9/2026 175.0 175.0 149.4 0.07%^Dyer Properties, LLC and BayviewPharmacy, Inc. Health and PersonalCare Stores Term Loan Prime plus2.75% 11/9/2041 240.3 240.3 234.1 0.11%^Rich's Food Stores LLC dba Hwy55 of Wallace Food Services andDrinking Places Term Loan Prime plus2.75% 11/9/2026 43.8 43.8 40.5 0.02%F-100See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssetsMIK LLC dba Firehouse Subs Food Services andDrinking Places Term Loan Prime plus2.75% 11/9/2026 200.0 163.3 141.6 0.07%Surgarloaf Concepts LLC dba FatBiscuit Food Services andDrinking Places Term Loan Prime plus2.75% 11/8/2026 168.8 95.9 96.6 0.05%^Fine Line Interiors, Inc. Repair andMaintenance Term Loan Prime plus2.75% 11/4/2041 87.5 87.5 90.8 0.04%^Pig-Sty BBQ, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/3/2026 71.3 71.3 71.8 0.03%131 Miles LLC and Ohm ShubhLaxmi, LLC. dba Mr Hero Food Services andDrinking Places Term Loan Prime plus2.75% 11/3/2041 127.5 35.8 37.2 0.02%^Veracruz Shabo, LLC, WaterfallsQuick Lube LLC Repair andMaintenance Term Loan Prime plus2.75% 11/1/2041 118.8 118.8 119.6 0.06%Glocecol LLC Administrative andSupport Services Term Loan Prime plus2.75% 11/1/2026 75.0 75.0 75.5 0.04%Middlesex Auto Sales Corp Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 10/31/2041 125.0 47.5 49.3 0.02%^Bloomquist Communications Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 10/31/2026 60.0 59.6 50.9 0.02%^Moolchan Enterprises LLC dbaStaying Green Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 10/31/2026 18.2 18.0 16.9 0.01%^Woodstock Enterprises Corp dbaTrue Scent Candle Company MiscellaneousManufacturing Term Loan Prime plus2.75% 10/31/2041 88.8 88.6 85.2 0.04%^Patina Investment, Inc and Ram &Sons, Inc. Repair andMaintenance Term Loan Prime plus2.75% 10/27/2041 175.0 174.8 181.3 0.09%Elite Structures Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 10/27/2029 225.0 225.0 217.4 0.10%^FibAire Communications, LLC Telecommunications Term Loan Prime plus2.75% 10/27/2026 107.5 106.8 97.6 0.05%^Bonita Stone LLC and CastoneCreations Inc Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 10/25/2041 264.4 264.0 259.4 0.12%^Empire Processor Services Inc.and Verrazano Wholesale Dist., Inc. Nonstore Retailers Term Loan Prime plus2.75% 10/25/2026 131.3 130.5 131.4 0.06%Blakeslee Arpaia Chapman Inc andChapman Construction ServicesLLC Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 10/24/2026 425.0 422.4 416.6 0.20%Eco Vehicle Systems LLC TransportationEquipmentManufacturing Term Loan Prime plus2.75% 10/21/2026 955.5 949.8 940.4 0.45%Worldwide Estate, Inc. dbaWashington Heights Manor Nursing andResidential CareFacilities Term Loan Prime plus2.75% 10/21/2041 225.0 155.8 161.6 0.08%^Gold Wind Logistics LLC TruckTransportation Term Loan Prime plus2.75% 10/20/2041 175.0 175.0 181.6 0.09%F-101See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Speaker City, Inc. dba RollinThunder Electronics andAppliance Stores Term Loan Prime plus2.75% 10/14/2041 125.0 124.8 125.3 0.06%^Maine Service Corp MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 10/13/2026 206.3 204.3 190.3 0.09%^Justin Partlow Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 10/13/2026 19.5 19.4 16.5 0.01%^Reliable Recovery Services LLC Support Activitiesfor Transportation Term Loan Prime plus2.75% 10/7/2026 112.5 111.8 101.4 0.05%^Ailky Corporation Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 10/3/2026 250.0 248.5 217.5 0.10%^Wyspen Corporation dbaCharlestown Ace Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 10/3/2026 36.0 35.8 30.5 0.01%^JJA Transportation ManagementInc. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/30/2026 52.5 51.9 44.3 0.02%^MegaPhase, LLC Computer andElectronic ProductManufacturing Term Loan Prime plus2.75% 9/30/2026 150.0 148.2 141.8 0.07%^Seaway LLC and Reklaw LLC dbaAllure Lounge Food Services andDrinking Places Term Loan Prime plus2.75% 9/30/2041 137.5 137.1 142.2 0.07%^Adelworth Bus Corp. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/30/2041 242.8 242.1 236.6 0.11%Adelwerth Bus Corporation,Transportation Leasing Corp. Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/30/2029 654.0 648.5 619.6 0.30%^Las Casuelas Del Este Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 9/29/2041 800.0 799.4 811.3 0.39%^Thunderdome Racing Inc. Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 9/29/2026 19.1 18.8 18.4 0.01%Vision Automotive LLC dba VisionChrysler Jeep Dodge Ram ofDefiance Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 9/29/2029 671.5 665.8 619.7 0.30%Paragon Fabricators Inc, ParagonField Services, Inc and ParagonGlobal Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 9/28/2026 648.0 640.1 586.2 0.28%^Paragon Global, LLC and ParagonFabricators Inc and Paragon FieldService Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 9/28/2041 405.8 404.6 382.3 0.18%^Graphics,Type and ColorEnterprises Inc dba Clubflyers.comand GTC Med Printing and RelatedSupport Activities Term Loan Prime plus2.75% 9/28/2041 850.0 847.6 879.0 0.42%^Beadon Inc Food and BeverageStores Term Loan Prime plus2.75% 9/28/2026 22.5 22.2 22.0 0.01%F-102See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^CD Game Exchange Inc. MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/28/2026 22.5 22.2 19.0 0.01%^CNC Precision Machine, Inc. Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/28/2041 1,250.0 1,246.5 1,230.6 0.59%^Kyle M Walker DDS,PC Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/27/2026 217.8 215.1 189.0 0.09%^Luna Nueva LLC dba Bio Builders Specialty TradeContractors Term Loan Prime plus2.75% 9/27/2026 15.0 14.8 13.0 0.01%Reynolds Fence & Guardrail Inc. Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 9/27/2026 629.6 621.9 596.4 0.29%^Luv 2 Play Nor Call, LLC dba Luv2 Play Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/27/2026 52.5 51.9 46.3 0.02%^Sarah S Olelewe MD Inc Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/26/2041 292.4 292.2 289.2 0.14%^TPFC,LLC dbaThe Picture FrameCompany Miscellaneous StoreRetailers Term Loan Prime plus2.75% 9/26/2041 58.8 58.6 58.1 0.03%^Ridge Road Equestrian LLC dbaRicochet Ridge Ranch Support Activitiesfor Agriculture andForestry Term Loan Prime plus2.75% 9/26/2026 9.0 8.9 8.7 —%^PeopleBest Inc. Administrative andSupport Services Term Loan Prime plus2.75% 9/26/2026 15.0 14.8 12.6 0.01%^Mr. Mulch, Inc Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 9/23/2041 405.8 404.6 375.8 0.18%^B4 Fitness LLC dba The ZooHealth Club Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/23/2026 87.5 86.4 76.8 0.04%^InformationTelevision NetworkInc Motion Picture andSound RecordingIndustries Term Loan Prime plus2.75% 9/22/2041 836.8 835.6 856.4 0.41%^Kids at Heart,LLC dba MonsterMini Golf Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/22/2026 22.5 22.3 19.3 0.01%^GRA Financial Services Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/22/2026 12.0 11.9 10.1 —%^Wrecking Crew Media LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 9/21/2026 50.0 49.4 42.1 0.02%^Cuppiecakes LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/21/2041 22.5 22.4 22.1 0.01%^Benoit's Towing and RecoveryLLC Support Activitiesfor Transportation Term Loan Prime plus2.75% 9/20/2026 12.0 11.9 10.3 —%F-103See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Consulting Solutions Inc. andMark Luciani Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/20/2026 22.5 22.3 20.8 0.01%^Brittany Burns LLC dba DreamsCome True Personal andLaundry Services Term Loan Prime plus2.75% 9/19/2026 12.9 12.7 12.8 0.01%^Eyncon LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/16/2041 50.0 49.9 49.8 0.02%^Tresa S.Parris dba Wagging TailsGrooming Personal andLaundry Services Term Loan Prime plus2.75% 9/16/2026 8.0 7.9 6.8 —%^The Merrin Group LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/15/2026 175.0 172.9 164.8 0.08%^Rich's Food Stores LLC dba Hwy55 of Wallace Food Services andDrinking Places Term Loan Prime plus2.75% 9/14/2026 145.5 143.7 133.2 0.06%^Atlantic Alarm Systems andServices LLC Administrative andSupport Services Term Loan Prime plus2.75% 9/14/2026 15.5 15.3 13.4 0.01%^Metropet Dog Center, Inc Personal andLaundry Services Term Loan Prime plus2.75% 9/13/2041 109.3 108.9 109.2 0.05%^Marquis Cattle Company Animal Productionand Aquaculture Term Loan Prime plus2.75% 9/13/2026 50.0 49.7 50.1 0.02%^Bingham Enterprises, Inc and FullBelli Deli and Sausage Company Food Services andDrinking Places Term Loan Prime plus2.75% 9/12/2041 82.5 82.3 79.6 0.04%^Artisan Infrastructure Holdings,LLC Data Processing,Hosting, and RelatedServices Term Loan Prime plus2.75% 9/7/2026 125.0 123.5 105.4 0.05%^SRA Mechanicial Inc Specialty TradeContractors Term Loan Prime plus2.75% 9/6/2041 43.8 43.6 45.0 0.02%^Sandia Enterprises Inc dbaMassage Envy Spa Personal andLaundry Services Term Loan Prime plus2.75% 9/6/2026 62.5 61.7 52.7 0.03%^Animal Intrusion PreventionSystems Holding Company, LLC Administrative andSupport Services Term Loan Prime plus2.75% 8/30/2026 125.0 123.0 107.7 0.05%^Suncrest Stone Products LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 8/29/2026 586.8 576.0 514.8 0.25%^Clark Realty LLC Real Estate Term Loan Prime plus2.75% 8/29/2041 237.5 236.5 225.0 0.11%^Raem Corporation dba DrycleanExpress Personal andLaundry Services Term Loan Prime plus2.75% 8/29/2041 72.5 72.2 73.9 0.04%^Suncrest Stone Products LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 8/29/2041 649.6 646.9 596.9 0.29%^TAGR Inc dba Miami Grill137and John Nakis Food Services andDrinking Places Term Loan Prime plus2.75% 8/26/2026 106.8 104.8 91.7 0.04%^Warren Dale Warrington dbaCustom Paint and Body Repair andMaintenance Term Loan Prime plus2.75% 8/26/2041 101.3 100.8 101.6 0.05%F-104See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Albert Basse Associates Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 8/25/2026 62.5 61.4 61.1 0.03%^Dean Technology Inc ElectricalEquipment,Appliance, andComponentManufacturing Term Loan Prime plus2.75% 8/25/2041 387.1 385.5 396.3 0.19%^Rosmel Pools Inc Repair andMaintenance Term Loan Prime plus2.75% 8/25/2026 22.5 22.1 19.3 0.01%^Avery Management Inc. dbaWhetstone Upholstery Repair andMaintenance Term Loan Prime plus2.75% 8/25/2026 10.7 10.5 8.9 —%^TR Companies LLC dba TrueValue Rental and Liberty Rental 4U Rental and LeasingServices Term Loan Prime plus2.75% 8/25/2026 90.0 88.4 75.4 0.04%^Tabadesa Associates Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/25/2026 22.5 22.1 18.8 0.01%Sambella Holdings, LLC and StrikeZone Entertainment Center LLC Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 12/24/2041 500.0 366.5 380.2 0.18%^Tim's Tire & Automotive Center,LLC Support Activitiesfor Transportation Term Loan Prime plus2.75% 8/16/2026 816.6 797.7 721.6 0.35%^Luv 2 Play Temecula, LLC Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 8/15/2026 60.0 58.9 50.3 0.02%Bear Creek Entertainment LLC dbaThe Woods at Bear Creek Accommodation Term Loan Prime plus2.75% 8/12/2041 437.5 279.1 284.3 0.14%^2 Cool Beans LLC dba Menchies'sFrozen Yogurt Food Services andDrinking Places Term Loan Prime plus2.75% 8/11/2026 82.5 81.0 69.1 0.03%^Grayson O Company MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 8/10/2041 625.0 622.4 639.7 0.31%^Charal Investments LLC dbaOrange Theory Fitness Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 8/10/2026 87.5 85.9 73.3 0.04%^PCNKC Inc dba Plato's Closet Miscellaneous StoreRetailers Term Loan Prime plus2.75% 8/10/2026 18.8 18.5 16.2 0.01%^Paul Belanger dba Paul BelangerLandscaping Administrative andSupport Services Term Loan Prime plus2.75% 8/9/2026 15.0 14.7 12.6 0.01%^R Performance LLC dbaPerformance Automotive of SanDiego Repair andMaintenance Term Loan Prime plus2.75% 7/29/2026 15.0 14.6 12.8 0.01%^The Hungry Rhino LLC Real Estate Term Loan Prime plus2.75% 7/29/2041 76.3 75.8 74.9 0.04%^Nicolette Reiser dba Comfort &Balance Personal andLaundry Services Term Loan Prime plus2.75% 7/29/2041 75.0 74.6 75.1 0.04%^USA General Investment LLC dbaBraniff Paint and Body Shop Repair andMaintenance Term Loan Prime plus2.75% 7/29/2026 22.5 21.9 19.3 0.01%F-105See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Little Tree Huggers Child CareLLC Social Assistance Term Loan Prime plus2.75% 7/29/2041 140.0 139.2 143.9 0.07%^303 Tower Drive LLC Repair andMaintenance Term Loan Prime plus2.75% 7/29/2041 400.3 398.0 403.4 0.19%^KJCKD Inc dba Camelot Print &Copy Centers/Copy A Second Administrative andSupport Services Term Loan Prime plus2.75% 7/28/2041 587.0 583.7 578.9 0.28%^Big Apple Entertainment PartnersLLC dba Ripley's Believe It or Not Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 7/28/2026 300.0 292.6 249.7 0.12%^676 Club LP dba The Green DoorTavern/The Drifter Food Services andDrinking Places Term Loan Prime plus2.75% 7/28/2041 670.0 665.0 679.9 0.33%^MacIver Corporation dbaDivision Camera Rental and LeasingServices Term Loan Prime plus2.75% 7/28/2026 1,250.0 1,219.3 1,143.1 0.55%^J And G Group Services LLC andUnited Vending of Florida Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 7/28/2026 31.5 30.8 27.5 0.01%^Intrepid Trinity LLC Nonstore Retailers Term Loan Prime plus2.75% 7/28/2041 62.5 62.1 62.4 0.03%^Apple Tree NC Inc dba WilliamsFarm & Garden Center Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 7/28/2041 337.0 335.1 327.8 0.16%^Kidtastic LLC dba The Little Gymof Audubon Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 7/27/2026 53.8 52.8 45.0 0.02%^GF Libations Inc dba MinutemanPress Printing and RelatedSupport Activities Term Loan Prime plus2.75% 7/27/2041 40.5 39.5 34.9 0.02%^EPEC Juice LLC dba Jamba Juice Food Services andDrinking Places Term Loan Prime plus2.75% 7/27/2026 82.5 81.5 69.5 0.03%^Pinco Pizza LLC dba Jet's Pizza Food Services andDrinking Places Term Loan Prime plus2.75% 7/27/2026 72.9 72.0 70.4 0.03%^Peckett's Inc Crop Production Term Loan Prime plus2.75% 7/27/2041 225.0 224.7 233.0 0.11%^JAG Unit 1, LLC dba Arooga'sGrille House and Sports Bar Food Services andDrinking Places Term Loan Prime plus2.75% 7/27/2026 125.0 121.9 104.1 0.05%^The Grasso Companies, LLC andGrasso Pavement Maintenance,LLC Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 7/26/2026 91.0 88.9 80.9 0.04%^Gino Italian American Deli andMeat Market Inc Food and BeverageStores Term Loan Prime plus2.75% 7/25/2041 536.8 534.2 525.0 0.25%^My Sainath Inc dba Motel 6 Accommodation Term Loan Prime plus2.75% 7/22/2041 305.4 303.7 308.6 0.15%^Robert G Larson State FarmInsurance Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 7/22/2026 22.5 21.9 18.7 0.01%F-106See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^J and D Resources LLC dba AquaScience Specialty TradeContractors Term Loan Prime plus2.75% 7/19/2026 130.5 127.3 109.7 0.05%^Robert P Daniels dba Ginger andFriend's Peppermint Village GiftShop Miscellaneous StoreRetailers Term Loan Prime plus2.75% 7/18/2026 15.8 15.4 13.1 0.01%Franklin Firm LLC dba Luv 2 Play Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 7/15/2041 173.3 172.9 171.6 0.08%^Billingsworks LLC dba SpoonShine Cafe Food Services andDrinking Places Term Loan Prime plus2.75% 7/15/2026 9.7 9.4 9.5 —%^Be Beautiful LLC Personal andLaundry Services Term Loan Prime plus2.75% 7/14/2041 66.5 66.1 67.2 0.03%^Takeuchi Commercial CleaningServices, LLC dba We Clean SanDiego Administrative andSupport Services Term Loan Prime plus2.75% 7/13/2026 46.3 45.1 38.5 0.02%^Jacob Rugs LLC dba Rugs Outlet Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 7/13/2026 65.6 64.0 64.5 0.03%^RM Hawkins LLC dba Pure WaterTech West Nonstore Retailers Term Loan Prime plus2.75% 7/7/2026 50.0 48.9 46.5 0.02%^Dino Smiles Children's CosmeticDentistry Ambulatory HealthCare Services Term Loan Prime plus2.75% 7/7/2026 14.3 13.9 12.2 0.01%Nevey's LLC dba Stark Food III Food and BeverageStores Term Loan Prime plus2.75% 6/30/2041 293.9 246.6 254.5 0.12%^P L H Pharmaco Inc dba FarmaciaSan Jose Health and PersonalCare Stores Term Loan Prime plus2.75% 6/30/2026 175.0 169.7 165.5 0.08%^Soregard Inc Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 6/30/2041 278.8 276.8 260.2 0.12%^Martin Inventory ManagementLLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 6/30/2026 105.8 102.5 102.8 0.05%^Desert Tacos LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2026 98.8 98.3 91.3 0.04%^VMA Technologies LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/30/2026 22.5 21.8 18.4 0.01%^Corning Lumber Company Incand Frank R Close and Son Inc Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 6/30/2029 195.5 191.3 193.4 0.09%^Castone Creations Inc Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 6/29/2026 87.5 84.8 74.7 0.04%^WGI, LLC dba Williams Grant Inn Accommodation Term Loan Prime plus2.75% 6/29/2041 131.3 130.3 128.8 0.06%^O.D.S. Inc dba Four SeasonsHealth & Racquet and Step 'N'Motion, Inc Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 6/29/2026 140.0 135.7 117.5 0.06%F-107See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^KWG Industries, LLC dbaPeterson & Marsh Metal Industries Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 6/29/2041 304.5 302.8 303.9 0.15%^Ninsa LLC Specialty TradeContractors Term Loan Prime plus2.75% 6/29/2041 112.5 111.7 115.5 0.06%^E & P Holdings 1 LLC and Evans& Paul LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 6/28/2026 125.0 121.4 105.9 0.05%^MaidPro Marin dba MaidPro Administrative andSupport Services Term Loan Prime plus2.75% 6/28/2026 17.6 17.0 14.3 0.01%^Edge Pest Control LLC Administrative andSupport Services Term Loan Prime plus2.75% 6/27/2026 750.0 726.9 612.0 0.29%^All Printing Solutions, Inc. dbaPryntcomm Printing and RelatedSupport Activities Term Loan Prime plus2.75% 6/27/2041 545.6 542.4 513.8 0.25%^Island Time Investments, LLCdba Swantown Inn Bed &Breakfast Accommodation Term Loan Prime plus2.75% 6/24/2041 101.3 100.5 103.9 0.05%^Jumbomarkets Inc dba RinesJumbomarkets Food and BeverageStores Term Loan Prime plus2.75% 6/24/2026 50.0 48.5 40.8 0.02%^Yellow Cab Company ofKissimmee Inc Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 6/24/2041 56.8 56.4 53.2 0.03%^El Basha Inc dba RPM West SanFernando Valley Real Estate Term Loan Prime plus2.75% 6/24/2026 22.5 20.8 17.5 0.01%^Long Island Comedy LLC dbaGovernors and New YorkComedy, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/23/2041 187.5 186.2 184.4 0.09%^Visual Advantage LLC dba SignsNow Perryberg Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/23/2041 91.3 90.6 88.7 0.04%Shooting Sports Academy LLCand Jetaa LLC dba Shooting SportsAcademy Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/23/2041 375.0 375.0 370.9 0.18%^SNS of Central Alabama, LLCdba Steak N Shake Food Services andDrinking Places Term Loan Prime plus2.75% 6/21/2026 57.5 55.7 50.2 0.02%^Italian Heritage Tile and Stone Inc Specialty TradeContractors Term Loan Prime plus2.75% 6/20/2026 62.5 60.6 51.0 0.02%^Evergreen Investment & PropertyManagement LLC ,UniversalKidney Center Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/20/2041 1,250.0 1,243.2 1,261.1 0.60%^Bagelicious, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/17/2026 54.6 52.9 44.8 0.02%^T and B Boots Inc dba Takken'sShoes Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 6/17/2026 225.0 218.4 217.4 0.10%^NKJ Lusby Donuts LLC Food and BeverageStores Term Loan Prime plus2.75% 6/16/2026 22.5 21.8 18.4 0.01%F-108See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Winegirl Wines LLC Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 6/16/2026 11.3 10.9 10.9 0.01%^Blue Eagle Transport Inc,Greeneagle Transport Inc Couriers andMessengers Term Loan Prime plus2.75% 6/16/2026 583.0 560.1 471.5 0.23%^Jai-Alexia Consulting, Inc. Couriers andMessengers Term Loan Prime plus2.75% 6/15/2026 11.8 11.5 9.6 —%^Pumpkin Patch Child Care ofSouthington, LLC and GiuseppePugliares Social Assistance Term Loan Prime plus2% 6/15/2041 515.3 511.2 484.8 0.23%^Strag Industries LLC dba MeinekeCar Care Center 841 Repair andMaintenance Term Loan Prime plus2.75% 6/15/2026 15.0 14.5 13.3 0.01%^Luv 2 Play AZ LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/10/2026 62.5 60.6 58.5 0.03%^Refoleen Inc dba Spice and TeaExchange Food and BeverageStores Term Loan Prime plus2.75% 6/10/2026 85.0 83.9 70.7 0.03%^VBGB Uptown, LLC dba VBGBBeer Hall & Garden Food Services andDrinking Places Term Loan Prime plus2.75% 6/8/2026 84.0 81.4 68.5 0.03%^ScimTech Industries Inc dbaArcher Aerospace Computer andElectronic ProductManufacturing Term Loan Prime plus2.75% 6/6/2026 12.0 11.6 9.8 —%^Larry H. Patterson and RainbowMovers, Inc TruckTransportation Term Loan Prime plus2.75% 6/6/2026 22.5 21.8 18.5 0.01%^Solvit Inc and Solvit North Inc Specialty TradeContractors Term Loan Prime plus2.75% 6/3/2026 250.0 242.3 214.7 0.10%^AP5 LLC dba Krauser's FoodStore Food and BeverageStores Term Loan Prime plus2.75% 6/2/2041 242.5 240.8 239.1 0.11%^ATI Jet Inc Air Transportation Term Loan Prime plus2.75% 5/31/2026 518.8 499.9 441.7 0.21%^Farmer Boy Diner Inc dba FarmerBoy Diner & Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 5/31/2026 50.0 48.1 48.3 0.02%Angelo Faia dba AVF Construction Construction ofBuildings Term Loan Prime plus2.75% 5/27/2041 100.0 98.7 97.3 0.05%^Premier Athletic Center of Ohio,Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 5/27/2026 87.5 84.3 84.6 0.04%^MNM Printing and MarketingSolutions LLC dba AlphaGraphicsof Saint Louis Printing and RelatedSupport Activities Term Loan Prime plus2.75% 5/27/2026 18.8 18.1 15.2 0.01%^Mersada Holdings LLC Nonstore Retailers Term Loan Prime plus2.75% 5/26/2026 337.5 325.0 326.1 0.16%^Jack Frost Firewood Inc. andDavid Dubinsky Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 5/26/2041 206.3 204.5 200.1 0.10%F-109See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Southwest Division Inc Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 5/26/2026 8.3 7.9 7.1 —%^International Kitchen Supply LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 5/25/2026 186.8 179.8 160.3 0.08%^PennyLion LLC dba Creamistry Food Services andDrinking Places Term Loan Prime plus2.75% 5/25/2026 81.0 81.0 70.1 0.03%^Groth Lumber Co. Inc. dba TrueValue Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 5/25/2026 22.5 21.7 21.7 0.01%^Island Life Graphics Inc dbaFASTSIGNS #576 MiscellaneousManufacturing Term Loan Prime plus2.75% 5/24/2026 22.5 21.7 18.5 0.01%^Powerspec Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 5/24/2026 87.5 84.3 71.0 0.03%^Horseshoe Barbecue, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 5/23/2029 15.0 14.2 14.4 0.01%^Pro Auto Repair LLC Repair andMaintenance Term Loan Prime plus2.75% 5/20/2026 7.5 7.2 6.9 —%^Elderfriend Inc dba GrannyNannies dba GN Live Scan Social Assistance Term Loan Prime plus2.75% 5/20/2026 12.8 12.3 10.3 —%^CM Lab Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 5/20/2026 172.6 169.5 156.1 0.07%^National Air Cargo Holdings Inc Air Transportation Term Loan Prime plus2.75% 5/20/2026 1,250.0 1,205.2 1,174.9 0.56%^J&A Laundromat Inc. Personal andLaundry Services Term Loan Prime plus2.75% 5/18/2026 67.5 65.0 56.3 0.03%^HBA LLC dba Palmetto Twist-Vista Repair andMaintenance Term Loan Prime plus2.75% 5/18/2026 22.5 21.7 18.7 0.01%^Dedicated Incorporated Administrative andSupport Services Term Loan Prime plus2.75% 5/18/2041 46.5 46.1 45.9 0.02%^Studio Find It Georgia Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 5/13/2026 22.5 21.7 18.9 0.01%^FJN Catering Inc Food Services andDrinking Places Term Loan Prime plus2.75% 5/13/2041 262.5 260.7 266.9 0.13%^LED Lighting Enterprises LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 5/13/2026 22.5 21.7 18.8 0.01%^J. Harris Trucking, LLC TruckTransportation Term Loan Prime plus2.75% 5/13/2026 60.0 41.6 37.4 0.02%^Luv 2 Play OC Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 5/12/2026 62.5 62.5 52.6 0.03%F-110See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Pumpkin Patch Inc and ChristineFeliciano and Antonio Feliciano Social Assistance Term Loan Prime plus2.75% 5/12/2041 132.5 131.4 129.1 0.06%^The Delon Group LLC dba ILove Juice Bar Food Services andDrinking Places Term Loan Prime plus2.75% 5/12/2026 55.0 53.0 44.6 0.02%^Sabir Inc. dba Bear Diner Food Services andDrinking Places Term Loan Prime plus2.75% 5/11/2041 123.8 122.9 124.1 0.06%^Gator D'Lites LLC dba D'LitesEmporium Food and BeverageStores Term Loan Prime plus2.75% 5/5/2026 22.5 21.7 18.2 0.01%^Warner Home Comfort, LLC dbaSmith Piping Specialty TradeContractors Term Loan Prime plus2.75% 4/29/2041 82.5 81.7 80.4 0.04%^Keller, Fishback & Jackson LLP Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/29/2026 131.8 125.1 125.5 0.06%^Marc S. Rosenberg P.C. dbaMammuth and Rosenberg Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/29/2026 22.5 21.5 18.1 0.01%^May-Craft Fiberglass Products Inc TransportationEquipmentManufacturing Term Loan Prime plus2.75% 4/29/2041 247.5 245.0 253.3 0.12%^Alpha Omega Trucking LLC TruckTransportation Term Loan Prime plus2.75% 4/29/2041 175.8 174.7 180.6 0.09%^Scoler LLC dba Gold's Gym Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/29/2026 262.5 251.1 222.2 0.11%^Loriet LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 4/29/2026 7.5 7.2 6.1 —%^La Nopalera Mexicano 2, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 4/29/2026 125.5 123.0 123.5 0.06%^Euro Car Miami LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 4/29/2026 62.5 59.9 60.1 0.03%^Hard Exercise Works Winter ParkLLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/29/2026 40.8 39.0 32.8 0.02%^Empowerschool LLC andEmpower Autism Academy, LLC Social Assistance Term Loan Prime plus2.75% 4/29/2041 151.9 150.4 155.2 0.07%^Inner Beauty Salon and SuiteLLC Personal andLaundry Services Term Loan Prime plus2.75% 4/28/2041 65.0 64.4 65.8 0.03%^Atlantic Restaurant AssociatesLLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/28/2041 262.5 259.9 263.0 0.13%^Costume World Inc Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 4/28/2041 1,250.0 1,239.6 1,281.2 0.61%^Pecos Inn LLC dba Econo Lodge Accommodation Term Loan Prime plus2.75% 4/28/2041 677.5 670.8 678.0 0.32%F-111See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^North American ManufacturingCompany Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 4/28/2026 160.0 153.1 153.6 0.07%^Shepherd Appraisal Services LLCdba Property Damage Appraisers ofOklahoma Real Estate Term Loan Prime plus2.75% 4/28/2026 9.0 8.6 7.2 —%^Knowledge First Inc dba MagicYears of Learning Social Assistance Term Loan Prime plus2.75% 4/27/2026 80.0 76.5 71.8 0.03%^Green Country FilterManufacturing LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 4/27/2026 84.3 80.6 69.8 0.03%^Accent Comfort Services, LLC Specialty TradeContractors Term Loan Prime plus2.75% 4/26/2026 90.0 86.1 72.5 0.03%^Homecare Casa Rhoda 123 Inc Ambulatory HealthCare Services Term Loan Prime plus2% 4/26/2041 675.0 667.4 642.3 0.31%^McIntosh Trail ManagementServices Organization Inc Ambulatory HealthCare Services Term Loan Prime plus2.75% 4/22/2041 425.0 420.8 434.9 0.21%^Automotive Core Recycling, LLCand 828 Old Colony Road, LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 4/22/2041 250.0 247.5 234.1 0.11%^AAA Mill Direct, Inc. dba CarpetMill Outlets Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 4/21/2026 7.9 7.5 7.6 —%^Jande Graphics LLC dba FastSigns#103201 Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/21/2026 56.0 53.6 45.1 0.02%^Miguel Fernando Borda, P.A. dbaBGR Dental Ambulatory HealthCare Services Term Loan Prime plus2.75% 4/15/2026 22.5 21.5 18.7 0.01%^LE & JS dba Laredo Mercado YCarniceria Food and BeverageStores Term Loan Prime plus2.75% 4/13/2026 20.0 19.1 16.1 0.01%^Sushiya Inc Food Services andDrinking Places Term Loan Prime plus2.75% 4/12/2026 87.5 83.8 73.6 0.04%^Sierra Foothill Cremation &Funeral Service, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 4/7/2026 53.0 50.8 42.8 0.02%^Waterfalls Quick Lube LLC andVeracruz Shabo LLC Repair andMaintenance Term Loan Prime plus2.75% 4/6/2041 271.3 269.3 270.3 0.13%^KNS Early Learning AcademyLLC Social Assistance Term Loan Prime plus2.75% 4/6/2041 51.0 50.5 49.4 0.02%^Duke's Cleaners Inc Personal andLaundry Services Term Loan Prime plus2.75% 3/31/2026 47.0 44.7 41.0 0.02%^Cameo Carter, MD A ProfessionalCorporation Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/31/2026 75.0 71.3 60.0 0.03%^Farhad Brothers LLC dba Lulu'sPizzeria & Family Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 3/31/2026 66.8 59.6 50.1 0.02%^Christian Soderquist dbaSoderquist Plumbing and HeatingLLC Specialty TradeContractors Term Loan Prime plus2.75% 3/31/2041 56.8 56.1 57.7 0.03%F-112See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Vehicle Safety Supply LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 3/31/2026 22.5 21.4 18.0 0.01%^Men of Steel Enterprises LLC andVogelbacher Properties LLC Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 3/31/2041 393.5 389.0 362.2 0.17%^Gill Express Inc and Blue SpeedLLC Repair andMaintenance Term Loan Prime plus2.75% 3/31/2041 518.0 512.1 505.3 0.24%^Dana A. Farley dba IndependentCabinets Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 3/31/2041 67.5 66.7 68.9 0.03%^NOSO Development, LLC Construction ofBuildings Term Loan Prime plus2.75% 3/30/2026 187.5 178.2 149.9 0.07%^Wyldewood Cellars, Inc. Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 3/30/2041 986.8 985.8 936.7 0.45%^Gordon Rogers and Heidi Rogersdba Stone House Motor Inn Accommodation Term Loan Prime plus2.75% 3/30/2026 22.5 21.6 21.7 0.01%^Beale Street Blues Company-WestPalm Beach, LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 3/30/2026 93.8 89.1 77.1 0.04%^Tom Sawyer Country RestaurantLLC and AM 3208 LLC Food Services andDrinking Places Term Loan Prime plus2.75% 3/30/2041 257.5 254.6 258.5 0.12%^MTS Car Service LLC Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 3/30/2026 10.5 10.0 8.4 —%^Atlantis of Daytona LLC andPierre Mamane and Eva Mamane Clothing andClothing AccessoriesStores Term Loan Prime plus2% 3/29/2041 525.0 513.5 505.1 0.24%^Barrocas Gym LLC dba SnapFitness Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 3/29/2026 22.5 21.1 19.1 0.01%^Vinmar Inc. dba LocandaPortofino Food Services andDrinking Places Term Loan Prime plus2.75% 3/29/2026 81.3 77.2 65.0 0.03%^Lust for Life Footwear, LLC Leather and AlliedProductManufacturing Term Loan Prime plus2.75% 3/29/2026 375.0 356.4 299.9 0.14%^Marathon EngineeringCorporation MiscellaneousManufacturing Term Loan Prime plus2.75% 3/28/2041 45.0 44.5 44.7 0.02%^PHCDC1 LLC dba Quarter +Glory and Public House Collective,Corp. Food Services andDrinking Places Term Loan Prime plus2.75% 3/28/2026 50.0 47.5 42.5 0.02%^ReNew Interior Surface CleaningLLC dba Randy's Carpet Care andUpholstery Administrative andSupport Services Term Loan Prime plus2.75% 3/28/2026 12.4 11.8 11.5 0.01%^RCB Enterprises, Inc. Administrative andSupport Services Term Loan Prime plus2.75% 3/25/2026 56.3 53.5 45.0 0.02%^Revolution Physical Therapy LLCdba Apex Network PhysicalTherapy Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/25/2026 22.5 21.6 18.7 0.01%F-113See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Excel RP Inc MachineryManufacturing Term Loan Prime plus2.75% 3/25/2026 125.0 118.8 106.7 0.05%^Lowgap Grocery & Grill LLC GeneralMerchandise Stores Term Loan Prime plus2.75% 3/24/2041 167.5 165.6 171.1 0.08%^ActKnowledge, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 3/24/2026 125.0 118.8 119.1 0.06%^International Construction Inc Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 3/24/2041 50.0 49.5 48.4 0.02%^Flooring Liquidators Inc andPremier Flooring Yonkers Inc andFlooring Specialty TradeContractors Term Loan Prime plus2.75% 3/24/2026 50.0 47.5 46.2 0.02%^Acton Hardware LLC and MarkAllgood & Jamie Allgood Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 3/24/2041 498.6 492.9 472.6 0.23%^The Youth Fountain LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/23/2026 47.5 45.2 38.0 0.02%^Magnation Corporation andMisha Family Trust MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 3/22/2041 101.3 100.4 103.7 0.05%^growth.period LLC and PotomacRecruiting LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/21/2026 156.3 148.5 124.9 0.06%^Precious Care LLC and PreciousCare Management LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/21/2026 557.5 529.8 449.0 0.21%^Media Capital Partners, Inc Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 3/21/2026 22.5 21.4 18.0 0.01%^Pro Tech Technology LLC Support Activitiesfor Transportation Term Loan Prime plus2.75% 3/18/2026 7.5 7.1 6.0 —%^Taylors Zinn Enterprises Inc dbaEons Auto Care Inc Repair andMaintenance Term Loan Prime plus2.75% 3/18/2041 80.8 79.8 81.5 0.04%^ERT Group Inc and Curt's ToolsInspection Inc Support Activitiesfor Mining Term Loan Prime plus2.75% 3/18/2041 1,250.0 1,237.6 1,216.3 0.58%^Kekoa Enterprises Inc dbaSignarama Sandy Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/18/2026 49.5 47.0 39.6 0.02%^Mariam Diner Inc dba CountryKitchen Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 3/18/2026 52.5 49.9 42.0 0.02%^Brian T Rice dba BD Logging Forestry andLogging Term Loan Prime plus2.75% 3/17/2026 15.8 15.0 13.5 0.01%^Auto and Property InsuranceSolutions Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 3/16/2026 16.4 15.4 12.9 0.01%F-114See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Demand Printing Solutions Inc. Printing and RelatedSupport Activities Term Loan Prime plus2.75% 3/16/2026 21.8 20.7 19.5 0.01%^LAN Doctors Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/16/2026 55.0 52.3 52.4 0.03%^Evergreen Pallet LLC andEvergreen Recycle LLC Wood ProductManufacturing Term Loan Prime plus2.75% 3/16/2026 1,039.3 988.2 882.4 0.42%^K Soles Corp dba Max Collections MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 3/16/2026 22.5 21.4 18.0 0.01%^R & D Enterprises Inc dba MyPool Man Administrative andSupport Services Term Loan Prime plus2.75% 3/15/2026 50.0 47.5 40.0 0.02%^HEWZ, LLC dba Hard ExerciseWorks Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 3/14/2026 22.5 21.4 18.0 0.01%^Mustafa Inc and Raouf PropertiesLLC Food and BeverageStores Term Loan Prime plus2.75% 3/14/2041 75.0 74.1 75.4 0.04%^Country Paint and Hardware Inc Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 3/11/2026 87.4 83.0 71.5 0.03%^Wilban LLC Food Services andDrinking Places Term Loan Prime plus2.75% 3/11/2026 105.0 100.2 94.8 0.05%^ABCs & 123s Infant and ChildCare Center LP Social Assistance Term Loan Prime plus2.75% 3/11/2026 11.3 10.7 9.0 —%^Accuair Control Systems LLC dbaAccuair Suspension TransportationEquipmentManufacturing Term Loan Prime plus2.75% 3/11/2026 150.0 142.6 122.8 0.06%^Dupre Capital LLC dba Fastsigns MiscellaneousManufacturing Term Loan Prime plus2.75% 3/11/2026 58.4 55.5 46.7 0.02%^Magill Truck Line LLC and Jeff J.Ralls TruckTransportation Term Loan Prime plus2.75% 3/11/2029 210.8 203.6 183.0 0.09%^Fayette Computer ConsultingCompany Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/10/2026 22.5 21.4 18.9 0.01%^State Painting & Decorating Co.,Inc. Specialty TradeContractors Term Loan Prime plus2.75% 3/10/2026 103.8 98.6 83.0 0.04%^B.P.T.M. of NV LLC and AgentisBros., LLC Repair andMaintenance Term Loan Prime plus2.75% 3/9/2041 525.0 519.0 513.8 0.25%^Step Up Academy of the Arts LLC Educational Services Term Loan Prime plus2.75% 3/9/2026 8.0 7.6 6.4 —%^A & A Auto Care LLC Repair andMaintenance Term Loan Prime plus2.75% 3/9/2026 12.2 11.5 11.0 0.01%F-115See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Faith Summit Supply Inc dbaSummit Supply and Summit TrueValue Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 3/9/2026 22.5 21.4 19.4 0.01%^Swerve Salon LLC Personal andLaundry Services Term Loan Prime plus2.75% 3/8/2026 79.0 75.1 63.2 0.03%^J & W Hardwood Flooring Inc Specialty TradeContractors Term Loan Prime plus2.75% 3/7/2026 7.5 7.1 6.0 —%^Labmates LLC and POV HoldingsLLC Miscellaneous StoreRetailers Term Loan Prime plus2.75% 3/4/2041 109.3 108.0 111.6 0.05%^Hueston and Company CPA LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/4/2026 8.3 7.7 6.7 —%^Almost Home Daycare LLC Social Assistance Term Loan Prime plus2.75% 3/3/2026 50.0 47.5 46.3 0.02%^Miles of Smiles Inc Food Services andDrinking Places Term Loan Prime plus2.75% 3/2/2026 93.5 90.5 77.9 0.04%^Johnson & Dugan InsuranceServices Corp Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 2/28/2026 62.5 59.0 49.7 0.02%^Living Essentials HVAC Corp Specialty TradeContractors Term Loan Prime plus2.75% 2/28/2026 15.0 14.2 12.1 0.01%^Consulting Solutions, Inc. andMark Luciani Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 2/28/2026 11.3 10.6 10.4 —%^Doxa Deo Inc dba Luv 2 Play Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 2/28/2026 105.0 103.5 90.3 0.04%^The River Beas, LLC dba Subwayand Punam Singh Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2041 135.9 134.1 136.7 0.07%^Drug Detection Laboratories, Inc.and Minh Tran Ambulatory HealthCare Services Term Loan Prime plus2.75% 2/28/2026 19.8 18.7 16.0 0.01%^Powerpits CS1, LLC dba Pita Pit Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2026 18.8 17.7 15.8 0.01%^Blackstones Hairdressing LLC Personal andLaundry Services Term Loan Prime plus2.75% 2/23/2026 52.0 49.4 42.0 0.02%^Aaradhya LLC dba Market SquareLaundry Personal andLaundry Services Term Loan Prime plus2.75% 2/23/2026 80.0 75.5 63.5 0.03%^R-No-Landscaping LLC Personal andLaundry Services Term Loan Prime plus2.75% 2/19/2026 8.3 7.8 6.7 —%^BER Enterprise 332 Inc dbaEdible Arrangements Food and BeverageStores Term Loan Prime plus2.75% 2/19/2026 22.5 21.3 18.1 0.01%^R & K Contracting Inc Specialty TradeContractors Term Loan Prime plus2.75% 2/18/2026 15.8 15.0 14.5 0.01%F-116See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Pacific Coast Medical Group LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 2/17/2026 245.0 231.3 231.9 0.11%^B for Blonde, LLC dba Blo BlowDry Bar Personal andLaundry Services Term Loan Prime plus2.75% 2/12/2026 62.0 59.3 50.0 0.02%^Gilmore Heights Dental Holdings,LTD and Chas Rob LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 2/12/2029 310.3 298.6 272.7 0.13%^Ei3 Corporation Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 2/12/2026 326.9 308.6 309.5 0.15%^Jersey Shore Marina & BoatSales, Inc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 2/12/2041 625.0 617.7 638.2 0.31%^Base USA, Inc. Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 2/2/2026 50.0 47.2 47.4 0.02%^Nowatzke Service Center Inc dbaNowatzke Truck and Trailer Repair andMaintenance Term Loan Prime plus2.75% 1/29/2026 105.0 98.6 98.9 0.05%^Zouk Ltd dba Palma Food Services andDrinking Places Term Loan Prime plus2.75% 1/29/2026 22.5 21.1 21.2 0.01%^Tammy Lavertue Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 1/28/2026 11.3 10.5 10.2 —%^SuzyQue's LLC dba SuzyQue's Food Services andDrinking Places Term Loan Prime plus2.75% 1/28/2026 22.5 21.2 21.2 0.01%^Wildflour Bakery & Cafe LLC Social Assistance Term Loan Prime plus2.75% 1/28/2026 62.5 58.6 57.2 0.03%^New Image Building Services,Inc. Administrative andSupport Services Term Loan Prime plus2.75% 1/19/2026 83.1 78.0 69.1 0.03%^Oak Tree Storage LLC Other InformationServices Term Loan Prime plus2.75% 1/19/2026 78.8 73.8 63.4 0.03%^Gendron Funeral and CremationServices, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 1/11/2041 112.5 109.4 113.0 0.05%^Dolarian Realty LLC and OV'sRestaurant Inc Food Services andDrinking Places Term Loan Prime plus2.75% 1/5/2041 67.8 66.9 69.1 0.03%^Lemonberry Food Stores Inc dbaLemonberry Frozen Yogurt Food and BeverageStores Term Loan Prime plus2.75% 12/29/2025 112.5 104.8 91.8 0.04%^MCF Forte LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/29/2025 18.8 17.5 14.9 0.01%^Panditos LLC dba White LotusHome MiscellaneousManufacturing Term Loan Prime plus2.75% 12/28/2025 15.9 14.8 12.5 0.01%^Bright Dialysis LLC and Ft PierceKidney Care LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/28/2025 1,250.0 1,164.4 982.9 0.47%F-117See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^V2 Tango LLC dba Palette 22 Food Services andDrinking Places Term Loan Prime plus2.75% 12/23/2025 250.0 232.9 202.5 0.10%^Ridge Road Equestrian LLC dbaRicochet Ridge Ranch Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/23/2040 102.5 100.8 100.7 0.05%^800 on the Trax LLC and MatrixZ LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 12/23/2040 240.0 237.2 235.1 0.11%^Optima Health Care Inc Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/23/2025 62.5 58.2 58.4 0.03%^B&B Organics LLC Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 12/22/2040 375.0 368.9 381.0 0.18%^Joyce Outdoor AdvertisingChicago LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/22/2040 300.0 297.0 292.6 0.14%^The LAX Shop Inc Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 12/22/2025 125.0 91.4 91.6 0.04%^Premier Athletic Center of OhioInc. and Gates Investments andWade Gates Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/22/2028 882.0 840.0 848.3 0.41%^Hattingh Incorporated dbaProsthetic Care Facility Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/21/2025 18.0 16.8 14.9 0.01%^G.W. Fitness Centers, LLC andJ.G. Fitness LLC and NP Gym LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/18/2040 1,025.0 1,008.3 1,041.3 0.50%^Trip Consultants U.S.A. Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/18/2025 175.0 163.0 137.1 0.07%^Jay Kevin Gremillion dba DinoSmiles Children's CosmeticDentistry Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/18/2025 73.0 69.8 60.5 0.03%^Accent Tag and Label Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 12/18/2040 665.8 652.2 649.1 0.31%^Abbondanza Market LLC dbaHampton Falls Village Market Food and BeverageStores Term Loan Prime plus2.75% 12/18/2025 73.8 62.7 54.7 0.03%^Capital Scrap Metal LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/18/2025 36.0 33.5 28.7 0.01%^Labmates LLC Miscellaneous StoreRetailers Term Loan Prime plus2.75% 12/18/2040 162.5 159.9 165.1 0.08%^Sourceco Limited LiabilityCompany MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/17/2025 62.5 58.3 51.0 0.02%^Mustafa Inc dba Adiba Grocery Food and BeverageStores Term Loan Prime plus2.75% 12/17/2025 103.8 96.7 96.2 0.05%F-118See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Learning Skills LLC andChristopher Shrope Educational Services Term Loan Prime plus2.75% 12/17/2025 10.8 10.1 8.5 —%^New York Home Health CareEquipment, LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/16/2025 875.0 817.8 801.9 0.38%^Moments to Remember USA LLCdba Retain Loyalty Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/16/2025 75.0 70.0 65.3 0.03%^Swalm Sreet LLC and New YorkHome Health Care Equipment LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/16/2040 375.0 370.1 376.1 0.18%^JAG Unit 1, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 12/16/2025 250.0 233.3 196.2 0.09%^D&G Capital LLC dba MiamiGrill 277 Food Services andDrinking Places Term Loan Prime plus2.75% 12/16/2025 83.8 87.2 80.6 0.04%^Abitino's JFK LLC dba Abitino's Food Services andDrinking Places Term Loan Prime plus2.75% 12/16/2022 125.0 113.8 100.8 0.05%^SDA Holdings LLC and LesCheveux Salon Inc Personal andLaundry Services Term Loan Prime plus2.75% 12/15/2040 428.8 421.1 412.2 0.20%^Evans & Paul LLC and E&PHoldings I LLC Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 12/15/2025 125.0 116.4 101.5 0.05%^Basista Family Limited Partnershipand UPE, Inc. MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/14/2040 342.5 336.9 333.8 0.16%^DC Enterprises Ltd. dba LakeviewTrue Value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 12/14/2025 22.5 21.0 19.9 0.01%^Tri-State Remodeling &Investments, LLC Specialty TradeContractors Term Loan Prime plus2.75% 12/11/2025 15.9 14.8 14.3 0.01%^Alexandra Afentoulides dba Vi'sPizza Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 12/11/2040 46.3 45.5 47.0 0.02%^AGR Foodmart Inc dba NashuaRoad Mobil Gasoline Stations Term Loan Prime plus2.75% 12/11/2025 22.5 21.0 19.9 0.01%^ENI Inc. dba ENI Group, Inc Other InformationServices Term Loan Prime plus2.75% 12/11/2025 36.0 33.5 29.7 0.01%^Cares, Inc dba Dumpling GroundsDay Care Center Social Assistance Term Loan Prime plus2.75% 12/10/2025 7.5 7.0 6.9 —%^Custom Exteriors, Inc. Specialty TradeContractors Term Loan Prime plus2.75% 12/9/2025 100.0 93.2 81.5 0.04%^Sushiya, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 12/8/2025 108.8 101.3 88.9 0.04%^My Jewels, LLC dba The UPSStore #6712 Administrative andSupport Services Term Loan Prime plus2.75% 12/7/2025 56.3 33.2 27.9 0.01%^Food & Fuel Company LLC dbaLowery Food Mart Food and BeverageStores Term Loan Prime plus2.75% 12/4/2040 122.5 120.5 124.2 0.06%F-119See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Blue Ox Trucking Inc. TruckTransportation Term Loan Prime plus2.75% 12/4/2025 12.3 11.5 11.5 0.01%^LC Blvd Holdings LLC and MtPleasant Wash & Wax LLC Repair andMaintenance Term Loan Prime plus2.75% 12/4/2040 502.5 494.3 497.1 0.24%^American Campgrounds LLC dbaWhit's End Campground Accommodation Term Loan Prime plus2.75% 12/4/2040 293.0 288.2 290.4 0.14%^Tariq, LLC dba 76 Food Mart Gasoline Stations Term Loan Prime plus2.75% 12/2/2040 375.0 368.9 371.4 0.18%^401 JJS, Corp and G. Randazzo'sTrattoria Corporation Food Services andDrinking Places Term Loan Prime plus2.75% 12/1/2040 52.8 52.1 51.6 0.02%^Delta Aggregate, LLC Mining (except Oiland Gas) Term Loan Prime plus2.75% 11/30/2025 100.0 95.4 95.7 0.05%^Block and Grinder LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/30/2025 200.0 187.5 186.6 0.09%^Hurshell Leon Dutton dba HighJump Party Rentals Rental and LeasingServices Term Loan Prime plus2.75% 11/30/2025 17.6 16.2 16.0 0.01%^Japp Business Inc dba Pick andEat and Japp Drink Corp. Food Services andDrinking Places Term Loan Prime plus2.75% 11/30/2025 125.0 115.6 102.7 0.05%^Smokeyard Inc dba SmokeyardBBQ and Chop Shop Food Services andDrinking Places Term Loan Prime plus2.75% 11/30/2025 125.0 115.6 99.6 0.05%^Alejandro Rico dba Rico Motorsand Golden West Motel and AlrimaCo Inc Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 11/25/2040 146.3 143.9 148.4 0.07%^State Painting and Decorating CoInc Specialty TradeContractors Term Loan Prime plus2.75% 11/25/2025 100.0 92.5 77.8 0.04%^Medeiros Holdings Inc dbaOutdoor Lighting Perspectives ofthe Triad ElectricalEquipment,Appliance, andComponentManufacturing Term Loan Prime plus2.75% 11/25/2025 22.5 20.7 17.4 0.01%^DWeb Studio, Inc. Educational Services Term Loan Prime plus2.75% 11/25/2025 11.3 10.4 8.7 —%^Sambella Holdings, LLC andStrike Zone Entertainment CenterLLC Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 11/23/2040 750.0 747.7 764.6 0.37%^Play and Learn Child Care andSchool Inc Social Assistance Term Loan Prime plus2.75% 11/23/2025 11.1 10.3 10.3 —%^Ronny Ramirez RX Corp dbaNaturxheal Family Pharmacy Health and PersonalCare Stores Term Loan Prime plus2.75% 11/20/2025 89.0 83.4 71.7 0.03%^Haven Hospitality Group Inc. dbaHaven Gastropub Food Services andDrinking Places Term Loan Prime plus2.75% 11/20/2025 132.5 122.6 105.2 0.05%^CNYP 717 Irondequoit LLC andCNYP 2002 Ontario LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/20/2040 244.4 240.0 224.7 0.11%F-120See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^S.B.B. Enterprises Inc dbaWilliamston Hardware Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/19/2040 108.8 106.6 100.1 0.05%^Key Pix Productions Inc. dba AirBud Entertainment Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 11/18/2040 839.8 824.8 851.8 0.41%^Holloway & CO. P.L.L.C. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/16/2025 75.0 69.4 69.5 0.03%^RDT Enterprises, L.L.C. Specialty TradeContractors Term Loan Prime plus2.75% 11/12/2025 22.5 20.8 19.5 0.01%^E.S.F.P. LLC dba Volusia Vanand Storage TruckTransportation Term Loan Prime plus2.75% 11/11/2025 91.3 84.4 72.8 0.03%^Green Life Lawnscapes LLC dbaGreen Life Lawn Care Administrative andSupport Services Term Loan Prime plus2.75% 11/6/2025 127.3 117.7 114.7 0.05%^Joseph Nich and Tina M. Nichdba Vic's Greenhouses Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/4/2025 62.5 58.2 58.3 0.03%^Jumbomarkets Inc dba RinesJumbomarkets Food and BeverageStores Term Loan Prime plus2.75% 11/4/2025 306.3 283.3 274.8 0.13%^Bisson Transportation Inc dba I& R Associates and DocumentSecutiry TruckTransportation Term Loan Prime plus2.75% 10/30/2025 22.5 20.7 19.4 0.01%^Top Cat Ready Mix, LLC, PlesInvestments LLC Specialty TradeContractors Term Loan Prime plus2.75% 10/28/2025 711.3 653.6 572.5 0.27%^L.M. Jury Enterprises, Inc dbaMidwest Monograms Textile ProductMills Term Loan Prime plus2.75% 10/28/2025 77.0 70.6 60.8 0.03%^Windsor Direct Distribution LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 10/26/2025 14.3 13.0 11.0 0.01%^Financial Network Recovery Administrative andSupport Services Term Loan Prime plus2.75% 10/26/2025 40.0 36.8 30.9 0.01%^Insurance Fire & WaterRestorations, LLC Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 10/23/2025 22.5 20.7 19.6 0.01%^Jacksonville Beauty Institute Inc. EducationalServices Term Loan Prime plus2.75% 10/23/2025 50.0 45.9 38.6 0.02%^Werthan Packaging Inc. PaperManufacturing Term Loan Prime plus2.75% 10/14/2025 1,162.5 1,104.0 1,030.3 0.49%^Tannehill Enterprises Inc dbaHobbytown USA Folsom Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 10/14/2025 87.4 80.2 67.5 0.03%^ADMO Inc dba Mid StatesEquipment Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 10/8/2025 22.5 20.7 17.9 0.01%F-121See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^SCJEN Management Inc dba Bowlof Heaven Food Services andDrinking Places Term Loan Prime plus2.75% 9/30/2025 71.3 65.7 55.2 0.03%^Naeem Khan LTD ApparelManufacturing Term Loan Prime plus2.75% 9/30/2025 125.0 114.0 95.8 0.05%^Accent Homes Services LLC dbaBenjamin Franklin Plumbing ofKansas City Specialty TradeContractors Term Loan Prime plus2.75% 9/30/2028 66.5 62.4 60.4 0.03%^Recycling Consultants, Inc. andPrairie State Salvage and Recycling MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/30/2027 767.5 714.8 643.3 0.31%^Barub Realty LLC and Barub LLCdba Woodlawn Cabinets Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 9/30/2040 143.0 140.0 143.9 0.07%^R.H. Hummer Jr., Inc. TruckTransportation Term Loan Prime plus2.75% 9/30/2025 375.0 354.3 338.4 0.16%^Bat Bridge Investments Inc dbaKalologie 360 Spa Personal andLaundry Services Term Loan Prime plus2.75% 9/30/2025 85.5 79.5 66.8 0.03%^Binky's Vapes LLC Miscellaneous StoreRetailers Term Loan Prime plus2.75% 9/30/2025 22.5 20.5 17.2 0.01%^Joyce Outdoor Advertising LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/29/2040 234.8 231.0 235.0 0.11%^Greensward of Marco Inc. Administrative andSupport Services Term Loan Prime plus2.75% 9/28/2040 87.5 85.7 84.4 0.04%^RIM Investments LLC and RIMArchitects LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/28/2040 399.0 390.7 383.0 0.18%^The Grasso Companies LLC andGrasso Pavement Maintenance LLC Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 9/28/2025 518.8 469.8 469.2 0.22%^South Towne Dental Center, P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/25/2025 50.0 45.6 45.7 0.02%^Hemingway Custom CabinetryLLC Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 9/25/2025 220.0 200.6 172.8 0.08%^Daniel W. Stark dba MountainValley Lodge and RV Park Accommodation Term Loan Prime plus2.75% 9/25/2040 13.5 13.2 13.6 0.01%^Sandlot Ventures LLC andSandbox Ventures LLC Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 9/25/2040 442.5 433.9 418.9 0.20%^Yachting Solutions LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 9/25/2040 962.5 942.4 908.0 0.43%^Prestigious LifeCare for SeniorsLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/25/2025 9.8 9.0 8.2 —%^St Lawrence Hotel Corp andOheka Catering Inc dba QualityInn Accommodation Term Loan Prime plus2.75% 9/24/2040 625.0 611.9 608.5 0.29%F-122See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Hagerstown Muffler, Inc. and JMSMuffler, Inc Repair andMaintenance Term Loan Prime plus2.75% 9/24/2040 327.5 320.7 331.0 0.16%^J.R. Wheeler Corporation dbaStructurz Exhibits and Graphics Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 10/24/2025 21.0 19.2 19.2 0.01%^Rutledge Enterprises Inc dba BLCProperty Management Administrative andSupport Services Term Loan Prime plus2.75% 9/23/2040 62.5 60.7 60.4 0.03%^Finish Strong Inc dbaFASTSIGNS St Peters MiscellaneousManufacturing Term Loan Prime plus2.75% 9/23/2025 50.0 45.6 38.3 0.02%^J3K LLC dba Ronan True ValueHardware Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 9/23/2025 152.5 139.1 116.9 0.06%^Stormrider Inc dba Shirley'sStormrider Inc TruckTransportation Term Loan Prime plus2.75% 9/23/2025 67.5 62.6 52.6 0.03%^Frozen Treats of Hollywood FL,LLC dba Sub Zero Ice Cream Food Services andDrinking Places Term Loan Prime plus2.75% 9/22/2025 15.8 14.4 12.8 0.01%^Nova Solutions Inc Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 9/22/2040 320.0 313.3 311.9 0.15%^Pine Belt Wood Products LLC Forestry andLogging Term Loan Prime plus2.75% 9/22/2040 163.8 160.3 146.9 0.07%^IIoka Inc dba New CloudNetworks Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/21/2025 665.0 609.3 512.1 0.24%^Sound Manufacturing Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/21/2025 50.0 45.6 40.6 0.02%^MiJoy Inc dba Imo's Pizza Food Services andDrinking Places Term Loan Prime plus2.75% 9/18/2025 8.3 7.5 6.3 —%^Vanderhoof LLC dba Soxfords ApparelManufacturing Term Loan Prime plus2.75% 9/18/2025 15.9 14.5 12.2 0.01%^Naeem Khan LTD ApparelManufacturing Term Loan Prime plus2.75% 9/17/2025 125.0 114.0 95.8 0.05%^Import Car Connection Inc dbaCar Connection Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 9/16/2040 407.5 399.0 406.5 0.19%^FirstVitals Health and Wellness Inc MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/15/2025 150.0 136.8 114.9 0.05%^Johnson Carwash LLC andJohnson Petroleum LLC Gasoline Stations Term Loan Prime plus2.75% 9/14/2040 340.0 334.8 345.1 0.17%^Almost Home Daycare LLC Social Assistance Term Loan Prime plus2.75% 9/11/2025 62.5 57.0 56.3 0.03%^Veliu LLC dba FASTSIGNS#15901 MiscellaneousManufacturing Term Loan Prime plus2.75% 9/10/2025 50.0 46.2 40.0 0.02%F-123See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^B and A Friction Materials Inc MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/9/2025 102.5 92.7 77.9 0.04%^Gardner's Wharf Holdings LLCand Gardner's Wharf Seafood Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 9/8/2040 140.0 137.1 141.5 0.07%^AIG Inc Specialty TradeContractors Term Loan Prime plus2.75% 9/4/2040 363.8 356.1 338.8 0.16%^Empower Autism Academy Social Assistance Term Loan Prime plus2.75% 9/4/2040 685.0 670.7 692.4 0.33%^Higher Grounds CommunityCoffeehouse, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/2/2025 8.3 7.5 6.6 —%^Delray Scrap Recycling LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 8/31/2025 22.5 20.1 16.9 0.01%^The Camera House Inc MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 8/31/2025 1,250.0 1,131.6 1,036.9 0.50%^LAN Doctors Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/28/2025 81.3 73.6 66.8 0.03%^Elite Institute LLC dbaHuntington Learning Center EducationalServices Term Loan Prime plus2.75% 8/28/2025 15.0 13.7 11.6 0.01%^Zephyr Seven Series LLC dba18/8 Fine Men's Salon Personal andLaundry Services Term Loan Prime plus2.75% 8/28/2025 81.3 76.2 65.7 0.03%^J and K Fitness L.L.C. dbaPhysiques Womens Fitness Center Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 2/28/2041 93.8 92.7 93.5 0.04%^Trading Group 3 Inc Nonstore Retailers Term Loan Prime plus2.75% 8/28/2025 50.0 45.3 38.0 0.02%^B and J Catering Inc dba CulinarySolutions Food Services andDrinking Places Term Loan Prime plus2.75% 8/27/2040 547.5 540.3 523.4 0.25%^God Be Glorified Inc dba GBGInc Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 8/20/2025 53.0 48.0 40.3 0.02%^3000 CSI Property LLC andConsulting Solutions Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/20/2040 137.5 134.4 136.7 0.07%^GDP Gourmet LLC dba Joe andJohn's Pizza Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 8/19/2040 145.0 141.7 140.1 0.07%^Screenmobile Management Inc Specialty TradeContractors Term Loan Prime plus2.75% 8/14/2025 47.0 42.5 36.1 0.02%^Gold Jet Corp. Couriers andMessengers Term Loan Prime plus2.75% 8/14/2025 68.3 65.3 59.2 0.03%^SKJ Inc dba Subway Food Services andDrinking Places Term Loan Prime plus2.75% 8/13/2025 84.8 76.8 65.5 0.03%F-124See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^LP Industries Inc dba Childforms Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 7/29/2025 125.0 114.5 107.0 0.05%^Advanced Machine &Technology, Inc. Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 7/29/2025 90.3 81.1 74.8 0.04%^Pauley Tree and Lawn Care Inc Administrative andSupport Services Term Loan Prime plus2.75% 7/28/2025 65.8 59.2 53.0 0.03%^Beale Street Blues Company-WestPalm Beach LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 7/24/2025 66.3 59.5 52.2 0.02%^Forever & Always of Naples Incdba Island Animal Hospital Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 7/24/2025 107.5 96.6 88.0 0.04%^C& D Medical of Naples, Inc andForever & Always of Naples, Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 7/24/2040 135.0 131.8 123.2 0.06%^Pooh's Corner Realty LLC andPooh's Corner Inc Social Assistance Term Loan Prime plus2.75% 7/23/2040 103.8 101.4 103.8 0.05%^Smart Artists Inc. Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 7/23/2025 22.5 20.2 17.0 0.01%^Free Ion Advisors LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 7/21/2025 64.3 57.7 48.5 0.02%^Murrayville Donuts, Inc dbaDunkin' Donuts Food and BeverageStores Term Loan Prime plus2.75% 7/15/2040 344.5 340.4 329.4 0.16%^Union 2 LLC dba The Standard Food Services andDrinking Places Term Loan Prime plus2.75% 7/10/2025 91.5 85.9 79.1 0.04%^The Smile Place LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/30/2040 283.9 276.6 282.4 0.14%^BJ's Tavern LLC and BJ's CabanaBar Inc Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2040 212.5 207.1 210.9 0.10%^Jonathan E Nichols and NicholsFire and Security LLC Administrative andSupport Services Term Loan Prime plus2.75% 6/30/2025 75.0 66.9 65.2 0.03%^Thrifty Market, Inc. dba ThriftyFoods Food and BeverageStores Term Loan Prime plus2.75% 6/30/2030 262.5 246.5 231.3 0.11%^All About Smiles P A Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/30/2040 237.7 231.6 236.4 0.11%^Danny V, LLC dba Hugo'sTaproom Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2040 54.0 50.1 49.0 0.02%^Anglin Cultured Stone ProductsLLC dba Anglin Construction Specialty TradeContractors Term Loan Prime plus2.75% 6/30/2025 281.8 251.3 232.6 0.11%^Advanced Skincare Medcenter Incdba Advanced Skincare Surgery Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/29/2025 337.5 301.0 273.0 0.13%F-125See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Summit Beverage Group LLC Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 8/29/2030 291.9 274.4 261.4 0.13%^Myclean Inc. Personal andLaundry Services Term Loan Prime plus2.75% 6/29/2025 15.9 14.2 12.7 0.01%^E & G Enterprises LLC dbaComfort Keepers Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/26/2025 22.5 20.1 18.0 0.01%^SofRep, Inc dba Force 12 Media Other InformationServices Term Loan Prime plus2.75% 6/26/2025 66.3 59.1 52.9 0.03%^Jihan Inc dba ARCO AM/PM andDiana Inc dba Diana's Recycling Gasoline Stations Term Loan Prime plus2.75% 6/26/2040 380.0 370.3 374.9 0.18%^TJU-DGT Inc dba The LorenzCafe Food Services andDrinking Places Term Loan Prime plus2.75% 6/26/2029 20.6 19.2 19.5 0.01%^CEM Autobody LLC dba Dawn'sAutobody Repair andMaintenance Term Loan Prime plus2.75% 6/26/2040 135.5 132.0 132.6 0.06%^Wolf Enviro Interests, LLC andEnviromax Services Inc Administrative andSupport Services Term Loan Prime plus2.75% 6/25/2040 246.5 240.2 234.0 0.11%^Ohs Auto Body, Inc. dba OhsBody Shop Repair andMaintenance Term Loan 7.28% 6/25/2040 1,207.5 1,187.4 1,190.9 0.57%^Evinger PA One, Inc. dba PostalAnnex, Falcon Miscellaneous StoreRetailers Term Loan Prime plus2.75% 6/24/2025 22.5 20.1 18.8 0.01%^Amboy Group, LLC dbaTommy's Moloney's Food Manufacturing Term Loan Prime plus2.75% 6/24/2025 454.0 406.2 410.1 0.20%^Richards Plumbing and HeatingCo., Inc. dba Richards Mechanical Specialty TradeContractors Term Loan Prime plus2.75% 6/23/2040 551.8 537.6 561.8 0.27%^RJI Services, Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/23/2025 22.5 19.9 17.8 0.01%^Real Help LLC dba Real HelpDecorative Concrete Administrative andSupport Services Term Loan Prime plus2.75% 6/22/2025 53.1 47.4 47.1 0.02%^PM Cassidy Enterprises, Inc. dbaJunk King Waste Managementand RemediationServices Term Loan Prime plus2.75% 6/19/2025 14.9 13.3 11.9 0.01%^KRN Logistics, LLC,NewsomeTrucking, Inc TruckTransportation Term Loan Prime plus2.75% 6/19/2025 543.5 484.8 458.5 0.22%^Inverted Healthcare Staffing ofFlorida LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/18/2025 61.3 54.7 49.0 0.02%^Square Deal SidingCompany,LLC dba Square DealSiding Company Specialty TradeContractors Term Loan Prime plus2.75% 6/18/2025 22.5 20.4 20.6 0.01%^Flooring Liquidators Inc andFlooring Liquidators of Mt KiscoLLC Specialty TradeContractors Term Loan Prime plus2.75% 6/17/2025 437.5 390.2 390.4 0.19%^AM PM Properties, LLC and AMPM Willington, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/17/2040 87.1 84.6 87.5 0.04%F-126See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Nelson Sargsyan dba HDATrucking Support Activitiesfor Transportation Term Loan Prime plus2.75% 6/16/2025 130.5 117.0 104.7 0.05%^Mirage Plastering Inc and MpireLLC and Mpire II LLC Specialty TradeContractors Term Loan Prime plus2.75% 6/12/2040 338.8 135.2 128.3 0.06%^Bizzare Foods Inc dba TrooperFoods MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 6/12/2025 125.0 108.7 97.3 0.05%^Anturio Marketing Inc dba LogicConsulting Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/12/2040 290.3 282.8 295.5 0.14%^Eldredge Tavern LLC dbaGonyea's Tavern Food Services andDrinking Places Term Loan Prime plus2.75% 6/8/2040 56.3 54.8 57.3 0.03%^Nicor LLC dba FibrenewSacramento Repair andMaintenance Term Loan Prime plus2.75% 6/5/2022 13.8 11.4 10.2 —%^Chitalian Fratelli LLC dbaFrancesca Brick Oven Pizza andPasta Food Services andDrinking Places Term Loan Prime plus2.75% 6/5/2025 16.1 14.0 12.5 0.01%^ViAr Visual Communications, Inc.dba Fastsigns 281701 MiscellaneousManufacturing Term Loan Prime plus2.75% 6/5/2025 62.0 55.3 50.4 0.02%^Video Vault & Tanning LLC andMosaic Salon LLC Rental and LeasingServices Term Loan Prime plus2.75% 6/4/2040 90.5 88.4 92.3 0.04%^Medworxs LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/3/2025 125.0 111.5 100.4 0.05%^DTM Parts Supply Inc. MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 6/2/2025 62.8 56.0 50.1 0.02%^XCESSIVE THROTTLE, INC dbaJake's Roadhouse Food Services andDrinking Places Term Loan Prime plus2.75% 5/29/2025 8.3 7.3 6.5 —%^God is Good LLC dba BurgerFi Food Services andDrinking Places Term Loan Prime plus2.75% 5/27/2025 67.3 16.6 16.7 0.01%^Villela CPA PL Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 5/27/2025 9.0 8.0 7.3 —%^Pen Tex Inc dba The UPS Store Administrative andSupport Services Term Loan Prime plus2.75% 5/20/2025 22.0 19.5 17.5 0.01%^Douglas Posey and SallyWatkinson dba Audrey's Farmhouse Accommodation Term Loan Prime plus2.75% 5/20/2040 174.1 169.4 173.9 0.08%^Capstone Pediatrics PLLC andCapstone Healthcare ConsultingLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 5/15/2025 717.3 638.0 581.7 0.28%^15 McArdle LLC and No OtherImpressions Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 5/15/2040 257.1 250.1 247.5 0.12%^E-Z Box Storage, Inc. Real Estate Term Loan Prime plus2.75% 5/11/2025 89.3 73.3 74.0 0.04%F-127See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Guard Dogs MFS LLC Repair andMaintenance Term Loan Prime plus2.75% 5/8/2025 65.0 57.5 51.8 0.02%^George S Cochran DDS Inc Ambulatory HealthCare Services Term Loan Prime plus2.75% 5/7/2025 130.0 115.5 103.6 0.05%^South Park Properties LLC andMidlothian Hardware LLC Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 5/6/2040 170.5 164.8 172.1 0.08%^Matthew Taylor and Landon FarmLLC Personal andLaundry Services Term Loan Prime plus2.75% 5/4/2040 100.0 98.0 93.7 0.04%^Cares Inc dba Dumpling GroundsDay Care Center Social Assistance Term Loan Prime plus2.75% 5/1/2040 81.9 78.8 82.4 0.04%^RDRhonehouse ENT. LLC dbaChill Skinz Miscellaneous StoreRetailers Term Loan Prime plus2.75% 4/29/2025 88.9 79.8 71.5 0.03%^Orchid Enterprises Inc dbaAssisting Hands of Sussex County Ambulatory HealthCare Services Term Loan Prime plus2.75% 4/24/2025 15.0 13.2 11.8 0.01%^Ragazza Restaurant Group, Inc.dba Bambolina Food Services andDrinking Places Term Loan Prime plus2.75% 4/21/2025 22.5 19.8 18.3 0.01%^Diamond Solutions LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 4/21/2025 22.5 19.3 17.3 0.01%^Giacchino Maritime ConsultantsInc Personal andLaundry Services Term Loan Prime plus2.75% 4/17/2025 22.5 19.8 17.7 0.01%^Sound Coaching Inc Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 4/14/2025 44.4 39.0 34.9 0.02%^Carolina Beefs, LLC dba BeefO'Brady's Food Services andDrinking Places Term Loan Prime plus2.75% 4/13/2025 19.5 17.1 15.3 0.01%^Faramarz Nikourazm dba CarClinic Center Repair andMaintenance Term Loan Prime plus2.75% 4/3/2040 73.8 71.5 72.3 0.03%^Advance Case Parts RE HoldingsLLC and Advance Case Parts Inc Repair andMaintenance Term Loan Prime plus2.75% 3/31/2040 758.3 737.4 723.8 0.35%^T and B Boots Inc dba Takkens Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 3/31/2025 807.8 705.6 688.1 0.33%^HAVANA CENTRAL NJ1, LLCdba Havana Central Food Services andDrinking Places Term Loan Prime plus2.75% 3/31/2025 250.0 225.0 225.6 0.11%^Mid-South Lumber Co. ofNorthwest Florida, Inc. MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 3/31/2040 428.8 415.7 406.4 0.19%^Copper Beech Financial GroupLLC Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 3/30/2025 125.0 109.0 103.4 0.05%F-128See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Delta Aggregate LLC Mining (except Oiland Gas) Term Loan Prime plus2.75% 3/30/2025 90.0 83.7 84.5 0.04%^Sunset Marine Resort LLC andGoXpeditions LLC Accommodation Term Loan Prime plus2.75% 3/27/2040 301.8 292.6 305.6 0.15%^Shorr Enterprises Inc dba NewDesign Furniture Manufacturers Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 3/27/2025 106.5 92.9 89.1 0.04%^South Florida Air Conditioningand Refrigeration Corp. Specialty TradeContractors Term Loan Prime plus2.75% 3/27/2040 155.5 150.8 155.8 0.07%^Shellhorn and Hill Inc dba TotalFleet Service Nonstore Retailers Term Loan Prime plus2.75% 3/27/2040 1,040.3 1,004.8 982.4 0.47%^Foresite Realty Partners LLC andForesite Real Estate Holdings LLC Real Estate Term Loan Prime plus2.75% 3/27/2025 1,238.3 1,079.5 965.3 0.46%^Geo Los Angeles LLC dba GeoFilm Group Rental and LeasingServices Term Loan Prime plus2.75% 3/26/2025 130.0 113.4 108.2 0.05%^Joyce Outdoor Advertising NJLLC and Joyce OutdoorAdvertising LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/26/2040 54.0 52.4 54.2 0.03%^Zero-In Media Inc Data Processing,Hosting, and RelatedServices Term Loan Prime plus2.75% 3/25/2025 22.5 19.6 17.5 0.01%^Carpet Exchange of North TexasInc and Clyde E. Cumbie Jr Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 3/25/2040 810.0 785.4 816.3 0.39%^Loriet LLC MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 3/24/2025 12.0 10.5 9.4 —%^Shelton Incorporated dba Mrs.Winners Food Services andDrinking Places Term Loan Prime plus2.75% 3/20/2040 112.5 109.1 113.6 0.05%^Jaymie Hazard dba Indigo HairStudio and Day Spa Personal andLaundry Services Term Loan Prime plus2.75% 3/20/2040 42.9 41.6 41.9 0.02%^R & R Security and InvestigationsInc dba Pardners Lake Buchanan Food Services andDrinking Places Term Loan Prime plus2.75% 3/19/2040 85.4 82.9 86.5 0.04%^MMS Realty, LLC and MolecularMS Diagnostics LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/18/2040 160.7 155.8 156.1 0.07%^Royal Crest Motors LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 3/16/2040 91.3 88.5 89.8 0.04%^BND Sebastian Limited LiabilityCompany and Sebastian Fitness Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 3/16/2040 172.5 167.3 171.6 0.08%^Douglas Printy Motorsports, Inc.dba Blackburn Trike Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 3/9/2040 191.8 185.9 186.2 0.09%^Luigi's on Main LLC and Luigi'sMain Street Pizza Inc Food Services andDrinking Places Term Loan Prime plus2.75% 3/4/2025 11.3 9.8 9.9 —%F-129See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Calhoun SatelliteCommunications Inc andTransmission Solutions Group Broadcasting(except Internet) Term Loan Prime plus2.75% 2/27/2025 952.8 825.3 763.2 0.37%^Road to Sedona Inc dba Thirteen Food Services andDrinking Places Term Loan Prime plus2.75% 2/27/2025 56.6 49.0 44.3 0.02%^Baystate Firearms and Training,LLC Educational Services Term Loan Prime plus2.75% 2/27/2025 63.4 54.7 49.3 0.02%^Kingseal LLC dba Desoto Healthand Rehab Center Nursing andResidential CareFacilities Term Loan Prime plus2.75% 2/26/2040 1,250.0 1,210.1 1,263.9 0.60%^Pace Motor Lines, Inc. TruckTransportation Term Loan Prime plus2.75% 2/26/2025 66.2 57.3 57.8 0.03%^Nelson Financial Services LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 2/24/2025 12.5 10.8 9.6 —%^Kiddie Steps 4 You Inc. Social Assistance Term Loan Prime plus2.75% 2/19/2040 61.8 59.7 59.6 0.03%^Triangle Trash LLC dba BinThere Dump That Waste Managementand RemediationServices Term Loan Prime plus2.75% 2/18/2025 74.4 64.3 60.6 0.03%^Silva Realty Holdings, LLC andMF-Silva Enterprises, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 2/11/2040 171.6 166.3 166.0 0.08%^740 Barry Street Realty LLC andWild Edibles Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 2/10/2040 492.5 476.7 498.0 0.24%^Kostekos Inc dba New York StylePizza Food Services andDrinking Places Term Loan Prime plus2.75% 2/6/2040 66.3 64.1 64.8 0.03%^DuCharme Realty LLC andDuCharme Enterprises LLC Wood ProductManufacturing Term Loan Prime plus2.75% 2/2/2040 225.1 217.9 215.7 0.10%^Limameno LLC dba Sal's ItalianRistorante Food Services andDrinking Places Term Loan Prime plus2.75% 1/23/2025 83.3 71.4 65.4 0.03%^Palmabak Inc dba Mami Nora's Food Services andDrinking Places Term Loan Prime plus2.75% 1/22/2025 21.5 15.9 16.1 0.01%^Jung Design Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 1/20/2022 8.4 6.5 5.8 —%^Grand Blanc Lanes, Inc. and H, Hand H, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/31/2039 133.0 128.5 133.0 0.06%^Bear Creek Entertainment, LLCdba The Woods at Bear Creek Accommodation Term Loan Prime plus2.75% 12/30/2024 106.3 90.7 91.4 0.04%^Evans and Paul LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/30/2024 223.8 190.5 188.1 0.09%^FHJE Ventures LLC andEisenreich II Inc dba BreakneckTavern Food Services andDrinking Places Term Loan Prime plus2.75% 12/30/2039 245.5 238.2 234.6 0.11%F-130See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^First Prevention and DialysisCenter, LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/30/2024 273.3 248.4 241.4 0.12%^Bowlerama Inc Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 12/24/2039 1,202.5 1,161.9 1,213.0 0.58%^401 JJS Corporation and G.Randazzo Corporation Food Services andDrinking Places Term Loan Prime plus2.75% 12/23/2039 473.5 460.9 473.5 0.23%^The Lodin Group LLC and LodinHealth Imaging Inc dba HighlandsBreast Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/23/2039 530.3 511.6 500.9 0.24%^Thermoplastic Services Inc andParagon Plastic Sheet, Inc Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 12/23/2039 500.0 482.4 503.6 0.24%^Carolina Flicks Inc dba TheHowell Theater Motion Picture andSound RecordingIndustries Term Loan Prime plus2.75% 12/23/2032 163.3 153.0 151.0 0.07%^Atlantis of Daytona LLC andOcean Club Sportswear Inc Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 12/23/2039 240.0 214.8 224.3 0.11%^Beale Street Blues Company-WestPalm Beach, LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 12/22/2024 187.5 159.6 148.4 0.07%^MM and M Management Inc dbaPizza Artista Food Services andDrinking Places Term Loan Prime plus2.75% 4/19/2025 46.3 40.4 36.7 0.02%^The Jewelers Inc. dba TheJewelers of Las Vegas Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 12/19/2024 1,250.0 1,063.3 959.5 0.46%^B.S. Ventures LLC dba Dink'sMarket MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/19/2039 53.8 51.9 54.1 0.03%^B & W Towing, LLC andBoychucks Fuel LLC Repair andMaintenance Term Loan Prime plus2.75% 12/17/2039 164.5 160.0 159.4 0.08%^All American Games, LLC andSportslink - The Game, LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 12/10/2024 400.0 340.4 318.1 0.15%^Kemmer LLC and Apples TreeTop Liquors LLC Food and BeverageStores Term Loan Prime plus2.75% 12/4/2039 138.4 133.5 131.8 0.06%^Trading Group 3, Inc. Miscellaneous StoreRetailers Term Loan Prime plus2.75% 11/26/2024 22.5 19.0 17.0 0.01%^The Red Pill Management, Inc.dba UFC Gym Matthews Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 11/26/2024 54.3 46.6 43.2 0.02%^Teamnewman Enterprises LLCdba Newmans at 988 and John H.Newman Food Services andDrinking Places Term Loan Prime plus2.75% 11/25/2039 148.8 143.3 143.9 0.07%^DeRidder Chiropractic LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/25/2024 13.2 11.1 11.2 0.01%F-131See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Modern Manhattan LLC Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 11/25/2024 220.0 185.8 167.8 0.08%^Stormrider Inc dba Shirley'sStormrider, Inc TruckTransportation Term Loan Prime plus2.75% 11/25/2024 150.0 129.1 115.3 0.06%^Meridian Hotels, LLC dba BestWestern Jonesboro Accommodation Term Loan Prime plus2.75% 11/25/2039 228.0 220.6 230.3 0.11%^Legacy Estate Planning Inc dbaAmerican Casket Enterprises Personal andLaundry Services Term Loan Prime plus2.75% 11/21/2024 42.0 35.5 31.7 0.02%^J&D Resources, LLC dba AquaScience Specialty TradeContractors Term Loan Prime plus2.75% 11/21/2024 767.9 641.4 582.5 0.28%^DC Real LLC and DC EnterprisesLTD dba Lakeview True Value Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 11/20/2039 119.4 115.5 118.5 0.06%^MLM Enterprises LLC andDemand Printing Solutions Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 11/18/2024 70.5 59.5 57.5 0.03%^JEJE Realty LLC and La FamiliaInc Food Services andDrinking Places Term Loan Prime plus2.75% 11/10/2039 205.8 197.1 198.2 0.09%^Joey O's LLC and JenniferOlszewski Specialty TradeContractors Term Loan Prime plus2.75% 11/7/2024 13.1 0.9 0.8 —%^Heartland American PropertiesLLC and Skaggs RV Outlet LLC Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 10/31/2039 479.0 460.6 471.0 0.23%^Golden Transaction Corporationdba Bleh Sunoco Gasoline Stations Term Loan Prime plus2.75% 10/30/2039 156.7 150.7 155.4 0.07%^Seelan Inc dba CandleridgeMarket Gasoline Stations Term Loan Prime plus2.75% 10/27/2039 90.5 87.0 87.3 0.04%^185 Summerfield Inc and ValconContracting Corp Construction ofBuildings Term Loan Prime plus2.75% 10/24/2039 162.3 156.0 160.5 0.08%^Navdeep B Martins and BusyBubbles LLC dba Wishy Washy Personal andLaundry Services Term Loan Prime plus2.75% 10/24/2039 89.0 85.7 84.6 0.04%^3 F Management LLC and ATCPort Charlotte LLC dba AroundThe Clock Fitness Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 10/17/2024 131.3 109.9 102.5 0.05%^One Hour Jewelry Repair Inc Repair andMaintenance Term Loan Prime plus2.75% 10/14/2024 20.6 17.2 15.4 0.01%^DNT Storage and Properties LLC Real Estate Term Loan Prime plus2.75% 10/10/2039 101.8 97.8 101.0 0.05%^Capitol Waste and RecyclingServices LLC Waste Managementand RemediationServices Term Loan Prime plus2.75% 10/10/2024 257.8 215.8 202.7 0.10%^Sound Manufacturing Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 10/10/2024 187.5 157.1 145.6 0.07%F-132See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Return to Excellence, Inc. dbaThe Waynesville Inn Golf & Spa Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/10/2039 1,250.0 1,216.5 1,270.0 0.61%^Boilermaker Industries LLC dbaPostNet Administrative andSupport Services Term Loan Prime plus2.75% 10/9/2024 18.8 5.7 5.8 —%^Smith Spinal Care Center P.C.and James C. Smith Ambulatory HealthCare Services Term Loan Prime plus2.75% 10/8/2039 60.0 57.7 58.8 0.03%^Doctors Express Management ofCentral Texas LLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 10/8/2024 105.0 77.8 76.5 0.04%^Michael Rey Jr. and Lynn J.Williams and GIG Petcare dbaHickory Personal andLaundry Services Term Loan Prime plus2.75% 10/3/2039 126.9 120.2 123.6 0.06%^Sumad LLC dba BrightStar Careof Encinitas Administrative andSupport Services Term Loan Prime plus2.75% 10/2/2024 92.5 44.5 44.9 0.02%^Roccos LLC and Sullo PantaloneInc Food Services andDrinking Places Term Loan Prime plus2.75% 9/30/2039 255.8 245.5 244.8 0.12%^Keller Holdings LLC and DavidH Keller III and Carie C Keller Scenic andSightseeingTransportation Term Loan Prime plus2.75% 9/30/2039 100.0 96.0 99.7 0.05%^Orange County InsuranceBrokerage Inc dba BeatyInsurance Agency Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 9/29/2039 325.1 313.1 326.7 0.16%^The Woods at Bear Creek LLCand Bear Creek EntertainmentLLC Accommodation Term Loan Prime plus2.75% 9/29/2039 513.3 495.1 516.6 0.25%^Keys Phase One LLC dba TheGrand Guesthouse Accommodation Term Loan Prime plus2.75% 9/26/2039 736.3 706.7 725.2 0.35%^Gordon E Rogers dbaStonehouse Motor Inn Accommodation Term Loan Prime plus2.75% 9/26/2039 57.5 55.2 57.6 0.03%^Auto Shine Carwash Inc andAKM R. Hossain and Jessica F.Masud Gasoline Stations Term Loan Prime plus2.75% 9/26/2024 22.5 18.7 17.2 0.01%^Colts V LLC and NowatzkeService Center, Inc Repair andMaintenance Term Loan Prime plus2.75% 9/26/2039 601.8 578.6 591.7 0.28%^North Columbia LLC and LoopLiquor and Convenience StoreLLC Food and BeverageStores Term Loan Prime plus2.75% 9/24/2039 159.3 152.9 156.6 0.07%^6 Price Avenue, LLC and PauleyTree & Lawn Care, Inc Administrative andSupport Services Term Loan Prime plus2.75% 9/24/2039 452.5 435.8 422.4 0.20%^R A Johnson Inc dba RickJohnson Auto and Tire Repair andMaintenance Term Loan Prime plus2.75% 9/23/2039 301.3 289.2 301.8 0.14%^Andrene's LLC dba Andrene'sCaribbean Soul Food Carry Out Food Services andDrinking Places Term Loan Prime plus2.75% 9/23/2024 37.8 29.5 26.4 0.01%^Play and Stay LLC dba ZoomRoom Tinton Falls Personal andLaundry Services Term Loan Prime plus2.75% 9/18/2024 42.1 35.4 31.6 0.02%^Ryan Crick and Pamela J. Crickand Crick Enterprises Inc Repair andMaintenance Term Loan Prime plus2.75% 9/17/2039 145.5 139.7 145.7 0.07%F-133See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Modern Leather Goods RepairShop Inc Repair andMaintenance Term Loan Prime plus2.75% 9/17/2024 58.8 48.3 43.2 0.02%^Tavern Properties LLC andWildwood Tavern LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/15/2039 425.0 410.7 419.6 0.20%^RDT Enterprises LLC Specialty TradeContractors Term Loan Prime plus2.75% 9/15/2027 162.8 143.6 143.5 0.07%^Animal Intrusion PreventionSystems Holding Company, LLC Administrative andSupport Services Term Loan Prime plus2.75% 9/15/2024 272.5 226.3 211.6 0.10%^KW Zion, LLC and Key WestGallery Inc Miscellaneous StoreRetailers Term Loan Prime plus2.75% 9/12/2039 1,250.0 1,199.9 1,230.5 0.59%^Indy East Smiles Youth DentistryLLC dba Prime Smile East Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/11/2024 630.2 523.3 469.6 0.22%^B&P Diners LLC dba EngineHouse Restaurant Food Services andDrinking Places Term Loan Prime plus2.75% 9/10/2024 80.0 66.4 59.3 0.03%^Feel The World Inc dba XeroShoes and Invisible Shoes Leather and AlliedProductManufacturing Term Loan Prime plus2.75% 9/5/2024 51.9 43.1 39.3 0.02%^Delta Aggregate LLC Mining (except Oiland Gas) Term Loan Prime plus2.75% 8/28/2039 911.3 862.4 900.0 0.43%^Lamjam LLC, GoldsmithLambros Inc Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 8/27/2024 133.8 110.4 111.2 0.05%^Orange County Cleaning Inc Administrative andSupport Services Term Loan Prime plus2.75% 8/27/2024 41.3 34.0 30.3 0.01%^Qycell Corporation Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 8/26/2024 121.0 99.7 94.5 0.05%^Atlas Auto Body Inc dba AtlasAuto Sales Repair andMaintenance Term Loan Prime plus2.75% 8/22/2039 51.6 49.4 49.6 0.02%^Katie Senior Care LLC dba HomeInstead Senior Care Social Assistance Term Loan Prime plus2.75% 8/15/2024 124.3 102.3 91.3 0.04%^S&P Holdings of Daytona LLCS&P Corporation of DaytonaBeach Miscellaneous StoreRetailers Term Loan Prime plus2.75% 8/15/2039 433.5 404.3 421.9 0.20%^Alpha Preparatory Academy LLC Social Assistance Term Loan Prime plus2.75% 8/15/2039 145.2 139.7 145.8 0.07%^Almost Home Property LLC andAlmost Home Daycare LLC Social Assistance Term Loan Prime plus2.75% 8/7/2039 715.8 686.9 710.4 0.34%^AGV Enterprises LLC dba Jet'sPizza #42 Food Services andDrinking Places Term Loan Prime plus2.75% 7/31/2024 54.8 44.8 40.8 0.02%^iFood, Inc. dba Steak N Shake Food Services andDrinking Places Term Loan Prime plus2.75% 7/31/2024 379.1 321.6 304.2 0.15%^575 Columbus Avenue HoldingCompany, LLC and LA-ZE LLCdba EST EST EST Food Services andDrinking Places Term Loan Prime plus2.75% 7/30/2039 22.5 21.2 22.1 0.01%F-134See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^L&S Insurance & FinancialServices Inc Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 7/25/2024 22.5 18.4 16.6 0.01%^Honeyspot Investors LLP andPace Motor Lines Inc TruckTransportation Term Loan Prime plus2.75% 7/24/2039 150.0 143.6 149.5 0.07%^Miss Cranston Diner II, LLC andMiss Cranston II Realty LLC Food Services andDrinking Places Term Loan Prime plus2.75% 7/17/2039 100.0 96.6 98.4 0.05%^AMG Holding, LLC and StetsonAutomotive, Inc Repair andMaintenance Term Loan Prime plus2.75% 6/30/2039 208.0 198.7 211.2 0.10%^Highway Striping Inc Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 6/30/2024 53.1 43.0 42.7 0.02%^Lisle Lincoln II LimitedPartnership dba Lisle Lanes LP Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 6/30/2024 100.0 81.0 82.6 0.04%^Honeyspot Investors LLP andPace Motor Lines Inc TruckTransportation Term Loan Prime plus2.75% 6/30/2039 875.3 837.8 890.1 0.43%^iFood, Inc. dba Steak N Shake Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2039 629.8 602.1 626.0 0.30%^FHJE Ventures LLC andEisenreich II Inc. dba BreakneckTavern Food Services andDrinking Places Term Loan Prime plus2.75% 6/27/2039 321.8 307.3 324.1 0.16%^Zinger Hardware and GeneralMerchant Inc Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 6/26/2024 110.5 89.4 89.9 0.04%^JPM Investments LLC andCarolina Family Foot Care P.A. Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/26/2039 136.1 132.6 140.2 0.07%^Nikobella Properties LLC and JPOInc dba Village Car Wash Repair andMaintenance Term Loan Prime plus2.75% 6/25/2039 476.3 456.1 481.5 0.23%^Big Sky Plaza LLC and Strickland,Incorporated Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 6/20/2039 233.4 222.9 235.1 0.11%^510 ROK Realty LLC dba ROKHealth and Fitness and Robert N.D'urso Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 6/19/2024 332.0 269.1 274.3 0.13%^Nirvi Enterprises LLC dbaHoward Johnson / Knights Inn Accommodation Term Loan Prime plus2.75% 6/17/2039 920.3 878.8 934.4 0.45%^Hotels of North Georgia LLC dbaComfort Inn and Suites Accommodation Term Loan Prime plus2.75% 6/17/2039 837.5 799.8 850.4 0.41%^Global Educational DeliveryServices LLC Educational Services Term Loan Prime plus2.75% 6/16/2024 60.0 49.2 50.2 0.02%^Rainbow Dry Cleaners Personal andLaundry Services Term Loan Prime plus2.75% 6/13/2024 122.5 99.1 98.7 0.05%^NVR Corporation dba DiscountFood Mart Food and BeverageStores Term Loan Prime plus2.75% 6/11/2039 68.3 63.5 67.5 0.03%F-135See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Sico & Walsh Insurance AgencyInc and The AMS Trust Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 6/6/2039 250.0 89.2 94.9 0.05%^Sujata Inc dba Stop N Save FoodMart and Dhruvesh Patel Food and BeverageStores Term Loan Prime plus2.75% 6/3/2024 22.5 18.2 18.1 0.01%^Long Island Barber + Beauty LLC Educational Services Term Loan Prime plus2.75% 6/2/2039 55.5 53.0 55.7 0.03%^CJR LLC and PowerWash Plus,Inc. Repair andMaintenance Term Loan Prime plus2.75% 5/30/2024 53.0 42.5 43.0 0.02%^Pocono Coated Products, LLC Printing and RelatedSupport Activities Term Loan Prime plus2.75% 5/30/2024 22.5 18.0 18.3 0.01%^EGM Food Services Inc dba GoldStar Chili Food Services andDrinking Places Term Loan Prime plus2.75% 5/29/2024 19.2 15.4 15.3 0.01%^R. A. Johnson, Inc. dba RickJohnson Auto & Tire Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 5/29/2039 943.8 899.8 956.7 0.46%^Wilton Dental Care P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 5/29/2024 128.1 105.0 103.4 0.05%^Jonesboro Health Food CenterLLC Health and PersonalCare Stores Term Loan Prime plus2.75% 5/27/2024 60.0 48.1 47.3 0.02%^USI Properties LLC dba U Store It Real Estate Term Loan Prime plus2.75% 5/23/2039 144.6 137.9 146.4 0.07%^Bay State Funeral Services, LLCand Riley Funeral Home Inc Personal andLaundry Services Term Loan Prime plus2.75% 5/21/2039 134.9 129.0 137.1 0.07%^Hae M. and Jin S. Park dbaBuford Car Wash Repair andMaintenance Term Loan Prime plus2.75% 5/15/2039 166.5 158.0 165.6 0.08%^Moochie's LLC Food Services andDrinking Places Term Loan Prime plus2.75% 5/13/2024 100.5 81.6 80.6 0.04%^The River Beas LLC and PunamSingh Food Services andDrinking Places Term Loan Prime plus2.75% 5/8/2039 90.3 86.0 90.7 0.04%^AS Boyals LLC dba TowneLiquors Food and BeverageStores Term Loan Prime plus2.75% 4/29/2039 117.5 111.8 118.9 0.06%^ENI Inc, Event Networks Inc, ENIWorldwide LLC and Spot Shop Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/25/2024 500.0 397.5 390.5 0.19%^Gerami Realty, LC SherrillUniversal City Corral, LP Food Services andDrinking Places Term Loan Prime plus2.75% 4/23/2027 78.8 67.5 69.6 0.03%^Complete Body & Paint, Inc. Repair andMaintenance Term Loan Prime plus2.75% 4/23/2039 20.8 19.9 21.1 0.01%^Island Wide Realty LLC and LongIsland Partners, Inc. Real Estate Term Loan Prime plus2.75% 4/22/2039 103.8 98.8 105.1 0.05%^Wilshire Media Systems Inc Specialty TradeContractors Term Loan Prime plus2.75% 4/17/2024 186.3 148.3 146.7 0.07%F-136See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^1899 Tavern & Tap LLC and AleHouse Tavern & Tap LLC Food Services andDrinking Places Term Loan Prime plus2.75% 4/9/2039 137.5 129.9 137.4 0.07%^Hodges Properties LLC andEchelon Enterprises Inc dba TreadsBicycle Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 3/31/2039 449.0 426.5 450.8 0.22%^Dantanna's Tavern LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2024 164.3 131.5 130.9 0.06%^Little People's Village II LLC andIliopoulos Realty LLC Social Assistance Term Loan Prime plus2.75% 3/31/2039 92.1 88.1 91.9 0.04%^RDT Enterprises, LLC Specialty TradeContractors Term Loan Prime plus2.75% 12/31/2028 141.2 123.9 128.3 0.06%^Little People's Village II LLC andIliopoulos Realty LLC Social Assistance Term Loan Prime plus2.75% 3/31/2039 101.5 97.1 101.4 0.05%^Eagle Aggregate Transportation,LLC and Eagle PneumaticTransport LLC TruckTransportation Term Loan Prime plus2.75% 3/31/2024 1,250.0 590.9 602.4 0.29%^Kemmer, LLC and Pitts PackageStore, Inc. Food and BeverageStores Term Loan Prime plus2.75% 3/31/2039 117.5 111.8 115.7 0.06%^Wilban LLC Food Services andDrinking Places Term Loan Prime plus2.75% 3/28/2039 427.5 407.2 429.7 0.21%^Lake Area Autosound LLC andRyan H. Whittington Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 7/28/2039 125.0 120.5 126.7 0.06%^Hascher Gabelstapler Inc Repair andMaintenance Term Loan Prime plus2.75% 3/26/2024 143.3 114.5 115.4 0.06%^Knowledge First Inc dba MagicYears of Learning and KimberlyKnox Social Assistance Term Loan Prime plus2.75% 3/21/2039 145.0 138.0 144.6 0.07%^Cormac Enterprises and WyomingValley Beverage Incorporated Food and BeverageStores Term Loan Prime plus2.75% 3/20/2039 110.8 105.4 112.0 0.05%^636 South Center Holdings, LLCand New Mansfield Brass andAluminum Co. Primary MetalManufacturing Term Loan Prime plus2.75% 3/20/2039 497.5 477.3 507.2 0.24%^Kinisi, Inc. dba The River NorthUPS Store Administrative andSupport Services Term Loan Prime plus2.75% 3/18/2024 41.3 26.2 26.4 0.01%^SE Properties 39 Old Route 146,LLC, SmartEarly Clifton Park LLC Social Assistance Term Loan Prime plus2.75% 3/14/2039 408.0 388.7 413.0 0.20%^Tortilla King Inc. Food Manufacturing Term Loan Prime plus2.75% 3/14/2039 216.9 206.9 216.0 0.10%^Tortilla King, Inc. Food Manufacturing Term Loan Prime plus2.75% 3/14/2029 1,033.1 926.1 943.6 0.45%^Bowl Mor, LLC dba Bowl MorLanes / Spare Lounge, Inc. Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 3/13/2039 223.5 212.3 225.6 0.11%^Avayaan2 LLC dba Island Cove Gasoline Stations Term Loan Prime plus2.75% 3/7/2039 157.5 149.6 157.8 0.08%F-137See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Onofrio's Fresh Cut Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 3/6/2024 75.0 59.1 59.9 0.03%^R & R Boyal LLC dba Cap N CatClam Bar and Little Ease Tavern Food and BeverageStores Term Loan Prime plus2.75% 2/28/2039 417.5 396.0 416.4 0.20%^Summit Beverage Group LLC Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 2/28/2024 350.6 273.7 275.2 0.13%^952 Boston Post Road Realty, LLCand HNA LLC dba StylesInternational Personal andLaundry Services Term Loan Prime plus2.75% 2/28/2039 211.0 200.1 209.9 0.10%^Choe Trade Group Inc dba RapidPrinters of Monterey Printing and RelatedSupport Activities Term Loan Prime plus2.75% 2/28/2024 159.3 124.4 126.8 0.06%^Faith Memorial Chapel LLC Personal andLaundry Services Term Loan Prime plus2.75% 2/28/2039 214.2 203.6 213.3 0.10%^96 Mill Street LLC, Central PizzaLLC and Jason Bikakis GeorgeBikaki Food Services andDrinking Places Term Loan Prime plus2.75% 2/12/2039 141.3 134.5 142.9 0.07%^JWB Industries, Inc. dba CarteretDie Casting Primary MetalManufacturing Term Loan Prime plus2.75% 2/11/2024 280.0 218.6 216.4 0.10%^Awesome Pets II Inc dba Mellisa'sPet Depot Miscellaneous StoreRetailers Term Loan Prime plus2.75% 2/7/2024 83.2 65.7 65.2 0.03%^986 Dixwell Avenue HoldingCompany, LLC and Mughali Foods,LLC Food Services andDrinking Places Term Loan Prime plus2.75% 2/7/2039 99.1 94.4 99.5 0.05%^Sovereign Communications LLC Broadcasting(except Internet) Term Loan Prime plus2.75% 2/7/2024 907.8 712.6 702.2 0.34%^Sarah Sibadan dba SibadanAgency Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 1/27/2039 129.4 122.5 129.7 0.06%^3Fmanagement LLC and ATCFitness Cape Coral, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 1/24/2024 425.0 328.7 326.6 0.16%^JDR Industries Inc dba CST-TheComposites Store, JetCat USA MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 1/21/2024 140.3 108.5 108.2 0.05%^Icore Enterprises Inc dba Air FlowFilters Inc MiscellaneousManufacturing Term Loan Prime plus2.75% 1/15/2024 21.8 16.8 17.1 0.01%^Carl R. Bieber, Inc. dba BieberTourways/BieberTransportation/Bieber Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/30/2027 712.5 616.3 635.8 0.30%^Nutmeg North Associates LLCSteeltech Building Products Inc Construction ofBuildings Term Loan Prime plus2.75% 12/31/2038 897.8 868.1 909.1 0.43%^CLU Amboy, LLC and AmboyGroup, LLC dba Tommy Moloney's Food Manufacturing Term Loan Prime plus2.75% 12/27/2023 656.3 511.4 521.0 0.25%^Shane M. Howell and BuckHardware and Garden Center, LLC Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 12/27/2038 322.5 304.7 318.7 0.15%F-138See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^KK International TradingCorporation MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/23/2028 190.0 165.0 169.4 0.08%^Kurtis Sniezek dba Wolfe'sForeign Auto Repair andMaintenance Term Loan Prime plus2.75% 12/20/2038 88.9 84.0 89.2 0.04%^Mosley Auto Group LLC dbaAmerica's Automotive Repair andMaintenance Term Loan Prime plus2.75% 12/20/2038 221.5 209.3 221.5 0.11%^Lefont Theaters Inc. Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 12/19/2023 14.4 11.0 11.0 0.01%^PLES Investements, LLC andJohn Redder, Pappy Sand &Gravel, Inc. Specialty TradeContractors Term Loan Prime plus2.75% 12/19/2038 555.3 524.6 550.6 0.26%^TAK Properties LLC andKinderland Inc Social Assistance Term Loan Prime plus2.75% 12/18/2038 405.0 383.2 402.7 0.19%^Any Garment Cleaner-EastBrunswick, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 12/18/2023 53.8 41.4 41.9 0.02%^TOL LLC dba Wild BirdsUnlimited Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 12/13/2023 18.0 14.3 14.2 0.01%^8 Minute Oil Change ofSpringfield Corporation and JohnNino Repair andMaintenance Term Loan Prime plus2.75% 12/12/2038 196.8 182.0 192.9 0.09%^920 CHR Realty LLC V.Garofalo Carting Inc Waste Managementand RemediationServices Term Loan Prime plus2.75% 12/10/2038 418.1 395.0 419.6 0.20%^DKB Transport Corp TruckTransportation Term Loan Prime plus2.75% 12/5/2038 138.8 131.1 139.2 0.07%^Firm Foundations Inc David SGaitan Jr and Christopher KDaigle Specialty TradeContractors Term Loan Prime plus2.75% 12/3/2038 104.3 98.5 102.3 0.05%^Spectrum Development LLC andSolvit Inc & Solvit North, Inc Specialty TradeContractors Term Loan Prime plus2.75% 12/2/2023 387.3 296.6 296.7 0.14%^BVIP Limousine Service LTD Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 11/27/2038 76.5 72.1 76.2 0.04%^Eco-Green Reprocessing LLCand Denali Medical Concepts,LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 11/27/2023 67.2 51.0 50.4 0.02%^Wallace Holdings LLC,GFAInternational Inc Professional,Scientific, andTechnical Services Term Loan Prime plus2.5% 11/25/2023 125.0 94.5 92.5 0.04%^AcuCall LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/21/2023 15.8 11.9 11.6 0.01%^Seven Peaks Mining Inc andCornerstone Industrial MineralsCorporation Mining (except Oiland Gas) Term Loan Prime plus2.75% 11/18/2038 1,250.0 1,175.6 1,218.3 0.58%F-139See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Kids in Motion of SpringfieldLLC dba The Little Gym ofSpringfield IL Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 11/18/2023 45.0 34.8 34.3 0.02%^Yousef Khatib dba Y&MEnterprises Wholesale ElectronicMarkets and Agentsand Brokers Term Loan Prime plus2.75% 11/15/2023 75.0 56.9 56.2 0.03%^Howell Gun Works LLC Sporting Goods,Hobby, MusicalInstrument, andBook Stores Term Loan Prime plus2.75% 11/14/2023 8.3 6.4 6.2 —%^Polpo Realty, LLC, PolpoRestaurant, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 11/6/2038 62.5 58.9 62.5 0.03%^Twinsburg Hospitality Group LLCdba Comfort Suites Accommodation Term Loan Prime plus2.75% 10/31/2038 945.0 893.7 937.8 0.45%^Mid-Land Sheet Metal Inc Specialty TradeContractors Term Loan Prime plus2.75% 10/31/2038 137.5 129.6 136.9 0.07%^Master CNC Inc & MasterProperties LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 10/31/2038 596.6 561.6 585.4 0.28%^Janice B. McShan and TheMetropolitan Day School, LLC Social Assistance Term Loan Prime plus2.75% 10/31/2023 42.8 33.1 33.7 0.02%^1 North Restaurant Corp dba 1North Steakhouse Food Services andDrinking Places Term Loan Prime plus2.75% 10/31/2038 212.5 200.0 211.6 0.10%^Meridian Hotels LLC dba BestWestern Jonesboro Accommodation Term Loan Prime plus2.75% 10/29/2038 664.5 625.3 664.1 0.32%^New Image Building Services Inc.dba New Image Repair Services Repair andMaintenance Term Loan Prime plus2.75% 10/29/2023 331.3 248.9 247.0 0.12%^Greenbrier Technical Services, Inc Repair andMaintenance Term Loan Prime plus2.75% 10/24/2023 240.1 164.4 167.5 0.08%^Clairvoyant Realty Corp. andNapoli Marble & Granite Design,Ltd Specialty TradeContractors Term Loan Prime plus2.75% 10/24/2038 246.3 231.8 242.6 0.12%^Kelly Auto Care LLC dbaShoreline Quick Lube and CarWash Repair andMaintenance Term Loan Prime plus2.75% 10/18/2023 87.5 65.7 65.3 0.03%^Cencon Properties LLC andCentral Connecticut WarehousingCompany Warehousing andStorage Term Loan Prime plus2.75% 9/30/2038 344.5 324.0 343.7 0.16%^Onofrios Enterprises LLCOnofrios Fresh Cut, Inc Food Manufacturing Term Loan Prime plus2.75% 9/30/2038 312.5 294.6 310.8 0.15%^Discount Wheel and Tire Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 9/30/2038 223.8 210.1 220.5 0.11%^First Steps Real Estate Company,LLC and First Steps Preschool Social Assistance Term Loan Prime plus2.75% 9/30/2038 97.6 91.7 95.7 0.05%^Lenoir Business Partners LLC LPIndustries, Inc dba Childforms Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 9/30/2038 322.7 308.0 324.4 0.16%F-140See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Top Properties LLC and LPIndustries, Inc dba Childforms Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 9/30/2038 120.0 114.3 121.4 0.06%^Mitchellville Family Dentistry, Dr.Octavia Simkins-Wiseman DDS PC Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/27/2038 335.1 314.6 331.2 0.16%^Gabrielle Realty, LLC Gasoline Stations Term Loan Prime plus2.75% 9/27/2038 757.6 711.3 746.0 0.36%^Anthony C Dinoto and Susan S PDinoto and Anthony C DinotoFuneral Homes Personal andLaundry Services Term Loan Prime plus2.75% 9/26/2038 100.0 94.0 99.8 0.05%^Eastside Soccer Dome, Inc . Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 9/26/2038 463.8 435.4 462.1 0.22%^Southeast Chicago Soccer, Inc. Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 9/26/2038 51.3 48.1 51.1 0.02%^HJ & Edward Enterprises, LLCdba Sky Zone Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 9/26/2023 262.5 201.7 203.3 0.10%^Kiddie Steps 4 You Inc. Social Assistance Term Loan Prime plus2.75% 9/25/2038 89.3 85.6 89.5 0.04%^Diamond Memorials Incorporated Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/25/2023 14.3 9.7 9.5 —%^Serious-Fun in Alpharetta, LLCdba The Little Gym of Alpharetta Educational Services Term Loan Prime plus2.75% 9/20/2023 46.3 34.6 34.2 0.02%^Faith Memorial Chapel LLC Personal andLaundry Services Term Loan Prime plus2.75% 9/20/2038 268.4 252.8 266.1 0.13%^Westville Seafood LLC Food Services andDrinking Places Term Loan Prime plus2.75% 9/19/2038 112.3 105.4 110.7 0.05%^Maynard Enterprises Inc dbaFastsigns of Texarkana Miscellaneous StoreRetailers Term Loan Prime plus2.75% 9/18/2023 16.1 12.1 12.0 0.01%^Grafio Inc dba Omega LearningCenter-Acworth Educational Services Term Loan Prime plus2.75% 9/13/2023 156.3 123.3 122.2 0.06%^Sound Manufacturing Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 9/12/2028 54.8 46.9 47.7 0.02%^The Berlerro Group, LLC dba SkyZone Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 9/12/2023 421.3 323.5 320.0 0.15%^Prospect Kids Academy Inc Educational Services Term Loan Prime plus2.75% 9/11/2038 124.3 116.4 122.8 0.06%^Alma J. and William R. Waltonand Almas Child Day Care Center Social Assistance Term Loan Prime plus2.75% 9/11/2038 39.5 37.1 39.4 0.02%^B for Brunette dba Blo Personal andLaundry Services Term Loan Prime plus2.75% 9/10/2023 53.4 40.3 39.5 0.02%F-141See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Schmaltz Holdings, LLC andSchmaltz Operations, LLC dbaCompanio Personal andLaundry Services Term Loan Prime plus2.75% 9/4/2038 224.2 208.8 219.1 0.10%^Excel RP Inc MachineryManufacturing Term Loan Prime plus2.75% 8/30/2023 130.3 96.0 97.5 0.05%^IlOKA Inc dba Microtech Tel andNewCloud Networks Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/30/2023 687.5 506.6 504.2 0.24%^ACI Northwest Inc. Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 8/30/2023 906.3 452.8 459.3 0.22%^Spectrum Radio Fairmont, LLC Broadcasting(except Internet) Term Loan Prime plus2.75% 8/30/2023 187.5 164.3 167.0 0.08%^Gulfport Academy Child Care andLearning Center, Inc. Social Assistance Term Loan Prime plus2.75% 8/30/2023 43.3 31.9 32.3 0.02%^Ramard Inc and Advanced HealthSciences Inc MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 8/28/2023 187.5 138.2 135.3 0.06%^RM Hawkins LLC dba Pure WaterTech West and Robert M Hawkins Nonstore Retailers Term Loan Prime plus2.75% 8/26/2023 85.8 59.8 60.9 0.03%^JSIL LLC dba BlackstonesHairdressing Personal andLaundry Services Term Loan Prime plus2.75% 8/16/2023 19.5 14.2 14.1 0.01%^Island Nautical Enterprises, Inc.and Ingwall Holdings, LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 8/14/2038 445.0 326.6 341.3 0.16%^Caribbean Concepts, Inc. dbaQuick Bleach Ambulatory HealthCare Services Term Loan Prime plus2.75% 8/12/2023 22.5 16.7 16.4 0.01%^209 North 3rd Street, LLC, YusterInsurance Group Inc Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 7/29/2038 83.9 78.5 82.7 0.04%^Majestic Contracting Services, Inc.dba Majestic Electric and Majestic Specialty TradeContractors Term Loan Prime plus2.75% 7/26/2038 190.0 177.7 186.2 0.09%^Daniel W and Erin H Gordon andSilver Lining Stables CT, LLC Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 7/24/2023 11.3 8.2 8.4 —%^Angkor Restaurant Inc Food Services andDrinking Places Term Loan Prime plus2.75% 7/19/2038 93.0 87.1 92.1 0.04%^Harbor Ventilation Inc and EstesInvestment, LLC Specialty TradeContractors Term Loan Prime plus2.75% 7/19/2038 92.1 22.4 23.7 0.01%^Tri County Heating and CoolingInc. Specialty TradeContractors Term Loan Prime plus2.75% 7/19/2023 87.8 64.0 65.0 0.03%^Morning Star Trucking LLC andMorning Star Equipment andLeasing LLC TruckTransportation Term Loan Prime plus2.75% 7/17/2023 53.8 39.2 38.4 0.02%^Maxiflex LLC MiscellaneousManufacturing Term Loan Prime plus2.75% 6/28/2023 153.5 110.5 112.9 0.05%F-142See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^GIA Realty LLC and VRAJ GIALLC dba Lakeview Laundromat Personal andLaundry Services Term Loan Prime plus2.75% 6/28/2038 97.5 91.0 97.1 0.05%^JRA Holdings LLC, Jasper CountyCleaners Inc dba Superior Cleaner Personal andLaundry Services Term Loan Prime plus2.75% 6/28/2038 121.0 112.0 119.4 0.06%^2161 Highway 6 Trail, LLC, R. H.Hummer JR., Inc. TruckTransportation Term Loan Prime plus2.75% 6/19/2026 1,250.0 788.0 812.6 0.39%^CBlakeslee Arpaia Chapman, Inc.dba Blakeslee Industrial Services Heavy and CivilEngineeringConstruction Term Loan Prime plus2.75% 6/18/2028 875.0 737.8 765.6 0.37%^KDP LLC and KDP InvestmentAdvisors, Inc and KDP AssetManagement, Inc Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 6/14/2023 343.8 248.2 249.4 0.12%^Elite Structures Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 6/12/2038 932.8 847.9 904.0 0.43%^Willowbrook Properties LLC,Grove Gardens Landscaping Inc. Administrative andSupport Services Term Loan Prime plus2.75% 6/5/2038 186.3 173.9 184.9 0.09%^Absolute Desire LLC and Mark H.Szierer, Sophisticated Smile Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/5/2038 188.3 175.9 186.1 0.09%^RKP Service dba RainbowCarwash Repair andMaintenance Term Loan Prime plus2.75% 5/31/2023 300.0 216.7 218.1 0.10%^RXSB, Inc dba Medicine Shoppe Health and PersonalCare Stores Term Loan Prime plus2.75% 5/30/2023 186.3 133.3 133.7 0.06%^Gregory P Jellenek OD andAssociates PC dba Gregory PJellenek OD Ambulatory HealthCare Services Term Loan Prime plus2.75% 5/28/2023 63.5 45.3 45.8 0.02%^Ryan D. Thornton and Thornton& Associates LLC Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 5/24/2023 68.8 37.3 37.4 0.02%^PowerWash Plus, Inc. and CJR,LLC Repair andMaintenance Term Loan Prime plus2.75% 4/30/2038 550.0 512.3 543.3 0.26%^Peanut Butter & Co., Inc. Food Manufacturing Term Loan Prime plus2.75% 4/30/2023 100.0 70.3 70.6 0.03%^Brothers International Desserts Food Manufacturing Term Loan Prime plus2.75% 4/26/2023 230.0 162.6 164.9 0.08%^Kidrose, LLC dba KidvilleRiverdale Educational Services Term Loan Prime plus2.75% 4/22/2023 78.8 56.3 56.9 0.03%^Vernon & Stephanie Scott andLittle Stars Day Care Center, Inc. Educational Services Term Loan Prime plus2.75% 4/18/2038 151.0 140.5 149.8 0.07%^1258 Hartford TPKE, LLC andPhelps and Sons, Inc Miscellaneous StoreRetailers Term Loan Prime plus2.75% 3/29/2038 124.6 115.7 122.4 0.06%^Capital Scrap Metal, LLC andPowerline Investment, LLC MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 3/29/2038 500.0 441.7 470.7 0.23%F-143See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^MRM Supermarkets Inc dbaConstantins Breads; Dallas GourmetBreads; Food Manufacturing Term Loan Prime plus2.75% 3/29/2038 336.0 312.5 330.0 0.16%^Neyra Industries, Inc. and EdwardNeyra Nonmetallic MineralProductManufacturing Term Loan Prime plus2.75% 3/27/2023 217.5 152.1 155.1 0.07%^A & M Commerce, Inc. dbaCranberry Sunoco Gasoline Stations Term Loan Prime plus2.75% 3/27/2038 330.3 306.4 325.7 0.16%^Xela Pack, Inc. and Aliseo andCatherine Gentile PaperManufacturing Term Loan Prime plus2.75% 3/27/2028 271.8 225.8 234.1 0.11%^American Diagnostic Imaging,Inc. dba St. Joseph Imaging Center Ambulatory HealthCare Services Term Loan Prime plus2.75% 3/25/2038 537.5 499.0 528.7 0.25%^Michael A.and HeatherR. Welschdba Art & FrameEtc. Miscellaneous StoreRetailers Term Loan Prime plus2.75% 3/22/2038 67.5 62.7 66.6 0.03%^M & H Pine Straw Inc and HarrisL. Maloy MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 3/21/2023 288.8 201.8 205.1 0.10%^Truth Technologies Inc dba TruthTechnologies Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 3/21/2023 79.5 55.6 55.9 0.03%^J. Kinderman & Sons Inc., dbaBriteStar Inc. ElectricalEquipment,Appliance, andComponentManufacturing Term Loan Prime plus2.75% 12/31/2018 181.3 129.5 129.8 0.06%^Stellar Environmental LLC Waste Managementand RemediationServices Term Loan Prime plus2.75% 3/18/2023 56.3 39.4 40.1 0.02%^Sound Manufacturing, Inc. andMonster Power Equipment Inc. Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 3/15/2023 523.0 364.8 369.5 0.18%^Golden Gate Lodging LLC Accommodation Term Loan Prime plus2.75% 3/12/2038 115.0 106.8 113.4 0.05%^Bakhtar Group LLC dbaMalmaison Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2023 103.8 72.4 72.6 0.03%^River Club Golf Course Inc dba TheRiver ClubAmusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 2/28/2038 475.2 440.2 467.2 0.22%^Osceola River Mill, LLC(EPC)Ironman Machine, Inc. MachineryManufacturing Term Loan Prime plus2.75% 2/20/2038 86.3 79.9 84.9 0.04%^Java Warung, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 2/19/2038 51.0 47.3 50.3 0.02%^Nancy & Karl Schmidt(EPC)Moments to Remember USA, LLC Printing and RelatedSupport Activities Term Loan Prime plus2.75% 2/15/2038 106.3 98.5 104.6 0.05%^Orient Direct, Inc. dba Spracht,Celltek, ODI MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 2/12/2023 84.9 58.0 58.1 0.03%^Knits R Us, Inc. dba NYC SportsTextile Mills Term Loan Prime plus2.75% 2/11/2038 125.0 116.0 123.6 0.06%F-144See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^North Country Transport, LLC Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 2/6/2023 15.0 10.4 10.6 0.01%^MJD Investments, LLC dba TheCommunity Day School Social Assistance Term Loan Prime plus2.75% 1/31/2038 258.3 238.9 253.2 0.12%^Sherill Universal City dba GoldenCorral Food Services andDrinking Places Term Loan Prime plus2.75% 1/28/2038 440.5 409.0 433.7 0.21%^Elegant Fireplace Mantels, Inc. dbaElegant Fireplace MantelsSpecialty TradeContractors Term Loan Prime plus2.75% 12/31/2022 97.5 66.0 66.2 0.03%^Macho LLC Madelaine ChocolateNovelties Inc dba The Madelai Food Manufacturing Term Loan Prime plus2.75% 12/31/2037 500.0 463.9 494.1 0.24%^WI130, LLC & Lakeland Group,Inc dba Lakeland Electrical MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 12/31/2028 271.5 226.7 233.0 0.11%^Babie Bunnie Enterprises Inc dbaTriangle Mothercare Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/28/2027 46.3 34.4 35.0 0.02%^John Duffy Fuel Co., Inc. MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/28/2022 513.8 348.0 354.7 0.17%^Polpo Realty LLC & PolpoRestaurant LLC dba PolpoRestauran Food Services andDrinking Places Term Loan Prime plus2.75% 12/27/2037 517.5 479.6 510.7 0.24%^Martin L Hopp, MD PHD AMedical Corp dba Tower ENT Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/21/2022 66.3 44.7 45.1 0.02%^United Woodworking, Inc Wood ProductManufacturing Term Loan 6% 12/20/2022 17.3 11.7 11.9 0.01%^Pioneer Window Holdings, Incand Subsidiaries dba PioneerWindows Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 12/20/2022 225.0 152.3 154.0 0.07%^Ezzo Properties, LLC and GreatLakes Cleaning, Inc. Administrative andSupport Services Term Loan Prime plus2.75% 12/20/2027 389.6 318.7 326.0 0.16%^The Amendments Group LLC dbaBrightstar Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/17/2022 22.5 15.2 15.5 0.01%^Cheryle A Baptiste and CheryleBaptiste DDS PLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/30/2037 286.5 265.0 281.5 0.13%^Aegis Creative Communications,Inc. Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 11/30/2022 387.5 252.3 252.6 0.12%^Daniel Gordon and Erin Gordonand Silver Lining Stables CT, LLC Support Activitiesfor Agriculture andForestry Term Loan Prime plus2.75% 11/28/2037 223.8 206.2 219.5 0.10%^D&L Rescources, Inc. dba TheUPS Store Miscellaneous StoreRetailersTerm Loan Prime plus2.75% 11/27/2022 9.8 6.5 6.5 —%^Richmond Hill Mini Market, LLC Food and BeverageStores Term Loan Prime plus2.75% 11/27/2037 185.3 170.7 181.3 0.09%^DRV Enterprise, Inc. dba Cici'sPizza # 339 Food Services andDrinking Places Term Loan Prime plus2.75% 11/26/2022 65.0 40.5 41.3 0.02%F-145See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Clean Brothers Company Inc dbaServPro of North WashingtonCounty Repair andMaintenance Term Loan Prime plus2.75% 11/21/2022 17.0 7.7 7.8 —%^U & A Food and Fuel, Inc. dbaExpress Gas & Food Mart Gasoline Stations Term Loan Prime plus2.75% 11/21/2037 96.3 88.7 94.4 0.05%^Pioneer Windows ManufacturingCorp, Pioneer Windows Fabricated MetalProductManufacturingTerm Loan Prime plus2.75% 11/21/2022 275.0 184.0 186.0 0.09%^R & J Petroleum LLC Manar USA,Inc. Gasoline Stations Term Loan Prime plus2.75% 11/20/2037 180.0 165.8 176.3 0.08%^St Judes Physical Therapy P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/19/2022 21.0 14.0 14.3 0.01%^Hi-Def Imaging, Inc. dbaSpeedPro Imaging Printing and RelatedSupport Activities Term Loan Prime plus2.75% 11/9/2022 22.2 14.9 15.0 0.01%^Reidville Hydraulics Mfg Inc dbaSummit MachineryManufacturingTerm Loan Prime plus2.75% 11/2/2037 265.9 245.2 258.7 0.12%^Big Apple Entertainment Partners,LLC dba Ripley's Believe It or Not Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 10/26/2022 180.0 121.8 122.0 0.06%^LA Diner Inc dba Loukas L ADiner Food Services andDrinking Places Term Loan Prime plus2.75% 9/28/2037 677.5 625.7 666.0 0.32%^ATC Fitness LLC dba Around theClock Fitness Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/28/2022 180.0 120.7 122.5 0.06%^University Park Retreat, LLC dbaMassage Heights Personal andLaundry Services Term Loan Prime plus2.75% 9/27/2022 76.0 49.6 50.5 0.02%^Forno Italiano Di NonnaRandazzo, LLC dba NonnaRandazzo's Bakery Food and BeverageStores Term Loan Prime plus2.75% 9/26/2037 183.8 169.9 180.0 0.09%^LaSalle Market and Deli EOK Incand Rugen Realty LLC dba LaSalleMark Food Services andDrinking Places Term Loan Prime plus2.75% 9/21/2037 252.3 231.4 245.0 0.12%^O'Rourkes Diner LLC dbaO'Rourke's Diner Food Services andDrinking Places Term Loan Prime plus2.75% 9/19/2037 65.5 60.1 63.5 0.03%^Michael J. Speeney & JoyceSpeeney and R2 Tape, Inc. MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 8/31/2037 367.5 336.4 358.1 0.17%^AJK Enterprise LLC dba AJKEnterprise LLC TruckTransportation Term Loan Prime plus2.75% 8/27/2022 16.5 10.6 10.8 0.01%^New Image Building Services, Inc.dba New Image Repair Services Repair andMaintenance Term Loan Prime plus2.75% 8/23/2037 285.7 261.6 275.7 0.13%^Suncoast Aluminum Furniture, Inc Furniture andRelated ProductManufacturing Term Loan Prime plus2.75% 8/17/2037 360.0 329.8 351.0 0.17%^Hofgard & Co., Inc. dbaHofgardBenefits Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 7/27/2022 107.3 68.3 69.3 0.03%F-146See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Georgia Safe Sidewalks LLC Specialty TradeContractors Term Loan Prime plus2.75% 7/27/2022 15.0 9.4 9.5 —%^Scoville Plumbing & Heating Incand Thomas P. Scoville Specialty TradeContractors Term Loan Prime plus2.75% 7/25/2022 50.0 33.5 34.1 0.02%^Central Tire, Inc. dba Cooper Tire& Auto Services Repair andMaintenance Term Loan Prime plus2.75% 6/29/2037 288.5 262.8 280.1 0.13%^WPI, LLC TransportationEquipmentManufacturing Term Loan Prime plus2.75% 6/29/2024 129.5 92.0 94.2 0.05%^Havana Central (NY) 5, LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/29/2022 1,166.8 766.6 780.9 0.37%^Jenkins-Pavia Corporation dbaVictory Lane Quick Oil Change Repair andMaintenance Term Loan Prime plus2.75% 6/27/2037 69.8 63.5 67.8 0.03%^KIND-ER-ZZ Inc dba Kidville Educational Services Term Loan Prime plus2.75% 6/15/2022 50.0 31.2 31.6 0.02%^Graphish Studio, Inc. and ScottFishoff Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 6/14/2022 20.3 12.7 12.9 0.01%^ALF, LLC, Mulit-Service EagleTires Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 5/31/2037 62.9 57.2 61.1 0.03%^Craig R Freehauf dba LincolnTheatre Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 5/31/2022 47.9 22.0 22.4 0.01%^Lefont Theaters, Inc. Motion Picture andSound RecordingIndustries Term Loan Prime plus2.75% 5/30/2022 137.0 85.2 86.6 0.04%^Christou Real Estate Holdings LLCdba Tops American Grill Food Services andDrinking Places Term Loan Prime plus2.75% 5/17/2037 284.0 257.9 275.4 0.13%^Tracey Vita-Morris dba TraceyVita's School of Dance Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 5/10/2022 22.5 14.0 14.2 0.01%^Bisson Transportation, Inc. TruckTransportation Term Loan Prime plus2.75% 5/7/2037 588.1 553.0 588.9 0.28%^Bisson Moving & StorageCompany Bisson TransportationInc and BTG Real TruckTransportation Term Loan Prime plus2.75% 5/7/2022 528.8 350.0 356.3 0.17%^Fair Deal Food Mart Inc dbaNeighbors Market Gasoline Stations Term Loan Prime plus2.75% 5/3/2037 381.3 346.5 370.3 0.18%^Tanner Optical, Inc. dba MurphyEye Care Ambulatory HealthCare Services Term Loan Prime plus2.75% 4/27/2022 8.3 5.0 5.1 —%^Zane Filippone Co Inc dbaCulligan Water Conditioning Nonstore Retailers Term Loan Prime plus2.75% 4/12/2022 558.2 344.0 350.0 0.17%^Indoor Playgrounds LimitedLiability Company dba Kidville Educational Services Term Loan Prime plus2.75% 4/5/2022 19.5 8.4 8.6 —%F-147See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Brandywine Picnic Park, Inc. andB.Ross Capps & Linda Capps Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 3/30/2031 231.5 195.9 205.8 0.10%^Access Staffing, LLC Administrative andSupport Services Term Loan Prime plus2.75% 3/30/2022 187.5 113.6 114.8 0.05%^Willow Springs Golf Course, Inc.& JC Lindsey Family LimitedPartners Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 3/29/2037 755.4 696.2 743.5 0.36%^Manuel P. Barrera and AccuraElectrical Contractor, Inc. Specialty TradeContractors Term Loan Prime plus2.75% 3/23/2028 103.7 82.0 84.9 0.04%^Shweiki Media, Inc. dba StudyBreaks Magazine Publishing Industries(except Internet) Term Loan Prime plus2.75% 3/22/2027 1,178.8 916.7 947.4 0.45%^ATC Fitness, LLC Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 2/28/2022 10.2 6.1 6.2 —%^ATI Jet, Inc. Air Transportation Term Loan Prime plus2.75% 12/28/2026 852.8 643.1 664.9 0.32%^J. Kinderman & Sons, Inc. dbaBrite Star Manufacturing Company Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 12/22/2036 495.0 452.5 482.9 0.23%^K's Salon, LLC d/b/a K's Salon Personal andLaundry Services Term Loan Prime plus2.75% 12/20/2021 73.6 42.8 43.2 0.02%^15 Frederick Place LLC & PioneerWindows Holdings Inc & Subs Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 12/16/2021 250.0 144.1 146.2 0.07%^M & H Pinestraw, Inc. and HarrisL. Maloy MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 12/15/2021 238.3 138.6 140.5 0.07%^Taylor Transport, Inc TruckTransportation Term Loan Prime plus2.75% 12/8/2021 515.5 219.2 223.1 0.11%^Thomas P. Scoville dba ScovillePlumbing & Heating, Inc. Specialty TradeContractors Term Loan Prime plus2.75% 11/16/2021 62.5 35.6 36.3 0.02%^MRM Supermarkets, Inc. dbaConstantin's Breads Food Manufacturing Term Loan Prime plus2.75% 11/10/2021 137.5 79.0 80.2 0.04%^K9 Bytes, Inc & Epazz, Inc dbaK9 Bytes, Inc Publishing Industries(except Internet) Term Loan Prime plus2.75% 10/26/2021 58.8 34.4 34.8 0.02%^28 Cornelia Street Properties, LLCand Zouk, Ltd.dba Palma Food Services andDrinking Places Term Loan Prime plus2.75% 10/25/2021 22.5 12.5 12.7 0.01%^PTK, Incorporated dba Night NDay 24 HR Convenience Store Food and BeverageStores Term Loan Prime plus2.75% 9/30/2036 137.5 122.9 131.0 0.06%^39581 Garfield, LLC andTricounty Neurological Associates,P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/30/2036 28.5 25.3 26.9 0.01%^39581 Garfield, LLC and TriCounty Neurological Associates,P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 9/30/2036 83.3 74.3 79.1 0.04%F-148See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Robert E. Caves, Sr. and AmericanPlank dba Caves Enterprises MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/30/2021 302.5 165.5 168.3 0.08%^Big Apple Entertainment Partners,LLC dba Ripley's Believe it or Not Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/28/2021 1,070.0 589.1 594.4 0.28%^Polymer Sciences, Inc. dbaPolymer Sciences, Inc. Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 9/28/2036 422.6 377.3 402.4 0.19%^Equity National Capital LLC &Chadbourne Road Capital, LLC Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 9/26/2021 62.5 34.8 35.2 0.02%^Bryan Bantry Inc. Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 9/8/2021 400.0 148.1 149.4 0.07%^SBR Technologies d/b/a ColorGraphics Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/31/2021 806.2 433.9 441.2 0.21%^Michael S. Decker & Janet Deckerdba The Hen House Cafe Food Services andDrinking Places Term Loan Prime plus2.75% 8/30/2036 16.4 14.7 15.6 0.01%^Qycell Corporation Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 8/19/2021 187.5 97.1 98.2 0.05%^Trademark Equipment CompanyInc and David A. Daniel Miscellaneous StoreRetailers Term Loan Prime plus2.75% 8/19/2036 133.6 119.1 126.8 0.06%^Valiev Ballet Academy, Inc Performing Arts,Spectator Sports,and RelatedIndustries Term Loan Prime plus2.75% 8/12/2036 91.5 37.8 40.3 0.02%^A & A Auto Care, LLC dba A &A Auto Care, LLC Repair andMaintenance Term Loan Prime plus2.75% 8/12/2036 101.0 90.1 96.0 0.05%^LaHoBa, LLC dba Papa John's Food Services andDrinking Places Term Loan Prime plus2.75% 8/3/2036 77.5 68.6 73.2 0.04%^Kelly Chon LLC dba Shi-Golf MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 7/29/2021 17.5 6.9 7.0 —%^MTV Bowl, Inc. dba LegendLanes Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/30/2036 248.5 223.0 237.7 0.11%^Lavertue Properties LLP dbaLavertue Properties Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan Prime plus2.75% 6/29/2036 44.8 39.8 42.5 0.02%^Lisle Lincoln II LimitedPartnership dba Lisle Lanes LP Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 6/29/2036 338.1 312.0 332.9 0.16%^Pierce Developments, Inc. dbaSouthside Granite MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 6/13/2036 256.1 227.3 242.2 0.12%F-149See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Major Queens Body & FenderCorp Repair andMaintenance Term Loan Prime plus2.75% 6/10/2021 28.6 15.2 15.4 0.01%^J&K Fitness, LLC dba PhysiquesWomens Fitness Center Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 6/8/2036 449.3 407.6 434.9 0.21%^Peanut Butter & Co., Inc. dbaPeanut Butter & Co. MerchantWholesalers,Nondurable Goods Term Loan Prime plus2.75% 6/3/2021 65.5 33.6 34.0 0.02%^Demand Printing Solutions, Inc.and MLM Enterprises, LLC dbaDemand Printing and RelatedSupport Activities Term Loan Prime plus2.75% 5/27/2021 16.5 8.6 8.7 —%^Modern on the Mile, LLC dbaLigne Roset Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 5/25/2021 212.5 110.0 111.4 0.05%^Music Mountain Water Company,LLC Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 4/25/2036 138.1 121.4 129.6 0.06%^Profile Performance, Inc. andEidak Real Estate, L.L.C. Repair andMaintenance Term Loan Prime plus2.75% 4/20/2036 127.5 112.6 120.2 0.06%^Northwind Outdoor Recreation,Inc. dba Red Rock Wilderness Store Nonstore Retailers Term Loan Prime plus2.75% 4/18/2036 129.5 116.5 124.4 0.06%^Michael S. Korfe dba North ValleyAuto Repair Repair andMaintenance Term Loan Prime plus2.75% 3/24/2036 15.5 13.7 14.6 0.01%^Actknowledge,Inc dbaActknowledge Personal andLaundry Services Term Loan Prime plus2.75% 3/21/2021 57.3 29.0 29.4 0.01%^Food & Beverage Associates OfN.J. Inc Food Services andDrinking Places Term Loan Prime plus2.75% 3/11/2021 10.0 4.4 4.5 —%^Key Products I&II, Inc. dbaDunkin' Donuts/Baskin-Robbins Food and BeverageStores Term Loan Prime plus2.75% 3/10/2021 153.0 77.5 78.4 0.04%^Stephen Frank, Patricia Frank andSuds Express LLC dba FrankChiropra Ambulatory HealthCare Services Term Loan Prime plus2.75% 2/25/2023 63.0 36.2 37.1 0.02%^SuzyQue’s LLC dba Suzy Que’s Food Services andDrinking Places Term Loan Prime plus2.75% 2/11/2036 61.0 53.8 57.4 0.03%^Little People’s Village, LLC dbaLittle People’s Village Social Assistance Term Loan Prime plus2.75% 1/31/2036 31.1 27.3 29.1 0.01%^Seagate Group Holdings, Inc. dbaSeagate Logistics, Inc. Support Activitiesfor Transportation Term Loan Prime plus2.75% 1/28/2036 113.4 99.4 106.1 0.05%^Patrageous Enterprises, LLC dbaIncredibly Edible Delites of Laurel Food and BeverageStores Term Loan Prime plus2.75% 12/29/2020 7.6 3.5 3.5 —%Dixie Transport, Inc. & Johnny D.Brown & Jimmy Brown & MaudainBrown Support Activitiesfor Transportation Term Loan 5.25% 12/28/2035 145.9 137.4 146.2 0.07%^Shree OM Lodging, LLC dbaRoyal Inn Accommodation Term Loan Prime plus2.75% 12/17/2035 27.7 24.2 25.8 0.01%Groundworks Unlimited LLC Specialty TradeContractors Term Loan 6% 12/17/2023 120.0 81.2 83.4 0.04%F-150See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Lodin Medical Imaging, LLC dbaWatson Imaging Center Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/1/2020 66.4 30.7 31.1 0.01%^Robert F. Schuler and Lori A.Schuler dba Bob’s Service Center Repair andMaintenance Term Loan Prime plus2.75% 11/30/2035 34.0 29.7 31.6 0.02%^Any Garment Cleaner-EastBrunswick, Inc dba Any GarmentCleaner Personal andLaundry Services Term Loan Prime plus2.75% 11/18/2020 42.5 16.9 17.1 0.01%^West Cobb Enterprises, Inc andAdvanced Eye Associates, L.L.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 11/12/2035 148.7 129.9 138.3 0.07%^Lincoln Park Physical Therapy Ambulatory HealthCare Services Term Loan Prime plus2.75% 10/20/2020 43.5 19.9 20.2 0.01%^K9 Bytes, Inc & Epazz, Inc Publishing Industries(except Internet) Term Loan Prime plus2.75% 9/30/2020 18.5 8.7 8.8 —%^Elan Realty, LLC and Albert BasseAsociates, Inc. Printing and RelatedSupport Activities Term Loan Prime plus2.75% 9/30/2035 228.2 198.3 211.3 0.10%^Success Express,Inc. dba SuccessExpress Couriers andMessengers Term Loan Prime plus2.75% 9/29/2020 91.8 41.1 41.4 0.02%^Modern Manhattan, LLC Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 9/20/2020 204.0 92.5 93.5 0.04%^Dirk's Trucking, L.L.C. dba Dirk'sTrucking TruckTransportation Term Loan Prime plus2.75% 9/17/2020 17.7 7.9 8.0 —%^Rudy & Louise Chavez dbaClyde's Auto and FurnitureUpholstery Repair andMaintenance Term Loan Prime plus2.75% 9/2/2035 50.1 43.4 46.3 0.02%^Newsome Trucking Inc and KevinNewsome TruckTransportation Term Loan Prime plus2.75% 9/2/2035 423.1 208.3 221.6 0.11%^California College ofCommunications, Inc. Educational Services Term Loan Prime plus2.75% 11/2/2020 172.5 79.7 80.5 0.04%^DDLK Investments LLC dbaSmoothie King Food Services andDrinking Places Term Loan Prime plus2.75% 8/30/2020 7.5 2.6 2.6 —%^Planet Verte,LLC dba AudioUnlimited Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 9/20/2020 40.0 17.9 18.0 0.01%^Members Only Software Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 8/30/2020 40.3 17.6 17.8 0.01%^ActKnowledge,Inc dbaActKnowledge Personal andLaundry Services Term Loan Prime plus2.75% 6/30/2020 50.0 21.4 21.6 0.01%^I-90 RV & Auto Supercenter Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 6/29/2035 74.9 64.6 68.9 0.03%^WeaverVentures, Inc dba The UPSStore Postal Service Term Loan Prime plus2.75% 7/28/2020 23.8 10.3 10.5 0.01%^CJ Park Inc. dba Kidville MidtownWest Educational Services Term Loan Prime plus2.75% 6/25/2020 26.4 8.9 9.0 —%F-151See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Zouk, Ltd. dba Palma Food Services andDrinking Places Term Loan Prime plus2.75% 8/25/2020 27.5 12.2 12.3 0.01%^Tanner Optical Inc. dba MurphyEye Care Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/22/2035 94.6 81.7 87.1 0.04%^M & H Pine Straw, Inc.and HarrisMaloy Support Activitiesfor Agriculture andForestry Term Loan Prime plus2.75% 7/10/2020 67.5 29.2 29.6 0.01%^Excel RP, Inc., Kevin and JoannFoley MachineryManufacturing Term Loan Prime plus2.75% 7/8/2028 50.0 37.9 39.6 0.02%ValleyStar, Inc. dba BrightStarHealthCare Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/28/2020 0.6 2.6 2.6 —%^ValleyStar, Inc. dba BrightStarHealthcare Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/28/2020 7.5 3.2 3.2 —%^Diag, LLC dba Kidville Educational Services Term Loan Prime plus2.75% 6/21/2020 37.5 15.6 15.8 0.01%^M & H Pine Straw, Inc and HarrisL. Maloy Support Activitiesfor Agriculture andForestry Term Loan 6% 4/30/2020 183.3 59.4 60.2 0.03%^New Economic Methods LLC dbaRita's Food Services andDrinking Places Term Loan Prime plus2.75% 7/15/2020 24.8 0.7 0.7 —%^Cocoa Beach Parasail Corp. dbaCocoa Beach Parasail Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 4/26/2020 6.3 2.5 2.6 —%^Vortex Automotive LLC Repair andMaintenance Term Loan Prime plus2.75% 3/5/2035 76.6 65.8 70.1 0.03%^ATC Fitness LLC dba Around theClock Fitness Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 2/28/2019 15.0 4.5 4.5 —%^Lahoba,LLC dba Papa John'sPizza Food Services andDrinking Places Term Loan Prime plus2.75% 12/30/2034 42.5 36.2 38.6 0.02%^Music Mountain WaterCompany,LLC dba MusicMountain Water Co. Beverage andTobacco ProductManufacturing Term Loan Prime plus2.75% 12/29/2019 185.4 69.1 69.9 0.03%^Animal Intrusion PreventionSystems Holding Company, LLC Administrative andSupport Services Term Loan Prime plus2.75% 3/29/2024 126.5 29.0 29.9 0.01%^David A. Nusblatt, D.M.D, P.C. Ambulatory HealthCare Services Term Loan Prime plus2.75% 12/11/2019 9.0 3.3 3.3 —%^CMA Consulting dba ConstructionManagement Associates Construction ofBuildings Term Loan Prime plus2.75% 12/11/2019 58.5 19.5 19.7 0.01%^KMC RE, LLC & B&B Kennels Personal andLaundry Services Term Loan Prime plus2.75% 11/19/2034 58.3 49.5 52.7 0.03%^Demand Printing Solutions, Inc. Printing and RelatedSupport Activities Term Loan Prime plus2.75% 12/12/2019 10.0 3.6 3.7 —%F-152See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Planet Verte, LLC dba AudioUnlimited of Oceanside Administrative andSupport Services Term Loan Prime plus2.75% 11/28/2019 57.0 20.3 20.5 0.01%^Demand Printing Solutions, Inc Printing and RelatedSupport Activities Term Loan Prime plus2.75% 10/29/2034 147.5 124.9 132.9 0.06%^Supreme Screw Products Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 4/17/2019 308.2 87.6 88.4 0.04%^Gray Tree Service, Inc. Administrative andSupport Services Term Loan Prime plus2.75% 12/18/2018 50.0 12.4 12.5 0.01%^Envy Salon & Spa LLC Personal andLaundry Services Term Loan Prime plus2.75% 12/4/2018 20.3 4.9 4.9 —%^Gourmet to You, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 2/28/2019 12.1 3.3 3.3 —%^The Alba Financial Group, Inc. Securities,CommodityContracts, and OtherFinancialInvestments andRelated Activities Term Loan 6% 1/10/2019 22.5 12.1 12.2 0.01%^Grapevine Professional Services,Inc. Administrative andSupport Services Term Loan Prime plus2.75% 1/22/2019 8.2 2.0 2.0 —%^Inflate World Corporation Amusement,Gambling, andRecreationIndustries Term Loan Prime plus2.75% 9/30/2018 7.5 1.3 1.3 —%^Peter Thomas Roth Labs LL MerchantWholesalers,Durable Goods Term Loan Prime plus2.75% 9/26/2018 425.0 93.3 93.9 0.04%^Dream Envy, Ltd. dba MassageEnvy Personal andLaundry Services Term Loan Prime plus2.75% 11/9/2018 88.0 20.6 20.7 0.01%^CBA D&A Pope, LLC dbaChristian Brothers Automotive Repair andMaintenance Term Loan Prime plus2.75% 6/14/2018 144.9 28.8 28.9 0.01%^Gilbert Chiropractic Clinic, Inc. Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/7/2018 22.5 4.0 4.1 —%^D & D's Divine Beauty School ofEsther, LLC Educational Services Term Loan 6% 8/1/2031 57.7 51.3 54.1 0.03%^Daniel S. Fitzpatrick dba Danny'sMobile Appearance ReconditioningService Repair andMaintenance Term Loan Prime plus2.75% 3/29/2018 9.4 1.6 1.6 —%^Burks & Sons Development LLCdba Tropical Smoothie Cafe Food Services andDrinking Places Term Loan Prime plus2.75% 3/22/2018 49.8 8.0 8.0 —%Bliss Coffee and Wine Bar, LLC Food Services andDrinking Places Term Loan 6% 3/19/2018 87.5 69.9 70.2 0.03%^Zog Inc. Other InformationServices Term Loan 6% 3/17/2018 97.5 62.1 62.3 0.03%^Saan M.Saelee dba Saelee'sDelivery Service TruckTransportation Term Loan Prime plus2.75% 3/12/2018 9.8 1.6 1.6 —%F-153See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssetsIntegrity Sports Group, LLC Performing Arts,Spectator Sports,and RelatedIndustries Term Loan 6% 3/6/2018 75.0 31.7 31.8 0.02%^Enewhere Custom Canvas, LLC Textile ProductMills Term Loan Prime plus2.75% 2/15/2018 12.0 1.9 1.9 —%^A & A Acquisition, Inc. dba A &A International Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 2/15/2018 100.0 14.8 14.9 0.01%^All American Printing Printing and RelatedSupport Activities Term Loan Prime plus2.75% 10/26/2032 69.8 37.6 39.8 0.02%^Seo's Paradise Cleaners, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 1/19/2018 9.8 0.6 0.6 —%^Margab, Inc. dba Smoothie King Food Services andDrinking Places Term Loan Prime plus2.75% 12/28/2017 44.0 5.7 5.7 —%^RCB Enterprises, Inc. Administrative andSupport Services Term Loan Prime plus2.75% 12/18/2017 21.2 3.4 3.4 —%^Timothy S. Strange dba Strange'sMobile Apperance ReconditioningService Repair andMaintenance Term Loan Prime plus2.75% 12/17/2017 8.4 0.8 0.8 —%^Parties By Pat, Inc. and Jose M.Martinez Jr. Food Services andDrinking Places Term Loan Prime plus2.75% 12/11/2017 93.1 11.8 11.8 0.01%^Tammy's Bakery, Inc. dbaTammy's Bakery Food Manufacturing Term Loan Prime plus2.75% 12/10/2017 71.8 9.9 10.0 —%^Maria C. Sathre and David N.Sathre dba Black Forest LiquorStore Food and BeverageStores Term Loan Prime plus2.75% 11/28/2017 18.6 2.2 2.2 —%^MJ Mortgage & Tax Services,Inc. CreditIntermediation andRelated Activities Term Loan Prime plus2.75% 11/14/2017 6.9 0.4 0.4 —%^Kings Laundry,LLC Personal andLaundry Services Term Loan Prime plus2.75% 10/30/2017 64.5 7.1 7.1 —%^Quality Engraving Services Inc.and Ian M. Schnaitman Miscellaneous StoreRetailers Term Loan Prime plus2.75% 10/17/2017 15.0 1.7 1.7 —%^Louis B. Smith dba LAQ FuneralCoach Transit and GroundPassengerTransportation Term Loan Prime plus2.75% 9/15/2017 12.6 1.2 1.2 —%^1911 East Main Street Holdings,Corp Repair andMaintenance Term Loan Prime plus2.75% 5/18/2032 15.8 12.3 13.1 0.01%^Metano IBC Services, Inc. andStone Brook Leasing, LLC Rental and LeasingServices Term Loan Prime plus2.75% 8/17/2017 315.0 25.2 25.3 0.01%^Mala Iyer, MD dba Child andFamily Wellness Center Ambulatory HealthCare Services Term Loan Prime plus2.75% 8/11/2017 50.0 4.8 4.9 —%^Twietmeyer Dentistry PA Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/30/2017 148.9 9.9 9.9 —%^Water Works Laundromat, LLC Personal andLaundry Services Term Loan Prime plus2.25% 9/7/2027 267.3 184.0 187.1 0.09%F-154See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Dave Kris, and MDK Ram Corp. Food and BeverageStores Term Loan Prime plus2.75% 2/5/2026 221.0 32.3 33.4 0.02%^No Thirst Software LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/26/2017 6.8 0.2 0.2 —%^CCIPTA, LLC Clothing andClothing AccessoriesStores Term Loan Prime plus2.75% 1/17/2017 47.0 0.2 0.2 —%^Gill Express Inc. dba AmericanEagle Truck Wash Repair andMaintenance Term Loan Prime plus2.75% 1/5/2027 286.9 187.3 194.8 0.09%^Spain Street LLC Food Services andDrinking Places Term Loan Prime plus2.75% 6/29/2017 63.0 0.9 0.9 —%^Kyoshi Enterprises, LLC Educational Services Term Loan Prime plus2.75% 12/29/2016 22.5 — — —%^Nora A. Palma and Julio O Villcas Food Services andDrinking Places Term Loan Prime plus2.75% 6/27/2017 56.3 0.1 0.1 —%^Smooth Grounds, Inc. Food Services andDrinking Places Term Loan 7.75% 12/31/2018 64.5 30.6 30.8 0.01%^Fran-Car Corporation dbaHorizon Landscape Management Administrative andSupport Services Term Loan Prime plus2.75% 3/3/2028 407.8 161.0 168.0 0.08%^Head To Toe PersonalizedPampering, Inc. Personal andLaundry Services Term Loan Prime plus2.75% 1/27/2031 52.0 9.0 9.5 —%^Maxwell Place, LLC Nursing andResidential CareFacilities Term Loan 6.5% 12/31/2018 1,076.8 772.5 779.2 0.37%^Christopher F. Bohon & PamelaD. Bohon Social Assistance Term Loan Prime plus2.75% 10/28/2026 14.2 3.2 3.4 —%^Shree Om Lodging, LLC dbaRoyal Inn Accommodation Term Loan Prime plus2.75% 5/2/2030 333.3 64.1 67.4 0.03%^Pedzik's Pets, LLC Support Activitiesfor Agriculture andForestry Term Loan Prime plus2.75% 3/31/2030 53.5 9.0 9.4 —%^Nancy Carapelluci & A & MSeasonal Corner Inc. Building Materialand GardenEquipment andSupplies Dealers Term Loan Prime plus2.75% 3/1/2025 106.9 14.5 15.0 0.01%^Moonlight Multi MediaProduction, Inc. Other InformationServices Term Loan 5.3% 2/1/2025 19.7 3.3 3.4 —%David M. Goens dba Superior AutoPaint & Body, Inc. Repair andMaintenance Term Loan 6% 8/26/2024 250.0 17.5 18.1 0.01%^McCallister Venture Group, LLCand Maw's Vittles, Inc. Food Services andDrinking Places Term Loan Prime plus2.75% 7/30/2029 75.0 11.6 12.1 0.01%^Computer Renaissance dba DanteIT Services, Inc. Electronics andAppliance Stores Term Loan Prime plus3.75% 3/1/2018 100.0 1.6 1.6 —%F-155See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Chong Hun Im dba Kim's Market Food and BeverageStores Term Loan Prime plus2.5% 2/27/2024 80.0 9.5 9.7 —%Whirlwind Car Wash, Inc. Repair andMaintenance Term Loan Prime plus2% 4/9/2029 333.3 65.5 65.8 0.03%^West Experience,Inc/WestMountain EquipmentRental,Inc/Ski West Lodge Amusement,Gambling, andRecreation Industries Term Loan 6% 6/5/2026 1,333.0 863.5 895.8 0.43%^Center-Mark Car Wash, Ltd Specialty TradeContractors Term Loan Prime plus2.75% 5/18/2024 221.3 27.9 28.7 0.01%^Shuttle Car Wash, Inc. dba ShuttleCar Wash Repair andMaintenance Term Loan Prime plus2.25% 11/10/2028 109.8 17.2 17.5 0.01%^Min Hui Lin Food Services andDrinking Places Term Loan Prime plus2.75% 1/30/2028 134.3 17.5 18.2 0.01%^Delta Partners, LLC dba DeltaCarwash Repair andMaintenance Term Loan Prime plus2.5% 4/5/2029 280.9 42.5 44.0 0.02%^Auto Sales, Inc. Motor Vehicle andParts Dealers Term Loan 6% 8/17/2023 75.0 7.8 8.0 —%^B & J Manufacturing Corporationand Benson Realty Trust Fabricated MetalProductManufacturing Term Loan Prime plus2% 3/30/2021 250.0 18.8 18.8 0.01%^RAB Services, Inc. & ProfessionalFloor Installations Specialty TradeContractors Term Loan Prime plus2.5% 1/31/2023 62.5 7.0 7.1 —%^Ralph Werner dba WernerTransmissions Gasoline Stations Term Loan Prime plus2.75% 12/29/2021 26.6 2.3 2.4 —%^Taste of Inverness, Inc. dba ChinaGarden Food Services andDrinking Places Term Loan Prime plus2% 6/29/2025 73.8 8.8 8.8 —%^M. Krishna, Inc. dba Super 8Motel Accommodation Term Loan Prime plus2% 3/20/2025 250.0 9.4 9.5 —%^Robin C. & Charles E. Taylor &Brigantine Aquatic Center LLC Amusement,Gambling, andRecreation Industries Term Loan 6% 9/14/2023 185.8 31.5 32.3 0.02%^OrthoQuest, P.C. Ambulatory HealthCare Services Term Loan Prime plus2% 3/12/2022 56.8 4.3 4.3 —%^CPN Motel, L.L.C. dba AmericanMotor Lodge Accommodation Term Loan Prime plus2.25% 4/30/2024 379.0 30.8 31.1 0.01%^Track Side Collision & Tire, Inc. Plastics and RubberProductsManufacturing Term Loan Prime plus2.75% 6/16/2025 44.8 4.9 5.0 —%^Duttakrupa, LLC dba BirminghamMotor Court Accommodation Term Loan Prime plus2.25% 9/8/2023 98.8 12.2 12.3 0.01%^Deesha Corporation, Inc. dba BestInn & Suites Accommodation Term Loan Prime plus2.25% 2/14/2025 250.0 27.4 27.8 0.01%^Maruti, Inc Accommodation Term Loan Prime plus2.25% 11/25/2024 220.0 25.4 25.7 0.01%Willington Hills Equestrian CenterLLC Animal Productionand Aquaculture Term Loan Prime plus2.75% 10/19/2022 85.0 12.8 13.1 0.01%F-156See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^LABH, Inc. Accommodation Term Loan Prime plus2.25% 9/27/2024 555.0 40.8 41.3 0.02%^Randall D. & Patricia D. Casaburidba Pat's Pizzazz Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 3/13/2023 68.8 7.0 7.2 —%^Gain Laxmi, Inc. dba Super 8Motel Accommodation Term Loan Prime plus2.25% 5/31/2023 202.5 20.0 20.2 0.01%^Naseeb Corporation Accommodation Term Loan Prime plus2.25% 3/31/2024 402.5 29.8 30.2 0.01%^Stillwell Ave Prep School Social Assistance Term Loan Prime plus2.75% 1/14/2023 72.0 6.4 6.5 —%^Karis, Inc. Accommodation Term Loan Prime plus2% 12/22/2023 148.8 13.4 13.4 0.01%^Five Corners, Ltd. Gasoline Stations Term Loan Prime plus2.75% 12/11/2019 85.0 4.7 4.8 —%^Alyssa Corp dba Knights Inn Accommodation Term Loan Prime plus2.25% 9/30/2023 350.0 42.0 42.4 0.02%^Bhailal Patel dba New Falls Motel Accommodation Term Loan Prime plus2.75% 3/27/2023 100.0 3.7 3.8 —%^Pegasus Automotive, Inc. Gasoline Stations Term Loan Prime plus2.75% 12/23/2022 112.5 10.9 11.2 0.01%^Delyannis Iron Works Fabricated MetalProductManufacturing Term Loan 6% 12/8/2022 16.0 1.0 1.1 —%^P. Agrino, Inc. dba Andover Diner Food Services andDrinking Places Term Loan Prime plus2.75% 7/18/2021 150.0 8.9 9.1 —%^Golden Elevator Co., Inc. Support Activitiesfor Agriculture andForestry Term Loan Prime plus2.75% 1/31/2022 50.0 0.4 0.4 —%^RJS Service Corporation Gasoline Stations Term Loan Prime plus2.75% 8/20/2021 79.0 6.2 6.3 —%Chez Rurene Bakery Food Services andDrinking Places Term Loan Prime plus2.75% 6/20/2017 150.0 9.2 9.2 —%Total Performing SBAUnguaranteed Investments $235,664.6 $204,850.6 $202,886.6 97.03% Non-Performing SBAUnguaranteed Investments (3) ^200 North 8th Street AssociatesLLC and Enchanted Acres Fa Food Manufacturing Term Loan Prime plus2.75% 5/4/2028 $468.8 $469.3 $441.3 0.21%^214 North Franklin, LLC andWinter Ventures, Inc. Nonstore Retailers Term Loan 6% 11/29/2037 81.7 81.7 29.7 0.01%^A + Quality Home Health Care, Inc. Ambulatory HealthCare Services Term Loan 6% 8/1/2016 1.3 1.3 1.2 —%Almeria Marketing 1, Inc. Personal andLaundry Services Term Loan 7.75% 10/15/2015 4.3 4.3 0.6 —%F-157See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Al-Mustafa Enterprise, Inc. andAl-Mustafa Enterprise Inc Motor Vehicle andParts Dealers Term Loan 6.25% 9/18/2040 129.3 129.5 109.0 0.05%^AUM Estates, LLC and SculptedFigures Plastic Surgery Inc. Ambulatory HealthCare Services Term Loan 6% 3/14/2038 305.3 305.7 28.8 0.01%AWA Fabrication & Construction,L.L.C. Fabricated MetalProductManufacturing Term Loan 6% 4/30/2025 34.7 34.8 19.4 0.01%^B&B Fitness and Barbell, Inc. dbaElevations Health Club Amusement,Gambling, andRecreationIndustries Term Loan 6% 6/22/2035 206.4 206.7 201.6 0.10%Baker Sales, Inc. d/b/a Baker Sales,Inc. Nonstore Retailers Term Loan 6% 3/29/2036 177.0 177.4 80.2 0.04%^Fieldstone Quick Stop LLC(OC)Barber Investments LLC (EPC)Thadius M B Gasoline Stations Term Loan 6% 9/30/2038 646.4 648.0 327.6 0.16%^Barber Investments LLC andFieldstone Quickstop LLC andMaine Dollar D Gasoline Stations Term Loan Prime plus2.75% 8/15/2039 146.0 146.3 — —%Bwms Management, LLC Food Services andDrinking Places Term Loan 0% 3/1/2018 5.1 5.1 4.9 —%^Chickamauga Properties, Inc.,MSW Enterprises, LLP Amusement,Gambling, andRecreationIndustries Term Loan 6.25% 12/22/2035 59.0 59.0 56.4 0.03%^Chickamauga Properties, Inc. andMSW Enterprises, LLP Amusement,Gambling, andRecreationIndustries Term Loan 6.25% 10/19/2022 43.4 43.5 — —%^Custom Software, Inc. a ColoradoCorporation dba M-33 Access Professional,Scientific, andTechnical Services Term Loan 6.25% 6/17/2021 285.5 286.2 43.1 0.02%^Custom Software, Inc. a ColoradoCorporation dba M-33 Access Broadcasting(except Internet) Term Loan 6.25% 4/30/2022 94.1 94.3 — —%^Danjam Enterprises, LLC dbaAriel Dental Care Ambulatory HealthCare Services Term Loan 6% 3/31/2035 172.8 173.0 158.3 0.08%^Danjam Enterprises, LLC dbaAriel Dental Care Ambulatory HealthCare Services Term Loan 6% 3/29/2023 64.7 64.8 58.6 0.03%^DC Realty, LLC dba FOGO DataCenters Professional,Scientific, andTechnical Services Term Loan 6% 3/23/2037 2,646.6 2,673.3 2,609.4 1.25%^DC Realty, LLC dba FOGO DataCenters Professional,Scientific, andTechnical Services Term Loan 6.25% 3/23/2022 178.9 179.3 169.4 0.08%^Dean 1021 LLC dba Pure Pita Food Services andDrinking Places Term Loan Prime plus2.75% 4/29/2025 63.9 64.0 49.6 0.02%^Dill Street Bar and Grill Inc andWO Entertainment, Inc Food Services andDrinking Places Term Loan 6% 9/27/2027 78.2 78.4 1.2 —%Dr. Francis E. Anders, DVM Professional,Scientific, andTechnical Services Term Loan 6% 8/9/2015 1.6 1.6 1.5 —%F-158See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Europlast Ltd Plastics and RubberProductsManufacturing Term Loan 6% 9/26/2022 316.1 316.9 36.5 0.02%^Europlast Ltd Plastics and RubberProductsManufacturing Term Loan 6% 5/31/2023 155.2 155.6 114.8 0.05%^Event Mecca LLC Other InformationServices Term Loan 6% 4/10/2023 12.6 12.6 9.4 —%^EZ Towing, Inc. Support Activitiesfor Transportation Term Loan 6% 1/31/2023 123.2 123.5 107.1 0.05%^Gator Communications GroupLLC dba Harvard Printing Group Printing and RelatedSupport Activities Term Loan 6.25% 3/30/2022 232.9 233.5 22.7 0.01%^Gator Communications GroupLLC dba Harvard Printing Group Printing and RelatedSupport Activities Term Loan 6.25% 4/25/2022 157.4 157.8 — —%^Gator Communications Group,LLC dba Harvard Printing Group Printing and RelatedSupport Activities Term Loan 6.25% 3/27/2023 13.3 13.3 — —%^Grand Manor Realty, Inc. &Kevin LaRoe Real Estate Term Loan 6% 2/20/2023 18.9 19.0 17.8 0.01%Guzman Group,LLC Rental and LeasingServices Term Loan 6% 1/30/2016 189.7 190.2 154.5 0.07%^Hamer Road Auto Salvage, LLCand Scott T. Cook and Nikki J.Cook Motor Vehicle andParts Dealers Term Loan 6% 8/8/2039 176.7 177.1 156.6 0.07%Harrelson MaterialsManagement,Inc Waste Managementand RemediationServices Term Loan 6% 6/24/2021 464.2 465.4 36.4 0.02%^Hartford Cardiology Group LLCand Ideal Nutrition of ConnecticutLLC Ambulatory HealthCare Services Term Loan Prime plus2.75% 6/30/2026 478.9 480.1 127.1 0.06%^Home Again Restaurant LLC Food Services andDrinking Places Term Loan 6.25% 6/30/2040 58.7 58.8 52.9 0.03%^J Olson Enterprises LLC andOlson Trucking Direct, Inc. TruckTransportation Term Loan 6% 6/28/2025 647.5 649.1 226.8 0.11%^J&M Concessions, Inc.dba A-1Liquors Food and BeverageStores Term Loan 6.25% 3/3/2039 130.2 130.6 91.9 0.04%^J&M Concessions Inc dba A 1Liquors Food and BeverageStores Term Loan Prime plus2.75% 2/27/2025 79.8 80.0 11.7 0.01%Jenny's Wunderland, Inc. Social Assistance Term Loan 6% 6/29/2036 149.7 150.1 52.2 0.02%^Karykion, Corporation dbaKarykion Corporation Professional,Scientific, andTechnical Services Term Loan 6% 6/28/2022 144.4 144.8 140.4 0.07%^Kantz LLC and Kantz Auto LLCdba Kantz's Hometown Auto Motor Vehicle andParts Dealers Term Loan Prime plus2.75% 10/29/2039 63.4 63.5 57.2 0.03%Krishna of Orangeburg, Inc. Accommodation Term Loan 6% 2/20/2032 10.3 10.3 5.6 —%^Kup's Auto Spa Inc Repair andMaintenance Term Loan 6.25% 11/15/2038 373.2 374.1 351.8 0.17%Kup’s Auto Spa, Inc. Repair andMaintenance Term Loan 6.25% 10/23/2025 59.1 59.3 55.7 0.03%^Las Torres Development LLC dbaHouston Event Centers Real Estate Term Loan 6% 8/27/2028 51.0 51.0 4.0 —%F-159See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^M and C Renovations Inc Construction ofBuildings Term Loan Prime plus2.75% 10/31/2024 15.9 16.0 12.1 0.01%^Matchless Transportation LLCdba First Class Limo Transit and GroundPassengerTransportation Term Loan 6.25% 8/3/2022 126.4 126.7 17.5 0.01%^Milliken and Milliken, Inc. dbaMilliken Wholesale Distribution MerchantWholesalers,Durable Goods Term Loan 6% 6/10/2036 152.8 152.9 140.3 0.07%^Mojo Brands Media, LLC Broadcasting(except Internet) Term Loan 6% 8/28/2023 723.1 725.0 486.9 0.23%Morris Glass and Construction Specialty TradeContractors Term Loan 6% 3/7/2021 44.8 44.8 3.0 —%^New Paltz Dental Care, PLLC dbaAriel Dental Care Ambulatory HealthCare Services Term Loan 6% 6/19/2025 97.3 97.5 88.4 0.04%Our Two Daughters L.L.C. dbaWashington's Restaurant Food Services andDrinking Places Term Loan 6% 6/18/2026 169.8 170.3 22.7 0.01%^E & I Holdings, LP & PA FarmProducts, LLC Food Manufacturing Term Loan 6% 4/30/2030 1,227.7 1,230.8 436.4 0.21%^NB & T Services, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 4/27/2026 36.5 36.6 — —%Professional Systems, LLC andProfessional Cleaning Administrative andSupport Services Term Loan 6% 7/30/2020 132.0 132.1 7.2 —%^Route 130 SCPI Holdings LLC(EPC) Route 130 SCPI OperationsLLC (OC) d Food Services andDrinking Places Term Loan 6.25% 9/30/2039 535.1 536.4 368.5 0.18%^Seven Stars Enterprises, Inc. dbaAtlanta Bread Company Food Services andDrinking Places Term Loan Prime plus2.75% 6/30/2018 18.8 18.8 18.5 0.01%Sheikh M Tariq dba SelbyvilleFoodrite Gasoline Stations Term Loan 6% 3/13/2023 21.2 21.2 — —%^Shivsakti, LLC dba Knights Inn Accommodation Term Loan 6.25% 12/20/2032 69.7 69.9 62.9 0.03%^STK Ventures Inc dba JP DockService & Supply Specialty TradeContractors Term Loan 6% 5/9/2037 31.6 31.6 2.3 —%Stormwise South Florida dbaStormwise Shutters Specialty TradeContractors Term Loan 6% 11/7/2036 403.1 404.1 324.8 0.16%Stormwise South Florida dbaStormwise Shutters Specialty TradeContractors Term Loan 6% 8/26/2024 201.1 201.6 — —%Tequila Beaches, LLC dba FrescoRestaurant Food Services andDrinking Places Term Loan 6% 9/16/2021 0.2 0.2 0.2 —%^The Conibear Corporation andConibear Trucking, LLC TruckTransportation Term Loan Prime plus2.75% 12/5/2024 7.9 7.9 0.9 —%The Lucky Coyote, LLC MiscellaneousManufacturing Term Loan 6% 5/8/2017 6.2 6.2 2.3 —%^Will Zac Management LLC dbaPapa John's Food Services andDrinking Places Term Loan 6.25% 12/19/2024 42.4 42.5 41.3 0.02%^Winter Ventures Inc and 214 NFranklin LLC Nonstore Retailers Term Loan 6% 4/29/2024 56.5 56.6 — —%^Winter Ventures Inc dbaQualitybargainbooks andQualitybargainmall Nonstore Retailers Term Loan 6% 12/23/2024 149.1 149.3 — —%F-160See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssets^Winter Ventures Inc dbaQualitybargainbooks andQualitybargainmall Nonstore Retailers Term Loan 6% 4/3/2029 134.4 134.5 — —%^Wired LLC and Moulison NorthCorporation Specialty TradeContractors Term Loan 6.25% 6/30/2024 325.2 326.0 306.6 0.15%^Wired LLC and Moulison NorthCorporation Specialty TradeContractors Term Loan 6.25% 7/3/2024 137.9 138.3 13.8 0.01%Woody's Trucking LLC TruckTransportation Term Loan Prime plus2.75% 1/12/2026 11.7 11.7 3.1 —%Total Non-Performing SBAUnguaranteed Investments $14,879.8 $14,933.6 $8,584.6 4.11% Total SBA UnguaranteedInvestments $250,544.4 $219,784.2 $211,471.2 101.14% Performing SBA GuaranteedInvestments (4) HMG Strategy, LLC Professional,Scientific, andTechnical Services Term Loan Prime plus2.75% 12/14/2026 200.0 150.0 165.9 0.08%Techni-Pro Institute LLC Educational Services Term Loan Prime plus2.75% 12/15/2026 760.0 570.0 630.6 0.30%Sempco, Inc. MiscellaneousManufacturing Term Loan Prime plus2.75% 12/15/2041 168.0 126.0 142.3 0.07%Means Enterprises LLC dbaFastFrame Frisco Furniture and HomeFurnishings Stores Term Loan Prime plus2.75% 12/16/2026 150.0 127.5 141.1 0.07%New Image Building Services,Inc.dba The Maids ServicingOakland &Maco Administrative andSupport Services Term Loan Prime plus2.75% 12/21/2026 175.0 131.3 145.2 0.07%Jacliff Investments Inc. dbaInternational health Technologies Publishing Industries(except Internet) Term Loan Prime plus2.75% 12/23/2026 500.0 375.0 414.9 0.20%Joshua L. Baker Insurance Carriersand RelatedActivities Term Loan Prime plus2.75% 12/23/2026 105.0 89.3 98.7 0.05%Sand Hill Associates, Ltd. dbaCharlie O's Tavern on the Point Food Services andDrinking Places Term Loan Prime plus2.75% 12/27/2041 1,679.5 1,259.6 1,420.2 0.68%Fort Smith Wings Inc. dba WingStop Food Services andDrinking Places Term Loan Prime plus2.75% 12/28/2026 130.0 110.5 122.2 0.06%Elite Structures Inc Fabricated MetalProductManufacturing Term Loan Prime plus2.75% 10/27/2029 900.0 675.0 754.3 0.36%Angelo Faia dba AVF Construction Construction ofBuildings Term Loan Prime plus2.75% 5/27/2041 394.9 296.1 334.3 0.16%Franklin Firm LLC dba Luv 2 Play Amusement,Gambling, andRecreation Industries Term Loan Prime plus2.75% 7/15/2041 691.5 518.7 585.4 0.28%F-161See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssetsShooting Sports Academy LLC and Jetaa LLC dbaShooting Sports Academy Amusement,Gambling, andRecreationIndustries Term Loan Primeplus2.75% 6/23/2041 1,500.0 1,125.0 1,268.4 0.61%Worldwide Estate, Inc. dba Washington Heights Manor Nursing andResidential CareFacilities Term Loan Primeplus2.75% 10/21/2041 900.0 467.3 527.7 0.25%Bear Creek Entertainment LLC dba The Woods at BearCreek Accommodation Term Loan Primeplus2.75% 8/12/2041 1,750.0 837.3 944.0 0.45%Nevey's LLC dba Stark Food III Food andBeverage Stores Term Loan Primeplus2.75% 6/30/2041 1,175.5 739.7 833.0 0.40%Sambella Holdings, LLC and Strike Zone EntertainmentCenter LLC Amusement,Gambling, andRecreationIndustries Term Loan Primeplus2.75% 12/24/2041 2,000.0 1,099.4 1,240.3 0.59%Middlesex Auto Sales Corp Motor Vehicleand Parts Dealers Term Loan Primeplus2.75% 10/31/2041 500.0 142.5 160.9 0.08%131 Miles LLC and Ohm Shubh Laxmi, LLC. dba Mr Hero Food Servicesand DrinkingPlaces Term Loan Primeplus2.75% 11/3/2041 510.1 107.5 121.1 0.06%Surgarloaf Concepts LLC dba Fat Biscuit Food Servicesand DrinkingPlaces Term Loan Primeplus2.75% 11/8/2026 675.0 287.6 317.9 0.15%MIK LLC dba Firehouse Subs Food Servicesand DrinkingPlaces Term Loan Primeplus2.75% 11/9/2026 800.0 490.0 542.1 0.26%Roast Beef Levittown LLC dba Arby's Food Servicesand DrinkingPlaces Term Loan Primeplus2.75% 12/13/2026 1,860.0 163.7 180.8 0.09%Imaginarium Foods LLC, Food Servicesand DrinkingPlaces Term Loan Primeplus2.75% 2/28/2042 1,506.9 373.3 421.0 0.20%Total SBA Guaranteed Performing Investments $19,031.4 $10,262.3 $11,512.3 5.51% Total SBA Unguaranteed and Guaranteed Investments $269,575.8 $230,046.5 $222,983.5 106.64% Controlled Investments (5) Advanced Cyber Security Systems, LLC (6)(16) Data processing,hosting andrelated services. 50%MembershipInterest —% — — — — —% Term Loan 3% December2014 1,120.0 381.0 — —%*Automated Merchant Services, Inc. (7) (16) Data processing,hosting andrelated services. 100%CommonStock —% — — — — —%CDS Business Services, Inc.(8) Securities,CommodityContracts, andOther FinancialInvestments andRelated Activities 100%CommonStock —% — — 4,428.0 750.0 0.36% Line ofCredit PrimePlus2.5% August 2018 2,690.0 2,690.0 2,690.0 1.29%F-162See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate(2) Maturity Principal Cost Fair Value % ofNetAssetsCrystalTech Web Hosting, Inc.(11) Dataprocessing,hosting andrelatedservices. 100%CommonStock —% — — 8,434.0 20,109.0 9.62%*Fortress Data Management, LLC(16) Dataprocessing,hosting andrelatedservices. 100%MembershipInterest —% — — — — —%Newtek Insurance Agency, LLC (13)(16) InsuranceCarriers andRelatedActivities 100%MembershipInterests —% — — — 2,500.0 1.20%PMTWorks Payroll, LLC(9) Dataprocessing,hosting andrelatedservices. 100%MembershipInterests —% — — 725.1 860.0 0.41% Term Loan 10%-12% VariousmaturitiesthroughMay 2018 1,685.0 1,685.0 1,185.0 0.57%Secure CyberGateway Services, LLC (10)(16) Dataprocessing,hosting andrelatedservices. 66.7%MembershipInterests —% — — — — —% Term Loan 7% June2017 2,400.0 300.0 — —%Small Business Lending, LLC. (12)(16) Securities,CommodityContracts, andOtherFinancialInvestmentsand RelatedActivities 100%MembershipInterest —% — — — 3,300.0 1.58%Titanium Asset Management LLC (15) (16) Administrativeand SupportServices 100%MembershipInterest —% — — — — —% Term Loan 3% July 2017 2,200.0 660.4 508.1 0.24%ADR Partners, LLC dba banc-serv Partners, LLC (12) Securities,CommodityContracts, andOtherFinancialInvestmentsand RelatedActivities 100%MembershipInterest —% — — 5,260.3 5,400.0 2.58%*Summit Systems and Designs, LLC (14)(16) Dataprocessing,hosting andrelatedservices. 100%MembershipInterest —% — — — — —%Premier Payments LLC (11) Dataprocessing,hosting andrelatedservices. 100%MembershipInterest —% — — 16,438.0 21,000.0 10.04%Universal Processing Services of Wisconsin, LLC (11)(16) Dataprocessing,hosting andrelatedservices. 100%MembershipInterest —% — — — 63,000.0 30.13%Total Controlled Investments $10,095.0 $41,001.8 $121,302.1 58.01% Non-control/Non-affiliate Investments Excel WebSolutions, LLC Dataprocessing,hosting andrelatedservices. Term Loan 10% September2018 $1,020.2 $903.5 $903.5 0.43% Warrants —% — — — — —% $1,020.2 $903.5 $903.5 0.43% Investments in Money Market Funds F-163See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONSOLIDATED SCHEDULE OF INVESTMENTS DECEMBER 31, 2016(In Thousands)Portfolio Company Industry Type ofInvestment InterestRate (2) Maturity Principal Cost Fair Value % of NetAssetsUBS Select Treasury InstitutionalFund - 0.29% yield $9.6 $9.6 $9.6 —%Peapack Gladstone High YieldIMMA - 0.30% yield 25.8 25.8 25.8 0.01%Total Money Market Funds $35.4 $35.4 $35.4 0.02% Total Investments $280,726.4 $271,987.2 $345,224.5 165.10%^ Denotes investment that has been pledged as collateral under the Securitization Trusts.* Denotes non-income producing security.(1) Newtek values each unguaranteed portion of SBA 7(a) performing loans (“Loan”) using a discounted cash flow analysis which projects future cash flowsand incorporates projections for Loan pre-payments and Loan defaults using historical portfolio data. The data predicts future prepayment and defaultprobability on curves which are based on Loan age. The recovery assumption for each Loan is specific to the discounted valuation of the collateralsupporting that Loan. Each Loan’s cash flow is discounted at a rate which approximates a market yield. The Loans were originated under the SBA 7(a)program and conform to the underwriting guidelines in effect at their time of origination. Newtek has been awarded Preferred Lender Program (“PLP”) statusfrom the SBA. The portions of these Loans are not guaranteed by the SBA. Individual loan participations can be sold to institutions which have been grantedan SBA 750 license. Loans can also be sold as a pool of loans in a security form to qualified investors.(2) Prime Rate is equal to 3.50% as of December 31, 2016.(3) Newtek values non-performing SBA 7(a) loans using a discounted cash flow analysis of the underlying collateral which supports the loan. Net recovery ofcollateral, (fair value less cost to liquidate) is applied to the discounted cash flow analysis based upon a time to liquidate estimate. Modified loans are valuedbased upon current payment streams and are re-amortized at the end of the modification period.(4) Newtek values guaranteed performing SBA 7(a) loans using the secondary SBA 7(a) market as a reference point. Newtek routinely sells performing SBA7(a) loans into this secondary market. Guaranteed portions of SBA 7(a) loans partially funded as of the valuation date are valued using level two inputs asdisclosed in Note 3.(5) Controlled Investments are disclosed above as equity investments (except as otherwise noted) in those companies that are “Controlled Investments” of theCompany as defined in the Investment Company Act of 1940. A company is deemed to be a “Controlled Investment” of Newtek Business Services Corp. ifNewtek Business Services Corp. or its subsidiaries owns more than 25% of the voting securities of such company.(6) 50% owned by Wilshire Holdings I, Inc. (a subsidiary of Newtek Business Services Corp.), 50% owned by non-affiliate. The term loan is past its originalmaturity date and currently in default. As such, the fair value of the investment is zero.(7) 96.11% owned by Wilshire Partners, LLC (a subsidiary of Newtek Business Services Corp.), 3.89% owned by Newtek Business Services Corp.(8) 18.35% owned by Wilshire New York Partners IV, LLC (a subsidiary of Newtek Business Services Corp.), 31.8% owned by Wilshire New York Partners V,LLC (a subsidiary of Newtek Business Services Corp.) and 49.85% owned by Wilshire Holdings I, Inc. (a subsidiary of Newtek Business Services Corp.).(9) 25% owned by Wilshire New York Partners V, LLC (a subsidiary of Newtek Business Services Corp.), 65% owned by Wilshire Holdings I, Inc. (asubsidiary of Newtek Business Services Corp.), and 10% owned by Exponential Business Development Co., Inc. (a subsidiary of Newtek Business ServicesCorp.).(10) 66.7% owned by The Whitestone Group, LLC (a subsidiary of Wilshire Holdings I, Inc., a subsidiary of Newtek Business Services Corp.), 33.3% ownedby non-affiliate.(11) 100% owned by Newtek Business Services Holdco 1, Inc. (a subsidiary of Newtek Business Services Corp.).(12) 100% owned by Newtek LSP Holdco, LLC (a subsidiary of Wilshire Holdings I, Inc. and Banc-Serv Acquisition, Inc., both subsidiaries of NewtekBusiness Services Corp.).(13) 100% owned by Wilshire Holdings I, Inc. (a subsidiary of Newtek Business Services Corp.).(14) 100% owned by The Whitestone Group, LLC (a subsidiary of Wilshire Holdings I, Inc., a subsidiary of Newtek Business Services Corp.).F-164See accompanying notes to these consolidated financial statementsTable of Contents(15) 50% owned by Exponential Business Development Co., Inc. (a subsidiary of Newtek Business Services Corp.), 30% owned by Wilshire New YorkPartners V, LLC (a subsidiary of Newtek Business Services Corp.), 17.8% owned by Wilshire New York Partners IV, LLC (a subsidiary of Newtek BusinessServices Corp.), and 2.2% owned by Wilshire New York Advisers II, LLC (a subsidiary of Newtek Business Services Corp.).(16) Zero cost basis is reflected as the portfolio company was organized by the Company and incurred internal legal costs to organize the entity andimmaterial external filing fees which were expensed when incurred.(17) All of the Company's investments are in entities which are organized under the Laws of the United States and have a principal place of business in theUnited States.(18) Under the Investment Company Act of 1940, as amended, the Company may not acquire any non-qualifying assets unless, at the time the acquisition ismade, qualifying assets represent at least 70% of the Company’s total assets. At December 31, 2016, 5.5% of total assets are non-qualifying assets. As ofDecember 31, 2016, the federal tax cost of investments was $263,179,000 resulting in estimated gross unrealized gains and losses of $99,380,000 and$17,335,000, respectively.F-165See accompanying notes to these consolidated financial statementsTable of ContentsNEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTSNOTE 1—DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION:Newtek Business Services Corp. is a Maryland corporation which was formed in August 2013 and is an internally managed,closed end, non-diversified investment company. The Company’s investment strategy is to maximize the investment portfolio’sreturn by generating current income from the debt investments the Company makes and generate dividend income from equityinvestments in controlled portfolio companies.The Company has formed certain Taxable Subsidiaries, which are taxed as corporations for federal income tax purposes. TheseTaxable Subsidiaries allow the Company to hold equity securities of portfolio companies organized as pass-through entitieswhile continuing to satisfy the requirements of a RIC under the Code.The following wholly-owned subsidiaries are consolidated in the financial statements of the Company:•Newtek Small Business Finance, LLC•Newtek Asset Backed Securities, LLC•The Whitestone Group, LLC•Wilshire Colorado Partners, LLC•Wilshire DC Partners, LLC•Wilshire Holdings I, Inc.•Wilshire Louisiana BIDCO, LLC•Wilshire Louisiana Partners II, LLC•Wilshire Louisiana Partners III, LLC•Wilshire Louisiana Partners IV, LLC•Wilshire New York Advisers II, LLC•Wilshire New York Partners III, LLC•Wilshire New York Partners IV, LLC•Wilshire New York Partners V, LLC•Wilshire Partners, LLC•CCC Real Estate Holdings, LLC•Exponential Business Development Co., Inc.•Newtek LSP Holdco, LLC•Newtek Business Services Holdco 1, Inc.•Newtek Business Services Holdco 2, Inc.•Newtek Business Services Holdco 3, Inc.•Newtek Business Services Holdco 4, Inc.•Newtek Business Services Holdco 5, Inc. (formerly Banc-Serv Acquisition, Inc.)F-166Table of ContentsThe consolidated financial statements of the Company have been prepared in accordance with GAAP and pursuant to the requirements for reporting onForm 10-K and Article 6 or 10 of Regulation S-X. In the opinion of management, the consolidated financial statements reflect all adjustments andreclassifications that are necessary for the fair presentation of financial results as of and for the periods presented. All intercompany balances and transactionshave been eliminated. Certain prior period amounts have been reclassified to conform to the current period presentation.Except as otherwise noted, all financial information included in the tables in the following footnotes is stated in thousands, except per share data.NOTE 2—SIGNIFICANT ACCOUNTING POLICIES:Fair ValueThe Company applies fair value accounting to certain of its financial instruments in accordance with ASC Topic 820 — Fair Value Measurement (“ASCTopic 820”). ASC Topic 820 defines fair value, establishes a framework used to measure fair value and requires disclosures for fair value measurements. Inaccordance with ASC Topic 820, the Company has categorized its financial instruments carried at fair value, based on the priority of the valuation technique,into a three-level fair value hierarchy. Fair value is a market-based measure considered from the perspective of the market participant who holds the financialinstrument rather than an entity-specific measure. Therefore, when market assumptions are not readily available, the Company’s own assumptions are set toreflect those that management believes market participants would use in pricing the financial instrument at the measurement date. The availability of observable inputs can vary depending on the financial instrument and is affected by a wide variety of factors, including, for example, thetype of product, whether the product is new, whether the product is traded on an active exchange or in the secondary market and the current marketconditions. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market the determination of fair valuerequires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for financial instrumentsclassified as Level 3. Any changes to the valuation methodology are reviewed by management and the Board to confirm that the changes are appropriate. As markets change, newproducts develop and the pricing for products becomes more or less transparent, the Company will continue to refine its valuation methodologies. See furtherdescription of fair value methodology in Note 3.Use of EstimatesThe preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect thereported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, and thereported amounts of revenue and expense during the reporting period. The level of uncertainty in estimates and assumptions increases with the length of timeuntil the underlying transactions are complete. Actual results could differ from those estimates.Consolidation As provided under Regulation S-X and ASC Topic 946, the Company will generally not consolidate its investment in a company other than an investmentcompany subsidiary or a controlled operating company whose business consists of providing services to the Company.As of July 1, 2016, the Company determined that Exponential, previously a controlled portfolio company, met the criteria for consolidation under ASCTopic 946. This determination was based on Exponential's purchase of membership interests in two controlled portfolio companies during the yearended December 31, 2016.Assets related to transactions that do not meet ASC Topic 860 — Transfers and Servicing (“ASC Topic 860”) requirements for accounting sale treatment arereflected in the Company’s consolidated statements of assets and liabilities as investments. Those assets are owned by the securitization trusts, and areincluded in the Company’s consolidated financial statements. The creditors of the special purpose entities have received security interests in such assets andsuch assets are not intended to be available to the creditors of the Company.F-167Table of ContentsDistributionsDividends and distributions to the Company’s common stockholders are recorded on the declaration date. The timing and amount to be paid out as adividend or distribution is determined by the Company’s Board each quarter and is generally based upon the taxable earnings estimated by management. Cash and Cash EquivalentsThe Company considers all highly liquid investments with maturities of three months or less when purchased to be cash equivalents. Invested cash is heldalmost exclusively at financial institutions of high credit quality. The Company invests cash not held in interest free checking accounts or bank moneymarket accounts mainly in U.S. Treasury only money market instruments. As of December 31, 2017, cash deposits in excess of insured amountstotaled $5,609,000. The Company has not experienced any losses with respect to cash balances in excess of insured amounts and management does notbelieve there was a significant concentration of risk with respect to cash balances as of December 31, 2017.Restricted CashRestricted cash includes amounts due on SBA loan-related remittances to third parties and cash reserves associated with securitization transactions. As ofDecember 31, 2017, total restricted cash was $18,074,000.Broker ReceivableBroker receivable represents amounts due from third parties for loans which have been traded at period end but have not yet settled.Income TaxesDeferred tax assets and liabilities are computed based upon the differences between the financial statement and income tax basis of assets and liabilities usingthe enacted tax rates in effect for the year in which those temporary differences are expected to be realized or settled. If available evidence suggests that it ismore likely than not that some portion or all of the deferred tax assets will not be realized, a valuation allowance is required to reduce the deferred tax assetsto the amount that is more likely than not to be realized.The Company’s U.S. federal and state income tax returns prior to fiscal year 2014 are generally closed, and management continually evaluates expiringstatutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings.The Company has elected to be treated as a RIC under the Code beginning with the 2015 tax year and operates in a manner so as to continue to qualify forthe tax treatment applicable to RICs. The RIC tax return includes Newtek Business Services Corp. and NSBF, a single member LLC disregarded for taxpurposes. None of the Company’s other subsidiaries are included in the RIC tax return. The Company will evaluate and record any deferred tax assets andliabilities of the subsidiaries that are not included in the RIC tax return. In order to maintain its RIC tax treatment, among other things, the Company isrequired to meet certain source of income and asset diversification requirements and timely distribute to its stockholders at least 90% of investment companytaxable income, as defined by the Code, for each tax year. The Company intends to make the requisite distributions to its stockholders, which will generallyrelieve the Company from U.S. federal income taxes with respect to any income that is distributed to its stockholders as dividends.Depending on the level of taxable income earned in a tax year, the Company may choose to retain taxable income in excess of current year dividenddistributions, and would distribute such taxable income in the next tax year. The Company would then pay a 4% excise tax on such income, as required. Tothe extent that the Company determines that its estimated current year annual taxable income, determined on a calendar year basis, could exceed estimatedcurrent calendar year dividend distributions, the Company accrues excise tax, if any, on estimated excess taxable income as taxable income is earned. For theyears ended December 31, 2017, 2016 and 2015, no U.S. federal excise taxes were due.The Company’s Taxable Subsidiaries accrue income taxes payable based on the applicable corporate rates on the net unrealized appreciation generated bythe controlled investments held by the Taxable Subsidiaries. Such deferred tax liabilities amounted to $8,164,000 and $5,983,000 at December 31, 2017 and2016, respectively, and are recorded as deferred tax liabilities on the consolidated statements of assets and liabilities. The change in deferred tax liabilities isincluded as a component of net unrealized appreciation (depreciation) on investments in the consolidated statements of operations.F-168Table of ContentsInvestment IncomeInterest on debt investments is accrued and included in income based on contractual rates applied to principal amounts outstanding. Interest income isdetermined using a method that results in a level rate of return on principal amounts outstanding. When a loan becomes 90 days or more past due, or if weotherwise do not expect to receive interest and principal repayments, the loan is placed on non-accrual status and the recognition of interest income isdiscontinued. Interest payments received on loans that are on non-accrual status are treated as reductions of principal until the principal is repaid.Dividend income is recognized on an accrual basis for preferred equity securities to the extent that such amounts are expected to be collected or realized. Indetermining the amount of dividend income to recognize, if any, from cash distributions on common equity securities, we will assess many factors includinga portfolio company’s cumulative undistributed income and operating cash flow. Cash distributions from common equity securities received in excess ofsuch undistributed amounts are recorded first as a reduction of our investment and then as a realized gain on investment.The Company earns servicing income related to the guaranteed portions of SBA loan investments which it sells into the secondary market. These recurringfees are earned daily and recorded when earned. Servicing income is earned for the full term of the loan or until the loan is repaid.The Company earns a variety of fees from borrowers in the ordinary course of conducting its business, including packaging, legal, late payment andprepayment fees. All other income is recorded when earned. Other income is generally non-recurring in nature and earned as “one time” fees in connectionwith the origination of new debt investments with non-affiliates.Investment transactions are accounted for on a trade-date basis. Realized gains or losses on investments are measured by the difference between the netproceeds from the disposition and the cost basis of investment, without regard to unrealized gains or losses previously recognized. The Company reportscurrent period changes in the fair value of investments as a component of the net change in unrealized appreciation (depreciation) on investments in theconsolidated statements of operations.Stock – Based CompensationThe Company accounts for its equity-based compensation plan using the fair value method, as prescribed by ASC Topic 718, Stock Compensation.Accordingly, for restricted stock awards, the Company measures the grant date fair value based upon the market price of the Company’s common stock on thedate of the grant and amortizes this fair value to salaries and benefits ratably over the requisite service period or vesting term.New Accounting StandardsIn November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues TaskForce),” which requires that the statement of cash flow explain the change during the period in the total of cash, cash equivalents, and amounts generallydescribed as restricted cash or restricted cash equivalents. Amounts generally described as restricted cash and restricted cash equivalents should be includedwith cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This ASU iseffective for annual reporting periods beginning after December 15, 2017, and interim periods within those periods. Early adoption is permitted. This ASUwill not have a material impact on the Company’s consolidated financial statements and disclosures.In February 2016, the FASB issued ASU 2016-02, “Leases,” which amends various aspects of existing accounting guidance for leases, including therecognition of a right of use asset and a lease liability for leases with a duration of greater than one year. The ASU is effective for annual reporting periodsbeginning after December 15, 2018, and interim periods within those periods. Early adoption is permitted. The Company has not completed its review of thenew guidance; however, the Company anticipates that upon adoption of the standard it will recognize additional assets and corresponding liabilities relatedto leases on its consolidated statements of assets and liabilities.In January 2016, the FASB issued ASU 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets andFinancial Liabilities”, which, among other things, requires an entity to present separately in other comprehensive income the portion of the total change inthe fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value inaccordance with the fair value option for financial instruments. Additionally, the ASU changes the disclosure requirements for financial instruments. ThisASU is effective for annual reporting periods beginning after December 15, 2017, and interim periods within those periods, andF-169Table of Contentsearly adoption is permitted for certain provisions. The Company does not believe this ASU will have a material impact on its consolidated financialstatements and disclosures.In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”. ASU 2014-09 supersedes the revenue recognitionrequirements under ASC 605, “Revenue Recognition”, and most industry-specific guidance throughout the Industry Topics of the ASC. The core principle ofthe guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects theconsideration to which an entity expects to be entitled in exchange for those goods or services. Under the new guidance, an entity is required to perform thefollowing five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price;(4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the entity satisfies a performanceobligation. The new guidance will significantly enhance comparability of revenue recognition practices across entities, industries, jurisdictions and capitalmarkets. Additionally, the guidance requires improved disclosures as to the nature, amount, timing and uncertainty of revenue that is recognized. In March2016, the FASB issued ASU 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting RevenueGross versus Net)”, which clarified the implementation guidance on principal versus agent considerations. In April 2016, the FASB issued ASU 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing”, which clarified the implementationguidance regarding performance obligations and licensing arrangements. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts withCustomers (Topic 606)—Narrow-Scope Improvements and Practical Expedients”, which clarified guidance on assessing collectability, presenting sales tax,measuring noncash consideration, and certain transition matters. In December 2016, the FASB issued ASU No. 2016-20, “Revenue from Contracts withCustomers (Topic 606)—Technical Corrections and Improvements”, which provided disclosure relief, and clarified the scope and application of the newrevenue standard and related cost guidance. The ASU is effective for annual reporting periods beginning after December 15, 2017, and interim periods withinthat reporting period. The Company has evaluated the guidance under Topic 606 and expects to identify similar performance obligations under ASC 606 ascompared with deliverables and separate units of account previously identified. The Company evaluated each revenue stream and concluded that all werecovered by the scope exceptions as detailed in Topic 606. As a result, the Company expects timing of its revenue recognition to remain the same.SegmentsThe Company has determined that it has a single reporting segment and operating unit structure. The Company issues debt and makes equity investments inportfolio companies in various industries. The Company separately evaluates the performance of each of its lending and investment relationships. However,because each of these debt and equity investment relationships have similar business and economic characteristics, they have been aggregated into a singlelending and investment segment.ReclassificationsCertain prior period amounts have been reclassified to conform to the current period presentation.NOTE 3—FAIR VALUE MEASUREMENTSFair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction betweenmarket participants at the measurement date. In determining fair value, management uses various valuation approaches, all of which have been approved bythe Company’s Board. In accordance with GAAP, a fair value hierarchy for inputs is used in measuring fair value that maximizes the use of observable inputsand minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available.The fair value hierarchy gives the highest priority (Level 1) to quoted prices in active markets for identical assets or liabilities and gives the lowest priority tounobservable inputs (Level 3). An asset or liability’s classification within the fair value hierarchy is based on the lowest level of significant input to itsvaluation. The levels of the fair value hierarchy are as follows:F-170Table of Contents Level 1 Quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities and derivativecontracts that are traded in an active exchange market, as well as certain U.S. Treasury, other U.S. Government and agency mortgage-backeddebt securities that are highly liquid and are actively traded in over-the-counter markets. Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, orother inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments and derivativecontracts whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from orcorroborated by observable market data. This category generally includes certain U.S. Government and agency mortgage-backed debt securities,corporate debt securities, derivative contracts and residential mortgage loans held-for-sale. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, orsimilar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.This category generally includes certain private equity investments, retained residual interests in securitizations, residential mortgage servicingrights, and highly structured or long-term derivative contracts.In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset or a liability’scategorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’sassessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the assetor liability. The Company assesses the levels of assets and liabilities at each measurement date, and transfers between levels are recognized on the actual dateof the event or change in circumstances that caused the transfers. There were no transfers among Level 1, 2 and 3 of the fair value hierarchy for assets andliabilities during the years ended December 31, 2017 or 2016. The following section describes the valuation techniques used by the Company to measuredifferent assets and liabilities at fair value and includes the level within the fair value hierarchy in which the assets and liabilities are categorized.Level 1 investments are valued using quoted market prices. Level 2 investments are valued using market consensus prices that are corroborated byobservable market data and quoted market prices for similar assets and liabilities. Level 3 investments are valued at fair value as determined in good faith bythe Board, based on input of management, the audit committee and independent valuation firms that have been engaged at the direction of the Board to assistin the valuation of certain portfolio investments without a readily available market quotation at least once during a trailing twelve-month period under avaluation policy and a consistently applied valuation process. When determining fair value of Level 3 debt and equity investments, the Company may take into account the following factors, where relevant: theenterprise value of a portfolio company, the nature and realizable value of any collateral, the portfolio company’s ability to make payments, its earnings anddiscounted cash flows, the markets in which the portfolio company does business, comparisons to publicly traded securities, changes in the interest rateenvironment and the credit markets generally that may affect the price at which similar investments may be made and other relevant factors. The primarymethods for determining enterprise value include a discounted cash flow analysis and a multiple analysis whereby appropriate multiples are applied to theportfolio company’s EBITDA or revenue. The enterprise value analysis is performed to determine the value of equity investments and to determine if debtinvestments are credit impaired. If debt investments are credit impaired, the Company will use the enterprise value analysis or a liquidation basis analysis todetermine fair value. For debt investments that are not determined to be credit impaired, the Company uses a market interest rate yield analysis to determinefair value. In addition, for certain debt investments, the Company may base its valuation on quotes provided by an independent third party broker. Due to the inherent uncertainty of determining the fair value of Level 3 investments that do not have a readily available market value, the fair value of theinvestments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materiallyfrom the values that may ultimately be received or settled. Further, such investments are generally subject to legal and other restrictions or otherwise are lessliquid than publicly traded instruments. If the Company were required to liquidate a portfolio investment in a forced or liquidation sale, the Company mayrealize significantly less than the value at which such investment had previously been recorded. F-171Table of ContentsThe Company’s investments are subject to market risk. Market risk is the potential for changes in the value due to market changes. Market risk is directlyimpacted by the volatility and liquidity in the markets in which the investments are traded.The following tables present fair value measurements of the Company’s assets and liabilities measured at fair value and indicates the fair value hierarchy ofthe valuation techniques utilized by the Company to determine such fair values as of December 31, 2017 and 2016: Fair Value Measurements at December 31, 2017 using: Total Level 1 Level 2 Level 3Assets Investments in money markets funds$9 $9 $— $—SBA unguaranteed non-affiliate investments278,034 — — 278,034SBA guaranteed non-affiliate investments25,490 — 25,490 —Controlled investments153,156 — — 153,156Other real estate owned (1)1,121 — 1,121 —Servicing assets19,359 — — 19,359Total assets$477,169 $9 $26,611 $450,549Liabilities Contingent consideration liabilities (2)$913 $— $— $913(1) Included in Other Assets on the Consolidated Statements of Assets and Liabilities.(2) Included in Accounts Payable, Accrued Expenses and Other Liabilities on the Consolidated Statements of Assets and Liabilities. Refer to Note 4.For the year ended December 31, 2017, the change in unrealized appreciation (depreciation) included in the consolidated statement of operations attributableto Level 3 investments still held at December 31, 2017 includes $1,342,000 in unrealized depreciation on SBA unguaranteed non-affiliate investments,$12,957,000 in unrealized appreciation on controlled investments, and $3,394,000 in unrealized depreciation on servicing assets. Fair Value Measurements at December 31, 2016 using: Total Level 1 Level 2 Level 3Assets Investments in money markets funds$35 $35 $— $—SBA unguaranteed non-affiliate investments211,471 — — 211,471SBA guaranteed non-affiliate investments11,512 — 11,512 —Controlled investments121,302 — — 121,302Other real estate owned (1)875 — 875 —Non-control/non-affiliate investments904 — — 904Servicing assets16,246 — — 16,246Total assets$362,345 $35 $12,387 $349,923(1) Included in Other Assets on the Consolidated Statements of Assets and LiabilitiesFor the year ended December 31, 2016, the change in unrealized appreciation (depreciation) included in the consolidated statement of operations attributableto Level 3 investments still held at December 31, 2016 includes $102,000 in unrealized appreciation on SBA unguaranteed non-affiliate investments,$11,337,000 in unrealized appreciation on controlled investments, $43,000 in unrealized depreciation on non-control/non-affiliate investments and$2,269,000 in unrealized depreciation on servicing assets.F-172Table of ContentsThe following tables provide a summary of quantitative information about the Company’s Level 3 fair value measurements as of December 31, 2017 and2016. In addition to the techniques and inputs noted in the table below, according to our valuation policy we may also use other valuation techniques andmethodologies when determining our fair value measurements. The tables below are not intended to be all-inclusive, but rather provide information on thesignificant Level 3 inputs as they relate to the Company’s fair value measurements at December 31, 2017 and 2016. Range Fair Value as ofDecember 31, 2017 Valuation Techniques Unobservable Input WeightedAverage Minimum MaximumAssets: SBA unguaranteednon-affiliateinvestments -performing loans $266,467 Discounted cash flow Market yields 5.60% 5.60% 5.60%SBA unguaranteednon-affiliateinvestments - non-performing loans $11,567 Discounted cash flow Market yields 5.84% 5.84% 5.84%Controlled equityinvestments (A) $142,950 Market comparablecompanies EBITDA multiples (B) 7.45x 3.54x 9.00x Market comparablecompanies Revenue multiples (B) 1.08x 0.21x 2.55x Discounted cash flow Weighted average cost ofcapital (B) 13.12% 11.40% 22.47% $2,450 Recent transaction N/A N/A N/A N/AControlled debtinvestments $7,396 Discounted cash flow Market yields 6.70% 4.75% 7.00% $360 Liquidation value Asset value N/A N/A N/AServicing assets $19,359 Discounted cash flow Market yields 13.06% 13.06% 13.06%Liabilities: Contingentconsiderationliabilities $913 Discounted cash flow Projected EBITDA andprobability of achievement N/A N/A N/A(A) In determining the fair value of the Company’s controlled equity investments as of December 31, 2017, the proportion of the market comparablecompanies valuation technique and the discounted cash flow valuation technique were 45.1% and 54.9%, respectively, on a weighted average basis.(B) The Company valued $129,020,000 of investments using an equal weighting of EBITDA and revenue multiples and none of its investments using onlyrevenue multiples in the overall valuation approach which included the use of market comparable companies. The Company valued $13,930,000 ofinvestments using only discounted cash flows.F-173Table of Contents Range Fair Value as ofDecember 31, 2016 Valuation Techniques Unobservable Input WeightedAverage Minimum MaximumAssets: SBA unguaranteednon-affiliateinvestments -performing loans $202,887 Discounted cash flow Market yields 5.50% 5.50% 5.50%SBA unguaranteednon-affiliateinvestments - non-performing loans $8,584 Discounted cash flow Market yields 6.19% 6.19% 6.19%Controlled equityinvestments (A)(B) $116,919 Market comparablecompanies EBITDA multiples (B) 6.10x 3.01x 6.99x Market comparablecompanies Revenue multiples (B) 1.21x 0.62x 3.08x Discounted cash flow Weighted average cost ofcapital (B) 12.57% 11.00% 15.30%Controlled debtinvestments $3,875 Discounted cash flow Market yields 7.05% 5.75% 10.00% $508 Liquidation value Asset value N/A N/A N/ANon-control/non-affiliate debtinvestments $904 Liquidation value Asset value N/A N/A N/AServicing assets $16,246 Discounted cash flow Market yields 12.20% 12.20% 12.20%(A) In determining the fair value of the Company’s controlled investments as of December 31, 2016, the proportion of the market comparable companiesvaluation technique and the discounted cash flow valuation technique were 46.1% and 53.9%, respectively, on a weighted average basis.(B) The Company valued $106,609,000 of investments using an equal weighting of EBITDA and revenue multiples and $860,000 of investments using onlyrevenue multiples in the overall valuation approach which included the use of market comparable companies. The Company valued $9,450,000 ofinvestments using only discounted cash flows.The following tables present the changes in investments, servicing assets and liabilities measured at fair value using Level 3 inputs for the years endedDecember 31, 2017 and 2016:F-174Table of Contents December 31, 2017 SBAUnguaranteedInvestments ControlledInvestments Non-Control/Non-AffiliateInvestments ServicingAssets ContingentConsiderationLiabilitiesFair value, December 31, 2016$211,471 $121,302 $904 $16,246 $—Net change in unrealized (depreciation) appreciation(1,342) 12,957 — (3,394) —Realized loss(894) (300) — — —SBA unguaranteed non-affiliate investments, funded89,762 — — — —Foreclosed real estate acquired(503) — — — —Purchase of investments— 35,188 3,255 — —Purchase of loans from SBA6,469 — — — —Purchase of loan portfolio175 — — — —Transfer of Excel WebSolutions, LLC from Non-control/Non-affiliate to Controlled Investments— 904 (904) — —Record fair value of contingent consideration liabilities— — — — 1,368Change in fair value of contingent consideration liabilities— — — — (455)Net accretion of premium/discount19 — — — —Return of investment— (50) — — —Principal payments received on debt investments(27,123) (16,845) (3,255) — —Additions to servicing assets— — — 6,507 —Fair value, December 31, 2017$278,034 $153,156 $— $19,359 $913 December 31, 2016 SBAUnguaranteedInvestments ControlledInvestments Non-Control/Non-AffiliateInvestments Servicing AssetsFair value, December 31, 2015$158,355 $104,376 $1,824 $13,042Net change in unrealized appreciation (depreciation)18 11,337 (43) (2,269)Realized loss(925) — — —SBA unguaranteed non-affiliate investments, funded74,239 — — —Foreclosed real estate acquired(446) — — —Purchase of investments— 8,595 1,020 —Transfer from due from related parties— 435 — —Transfer of Titanium Asset Management LLC from Non-control/Non-affiliate toControlled Investments— 1,146 (1,146) —Purchase of loan from SBA2,057 — — —Return of investment— (535) — —Principal payments received on debt investments(21,827) (4,052) (751) —Additions to servicing assets— — — 5,473Fair value, December 31, 2016$211,471 $121,302 $904 $16,246NOTE 4—INVESTMENTS:Investments, all of which are with portfolio companies in the United States, consisted of the following at December 31, 2017 and 2016:F-175Table of Contents December 31, 2017 December 31, 2016 Cost Fair Value Cost Fair ValueMoney market funds $9 $9 $35 $35Non-affiliate debt investments 310,531 303,524 230,950 223,887Controlled investments Equity 48,835 145,400 35,285 116,919Debt 11,063 7,756 5,716 4,383Total investments $370,438 $456,689 $271,986 $345,224In April 2017, the Company invested in 100% of the common stock of a new wholly-owned, controlled portfolio company, IPM. IPM provides consulting,design and implementation of technology solutions for enterprise and commercial clients. Total consideration for the investment was $11,120,000 andconsisted of $1,000,000 in restricted shares of Newtek common stock, $8,752,000 in cash and $1,368,000 to be paid in cash in two equal installments in2018 and 2019 based on IPM attaining specific EBITDA levels for 2017 and 2018. As of December 31, 2017, the fair value of the contingent considerationliabilities was $913,000 and is included in Accounts Payable, Accrued Expenses and Other Liabilities on the consolidated statement of assets and liabilities.During the third quarter of 2017, a portion of IPM’s business was spun off into a new wholly-owned controlled portfolio company, SIDCO. As a result, theunderlying IPM business has not changed.On October 24, 2017, the Company invested in 100% of the membership interests of a new wholly-owned, controlled portfolio company, UCS, which is alead generator for commercial financing companies. Total consideration paid by the Company was $3,050,000 and consisted of $500,000 in restricted sharesof Newtek common stock and $1,950,000 in cash, with the $600,000 balance to be paid in cash and Newtek common stock, in two equal installments in 2019and 2020 based on UCS attaining specific EBITDA targets for 2018 and 2019. As of December 31, 2017, the fair value of the contingent considerationliabilities was zero.The following table shows the Company’s portfolio investments by industry at December 31, 2017 and 2016:F-176Table of Contents December 31, 2017 December 31, 2016Industry Cost Fair Value Cost Fair ValueData Processing, Hosting, and Related Services $29,152 $115,875 $29,010 $107,180Food Services and Drinking Places 31,929 31,822 21,941 21,702Professional, Scientific, and Technical Services 31,471 31,241 12,240 11,582Securities, Commodity Contracts, and Other Financial Investments and Related Activities 19,326 23,489 12,909 12,649Amusement, Gambling, and Recreation Industries 21,408 22,284 18,486 18,995Truck Transportation 20,115 19,005 7,469 6,938Ambulatory Health Care Services 14,863 14,537 13,068 11,976Repair and Maintenance 13,762 14,285 12,066 12,228Accommodation 9,602 10,253 9,455 9,849Specialty Trade Contractors 9,768 9,032 8,311 7,595Fabricated Metal Product Manufacturing 8,281 8,424 5,922 5,961Social Assistance 7,393 7,549 4,903 4,905Food Manufacturing 9,362 6,906 5,596 4,873Personal and Laundry Services 6,678 6,788 4,255 4,206Merchant Wholesalers, Durable Goods 6,736 6,693 6,211 5,989Gasoline Stations 6,646 6,409 5,938 5,570Building Material and Garden Equipment and Supplies Dealers 5,752 5,750 4,439 4,328Administrative and Support Services 5,909 5,371 6,379 5,727Construction of Buildings 5,133 5,355 1,708 1,747Performing Arts, Spectator Sports, and Related Industries 4,716 5,116 1,854 1,819Food and Beverage Stores 5,143 5,114 5,221 5,194Rental and Leasing Services 5,590 5,056 1,741 1,615Transit and Ground Passenger Transportation 5,233 4,943 1,836 1,703Motor Vehicle and Parts Dealers 4,879 4,904 5,059 5,051Other 81,591 80,488 65,969 65,842Total $370,438 $456,689 $271,986 $345,224NOTE 5—TRANSACTIONS WITH AFFILIATED COMPANIES AND RELATED PARTY TRANSACTIONS:Transactions with Affiliated CompaniesAn affiliated company is a company in which the Company has an ownership of 5% or more of its voting securities. A controlled affiliate is a company inwhich the Company owns more than 25% of its voting securities. Transactions related to our investments with controlled affiliates for the year endedDecember 31, 2017 were as follows:F-177Table of ContentsPortfolio Company Fair value atDecember 31,2016 Purchases(cost) Principalreceived(cost) Net realizedgains/(losses) Net unrealizedgains/(losses) Fair value atDecember 31,2017 Interest andother income DividendincomeControlled Investments Universal Processing Services ofWisconsin, LLC $63,000 $— $— $— $17,000 $80,000 $— $7,100Premier Payments LLC 21,000 — — — 2,000 23,000 — 1,575Newtek Technology Solutions,Inc. 20,109 — (50) — (7,659) 12,400 — —International ProfessionalMarketing, Inc. (1) — 5,450 (1,000) — — 4,450 10 550SIDCO, LLC — 7,915 (245) — — 7,670 6 225banc-serv Partners, LLC 5,400 30 — — (2,000) 3,430 — —CDS Business Services, Inc. 3,440 18,343 (14,637) — 7,250 14,396 544 200Small Business Lending, LLC 3,300 — — — (800) 2,500 — —Newtek Insurance Agency, LLC 2,500 — — — — 2,500 — —PMTWorks Payroll, LLC 2,045 1,000 — — (3,045) — — —Titanium Asset ManagementLLC 508 — (466) — (42) — 6 —Excel WebSolutions, LLC 904 — (497) — (47) 360 68 —United Capital Source, LLC — 2,450 — — — 2,450 — 50Summit Systems and Designs,LLC — — — — — — 54 —Secure CyberGateway Services,LLC — — — (300) 300 — 19 47Total Controlled Investments $122,206 $35,188 $(16,895) $(300) $12,957 $153,156 $707 $9,747(1) Refer to Note 4 for discussion of investment in IPM.Prior to January 2017, EWS was a non-control/non-affiliate investment. During the year ended December 31, 2017, the Company exercised warrants topurchase a 50% membership interest in EWS. Interest, fees, and dividends attributable to the investment in EWS that were credited to income prior to January2017 are included in investment income from non-affiliate investments on the consolidated statements of operations.During the year ended December 31, 2017, a portion of IPM’s business was spun off into a new wholly-owned controlled portfolio company, SIDCO. As aresult, the underlying IPM business has not changed. The Company determined the cost basis of its investments in IPM and SIDCO to be $4,000,000 and$7,120,000, respectively. Refer to Note 4.Related Party TransactionsNotes Payable - Related PartiesIn June 2015, the Company entered into the Related Party RLOC. Maximum borrowings under the Related Party RLOC were $38,000,000.In June 2017, the Related Party RLOC was amended to increase maximum borrowings to $50,000,000. The outstanding balance bears interest at a rate equalto (a) LIBOR (with a floor of 0.50%) plus (b) 6% or at a rate equal to (y) the greater of the Prime Rate or 3.5% plus (z) 5%. At December 31, 2017, the RelatedParty RLOC bears interest at a rate of 7.69%. The Related Party RLOC has a maturity date of June 21, 2021. Outstanding borrowings at December 31, 2017were $7,001,000. For the years ended December 31, 2017, 2016 and 2015, interest expense was $780,000, $260,000 and $621,000, respectively.F-178Table of ContentsExpenses Incurred from Controlled Portfolio CompaniesThe Company incurs expenses from certain controlled portfolio companies including managed technology services from NTS, loan related processing andauditing expenses and referral fees from various related parties and payroll processing fees from NPS. December 31, 2017 December 31, 2016 December 31, 2015Managed technology services $836 $969 $599Loan related processing and auditing fees 127 36 255Referral fees 167 23 —Payroll processing fees 38 35 22Total $1,168 $1,063 $876Lake Success, New York OfficesBeginning in April 2016, the Company began sub-leasing portions of its office space in Lake Success, New York to certain portfolio companies. Amountscharged for the years ended December 31, 2017 and 2016 were as follows:Portfolio CompanyDecember 31, 2017 December 31, 2016Small Business Lending, LLC$81 $104CDS Business Services, Inc.63 80PMTWorks Payroll, LLC46 30Universal Processing Services of Wisconsin, LLC147 32Newtek Insurance Agency, LLC86 46Titanium Asset Management LLC13 4United Capital Source, LLC7 —Premier Payments LLC46 57Total$489 $353Managerial Assistance Fees from Controlled InvestmentsThe Company offers managerial assistance to all portfolio companies and currently provides managerial assistance to certain controlled portfolio companies.Amounts are charged based on estimates of time and effort spent by certain employees providing managerial services for certain controlled portfoliocompanies. Fees are recorded on a quarterly basis, are recurring in nature and are charged at an arm’s length basis. The table below summarizes amountscharged to each controlled portfolio company for the years ended December 31, 2017, 2016 and 2015. The amounts are recorded as a credit to salaries andbenefits in the consolidated statements of operations.F-179Table of ContentsPortfolio Company December 31, 2017 December 31, 2016 December 31, 2015Universal Processing Services of Wisconsin, LLC $407 $468 $590Newtek Technology Solutions, Inc. 543 654 528PMTWorks Payroll, LLC 75 96 149Newtek Insurance Agency, LLC 204 235 241Summit Systems and Designs, LLC 10 26 30Secure CyberGateway Services, LLC 2 1 45banc-serv Partners, LLC 215 110 —Premier Payments LLC 163 192 45CDS Business Services, Inc. 35 — —International Professional Marketing, Inc. 72 — —SIDCO, LLC 52 — —Small Business Lending, LLC 364 525 176Total $2,142 $2,307 $1,804Other Transactions with Related PartiesIn December 2015, the Company sold a portfolio of health-related insurance policies to NIA for $407,000. The carrying value of the portfolio at the time ofsale was $308,000 which resulted in gain on sale of $99,000 which is included in other income from controlled investments on the consolidated statementsof operations. The purchase price was calculated based on one times the trailing twelve month gross commissions earned from the remaining active policies.In July 2015, the Company entered into a consulting agreement (the “Agreement”), with Jeffrey Rubin, former President of Newtek and former CEO ofPremier. The Agreement retained Jeffrey Rubin to perform business development consulting services. The Agreement entitled Jeffrey Rubin to annualcompensation of $200,000 paid monthly. During the year ended December 31, 2015, the Company incurred approximately $83,000 in consulting feesrelated to the Agreement. The Agreement was terminated in December 2015 and no additional payments are required to be made. On January 1, 2016, JeffreyRubin entered into an independent sale agent agreement with Premier.During the year ended December 31, 2015, the Company earned $51,000 in consulting fees and other income from related parties.In September 2016, the Company entered into an advisory services agreement (the “AK Agreement”) with AK Capital, LLC (“AK Capital”). The Company’sChief Executive Officer is a director of AK Capital. AK Capital provides consulting and advisory services to the Company in connection with the sale and/orsecuritization of participations in SBA guaranteed and unguaranteed SBA 7(a) loans. The AK Agreement contains total fees of $10,000, to be paid monthlyover one year. During the years ended December 31, 2017 and 2016, the Company incurred $7,000 and $3,000 in fees respectively, from AK Capital.A member of the Company’s Board and audit committee chairman receives a pension from CohnReznick LLP and capital payouts from his partnershipinterests. CohnReznick LLP performs various tax services for the Company.The spouse of the Chief Accounting Officer of the Company is the Controller of certain of the Company’s controlled portfolio companies and is paid anannual salary in excess of $125,000.The nephew and brother of the Chief Executive Officer of the Company are employed by certain of the Company’s controlled portfolio companies and earnannual salaries in excess of and less than $125,000, respectively.As of December 31, 2017, the Company had $2,255,000 due from related parties and no amounts due to related parties. At December 31, 2016, the Companyhad $3,748,000 due from related parties and $1,227,000 due to related parties.NOTE 6—SERVICING ASSETS:F-180Table of ContentsAt December 31, 2017 and 2016, servicing assets are measured at fair value. The Company earns servicing fees from the guaranteed portions of SBA 7(a)loans it originates and sells.The following table summarizes the fair value and valuation assumptions related to servicing assets at December 31, 2017 and 2016: December 31, 2017 December 31, 2016Fair Value$19,359 $16,246Discount factor (1)13.06% 12.20%Cumulative prepayment rate20.00% 18.50%Average cumulative default rate20.00% 20.00%(1) Determined based on risk spreads and observable secondary market transactions.Servicing fee income earned for the years ended December 31, 2017, 2016 and 2015 was $7,206,000, $6,160,000 and $4,611,000, respectively.NOTE 7—ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER LIABILITIES:The following table details the components of accounts payable, accrued expenses and other liabilities at December 31, 2017 and 2016: December 31, 2017 December 31, 2016Due to participants and SBA (1)$6,420 $5,512Accrued payroll and related expenses3,401 2,528Deferred rent and other lease related liabilities2,378 2,641Loan processing, servicing and other loan related expenses1,991 1,479Contingent consideration liabilities913 —Other1,763 1,744Total accounts payable, accrued expenses and other liabilities$16,866 $13,904(1) Represents loan related remittances received by NSBF, and due to third parties.NOTE 8—BORROWINGS:At December 31, 2017 and 2016, the Company had borrowings comprised of the following: December 31, 2017 December 31, 2016Facility Commitments BorrowingsOutstanding Weighted AverageInterest Rate Commitments BorrowingsOutstanding Weighted AverageInterest RateCapital One line of credit -guaranteed (1) $100,000 $— —% $50,000 $5,100 4.50%Capital One line of credit -unguaranteed (1) — — —% — — —%Notes due 2021 40,250 39,114 7.00% 40,250 38,767 7.00%Notes due 2022 8,324 7,936 7.50% 8,324 7,853 7.50%Notes payable - related parties 50,000 7,001 7.69% 38,000 1,400 7.67%Notes payable - Securitization Trusts 165,432 162,201 4.10% 120,945 118,122 3.79%Total $364,006 $216,252 4.87% $257,519 $171,242 4.75%F-181Table of Contents(1) Total combined commitments of the guaranteed and unguaranteed lines of credit are $100,000,000 and $50,000,000 at December 31, 2017 and 2016,respectively.Outstanding borrowings under the Notes due 2022, Notes due 2021 and Notes payable - Securitization Trusts consisted of the following: December 31, 2017 December 31, 2016 Notes Due2022 Notes Due2021 Notes Payable-Securitization Trusts Notes Due2022 Notes Due 2021 Notes Payable-SecuritizationTrustsPrincipal$8,324 $40,250 $165,432 $8,324 $40,250 $120,945Unamortized deferred financing costs(388) (1,136) (3,231) (471) (1,483) (2,823)Net carrying amount$7,936 $39,114 $162,201 $7,853 $38,767 $118,122As of December 31, 2017 and 2016, the carrying amount of the Company’s borrowings under the Capital One lines of credit, Notes payable - related partiesand Notes payable - Securitization Trusts, approximates their fair value due to their variable interest rates.The fair value of the fixed rate Notes due 2022 Notes and 2021 Notes is based on the closing public share price on the date of measurement. On December 31,2017, the closing price of the 2022 Notes was $26.51 per note, or $8,827,000. On December 31, 2016, the closing price of the 2022 Notes was $26.09 or$8,687,000. On December 31, 2017, the closing price of the 2021 Notes was $25.45 per note, or $40,975,000. On December 31, 2016, the closing price of the2021 Notes was $25.53 per note, or $41,103,000. These borrowings are not recorded at fair value on a recurring basis.Total interest expense related to borrowings for the years ended December 31, 2017, 2016 and 2015, was $11,377,000, $8,385,000 and $6,479,000,respectively.7.00% Notes Due 2021In April 2016, the Company and the Trustee, entered into the Second Supplemental Indenture to the Base Indenture between the Company and the Trustee,relating to the Company’s issuance, offer and sale of $35,000,000 aggregate principal amount of 7.0% Notes due 2021. The Company granted anoverallotment option of up to $5,250,000 in aggregate principal amount of the 2021 Notes. The sale of the Notes generated proceeds of approximately$33,750,000, net of underwriter’s fees and expenses. In May 2016, the underwriters exercised their option to purchase $5,250,000 in aggregate principalamount of notes for an additional $5,066,000 in net proceeds. The 2021 Notes are the Company’s direct unsecured obligations and rank: (i) pari passu withthe Company’s other outstanding and future unsecured indebtedness; (ii) senior to any of the Company’s future indebtedness that expressly provides it issubordinated to the 2021 Notes; (iii) effectively subordinated to all the Company’s existing and future secured indebtedness (including indebtedness that isinitially unsecured to which the Company subsequently grants security), to the extent of the value of the assets securing such indebtedness; and (iv)structurally subordinated to all existing and future indebtedness and other obligations of any of the Company’s subsidiaries.The 2021 Notes will mature on March 31, 2021 and may be redeemed in whole or in part at the Company’s option at any time or from time to time on or afterApril 22, 2017, at a redemption price of 100% of the outstanding principal amount thereof plus accrued and unpaid interest payments otherwise payable forthe then-current quarterly interest period accrued to but not including the date fixed for redemption. The 2021 Notes bear interest at a rate of 7.0% per yearpayable quarterly on March 31, June 30, September 30, and December 31 of each year, commencing on June 30, 2016, and trade on the Nasdaq GlobalMarket under the trading symbol “NEWTL.”The Base Indenture, as supplemented by the Second