UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________________
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
May 8, 2014
GSV CAPITAL CORP.
(Exact name of registrant as specified in its charter)
| Maryland | 1-35156 | 27-4443543 |
| (State or other jurisdiction | (Commission File Number) | (I.R.S. Employer Identification No.) |
| of incorporation) |
2925 Woodside Road
Woodside, CA 94062
(Address of principal executive offices and zip code)
Registrant’s telephone number, including area code: (650) 235-4769
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition.
On May 8, 2014, the registrant issued a press release announcing its financial results for the fiscal quarter ended March 31, 2014. The text of the press release is included as Exhibit 99.1 to this Form 8-K.
The information disclosed under this Item 2.02, including Exhibit 99.1 hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be deemed incorporated by reference into any filing made under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
| (a) | Not applicable. |
| (b) | Not applicable. |
| (c) | Not applicable. |
| (d) | Exhibits. |
| Exhibit No. | Description | |
| 99.1 | Press release dated May 8, 2014 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: May 8, 2014 | GSV CAPITAL CORP. | |
| By: | /s/ Stephen D. Bard | |
| Stephen D. Bard | ||
| Chief Financial Officer, Chief Compliance | ||
| Officer, Treasurer and Corporate Secretary | ||
GSV Capital Corp. Reports First Quarter 2014 Results of Operations
Net Asset Value of $14.91 Per Share as of March 31, 2014;
Management Announces a $10 Million Buyback Program
WOODSIDE, Calif., May 8, 2014 (GLOBE NEWSWIRE) — GSV Capital Corp. ("GSV") (Nasdaq:GSVC), today announced financial results for the first quarter ended March 31, 2014.
"I'm pleased to report that despite a tumultuous period in the market for growth companies, our NAV was flat for the 1st Quarter ending March 31st, at $14.91 compared to $14.91 on December 31, 2013." said Michael Moe, GSV's founder and CEO. "While our largest position Twitter’s fair value declined $22.1 million for the quarter, it was offset by positive gains in positions such as Dropbox, Palantir, and 2U."
"Overall, the fundamentals of our portfolio are very strong with an estimated revenue growth of 95.6% year over year. Moreover, in the 1st Quarter we sold Facebook and Control4 shares, resulting in net realized gains of $7.9 million. Our fourth largest position 2U successfully completed an IPO on March 28, raising $104 million.
Given the material discount between the share price and NAV, GSV Capital's Board of Directors have authorized a share repurchase program of GSVC stock of up to $10 million over 12 months. Under the repurchase program, the Company may repurchase its outstanding common stock in the open market provided that the Company complies with the prohibitions under its Insider Trading polices and procedures and the guidelines specified in Rule 10-B-18 of the Securities Exchange Act of 1934.
GSV management anticipates liquidating its publicly held investments within one year of the expiration of the IPO lock-up.
As GSV’s portfolio matures and realizes a cumulative net gain, GSV intends to distribute a portion of such gains to shareholders in the form of a distribution.
Portfolio as of March 31, 2014
At March 31, 2014, the Company owns positions in 52 portfolio companies at an aggregate fair value of $368.0 million. Out of GSV’s 52 portfolio companies, the top 10 investments represented 80.5% of net asset value, and the top three investments represented 51.4% of net asset value.
GSV Capital Corp.
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Top Ten Investments at March 31, 2014
| $ in millions | Fair Value | % of Net Asset Value | ||||||
| Twitter, Inc. | $ | 80.7 | 28.0 | % | ||||
| Palantir Technologies, Inc. | 42.4 | 14.7 | ||||||
| Dropbox, Inc. | 25.1 | 8.7 | ||||||
| 2U, Inc. | 14.9 | 5.2 | ||||||
| Coursera, Inc. | 14.5 | 5.0 | ||||||
| Control4 Corporation | 12.3 | 4.3 | ||||||
| Solexel, Inc. | 11.0 | 3.8 | ||||||
| SugarCRM, Inc. | 10.5 | 3.7 | ||||||
| Avenues Global Holdings, LLC | 10.2 | 3.6 | ||||||
| JAMF Holdings | 10.0 | 3.5 | ||||||
| Total | $ | 231.6 | 80.5 | % | ||||
Net assets totaled $288.0 million or $14.91 per share at March 31, 2014, as compared to $14.91 per share at December 31, 2013, and $12.69 per share at March 31, 2013.
First Quarter 2014 Portfolio Investment Activity
During the first quarter of 2014, GSV invested $21.8 million. New portfolio companies include Lyft, Inc. (peer to peer ridesharing), and EdSurge, Inc. (education media platform) and General Assembly, Inc. (21st century educational bootcamp). GSV made additional investments in existing portfolio companies StormWind, LLC; NestGSV, Inc.; Dailybreak, Inc.; AlwaysOn, Inc.; Fullbridge, Inc.; and JAMF Holdings.
GSV sold 203,700 shares of Control4 Corporation and 150,000 shares of Facebook, Inc. during the first quarter of 2014 for net proceeds of $4.6 million and $9.5 million, respectively.
