SEC Company Response from PROSPECT CAPITAL CORP (PSEC, PSEC-PA) (CIK 0001287032) (PSEC) — Oct 23, 2018
PROSPECT CAPITAL CORP (PSEC, PSEC-PA) (CIK 0001287032)
Date: Oct. 23, 2018 · CIK: 0001287032 · Accession: 0001287032-18-000415
AI Filing Summary & Sentiment
File numbers found in text: 333-227124
Letter
VIA EDGAR United States Securities and Exchange Commission 100 F Street, N.E. Washington, D.C. 20549 RE: Registration Statement (333-227124) of Prospect Capital Corporation (the “Fund”)
Dear Messrs. Williamson and Ellington:
We are in receipt of oral comments provided by you on September 27, 2018 and September 26, 2018, respectively, regarding the Fund’s Registration Statement on Form N-2 (the “Registration Statement”).
The Fund has considered your comments and has authorized us to make on its behalf the responses and changes to the Registration Statement discussed below. These changes are reflected in Pre-Effective Amendment No. 1 (the “Amendment”) to the Registration Statement, which is being filed today.
The Fund’s responses to the comments are set forth below. For ease of reference, a summary of each comment is set forth in bold font and followed by the corresponding response. Terms that are capitalized but not defined herein shall have the same meaning assigned to them in the Amendment.
Accounting Comments:
1.
In the Fees and Expenses section, please round all dollar figures to the nearest dollar, as required by General Instruction 3 to Item 3 of Form N-2.
The Fund has revised the disclosure in accordance with the comment.
2.
In the Portfolio Companies table, please disclose the address of each portfolio company in which the Fund is investing, as required by Item 8.6.a.(1) of Form N-2.
The Fund has revised the disclosure in accordance with the comment.
3.
In footnote 1 to the Portfolio Companies table, please consider disclosing the percentage of total assets that are non-qualifying assets.
The Fund has revised the disclosure in accordance with the comment.
4.
In the Fund’s Consolidated Schedules of Investments, we note that the fair value of Credit Central Loan Company, LLC (“Credit Central”), Class A Units, increased by approximately 104% in the six-month period between June 30, 2017 and December 31, 2017. Please supplementally explain the rationale for such increase.
The fair value of the Class A units increased during the six months ending December 31, 2017 due to higher trading multiples of comparable companies in the consumer finance industry and an increase in Credit Central’s profitability, which was driven by lower levels of defaulted loans, for which management does not expect to receive payment, and provisions for loan losses.
5.
In the Fund’s Consolidated Schedules of Investments, we note that Valley Electric Company, Inc., Common Stock, had a fair value of zero as of September 30, 2017 and a fair value of approximately $12.6 million as of June 30, 2018. Please supplementally explain the rationale for such increase.
As also described on page 62 of the Registration Statement, in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section, the fair value increase was primarily the result of increased demand for specialty electrical services, which resulted in an increase in revenues, and higher project margins.
6.
In the Fund’s Consolidated Schedules of Investments, please ensure that all disclosure relating to restricted securities that is required by footnote 8 of Rule 12-12 of Regulation S-X, including acquisition date, is included in the Fund’s future financial statements.
The Fund will ensure that all such disclosure will be included, if applicable, going forward.
7.
In Note 4 (Revolving Credit Facility) to the Fund’s Consolidated Financial Statements, please disclose average dollar amount of borrowings and the average interest rate, as required by Rule 6-07.3 of Regulation S-X and ASC 946, Financial Services-Investment Companies, Subtopic 225.
The Fund will revise the disclosure in future financial statement filings in accordance with the comment.
8.
In Note 12 (Income Taxes) to the Fund’s Consolidated Financial Statements, please disclose in future filings the net unrealized appreciation or depreciation, as required by Rule 6-03(h)(2)(iii) of Regulation S-X.
The Fund will revise the disclosure in future financial statement filings in accordance with the comment.
9.
We note that a number of the Fund’s wholly-owned and substantially wholly-owned subsidiaries are not consolidated. Please supplementally explain the rationale as to why each such subsidiary is not consolidated.
