MassMutual
Corporate Investors
Report for the
Three Months Ended March 31, 2007
[LOGO]
ADVISER
Babson Capital Management LLC
1500 Main Street, P.O. Box 15189
Springfield, Massachusetts 01115-5189
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
KPMG LLP
Boston, Massachusetts 02110
COUNSEL TO THE TRUST
Ropes & Gray LLP
Boston, Massachusetts 02110
CUSTODIAN
Citibank, N.A.
New York, New York 10043
TRANSFER AGENT & REGISTRAR
Shareholder Financial Services, Inc.
P.O. Box 173673
Denver, Colorado 80217-3673
1-800-647-7374
INTERNET WEBSITE
www.babsoncapital.com/mci
[LOGO] MassMutual Corporate Investors
c/o Babson Capital Management LLC
1500 Main Street, Suite 600
Springfield, Massachusetts 01115
(413) 226-1516
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INVESTMENT OBJECTIVE AND POLICY
MassMutual Corporate Investors (the "Trust") is a closed-end management
investment company, first offered to the public in 1971, whose shares are traded
on the New York Stock Exchange under the trading symbol "MCI." The Trust's share
price can be found in the financial section of most newspapers as "MassCp" or
"MassMulnv" under the New York Stock Exchange listings.
The Trust's investment objective is to maintain a portfolio of securities
providing a fixed yield while providing an opportunity for capital gains. The
Trust's principal investments are privately placed, below-investment grade,
long-term corporate debt obligations with equity features such as warrants,
conversion rights, or other equity features and, occasionally, preferred stocks.
The Trust typically purchases these investments, which are not publicly
tradable, directly from their issuers, which tend to be smaller companies. In
addition, the Trust may temporarily invest, subject to certain limitations, in
marketable investment grade debt securities, other marketable debt securities
(including high yield securities) and marketable common stocks.
Babson Capital Management LLC ("Babson Capital") manages the Trust on a total
return basis. The Trust distributes substantially all of its net income to
shareholders each year. Accordingly, the Trust pays dividends to shareholders
quarterly in January, May, August, and November. The Trust pays dividends to its
shareholders in cash, unless the shareholder elects to participate in the
Dividend Reinvestment and Share Purchase Plan.
FORM N-Q
The Trust files its complete schedule of portfolio holdings with the U.S.
Securities and Exchange Commission ("SEC") for the first and third quarters of
each fiscal year on Form N-Q. This information is available (i) on the SEC's
website at http://www.sec.gov; and (ii) at the SEC's Public Reference Room in
Washington, DC (which information on their operation may be obtained by calling
1-800-SEC-0330). A complete schedule of portfolio holdings as of each
quarter-end is available upon request by calling, toll-free, 866-399-1516.
PROXY VOTING POLICIES & PROCEDURES; PROXY VOTING RECORD
The Trustees of the Trust have delegated proxy voting responsibilities relating
to the voting of securities held by the Trust to Babson Capital. A description
of Babson Capital's proxy voting policies and procedures is available (1)
without charge, upon request, by calling, toll-free 866-399-1516; (2) on the
Trust's website: http://www.babsoncapital.com/mci; and (3) on the SEC's website:
http://www.sec.gov. Information regarding how the Trust voted proxies relating
to portfolio securities during the most recent 12-month period ended June 30 is
available (1) on the Trust's website: http://www.babsoncapital.com/mci; and (2)
on the SEC's website: http://www.sec.gov.
MCI
Listed
NYSE
TO OUR SHAREHOLDERS
April 30, 2007
We are pleased to present the March 31, 2007 Quarterly Report of MassMutual
Corporate Investors (the "Trust"). At the Trust's Annual Shareholders Meeting,
which was held on April 27, 2007, shareholders elected Donald E. Benson, Donald
Glickman, and Robert E. Joyal as Trustees, each for a three-year term; William
J. Barrett as Trustee, for a two-year term; and Michael H. Brown as Trustee, for
a one-year term.
The Board of Trustees declared a quarterly dividend of 52 cents per share,
payable on May 18, 2007 to shareholders of record on May 7, 2007. The Trust had
previously paid a 50 cent per share dividend for the preceding quarter (plus a
special year-end dividend of 50 cents per share).
U.S. equity markets, as measured by several broad market indices, posted mixed
returns for the quarter. Large stocks, as approximated by the Dow Jones
Industrial Average, decreased 0.33%. Smaller stocks, as approximated by the
Russell 2000 Index, increased 1.95%. U.S. fixed income markets, as measured by
several broad market indices increased during the quarter. The Lehman Brothers
Government/Credit Index increased 1.47% for the quarter and the Lehman Brothers
U.S. Corporate High Yield Index increased 2.64% for the quarter.
During the quarter ended March 31, 2007, net assets of the Trust increased to
$257,999,523 or $28.10 per share compared to $251,689,646 or $27.51 per share on
December 31, 2006, which translates into a 2.14% return for the quarter, based
on the change in the Trust's net assets assuming the reinvestment of all
dividends. Long term, the Trust returned 14.43%, 17.14%, 14.86%, and 15.94% for
the 1-, 5-, 10- and 25-year time periods, respectively, based on the change in
the Trust's net assets assuming the reinvestment of all dividends. The Trust
earned 53 cents per share of net investment income for the quarter, compared to
81 cents per share in the previous quarter, of which 24 cents per share was from
nonrecurring items.
During the quarter, the Trust made private placement investments in five new
issuers totaling approximately $10 million. The five new issuers the Trust
invested in were Aero Holdings, Inc., Connecticut Electric, Inc., Hawk Precision
Components Group, Inc., K W P I Holdings Corporation and Total Equipment &
Service, Inc. The weighted average coupon of these investments was 11.88%. (A
brief description of these investments can be found in the Consolidated Schedule
of Investments.)
The market price per share of the Trust as of March 31, 2007 was $36.35, which
equates to a 29.4% premium over the March 31, 2007 NAV per share. The Trust's
average quarter-end premium for the 3, 5 and 10-year periods was 14.2%, 10.6%
and 4.7%, respectively.
Thank you for your continued interest in and support of MassMutual Corporate
Investors.
Sincerely,
/s/ Clifford M. Noreen
Clifford M. Noreen
President
[PIE CHART APPEARS HERE]
Portfolio Composition as of 03/31/07*
Private High
Public Equity 1.0% Yield Debt 51.5%
Public High Cash & Short Term
Yield Debt 24.6% Investments 2.1%
Private/Restricted Private Investment
Equity 16.5% Grade Debt 4.3%
*Based on market value of total investments
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1
CONSOLIDATED STATEMENT OF MASSMUTUAL CORPORATE INVESTORS
ASSETS AND LIABILITIES
March 31, 2007
(Unaudited)
ASSETS:
Investments
(See Consolidated Schedule of Investments)
Corporate restricted securities at fair value
(Cost - $197,007,348) $ 198,234,210
Corporate public securities at market value
(Cost - $67,253,983) 70,081,375
Short-term securities at amortized cost 5,185,429
--------------
273,501,014
Cash 599,794
Interest and dividends receivable 5,814,144
Receivable for investments sold 31,684
Other assets 19,014
--------------
TOTAL ASSETS $ 279,965,650
==============
LIABILITIES:
Payable for investments purchased $ 200,000
Investment advisory fee payable 806,249
Note payable 20,000,000
Interest payable 188,856
Accrued expenses 119,430
Accrued taxes payable 651,592
--------------
TOTAL LIABILITIES 21,966,127
--------------
TOTAL NET ASSETS $ 257,999,523
--------------
NET ASSETS:
Common shares, par value $1.00 per share; an unlimited number authorized 9,181,437
Additional paid-in capital 109,231,705
Retained net realized gain on investments, prior years 126,906,684
Undistributed net investment income 6,627,901
Accumulated net realized gain on investments 2,429,086
Net unrealized appreciation of investments 3,622,710
--------------
TOTAL NET ASSETS $ 257,999,523
==============
COMMON SHARES ISSUED AND OUTSTANDING 9,181,437
==============
NET ASSET VALUE PER SHARE $ 28.10
==============
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
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2
CONSOLIDATED STATEMENT OF OPERATIONS MASSMUTUAL CORPORATE INVESTORS
For the three months ended March 31, 2007
(Unaudited)
INVESTMENT INCOME:
Interest $ 6,086,759
Dividends 139,007
Other 2,683
--------------
TOTAL INVESTMENT INCOME 6,228,449
--------------
EXPENSES:
Investment advisory fees 806,249
Interest 378,747
Trustees' fees and expenses 45,000
Professional fees 31,500
Reports to shareholders 27,000
Transfer agent/registrar's expenses 9,000
Other 101,954
--------------
TOTAL EXPENSES 1,399,450
--------------
INVESTMENT INCOME - NET 4,828,999
--------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments 2,337,748
Net change in unrealized appreciation of investments (2,130,297)
Net change in deferred income tax expense 219,474
--------------
Net change in unrealized appreciation of investments (1,910,823)
NET GAIN ON INVESTMENTS 426,925
--------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 5,255,924
==============
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
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3
CONSOLIDATED STATEMENT OF CASH FLOWS MASSMUTUAL CORPORATE INVESTORS
For the three months ended March 31, 2007
(Unaudited)
NET DECREASE IN CASH:
Cash flows from operating activities:
Interest, dividends, and other received $ 6,220,977
Interest expense paid (378,747)
Operating expenses paid (1,028,520)
Income taxes paid (6,315,954)
--------------
NET CASH USED FOR OPERATING ACTIVITIES (1,502,244)
--------------
Cash flows from investing activities:
Purchases/Proceeds/Maturities from short-term portfolio securities, net 2,078,948
Purchase of portfolio securities (25,838,258)
Proceeds from disposition of portfolio securities 28,772,846
--------------
NET CASH PROVIDED BY INVESTING ACTIVITIES 5,013,536
