Good morning. Welcome to the Full Circle Capital Corporation Third Quarter Fiscal 2014 Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded May 9, 2014. I would now like to turn the conference over to Stephanie Prince. Please, go ahead, ma'am.

Thank you, Molly, and good morning, everyone. Thank you for joining us for Full Circle Capital Corp.'s third quarter of fiscal 2014 earnings conference call for the quarter ended March 31, 2014. With me this morning is John Stuart, Full Circle's Chairman and Co-Chief Executive Officer; Gregg Felton, President and Co-Chief Executive Officer; and Michael Sell, Chief Financial Officer. If you'd like to be added to the company's distribution list, please send an e-mail to info@fccapital.com. Alternatively, you can sign up under the Investor Relations tab on the company's website. The slide presentation accompanying this morning's conference call can also be found on Full Circle's website under the Investor Relations tab at fccapital.com. Before I turn the call over to management, I'd like to call your attention to the customary Safe Harbor statement regarding forward-looking information. Today's conference call includes forward-looking statements and projections, and we ask that you refer to Full Circle's most recent filings with the SEC for important factors that could cause actual results to differ materially from these projections. Full Circle does not undertake to update its forward-looking statement unless required by law. To obtain copies of the latest SEC filings, please visit Full Circle's website under the Investor Relations tab. I'd now like to turn the call over to John Stuart, Chairman and co-CEO of Full Circle Capital. John?

Thank you, Stephanie, and thank you, everyone, for joining us on the call this morning. Today, I'll begin our discussion with an overview of our strategy and results for the third quarter. Gregg will then review the portfolio activity and current portfolio composition, as well as provide color on Full Circle's forward opportunities. Finally, Mike will give a detailed discussion of the quarter's results. On Slide 3, accompanying the webcast, we provide an overview of our investment strategy. With Gregg joining us this past fall, we continue to build out our origination platform to include a broader set of investment opportunities while remaining within our overall credit parameters. While our focus remains on lower middle-market direct origination, we have begun to execute a more broad-based approach to our investment program to include secondary purchases to exploit market inefficiencies, such as the PEAKS and Esselte investments. We have also sought to participate in more club deals with our other lenders, whether through our direct origination efforts or through participating in more broadly syndicated facilities such as the recent Dynamic Energy and RCS Capital transactions. In certain cases, we are also structuring our credit investments with a greater degree of equity upside. Finally, we are continuing to build out our investment team at Full Circle Advisors to address industry verticals that we believe to be both attractive and scalable for the fund. On Slide 4, we provide some high-level details about our third quarter results. During the quarter, we recorded net investment income of $1.4 million or $0.15 per share, down from $1.9 million or $0.25 per share in the second quarter, which quarter included a higher fee income resulting from success fees from the iMedx realization. Interest income was also lower due to a lower level of investment as a result…

Thanks, John. As this third quarter is the first quarter that I have been with Full Circle since joining the company this past November, I'm pleased to report increased origination activity as we expand our avenues for asset production and sourcing. Much of this is evident in the transactions that we closed since the beginning of last quarter. As presented on Slides 5 and 6, we funded $24.5 million of investments in 5 new portfolio companies. And including 1 transaction that closed subsequent to quarter end, we have invested $29 million in new assets since January 1, the start of our third quarter. This is a significant increase in pace, and we certainly expect this to continue as we expand our investment team further. The first 2 deals, ACS and PEAKS, were outlined on our last call, so I'll provide only a brief update here. In the case of ACS, there was no change to our holdings, as our convertible notes remain undrawn. Our warrant valuation reflects the equity price increase over the quarter. Please note that the shares underlying our warrants remain unregistered. As for PEAKS, which we purchased for $0.805 of -- on the dollar, $0.805 of par, we received a significant prepayment in the form of an amortization payment equal to approximately 15% of our face amount. This contributed approximately $0.02 per share of realized gain in the quarter. Turning to Slide 6. You'll see that we funded a new investment in Ocean Protection Services Limited. OPS provides security services to the shipping industry. It's an example of a directly originated opportunity where we were able to fund the entire financing required to support an acquisition. We invested $7 million in a first lien senior secured credit facility bearing interest at LIBOR plus 12% with a LIBOR…