At March 31, 2014, GSV is invested in 44 private companies and the following 8 public companies: Twitter, 2U, Control4, Chegg, Violin Memory, Silver Spring Networks, Facebook and ePals. Subsequent to quarter end, GSV Capital has made additionoal investments, including leading a $10 million round in Declara.
First Quarter 2014 Financial Results
GSV recorded a net realized gain on investments of $7,931,745 or $0.41 per share during the three months ended March 31, 2014, compared to a net realized loss on investments of $(3,346,892), or $(0.17) per share, for the three months ended March 31, 2013. Net investment loss was $(2,794,814), or $(0.14) per share, for the first quarter of 2014, compared to a net investment loss of $(2,567,725), or $(0.13) per share, for the first quarter of 2013. For the three months ended March 31, 2014, GSV had a net change in unrealized depreciation on investments of $(3,073,679), or $(0.16) per share, an increase from the prior year period due primarily to decreases in the fair value of Twitter, Inc. and Facebook, Inc. Net increase in net assets resulting from operations was $79,704, or $0.00 per share, for the three months ended March 31, 2014. This compares to a net decrease in net assets resulting from operations of $(7,491,255), or $(0.39) per share, for the three months ended March 31, 2013. Weighted average common shares outstanding were 19.3 million for the three months ended March 31, 2014 and March 31, 2013, respectively.
GSV Capital Corp.
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Conference Call and Webcast; Live Twitter Updates
Management will hold a conference call and webcast with live tweeting for investors today at 2:00 p.m. PT (5:00 p.m. ET).
Conference Call
The conference call number for U.S. participants is (877) 941-1466 and the conference call number for participants outside the U.S. is (480) 629-9867. The conference ID number for both call numbers is 4681236.
Webcast
Interested parties can listen to a live webcast of the call from the “Investors” section of GSV Capital’s website at http://investors.gsvcap.com/events.cfm.
GSV Capital will also provide live updates via Twitter during the conference call. To access the tweets, follow GSV Capital on Twitter: @gsvcap
Replay
A replay of the conference call may be accessed through May 15, 2014 by dialing (800) 406-7325 (U.S.) or (303) 590-3030 (international), using conference ID number 4681236. An archived replay of the webcast will be available for 12 months following the live presentation.
About GSV Capital Corp.
GSV Capital Corp. (GSVC) is a publicly traded investment fund that seeks to invest in high-growth, venture-backed private companies. Led by industry veteran Michael Moe, the fund seeks to create a portfolio of high-growth emerging private companies via a repeatable and disciplined investment approach, as well as to provide investors with access to such companies through its publicly traded common stock. GSV Capital is headquartered in Woodside, CA. www.gsvcap.com
www.gsvcap.com
Follow GSV Capital on Twitter: @gsvcap
The GSV Capital Corp. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=12750
Forward-Looking Statements
Statements included herein may constitute "forward-looking statements," which relate to future events or our future performance or financial condition. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in our filings with the Securities and Exchange Commission. GSV Capital Corp. undertakes no duty to update any forward-looking statements made herein.
Contact
Financial Profiles, Inc.
Kristen Papke, (310) 622-8225
gsv@finprofiles.com
GSV Capital Corp.
Page 4 of 6
GSV CAPITAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
| March 31, 2014 | December 31, 2013 | |||||||
| ASSETS | ||||||||
| Investments at fair value: | ||||||||
| Investments in controlled securities (cost of $7,033,130 and $0, respectively) | $ | 8,012,556 | $ | - | ||||
| Investments in affiliated securities (cost of $63,818,718 and $64,912,527, respectively) | 60,038,914 | 62,740,162 | ||||||
| Investments in non-control/non-affiliated securities (cost of $224,585,818 and $214,796,591, respectively) | 299,972,346 | 292,643,491 | ||||||
| Investments owned and pledged (cost of $9,054,451 and $10,845,236, respectively) | 9,089,805 | 10,865,200 | ||||||
| Investments in United States Treasury Bill (cost of $80,000,584 and $0, respectively) | 79,999,900 | - | ||||||
| Total Investments (cost of $384,492,701 and $290,554,354, respectively) | 457,113,521 | 366,248,853 | ||||||
| Cash | 4,063,165 | 7,219,203 | ||||||
| Restricted cash | 22,139 | 22,264 | ||||||
| Deposit with Broker | 10,000,000 | - | ||||||
| Due from: | ||||||||
| GSV Asset Management(1) | - | 3,039 | ||||||
| Portfolio companies(1) | 140,804 | 153,178 | ||||||