--------------
NET CASH PROVIDED BY OPERATING AND INVESTING ACTIVITIES 3,511,292
--------------
Cash flows from financing activities:
Cash dividends paid from net investment income (7,703,279)
Cash dividends paid from net realized gain on investments (1,446,640)
Receipts for shares issued on reinvestment of dividends 1,053,953
--------------
NET CASH USED FOR FINANCING ACTIVITIES (8,095,966)
--------------
NET DECREASE IN CASH (4,584,674)
Cash - beginning of year 5,184,468
--------------
CASH - END OF PERIOD $ 599,794
==============
RECONCILIATION OF NET INCREASE IN NET ASSETS TO NET
CASH PROVIDED BY OPERATING AND INVESTING ACTIVITIES:
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 5,255,924
--------------
Decrease in investments 3,846,938
Decrease in interest and dividends receivable 320,521
Decrease in receivable for investments sold 469,179
Increase in other assets (19,014)
Increase in payable for investments purchased 200,000
Increase in investment advisory fee payable 19,719
Decrease in accrued expenses (46,547)
Decrease in accrued taxes payable (6,535,428)
--------------
TOTAL ADJUSTMENTS TO NET ASSETS FROM OPERATIONS (1,744,632)
--------------
NET CASH PROVIDED BY OPERATING AND INVESTING ACTIVITIES $ 3,511,292
==============
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
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4
CONSOLIDATED STATEMENTS OF MASSMUTUAL CORPORATE INVESTORS
CHANGES IN NET ASSETS
For the three
months ended For the
03/31/2007 year ended
(Unaudited) 12/31/2006
-------------- --------------
INCREASE IN NET ASSETS:
OPERATIONS:
Investment income - net $ 4,828,999 $ 20,681,143
Net realized gain on investments 2,337,748 12,301,691
Net change in unrealized appreciation of investments (1,910,823) 2,456,052
-------------- --------------
Net increase in net assets resulting from operations 5,255,924 35,438,886
Increase from common shares issued on reinvestment of dividends
Common shares issued (2007 - 31,518; 2006 - 84,966) 1,053,953 2,619,000
Dividends to shareholders from:
Net investment income (2006 - $2.47 per share) -- (22,518,167)
Net realized gains on investments (2006 - $0.01 per share) -- (125,491)
-------------- --------------
Total increase in net assets 6,309,877 15,414,228
Net assets, beginning of year 251,689,646 236,275,418
-------------- --------------
Net assets, end of period/year (including undistributed net investment
income of $6,627,901 and $1,798,902, respectively) $ 257,999,523 $ 251,689,646
============== ==============
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
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5
CONSOLIDATED SELECTED FINANCIAL HIGHLIGHTS MASSMUTUAL CORPORATE INVESTORS
Selected data for each common share outstanding:
For the three
months ended For the years ended December 31,
03/31/2007 ----------------------------------------------------------------------
(Unaudited) 2006 2005 2004 2003 2002
---------- ---------- ---------- ---------- ---------- ----------
Net asset value
Beginning of year $ 27.51 $ 26.06 $ 24.34 $ 21.84 $ 19.40 $ 20.07
---------- ---------- ---------- ---------- ---------- ----------
Net investment income (a) 0.53 2.27 2.03 2.00 1.44 1.53
Net realized and unrealized
gain (loss) on investments 0.05 1.62 1.96(b) 2.64 2.83 (0.59)
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations 0.58 3.89 3.99 4.64 4.27 0.94
---------- ---------- ---------- ---------- ---------- ----------
Dividends from net investment
income to common shareholders -- (2.47) (2.11) (2.16) (1.84) (1.44)
Dividends from net realized gain on
investments to common shareholders -- (0.01) (0.18) -- -- (0.18)
Increase from dividends reinvested 0.01 0.04 0.02 0.02 0.01 0.01
---------- ---------- ---------- ---------- ---------- ----------
Total dividends 0.01 (2.44) (2.27) (2.14) (1.83) (1.61)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value:
End of period/year $ 28.10 $ 27.51 $ 26.06 $ 24.34 $ 21.84 $ 19.40
---------- ---------- ---------- ---------- ---------- ----------
Per share market value:
End of period/year $ 36.35 $ 34.89 $ 30.05 $ 28.50 $ 22.90 $ 19.49
========== ========== ========== ========== ========== ==========
Total investment return
Market value 4.18% 29.04% 16.95% 36.10% 27.53% 1.35%
Net asset value (c) 2.14% 18.09% 20.04% 22.76% 22.61% 4.80%
Net assets (in millions):
End of period/year $ 258.00 $ 251.69 $ 236.28 $ 218.51 $ 193.79 $ 171.03
Ratio of operating expenses
to average net assets 1.62%(d) 1.43% 1.78% 1.93% 2.04% 1.82%
Ratio of interest expense
to average net assets 0.60%(d) 0.60% 0.73% 0.77% 0.82% 0.86%
Ratio of total expenses before custodian
reduction to average net assets 2.22%(d) 2.07% 2.52% 2.70% 2.86% 2.68%
Ratio of net expenses after custodian
reduction to average net assets 2.22%(d) 2.03% 2.51% 2.70% 2.86% 2.68%
Ratio of net investment income
to average net assets 7.66%(d) 8.19% 7.98% 8.68% 6.95% 7.65%
Portfolio turnover 9.69% 34.70% 35.22% 53.45% 56.10% 34.02%
(a) Calculated using average shares.
(b) Amount includes $0.19 per share in litigation proceeds.
(c) Net asset value return represents portfolio returns based on change in the Trust's net asset value assuming the reinvestment of
all dividends and distributions which differs from the total investment return based on the Trust's market value due to the
difference between the Trust's net asset value and the market value of its shares outstanding; past performance is no guarantee
of future results.
(d) Annualized.
Senior securities:
Total principal amount (in millions) $ 20 $ 20 $ 20 $ 29 $ 20 $ 20
Asset coverage per $1,000
of indebtedness $ 13,900 $ 13,584 $ 12,814 $ 8,535 $ 10,689 $ 9,551
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
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6
ITEM 1. SCHEDULE OF INVESTMENTS.
CONSOLIDATED SCHEDULE OF INVESTMENTS MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES - 76.84%:(A) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
PRIVATE PLACEMENT INVESTMENTS - 70.31%
A T I ACQUISITION COMPANY
A for-profit post-secondary school serving students in
Texas, Florida and Arizona.
12% Senior Subordinated Note due 2012 $ 2,125,000 04/08/04 $ 2,125,000 $ 2,076,421
Warrant, exercisable until 2012, to purchase
common stock at $.02 per share (B) 2,323 shs. 04/08/04 -- 23
Warrant, exercisable until 2012, to purchase
preferred stock at $.01 per share (B) 63,287 shs. 03/23/06 63,958 63,958
------------ ------------
2,188,958 2,140,402
------------ ------------
ADORN, INC.
A manufacturer of wall panels, cabinets, moldings and
countertops for houses and recreational vehicles.
12.5% Subordinated Note due 2012 $ 1,465,517 02/29/00 1,394,356 1,465,517
Warrant, exercisable until 2012, to purchase
common stock at $.02 per share (B) 364 shs. 02/29/00 307,759 475,000
------------ ------------
1,702,115 1,940,517
------------ ------------
AERO HOLDINGS, INC.
A provider of geospatial services to corporate and
government clients.
10.5% Senior Secured Term Note due 2014 $ 1,627,500 03/09/07 1,603,088 1,595,464
14% Senior Subordinated Note due 2015 $ 1,260,000 03/09/07 1,123,273 1,232,984
Common Stock (B) 262,500 shs. 03/09/07 262,500 249,375
Warrant, exercisable until 2015, to purchase
common stock at $.01 per share (B) 66,116 shs. 03/09/07 111,527 661
------------ ------------
3,100,388 3,078,484
------------ ------------
AMERCABLE, INC.
A manufacturer of electric power, instrumentation
and control cables, primarily for the mining and oil and
gas industries.
12% Senior Subordinated Note due 2013 $ 1,101,852 04/08/05 1,046,368 1,123,889
Limited Partnership Interest (B) 0.36% int. 04/07/05 78,704 207,639
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 125 shs. 04/08/05 122,463 329,425
------------ ------------
1,247,535 1,660,953
------------ ------------
AMERICAN HOSPICE MANAGEMENT HOLDING LLC
A for-profit hospice care provider in the United States.
12% Senior Subordinated Note due 2010 $ 2,125,000 01/22/04 1,952,119 2,127,513
Preferred Class A Unit (B) 3,223 uts. * 322,300 354,530
Common Class B Unit (B) 30,420 uts. 01/22/04 1 61,359
Common Class D Unit (B) 6,980 uts. 09/12/06 1 14,079
------------ ------------
2,274,421 2,557,481
------------ ------------
ARROW TRU-LINE HOLDINGS, INC.
A manufacturer of hardware for residential and
commercial overhead garage doors in North America.
12% Senior Subordinated Note due 2012 $ 1,627,660 05/18/05 1,536,068 1,660,213
Common Stock (B) 497 shs. 05/18/05 497,340 427,058
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 130 shs. 05/18/05 112,128 111,955
------------ ------------
2,145,536 2,199,226
------------ ------------
*01/22/04 and 09/12/06.
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7
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
AUGUSTA SPORTSWEAR HOLDING CO.
A manufacturer and distributor of athletic apparel,
activewear and team uniforms.
12% Senior Subordinated Note due 2012 $ 1,686,800 12/31/04 $ 1,589,264 $ 1,737,404
Common Stock (B) 520 shs. * 519,622 1,092,637
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 137 shs. 12/31/04 119,482 289,103
------------ ------------
2,228,368 3,119,144
------------ ------------
BETA BRANDS LTD.
A manufacturer of hard candy and chocolate-coated
products sold primarily to the Canadian market.
5% Promissory Note due 2009 (B) $ 195,498 03/31/04 195,498 --
Warrant, exercisable until 2009, to purchase
common stock at $.01 per share (B) 4,895 shs. 03/31/04 1 --
------------ ------------
195,499 --
------------ ------------
BRAVO SPORTS HOLDING CORPORATION
A designer and marketer of niche branded consumer
products including canopies, trampolines, in-line skates,
skateboards, and urethane wheels.
12.5% Senior Subordinated Note due 2014 $ 2,281,593 06/30/06 2,148,945 2,170,111
Preferred Stock Class A (B) 879 shs. 06/30/06 268,121 241,307
Common Stock (B) 1 sh. 06/30/06 286 258
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 309 shs. 06/30/06 92,102 3
------------ ------------
2,509,454 2,411,679
------------ ------------
CAINS FOODS, L.P.
A producer of mayonnaise and sauce products for both the
retail and food service markets.