Thanks, Gregg. Please turn to Slide 9, which provides an overview of the third quarter financial highlights. For the third quarter of fiscal 2014, net investment income was $1.4 million or $0.15 per share compared to $1.3 million or $0.18 per share in the third quarter of last year. Net realized and unrealized gains were $2 million or $0.21 per share. Unrealized gains on investments were $1.8 million or $0.18 per share. And realized gains were $200,000 or $0.02 per share. Including the gains, we recorded a net increase in net assets resulting from operations of $3.4 million or $0.36 per share, which compares to a net increase of $1.5 million or $0.20 per share in the third fiscal quarter of 2013. The weighted average share count in the third quarter was 9.4 million shares compared to 7.6 million shares in the same period last year. This increase reflects the 2 common equity offerings that Full Circle completed in January and February of 2014. Net asset value per share was $7.20 at March 31, up from the $7.09 on December 31, 2013. Slide 10 digs a little deeper into the composition of the portfolio, highlighting the predominantly floating rate nature of our portfolio. We believe this positions us well for any possible rising rate environment in the future. Furthermore, the bulk of our portfolio continues to be invested in senior secured loans. Please turn to Slide 11, which highlights the important balance sheet items. On March 31, our total assets were approximately $112 million, which includes $10 million in short-term treasury bills. The investment portfolio at fair value totaled $90.1 million, slightly higher than the $88.1 million at March 31, 2013, and up significantly from $75.9 million at December 31. Total liabilities were approximately $39.2 million, which includes $21.1 million outstanding on our 8.25% notes that were issued last June. We had no outstanding borrowings on our $45 million line of credit at March 31. We expect to fund future investments from that availability, as Gregg mentioned in his remarks. I'll now turn the call back over to John.

Thank you, Gregg and Mike. We'd now like to open up the call for questions. Operator?

[Operator Instructions] Our first question is from Andrew Kerai with National Securities.

Just wanted to talk about sort of your outlook for growth here as 2014 moves along. Just given that you obviously have a significant amount of liquidity now, following the equity raises and the -- and having none drawn on your facility, how -- I guess, how can we expect portfolio growth to kind of trend throughout the remainder of the year, kind of, given that -- your outlook in terms of originations and prepayments as well?

So, Andrew, this is Gregg. Thanks for the question. I'll take that one. I'd say that it's interesting you started off talking a little bit about, I think, maybe the economy, perhaps, in terms of the macro. And I'd say that we feel, at our size and given our increase in origination, we're probably not particularly sensitive to the macro factors and much more focused on our own ability to increase our origination in the context of this market. Our pickup in origination activity last quarter was very, very good. We see, similarly, a nice pipeline of opportunity in the next quarter or 2. The activity or origination list that we have here is very, very robust. We always, of course, are challenged to predict the timetable of closing, but I'd tell you that we feel very optimistic with respect to the pipeline of opportunity and the ability to scale our book. I'd say that, that is absolutely true on a gross basis, and its even true on a net basis. We think that our net originations, i.e., the originations that we're talking about, net of repayments, will be quite -- up quite nicely. That's what we expect.

Great. That's certainly helpful color. And then, in terms of your cost of debt as well, too, have you had, I guess, discussions in terms of lowering -- in terms of kind of lowering your weighted average cost of debt? I mean, obviously, as you utilize the credit facility, that's going to sort of naturally draw that down. But, I mean, have you had sort of any discussions with your lenders in terms of kind of revisiting the rate on that line of credit as well?

I think you hit the nail on the head -- this is Mike -- when you referenced the drawing on our revolving line of credit's going to bring down our weighted average cost of debt capital. As you remember, likely, from the initial formation of the facility, we have a tiered pricing structure embedded inside of our credit facility that the less we borrow relative to our eligibility, the lower we pay. So I think, in terms of where that rate is going to go, I think that's already something that's embedded inside of our document. But obviously, the more we draw on that line of credit to fund future acquisitions, the lower our weighted average cost of debt capital is going to be.

Great. That certainly makes sense. And just a couple of things on Advanced Cannabis as well, too. It looks like, based on the fair value mark, you're assuming a share price a little under -- I think it's about $11.90. So, one, I mean, I guess, in terms of your outlook to being able to kind of monetize that in July, when the 6-month waiting period is over; and then, secondly, in terms of funding the first $7.5 million of that convert, what you're seeing in terms of the company being able to meet the milestones over the near term in terms of property acquisitions and the like to get that done?

Mike, do you want to take the first valuation part?

Yes, I'll start on valuation. I -- in terms of what we view the equity price as, I think, when we got down to the valuation process at quarter end -- and obviously, we used our third-party valuation agents, in conjunction with our own analyses here, what you see reflected on our scheduled investments is not necessarily a view towards what we expect the share price will be trading at when we have registered shares. It's more reflective of the fact that, at March 31, we held unregistered shares still in the company. We had a large position relative to where the volume was in the market. And quite frankly, over quarter end, there was a halt on the security that we addressed previously via press release. I think we had to factor in all of those when determining what the warrant itself would be worth at quarter end, rather than maybe extracting a forward value and putting that on top of where we see ACS trading in the future.

As it relates to your question about liquidity, we'd reiterate what we said earlier and what you know to be the case in terms of the liquidity around July, which is the expiry of a 6-month required 144A holding period, right? So we have -- that is still probably the way to think about it in the absence of insight into registration, which, again, we don't have any particular insight in the timing there of registration of underlying shares. There is a registration statement on file, which is public and you can see. As it relates to the funding of the notes, I think that is still, again, a -- something that we continue to evaluate. As you know, during the quarter, there was a new piece of information as it relates to the suspension of the stock, which is unfortunate. And that's something, of course, that we continue to work through with the company to see how to move forward. And we're evaluating that on a case-by-case basis.

