Business Description
We are an asset management firm offering yield solutions to retail and institutional
investors. We focus on credit-related investment strategies, primarily originating
senior secured loans to private middle market companies in the United States
that have revenues between $50 million and $1 billion. We generally hold these
loans to maturity. Our national direct origination franchise, provides capital
to the middle market in the U.S.
We manage two permanent capital vehicles, both of which are BDCs, as well as
long-dated private funds and SMAs. Our focus on senior secured credit, combined
with the permanent and long-dated nature of our vehicles, generally leads to
predictable management fee and incentive fee income.
We provide our credit-focused investment strategies through various funds and
products that meet the needs of a wide range of retail and institutional investors.
Our permanent capital vehicles, MCC and SIC offer investors compelling risk-adjusted
yield opportunities. Given their permanent capital nature and focus on senior
credit, they provide a high degree of fee income visibility. Additionally, we
have a strong institutional investor base for our long-dated private funds and
separately managed accounts, which have been an important source of diversified
capital for our business.
Except as otherwise described herein with respect to our BDCs, our investment
funds themselves do not register as investment companies under the Investment
Company Act of 1940, as amended (the “Investment Company Act”),
in reliance on Section 3(c)(1), Section 3(c)(7) or Section 7(d) thereof. Section
3(c)(7) of the Investment Company Act exempts from the Investment Company Act’s
registration requirements investment funds privately placed in the United States
whose securities are owned exclusively by persons who, at the time of acquisition
of such securities, are “qualified purchasers” as defined under
the Investment Company Act. Section 3(c)(1) of the Investment Company Act exempts
from the Investment Company Act’s registration requirements privately
placed investment funds whose securities are beneficially owned by not more
than 100 persons. In addition, under certain current interpretations of the
SEC, Section 7(d) of the Investment Company Act exempts from registration any
non-U.S. investment fund all of whose outstanding securities are beneficially
owned either by non-U.S. residents or by U.S. residents that are qualified purchasers
and purchase their interests in a private placement. Certain subsidiaries of
Medley LLC typically serve as an investment adviser for our funds and are registered
under the Advisors Act. Our funds’ investment advisers or one of their
affiliates are entitled to management fees, performance fees and/or incentive
fees from each investment fund to which they serve as investment advisers.
We launched MOF I, our first long-dated private fund, in 2006, MOF II, our
second long-dated private fund, in 2010 and MOF III, our third long-dated private
fund, in 2014. Our long-dated private funds are managed through partnership
structures, in which limited partnerships organized by us accept commitments
or funds for investment from institutional investors and high net worth individuals,
and a general partner makes all policy and investment decisions, including selection
of investment advisers. Affiliates of Medley LLC serve as investment advisers
to our long-dated private funds. The limited partners of our long-dated private
funds take no part in the conduct or control of the business of such funds,
have no right or authority to act for or bind such funds and have no influence
or the voting or disposition of the securities or assets held by such funds,
although limited partners often have the right to remove the general partner
or cause an early liquidation by super-majority vote. As our long-dated private
funds are closed-ended, once an investor makes an investment, the investor is
generally not able to withdraw or redeem its interest, except in very limited
circumstances.
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