Limited Partnership Interest (B) 3.69 % int. 09/29/95 45,046 308,863
------------ ------------
CAPESUCCESS LLC
A provider of diversified staffing services.
Preferred Membership Interests (B) 1,882 uts. 04/29/00 8,395 420
Common Membership Interests (B) 24,318 uts. 04/29/00 108,983 5,442
------------ ------------
117,378 5,862
------------ ------------
CAPITAL SPECIALTY PLASTICS, INC.
A producer of desiccant strips used for packaging
pharmaceutical products.
Common Stock (B) 109 shs. ** 503 447,145
------------ ------------
COEUR, INC.
A producer of proprietary, disposable power
injection syringes.
8.75% Senior Secured Term Note due 2010 $ 462,862 04/30/03 462,862 469,478
11.5% Senior Subordinated Note due 2011 $ 424,819 04/30/03 398,694 428,359
Common Stock (B) 126,812 shs. 04/30/03 126,812 320,313
Warrant, exercisable until 2010, to purchase
common stock at $.01 per share (B) 87,672 shs. 04/30/03 40,804 221,450
------------ ------------
1,029,172 1,439,600
------------ ------------
*12/31/04, 03/31/05, and 05/02/06.
**12/30/97 and 05/29/99.
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8
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
COINING CORPORATION OF AMERICA LLC
A manufacturer of close tolerance parts and
metal stampings.
10.6% Senior Secured Revolving Credit
Facility due 2007 (C) $ 21,605 01/07/02 $ 21,605 $ 21,551
10.6% Senior Secured Tranche A Note due 2007 (C) $ 651,862 06/26/01 651,862 649,395
13% Senior Secured Tranche B Note due 2008 $ 648,148 06/26/01 648,148 648,148
Limited Partnership Interest (B) 6.38% int. 06/26/01 324,074 1,019,138
Warrant, exercisable until 2008, to purchase
common stock at $.01 per share (B) 107,036 shs. 06/26/01 79,398 336,603
------------ ------------
1,725,087 2,674,835
------------ ------------
CONNECTICUT ELECTRIC, INC.
A supplier and distributor of electrical products sold into
the retail and wholesale markets.
12% Senior Subordinated Note due 2014 $ 2,393,954 01/12/07 2,233,202 2,362,194
Limited Liability Company Unit Class A (B) 156,046 uts. 01/12/07 156,046 148,244
Limited Liability Company Unit Class C (B) 112,873 uts. 01/12/07 112,873 107,230
------------ ------------
2,502,121 2,617,668
------------ ------------
CONNOR SPORT COURT INTERNATIONAL, INC.
A designer and manufacturer of outdoor and indoor
synthetic sports flooring and other temporary
flooring products.
12% Senior Subordinated Note due 2012 (D) $ 2,001,121 * 1,840,888 1,000,561
Limited Partnership Interest (B) 7.74% int. ** 189,586 --
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 174 shs. * 160,233 --
------------ ------------
2,190,707 1,000,561
------------ ------------
CONSOLIDATED FOUNDRIES HOLDINGS
A manufacturer of engineered cast metal components for
the global aerospace and defense industries.
12% Senior Subordinated Note due 2013 $ 2,185,714 06/15/05 2,099,658 2,224,630
Common Stock (B) 509 shs. *** 526,096 661,433
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 103 shs. 06/15/05 100,668 133,779
------------ ------------
2,726,422 3,019,842
------------ ------------
COREPHARMA LLC
A manufacturer of oral dose generic pharmaceuticals
targeted at niche applications.
12% Senior Subordinated Note due 2013 $ 2,550,000 08/04/05 2,429,170 2,575,500
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 20 shs. 08/04/05 137,166 69,742
------------ ------------
2,566,336 2,645,242
------------ ------------
DAVIS-STANDARD LLC
A manufacturer, assembler, and installer of a broad range
of capital equipment that is used in the extrusion,
conversion, and processing of plastic materials.
12% Senior Subordinated Note due 2014 $ 1,847,826 10/30/06 1,729,693 1,862,362
Limited Partnership Interest (B) 702,174 uts. 10/30/06 702,174 667,065
Warrant, exercisable until 2014, to purchase
preferred stock at $.01 per share (B) 50 shs. 10/30/06 49,830 1
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 34 shs. 10/30/06 34,000 --
------------ ------------
2,515,697 2,529,428
------------ ------------
*08/12/04 and 01/18/05.
**08/12/04 and 01/14/05.
***06/15/05 and 05/22/06.
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9
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
DELTACOM, INC.
A provider of integrated communications services in the
southeastern United States.
13.88% Senior Secured Note due 2009 (C) $ 2,248,927 07/26/05 $ 2,204,516 $ 2,308,906
17.38% Senior Secured Note due 2009 (C) $ 368,300 07/26/05 325,217 366,459
Warrant, exercisable until 2009, to purchase
convertible preferred stock at $.03 per share (B) 102,884 shs. 07/26/05 34,295 284,989
------------ ------------
2,564,028 2,960,354
------------ ------------
DEXTER MAGNETICS TECHNOLOGIES, INC.
A designer, fabricator, assembler and distributor of
industrial magnets and subassemblies in North America
and Europe.
Common Stock (B) 585 shs. 07/19/01 351,088 948,661
Warrant, exercisable until 2007, to purchase
common stock at $.01 per share 297 shs. 07/19/01 131,981 480,823
------------ ------------
483,069 1,429,484
------------ ------------
DIRECTED ELECTRONICS, INC
A designer and distributor of brand name
automotive security systems, audio products and
installation accessories
Common Stock (B) 368,560 shs. * 1,856,534 3,087,661
Limited Partnership Interest (B) 8.70% int. ** 1 278,129
------------ ------------
1,856,535 3,365,790
------------ ------------
DIVERSCO, INC./DHI HOLDINGS, INC.
A contract provider of janitorial and equipment
maintenance services and temporary production labor to
industrial customers.
Membership Interests of MM/Lincap
Diversco Investments Ltd. LLC (B) 27.19% int. 08/27/98 734,090 --
Preferred Stock (B) 3,278 shs. 12/14/01 2,784,133 --
Warrants, exercisable until 2011, to purchase common
stock of DHI Holdings, Inc. at $.01 per share (B) 13,003 shs. *** 403,427 --
------------ ------------
3,921,650 --
------------ ------------
DUNCAN SYSTEMS, INC.
A distributor of windshields and side glass for the
recreational vehicle market.
10% Senior Secured Term Note due 2013 $ 540,000 11/01/06 531,900 529,561
13% Senior Subordinated Note due 2014 $ 855,000 11/01/06 761,961 835,877
Common Stock (B) 180,000 shs. 11/01/06 180,000 171,000
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 56,514 shs. 11/01/06 78,160 565
------------ ------------
1,552,021 1,537,003
------------ ------------
DWYER GROUP, INC.
A franchiser of a variety of home repair services.
Common Stock (B) 6,906 shs. **** 690,600 886,136
Warrant, exercisable until 2011, to purchase
common stock at $.01 per share (B) 2,034 shs. 10/30/03 186,469 260,938
------------ ------------
877,069 1,147,074
------------ ------------
*12/19/05 and 06/17/06.
**12/22/99 and 09/14/05.
***10/24/96 and 08/28/98.
****10/30/03 and 01/02/04.
----------------------------------------------------------------------------------------------------------------------------------
10
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
E X C ACQUISITION CORPORATION
A manufacturer of pre-filled syringes and pump systems
used for intravenous drug delivery.
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 22 shs. 06/28/04 $ 77,208 $ 154,550
------------ ------------
EAGLE PACK PET FOODS, INC.
A manufacturer of premium pet food sold through
independent pet stores.
12% Senior Subordinated Note due 2011 $ 1,517,857 * 1,480,781 1,533,036
Warrant, exercisable until 2011, to purchase
common stock at $.02 per share (B) 4,085 shs. 09/24/04 39,464 90,401
------------ ------------
1,520,245 1,623,437
------------ ------------
ENZYMATIC THERAPY, INC.
A manufacturer and distributor of branded natural
medicines and nutritional supplements.
Limited Partnership Interest (B) 1.32% int. 03/30/00 531,250 63,750
Warrant, exercisable until 2009, to purchase
common stock at $.01 per share (B) 29,117 shs. 03/30/00 255,000 42,500
------------ ------------
786,250 106,250
------------ ------------
EVANS CONSOLES, INC.
A designer and manufacturer of consoles and control
center systems.
Common Stock 90,000 shs. 05/06/04 6 --
------------ ------------
F H S HOLDINGS LLC
A national provider of customized disease management
services to large self-insured employers.
12% Senior Subordinated Note due 2014 $ 2,390,625 06/01/06 2,228,501 2,423,218
Preferred Unit (B) 158 uts. 06/01/06 157,780 142,002
Common Unit (B) 1,594 uts. 06/01/06 1,594 1,434
Common Unit Class B (B) 1,386 uts. 06/01/06 122,361 110,125
------------ ------------
2,510,236 2,676,779
------------ ------------
FLUTES, INC.
An independent manufacturer of micro fluted corrugated
sheet material for the food and consumer products
packaging industries.
10% Senior Secured Term Note due 2013 $ 918,385 04/13/06 904,609 923,309
14% Senior Subordinated Note due 2014 $ 555,059 04/13/06 498,870 558,729
Common Stock (B) 109,436 shs. 04/13/06 109,436 98,492
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 30,940 shs. 04/13/06 48,433 309
------------ ------------
1,561,348 1,580,839
------------ ------------
FOWLER HOLDING, INC.
A provider of site development services to residential
homebuilders and developers in the Raleigh/Durham
region of North Carolina.
12% Senior Subordinated Note due 2013 $ 2,365,217 02/03/06 2,143,271 2,332,416
Common Stock (B) 185 shs. 02/03/06 184,783 97,140
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 254 shs. 02/03/06 208,435 133,624
------------ ------------
2,536,489 2,563,180
------------ ------------
*09/24/04 and 4/20/06.
----------------------------------------------------------------------------------------------------------------------------------
11
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
FUEL SYSTEMS HOLDING CORPORATION
An independent North American supplier of fuel tanks for
a wide variety of commercial vehicles.