Supplemental Indenture, contains certain covenants including covenants requiring the Company tocomply with (regardless of whether it is subject to) the asset coverage requirements set forth in Section 18(a)(1)(A) of the 1940 Act as modified bySection 61(a)(1) of the 1940 Act, to comply with (regardless of whether it is subject to) the restrictions on dividends, distributions and purchase of capitalstock set forth in Section 18(a)(1)(B) of the 1940 Act as modified by Section 61(a)(1) of the 1940 Act as in effect immediately prior to the issuance of the2021 Notes, and to provide financial information to the holders of the 2021 Notes and the Trustee if the Company should no longer be subject to thereporting requirements under the Exchange Act. These covenants are subject to important limitations and exceptions that are described in the Base Indenture,as supplemented by the First Supplemental Indenture. The Base Indenture provides for customary events of default and further provides that the Trustee orthe holders of 25% in aggregate principal amount of theF-182Table of Contentsoutstanding 2021 Notes may declare such 2021 Notes immediately due and payable upon the occurrence of any event of default after expiration of anyapplicable grace period. At December 31, 2017, the Company was in compliance with all covenants related to the 2021 Notes. See Note 19 for furtherdiscussion of the 2021 Notes.At December 31, 2017 the 2021 Notes had an outstanding principal balance of $40,250,000. For the years ended December 31, 2017 and 2016 interestexpense including amortization of related deferred financing costs was $3,164,000 and $2,181,000, respectively.7.50% Notes Due 2022In September 2015, the Company and the Trustee entered into the Base Indenture and the First Supplemental Indenture relating to the Company’s issuance,offer, and sale of $8,324,000, including the underwriter’s partial exercise of their over-allotment option, in aggregate principal amount of the 7.5% Notes due2022. The 2022 Notes are the Company’s direct unsecured obligations and rank: (i) pari passu with the Company’s other outstanding and future unsecuredindebtedness; (ii) senior to any of the Company’s future indebtedness that expressly provides it is subordinated to the 2022 Notes; (iii) effectivelysubordinated to all the Company’s existing and future secured indebtedness (including indebtedness that is initially unsecured to which the Companysubsequently grants security), to the extent of the value of the assets securing such indebtedness; and (iv) structurally subordinated to all existing and futureindebtedness and other obligations of any of the Company’s subsidiaries. The 2022 Notes will mature on September 30, 2022 and may be redeemed in wholeor in part at the Company’s option at any time or from time to time on or after September 23, 2018, at a redemption price of 100% of the outstandingprincipal amount thereof plus accrued and unpaid interest payments otherwise payable for the then-current quarterly interest period accrued to but notincluding the date fixed for redemption. Proceeds net of offering costs and expenses were $7,747,000.The Base Indenture, as supplemented by the First Supplemental Indenture, contains certain covenants including covenants requiring the Company to complywith (regardless of whether it is subject to) the asset coverage requirements set forth in Section 18(a)(1)(A) of the 1940 Act as modified by Section 61(a)(1) ofthe 1940 Act, to comply with the restrictions on dividends, distributions and purchase of capital stock set forth in Section 18(a)(1)(B) of the 1940 Act asmodified by Section 61(a)(1) of the 1940 Act, and to provide financial information to the holders of the 2022 Notes and the Trustee if the Company shouldno longer be subject to the reporting requirements under the Exchange Act. These covenants are subject to important limitations and exceptions that aredescribed in the Base Indenture, as supplemented by the Second Supplemental Indenture. The Base Indenture provides for customary events of default andfurther provides that the Trustee or the holders of 25% in aggregate principal amount of the outstanding 2022 Notes may declare such 2022 Notesimmediately due and payable upon the occurrence of any event of default after expiration of any applicable grace period. At December 31, 2017, theCompany was in compliance with all covenants related to the 2022 Notes.At December 31, 2017 the 2022 Notes had an outstanding principal balance of $8,324,000. For the years ended December 31, 2017, 2016 and 2015, interestexpense including amortization of related deferred financing costs was $707,000,$708,000 and $192,000, respectively.Capital One FacilitiesIn May 2017, NSBF amended its Capital One facility to increase the facility from $50,000,000 to $100,000,000 and provided a reduction in interest rates.The interest rate on the portion of the facility, collateralized by the government guaranteed portion of SBA 7(a) loans, is set at Prime minus 0.25%(previously Prime plus 1.00%), and there is a quarterly facility fee equal to 0.25% on the unused portion of the revolving credit calculated as of the end ofeach calendar quarter. The interest rate on the portion of the facility, collateralized by the unguaranteed portion of SBA 7(a) loans, is set at Prime plus 0.75%(previously Prime plus 1.875%), and there is a quarterly facility fee equal to 0.25% on the unused portion of the revolving credit calculated as of the end ofeach calendar quarter. The facility provides for a 55% advance rate on the non-guaranteed portions of the SBA 7(a) loans NSBF originates, and a 90%advance rate on the guaranteed portions of SBA 7(a) loans NSBF originates. In addition, the amendment extended the date on which the facility will convertto a term loan from May 16, 2017 to May 11, 2020 and extended the maturity date of the facility to May 11, 2022. In June 2015, NSBF amended the existing facility to eliminate the fixed charge coverage ratio in exchange for a debt service ratio, new EBITDA minimums,the elimination of restrictions on the our ability to pay dividends to shareholders, as well as the release of the guarantees of our former subsidiaries (nowtreated as portfolio companies).At December 31, 2017, there were no borrowings outstanding under the unguaranteed and guaranteed lines of credit and NSBF was in full compliance withall applicable loan covenants.F-183Table of ContentsFor the years ended December 31, 2017, 2016 and 2015, interest expense including amortization of related deferred financing costs was $1,188,000,$1,260,000 and $1,165,000, respectively.Notes Payable - Securitization TrustsSince 2010, NSBF has engaged in securitizations of the unguaranteed portions of its SBA 7(a) loans. In the securitization, it uses a special purpose entity (the“Trust”) which is considered a variable interest entity. Applying the consolidation requirements for VIEs under the accounting rules in ASC Topic 860,Transfers and Servicing, and ASC Topic 810, Consolidation, which became effective January 1, 2010, the Company determined that as the primarybeneficiary of the securitization vehicle, based on its power to direct activities through its role as servicer for the Trust and its obligation to absorb losses andright to receive benefits, it needed to consolidate the Trusts. NSBF therefore consolidated the entity using the carrying amounts of the Trust’s assets andliabilities. NSBF reflects the assets in SBA Unguaranteed Non-Affiliate Investments and reflects the associated financing in Notes Payable - SecuritizationTrusts.In November 2016, NSBF completed its seventh securitization which resulted in the transfer of $56,073,000 of unguaranteed portions of SBA loans to the2016-1 Trust. The 2016-1 Trust in turn issued securitization notes for the par amount of $53,444,000, consisting of $43,632,000 Class A notes and$9,812,000 of Class B notes, against the assets in a private placement. The Class A and Class B notes received an “A” and “BBB+” rating by S&P,respectively, and the final maturity date of the notes is February 2042.In December 2017, NSBF completed its eighth securitization which resulted in the transfer of $76,188,000 of unguaranteed portions of SBA loans to the2017-1 Trust. The 2017-1 Trust in turn issued securitization notes for the par amount of $75,426,000, consisting of $58,111,000 Class A notes and$17,315,000 of Class B notes, against the assets in a private placement. The Class A and Class B notes received an “A” and “BBB-” rating by S&P,respectively, and the final maturity date of the notes is February 2043.For the years ended December 31, 2017, 2016 and 2015, interest expense including amortization of related deferred financing costs and discount was$5,537,000, $3,976,000 and $3,810,000, respectively.At December 31, 2017 and 2016, the assets of the consolidated Trusts totaled $274,321,000 and $205,060,000 respectively, the liabilities of theconsolidated Trusts totaled $165,432,000 and $120,945,000, respectively.Notes Payable - Related PartiesIn June 2015, the Company entered into the Related Party RLOC. Maximum borrowings under the Related Party RLOC were $38,000,000.In June 2017, the Related Party RLOC was amended to increase maximum borrowings to $50,000,000. The outstanding balance bears interest at a rate equalto (a) LIBOR (with a floor of 0.50%) plus (b) 6% or at a rate equal to (y) the greater of the Prime Rate or 3.5% plus (z) 5.0%. At December 31, 2017, theRelated Party RLOC interest rate was 7.69%. The Related Party RLOC has a maturity date of June 21, 2021. Outstanding borrowings at December 31, 2017were $7,001,000. For the years ended December 31, 2017, 2016 and 2015, interest expense was $780,000, $260,000 and $621,000, respectively.Total expected principal repayments on the Company’s borrowings for the next five fiscal years and thereafter are as follows:December 31,Borrowings2018$—2019—2020—202147,25120228,324Thereafter165,432 $221,007NOTE 9—COMMITMENTS AND CONTINGENCIES:F-184Table of ContentsOperating and Employment CommitmentsThe Company leases office space and other office equipment in several states under operating lease agreements which expire at various dates through 2029.Those office space leases which are for more than one year generally contain scheduled rent increases or escalation clauses.The following summarizes the Company’s obligations and commitments, as of December 31, 2017 for future minimum cash payments required underoperating lease and employment agreements:YearOperatingLeases EmploymentAgreements Total2018$2,005 $300 $2,30520191,691 — 1,69120201,455 — 1,45520211,352 — 1,35220221,360 — 1,360Thereafter6,217 — 6,217Total$14,080 $300 $14,380Minimum payments have not been reduced by minimum sublease rentals of $450,000 due in the future under non-cancellable subleases.Rent expense including loss on lease for the years ended December 31, 2017, 2016 and 2015 was $769,000, $1,765,000 and $866,000, respectively.Legal MattersIn the ordinary course of business, the Company and its wholly owned portfolio companies may from time to time be party to lawsuits and claims. TheCompany evaluates such matters on a case by case basis and its policy is to contest vigorously any claims it believes are without compelling merit. TheCompany is not currently involved in any litigation matters.On October 13, 2017, the Company announced that its portfolio company, BSP, was served with a search warrant by the Federal Bureau of Investigation onOctober 12, 2017 at BSP’s offices in Westfield, Indiana. The Company closed on its $5,400,000 investment in BSP in June 2016. While the outcome of thissituation cannot at this time be predicted with certainty, the Company does not expect that the matter will materially affect the Company’s financialcondition or results of operations.GuaranteesThe Company is a guarantor on the Sterling Receivable and Inventory Facility at NBCS. Maximum borrowings under the Sterling Receivable and InventoryFacility are $15,000,000. The Sterling Receivable and Inventory Facility matures in February 2019 and automatically renews annually. At December 31,2017, total principal owed by NBCS was $11,164,000. In addition, the Company deposited $750,000 to collateralize the guarantee. At December 31, 2017,the Company determined that it is not probable that payments would be required to be made under the guarantee.The Company is also a guarantor on the Sterling 504 Facility at NBCS. Maximum borrowings under the 504 Facility are $35,000,000, depending uponsyndication. The Sterling 504 Facility matures in August 2018. At December 31, 2017, total principal owed by NBCS was $8,597,000. At December 31,2017, the Company determined that it is not probable that payments would be required to be made under the guarantee.The Company is a guarantor on the Goldman Facility, a term loan facility between UPSW, NTS, Premier, BSP and SBL with Goldman Sachs with anaggregate principal amount up to $50,000,000. The Goldman Facility matures in June 2021. At December 31, 2017, total principal outstanding was$40,000,000. At December 31, 2017, the Company determined that it is not probable that payments would be required to be made under the guarantee.F-185Table of ContentsNOTE 10—EARNINGS PER SHARE:The following table summarizes the calculation for the net increase in net assets resulting from operations per common share for the years endedDecember 31, 2017, 2016 and 2015: December 31, 2017 December 31, 2016 December 31, 2015Net increase in net assets resulting from operations $38,976 $27,305 $35,736Weighted average shares outstanding 17,327 14,541 10,770Net increase in net assets resulting from operations per common share $2.25 $1.88 $3.32NOTE 11—COMMON STOCK:The following table summarizes the total shares issued and proceeds received net of underwriting discounts and offering costs in public offerings of theCompany’s common stock since conversion to a BDC: Year Ended December 31, 2017 December 31, 2016 December 31, 2015 December 31, 2014Shares issued 2,587,500 — 2,300,000 2,530,000Offering price per share $15.25 $— $16.50 $12.50Proceeds net of underwriting discounts and offering costs $37,042 $— $35,290 $27,883In January 2017 the Company priced a public offering of 2,250,000 shares of its common stock at a public offering price of $15.25 per share. The Companyalso sold an additional 337,500 shares of its common stock at a public offering price of $15.25 per share pursuant to the underwriter’s full exercise of theover-allotment option.In October 2015 the Company priced a public offering of 2,000,000 shares of its common stock at a public offering price of $16.50 per share. The Companyalso sold an additional 300,000 shares of its common stock at a public offering price of $16.50 per share pursuant to the underwriter’s full exercise of theover-allotment option.In November 2014 the Company priced a public offering of 2,200,000 shares of its common stock at a public offering price of $12.50 per share. TheCompany also sold an additional 330,000 shares of its common stock at a public offering price of $12.50 per share pursuant to the underwriter’s full exerciseof the over-allotment option.ATM ProgramOn March 20, 2017, the Company entered into an ATM Equity Distribution Agreement. The ATM Equity Distribution Agreement provides that theCompany may offer and sell up to 2,900,000 shares of common stock from time to time through the Placement Agents. On September 6, 2017, the Companyentered into an amended ATM Equity Distribution Agreement for the purpose of adding D.A. Davidson as placement agent. During the year endedDecember 31, 2017, the Company sold 1,139,000 shares of its common stock at a weighted average price of $17.58 per share. Proceeds, net of offering costsand expenses were $19,620,000. As of December 31, 2017, there were 1,761,000 shares of common stock available for sale under the ATM EquityDistribution Agreement.The Company used the net proceeds for funding investments in debt and equity securities in accordance with its investment objective and strategies.Investment in IPMDuring the year ended December 31, 2017, in connection with its investment in IPM, the Company issued 60,490 restricted common shares valued at$1,000,000.F-186Table of ContentsInvestment in UCSDuring the year ended December 31, 2017, in connection with its investment in UCS, the Company issued 28,741 restricted common shares valued at$500,000.Share Repurchase PlanOn November 21, 2016 the Company announced that its Board approved a new share repurchase program under which the Company may repurchase up to200,000 of the Company’s outstanding common shares on the open market. This program terminated on May 21, 2017.On May 11, 2016, the Company announced that its Board approved a share repurchase program under which the Company could repurchase up to 150,000 ofthe Company’s outstanding common shares on the open market. This program terminated on November 11, 2016.During the year ended December 31, 2016, the Company repurchased and retired 70,000 common shares in open market transactions for $866,000 as detailedin the table below. This program terminated on June 3, 2016.Purchase date Number of SharesPurchased Price per Share TotalMarch 10, 2016 10 $12.34 $123March 18, 2016 20 $12.45 249March 18, 2016 30 $12.48 375March 23, 2016 10 $11.88 119Total 70 $866NOTE 12—DIVIDENDS AND DISTRIBUTIONS:The Company’s dividends and distributions are recorded on the declaration date. The following table summarizes the Company’s dividend declarations anddistributions during the years ended December 31, 2017 and 2016.Date Declared Record Date Payment Date Amount PerShare Cash Distribution DRIP SharesIssued DRIP SharesValueDecember 31, 2017 March 6, 2017 March 20, 2017 March 31, 2017 $0.36 $6,062 6 $89May 4, 2016 May 31, 2017 June 30, 2017 $0.40 $6,804 7 $112August 21, 2017 September 22, 2017 September 29, 2017 $0.44 $7,585 11 $184November 9, 2017 December 18, 2017 December 28, 2017 $0.44 $7,838 14 $260 December 31, 2016 February 25, 2016 March 22, 2016 March 31, 2016 $0.35 $4,708 29 $362June 9, 2016 June 20, 2016 June 30, 2016 $0.35 $4,985 7 $83September 7, 2016 September 20, 2016 September 30, 2016 $0.43 $6,152 6 $77November 17, 2016 December 15, 2016 December 30, 2016 $0.40 $5,706 6 $91 During the year ended December 31, 2017, an additional 7,200 shares valued at $122,000 were issued related to dividends from unvested restricted stockawards.NOTE 13—BENEFIT PLANS:F-187Table of ContentsDefined Contribution PlanThe Company’s employees participate in a defined contribution 401(k) plan (the “Plan”) adopted in 2004 which covers substantially all employees based oneligibility. The Plan is designed to encourage savings on the part of eligible employees and qualifies under Section 401(k) of the Code. Under the Plan,eligible employees may elect to have a portion of their pay, including overtime and bonuses, reduced each pay period, as pre-tax contributions up to themaximum allowed by law. The Company may elect to make a matching contribution equal to a specified percentage of the participant’s contribution, ontheir behalf as a pre-tax contribution. For the years ended December 31, 2017, 2016 and 2015, the Company matched 50% of the first 2% of employeecontributions, resulting in $197,000, $63,000 and $177,000 in expense, respectively.NOTE 14—INCOME TAXES:As a RIC, the Company must distribute substantially all of its respective net taxable income each tax year as dividends to its shareholders. Accordingly, noprovision for federal income tax has been made in the financial statements for the years ended December 31, 2017, 2016 and 2015.Dividends from net investment income and distributions from net realized capital gains are determined in accordance with U.S. federal tax regulations, whichmay differ from amounts determined in accordance with GAAP and those differences could be material. These book-to-tax differences are either temporary orpermanent in nature. Reclassifications due to permanent book-tax differences, including the offset of net operating losses against net short-term gains andnondeductible meals and entertainment, have no impact on net assets.The following differences were reclassified for tax purposes for the years ended December 31, 2017, 2016 and 2015: December 31, 2017 December 31, 2016 December 31, 2015(Decrease) increase in additional paid-in capital$(342) $(649) $195Increase in undistributed net investment income14,581 12,915 10,622Decrease in net realized gains on investments(14,239) (12,266) (10,817)Taxable income generally differs from net increase (decrease) in net assets for financial reporting purposes due to temporary and permanent differences in therecognition of income and expenses and generally excludes unrealized appreciation (depreciation) on investments as investment gains and losses are notincluded in taxable income until they are realized.The following table reconciles net increase in net assets to taxable income for the years ended December 31, 2017, 2016 and 2015: December 31, 2017 December 31, 2016 December 31, 2015Net increase in net assets$38,976 $27,305 $35,736Net change in unrealized depreciation on investments(9,619) (12,343) (10,187)Net change in deferred tax liabilities2,179 5,128 857GAAP versus tax basis consolidation of subsidiaries1,210 1,536 (4,115)Other income (deductions/losses) for tax, not book181 (17) (307)Other differences(2,593) 1,871 92Taxable income before deductions for distributions$30,334 $23,480 $22,076The tax character of distributions paid during the years ended December 31, 2017, 2016 and 2015 were as follows: December 31, 2017 December 31, 2016 December 31, 2015Ordinary income$24,866 $18,774 $15,043Long-term capital gains4,068 3,390 67Return of capital— — —F-188Table of ContentsThe determination of the tax attributes of the Company’s distributions is made annually as of the end of the Company’s fiscal year based upon theCompany’s taxable income for the full year and distributions paid for the full year. Approximately 19% of the Company’s ordinary income was fromqualified dividends. The actual tax characteristics of distributions to shareholders are reported to shareholders annually on Form 1099-DIV.The tax basis components of distributable earnings/(accumulated losses) and reconciliation to accumulated earnings/(deficit) on a book basis for the yearsended December 31, 2017, 2016 and 2015 were as follows: December 31, 2017 December 31, 2016 December 31, 2015Undistributed ordinary income - tax basis$3,782 $2,377 $6,781Undistributed net realized gains - tax basis— — 184Net change in unrealized appreciation on investments20,466 13,025 8,062GAAP versus tax basis consolidation of subsidiaries1,369 2,579 4,115Other temporary differences4,982 2,348 1,288Dividends payable— — (5,802)Total accumulated earnings - book basis$30,599 $20,329 $14,628The differences between the components of distributable earnings on a tax basis and the amounts reflected in the consolidated statements of changes in netassets are primarily due to temporary book-tax differences that will reverse in a subsequent period.NOTE 15—FINANCIAL HIGHLIGHTS:The financial highlights for the Company are as follows:F-189Table of ContentsPer share data (1) December 31, 2017 December 31, 2016 December 31, 2015Net asset value at beginning of period $14.30 $14.06 $16.31Net investment loss (0.45) (0.64) (0.57)Net realized gain on investments 2.27 2.17 3.14Net unrealized appreciation on investments 0.75 0.85 0.94Net unrealized depreciation on servicing assets (0.20) (0.16) (0.13)Change in provision for deferred taxes (0.12) (0.34) (0.06)Net increase in net assets resulting from operations 2.25 1.88 3.32Dividends to common stockholders from net investment income (1.41) (1.30) —Distributions to common stockholders from capital gains (0.23) (0.23) (1.76)Special dividend — — (2.69)Total dividends paid (1.64) (1.53) (4.45)Stock-based compensation expense 0.05 0.04 —Consolidation of Exponential Business Development Co., Inc. — (0.03) —Reversal of deferred tax asset — — (0.19)Out of period adjusted related to BDC Conversion — — (0.06)Exponential of New York LLC distributions to members — — (0.25)Accretive effect of stock offerings (issuing shares above NAV per share) 0.02 — 2.43Accretive effect of shares issued in connection with investments (issuing shares above NAVper share) 0.01 — —Dilutive effect of special dividend — — (3.07)Dilutive effect of restricted stock awards — (0.11) —Other (4) 0.09 (0.01) 0.02Net asset value at end of period $15.08 $14.30 $14.06 Per share market value at end of period $18.49 $15.90 $14.32Total return based on market value (2) 26.60 % 24.51 % 24.46 %Total return based on average net asset value (2)(3) 16.92 % 12.59 % 13.52 %Shares outstanding at end of period (in thousands) 18,457 14,624 14,509 Ratios/Supplemental Data: Net assets at end of period $278,329 $209,094 $203,949Ratio of expenses to average net assets 19.20 % 19.48 % 17.42 %Ratio of net investment loss to average net assets (3.23)% (4.48)% (3.34)%Portfolio turnover 116.38 % 109.6 % 103.5 %Average debt outstanding $193,747 $151,502 $128,680Average debt outstanding per share $10.50 $10.36 $8.87Asset coverage ratio 229 % 222 % 249 %(1) Based on actual number of shares outstanding at the end of the corresponding period or the weighted average shares outstanding for the period, unlessotherwise noted, as appropriate.(2) Assumes dividends are reinvested.(3) Total return based on average net asset value was calculated using the sum of ending net asset value plus dividends to stockholders during the period,divided by the beginning net asset value.F-190Table of Contents(4) Includes the impact of the different share amounts as a result of calculating certain per share data based on weighted average shares outstanding during theperiod and certain per share data based on shares outstanding as of a period end or transaction date.NOTE 16—STOCK-BASED COMPENSATION:Stock PlanThe Company accounts for its stock-based compensation plan using the fair value method, as prescribed by ASC 718, Compensation—Stock Compensation.Accordingly, for restricted stock awards, the Company measured the grant date fair value based upon the market price of its common stock on the date of thegrant and amortizes the fair value of the awards as stock-based compensation expense over the requisite service period, which is generally the vesting term. The Board approves the issuance of shares of restricted stock to employees and directors pursuant to the Equity Incentive Plan. These shares generally vestover a one or two year period from the grant date. The fair value is expensed over the service period, starting on the grant date. The following tablesummarizes the restricted stock issuances under the Equity Incentive Plan, net of shares forfeited and the remaining shares of restricted stock available forissuance as of December 31, 2017.Restricted Stock authorized under the plan (1) 1,500,000Less net restricted stock granted during: Year ended December 31, 2016 (120,933)Year ended December 31, 2017 (5,007)Restricted stock available for issuance as of December 31, 2017 1,374,060(1) A maximum of 20% of total shares of common stock issued and outstanding, calculated on a fully diluted basis, not to exceed 3,000,000 shares, areavailable for awards of restricted stock and stock options under the Equity Incentive Plan. No more than 50% of the shares of stock reserved for the grant ofawards under the Equity Incentive Plan may be restricted stock awards at any time during the term of the Equity Incentive Plan. No stock options have beengranted under the Equity Incentive Plan.For the years ended December 31, 2017 and 2016, the Company recognized total stock-based compensation expense of $963,000 and $577,000,respectively. No stock-based compensation expense was recognized during the year ended December 31, 2015.As of December 31, 2017, there was $217,000 of total unrecognized compensation expense related to unvested restricted shares. This compensation expenseis expected to be recognized over a remaining weighted-average period of approximately 1.39 years as of December 31, 2017.NOTE 17—UNCONSOLIDATED SIGNIFICANT SUBSIDIARIES:In accordance with the SEC’s Regulation S-X and GAAP, we are not permitted to consolidate any subsidiary or other entity that is not an investmentcompany, including those in which we have a controlling interest. We had one unconsolidated subsidiary that met at least one of the significance conditionsunder Rule 1-02(w) of Regulation S-X during the periods presented for which we are required, pursuant to Rule 3-09 of Regulation S-X, to attach separatefinancial statements as exhibits to the Form 10-K. Accordingly, the audited financial statements of UPSW for the years ended December 31, 2016 and 2015and unaudited financial statements for the year ended December 31, 2017 have been attached as exhibits.NOTE 18—SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED):The following tables set forth certain unaudited consolidated quarterly statement of operations data from the eight quarters ended December 31, 2017. Thisinformation is unaudited, but in the opinion of management, it has been prepared substantially on the same basis as the audited consolidated financialstatements appearing elsewhere in this report, and all necessary adjustments, consisting only of normal recurring adjustments, have been included in theamounts stated below. TheF-191Table of Contentsconsolidated quarterly data should be read in conjunction with the current audited consolidated statements and notes thereto. The total of the quarterly EPSdata may not equal to the full year results. Three Months Ended2017March 31 June 30 September 30 December 31Total investment income$8,993 $9,904 $9,601 $10,416Net investment loss$(2,094) $(1,680) $(1,192) $(2,915)Net gain on investments$7,998 $8,610 $9,269 $20,980Net increase in net assets resulting from operations$5,904 $6,930 $8,077 $18,065Net increase in net assets resulting from operations per share$0.36 $0.40 $0.46 $1.00Net asset value per share at period end$14.31 $14.36 $14.40 $15.08 Three Months Ended2016March 31 June 30 September 30 December 31Total investment income$6,794 $7,223 $7,851 $9,097Net investment loss$(1,380) $(4,081) $(2,125) $(1,674)Net gain on investments$6,984 $9,453 $12,165 $7,963Net increase in net assets resulting from operations$5,604 $5,372 $10,040 $6,289Net increase in net assets resulting from operations per share$0.39 $0.37 $0.69 $0.43Net asset value per share at period end$14.10 $14.11 $14.26 $14.30NOTE 19—SUBSEQUENT EVENTS:On February 21, 2018, the Company closed a public offering of $50,000,000 in aggregate principal amount of its 2023 Notes. The 2023 Notes will mature onMarch 1, 2023 and may be redeemed in whole or in part at any time or from time to time at Newtek’s option on or after March 1, 2020. The 2023 Notes bearinterest at a rate of 6.25% per year payable quarterly on March 1, June 1, September 1 and December 1, of each year, beginning June 1, 2018. Total netproceeds received after deducting underwriters’ discount and expenses was $48,288,000. The 2023 Notes are listed on the Nasdaq Global Market under thetrading symbol “NEWTI” and were rated “A-“ by Egan-Jones. A portion of the proceeds will be used to redeem the outstanding 2021 Notes pending theconclusion of a 30-day notice period to existing holders of the 2021 Notes, expiring on March 23, 2018. In February 2018, the underwriters exercised theiroption to purchase an additional $7,500,000 in aggregate principal amount of the 2023 Notes resulting in an additional $7,275,000 in net proceeds.On February 21, 2018, the Company issued redemption notices to the holders of the 2021 Notes. The Company will redeem all $40,250,000 in aggregateprincipal amount of the Notes on the Redemption Date at 100% of their principal amount ($25 per Note), plus the accrued and unpaid interest thereon fromDecember 31, 2017, through, but excluding, the Redemption Date.On January 18, 2018, the Company declared a quarterly cash dividend of $0.40 per share payable on March 30, 2018 to shareholders of record as of March20, 2018. The dividend will be paid in cash or shares of the Company's common stock through participation in the Company's DRIP, at the election ofshareholders.F-192Table of ContentsNewtek Business Services Corp. and SubsidiariesSchedule of Investments In and Advances to AffiliatesDecember 31, 2017Portfolio Company Type ofInvestment (1) Amount ofRealizedGain (Loss) Amount ofUnrealizedAppreciation(Depreciation) Amount ofInterest orDividendsCredited toIncome (3) Fair Value atDecember 31,2016 GrossAdditions (4) GrossReductions (5) Fair Value atDecember 31,2017Advanced CyberSecurity Systems, LLC 50%MembershipInterest (2) $— $— $— $— $— $— $— Term Loan(3%) (2) — — — — — — — Automated MerchantServices, Inc. 100% CommonStock (2) — — — — — — — CDS Business Services,Inc. 100% CommonStock — 7,250 200 750 7,250 — 8,000 Line of Credit(Prime + 2.5%)(6) — — 544 2,690 18,343 (14,637) 6,396 Newtek TechnologySolutions, Inc. 100% CommonStock (2) — (7,659) — 20,109 — (7,709) 12,400 Fortress DataManagement, LLC 100%MembershipInterest (2) — — — — — — — Newtek InsuranceAgency, LLC 100%MembershipInterest (2) — — — 2,500 — — 2,500 PMTWorks Payroll,LLC 100%MembershipInterest (2) — (860) — 860 — (860) — Term Loan(10%-12%) (2) — (2,185) — 1,185 1,000 (2,185) — Secure CyberGatewayServices, LLC 66.7%MembershipInterest — — 47 — — — — Term Loan(7%) (300) 300 19 — — — — Small Business Lending,LLC 100%MembershipInterest 100 (800) — 3,300 — (800) 2,500 Summit Systems andDesigns, LLC 100%MembershipInterest — — 54 — — — — banc-serv Partners,LLC 100%MembershipInterest (2) — (2,000) — 5,400 30 (2,000) 3,430 Premier Payments LLC 100%MembershipInterest — 2,000 1,575 21,000 2,000 — 23,000F-193Table of ContentsPortfolio Company Type ofInvestment (1) Amount ofRealizedGain (Loss) Amount ofUnrealizedAppreciation(Depreciation) Amount ofInterest orDividendsCredited toIncome (3) Fair Value atDecember 31,2016 GrossAdditions (4) GrossReductions (5) Fair Value atDecember 31,2017 International ProfessionalMarketing, Inc. (8) 100% CommonStock — — 550 — 4,000 — 4,000 Line of Credit(Prime + 0.5%)(6) — — 10 — 1,450 (1,000) 450 SIDCO, LLC (8) 100%MembershipInterest — — 225 — 7,120 — 7,120 Line of Credit(Prime + 0.5%)(6) — — 6 — 795 (245) 550 Universal ProcessingServices of Wisconsin, LLC 100%MembershipInterest — 17,000 7,100 63,000 17,000 — 80,000 United Capital Source, LLC 100%MembershipInterest — — 50 — 2,450 — 2,450 Titanium AssetManagement, LLC 100%MembershipInterest (2) — — — — — — — Term Loan (2) — (42) 6 508 — (508) — Excel WebSolutions LLC (7) 100%MembershipInterest (2) — — — — — — — Term Loan — (47) 68 904 — (544) 360 Total ControlledInvestments $(200) $12,957 $10,454 $122,206 $61,438 $(30,488) $153,156This schedule should be read in connection with the Company’s Consolidated Financial Statements, including the Consolidated Schedule of Investmentsand Notes to the Consolidated Financial Statements.(1) The principal amount and ownership detail as shown in the Company’s Consolidated Schedule of Investments.(2) Represents non-income producing security.(3) Represents the total amount of interest, fees or dividends credited to income for the period.(4) Gross additions includes increases in the cost basis of investments resulting from new portfolio investments, follow-on investments and the exchange ofone or more existing securities for one or more new securities. Gross additions also includes net increases in unrealized appreciation or net decreases inunrealized depreciation.(5) Gross reductions include decreases in the cost basis of investments resulting from principal payments or sales and exchanges of one or more existingsecurities for one or more new securities. Gross reductions also include net increases in unrealized depreciation or net decreases in unrealized appreciation.(6) Index based floating rate debt investments bear interest at rate of Prime plus a contractual spread which typically resets monthly. At December 31, 2017,the Prime rate was 4.25%.(7) Prior to January 2017, EWS was a non-control/non-affiliate investment. Refer to Note 5.(8) During the year ended December 31, 2017, a portion of IPM’s business was spun off into a new wholly-owned controlled portfolio company, SIDCO. As aresult, the underlying IPM business has not changed. The Company determined the cost basis of its investments in IPM and SIDCO to be $4,000,000 and$7,120,000, respectively. Refer to Note 4.F-194NEWTEK BUSINESS SERVICES CORP. SUBSIDIARIES Name of Company State of Incorporation/Organization CCC Real Estate Holdings, LLC DelawareExponential Business Development Co., Inc. New YorkNewtek Small Business Finance, LLC New YorkNewtek Asset Backed Securities, LLC DelawareNewtek Business Services Holdco 1, Inc. New YorkNewtek Business Services Holdco 2, Inc. New YorkNewtek Business Services Holdco 3, Inc. New YorkNewtek Business Services Holdco 4, Inc. New YorkNewtek Business Services Holdco 5, Inc. (formerly Banc-Serv Acquisition Inc.) New YorkThe Whitestone Group, LLC New YorkWilshire Colorado Partners, LLC ColoradoWilshire DC Partners, LLC District of ColumbiaWilshire Holdings I, Inc. New YorkWilshire Louisiana BIDCO, LLC LouisianaWilshire Louisiana Partners II, LLC LouisianaWilshire Louisiana Partners III, LLC LouisianaWilshire Louisiana Partners IV, LLC LouisianaWilshire New York Advisers II, LLC New YorkWilshire New York Partners III, LLC New YorkWilshire New York Partners IV, LLC New YorkWilshire New York Partners V, LLC New YorkWilshire Partners, LLC FloridaNewtek LSP Holdco, LLC New York Exhibit 31.1CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TO SECTION 302 OF THESARBANES-OXLEY ACT OF 2002I, Barry Sloane, certify that:1. I have reviewed this annual report on Form 10-K of Newtek Business Services Corp. (the “registrant”).2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to makethe statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annualreport;3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all materialrespects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for theregistrant and have:a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared;b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles;c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; andd) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recentfiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, theregistrant’s internal control over financial reporting.5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant’s ability to record, process, summarize and report financial information; andb) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controlover financial reporting. /S/ BARRY SLOANE Barry Sloane Principal Executive OfficerDate: March 16, 2018Exhibit 31.2CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TO SECTION 302 OF THESARBANES-OXLEY ACT OF 2002I, Jennifer Eddelson, certify that:1. I have reviewed this annual report on Form 10-K of Newtek Business Services Corp. (the “registrant”).2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to makethe statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annualreport;3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all materialrespects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for theregistrant and have:a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared;b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles;c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; andd) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recentfiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, theregistrant’s internal control over financial reporting.5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant’s ability to record, process, summarize and report financial information; andb) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controlover financial reporting. /S/ JENNIFER EDDELSON Jennifer Eddelson Principal Financial OfficerDate: March 16, 2018Exhibit 32.1CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002In connection with the Annual Report on Form 10-K of Newtek Business Services Corp. (the “Company”), for the year ended December 31, 2017, asfiled with the Securities and Exchange Commission on the date hereof (the “Report”), I, Barry Sloane, Chief Executive Officer of the Company, pursuant to18 U.S.C. Section 1350, as added by Section 906 of the Sarbanes-Oxley Act of 2002, certify that, to the best of our knowledge:(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the Company. /S/ BARRY SLOANE Barry Sloane Principal Executive OfficerMarch 16, 2018Exhibit 32.2CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002In connection with the Annual Report on Form 10-K of Newtek Business Services Corp. (the “Company”), for the year ended December 31, 2017, asfiled with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jennifer Eddelson, Chief Accounting Officer of the Company,pursuant to 18 U.S.C. Section 1350, as added by Section 906 of the Sarbanes-Oxley Act of 2002, certify that, to the best of our knowledge:(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the Company. /S/ JENNIFER EDDELSON Jennifer Eddelson Principal Financial OfficerMarch 16, 2018Universal Processing Services of ​ Wisconsin, LLC (A Limited Liability ​ Company) and Subsidiary ​ ​ Financial Statements ​ Year Ended December 31, 2017 ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Index ​ Year Ended December 31, 2017 ​ ​ Pages ​ Financial Statements ​ Balance Sheet ................................................................................................................................................ 1 ​ Statement of Income ..................................................................................................................................... 