| Interest receivable | 40,684 | 7,304 | ||||||
| Prepaid expenses | 128,909 | 49,739 | ||||||
| Coupon interest receivable | - | 11,141 | ||||||
| Dividend receivable | - | 13,233 | ||||||
| Deferred credit facility fees | 244,306 | 288,249 | ||||||
| Deferred debt issuance costs | 3,201,159 | 3,378,121 | ||||||
| Deferred offering costs | 228,285 | 184,710 | ||||||
| Other assets | 334,575 | 368,524 | ||||||
| Total Assets | 475,517,547 | 377,947,558 | ||||||
| LIABILITIES | ||||||||
| Due to: | ||||||||
| GSV Asset Management | 603,199 | 563,978 | ||||||
| Accounts payable | 333,474 | 382,165 | ||||||
| Accrued incentive fees | 11,493,204 | 10,523,552 | ||||||
| Accrued interest payable | 171,063 | 1,056,563 | ||||||
| Accrued expenses | 33,700 | - | ||||||
| Payable for securities purchased | 80,000,584 | - | ||||||
| Net deferred tax liability | 8,291,196 | 8,320,561 | ||||||
| Line of Credit | 18,000,000 | - | ||||||
| Convertible senior notes embedded derivative liability | 179,000 | 799,000 | ||||||
| Convertible senior notes payable 5.25% due September 15, 2018 | 68,365,979 | 68,335,295 | ||||||
| Total Liabilities | 187,471,399 | 89,981,114 | ||||||
| Commitments and contingencies (Note 6) | ||||||||
| Net Assets | $ | 288,046,148 | $ | 287,966,444 | ||||
| NET ASSETS | ||||||||
| Common stock, par value $0.01 per share | ||||||||
| (100,000,000 authorized; 19,320,100 issued and outstanding) | $ | 193,201 | $ | 193,201 | ||||
| Paid-in capital in excess of par | 275,837,514 | 275,837,514 | ||||||
| Accumulated net investment loss | (21,987,215 | ) | (19,192,401 | ) | ||||
| Accumulated net realized loss on investments | (8,967,092 | ) | (13,660,306 | ) | ||||
| Accumulated net unrealized appreciation (depreciation) on investments | 42,969,740 | 44,788,436 | ||||||
| Net Assets | $ | 288,046,148 | $ | 287,966,444 | ||||
| Net Asset Value Per Share | $ | 14.91 | $ | 14.91 | ||||
(1) This balance is a related party transaction. Refer to Note 2 for more detail.
GSV Capital Corp.
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GSV CAPITAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
| Three months ended March 31, 2014 | Three months ended March 31, 2013 | |||||||
| INVESTMENT INCOME | ||||||||
| Interest income from affiliated securities | $ | 39,928 | $ | - | ||||
| Dividend income from affiliated securities | 887 | - | ||||||
| Dividend income from non-control/non-affiliated securities | - | 4,535 | ||||||
| Total Investment Income | 40,815 | 4,535 | ||||||
| OPERATING EXPENSES | ||||||||
| Investment management fees | 1,756,196 | 1,283,599 | ||||||
| Accrued incentive fees | 969,652 | - | ||||||
| Costs incurred under administration agreement | 908,532 | 887,984 | ||||||
| Directors’ fees | 65,000 | 65,250 | ||||||
| Professional fees | 456,539 | 236,886 | ||||||
| Interest and credit facility expense | 1,179,725 | - | ||||||
| Insurance expense | 59,736 | 53,013 | ||||||
| Investor relations expense | 54,912 | 43,562 | ||||||
| Other expenses | 18,251 | 1,966 | ||||||
| Gain on fair value adjustment for embedded derivative | (620,000 | ) | - | |||||
| Total Operating Expenses | 4,848,543 | 2,572,260 | ||||||
| Benefit for taxes on net investment loss | 2,012,914 | - | ||||||
| Net Investment Loss | (2,794,814 | ) | (2,567,725 | ) | ||||
| Net Realized Gain (Loss) on Investments | 7,931,745 | (3,346,892 | ) | |||||
| Benefit / (Provision) for taxes on Net Realized Capital Gains / (Losses) | (3,238,531 | ) | - | |||||
| Net Change in Unrealized Depreciation on Investments | (3,073,679 | ) | (1,576,638 | ) | ||||
| Benefit for taxes on Unrealized Depreciation of investments | 1,254,983 | - | ||||||
| Net Increase (Decrease) in Net Assets Resulting From Operations | $ | 79,704 | $ | (7,491,255 | ) | |||
| Net Increase (Decrease) in Net Assets Resulting From Operations Per Common Share – basic and diluted | $ | 0.00 | $ | (0.38 | ) | |||
| Weighted Average Common Shares Outstanding: | 19,320,100 | 19,320,100 | ||||||
GSV Capital Corp.
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FINANCIAL HIGHLIGHTS
| Three months ended March 31, 2014 (Unaudited) | Three months ended March 31, 2013 (Unaudited) | |||||||
| Per Share Data: | ||||||||
| Net asset value at beginning of period | $ | 14.91 | $ | 13.07 | ||||
| Net investment loss | (0.14 | )(1) | (0.13 | )(1) | ||||
| Net realized gain (loss) | 0.41 | (1) | (0.17 | ) | ||||
| Benefit / (Provision) for taxes on Net Realized Capital Gains / (Losses) | (0.17 | )(1) | - | |||||
| Net change in unrealized appreciation (depreciation) | (0.16 | )(1) | (0.08 | )(1) | ||||
| Benefit for taxes on Unrealized Depreciation of investments | 0.06 | (1) | - | |||||
| Net asset value at end of period | $ | 14.91 | $ | 12.69 | ||||
(1) Based on weighted average number of shares outstanding for the year/period.