12% Senior Subordinated Note due 2014 $ 2,337,500 01/31/06 $ 2,181,882 $ 2,372,076
Common Stock (B) 212,500 shs. 01/31/06 212,500 368,145
Warrant, exercisable until 2016, to purchase
common stock at $.01 per share (B) 138,408 shs. 01/31/06 119,213 239,785
------------ ------------
2,513,595 2,980,006
------------ ------------
H M HOLDING COMPANY
A designer, manufacturer, and importer of promotional and
wood furniture.
12% Senior Subordinated Note due 2013 $ 2,210,000 02/10/06 2,058,324 2,046,902
Common Stock (B) 340 shs. 02/10/06 340,000 272,000
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 126 shs. 02/10/06 116,875 1
------------ ------------
2,515,199 2,318,903
------------ ------------
HAWK PRECISION COMPONENTS GROUP, INC.
A manufacturer of powder metal and metal injection
molded precision components used in industrial, consumer,
and other applications.
12% Senior Subordinated Note due 2014 $ 1,530,000 02/02/07 1,408,570 1,492,105
Limited Partnership Interest of
Saw Mill PCG Partners LLC (B) 1,020 uts. 02/02/07 1,020,000 969,000
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 91 shs. 02/02/07 90,830 1
------------ ------------
2,519,400 2,461,106
------------ ------------
HIGHGATE CAPITAL LLC
An acquirer of controlling or substantial interests in
manufacturing and marketing entities.
Series A Preferred Units (B) 1.19% int. 07/21/94 367,440 --
------------ ------------
HOME DECOR HOLDING COMPANY
A designer, manufacturer and marketer of framed art and
wall decor products.
12.5% Senior Subordinated Note due 2012 $ 2,043,269 * 1,881,047 2,064,198
Common Stock (B) 63 shs. * 62,742 86,673
Warrant, exercisable until 2012, to purchase
common stock at $.02 per share (B) 200 shs. * 199,501 275,600
------------ ------------
2,143,290 2,426,471
------------ ------------
INTEGRATION TECHNOLOGY SYSTEMS, INC.
A manufacturer of steel protective computer and network
systems for the industrial and office environments
12% Senior Secured Note due 2008 $ 1,644,444 03/01/04 1,646,101 1,248,333
Common Stock (B) 228 shs. 06/01/00 262,200 --
------------ ------------
1,908,301 1,248,333
------------ ------------
JASON, INC.
A diversified manufacturing company serving various
industrial markets.
13% Senior Subordinated Note due 2008 $ 963,687 08/04/00 928,972 954,050
14% Cumulative Redeemable Preferred Stock Series A (B) 289 shs. 08/04/00 289,224 280,542
Limited Partnership Interest of
Saw Mill Capital Fund II, L.P. (B) 2.50% int. 08/03/00 886,352 454,477
Warrants, exercisable until 2008 and 2009, to purchase
common stock at $.01 per share (B) 50,870 shs. 08/04/00 115,412 91,271
------------ ------------
2,219,960 1,780,340
------------ ------------
*06/30/04 and 08/19/04.
----------------------------------------------------------------------------------------------------------------------------------
12
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
JUSTRITE MANUFACTURING ACQUISITION CO.
A manufacturer of safety products such as storage cabinets
and containers.
12% Senior Subordinated Note due 2011 $ 1,593,750 12/15/04 $ 1,514,582 $ 1,609,688
Warrant, exercisable until 2011, to purchase
common stock at $.01 per share (B) 1,121 shs. 12/15/04 101,109 117,511
------------ ------------
1,615,691 1,727,199
------------ ------------
K N B HOLDINGS CORPORATION
A designer, manufacturer and marketer of products for the
custom framing market.
13.5% Senior Subordinated Note due 2013 $ 2,437,593 05/25/06 2,323,115 2,428,636
Common Stock (B) 134,210 shs. 05/25/06 134,210 120,789
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 82,357 shs. 05/25/06 71,534 824
------------ ------------
2,528,859 2,550,249
------------ ------------
K W P I HOLDINGS CORPORATION
A manufacturer and distributor of vinyl windows and patio
doors throughout the northwestern United States.
12% Senior Subordinated Note due 2014 $ 2,318,000 03/14/07 2,109,380 2,286,102
Common Stock (B) 232 shs. 03/13/07 232,000 220,400
Warrant, excercisable until 2017, to purchase
common stock at $.01 per share (B) 167 shs. 03/14/07 162,260 2
------------ ------------
2,503,640 2,506,504
------------ ------------
KEEPSAKE QUILTING, INC.
A seller of quilting fabrics, books, patterns, kits and
notions to consumers.
8.35% Senior Secured Revolving Note due 2007 (C) $ 146,771 06/16/00 146,771 147,756
8.35% Senior Secured Tranche A Note due 2007 (C) $ 68,799 07/19/00 68,799 68,674
12% Senior Secured Tranche B Note due 2008 $ 550,392 06/16/00 540,246 553,155
Limited Partnership Interest of
Riverside XVI Holding Company, L.P. (B) 5.29% int. 06/12/00 333,490 520,633
Warrant, exercisable until 2008, to purchase
common stock at $.01 per share (B) 1,108 shs. 06/12/00 45,866 174,526
------------ ------------
1,135,172 1,464,744
------------ ------------
KELE AND ASSOCIATES, INC.
A distributor of building automation control products.
12% Senior Subordinated Note due 2012 $ 1,831,548 02/27/04 1,700,485 1,849,863
Preferred Stock (B) 23 shs. 11/24/04 449,164 456,950
Common Stock (B) 12 shs. 02/27/04 12,871 294,732
Warrant, exercisable until 2012, to purchase
common stock at $.02 per share (B) 11 shs. 02/27/04 7,793 269,767
------------ ------------
2,170,313 2,871,312
------------ ------------
LIH INVESTORS, L.P.
A manufacturer and marketer of a broad line of external
accessories for new and used sport utility vehicles, trucks
and vans.
12.5% Senior Subordinated Note due 2008 (D) $ 3,845,000 * 3,587,623 1,922,500
Common Stock (B) 5,800 shs. * 406,003 --
Warrant, exercisable until 2008, to purchase
common stock at $.11 per share (B) 15,572 shs. * 602,127 --
------------ ------------
4,595,753 1,922,500
------------ ------------
*12/23/98 and 01/28/99.
----------------------------------------------------------------------------------------------------------------------------------
13
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
MAGNATECH INTERNATIONAL, INC.
A supplier of process equipment and related parts used
in the manufacturing of medium and high-pressure
reinforced hoses.
12% Senior Subordinated Note due 2014 $ 1,275,000 04/05/06 $ 1,188,501 $ 1,299,619
13% Preferred Stock (B) 565 shs. 04/05/06 565,335 537,064
Common Stock (B) 125 shs. 04/05/06 125,048 118,798
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 13 shs. 04/05/06 12,905 --
------------ ------------
1,891,789 1,955,481
------------ ------------
MAVERICK ACQUISITION COMPANY
A manufacturer of capsules that cover the cork and neck of
wine bottles.
9.85% Senior Secured Tranche A Note due 2010 (C) $ 637,169 09/03/04 637,169 640,023
12% Senior Secured Tranche B Note due 2011 $ 313,433 09/03/04 283,851 314,716
Limited Partnership Interest (B) 7.84% int. 09/03/04 58,769 57,753
Warrant, exercisable until 2011, to purchase
common stock at $.01 per share (B) 425 shs. 09/03/04 39,473 41,728
------------ ------------
1,019,262 1,054,220
------------ ------------
MAXON CORPORATION
A manufacturer of industrial combustion equipment and
related shut-off valves and control valves.
12% Senior Subordinated Note due 2012 $ 962,215 09/30/04 891,095 988,528
8.75% Senior Subordinated Note due 2012 $ 1,155,562 09/30/04 1,155,562 1,188,297
Common Stock (B) 381,672 shs. 09/30/04 381,672 1,151,850
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 153,572 shs. 09/30/04 90,897 463,465
------------ ------------
2,519,226 3,792,140
------------ ------------
MEDASSIST, INC.
A provider of patient eligibility and accounts receivable
management services to hospitals and physician practices.
8% Preferred Stock (B) 84 shs. 10/28/04 83,658 84,175
Common Stock (B) 26,185 shs. 10/28/04 35,088 94,509
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 84,637 shs. 05/01/03 40,675 305,480
------------ ------------
159,421 484,164
------------ ------------
MICROGROUP, INC.
A manufacturer of precision parts and assemblies, and a
value-added supplier of metal tubing and bars.
12% Senior Subordinated Note due 2013 $ 2,685,614 * 2,530,108 2,730,098
Common Stock (B) 450 shs. * 450,000 403,653
Warrant, exercisable until 2013, to purchase
common stock at $.02 per share (B) 164 shs. * 162,974 147,091
------------ ------------
3,143,082 3,280,842
------------ ------------
MOMENTUM HOLDING CO.
A designer and supplier of upholstery fabric to commercial
furniture manufacturers and architectural and design firms.
12% Senior Subordinated Note due 2014 $ 1,168,847 08/04/06 1,043,164 1,181,820
Limited Partnership Interest (B) 106,153 uts. 08/04/06 106,153 95,538
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 1,107 shs. 08/04/06 107,109 11
------------ ------------
1,256,426 1,277,369
------------ ------------
*08/12/05 and 09/11/06.
----------------------------------------------------------------------------------------------------------------------------------
14
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
MONESSEN HOLDING CORPORATION
A designer and manufacturer of a broad line of gas, wood,
and electric hearth products and accessories.
12% Senior Subordinated Note due 2014 $ 2,550,000 03/31/06 $ 2,370,551 $ 2,425,011
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 152 shs. 03/31/06 138,125 2
------------ ------------
2,508,676 2,425,013
------------ ------------
MORTON INDUSTRIAL GROUP, INC.
A manufacturer of highly engineered metal
fabricated components.
12% Senior Subordinated Note due 2014 $ 2,440,909 08/25/06 2,248,221 2,446,847
Common Stock (B) 109,091 shs. 08/25/06 109,091 98,182
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 173,633 shs. 08/25/06 149,940 1,736
------------ ------------
2,507,252 2,546,765
------------ ------------
MOSS, INC.
A manufacturer and distributor of large display and
exhibit structures.
Limited Partnership Interest of
Riverside Capital Appreciation Fund I, L.P. (B) 33.59% int. * 348,620 412,344
Warrant, exercisable until 2010, to purchase
common stock at $.01 per share (B) 214 shs. 12/21/05 36,647 25,315
------------ ------------
385,267 437,659
------------ ------------
NABCO, INC.