2 ​ Statement of Changes in Member’s Deficit .................................................................................................. 3 ​ Statement of Cash Flows .............................................................................................................................. 4 ​ Notes to Financial Statements .................................................................................................................. 5-12 ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Balance Sheet ​ December 31, 2017 ​ ​ See notes to financial statements. ​ ​ 1 ​ ​ Assets​ Current Assets:​ Cash 14,066,253$ ​ Accounts receivable 2,695,154 ​ Prepaid expenses and other current assets 172,236 ​ Inventory 71,780 ​ Total current assets 17,005,423 ​ Fixed assets, net 425,621 ​ Customer merchant accounts, net 760,011 ​ Restricted cash 498,220 ​ Due from related parties 103,460 ​ Notes receivable - related party 6,110,001 ​ Goodwill 1,908,495 ​ Total assets 26,811,231$ ​ Liabilities and Member's Deficit​ Liabilities:​ Current Liabilities:​ Accounts payable and accrued expenses 1,834,704$ ​ Residuals payable 903,690 ​ Due to related parties 585,939 ​ Chargeback reserves 782,908 ​ Total current liabilities 4,107,241 ​ Bank note payable, net of deferred financing costs 29,856,879 ​ Total liabilities 33,964,120 ​ Commitments and contingencies (Note 9)​ Member's deficit (7,152,889) ​ Total liabilities and member's deficit 26,811,231$ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Statement of Income ​ Year Ended December 31, 2017 ​ ​ See notes to financial statements. ​ ​ 2 ​ ​ ​ Revenue:​ Electronic payment processing 111,271,839$ ​ Expenses:​ Electronic payment processing costs 91,087,057 ​ Electronic payment processing costs - related parties 4,374,094 ​ Salaries and benefits 4,964,662 ​ Professional fees 441,012 ​ Depreciation and amortization 707,883 ​ Other general and administrative costs 1,099,876 ​ Total expenses 102,674,584 ​ Income from operations 8,597,255 ​ Interest expense (2,065,729) ​ Interest income - related party 588,922 ​ Interest expense, net (1,476,807) ​ Net income 7,120,448$ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Statement of Changes in Member’s Deficit ​ Year Ended December 31, 2017 ​ ​ See notes to financial statements. ​ ​ 3 ​ ​ Member's Deficit​ Balance, January 1, 2017 (5,621,394)$ ​ Net income 7,120,448 ​ Distributions to member (8,651,943) ​ Balance, December 31, 2017 (7,152,889)$ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Statement of Cash Flows ​ Year Ended December 31, 2017 ​ See notes to financial statements. ​ 4 ​ ​ ​ Cash flows from operating activities:​ Net income 7,120,448$ ​ Adjustments to reconcile net income to net cash provided by operating activities:​ Depreciation and amortization 707,883 ​ Amortization of deferred financing costs 193,743 ​ Changes in operating assets and liabilities:​ Restricted cash 89,487 ​ Accounts receivable 419,900 ​ Prepaid expenses and other current assets 90,830 ​ Inventory 173,720 ​ Accounts payable, accrued expenses and other current liabilities (1,633,711) ​ Due to/from related parties 335,537 ​ Net cash provided by operating activities 7,497,837 ​ Cash flows used in investing activities:​ Purchase of customer merchant accounts (62,029) ​ Net advances under notes receivable - related party (5,610,001) ​ Purchase of fixed assets (237,846) ​ Net cash used in investing activities (5,909,876) ​ Cash flows from financing activities:​ Distributions to member (8,651,943) ​ Proceeds from bank note payable 13,500,000 ​ Deferred financing costs paid (268,393) ​ Net cash provided by financing activities 4,579,664 ​ Net increase in cash 6,167,625 ​ Cash, beginning of year 7,898,628 ​ Ca h, end of year 14,066,253$ ​ Supplemental disclosure of cash flowinformation​ Interest paid 1,701,199$ ​ ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Financial Statements ​ Year Ended December 31, 2017 ​ ​ ​ 5 ​ ​ 1. Organization, Description of Business, and Basis of Presentation ​ Universal Processing Services of Wisconsin, LLC (“UPS-WI”), was organized as a limited liability ​ company (“LLC”) under the laws of the State of Wisconsin and is a wholly-owned subsidiary of ​ Newtek Business Services Holdco 1, Inc. (“Holdco”). As UPS-WI is a limited liability company, ​ the liability of Holdco is limited to its capital account. ​ UPS-WI and its wholly-owned subsidiary, UPSWI Sales, LLC (“UPS Sales”) are collectively ​ hereinafter referred to as the “Company”. The Company markets credit and debit card processing ​ services, check approval services and ancillary processing equipment and software to merchants ​ who accept credit cards, debit cards, checks and other non-cash forms of payment. ​ ​ 2. Significant Accounting Policies ​ Use of Estimates ​ The preparation of the financial statements in conformity with accounting principles generally ​ accepted in the United States of America requires management to make estimates and assumptions ​ that affect the reported amounts of assets and liabilities and disclosures of contingent assets and ​ liabilities at the date of the financial statements and the reported amounts of revenues and expenses ​ during thereporting period. Estimates, by their nature, are based on judgment and available ​ information. Actual results could differ from those estimates. Material estimates that are ​ particularly susceptible to significant changes in the near term relate to the determination of the ​ reserve for chargeback losses. ​ ​ Financial Instruments ​ The Company’s financial instruments include cash, accounts receivable, accounts payable and ​ accrued expenses, residuals payable, notes receivable from a related party and a bank note payable. ​ The carrying amounts of cash, accounts receivable, accounts payable and accrued expenses and ​ residuals payable approximate fair value due to their short term maturities. ​ The carrying amounts of notes receivable from a related party and bank note payable approximate ​ fair value due to the variable interest rate they carry. ​ ​ Cash ​ The Company maintains cash balances at financial institutions of high credit quality. As of ​ December 31, 2017, cash deposits in excess of insured amounts totaled approximately ​ $13,555,000. ​ ​ Restricted Cash ​ Under the terms of the processing agreement between UPS-WI and its processing banks, UPS-WI ​ maintains cash accounts as reserves against chargeback losses. As the Company receives fees from ​ the processing bank, a certain percentage is allocated to the cashreserve account for certain ​ merchants. ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Financial Statements ​ Year Ended December 31, 2017 ​ ​ ​ 6 ​ ​ Inventory ​ Inventory consists primarily of equipment to be installed in merchant locations to enable them to ​ process electronic transactions. Inventory is stated at the lower of cost or market, which is ​ determined on a FIFO (first in-first out) basis. ​ ​ Fixed Assets ​ Fixed assets, which are comprised of telephone systems, software, website, computer equipment, ​ credit card terminals, trucks and leasehold improvements, are stated at cost less accumulated ​ depreciation and amortization. Depreciation of fixed assets is provided on a straight-line basis ​ using estimated useful lives of the related assets. Amortization of leasehold improvements is ​ provided on a straight-line basis using the lesser of the useful life of the asset, which generally is ​ three to five years, or lease term. ​ ​ Goodwill and Customer Merchant Accounts ​ Goodwill is not amortized but is instead subject to impairment testing, at least annually. Customer ​ merchant accounts with finite lives are amortized over 66 months as discussed in Note 5. ​ The Company considers the following to be some examples of indicators that may trigger an ​ impairment review: (i) significant under-performance or loss of key contracts acquired in an ​ acquisition relative to expected historical or projected futureoperating results; (ii) significant ​ changes in the manner or use of the acquired assets or in the Company’s overall strategy with ​ respect to the manner or use of the acquired assets or changes in the Company’s overall business ​ strategy; (iii) significant negative industry or economic trends; (iv) increased competitive ​ pressures; (v) a significant decline in the Company’s fair market value for a sustained period of ​ time; and (vi) regulatory changes. In assessing the recoverability of the Company’s goodwill and ​ customer merchant accounts, the Company must make assumptions regarding estimated future cash ​ flows and other factors to determine the fair value of the respective assets. These include ​ estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-​ term rate of growth for the Company, the period over which cash flows will occur, and ​ determination of the Company’s cost of capital. Changes in these estimates and assumptions could ​ materially affect the determination of fair value and conclusion on impairment. ​ ​ Revenue Recognition ​ Electronic Payment Processing ​ Electronic payment processing and fee income is derived from the electronic processing of credit ​ and debit card transactions that are authorized and captured through third-party networks. ​ Typically, merchants are charged for these processing servicesas a percentage of each transaction ​ dollar plus a flat fee per transaction. Certain merchant customers are charged miscellaneous fees, ​ including fees for handling charge-backs or returns, monthly minimum fees, statement fees and ​ fees for other miscellaneous services. Revenues derived from the electronic processing of ​ MasterCard®, Visa® and Discover® sourced credit and debit card transactions are reported gross of ​ amounts paid to sponsor banks. ​ Interest Income ​ Interest income is recorded on an accrual basis, when earned, based on the current lending rate in ​ place. ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Financial Statements ​ Year Ended December 31, 2017 ​ ​ ​ 7 ​ ​ Reserve for Losses on Merchant Accounts ​ Disputes between a cardholder and a merchant periodically arise as a result of, among other things, ​ cardholder dissatisfaction with merchandise quality or merchant services. Such disputes may not be ​ resolved in the merchant’s favor. In these cases, the transaction is “charged back” to the merchant, ​ which means the purchase price is refunded to the customer through the merchant’s acquiring bank ​ and charged to the merchant. If the merchant has inadequate funds, the Company or, under limited ​ circumstances, the Company and the acquiring bank, must bear the credit risk for the full amount ​ of the transaction. The Company evaluates its risk for such transactions and estimates its potential ​ loss for charge-backs based primarily on historical experience and other relevant factors. ​ The Company records reserves for charge-backs and contingent liabilities when such amounts are ​ deemed to be probable and estimable. The required reserves may change in the future due to new ​ developments, including, but not limited to, changes in litigation or increased charge-back ​ exposure as the result of merchant insolvency, liquidation, or other reasons. Therequired reserves ​ are reviewed periodically to determine if adjustments are required. ​ ​ Electronic Payment Processing Costs ​ Electronic payment processing costs consist principally of costs directly related to the processing of ​ merchant sales volume, including interchange fees, Visa®, MasterCard® and Discover® dues and ​ assessments, bank processing fees and costs paid to third-party processing networks. Such costs ​ are recognized at the time the merchant transactions are processed or when the services are ​ performed. Two of the most significant components of electronic processing expenses include ​ interchange and assessment costs, which are set by the credit card associations. Interchange costs ​ are passed on to the entity issuing the credit card used in the transaction and assessment costs are ​ retained by the credit card associations. Interchange and assessment fees are billed primarily as a ​ percentage of dollar volume processed and, to a lesser extent, as a per transaction fee. In addition ​ to costs directly related to the processing of merchant sales volume, electronic payment processing ​ costs also include residual expenses. Residual expenses represent fees paid to third-party sales ​ referral sources. Residual expenses are paid in accordance with contracted terms. These are ​ generally linkedto revenues derived from merchants successfully referred to the Company and that ​ begin using the Company for merchant processing services. Such residual expenses are ​ recognized in the Company’s statement of income. During the year ended December 31, 2017, the ​ Company partnered with two sponsor banks for substantially all merchant transactions. ​ Substantially all merchant transactions were processed by one merchant processor. ​ ​ Income Taxes ​ The Company is a limited liability company (“LLC”) and therefore pays no corporate taxes. The ​ Company’s income, instead, passes through to its member. Accordingly, no liability for Federal, ​ State and/or local income taxes has been recorded in the accompanying financial statements. As a ​ wholly-owned subsidiary of Holdco, the Company evaluated its tax positions at year end, and ​ based on its analysis, determined that there were no uncertain tax positions. ​ The Company’s U.S. Federal and State income tax returns prior to fiscal 2014 are closed and ​ management continually evaluates expiring statutes of limitations, audits, proposed settlements, ​ changes in tax law and new authoritative rulings. ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Financial Statements ​ Year Ended December 31, 2017 ​ ​ ​ 8 ​ ​ Subsequent Events ​ The Company has evaluated subsequent events for potential recognition and/or disclosure through ​ March 13, 2018, the date these financial statements were available to be issued. ​ ​ 3. Fixed Assets ​ The Company’s fixed assets are comprised of the following at December 31, 2017: ​ Accumulated ​ Depreciation Net Book​ Cost and Amortization Value​ Telephone sy tems 62,828$ 51,110$ 11,718$ ​ Software 651,156 441,975 209,181 ​ Leasehold improvements 97,150 65,804 31,346 ​ Computer equipment 96,796 87,796 9,000 ​ Termina s 285,214 142,137 143,077 ​ Trucks 24,576 3,277 21,299 ​ Website 5,205 5,205 - ​ Totals 1,222,925$ 797,304$ 425,621$ ​ ​ ​ Depreciation and amortization expense related to fixed assets for the year ended December 31, ​ 2017 was approximately $214,000. ​ ​ 4. Goodwill ​ The carrying value of goodwill at December 31, 2017 is approximately $1,908,000. The Company ​ performed a qualitative assessment to determine if it is more likely than not that the Company’s ​ fair value is less than its carrying amount. Based on its qualitative assessment, the Company ​ determined that goodwill was not impaired at December 31, 2017 and nofurther assessment was ​ required. ​ ​ ​ 5. Customer Merchant Accounts ​ The net carrying value of customer merchant accounts is approximately $760,000 which consists of ​ approximately $2,806,000 of gross costs, net of accumulated amortization of approximately ​ $2,046,000 at December 31, 2017. Customer merchant accounts are being amortized over 66 ​ months. Total amortization expense of customer merchant accounts using the sum of the year’s ​ digits was approximately $494,000. ​ Total expected amortization expense for the next five fiscal years and thereafter is as follows: ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Financial Statements ​ Year Ended December 31, 2017 ​ ​ ​ 9 ​ ​ Year Ending December 31,​ 2018 371,530$ ​ 2019 242,330 ​ 2020 121,287 ​ 2021 22,884 ​ 2022 1,980 ​ Thereafter - ​ 760,011$ ​ ​ ​ 6. Bank Note Payable, Net of Deferred Financing Costs ​ In June 2015, the Company, Newtek Technology Solutions, Inc. (“NTS”) and Premier Payments ​ LLC (“Premier”), all subsidiaries of Holdco, collectively as “Borrowers” entered into a Credit and ​ Guarantee Agreement (the “Agreement”) with Goldman Sachs Bank USA which extended a multi ​ draw term loan facility (the “Facility”) up to an aggregate principal amount of $38,000,000. In June ​ 2017, the Company amended the terms of the Agreement to extend the term of the Facility to June ​ 2021 as well as increase the aggregate principal amount of the Facility to $50,000,000. ​ Furthermore, the amendment of the Agreement added banc-serv Partners, LLC (“banc-serv”) and ​ Small Business Lending, LLC (“SBL”), which are both owned by Holdco’s parent, Newtek ​ Business Services Corp. (“Newtek”), as Borrowers. Concurrent with the increase in the aggregate ​ principal balance, the Company borrowed an additional $18,000,000 under the Facility. The total ​ outstanding balance under the Facility as of December 31, 2017 was $40,000,000. TheBorrowers ​ are collectively liable for the outstanding balance under the Facility. All assets of the Borrowers are ​ pledged as collateral under the Agreement and the Facility is guaranteed by Newtek. The Facility ​ provides for monthly/quarterly interest only payments with total principal due at maturity. The ​ Facility matures in June 2021. Borrowings under the facility are classified either as a “Base Rate ​ Loan” or a “LIBOR Rate Loan” at the Company’s election. Each LIBOR Rate Loan shall bear ​ interest on the outstanding balance at a rate equal to (a) the greater of LIBOR or 50 basis points ​ plus (b) 6%, and each Base Rate Loan shall bear interest on the outstanding balance at a rate equal ​ to (y) the greater of the Prime Rate or 350 basis points, plus (z) 5%. The effective interest rate at ​ December 31, 2017 was 7.69%. The Company may make principal payments within 24 months of ​ the closing date and pay a prepayment premium based on a percentage of the principal outstanding ​ as defined in the Agreement. After 24 months, principal may be repaid under no penalty. The ​ Agreement requires certain restrictive covenants for which the Company is in compliance with as ​ of December 31, 2017. At December 31, 2017, the Company had approximately $30,499,000 of ​ total borrowings outstanding under the Facility. Interest expense and amortization of deferred ​ financingcosts for the year ended December 31, 2017 was approximately $2,085,000. ​ ​ Outstanding borrowings under the Bank note payable consisted of the following at December 31, ​ 2017: ​ ​ Principal 30,498,694$ ​ Unamortized deferred financing costs (641,815) ​ Net carrying amount 29,856,879$ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Financial Statements ​ Year Ended December 31, 2017 ​ ​ ​ 10 ​ ​ 7. Notes Receivable – Related Party ​ The Company had $6,110,000 outstanding on its revolving line of credit with Newtek, at December ​ 31, 2017. The line, which matures in June 2021, allows for maximum borrowings of $50,000,000 ​ and bears interest at a rate equal to that in effect under the Company’s Facility, at any given time. ​ The Company recorded related party interest income of approximately $589,000 during the year ​ ended December 31, 2017. At December 31, 2017 there was approximately $85,000 in accrued ​ interest income under the line. ​ ​ 8. Related Party Transactions ​ The Company earned electronic payment processing revenue of approximately $91,000 from ​ Premier. The Company incurred residual expenses totaling approximately $3,922,000 from several ​ related parties. In addition, the Company incurred gateway fees of approximately $121,000 from ​ Secure Cyber Gateway Services, LLC, and breach insurance costs of approximately $332,000 from ​ Newtek Insurance Agency, LLC, which are included in electronic payment processing costs – ​ related parties on the statement of income. Salaries and overhead costs of approximately $147,000 ​ charged from NTS areincluded in salaries and benefits. Payroll processing costs of approximately ​ $21,000 from PMTWorks Payroll, LLC and managed technology services of approximately ​ $161,000 from NTS are included in other general and administrative costs. At December 31, 2017, ​ total amounts due to and due from related parties are approximately $586,000 and $103,000, ​ respectively. ​ Included in salaries and benefits are charges from Newtek related to salaries for management and ​ certain other employees that perform services for the Company. Total amounts allocated to the ​ Company for the year ended December 31, 2017, were approximately $407,000. ​ During the year ended December 31, 2017, the Company purchased approximately $66,000 of ​ customer merchant accounts from a related party. ​ The Company’s parent, Holdco, and Newtek are both guarantors of the Facility with Goldman ​ Sachs Bank USA. ​ ​ ​ 9. Commitments and Contingencies ​ Operating Commitments ​ The Company entered into noncancellable operating leases for office facilities with future rentals ​ as follows: ​ Year Ending December 31,​ 2018 54,543$ ​ 2019 56,239 ​ 2020 52,978 ​ 163,760$ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Financial Statements ​ Year Ended December 31, 2017 ​ ​ ​ 11 ​ ​ Total rent expense for the year ended December 31, 2017 was approximately $288,000. ​ ​ Under the amended terms of a Service Agreement, amended terms of a Merchant Program ​ Processing Agreement, amended terms of a Preferred Card Agreement, and amended terms of a ​ Marketing Agreement, UPS-WI is required to pay minimum fees of $4,200,000 in total under these ​ agreements during the period January 1, 2017 through December 31, 2017. The term of the Service ​ agreement was extended to December 31, 2018. The Merchant Program Processing Agreement ​ initial term was extended to November 30, 2018 and renews automatically each year. The ​ Marketing Agreement initial term was extended to May 31, 2018 and renews automatically each ​ two years for two year terms. The Preferred Card Agreement initial term was extended to April 30, ​ 2018 and renews automatically for six-month terms. ​ Under the terms of an Independent Sales Organization Agreement and Member Services Provider ​ Agreement between UPS-WI and one of their sponsoring banks, UPS-WI is required to pay ​ monthly minimum fees of $10,000 during the term of the agreement. The Company exceeded the ​ monthly minimumrequired amount under the agreement for the year ended December 31, 2017. ​ The agreement renews automatically annually. ​ Under the amended terms of a Processing Services Agreement between UPS-WI and one of their ​ front-end processors, UPS-WI is required to pay a quarterly minimum of $68,000 during the term ​ of the amended agreement. The Company’s fee payments for the 12-month period ended December ​ 31, 2017, exceeded the minimum required amount under these agreements. The agreement expires ​ July 2018. ​ ​ Litigation ​ In 2013, the Federal Trade Commission (the “FTC”) amended an existing complaint in the matter ​ Federal Trade Commission v. WV Universal Management, LLC et al., in the United States District ​ Court for the Middle District of Florida (the “Court”), to add UPS-WI as an additional defendant ​ on one count of providing substantial assistance in violation of the Telemarketing Sales Rule. On ​ November 18, 2014, the Court issued an Order granting the FTC’s motion for summary judgment ​ against UPS-WI on the single count. Subsequently, the FTC filed motions for a permanent ​ injunction and equitable monetary relief against UPS-WI and the other remaining defendants. Prior ​ to the Court hearing on the motions, UPS-WI and the FTC reached a settlement on the FTC’s ​ motion for a permanent injunction. On May 19, 2015, the Court entered anequitable monetary ​ judgment against UPS-WI for $1,735,000. The $1,735,000 was fully expensed in 2014 by UPS-WI. ​ ​ On June 14, 2016, the United States Court of Appeals for the Eleventh Circuit vacated the Court’s ​ order awarding joint and several liability for equitable monetary relief in the amount of $1,735,000 ​ against UPS-WI, and remanded the case to the Court for findings of fact and conclusions of law as ​ to whether and why UPS-WI should be jointly and severally liable for restitution, and in what ​ amount, if any. On October 26, 2016, the Court entered an equitable monetary judgment against ​ UPS-WI for $1,735,000. On December 13, 2017, the United States Court of Appeals for the ​ Eleventh Circuit affirmed the Court’s order awarding joint and several liability for equitable ​ monetary relief against UPS-WI. UPS-WI intends to file a petition for a writ of ​ certiorari requesting that the United States Supreme Court review the judgment. ​ ​ In September 2014, UPS-WI instituted an action against a former independent sales agent in ​ Wisconsin state court for, among other things, breach of contract. The former sales agent answered ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Financial Statements ​ Year Ended December 31, 2017 ​ ​ ​ 12 ​ ​ the complaint and filed counterclaims against UPS-WI. Following UPS-WI’s successful appeal of ​ several of the court’s rulings, the action has been assigned to a new judge for further proceedings. ​ UPS-WI intends to vigorously pursue its claims against the former sales agent and defend the ​ counterclaims asserted. ​ ​ ​ Universal Processing Services of ​ Wisconsin, LLC (A Limited Liability ​ Company) ​ ​ Financial Report ​ and Independent Auditor’s Report ​ Year Ended December 31, 2016 ​ ​ ​ Universal Processing Services of Wisconsin, LLC ​ Index ​ Year Ended December 31, 2016 ​ ​ Pages ​ Independent Auditor’s Report ................................................................................................................... 1 ​ Financial Statements ​ Balance Sheet ................................................................................................................................................ 2 ​ Statement of Income ..................................................................................................................................... 3 ​ Statement of Changes in Member’s Deficit .................................................................................................. 4 ​ Statement of Cash Flows .............................................................................................................................. 5 ​ Notes to Financial Statements .................................................................................................................. 6-13 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 1 ​ ​ INDEPENDENT AUDITOR’S REPORT ​ ​ To the Board of Directors and Stockholders ​ of Universal Processing Services of Wisconsin, LLC ​ ​ We have audited the accompanying financial statements of Universal Processing Services of Wisconsin, ​ LLC (the “Company”), which comprise the balance sheet as of December 31, 2016, and the related ​ statements of income, member’s deficit, and cash flows for the year then ended, and the related notes to ​ the financial statements. ​ Management’s Responsibility for the Financial Statements ​ Management is responsible for the preparation and fair presentation of these financial statements in ​ accordance with accounting principles generally accepted in the United States of America; this includes the ​ design, implementation, and maintenance of internal control relevant to the preparation and fair ​ presentation of financial statements that are free from material misstatement, whether due to fraud or error. ​ Auditor’s Responsibility ​ Our responsibility is to express an opinion on these financial statements based on our audit. We conducted ​ our audit in accordance with auditing standards generally accepted in the United States of America. Those ​ standards require that we plan and perform the audit to obtain reasonable assurance about whether the ​ financial statements are free from material misstatement. ​ An audit involvesperforming procedures to obtain audit evidence about the amounts and disclosures in the ​ financial statements. The procedures selected depend on the auditor’s judgment, including the assessment ​ of the risks of material misstatement of the financial statements, whether due to fraud or error. In making ​ those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair ​ presentation of the financial statements in order to design audit procedures that are appropriate in the ​ circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal ​ control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of ​ accounting policies used and the reasonableness of significant accounting estimates made by management, ​ as well as evaluating the overall presentation of the financial statements. ​ We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our ​ audit opinion. ​ Opinion ​ In our opinion, the financial statements referred to above present fairly, in all material respects, the financial ​ position of Universal Processing Services of Wisconsin, LLC as of December 31, 2016, and the results of ​ its operations and its cash flows for the year then ended in accordance with accounting principles generally ​accepted in the United States of America. ​ ​ ​ ​ New York, New York ​ February 22, 2017 ​ ​ Universal Processing Services of Wisconsin, LLC ​ Balance Sheet ​ December 31, 2016 ​ See notes to financial statements. ​ ​ 2 ​ ​ Assets​ Current Assets:​ Cash 7,898,628$ ​ Accounts receivable 3,115,054 ​ Prepaid expenses and other current assets 263,066 ​ Inventory 245,500 ​ Total current assets 11,522,248 ​ Fixed assets, net 402,040 ​ Customer merchant accounts, net 1,191,600 ​ Restricted cash 587,707 ​ Due from related parties 317,103 ​ Notes receivable - related party 500,000 ​ Goodwill 1,908,495 ​ Total assets 16,429,193$ ​ Liabilities and Member's Deficit​ Liabilities:​ Current Liabilities:​ Accounts payable and accrued expenses 3,484,204$ ​ Residuals payable 868,087 ​ Due to related parties 464,045 ​ Chargeback reserves 802,722 ​ Total current liabilities 5,619,058 ​ Bank note payable, net of deferred financing costs 16,431,529 ​ Total liabilities 22,050,587 ​ Commitments and contingencies (Note 9)​ Member's deficit (5,621,394) ​ Total liabilities and member's deficit 16,429,193$ ​ ​ Universal Processing Services of Wisconsin, LLC ​ Statement of Income ​ Year Ended December 31, 2016 ​ See notes to financial statements. ​ ​ 3 ​ ​ Revenue:​ Electronic payment processing 103,885,710$ ​ Expenses:​ Electronic payment processing costs 88,013,827 ​ Salaries and benefits 4,677,273 ​ Professional fees 783,846 ​ Depreciation and amortization 799,006 ​ Other general and administrative costs 1,221,448 ​ Total expenses 95,495,400 ​ Income from operations 8,390,310 ​ Interest expense, net (1,588,970) ​ Interest income - related party 183,050 ​ Net income 6,984,390$ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC ​ Statement of Changes in Member’s Deficit ​ Year Ended December 31, 2016 ​ See notes to financial statements. ​ ​ 4 ​ ​ Member's Deficit​ Balance, January 1, 2016 (3,495,974)$ ​ Net income 6,984,390 ​ Member distributions (9,109,810) ​ Balance, December 31, 2016 (5,621,394)$ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC ​ Statement of Cash Flows ​ Year Ended December 31, 2016 ​ See notes to financial statements. ​ 5 ​ ​ ​ Cash flows from operating activities:​ Net income 6,984,390$ ​ Adjustments to reconcile net income to net cash provided by operating activities:​ Depreciation and amortization 799,006 ​ Amortization of deferred financing costs 257,232 ​ Changes in operating assets and liabilities:​ Restricted cash (94,992) ​ Accounts receivable (569,643) ​ Prepaid expenses and other current assets (179,718) ​ Inventory 41,975 ​ Accounts payable, accrued expenses and other current liabilities 1,508,596 ​ Due to/from related parties 260,352 ​ Net cash provided by operating activities 9,007,198 ​ Cash flows from investing activities:​ Purchase of customer merchant accounts (152,103) ​ Principal payments received on related party note 5,146,749 ​ Purchase of fixed assets (203,472) ​ Net cash provided by investing activities 4,791,174 ​ Cash flows used in financing activities:​ Distributions to member (9,109,810) ​ Net increase in cash 4,688,562 ​ Cash, beginning of year 3,210,066 ​ Cash, end of year 7,898,628$ ​ Supplemental disclosure of cash flow information​ Interest paid 1,236,274$ ​ ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC ​ Notes to Financial Statements ​ Year Ended December 31, 2016 ​ ​ 6 ​ 1. Organization, Description of Business, and Basis of Presentation ​ Universal Processing Services of Wisconsin, LLC (“UPS-WI”), was organized as a limited liability ​ company (“LLC”) under the laws of the State of Wisconsin and is a wholly-owned subsidiary of ​ Newtek Business Services Holdco 1, Inc. (“Holdco”). As a limited liability company, the liability ​ of Holdco is limited to its capital account. ​ UPS-WI and its formerly wholly-owned subsidiary, Solar Processing Services, LLC (“Solar”) are ​ collectively hereinafter referred to as the “Company”. In June 2016, Solar merged into UPS-WI. ​ The Company markets credit and debit card processing services, check approval services and ​ ancillary processing equipment and software to merchants who accept credit cards, debit cards, ​ checks and other non-cash forms of payment. ​ ​ 2. Significant Accounting Policies ​ Use of Estimates ​ The preparation of the financial statements in conformity with accounting principles generally ​ accepted in the United States of America requires management to make estimates and assumptions ​ that affect the reported amounts of assets and liabilities and disclosures of contingent assets and ​ liabilities at the date of the financial statements and the reported amounts of revenuesand expenses ​ during the reporting period. Estimates, by their nature, are based on judgment and available ​ information. Actual results could differ from those estimates. Material estimates that are ​ particularly susceptible to significant changes in the near term relate to the determination of the ​ reserve for chargeback losses. ​ ​ Recently Adopted Accounting Standards ​ In April 2015, the Financial Accounting Standards Board issued ASU 2015-03 “Simplifying the ​ Presentation of Debt Issuance Costs.” This update requires that debt issuance costs be presented in ​ the balance sheet as a direct deduction from the debt liability. The Company adopted this standard ​ with respect to its Bank note payable. ​ ​ Financial Instruments ​ The Company’s financial instruments include cash, accounts receivable, accounts payable and ​ accrued expenses, residuals payable, notes receivable from a related party and a bank note payable. ​ The carrying amounts of cash, accounts receivable, accounts payable and accrued expenses and ​ residuals payable approximate fair value due to their short term maturities. ​ The carrying amounts of notes receivable from a related party and bank note payable approximate ​ fair value due to the variable interest rate they carry. ​ ​ Cash ​ The Company maintains cash balances at financial institutions of high credit quality. Asof ​ December 31, 2016, cash deposits in excess of insured amounts totaled approximately $7,683,000. ​ ​ ​ Universal Processing Services of Wisconsin, LLC ​ Notes to Financial Statements ​ Year Ended December 31, 2016 ​ ​ 7 ​ Restricted Cash ​ Under the terms of the processing agreement between UPS-WI and its processing banks, UPS-WI ​ maintains cash accounts as reserves against chargeback losses. As the Company receives fees from ​ the processing bank, a certain percentage is allocated to the cash reserve account. ​ Inventory ​ Inventory consists primarily of equipment to be installed in merchant locations to enable them to ​ process electronic transactions. Inventory is stated at the lower of cost or market, which is ​ determined on a FIFO (first in-first out) basis. ​ ​ Fixed Assets ​ Fixed assets, which are comprised of telephone systems, software, website, computer equipment ​ and leasehold improvements, are stated at cost less accumulated depreciation and amortization. ​ Depreciation of fixed assets is provided on a straight-line basis using estimated useful lives of the ​ related assets. Amortization of leasehold improvements is provided on a straight-line basis using ​ the lesser of the useful life of the asset, which generally is three to five years, or lease term. ​ ​ Goodwill and Customer Merchant Accounts ​ Goodwill is not amortized but is instead subject to impairment testing, at least annually. Customer ​ merchant accounts with finite lives are amortized over 66months as discussed in Note 5. ​ The Company considers the following to be some examples of indicators that may trigger an ​ impairment review: (i) significant under-performance or loss of key contracts acquired in an ​ acquisition relative to expected historical or projected future operating results; (ii) significant ​ changes in the manner or use of the acquired assets or in the Company’s overall strategy with ​ respect to the manner or use of the acquired assets or changes in the Company’s overall business ​ strategy; (iii) significant negative industry or economic trends; (iv) increased competitive ​ pressures; (v) a significant decline in the Company’s fair market value for a sustained period of ​ time; and (vi) regulatory changes. In assessing the recoverability of the Company’s goodwill and ​ customer merchant accounts, the Company must make assumptions regarding estimated future cash ​ flows and other factors to determine the fair value of the respective assets. These include ​ estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-​ term rate of growth for the Company, the period over which cash flows will occur, and ​ determination of the Company’s cost of capital. Changes in these estimates and assumptions could ​ materially affect the determination of fair value and conclusion on impairment. ​ ​ Revenue Recognition ​ ElectronicPayment Processing ​ Electronic payment processing and fee income is derived from the electronic processing of credit ​ and debit card transactions that are authorized and captured through third-party networks. ​ Typically, merchants are charged for these processing services as a percentage of each transaction ​ dollar plus a flat fee per transaction. Certain merchant customers are charged miscellaneous fees, ​ including fees for handling charge-backs or returns, monthly minimum fees, statement fees and ​ fees for other miscellaneous services. Revenues derived from the electronic processing of ​ MasterCard®, Visa® and Discover® sourced credit and debit card transactions are reported gross of ​ amounts paid to sponsor banks. ​ Interest Income ​ ​ Universal Processing Services of Wisconsin, LLC ​ Notes to Financial Statements ​ Year Ended December 31, 2016 ​ ​ 8 ​ Interest income is recorded on an accrual basis, when earned, based on the current lending rate in ​ place. ​ ​ Reserve for Losses on Merchant Accounts ​ Disputes between a cardholder and a merchant periodically arise as a result of, among other things, ​ cardholder dissatisfaction with merchandise quality or merchant services. Such disputes may not be ​ resolved in the merchant’s favor. In these cases, the transaction is “charged back” to the merchant, ​ which means the purchase price is refunded to the customer through the merchant’s acquiring bank ​ and charged to the merchant. If the merchant has inadequate funds, the Company or, under limited ​ circumstances, the Company and the acquiring bank, must bear the credit risk for the full amount ​ of the transaction. The Company evaluates its risk for such transactions and estimates its potential ​ loss for charge-backs based primarily on historical experience and other relevant factors. ​ The Company records reserves for charge-backs and contingent liabilities when such amounts are ​ deemed to be probable and estimable. The required reserves may change in the future due to new ​ developments, including, but not limited to, changes in litigation or increased charge-back ​ exposure as the result of merchant insolvency, liquidation, or other reasons. The required reserves ​ are reviewed periodically to determine if adjustments are required. ​ ​ Electronic Payment Processing Costs ​ Electronic payment processing costs consist principally of costs directly related to the processing of ​ merchant sales volume, including interchange fees, Visa®, MasterCard® and Discover® dues and ​ assessments, bank processing fees and costs paid to third-party processing networks. Such costs ​ are recognized at the time the merchant transactions are processed or when the services are ​ performed. Two of the most significant components of electronic processing expenses include ​ interchange and assessment costs, which are set by the credit card associations. Interchange costs ​ are passed on to the entity issuing the credit card used in the transaction and assessment costs are ​ retained by the credit card associations. Interchange and assessment fees are billed primarily as a ​ percentage of dollar volume processed and, to a lesser extent, as a per transaction fee. In addition ​ to costs directly related to the processing of merchant sales volume, electronic payment processing ​ costs also include residual expenses. Residual expenses represent fees paid to third-party sales ​ referral sources. Residualexpenses are paid in accordance with contracted terms. These are ​ generally linked to revenues derived from merchants successfully referred to the Company and that ​ begin using the Company for merchant processing services. Such residual expenses are ​ recognized in the Company’s statement of income. During the year ended December 