[Operator Instructions] Our next question is from Mickey Schleien with Ladenburg. Mickey M. Schleien - Ladenburg Thalmann & Co. Inc., Research Division: You seem to be moving upmarket a little bit in terms of the deal flow. And we've generally heard from BDCs in general that terms are more difficult in that market, whether its leverage or spreads or the amount of covenant-light deal flow. So I'm curious as to how comfortable you are in -- at the upward level of the middle market in terms of potential for new deal flow, and then I have a follow-up question as well.

It's John speaking, Mickey. It's a good question. It is important to bear that out. As we said in the beginning in the prepared remarks, and if you look at the originations that were done in the quarter, we are still focused on our direct origination, sort of, small or lower middle-market, as we believe and continue to believe that there's good value there. We're slightly moving upmarket in that arena as well. And that continues to be a core area of focus for us, and you'll still see that in our book. However, with Gregg coming on, as we've said for the last 2 calls, we're broadening our exposures. And I think the Dynamic transaction, the RCS Capital transaction and Esselte were all a symptomatic effect. Correct, Gregg?

Yes. And I think that we probably should distinguish between the secondary opportunities and the primary opportunities for the following reason. I think the broad statement that you're, I think, getting at, Mickey, which is that the primary origination opportunity in the upper part of the middle market is not attractive, we absolutely agree with that. We think there's a lack of interesting opportunity in the more broadly syndicated part of the credit market. So for sure, we think that there will be few and far between opportunities for us to identify broadly syndicated deals. And we do, now, we perhaps didn't before, but today, we look at all of the broadly distributed deals that are coming to market. And so we have a real-time view of the characteristics of what's there. We think there's very little, if anything, that would be attractive to our shareholders. We did identify one such deal most recently that was even a second lien, which is unusual to find something in the market we find to be attractive. I'd encourage you to take a look at that deal, which I indicated is an almost $3 billion enterprise in the form of RCS, which we just think was mispriced in the second lien at that 950 basis point over LIBOR rate. We just think that was a mispriced piece of paper, and that's why we participated. But we think that's the exception rather than the rule. We are happy not to be participating in that market on a regular basis, but we certainly want to opportunistically look at what comes and see if there might be opportunities there that are appropriate for our investors. Mickey M. Schleien - Ladenburg Thalmann & Co. Inc., Research Division: Gregg, would you consider purchasing some either junior debt or equity tranches of CLOs along -- because that's a pretty fragmented, illiquid market where, sometimes, you can see disparities and opportunities, but it also requires a certain expertise and a lot of homework. Is that something you're looking at?

Well, I'll start by saying that I have participated in the CLO market actively in my career, and I don't think this is a particularly interesting time, from our perspective, to be looking at junior tranches of CLOs, whether it be debt or equity. I think that the -- consistent with what we're seeing in the large cap liquid market, CLO equity is priced, I think, very competitively. And I know that some of the other BDCs out there are pursuing that strategy. I don't know how actively today they are, but as you know, the rates can move around quite meaningfully. Today, we don’t think there's much of interest there, and we think there is much easier opportunity and more attractive opportunity in the traditional single-asset origination side. We are seeing, as I mentioned, a good pipeline of opportunity. We are able to get still-attractive double-digit rates of return on a secured basis. We do see the types of issuers that we want to make loans to. And so the good news is that our pipeline is pretty robust, and we're not finding ourselves having to look at structured credit or other areas. Mickey M. Schleien - Ladenburg Thalmann & Co. Inc., Research Division: Would you consider expanding your platform to get into the asset-based lending business? We've seen some BDCs do that, sort of as a complementary business to a cash flow lending business.

Yes. Mickey, it's John speaking. We have-- traditionally that's been our focus, to have an underlying amount of ABL beneath our exposures. That has been -- that's actually embedded in the loan facility from Santander that Mike mentioned a few minutes ago. It is a component of that loan facility. We have always been focused on that. However, I'd say we've shifted a little bit to take more cash flow exposure as we broaden our mandate. But we are keenly focused on ABL exposures. We're looking at a couple of things on expanding our ABL focus, however, not necessarily in the way that some of the other firms have done it in purchasing, effectively, finance companies. We think we can build that out here, as well as on-board some of those assets at the BDC rather than having a separate subsidiary. So, yes, we're looking at things like that. But as you know, we look at a lot of things, and it's part of our job to develop out these strategies. But we have had an ABL focus from day 1, as well as supplemented by cash flow exposures.

There are no further questions at this time. Please, proceed with your presentation or any closing remarks.

In closing, we thank you for attending the call this morning and the opportunity to address your questions. We look forward to speaking with you on our fiscal year end call in September. As you know, we have a June 30 year end. The next call will be approximately in early middle part of September, after the summer. Until then, do not hesitate. Please do not hesitate to call anyone of us, and we encourage that dialogue. Thank you very much.

Ladies and gentlemen, that concludes your conference call for today. We thank you for your participation and ask that you please disconnect your lines.