A producer of explosive containment vessels in the
United States.
12% Senior Subordinated Note due 2014 $ 625,000 02/24/06 578,353 583,750
Limited Liability Company Unit (B) 650 uts. 02/24/06 650,000 585,000
Warrant, exercisable until 2016, to purchase
common stock at $.01 per share (B) 48 shs. 02/24/06 37,188 --
------------ ------------
1,265,541 1,168,750
------------ ------------
NAVIS GLOBAL
A designer, manufacturer, seller and servicer of finishing
machinery for the knit and woven segments of the global
textile industry.
12% Senior Subordinated Note due 2014 $ 1,234,551 05/28/04 1,129,246 1,223,438
8.75% Senior Secured Note due 2011 $ 716,292 05/28/04 716,292 715,287
Common Stock (B) 674,157 shs. 05/28/04 674,157 573,033
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 203,912 shs. 05/28/04 130,789 2,039
------------ ------------
2,650,484 2,513,797
------------ ------------
NONNI'S FOOD COMPANY
A producer and distributor of premium biscotti and bagel
chips in North America.
12.25% Senior Subordinated Note due 2012 $ 1,863,462 03/29/04 1,856,139 1,890,504
10% Preferred Stock (B) 255 shs. 03/29/04 255,083 258,458
Common Stock (B) 6,455 shs. 03/29/04 6,455 156,148
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 8,622 shs. 03/29/04 7,323 208,572
------------ ------------
2,125,000 2,513,682
------------ ------------
*09/20/00, 05/23/02, and 02/21/07.
----------------------------------------------------------------------------------------------------------------------------------
15
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
NYLONCRAFT, INC.
A supplier of engineered plastic components for the
automotive industry.
9% Senior Secured Note due 2009 $ 812,500 01/28/02 $ 812,500 $ 771,875
11.5% Senior Subordinated Note due 2012 $ 1,500,000 01/28/02 1,401,093 750,000
Common Stock (B) 312,500 shs. 01/28/02 312,500 --
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 243,223 shs. 01/28/02 162,045 --
------------ ------------
2,688,138 1,521,875
------------ ------------
O R S NASCO HOLDING, INC.
A wholesale distributor of industrial supplies in
North America.
13% Senior Subordinated Note due 2013 $ 2,372,732 12/20/05 2,235,429 2,420,187
Common Stock (B) 177,268 shs. 12/20/05 177,268 212,106
Warrant, exercisable until 2015, to purchase
common stock at $.01 per share (B) 99,771 shs. 12/20/05 98,773 119,379
------------ ------------
2,511,470 2,751,672
------------ ------------
OAKRIVER TECHNOLOGY, INC.
Designs, engineers and assembles high precision
automated process equipment for the medical device
industry, with a focus on defibrillators and stents.
10% Senior Secured Note due 2012 $ 565,452 01/03/06 556,970 557,642
13% Senior Subordinated Note due 2013 $ 687,241 01/03/06 616,783 676,404
Common Stock (B) 322,307 shs. 01/03/06 322,307 290,076
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 75,378 shs. 01/03/06 62,824 754
------------ ------------
1,558,884 1,524,876
------------ ------------
OLYMPIC SALES, INC.
A boat retailer in Washington state, Oregon, California and
British Columbia.
12% Senior Subordinated Note due 2008 $ 1,606,000 08/07/98 1,606,000 1,559,196
12% Senior Subordinated Note due 2008 $ 307,071 02/09/00 300,073 301,490
Limited Partnership Interest of Riverside VIII,
VIII-A and VIII-B Holding Company, L.P. 20.57% int. * 1,555,992 1,555,626
Warrants, exercisable until 2007 and 2008, to purchase
common stock at $.01 per share (B) 28,648 shs. ** 389,188 385,720
------------ ------------
3,851,253 3,802,032
------------ ------------
ONTARIO DRIVE & GEAR LTD.
A manufacturer of all-wheel drive, off-road amphibious
vehicles and related accessories.
13% Senior Subordinated Note due 2013 $ 1,977,885 01/17/06 1,788,635 2,003,289
Limited Liability Company Unit (B) 3,667 uts. 01/17/06 572,115 680,542
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 619 shs. 01/17/06 170,801 114,900
------------ ------------
2,531,551 2,798,731
------------ ------------
OVERTON'S HOLDING COMPANY
A marketer of marine and water sports accessories in the
United States.
12% Senior Subordinated Note due 2014 $ 1,817,308 04/28/06 1,703,368 1,820,692
Common Stock (B) 95 shs. 04/28/06 95,000 85,500
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 94 shs. 04/28/06 83,720 1
------------ ------------
1,882,088 1,906,193
------------ ------------
*08/07/98, 02/23/99, 12/22/99 and 02/25/03.
**08/07/98 and 02/09/00.
----------------------------------------------------------------------------------------------------------------------------------
16
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
P A S HOLDCO LLC
An independent provider of maintenance, repair and
overhaul services to the aerospace gas turbine engine and
airframe markets.
14% Senior Subordinated Note due 2014 $ 2,189,217 07/03/06 $ 2,080,394 $ 2,208,891
Preferred Unit (B) 382 uts. 07/03/06 382,150 363,043
Preferred Unit (B) 69 uts. 07/03/06 68,790 65,351
Common Unit Class I (B) 148 uts. 07/03/06 -- 1
Common Unit Class L (B) 31 uts. 07/03/06 -- --
------------ ------------
2,531,334 2,637,286
------------ ------------
P I I HOLDING CORPORATION
A manufacturer of plastic film and bags for the general
industrial, medical, and food industries.
12% Senior Subordinated Note due 2013 $ 2,295,000 03/31/06 2,148,643 2,294,037
Preferred Stock (B) 36 shs. 03/31/06 329,596 313,116
Common Stock (B) 23 shs. 03/31/06 25,500 22,950
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 13 shs. 03/31/06 11,122 --
------------ ------------
2,514,861 2,630,103
------------ ------------
PARADIGM PACKAGING, INC.
A manufacturer of plastic bottles and closures for the
nutritional, pharmaceutical, personal care and food
packaging markets.
12% Senior Subordinated Note due 2008 $ 2,125,000 12/19/00 2,039,288 2,117,156
Membership Interests of MM/Lincap
PPI Investments, Inc., LLC (B) 2.42% int. 12/21/00 265,625 367,334
------------ ------------
2,304,913 2,484,490
------------ ------------
POSTLE ALUMINUM COMPANY LLC
A manufacturer and distributor of aluminum
extruded products.
12% Senior Subordinated Note due 2014 $ 2,040,000 10/02/06 1,889,214 2,051,937
Limited Liability Company Unit (B) 1,384 uts. 10/02/06 510,000 484,497
Warrant, exercisable until 2016, to purchase
common stock at $.01 per share (B) 344 shs. 10/02/06 124,644 3
------------ ------------
2,523,858 2,536,437
------------ ------------
PROTEIN GENETICS, INC.
A producer of bovine artificial insemination products,
related breeding and healthcare products and specialty
genetics sold to the dairy and beef industries.
9.8% Redeemable Exchangeable Preferred Stock (B) 1,004 shs. 08/12/94 100,350 --
Common Stock (B) 2,600 shs. * 126,866 --
------------ ------------
227,216 --
------------ ------------
QUALIS AUTOMOTIVE LLC
A distributor of aftermarket automotive brake and
chassis products.
12% Senior Subordinated Note due 2012 $ 1,770,833 05/28/04 1,494,130 1,773,142
Common Stock 354,166 shs. 05/28/04 354,166 121,880
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share 377,719 shs. 05/28/04 377,719 129,985
------------ ------------
2,226,015 2,025,007
------------ ------------
*11/14/01 and 08/12/94.
----------------------------------------------------------------------------------------------------------------------------------
17
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
QUALSERV CORPORATION
A provider of foodservice equipment and supplies to major
restaurant chains and their franchisees.
14% Senior Subordinated Note due 2012 (D) $ 1,893,563 07/09/04 $ 1,844,035 $ --
Limited Partnership Interest (B) 9.26% int. 07/09/04 259,146 --
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 528 shs. 07/09/04 49,061 --
------------ ------------
2,152,242 --
------------ ------------
R A J MANUFACTURING HOLDINGS LLC
A designer and manufacturer of women's swimwear sold
under a variety of licensed brand names.
12.5% Senior Subordinated Note due 2014 $ 2,267,190 12/15/06 2,090,363 2,272,712
Limited Liability Company Unit (B) 2,828 uts. 12/15/06 282,810 268,670
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 3 shs. 12/15/06 131,483 --
------------ ------------
2,504,656 2,541,382
------------ ------------
RADIAC ABRASIVES, INC.
A manufacturer of bonded abrasive and super abrasive
grinding wheels in the United States.
12% Senior Subordinated Note due 2014 $ 2,260,638 02/10/06 2,107,299 2,328,457
Common Stock (B) 289,362 shs. 02/10/06 289,362 260,426
Warrant, exercisable until 2016, to purchase
common stock at $.01 per share (B) 131,555 shs. 02/10/06 119,796 1,316
------------ ------------
2,516,457 2,590,199
------------ ------------
RIVER RANCH FRESH FOODS LLC
A supplier of fresh produce to the retail and
foodservice channels.
13% Senior Subordinated Note due 2011 (D) $ 1,841,667 09/29/04 1,683,764 1,473,334
Limited Liability Company Unit (B) 40,610 uts. 09/29/04 283,333 --
18% Preferred Stock (B) 141,667 shs. 11/16/06 141,667 141,667
Warrant, exercisable until 2011, to purchase
common stock at $.01 per share (B) 23,575 shs. 09/29/04 157,903 --
------------ ------------
2,266,667 1,615,001
------------ ------------
ROYAL BATHS MANUFACTURING COMPANY
A manufacturer and distributor of acrylic and cultured
marble bathroom products.
12.5% Senior Subordinated Notes due 2011 $ 1,062,500 11/14/03 975,569 1,083,750
Warrant, exercisable until 2011, to purchase
common stock at $.01 per share (B) 140 shs. 11/14/03 122,946 191,250
------------ ------------
1,098,515 1,275,000
------------ ------------
SAFETY SPEED CUT MANUFACTURING COMPANY, INC.