In accordance with Regulation S-X and the AICPA Audit and Accounting Guide for Investment Companies and ASC 810-Consolidation, the Fund generally will not consolidate its interest in any company other than in investment company subsidiaries and controlled operating companies substantially all of whose business consists of providing services to the Fund. The Fund has reviewed the October 2014 IM Guidance Update, “Investment Company Consolidation,” and in reaching the foregoing conclusions the Fund took the guidance into account.
Arctic Energy Services, LLC (“AES”) provides oilfield service personnel, well testing flowback equipment, frac support systems and other services to exploration and development companies in the Rocky Mountains. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. AES is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
CCPI Inc. (“CCPI”) is a manufacturer of temperature measurement solutions and refractory materials for the aerospace, aluminum, automotive, heat treatment, steel, and other industries with operations in Blanchester, Ohio. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. CCPI is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
CP Energy Services Inc. (“CPES”) provides oilfield flowback services and fluid hauling and disposal services in Texas and Oklahoma through its subsidiaries. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. CPES is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
Credit Central Loan Company, LLC (“CCLC”) is a branch-based provider of installment loans with operations in South Carolina, Tennessee and Texas. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. CCLC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
Echelon Transportation LLC (“ETL”) is an aircraft leasing company with operations in New York, New York. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. ETL is also excluded from the definition of investment company under FASB ASC
946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
Edmentum Ultimate Holdings, LLC (“EUH”) owns 100% of the equity of Edmentum, Inc., which is an all subscription based software and service provider of online curriculum and assessments to the U.S. education market with operations in Minneapolis, Minnesota. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. EUH is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
First Tower Finance Company LLC (“FTFC”) owns 100% of First Tower, LLC, a multiline specialty finance company. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. FTFC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
Freedom Marine Solutions, LLC (“FMS”) owns, manages and operates offshore supply vessels that serve the oil and gas industry in the Gulf of Mexico. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. FMS is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
SB Forging Company II, Inc. (f/k/a Gulf Coast Machine & Supply Company) (“SBFC”) is a provider of value-added forging solutions to energy and industrial end markets with operations in Beaumont, Texas. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. SBFC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
Harbortouch Payments, LLC (“HPL”) is a provider of transaction processing services and point-of sale equipment used by merchants across the United States with operations in Allentown, Pennsylvania. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. HPL is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
InterDent, Inc. (“IDT”) is a dental practice support organization based in Inglewood, California providing administrative, operational, marketing and other services to affiliated dental practices. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. IDT is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
MITY, Inc. (“MITY”) is a designer, manufacturer and seller of multipurpose room furniture and specialty healthcare seating products with operations in Orem, Utah. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. MITY is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform
investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
National Property REIT Corp. (“NPRC”) is a qualified REIT that holds for investment, operates, finances, leases, manages, and sells a portfolio of real estate assets, including, but not limited to, industrial, commercial, and multi-family properties located in the Southeastern United States, Michigan and Texas, and engages in any and all other activities as may be necessary, incidental or convenient to carry out the foregoing. Additionally, through its wholly-owned subsidiaries, NPRC invests in online consumer loans. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. NPRC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
Nationwide Loan Company LLC (f/k/a Nationwide Acceptance LLC) (“NLC”) is an automobile and consumer loan finance company with operations in Cicero, Illinois. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. NLC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
NMMB, Inc. (“NMMB”) is an advertising media buying business with operations in New York, New York. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. NMMB is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
Pacific World Corporation (“PWC”) is a supplier of nail and beauty care products to food, drug, and value retail channels worldwide, and is based in Aliso Viejo, California. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. PWC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
R-V Industries, Inc. (“RVI”) is an engineering and manufacturing company servicing industrial customers with operations in Honey Brook, Pennsylvania. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. RVI is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
USES Corp. (“USES”) provides industrial, environmental, and maritime services in the Gulf States region and is based in Houston, Texas. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. USES is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
Valley Electric Company, Inc. (“VEC”) owns 100% of the equity of VE Company, Inc., which owns 100% of the equity of Valley Electric Co. of Mt. Vernon, Inc., a leading provider of specialty electrical
services in the state of Washington and among the top 50 electrical contractors in the United States. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. VEC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes.
