Good afternoon, ladies and gentlemen. And welcome to the KCAP Financial Inc Conference Call. An earnings press release was distributed today. If you did not receive a copy, the release is available on the Company's Web site, at www.kcapfinancial.com, in the Investor Relations section. As a reminder, this conference call is being recorded today, Tuesday, November 7, 2017. This call is also being hosted on a live webcast, which can be accessed at our Company's Web site, at www.kcapfinancial.com, in the Investor Relations section under Events. Today's conference call includes forward-looking statements and projections, and we ask that you refer to KCAP Financial's most recent filings with the SEC for important factors that will cause actual results to differ materially from these projections. KCAP Financial does not undertake to update its forward-looking statements unless required by law. I would now like to introduce your host for today's conference, Mr. Dayl Pearson, President and Chief Executive Officer of KCAP Financial. Mr. Pearson, you may begin.

Thank you and good afternoon. And thank you all for joining today's call. Today, as I usually do on earnings calls, I will review some of the highlights from the quarter and provide context for our direct lending business and performance of our asset manager affiliates. Our Chief Financial Officer, Ted Gilpin, will provide a more thorough review of the quarterly results and then we will open the line for your questions. Before we get into the discussion of our results, we thought it would be inappropriate time to provide some lighter context about where we see our business heading and the initiatives we have underway to get us there. The overall objective of these initiatives is to extend and increase our AUM, reduce the leverage and expand our borrowing capacity. By prudently redeploying the capital made available, we expect to see continuous improvements in our key financial metrics over the coming quarters and increase cash flow, which will fund distributions to our shareholders. Let me take you through the key initiatives starting with an update on the joint venture with Freedom 3 opportunities and the related redemption of $147 million of debt that we announced last quarter. With the improved balance sheet flexibility that this provided, we have been able to make a number of attractive investments to generate incremental free cash flow. As of the end of the third quarter, we have invested approximately $7 million of these funds, primarily in core assets with approximately 25% in non-core placeholder assets. You will also recall that there as part of this transaction, we set up a new fund owned by the JV, called KCAP F3C Senior Funding LLC, which is managed by a wholly owned asset manager affiliate of KCAP. This fund is on track to shortly be fully…

Thank you, Dayl. Good afternoon, everyone. As of September 30, 2017, net asset value stood at $4.95, down from the $5.10 at the end of the second quarter of 2017. This is due primarily to the onetime loss of $4 million, which is associated with the calling of $147 million in debt. The Company declared $0.12 distribution in the third quarter of 2017 consistent with second quarter of 2017. Net investment income was $2.5 million or $0.07 per basic share for the third quarter of 2017 consistent with $2.6 million or $0.07 per basic share in the second quarter of 2017. Interest income on our debt securities for the quarter ended September 30, 2017 was $2.5 million compared with $4.8 million from the second quarter of 2017, primarily due to removal of the $184 million of assets in conjunction with the formation of the joint venture. Our debt securities portfolio contribution to total investment income for the quarter was 39%, which compares to approximately 62% in the second quarter of 2017. Investment income from CLO fund securities remained flat at $2.8 million in the third quarter of 2017, about the same as $2.8 million reported in the second quarter 2017. We received distributions from our asset management affiliates totaling $880,000 in the third quarter of 2017. $180,000 of this distribution was a dividend income and $700,000 is in excess of the AMA's estimated taxable earnings and profits and is therefore treated as return of capital. AMA's distributed $650,000 in the second quarter of 2017, all of which was return of capital. For the three months ended September 30, 2017, total expenses decreased by approximately $1.3 million in the second quarter of 2017, primarily attributable to lower interest expense due to the redemption of KCAP’s Senior Funding liabilities and lower professional fees. The Company reported net realized and unrealized gains on investments of approximately $816,000 for the three months ended September 30, 2017 compared with net realized and unrealized gains of approximately $20,000 for the three months ended June 30, 2017. On the liability side of our balance sheet, as of September 30, 2017, par value of our debt outstanding was $104 million, consisting entirely of publicly issued debt, $77 million of which was issued in the third quarter and which will mature in five years. Our asset coverage ratio at quarter’s end was 274%, well above the minimum required 200% for BDCs. For additional information regarding the metrics for the third quarter of 2017, please refer to our earnings release and our recently filed 10-Q. All of our filings are available online at the SEC, at sec.gov, or on our Web site, kcapfinancial.com. Dayl?