A manufacturer of vertical panel saws and routers for the
wood working industry.
8.85% Senior Secured Tranche A Note due 2007 (C) $ 141,332 06/02/99 141,332 141,332
12% Senior Secured Tranche B Note Due 2007 $ 1,130,652 06/02/99 1,130,652 1,130,652
Class B Common Stock (B) 1,480 shs. 06/02/99 256,212 1,161,675
------------ ------------
1,528,196 2,433,659
------------ ------------
SAVAGE SPORTS HOLDING, INC.
A manufacturer of sporting firearms.
12% Senior Subordinated Note due 2012 $ 1,538,793 09/10/04 1,447,936 1,564,376
Common Stock (B) 586 shs. 09/10/04 586,207 612,815
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 134 shs. 09/10/04 113,578 139,684
------------ ------------
2,147,721 2,316,875
------------ ------------
----------------------------------------------------------------------------------------------------------------------------------
18
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
SPECIALTY FOODS GROUP, INC.
A manufacturer and distributor of branded meat products.
Limited Partnership Interest of MHD Holdings LLC 1.43% int. 08/29/00 $ 684,724 $ --
------------ ------------
STANTON CARPET HOLDING CO.
A designer and marketer of high and mid-priced decorative
carpets and rugs.
12.13% Senior Subordinated Note due 2014 $ 2,239,024 08/01/06 2,105,029 2,243,802
Common Stock (B) 311 shs. 08/01/06 310,976 279,882
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 104 shs. 08/01/06 93,293 1
------------ ------------
2,509,298 2,523,685
------------ ------------
STRATEGIC EQUIPMENT & SUPPLY CORPORATION, INC.
A provider of kitchen and restaurant design, equipment
fabrication and installation services.
Warrant, exercisable until 2008, to purchase
common stock at $.01 per share (B) 106,539 shs. 01/14/00 658,751 --
------------ ------------
SYNVENTIVE EQUITY LLC
A manufacturer of hot runner systems used in the plastic
injection molding process.
Limited Liability Company Unit (B) 1.99% int. 08/20/03 63,206 14,100
Warrant, exercisable until 2011, to purchase
common stock at $.01 per share (B) 86,780 shs. 08/21/03 19,359 19,359
------------ ------------
82,565 33,459
------------ ------------
TANGENT RAIL CORPORATION
A manufacturer of rail ties and provides specialty services
to the North American railroad industry.
13% Senior Subordinated Note due 2013 $ 2,217,385 10/14/05 1,911,165 2,261,733
Preferred Stock 1,324 shs. 10/14/05 132,370 139,652
Common Stock (B) 2,203 shs. 10/14/05 2,203 396,211
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 1,167 shs. 10/14/05 294,403 209,886
------------ ------------
2,340,141 3,007,482
------------ ------------
TERRA RENEWAL SERVICES, INC.
A provider of wastewater residual management and
required environmental reporting, permitting, nutrient
management planning and record keeping to companies
involved in poultry and food processing.
8.6% Senior Secured Tranche B Note due 2012 (C) $ 1,530,066 * 1,524,917 1,514,986
12% Senior Subordinated Note due 2014 $ 1,162,110 ** 1,106,914 1,164,795
Limited Partnership Interest of
Saw Mill Capital Fund V, L.P. 2.30% int. 03/01/05 116,285 194,175
Warrant, exercisable until 2016, to purchase
common stock at $.01 per share (B) 72 shs. 04/28/06 60,597 48,749
------------ ------------
2,808,713 2,922,705
------------ ------------
TOTAL EQUIPMENT & SERVICE, INC.
A manufacturer of a wide variety of equipment used in the
oil and gas industry.
10.5% Senior Secured Term Note due 2013 $ 851,351 03/02/07 838,581 839,062
13% Senior Subordinated Note due 2014 $ 598,450 03/02/07 490,608 587,601
Common Stock (B) 125,199 shs. 03/02/07 125,199 118,939
Warrant, exercisable until 2014 to purchase
common stock at $.01 per share (B) 34,533 shs. 03/02/07 95,873 345
------------ ------------
1,550,261 1,545,947
------------ ------------
*04/28/06 and 12/21/06.
**04/28/06 and 09/13/06.
----------------------------------------------------------------------------------------------------------------------------------
19
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
THE TRANZONIC COMPANIES
A producer of commercial and industrial supplies,
such as safety products, janitorial supplies, work
apparel, washroom and restroom supplies and sanitary
care products.
13% Senior Subordinated Note due 2009 $ 2,712,000 02/05/98 $ 2,582,241 $ 2,712,000
Common Stock (B) 630 shs. 02/04/98 630,000 217,510
Warrant, exercisable until 2009, to purchase
common stock at $.01 per share (B) 444 shs. 02/05/98 368,832 153,293
------------ ------------
3,581,073 3,082,803
------------ ------------
TRANSTAR HOLDING COMPANY
A distributor of aftermarket automotive transmission parts.
12% Senior Subordinated Note due 2013 $ 1,734,000 08/31/05 1,665,084 1,780,410
Common Stock (B) 816 shs. 08/31/05 816,000 764,272
Warrant, exercisable until 2013, to purchase
common stock at $.01 per share (B) 86 shs. 08/31/05 77,485 80,492
------------ ------------
2,558,569 2,625,174
------------ ------------
TRONAIR, INC.
A designer, engineer and manufacturer of ground support
equipment for the business, commuter and commercial
aviation markets.
10.5% Senior Secured Term Note due 2008 $ 395,108 01/20/00 395,108 397,298
12% Senior Subordinated Note due 2010 $ 1,326,500 01/20/00 1,289,702 1,349,704
Common Stock (B) 227,400 shs. 01/20/00 227,400 873,418
Warrant, exercisable until 2010, to purchase
common stock at $1 per share (B) 260,563 shs. 01/20/00 98,540 1,000,794
------------ ------------
2,010,750 3,621,214
------------ ------------
TRUCK BODIES & EQUIPMENT INTERNATIONAL
A designer and manufacturer of accessories for heavy and
medium duty trucks, primarily dump bodies, hoists,
various forms of flat-bed bodies, landscape bodies and
other accessories.
12% Senior Subordinated Note due 2013 $ 2,309,541 * 2,159,987 2,361,074
Common Stock (B) 742 shs. * 800,860 1,843,139
Warrant, exercisable until 2013, to purchase
common stock at $.02 per share (B) 153 shs. * 159,894 380,674
------------ ------------
3,120,741 4,584,887
------------ ------------
TRUSTILE DOORS, INC.
A manufacturer and distributor of interior doors.
12.5% Senior Subordinated Note due 2010 $ 1,062,500 04/11/03 1,009,574 1,083,750
Warrant, exercisable until 2010, to purchase
common stock at $.01 per share (B) 5,781 shs. 04/11/03 90,618 218,556
------------ ------------
1,100,192 1,302,306
------------ ------------
U S S HOLDINGS, INC.
A producer of high grade industrial and specialty silica sands.
14% Redeemable Preferred Stock (B) 997 shs. 09/30/99 545,858 933,236
Convertible Preferred Stock Series A and B, convertible
into common stock at $8.02 per share (B) 145,446 shs. 12/19/96 1,166,830 --
Common Stock (B) 20,027 shs. 09/30/99 799,068 --
Warrants, exercisable until 2010 to
purchase common stock at $.01 per share (B) 4,918 shs. ** 128,372 --
------------ ------------
2,640,128 933,236
------------ ------------
*07/19/05 and 12/22/05.
**12/19/96 and 09/30/99.
----------------------------------------------------------------------------------------------------------------------------------
20
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares, Units,
Warrants,
Ownership or Acquisition
CORPORATE RESTRICTED SECURITIES:(A)(Continued) Principal Amount Date Cost Fair Value
-------------- -------- ------------ ------------
U-LINE CORPORATION
A manufacturer of high-end, built-in, undercounter ice
making, wine storage and refrigeration appliances.
12.5% Senior Subordinated Note due 2012 $ 1,882,100 04/30/04 $ 1,719,273 $ 1,882,100
Common Stock (B) 182 shs. 04/30/04 182,200 310,250
Warrant, exercisable until 2012, to purchase
common stock at $.01 per share (B) 230 shs. 04/30/04 211,736 392,360
------------ ------------
2,113,209 2,584,710
------------ ------------
VICTORY VENTURES LLC
An acquirer of controlling or substantial interests in
other entities.
Series A Preferred Units (B) 0.15% int. 12/02/96 1 --
------------ ------------
VITALITY FOODSERVICE, INC.
A non-carbonated beverage dispensing company focused
on the foodservice industry.
15% Senior Subordinated Note due 2011 $ 1,948,061 09/24/04 1,810,084 1,762,254
Common Stock (B) 26,456 shs. * 264,558 211,648
Warrant, exercisable until 2011, to purchase
common stock at $.01 per share (B) 23,787 shs. 09/24/04 186,883 190,296
------------ ------------
2,261,525 2,164,198
------------ ------------
VITEX PACKAGING GROUP, INC.
A manufacturer of specialty packaging, primarily
envelopes and tags used on tea bags.
12.5% Senior Subordinated Note due 2012 $ 1,700,000 07/19/04 1,483,065 1,562,326
Limited Liability Company Unit Class A (B) 1.75% int. 07/19/04 414,375 331,500
Limited Liability Company Unit Class B (B) 0.77% int. 07/19/04 182,935 146,348
------------ ------------
2,080,375 2,040,174
------------ ------------
WALLS INDUSTRIES, INC.
A provider of branded workwear and sporting goods apparel.
12.35% Senior Subordinated Lien Note due 2009 (C) $ 652,413 07/12/04 652,413 653,391
14% Senior Subordinated Note due 2012 $ 1,085,380 07/12/04 1,082,856 1,107,088
Limited Partnership Interest (B) 0.40% int. 07/12/04 37,281 684,735
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 4,029 shs. 07/12/04 2,833 73,997
------------ ------------
1,775,383 2,519,211
------------ ------------
WELLBORN FOREST HOLDING CO.
A manufacturer of semi-custom kitchen and bath cabinetry.
12.13% Senior Subordinated Note due 2014 $ 1,721,250 11/30/06 1,602,025 1,682,600
Common Stock (B) 191 shs. 11/30/06 191,250 181,688
Warrant, exercisable until 2014, to purchase
common stock at $.01 per share (B) 95 shs. 11/30/06 86,493 1
------------ ------------
1,879,768 1,864,289
------------ ------------
Total Private Placement Investments $180,747,138 $181,395,519
------------ ------------
*09/24/04 and 12/22/06.