Wolf Energy, LLC (“WEL”) owns and operates producing oil and gas assets in Texas. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. WEL is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services
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CORRESP 1 filename1.htm Document [Letterhead of Skadden, Arps, Slate, Meagher & Flom LLP] October 23, 2018 VIA EDGAR Jay Williamson, Attorney Adviser Kenneth Ellington, Staff Accountant United States Securities and Exchange Commission 100 F Street, N.E. Washington, D.C. 20549 RE: Registration Statement (333-227124) of Prospect Capital Corporation (the “Fund”) Dear Messrs. Williamson and Ellington: We are in receipt of oral comments provided by you on September 27, 2018 and September 26, 2018, respectively, regarding the Fund’s Registration Statement on Form N-2 (the “Registration Statement”). The Fund has considered your comments and has authorized us to make on its behalf the responses and changes to the Registration Statement discussed below. These changes are reflected in Pre-Effective Amendment No. 1 (the “Amendment”) to the Registration Statement, which is being filed today. The Fund’s responses to the comments are set forth below. For ease of reference, a summary of each comment is set forth in bold font and followed by the corresponding response. Terms that are capitalized but not defined herein shall have the same meaning assigned to them in the Amendment. Accounting Comments: 1. In the Fees and Expenses section, please round all dollar figures to the nearest dollar, as required by General Instruction 3 to Item 3 of Form N-2. The Fund has revised the disclosure in accordance with the comment. 2. In the Portfolio Companies table, please disclose the address of each portfolio company in which the Fund is investing, as required by Item 8.6.a.(1) of Form N-2. The Fund has revised the disclosure in accordance with the comment. 3. In footnote 1 to the Portfolio Companies table, please consider disclosing the percentage of total assets that are non-qualifying assets. The Fund has revised the disclosure in accordance with the comment. 4. In the Fund’s Consolidated Schedules of Investments, we note that the fair value of Credit Central Loan Company, LLC (“Credit Central”), Class A Units, increased by approximately 104% in the six-month period between June 30, 2017 and December 31, 2017. Please supplementally explain the rationale for such increase. The fair value of the Class A units increased during the six months ending December 31, 2017 due to higher trading multiples of comparable companies in the consumer finance industry and an increase in Credit Central’s profitability, which was driven by lower levels of defaulted loans, for which management does not expect to receive payment, and provisions for loan losses. 5. In the Fund’s Consolidated Schedules of Investments, we note that Valley Electric Company, Inc., Common Stock, had a fair value of zero as of September 30, 2017 and a fair value of approximately $12.6 million as of June 30, 2018. Please supplementally explain the rationale for such increase. As also described on page 62 of the Registration Statement, in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section, the fair value increase was primarily the result of increased demand for specialty electrical services, which resulted in an increase in revenues, and higher project margins. 6. In the Fund’s Consolidated Schedules of Investments, please ensure that all disclosure relating to restricted securities that is required by footnote 8 of Rule 12-12 of Regulation S-X, including acquisition date, is included in the Fund’s future financial statements. The Fund will ensure that all such disclosure will be included, if applicable, going forward. 7. In Note 4 (Revolving Credit Facility) to the Fund’s Consolidated Financial Statements, please disclose average dollar amount of borrowings and the average interest rate, as required by Rule 6-07.3 of Regulation S-X and ASC 946, Financial Services-Investment Companies, Subtopic 225. The Fund will revise the disclosure in future financial statement filings in accordance with the comment. 8. In Note 12 (Income Taxes) to the Fund’s Consolidated Financial Statements, please disclose in future filings the net unrealized appreciation or depreciation, as required by Rule 6-03(h)(2)(iii) of Regulation S-X. The Fund will revise the disclosure in future financial statement filings in accordance with the comment. 9. We note that a number of the Fund’s wholly-owned and substantially wholly-owned subsidiaries are not consolidated. Please supplementally explain the rationale as to why each such subsidiary is not consolidated. In accordance with Regulation S-X and the AICPA Audit and Accounting Guide for Investment Companies and ASC 810-Consolidation, the Fund generally will not consolidate its interest in any company other than in investment company subsidiaries and controlled operating companies substantially all of whose business consists of providing services to the Fund. The Fund has reviewed the October 2014 IM Guidance Update, “Investment Company Consolidation,” and in reaching the foregoing conclusions the Fund took the guidance into account. Arctic Energy Services, LLC (“AES”) provides oilfield service personnel, well testing flowback equipment, frac support systems and other services to exploration and development companies in the Rocky Mountains. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. AES is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. CCPI Inc. (“CCPI”) is a manufacturer of temperature measurement solutions and refractory materials for the aerospace, aluminum, automotive, heat treatment, steel, and other industries with operations in Blanchester, Ohio. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. CCPI is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. CP Energy Services Inc. (“CPES”) provides oilfield flowback services and fluid hauling and disposal services in Texas and Oklahoma through its subsidiaries. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. CPES is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. Credit Central Loan Company, LLC (“CCLC”) is a branch-based provider of installment loans with operations in South Carolina, Tennessee and Texas. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. CCLC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. Echelon Transportation LLC (“ETL”) is an aircraft leasing company with operations in New York, New York. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. ETL is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. Edmentum Ultimate Holdings, LLC (“EUH”) owns 100% of the equity of Edmentum, Inc., which is an all subscription based software and service provider of online curriculum and assessments to the U.S. education market with operations in Minneapolis, Minnesota. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. EUH is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. First Tower Finance Company LLC (“FTFC”) owns 100% of First Tower, LLC, a multiline specialty finance company. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. FTFC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. Freedom Marine Solutions, LLC (“FMS”) owns, manages and operates offshore supply vessels that serve the oil and gas industry in the Gulf of Mexico. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. FMS is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. SB Forging Company II, Inc. (f/k/a Gulf Coast Machine & Supply Company) (“SBFC”) is a provider of value-added forging solutions to energy and industrial end markets with operations in Beaumont, Texas. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. SBFC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. Harbortouch Payments, LLC (“HPL”) is a provider of transaction processing services and point-of sale equipment used by merchants across the United States with operations in Allentown, Pennsylvania. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. HPL is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. InterDent, Inc. (“IDT”) is a dental practice support organization based in Inglewood, California providing administrative, operational, marketing and other services to affiliated dental practices. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. IDT is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. MITY, Inc. (“MITY”) is a designer, manufacturer and seller of multipurpose room furniture and specialty healthcare seating products with operations in Orem, Utah. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. MITY is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. National Property REIT Corp. (“NPRC”) is a qualified REIT that holds for investment, operates, finances, leases, manages, and sells a portfolio of real estate assets, including, but not limited to, industrial, commercial, and multi-family properties located in the Southeastern United States, Michigan and Texas, and engages in any and all other activities as may be necessary, incidental or convenient to carry out the foregoing. Additionally, through its wholly-owned subsidiaries, NPRC invests in online consumer loans. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. NPRC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. Nationwide Loan Company LLC (f/k/a Nationwide Acceptance LLC) (“NLC”) is an automobile and consumer loan finance company with operations in Cicero, Illinois. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. NLC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. NMMB, Inc. (“NMMB”) is an advertising media buying business with operations in New York, New York. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. NMMB is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. Pacific World Corporation (“PWC”) is a supplier of nail and beauty care products to food, drug, and value retail channels worldwide, and is based in Aliso Viejo, California. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. PWC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. R-V Industries, Inc. (“RVI”) is an engineering and manufacturing company servicing industrial customers with operations in Honey Brook, Pennsylvania. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. RVI is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. USES Corp. (“USES”) provides industrial, environmental, and maritime services in the Gulf States region and is based in Houston, Texas. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. USES is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. Valley Electric Company, Inc. (“VEC”) owns 100% of the equity of VE Company, Inc., which owns 100% of the equity of Valley Electric Co. of Mt. Vernon, Inc., a leading provider of specialty electrical services in the state of Washington and among the top 50 electrical contractors in the United States. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. VEC is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services. Its principal business purpose and activities include making investments for strategic operating purposes. Wolf Energy, LLC (“WEL”) owns and operates producing oil and gas assets in Texas. Accordingly, it is excluded from the definition of investment company under Section 3(a) of the 1940 Act. WEL is also excluded from the definition of investment company under FASB ASC 946-10-15 because it does not perform investment management services