31, 2016, the ​ Company partnered with two sponsor banks for substantially all merchant transactions. ​ Substantially all merchant transactions were processed by one merchant processor. ​ ​ Income Taxes ​ The Company is a limited liability company (“LLC”) and therefore pays no corporate taxes. The ​ Company’s income, instead, passes through to its member. Accordingly, no liability for Federal, ​ State and/or local income taxes has been recorded in the accompanying financial statements. As a ​ wholly-owned subsidiary of Holdco, the Company evaluated its tax positions at year end, and ​ based on its analysis, determined that there were no uncertain tax positions. ​ The Company’s U.S. Federal and State income tax returns prior to fiscal 2013 are closed and ​ management continually evaluates expiring statutes of limitations, audits, proposed settlements, ​ changes in tax law and new authoritative rulings. ​ ​ ​ Universal Processing Services of Wisconsin, LLC ​ Notes to Financial Statements ​ Year Ended December 31, 2016 ​ ​ 9 ​ Subsequent Events ​ The Company has evaluated subsequent events for potential recognition and/or disclosure through ​ February 22, 2017, the date these financial statements were available to be issued. ​ ​ 3. Fixed Assets ​ The Company’s fixed assets are comprised of the following at December 31, 2016: ​ Accumulated ​ Depreciation Net Book​ Cost and Amortization Value​ Telephone systems 375,861$ 155,621$ 220,240$ ​ Software 488,791 331,712 157,079 ​ Leasehold improvements 63,644 53,227 10,417 ​ Computer equipment 93,257 79,040 14,217 ​ Website 5,205 5,118 87 ​ Totals 1,026,758$ 624,718$ 402,040$ ​ ​ ​ Depreciation expense related to fixed assets for the year ended December 31, 2016 was ​ approximately $198,000. ​ ​ 4. Goodwill ​ The carrying value of goodwill at December 31, 2016 is approximately $1,908,000. The Company ​ performed a qualitative assessment to determine if it is more likely than not that the Company’s ​ fair value is less than its carrying amount. Based on its qualitative assessment, the Company ​ determined that goodwill was not impaired at December 31, 2016 and no further assessment was ​ required. ​ ​ ​ 5. Customer Merchant Accounts ​ The net carrying valueof customer merchant accounts is approximately $1,192,000 which consists ​ of approximately $2,744,000 of gross costs, net of accumulated amortization of approximately ​ $1,552,000 at December 31, 2016. Customer merchant accounts are being amortized over 66 ​ months. Total amortization expense of customer merchant accounts using the sum of the year’s ​ digits is included in depreciation and amortization in the accompanying statement of income was ​ approximately $601,000. ​ Total expected amortization expense for the next five fiscal years and thereafter is as follows: ​ ​ Universal Processing Services of Wisconsin, LLC ​ Notes to Financial Statements ​ Year Ended December 31, 2016 ​ ​ 10 ​ Year Ending December 31,​ 2017 480,935 ​ 2018 353,545 ​ 2019 228,385 ​ 2020 111,382 ​ 2021 17,025 ​ Thereafter 328 ​ 1,191,600$ ​ ​ ​ 6. Bank Note Payable, Net of Deferred Financing Costs ​ In June 2015, the Company, CrystalTech Web Hosting, Inc. (“CrystalTech”) and Premier ​ Payments LLC (“Premier”), all subsidiaries of Holdco, collectively as “Borrowers” entered into a ​ Credit and Guarantee Agreement (the “Agreement”) with Goldman Sachs Bank USA which ​ extended a multi draw term loan facility (the “Facility”) up to an aggregate principal amount of ​ $38,000,000. The total outstanding balance under the Facility as of December 31, 2016 was ​ $22,000,000. The Borrowers are collectively liable for the outstanding balance under the Facility. ​ All assets of the Borrowers are pledged as collateral under the Agreement and the Facility is ​ guaranteed by Holdco’s parent, Newtek Business Services Corp (“Newtek”). The Facility provides ​ for monthly/quarterly interest only payments with total principal due at maturity. The Facility ​ matures in June 2019. Borrowings under the facility are classified either as a “Base Rate Loan” or a ​ “LIBOR Rate Loan” at the Company’s election. Each LIBOR Rate Loan shall bear interest on the ​ outstanding balance at arate equal to (a) the greater of LIBOR or 50 basis points plus (b) 7%, and ​ each Base Rate Loan shall bear interest on the outstanding balance at a rate equal to (y) the greater ​ of the Prime Rate or 350 basis points, plus (z) 6%. The effective interest rate at December 31, 2016 ​ was 7.67%. The Company may make principal payments within 24 months of the closing date and ​ pay a prepayment premium based on a percentage of the principal outstanding as defined in the ​ Agreement. After 24 months, principal may be repaid under no penalty. The Agreement requires ​ certain restrictive covenants for which the Company is in compliance with as of December 31, ​ 2016. At December 31, 2016, the Company had approximately $16,999,000 of total borrowings ​ outstanding under the Facility. Interest expense and amortization of deferred financing costs for the ​ year ended December 31, 2016 was approximately $1,608,000. ​ ​ Outstanding borrowings under the Bank note payable consisted of the following at December 31, ​ 2016: ​ ​ Principal 16,998,694$ ​ Unamortized deferred financing costs (567,165) ​ Net carrying amount 16,431,529$ ​ ​ ​ 7. Notes Receivable – Related Party ​ The Company had $500,000 outstanding on its revolving line of credit with Newtek, at December ​ 31, 2016. The line, which matures in June 2019, allows for maximum borrowings of$38,000,000 ​ and bears interest at a rate equal to that in effect under the Company’s Facility, at any given time. ​ The Company recorded related party interest income of approximately $183,000 during the year ​ ​ Universal Processing Services of Wisconsin, LLC ​ Notes to Financial Statements ​ Year Ended December 31, 2016 ​ ​ 11 ​ ended December 31, 2016. At December 31, 2016 there was approximately $188,000 in accrued ​ interest income under the line. ​ ​ 8. Related Party Transactions ​ The Company earned electronic payment processing revenue of approximately $45,000 from ​ Premier. The Company incurred residual expenses totaling approximately $3,878,000 from several ​ related parties. In addition, the Company incurred gateway fees of approximately $138,000 from ​ Secure Cyber Gateway Services, LLC, and breach insurance costs of approximately $270,000 from ​ Newtek Insurance Agency, LLC, which are included in electronic payment processing costs on the ​ statement of income. Salaries and overhead costs of approximately $36,000 charged from ​ CrystalTech are included in salaries and benefits. Payroll processing costs of approximately ​ $20,000 from PMTWorks Payroll, LLC and managed technology services of approximately ​ $160,000 from CrystalTech are included in other general and administrative costs. At December ​ 31, 2016, total amounts due to related parties are approximately $147,000. ​ Included in salaries and benefits are charges from Newtek related to salaries for management and ​ certainother employees that perform services for the Company. Total amounts allocated to the ​ Company for the year ended December 31, 2016, were approximately $468,000. ​ The Company’s parent, Holdco, and Newtek are both guarantors of the Facility with Goldman ​ Sachs Bank USA. ​ ​ ​ 9. Commitments and Contingencies ​ Operating Commitments ​ The Company entered into noncancellable operating leases for office facilities with future rentals ​ as follows: ​ ​ Year Ending December 31,​ 2017 181,067 ​ 181,067$ ​ ​ ​ Total rent expense for the year ended December 31, 2016 was approximately $186,000. ​ ​ Under the amended terms of a Service Agreement, amended terms of a Merchant Program ​ Processing Agreement, amended terms of a Preferred Card Agreement, and amended terms of a ​ Marketing Agreement, UPS-WI is required to pay minimum fees of $4,200,000 in total under these ​ agreements during the period January 1, 2016 through December 31, 2017. The term of the Service ​ agreement was extended to December 31, 2018. The Merchant Program Processing Agreement ​ initial term was extended to November 30, 2018 and renews automatically each year. The ​ Marketing Agreement initial term was extended to May 31, 2018 and renews automatically each ​ two years for two year terms. The Preferred Card Agreement initial term was extended toApril 30, ​ 2018 and renews automatically for six-month terms. ​ ​ Universal Processing Services of Wisconsin, LLC ​ Notes to Financial Statements ​ Year Ended December 31, 2016 ​ ​ 12 ​ Under the terms of an Independent Sales Organization Agreement and Member Services Provider ​ Agreement between UPS-WI and one of their sponsoring banks, UPS-WI is required to pay ​ monthly minimum fees of $10,000 during the term of the agreement. The Company exceeded the ​ monthly minimum required amount under the agreement for the year ended December 31, 2016. ​ The agreement renews automatically annually. ​ Under the amended terms of a Processing Services Agreement between UPS-WI and one of their ​ front-end processors, UPS-WI is required to pay a quarterly minimum of $68,000 during the term ​ of the amended agreement. The Company’s fee payments for the 12-month period ended December ​ 31, 2016, exceeded the minimum required amount under these agreements. The agreement expires ​ July 2018. ​ ​ Litigation ​ In 2013, the Federal Trade Commission (the “FTC”) amended an existing complaint in the matter ​ Federal Trade Commission v. WV Universal Management, LLC et al., pending in the United States ​ District Court for the Middle District of Florida (the “Court”), to add UPS-WI, as an additional ​ defendant on one count of providing substantial assistance in violation of the Telemarketing Sales ​ Rule. OnNovember 18, 2014, the Court issued an Order granting the FTC’s motion for summary ​ judgment against UPS-WI on the single count. Subsequently, the FTC filed motions for a ​ permanent injunction and equitable monetary relief against UPS-WI and the other remaining ​ defendants. Prior to the Court hearing on the motions, UPS-WI and the FTC reached a settlement ​ on the FTC’s motion for a permanent injunction. The Court granted the FTC’s motion for ​ equitable relief against UPS-WI and the other remaining defendants, ordering that the remaining ​ defendants pay approximately $1,735,000 in equitable monetary relief. This amount was deposited ​ with the Court pending the outcome of an appeal of the judgement. ​ ​ On June 14, 2016, the United States Court of Appeals for the Eleventh Circuit set aside the Court’s ​ judgment awarding joint and several liability for equitable monetary relief in the amount of ​ approximately $1,735,000 against UPS-WI, and remanded the case to the Court for findings of fact ​ and conclusions of law as to whether and why UPS-WI should be jointly and severally liable for ​ restitution, and in what amount, if any. On October 18, 2016, the Court ordered that the ​ $1,735,000 payment be returned to UPS-WI. On October 26, 2016, the Court entered an equitable ​ monetary judgment against UPS-WI for approximately $1,735,000. UPS-WI has filed a notice of ​ appeal of thejudgment. The total $1,735,000 has been accrued and is included in the balance sheet ​ in Accounts payable and accrued expenses. There is no current year income statement effect. ​ ​ In January 2014, NCMIC Finance Corporation (“NCMIC”) filed a complaint against the Company ​ in the United States District Court for the Southern District of Iowa. The complaint asserted claims ​ against the Company for breach of the UPS-WI and NCMIC agreement for the processing of credit ​ card transactions, and seeks monetary relief. In April 2016, in order to avoid the cost of trial and ​ any appeals, UPS-WI settled the matter for $200,000. The total $200,000 was paid during 2016 and ​ is included in the statement of income in other general and administrative costs. ​ In September 2014, UPS-WI filed an action in Wisconsin state court against a former independent ​ sales agent and his company. The complaint alleges several causes of action including breach of ​ contract. The defendant filed an answer and filed counterclaims against UPS-WI seeking monetary ​ damages. The court granted certain aspects of defendants’ motions for summary judgment, ​ ​ Universal Processing Services of Wisconsin, LLC ​ Notes to Financial Statements ​ Year Ended December 31, 2016 ​ ​ 13 ​ dismissing certain of the claims asserted by UPS-WI. The matter is presently stayed pending the ​ Wisconsin Supreme Court’s ruling on matters under appeal. ​ ​ ​ Universal Processing Services of ​ Wisconsin, LLC (A Limited Liability ​ Company) and Subsidiary ​ ​ Consolidated Financial Report ​ and Independent Auditor’s Report ​ Year Ended December 31, 2015 ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Index ​ Year Ended December 31, 2015 ​ ​ Pages ​ Independent Auditor’s Report ................................................................................................................... 1 ​ Financial Statements ​ Consolidated Balance Sheet .......................................................................................................................... 2 ​ Consolidated Statement of Income ............................................................................................................... 3 ​ Consolidated Statement of Changes in Member’s Deficit ............................................................................ 4 ​ Consolidated Statement of Cash Flows ........................................................................................................ 5 ​ Notes to Consolidated Financial Statements ............................................................................................ 6-12 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Independent Auditor's Report ​ To the Board of Directors and Member of ​ Universal Processing Services of Wisconsin, LLC ​ We have audited the accompanying consolidated financial statements of Universal Processing Services ​ of Wisconsin, LLC and Subsidiary, which comprise the consolidated balance sheet as of December 31, ​ 2015, and the related consolidated statements of income, changes in member’s deficit and cash flows for ​ the year then ended, and the related notes to the financial statements. ​ Management's Responsibility for the Financial Statements ​ Management is responsible for the preparation and fair presentation of these consolidated financial ​ statements in accordance with accounting principles generally accepted in the United States of America; ​ this includes the design, implementation, and maintenance of internal control relevant to the preparation ​ and fair presentation of consolidated financial statements that are free from material misstatement, ​ whether due to fraud or error. ​ Auditor's Responsibility ​ Our responsibility is to express an opinion on these consolidated financial statements based on our audit. ​ We conducted our audit in accordance with auditing standards generally accepted in the United States of ​ America. Those standards require that we plan and perform the audit to obtain reasonable assurance ​ aboutwhether the consolidated financial statements are free from material misstatement. ​ An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in ​ the consolidated financial statements. The procedures selected depend on the auditor's judgment, ​ including the assessment of the risks of material misstatement of the consolidated financial statements, ​ whether due to fraud or error. In making those risk assessments, the auditor considers internal control ​ relevant to the entity's preparation and fair presentation of the consolidated financial statements in order ​ to design audit procedures that are appropriate in the circumstances, but not for the purpose of ​ expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no ​ such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the ​ reasonableness of significant accounting estimates made by management, as well as evaluating the ​ overall presentation of the consolidated financial statements. ​ We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for ​ our audit opinion. ​ Opinion ​ In our opinion, the consolidated financial statements referred to above present fairly, in all material ​ respects, the financial position of Universal Processing Services ofWisconsin, LLC and Subsidiary as of ​ December 31, 2015, and the results of their operations and their cash flows for the year then ended in ​ accordance with accounting principles generally accepted in the United States of America. ​ C ​ Jericho, New York ​ March 2, 2016 ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Consolidated Balance Sheet ​ December 31, 2015 ​ See notes to consolidated financial statements. ​ ​ 2 ​ ​ Assets​ Current Assets:​ Cash 3,210,066$ ​ Accounts receivable 2,545,411 ​ Prepaid expenses and other current assets 83,348 ​ Inventory 287,475 ​ Total current assets 6,126,300 ​ Fixed assets, net 396,483 ​ Customer merchant accounts, net 1,640,588 ​ Deferred financing costs, net 824,397 ​ Restricted cash 492,715 ​ Due from related parties 378,188 ​ Notes receivable - related party 5,646,749 ​ Goodwill 1,908,495 ​ Total assets 17,413,915$ ​ Liabilities and Member's Deficit​ Liabilities:​ Current Liabilities:​ Accounts payable and accrued expenses 2,231,648$ ​ Residuals payable 809,843 ​ Due to related parties 264,778 ​ Chargeback reserves 604,926 ​ Total current liabilities 3,911,195 ​ Bank note payable 16,998,694 ​ Total liabilities 20,909,889 ​ Commitments and contingencies​ Member's deficit (3,495,974) ​ Total liabilities and member's deficit 17,413,915$ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Consolidated Statement of Income ​ Year Ended December 31, 2015 ​ See notes to consolidated financial statements. ​ ​ 3 ​ ​ Revenue:​ Electronic payment processing 98,474,937$ ​ Expenses:​ Electronic payment processing costs 82,505,282 ​ Salaries and benefits 5,070,083 ​ Professional fees 1,682,895 ​ Depreciation and amortization 318,262 ​ Other general and administrative costs 1,041,980 ​ Total expenses 90,618,502 ​ Income from operations 7,856,435 ​ Interest expense, net (811,383) ​ Inter st income - related party 484,222 ​ Net income 7,529,274$ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Consolidated Statement of Changes in Member’s Deficit ​ Year Ended December 31, 2015 ​ See notes to consolidated financial statements. ​ ​ 4 ​ ​ Member's Equity ​ (Deficit)​ Balance, December 31, 2014 3,537,404$ ​ Net income 7,529,274 ​ Member distributions (14,562,652) ​ Balance, December 31, 2015 (3,495,974)$ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Consolidated Statement of Cash Flows ​ Year Ended December 31, 2015 ​ See notes to consolidated financial statements. ​ 5 ​ ​ ​ Cash flows from operating activities:​ Net income 7,529,274$ ​ Adjustments to reconcile net income to net cash provided by operating activities:​ Depreciation and amortization 318,262 ​ Amortization of deferred financing costs 140,493 ​ Changes in operating assets and liabilities:​ Restricted cash 209,304 ​ Accounts receivable 1,115,267 ​ Prepaid expenses and other current assets 36,330 ​ Inventory (78,002) ​ Accounts payable, accrued expenses and other current liabilities (1,777,781) ​ Due to/from related parties (957,313) ​ Net cash provided by operating activities 6,535,834 ​ Cash flows from investing activities:​ Purchase of customer merchant accounts (1,524,853) ​ Net advances under related party note (5,646,749) ​ Purchase of fixed assets (263,761) ​ Net cash used in investing activities (7,435,363) ​ Cash flows used in financing activities:​ Distributions to member (14,562,652) ​ Proceeds from term loan 16,998,694 ​ Deferred financing costs paid (964,890) ​ Net cash provided by financing activities 1,471,152 ​ Net increase in cash 571,623 ​ Cash, beginning of year 2,638,443 ​ Cash, end of year 3,210,066$ ​ Supplemental disclosure of cashflow information​ Interest paid 680,281$ ​ ​ ​ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Consolidated Financial Statements ​ Year Ended December 31, 2015 ​ ​ 6 ​ 1. Organization, Basis of Presentation and Description of Business ​ Universal Processing Services of Wisconsin, LLC (“UPS-WI”), was organized as a limited liability ​ company (“LLC”) under the laws of the State of Wisconsin and is a wholly-owned subsidiary of ​ Newtek Business Services Holdco 1, Inc. (“Holdco”). As a limited liability company, the liability ​ of Holdco is limited to its capital account. Prior to being a wholly-owned subsidiary of Holdco, ​ UPS-WI was a wholly-owned subsidiary of The Whitestone Group, LLC (“The Whitestone ​ Group”). In 2015, the Whitestone Group transferred all of its membership interest in UPS-WI to ​ Holdco. ​ UPS-WI, and its wholly-owned subsidiary, Solar Processing Services, LLC (“Solar”), are ​ hereinafter referred to as the “Company”. The Company markets credit and debit card processing ​ services, check approval services and ancillary processing equipment and software to merchants ​ who accept credit cards, debit cards, checks and other non-cash forms of payment. ​ The accompanying consolidated financial statements include the accounts of UPS-WI and Solar. ​ All significant intercompany accounts and transactions have been eliminated in consolidation. ​ ​ ​ 2. SignificantAccounting Policies ​ Use of Estimates ​ The preparation of the consolidated financial statements in conformity with accounting principles ​ generally accepted in the United States of America requires management to make estimates and ​ assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent ​ assets and liabilities at the date of the consolidated financial statements and the reported amounts of ​ revenues and expenses during the reporting period. Estimates, by their nature, are based on ​ judgment and available information. Actual results could differ from those estimates. Material ​ estimates that are particularly susceptible to significant changes in the near term relate to the ​ determination of the reserve for chargeback losses. ​ ​ Financial Instruments ​ The Company’s financial instruments include cash, accounts receivable, accounts payable, ​ residuals payable, notes receivable from a related party and a bank note payable. ​ The carrying amounts of cash, accounts receivable, accounts payable and residuals payable ​ approximate fair value due to their short term maturities. ​ The carrying amounts of notes receivable from a related party and bank note payable approximate ​ fair value due to the variable interest rate they carry. ​ ​ Cash ​ The Company considers all highly liquid investments with maturities of three monthsor less when ​ purchased to be cash equivalents. Invested cash is held exclusively at financial institutions of high ​ credit quality. As of December 31, 2015, cash deposits in excess of insured amounts totaled ​ approximately $2,648,000. ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Consolidated Financial Statements ​ Year Ended December 31, 2015 ​ ​ 7 ​ Restricted Cash ​ Under the terms of the processing agreement between UPS-WI and its processing banks, UPS-WI ​ maintains cash accounts as reserves against chargeback losses. As the Company receives fees from ​ the processing bank, a certain percentage is allocated to the cash reserve account. ​ Inventory ​ Inventory consists primarily of equipment to be installed in merchant locations to enable them to ​ process electronic transactions. Inventory is stated at the lower of cost or market, which is ​ determined on a FIFO (first in-first out) basis. ​ ​ Fixed Assets ​ Fixed assets, which are comprised of telephone systems, software, website, computer equipment ​ and leasehold improvements, are stated at cost less accumulated depreciation and amortization. ​ Depreciation of fixed assets is provided on a straight-line basis using estimated useful lives of the ​ related assets. Amortization of leasehold improvements is provided on a straight-line basis using ​ the lesser of the useful life of the asset, which generally is three to five years, or lease term. ​ ​ Goodwill and Customer Merchant Accounts ​ Goodwill is not amortized but is instead subject to impairment testing, at least annually. Customer ​ merchant accounts with finitelives are amortized over 66 months as discussed in Note 5. ​ The Company considers the following to be some examples of indicators that may trigger an ​ impairment review outside its annual impairment review: (i) significant under-performance or loss ​ of key contracts acquired in an acquisition relative to expected historical or projected future ​ operating results; (ii) significant changes in the manner or use of the acquired assets or in the ​ Company’s overall strategy with respect to the manner or use of the acquired assets or changes in ​ the Company’s overall business strategy; (iii) significant negative industry or economic trends; ​ (iv) increased competitive pressures; (v) a significant decline in the Company’s fair market value ​ for a sustained period of time; and (vi) regulatory changes. In assessing the recoverability of the ​ Company’s goodwill and customer merchant accounts, the Company must make assumptions ​ regarding estimated future cash flows and other factors to determine the fair value of the respective ​ assets. These include estimation of future cash flows, which is dependent on internal forecasts, ​ estimation of the long-term rate of growth for the Company, the period over which cash flows will ​ occur, and determination of the Company’s cost of capital. Changes in these estimates and ​ assumptions could materially affect the determination of fair value andconclusions on goodwill ​ impairment. ​ ​ Revenue Recognition ​ Electronic Payment Processing ​ Electronic payment processing and fee income is derived from the electronic processing of credit ​ and debit card transactions that are authorized and captured through third-party networks. ​ Typically, merchants are charged for these processing services as a percentage of each transaction ​ dollar plus a flat fee per transaction. Certain merchant customers are charged miscellaneous fees, ​ including fees for handling charge-backs or returns, monthly minimum fees, statement fees and ​ fees for other miscellaneous services. Revenues derived from the electronic processing of ​ MasterCard®, Visa® and Discover® sourced credit and debit card transactions are reported gross of ​ amounts paid to sponsor banks. ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Consolidated Financial Statements ​ Year Ended December 31, 2015 ​ ​ 8 ​ Interest Income ​ Interest income is recorded on an accrual basis, when earned, based on the current lending rate in ​ place. ​ ​ Reserve for Losses on Merchant Accounts ​ Disputes between a cardholder and a merchant periodically arise as a result of, among other things, ​ cardholder dissatisfaction with merchandise quality or merchant services. Such disputes may not be ​ resolved in the merchant’s favor. In these cases, the transaction is “charged back” to the merchant, ​ which means the purchase price is refunded to the customer through the merchant’s acquiring bank ​ and charged to the merchant. If the merchant has inadequate funds, the Company or, under limited ​ circumstances, the Company and the acquiring bank, must bear the credit risk for the full amount ​ of the transaction. The Company evaluates its risk for such transactions and estimates its potential ​ loss for charge-backs based primarily on historical experience and other relevant factors. ​ The Company records reserves for charge-backs and contingent liabilities when such amounts are ​ deemed to be probable and estimable. The required reserves may change in the future due to new ​ developments, including, but not limitedto, changes in litigation or increased charge-back ​ exposure as the result of merchant insolvency, liquidation, or other reasons. The required reserves ​ are reviewed periodically to determine if adjustments are required. ​ ​ Electronic Payment Processing Costs ​ Electronic payment processing costs consist principally of costs directly related to the processing of ​ merchant sales volume, including interchange fees, Visa®, MasterCard® and Discover® dues and ​ assessments, bank processing fees and costs paid to third-party processing networks. Such costs ​ are recognized at the time the merchant transactions are processed or when the services are ​ performed. Two of the most significant components of electronic processing expenses include ​ interchange and assessment costs, which are set by the credit card associations. Interchange costs ​ are passed on to the entity issuing the credit card used in the transaction and assessment costs are ​ retained by the credit card associations. Interchange and assessment fees are billed primarily as a ​ percentage of dollar volume processed and, to a lesser extent, as a per transaction fee. In addition ​ to costs directly related to the processing of merchant sales volume, electronic payment processing ​ costs also include residual expenses. Residual expenses represent feespaid to third-party sales ​ referral sources. Residual expenses are paid in accordance with contracted terms. These are ​ generally linked to revenues derived from merchants successfully referred to the Company and that ​ begin using the Company for merchant processing services. Such residual expenses are ​ recognized in the Company’s consolidated statement of income. During the year ended December ​ 31, 2015, the Company partnered with two sponsor banks for substantially all merchant ​ transactions. Substantially all merchant transactions were processed by one merchant processor. ​ ​ Income Taxes ​ The Company is a limited liability company (“LLC”) and therefore pays no corporate taxes. The ​ Company’s income, instead, passes through to its member. Accordingly, no liability for Federal, ​ State and/or local income taxes has been recorded in the accompanying consolidated financial ​ statements. As a wholly-owned subsidiary of Holdco, the Company evaluated its tax positions at ​ year end, and based on its analysis, determined that there were no uncertain tax positions. ​ The Company’s U.S. Federal and State income tax returns prior to fiscal 2012 are closed and ​ management continually evaluates expiring statutes of limitations, audits, proposed settlements, ​ changes in tax law and new authoritative rulings. ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Consolidated Financial Statements ​ Year Ended December 31, 2015 ​ ​ 9 ​ ​ Subsequent Events ​ The Company has evaluated subsequent events for potential recognition and/or disclosure through ​ March 2, 2016, the date these consolidated financial statements were available to be issued. ​ ​ ​ 3. Fixed Assets ​ The Company’s fixed assets are comprised of the following at December 31, 2015: ​ Accumulated ​ Depreciation Net Book​ Cost and Amortization Value​ Telephone systems 273,549$ 88,423$ 185,126$ ​ Software 398,256 222,590 175,666 ​ Leasehold improvements 63,644 41,546 22,098 ​ Computer equipment 86,157 72,648 13,509 ​ Website 5,202 5,118 84 ​ Totals 826,808$ 430,325$ 396,483$ ​ ​ ​ Depreciation expense related to fixed assets for the year ended December 31, 2015 was ​ approximately $166,000. ​ ​ 4. Goodwill ​ The carrying value of goodwill at December 31, 2015 is approximately $1,908,000. The Company ​ performed a qualitative assessment to determine if it is more likely than not that the Company’s ​ fair value is less than its carrying amount. Based on its qualitative assessment, the Company ​ determined that goodwill was not impaired at December 31, 2015 and no further assessment was ​ required. ​ ​ ​ 5. CustomerMerchant Accounts ​ The net carrying value of customer merchant accounts is approximately $1,641,000 which consists ​ of approximately $2,593,000 of gross costs, net of accumulated amortization of approximately ​ $952,000 at December 31, 2015. Customer merchant accounts are being amortized over 66 months. ​ Total amortization expense of customer merchant accounts using the sum of the year’s digits is ​ included in depreciation and amortization in the accompanying consolidated statement of income ​ was approximately $152,000. ​ In 2015, the Company purchased approximately $1,525,000 of customer merchant accounts of ​ which approximately $1,515,000 was purchased from three separate related parties. The purchase ​ price was based on the present value of the merchant accounts future cash flows. These merchant ​ accounts are being amortized over 66 months. ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Consolidated Financial Statements ​ Year Ended December 31, 2015 ​ ​ 10 ​ Total expected amortization expense for the next five fiscal years and thereafter is as follows: ​ Year Ending December 31,​ 2016 566,393$ ​ 2017 442,921 ​ 2018 322,317 ​ 2019 203,943 ​ 2020 94,739 ​ Thereafter 10,275 ​ 1,640,588$ ​ ​ ​ ​ 6. Bank Note Payable ​ In 2015, the Company, CrystalTech Web Hosting, Inc. (“CrystalTech”) and Premier Payments ​ LLC (“Premier”), all subsidiaries of Holdco, collectively as “Borrowers” entered into a Credit and ​ Guarantee Agreement (the “Agreement”) with Goldman Sachs Bank USA which extended a multi ​ draw term loan facility (the “Facility”) up to an aggregate principal amount of $38,000,000. The ​ total outstanding balance under the Facility as of December 31, 2015 was $22,000,000. The ​ Borrowers are collectively liable for the outstanding balance under the Facility. All assets of the ​ Borrowers are pledged as collateral under the Agreement. The Facility provides for monthly ​ interest only payments with total principal due at maturity. The Facility matures in June 2019. ​ Borrowings under the facility are classified either as a “Base Rate Loan” or “LIBOR Rate Loan” at ​ the Company’s election. Each LIBOR Rate Loan shall bear interest on the outstanding balance at a ​ rate equal to (a) thegreater of LIBOR or 50 basis points plus (b) 7% and each Base Rate Loan shall ​ bear interest on the outstanding balance at a rate equal to (y) the greater of the Prime Rate or 350 ​ basis points, plus (z) 6%. The effective interest rate at December 31, 2015 was 7.5%. The ​ Company may make principal payments within 24 months of the closing date and pay a ​ prepayment premium based on a percentage of the principal outstanding as defined in the ​ Agreement. After 24 months, principal may be repaid under no penalty. The Agreement requires ​ certain restrictive covenants for which the Company is in compliance with as of December 31, ​ 2015. During the year ended December 31, 2015, the Company borrowed approximately ​ $16,999,000 of the $22,000,000 total borrowings under the Facility all of which is outstanding as ​ of December 31, 2015. Interest expense for the year ended December 31, 2015 was approximately ​ $680,000. ​ ​ Deferred financing costs incurred by the Company related to the Facility were $965,000. ​ Amortization of deferred financing costs for the year ended December 31, 2015 was approximately ​ $140,000 and included in interest expense on the consolidated income statement. Deferred ​ financing costs are amortized over the term of the Facility under the effective interest method. ​ ​ 7. Notes Receivable – Related Party ​ In June2015, the Company and CrystalTech entered into a revolving line of credit agreement with ​ Newtek Business Services Corp. (“Newtek”) and Holdco as borrowers. The line of credit bears ​ interest at a rate of 7.5% and matures in June 2019. Maximum borrowings under the line of credit ​ are $38,000,000. At December 31, 2015, net advances to Newtek and Holdco are approximately ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Consolidated Financial Statements ​ Year Ended December 31, 2015 ​ ​ 11 ​ $5,647,000. The Company recorded related interest income of approximately $484,000 during the ​ year ended December 31, 2015. ​ ​ 8. Related Party Transactions ​ The Company generated management fees of $11,000 each from Summit Systems, LLC ​ (“Summit”) and Business Connect, LLC (“Business Connect”), both affiliates of the Company. At ​ December 31, 2015, the total amount due from related parties was approximately $378,000. ​ The Company incurred residual expenses totaling approximately $1,971,000 from several related ​ parties. In addition, the Company incurred gateway fees of approximately $129,000 from Secure ​ Cyber Gateway Services, LLC, and breach insurance costs of approximately $270,000 from ​ Newtek Insurance Agency, LLC, which are included in electronic payment processing costs on the ​ consolidated statement of income. Salaries and overhead costs of approximately $352,000 and ​ $42,000 charged from Business Connect and CrystalTech, respectively, are included in salaries and ​ benefits. Payroll processing costs of approximately $15,000 from PMTWorks Payroll, LLC, ​ overhead expenses from Business Connect ofapproximately $53,000, and managed technology ​ services of approximately $15,000 from CrystalTech are included in other general and ​ administrative costs. At December 31, 2015 total amounts due to related parties are approximately ​ $265,000. ​ Included in salaries and benefits are charges from Newtek related to salaries for management and ​ certain other employees that perform services for the Company. Total amounts allocated to the ​ Company for the year ended December 31, 2015 were approximately $590,000. ​ In 2015, the Company purchased approximately $1,515,000 of customer merchant accounts from ​ three related parties. See Note 5. ​ In June 2015, the Company and CrystalTech provided Newtek and Holdco with a revolving line of ​ credit facility. See Note 7. ​ ​ The Company’s parent, Holdco, and Newtek are both guarantors of the Facility with Goldman ​ Sachs Bank USA. ​ ​ ​ 9. Commitments and Contingencies ​ Operating Commitments ​ The Company entered into noncancellable operating leases for office facilities with future rentals ​ as follows: ​ Year Ending December 31,​ 2016 176,917$ ​ 2017 181,067 ​ 357,984$ ​ ​ ​ ​ Universal Processing Services of Wisconsin, LLC and Subsidiary ​ Notes to Consolidated Financial Statements ​ Year Ended December 31, 2015 ​ ​ 12 ​ Total rent expense for the year ended December 31, 2015 was approximately $161,000. ​ ​ Under the amended terms of a Service Agreement and amended terms of Merchant Program ​ Processing Agreement, UPS-WI is required to pay minimum fees of $1,000,000 in total under these ​ agreements during each processing year. The Company’s fee payments for the 12-month period ​ ended December 31, 2015, exceeded the minimum required amount under these agreements. The ​ term of the service agreement was extended to March 2016. The Merchant Program Processing ​ Agreement initial term ends December 2015 and renews automatically each year. ​ Under the terms of an Independent Sales Organization Agreement and Member Services Provider ​ Agreement between UPS and one of their sponsoring banks, UPS-WI is required to pay monthly ​ minimum fees of $10,000 during the term of the agreement. The Company exceeded the monthly ​ minimum required amount under the agreement for the year ended December 31, 2015. The ​ agreement renews automatically annually. ​ Under the amended terms of a Processing Services Agreement between UPS-WI and one oftheir ​ front-end processors, UPS-WI is required to pay a quarterly minimum of $68,000 during the term ​ of the amended agreement. The Company’s fee payments for the 12-month period ended December ​ 31, 2015, exceeded the minimum required amount under these agreements. The agreement expires ​ July 2016. ​ ​ Litigation ​ In 2013, the Federal Trade Commission (the “FTC”) amended an existing complaint in the matter ​ Federal Trade Commission v. WV Universal Management, LLC et al., pending in the United States ​ District Court for the Middle District of Florida (the “Court”), to add UPS-WI, as an additional ​ defendant on one count of providing substantial assistance in violation of the Telemarketing Sales ​ Rule. On November 18, 2014, the Court issued an Order granting the FTC’s motion for summary ​ judgment against UPS-WI on the single count. Subsequently, the FTC filed motions for a ​ permanent injunction and equitable monetary relief against UPS-WI and the other remaining ​ defendants. Prior to the Court hearing on the motions, UPS-WI and the FTC reached a settlement ​ on the FTC’s motion for a permanent injunction. The Court granted the FTC’s motion for ​ equitable relief against UPS-WI and the other remaining defendants, ordering that the remaining ​ defendants pay approximately $1,735,000 in equitable monetary relief. This amount has been ​ deposited with the Courtpending the outcome of an appeal of the judgement. ​ In January 2014, NCMIC Finance Corporation (“NCMIC”) filed a complaint against the Company ​ in the United States District Court for the Southern District of Iowa. The complaint asserts claims ​ against the Company for breach of the UPS-WI and NCMIC agreement for the processing of credit ​ card transactions, and seeks monetary relief. The Company believes that the claims asserted in the ​ complaint are wholly without merit and intends to vigorously defend the action. Trial is currently ​ set for March 2016. The Company does not expect this matter to have a material impact on its ​ operations. ​ In October 2015, the Company filed an action against NCMIC and NCMIC related entities seeking, ​ among other things, indemnification in connection with the claims asserted by NCMIC against the ​ Company, as well as for monetary damages for breach of contract and fraud. ​ ​ 

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