----------------------------------------------------------------------------------------------------------------------------------
21
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares or
Interest Due Principal
CORPORATE RESTRICTED SECURITIES: (A) (CONTINUED) Rate Date Amount Cost Fair Value
------- -------- ------------ ------------ ------------
RULE 144A SECURITIES - 6.53%:
BONDS - 6.53%
American Tire Distributor (C) 11.610% 04/01/12 $ 1,000,000 $ 950,000 $ 1,000,000
Aramark Corporation 8.500 02/01/15 200,000 200,000 207,000
Aramark Corporation 8.860 02/01/15 200,000 200,000 205,750
Bombardier, Inc. 6.300 05/01/14 1,000,000 890,000 950,000
Calpine Corporation 8.750 07/15/13 500,000 465,000 532,500
Chaparral Energy, Inc. 8.875 02/01/17 1,500,000 1,491,780 1,507,500
Charter Communications Op LLC 8.000 04/30/12 250,000 249,375 260,313
Douglas Dynamics LLC 7.750 01/15/12 630,000 633,138 585,900
G F S I, Inc. (C) 11.500 06/01/11 750,000 682,541 742,500
H C A, Inc. 9.250 11/15/16 975,000 992,077 1,051,781
Hawker Beechcraft Acquisition Co. 9.750 04/01/17 50,000 50,000 52,250
Idearc, Inc. 8.000 11/15/16 600,000 600,000 617,250
Packaging Dynamics Corporation of America 10.000 05/01/16 1,250,000 1,256,718 1,287,500
Pregis Corporation 12.375 10/15/13 1,000,000 981,490 1,100,000
Rental Service Corporation 9.500 12/01/14 1,000,000 1,014,073 1,065,000
Sbarro, Inc. 10.375 02/01/15 1,000,000 1,019,857 1,040,000
Steel Dynamics, Inc. 6.750 04/01/15 200,000 200,000 200,500
Stewart & Stevenson LLC 10.000 07/15/14 1,500,000 1,540,281 1,571,250
Tekni-Plex, Inc. 9.750 11/15/13 650,000 655,604 650,000
Tenaska Alabama Partners LP 7.000 06/30/21 342,701 342,701 344,884
Titan International, Inc. 8.000 01/15/12 150,000 150,000 154,313
Tube City IMS Corporation 9.750 02/01/15 625,000 649,891 650,000
Tunica-Biloxi Gaming Authority 9.000 11/15/15 1,000,000 1,031,675 1,062,500
------------ ------------
TOTAL BONDS 16,246,201 16,838,691
------------ ------------
COMMON STOCK - 0.00%
Jordan Telecom Products (B) 70 $ 14,000 --
------------ ------------
TOTAL COMMON STOCK 14,000 --
------------ ------------
WARRANTS - 0.00%
Winsloew Furniture, Inc. (B) 900 $ 9 $ --
------------ ------------
TOTAL WARRANTS 9 --
------------ ------------
TOTAL RULE 144A SECURITIES 16,260,210 16,838,691
------------ ------------
TOTAL CORPORATE RESTRICTED SECURITIES $197,007,348 $198,234,210
------------ ------------
----------------------------------------------------------------------------------------------------------------
22
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Interest Due Principal
CORPORATE PUBLIC SECURITIES - 27.16%: (A) Rate Date Amount Cost Market Value
------- -------- ------------ ------------ ------------
BONDS - 25.87%
A M C Entertainment, Inc. 11.000% 02/01/16 $ 815,000 $ 817,362 $ 928,080
Activant Solutions, Inc. 9.500 05/01/16 150,000 150,000 147,750
Affinia Group, Inc. 9.000 11/30/14 1,010,000 936,125 1,025,150
Alamosa Delaware, Inc. 11.000 07/31/10 325,000 328,528 347,353
Alamosa Delaware, Inc. 8.500 01/31/12 400,000 400,000 423,558
ALH Fin LLC / ALH Fin Corporation 8.500 01/15/13 1,450,000 1,418,813 1,446,375
Allied Waste NA 7.875 04/15/13 1,000,000 1,021,459 1,037,500
Appleton Papers, Inc. 8.125 06/15/11 300,000 300,000 308,250
Atlas Pipeline Partners 8.125 12/15/15 200,000 200,000 206,000
Bally Total Fitness Holdings Corporation 9.875 10/15/07 135,000 128,925 109,013
Basic Energy Services 7.125 04/15/16 225,000 225,000 219,375
BCP Crystal US Holdings Corporation 9.625 06/15/14 485,000 485,000 550,920
Blockbuster, Inc. (C) 9.000 09/01/12 475,000 475,903 479,750
Brigham Exploration Co. 9.625 05/01/14 700,000 690,403 707,000
CCH I Holdings LLC 11.125 01/15/14 2,000,000 1,573,688 1,870,000
Cablevision Systems Corporation 8.000 04/15/12 1,000,000 1,013,079 1,015,000
Cenveo Corporation 7.875 12/01/13 1,100,000 1,100,000 1,078,000
Chemed Corporation 8.750 02/24/11 1,125,000 1,125,000 1,170,000
Cincinnati Bell, Inc. 8.375 01/15/14 1,100,000 1,007,500 1,124,750
Clayton Williams Energy, Inc. 7.750 08/01/13 800,000 800,000 752,000
Dave and Buster's, Inc. 11.250 03/15/14 1,500,000 1,537,565 1,530,000
Del Monte Corporation 8.625 12/15/12 225,000 225,000 234,000
Dynegy Holdings, Inc. 6.875 04/01/11 500,000 422,500 501,250
Dynegy Holdings, Inc. 8.375 05/01/16 330,000 330,000 343,200
Edison Mission Energy 7.750 06/15/16 55,000 55,000 57,338
Esterline Technologies 7.750 06/15/13 200,000 200,000 205,500
Flextronics International Ltd. 6.500 05/15/13 400,000 400,000 396,000
Ford Motor Credit Co. 7.375 10/28/09 1,250,000 1,246,875 1,247,703
Ford Motor Credit Co. 8.000 12/15/16 300,000 294,966 288,980
Freeport-McMoran Copper & Gold 8.375 04/01/17 385,000 385,000 416,280
Gencorp, Inc. 9.500 08/15/13 259,000 259,000 275,835
General Motors Acceptance Corporation 7.750 01/19/10 1,250,000 1,290,037 1,283,026
General Motors Corporation 8.250 07/15/23 1,000,000 920,000 900,000
Goodyear Tire & Rubber Co. 7.857 08/15/11 1,400,000 1,342,750 1,464,750
GulfMark Offshore, Inc. 7.750 07/15/14 565,000 562,599 573,475
Hawaiian Telcom Communications 12.500 05/01/15 1,425,000 1,567,979 1,560,375
Inergy LP 8.250 03/01/16 150,000 150,000 157,500
Insurance Auto Auctions, Inc. 11.000 04/01/13 1,000,000 1,008,740 1,155,000
Interline Brands, Inc. 8.125 06/15/14 325,000 322,670 335,563
Iron Mountain, Inc. 8.750 07/15/18 1,065,000 1,099,566 1,144,875
Koppers, Inc. 9.875 10/15/13 477,000 477,000 517,545
Land O'Lakes, Inc. 9.000 12/15/10 750,000 750,000 795,000
Lazard LLC 7.125 05/15/15 750,000 749,408 790,713
Leucadia National Corporation 7.000 08/15/13 650,000 660,695 653,250
Liberty Media Corporation 5.700 05/15/13 1,000,000 951,610 958,770
M G M Mirage, Inc. 6.000 10/01/09 375,000 378,013 375,469
Mac-Gray Corporation 7.625 08/15/15 600,000 600,000 612,000
Majestic Star Casino LLC 9.500 10/15/10 500,000 500,000 524,375
Manitowoc Company, Inc. 7.125 11/01/13 200,000 200,000 204,000
Markwest Energy Operating Co. 6.875 11/01/14 775,000 763,000 751,750
Mediacom Broadband LLC 8.500 10/15/15 1,000,000 1,021,845 1,022,500
Metaldyne Corporation 11.000 06/15/12 750,000 601,250 710,588
Metaldyne Corporation (C) 10.000 11/01/13 510,000 513,403 521,475
N R G Energy, Inc. 7.375 02/01/16 175,000 175,000 179,813
NTL Cable PLC 9.125 08/15/16 980,000 1,002,682 1,033,900
Nalco Co. 7.750 11/15/11 500,000 500,000 512,500
Neiman Marcus Group, Inc. 10.375 10/15/15 1,250,000 1,250,000 1,393,750
Newark Group, Inc. 9.750 03/15/14 850,000 796,863 886,125
----------------------------------------------------------------------------------------------------------------
23
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Interest Due Principal
Corporate Public Securities: (A) (Continued) Rate Date Amount Cost Market Value
------- -------- ------------ ------------ ------------
BONDS, CONTINUED
North American Energy Partners 8.750% 12/01/11 $ 400,000 $ 400,000 $ 408,000
Nova Chemicals Corporation (C) 8.502 11/15/13 475,000 475,000 472,625
O E D Corp / Diamond Jo Company Guarantee 8.750 04/15/12 1,000,000 985,960 992,500
Offshore Logistics, Inc. 6.125 06/15/13 450,000 450,000 428,625
P Q Corporation 7.500 02/15/13 1,100,000 1,088,750 1,111,000
Pacific Energy Partners 7.125 06/15/14 500,000 503,623 522,160
Pacific Energy Partners 6.250 09/15/15 150,000 149,316 149,993
Petrohawk Energy Corp. 9.125 07/15/13 1,000,000 997,864 1,065,000
Pinnacle Foods Group 8.250 12/01/13 450,000 450,000 489,398
Pliant Corporation (C) 11.850 06/15/09 882,910 887,668 999,896
Primedia, Inc. 8.000 05/15/13 1,000,000 1,021,962 1,035,000
Quality Distribution LLC 9.000 11/15/10 1,030,000 1,001,575 988,800
Quality Distribution LLC (C) 9.860 01/15/12 325,000 323,375 328,250
Quicksilver Resources, Inc. 7.125 04/01/16 500,000 500,000 492,500
Rent-A-Center, Inc. 7.500 05/01/10 400,000 400,000 403,000
Rock-Tenn Co. 8.200 08/15/11 175,000 176,088 185,500
Service Corp International (C) 7.000 06/15/17 1,000,000 990,030 1,007,500
Sheridan Acquisition Corporation 10.250 08/15/11 375,000 370,000 392,344