Thank you, Ted. I just want to finish by talking about again the confident -- that our JV transaction together with the multiple CLO reset and upside transactions and our ability to prudently invest and use up liquidity, will enhance the Company’s financial position. We have a long track record of success, both in the middle market and broadly syndicated loans space, probably on a highly selective and diversified asset accumulation strategy. And we’re excited that our plans to grow AUM are coming to fruition. This was a quarter of significant amount of transition. And so it's going to take a while for all these initiatives to yield the final results. And we look forward to providing updates as we reach the strategic milestones that we’ve discussed today. Now, I’ll turn the call over to the operator for any questions. Operator?

Thank you [Operator Instructions]. I am not showing any questions at this time. So I’ll turn the call back over to Dayl Pearson.

Thank you -- somebody just…

I apologies, yes, so we did have Troy Ward with Ares Management did pop-up. You can go ahead your line is open.

Dayl, could you just remind us the impact of rising LIBOR that has on your CLO business and how that provides benefits and headwinds to both valuation and your future CLO income?

I mean, we have some short-term impact, most of which is in the past because the LIBOR is exceeded the 75 basis point to 1% floors in mostly broadly syndicated loans a while back. So really hasn’t impacted -- should not impact any more going forward, except somewhat in a positive like, because obviously our equity is not a floating rate note. So the residual impact is a slight positive to the CLOs. The other point to make is that in the reset transactions, we are significantly reducing the cost of the liabilities. In the most recent transaction, I think it was about 25 basis points lower roughly, overall, so that that’s going to make up for quite a bit. And the future transactions, we think we’ll even do better than that in terms of reducing liability costs. So that should offset any issues we had. But again, most of that’s in the [hidings] now for about two quarters.

And you may have said this, but I apologies, I missed it. Can you just remind me how many of the reset transactions that you feel like you have in the near-term and what does that near-term look like? I mean, are we talking months, quarters? And when do you expect some of these to get done?

We would like to get one or two more done before the end of this year. We think we’re on track to do that. And then we have some other plans for 2018, both in terms of resets and perhaps refinancing older funds that gone pass the reinvestment period.

And then the final question. Can you just outline your thought process of your current income stream relative to your current dividend payment?

I think, as I said the last couple of quarters have been a significant transition period. And I think the Board reassesses the dividend on a quarterly basis. And we’ll certainly do that again in our December board meeting. But we try to look out in terms of where we think we’re going to be down the road in terms of cash flow. And so it’s something that constantly is being rethought, but that’s where we are at the moment.

And while we didn’t put a number on it, the JV and taking to debt off the balance sheet raising new debt and deploying that in our core portfolio will all be accretive to earnings. So you just start seeing the pickup on that over the next several quarters.

But we still have $60 million of liquidity, and we may have some lower liquidity in the future. So we’re not going to throw that all out in the market at one. So we’re going to be very prudent as we’ve always been in terms of making new investments. So I think you need to see the glide path as we get to the next few quarters.

Since the last board meeting, I would assume there hasn’t been any negative trends to your expected future cash flows when the Board decided to keep the dividend steady. So if we assume that there is no negative trends to future cash flows, would we assume that potentially the Board is going to come to the same decision in December?

Well, that’s one of the things that Board considers. The Board also looks at the stock and where it's trading and whether or not it may be prudent to change the dividend, one way or the other. But right now, I think the dividend is $0.12. So I am one of seven members of the Board, so I am not going to speak for the other six in terms of where we’re going to be in December. But the Board looks at a lot of different things and a lot of the future cash flows and that’s obviously important. And nothing has changed since September when we announced the dividend.

And I'm not showing any further questions.

Okay, thank you very much. And it’ll be a while before we talk to you, because we’ll be at the -- for our [indiscernible], which will be in March. But look forward to having further discussion then and bringing up to date on where we stand on our strategic initiatives. Thank you.

Ladies and gentlemen, this does conclude the program and you may now disconnect. Everyone, have a great day.