Sierra Pacific Resources 6.750 08/15/17 635,000 638,103 648,209
Stanadyne Corporation 10.000 08/15/14 1,500,000 1,500,000 1,545,000
Stratos Global 9.875 02/15/13 575,000 578,580 613,813
Tekni-Plex, Inc. 12.750 06/15/10 1,000,000 960,125 935,000
Tenet Healthcare Corporation 9.875 07/01/14 500,000 488,370 505,000
Tenneco, Inc. 8.625 11/15/14 1,000,000 1,002,500 1,042,500
Tennessee Gas Pipeline Co. 7.000 03/15/27 500,000 523,652 534,035
Texas Industries, Inc. 7.250 07/15/13 70,000 70,000 72,100
Trimas Corporation 9.875 06/15/12 1,065,000 1,006,250 1,063,669
Triton PCS, Inc. 8.500 06/01/13 550,000 550,000 566,500
Unisys Corporation 8.000 10/15/12 190,000 190,000 190,475
United Components, Inc. 9.375 06/15/13 1,080,000 1,081,490 1,117,800
United Rentals, Inc. 7.750 11/15/13 625,000 625,000 642,188
United Rentals, Inc. 7.000 02/15/14 500,000 500,000 498,750
Universal City Florida (C) 10.110 05/01/10 200,000 200,000 206,250
Universal City Florida (C) 8.375 05/01/10 200,000 200,000 206,250
Vertis, Inc. 10.875 06/15/09 1,030,000 1,040,133 1,040,300
Vought Aircraft Industries 8.000 07/15/11 1,000,000 999,548 980,000
Warner Music Group Corporation 7.375 04/15/14 275,000 275,000 261,938
Waste Services, Inc. 9.500 04/15/14 1,100,000 1,123,637 1,152,250
------------ ------------
TOTAL BONDS 64,431,400 66,754,115
------------ ------------
----------------------------------------------------------------------------------------------------------------
24
CONSOLIDATED SCHEDULE OF INVESTMENTS(CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Shares or
Interest Due Principal
Corporate Public Securities: (A) (Continued) Rate Date Amount Cost Market Value
------- -------- ------------ ------------ ------------
COMMON STOCK - 1.06%
Bally Total Fitness Holdings Corporation (B) 600 $ 5,520 $ 366
PepsiAmericas, Inc. 92,145 2,006,365 2,056,676
Supreme Industries, Inc. 115,721 267,323 676,968
------------ ------------
TOTAL COMMON STOCK 2,279,208 2,734,010
------------ ------------
CONVERTIBLE BONDS - 0.23%
Citadel Broadcasting Corporation 1.875% 02/15/11 $ 700,000 $ 543,375 $ 593,250
------------ ------------
TOTAL CONVERTIBLE BONDS 543,375 593,250
------------ ------------
TOTAL CORPORATE PUBLIC SECURITIES $ 67,253,983 $ 70,081,375
------------ ------------
Interest Due Principal
SHORT-TERM SECURITIES: Rate/Yield* Date Amount Cost Market Value
-------- -------- ------------ ------------ ------------
COMMERCIAL PAPER - 2.01%
Kraft Foods, Inc. 5.450% 04/02/07 $ 5,187,000 $ 5,185,429 $ 5,185,429
------------ ------------
TOTAL SHORT-TERM SECURITIES $ 5,185,429 $ 5,185,429
------------ ------------
TOTAL INVESTMENTS 106.01% $269,446,760 $273,501,014
============ ------------
Other Assets 2.50 6,464,636
Liabilities (8.51) (21,966,127)
------ ------------
TOTAL NET ASSETS 100.00% $257,999,523
====== ============
(A) In each of the convertible note, warrant, convertible preferred and common stock investments, the issuer has agreed to
provide certain registration rights.
(B) Non-income producing security.
(C) Variable rate security; rate indicated is as of 03/31/07.
(D) Defaulted security; interest not accrued.
* Effective yield at purchase
See Notes to Consolidated Financial Statements.
----------------------------------------------------------------------------------------------------------------
25
CONSOLIDATED SCHEDULE OF INVESTMENTS (CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Fair Value/ Fair Value/
INDUSTRY CLASSIFICATION: Market Value Market Value
-------------- --------------
AEROSPACE - 2.76% BUILDINGS & REAL ESTATE - 2.26%
Consolidated Foundries Holdings $ 3,019,842 Adorn, Inc. $ 1,940,517
Esterline Technologies 205,500 K W P I Holdings Corporation 2,506,504
Gencorp, Inc. 275,835 Texas Industries, Inc. 72,100
P A S Holdco LLC 2,637,286 TruStile Doors, Inc. 1,302,306
Vought Aircraft Industries 980,000 --------------
-------------- 5,821,427
7,118,463 --------------
-------------- CHEMICAL, PLASTICS & RUBBER - 1.40%
AUTOMOBILE - 9.84% BCP Crystal US Holdings Corporation 550,920
American Tire Distributor 1,000,000 Capital Specialty Plastics, Inc. 447,145
Ford Motor Credit Co. 1,536,683 Koppers, Inc. 517,545
Fuel Systems Holding Corporation 2,980,006 Nalco Co. 512,500
General Motors Acceptance Corporation 1,283,026 Nova Chemicals Corporation 472,625
General Motors Corporation 900,000 P Q Corporation 1,111,000
Goodyear Tire & Rubber Co. 1,464,750 --------------
Jason, Inc. 1,780,340 3,611,735
LIH Investors, L.P. 1,922,500 --------------
Metaldyne Corporation 1,232,063 CONSUMER PRODUCTS - 9.32%
Nyloncraft, Inc. 1,521,875 Aero Holdings, Inc. 3,078,484
Ontario Drive & Gear Ltd. 2,798,731 ALH Fin LLC/ALH Fin Corporation 1,446,375
Qualis Automotive LLC 2,025,007 Augusta Sportswear Holding Co. 3,119,144
Tenneco, Inc. 1,042,500 Bravo Sports Holding Corporation 2,411,679
Titan International, Inc. 154,313 G F S I, Inc. 742,500
Transtar Holding Company 2,625,174 K N B Holdings Corporation 2,550,249
United Components, Inc. 1,117,800 Momentum Holding Co. 1,277,369
-------------- R A J Manufacturing Holdings LLC 2,541,382
25,384,768 Royal Baths Manufacturing Company 1,275,000
-------------- The Tranzonic Companies 3,082,803
BEVERAGE, DRUG & FOOD - 5.73% Walls Industries, Inc. 2,519,211
Aramark Corporation 412,750 Winsloew Furniture, Inc. --
Beta Brands Ltd. -- --------------
Cains Foods, L.P. 308,863 24,044,196
Dave and Buster's, Inc. 1,530,000 --------------
Del Monte Corporation 234,000 CONTAINERS, PACKAGING & GLASS - 5.72%
Eagle Pack Pet Foods, Inc. 1,623,437 Flutes, Inc. 1,580,839
Land O'Lakes, Inc. 795,000 Maverick Acquisition Company 1,054,220
Nonni's Food Company 2,513,682 P I I Holding Corporation 2,630,103
PepsiAmericas, Inc. 2,056,676 Packaging Dynamics Corporation of America 1,287,500
Pinnacle Foods Group 489,398 Paradigm Packaging, Inc. 2,484,490
River Ranch Fresh Foods LLC 1,615,001 Pliant Corporation 999,896
Sbarro, Inc. 1,040,000 Pregis Corporation 1,100,000
Specialty Foods Group, Inc. -- Tekni-Plex, Inc. 1,585,000
Vitality Foodservice, Inc. 2,164,198 Vitex Packaging, Inc. 2,040,174
-------------- --------------
14,783,005 14,762,222
-------------- --------------
BROADCASTING & ENTERTAINMENT - 2.63% DISTRIBUTION - 3.93%
CCH I Holdings LLC 1,870,000 Affina Group, Inc. 1,025,150
Cablevision Systems Corporation 1,015,000 Duncan Systems, Inc. 1,537,003
Cenveo Corporation 1,078,000 Kele and Associates, Inc. 2,871,312
Citadel Broadcasting Corporation 593,250 Magnatech International, Inc. 1,955,481
Charter Communications Op LLC 260,313 O R S Nasco Holding, Inc. 2,751,672
Liberty Media Corporation 958,770 QualServ Corporation --
Mediacom Broadband LLC 1,022,500 Strategic Equipment & Supply Corporation, Inc. --
-------------- --------------
6,797,833 10,140,618
-------------- --------------
------------------------------------------------------------------------------------------------------------------------------------
26
CONSOLIDATED SCHEDULE OF INVESTMENTS (CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Fair Value/ Fair Value/
INDUSTRY CLASSIFICATION: (Cont.) Market Value Market Value
-------------- --------------
DIVERSIFIED/CONGLOMERATE, HEALTHCARE, EDUCATION &
MANUFACTURING - 7.92% CHILDCARE - 3.65%
Activant Solutions, Inc. $ 147,750 A T I Acquisition Company $ 2,140,402
AmerCable, Inc. 1,660,953 American Hospice Management Holding LLC 2,557,481
Arrow Tru-Line Holdings, Inc. 2,199,226 F H S Holdings LLC 2,676,779
Bombardier, Inc. 950,000 H C A, Inc. 1,051,781
Coining Corporation of America LLC 2,674,835 MedAssist, Inc. 484,164
Dexter Magnetics Technologies, Inc. 1,429,484 Tenet Healthcare Corporation 505,000
Douglas Dynamics LLC 585,900 --------------
Evans Consoles, Inc. -- 9,415,607
Postle Aluminum Company LLC 2,536,437 --------------
Radiac Abrasives, Inc. 2,590,199 HOME & OFFICE FURNISHINGS, HOUSEWARES,
Trimas Corporation 1,063,669 AND DURABLE CONSUMER PRODUCTS - 6.54%
Truck Bodies & Equipment International 4,584,887 Connor Sport Court International, Inc. 1,000,561
-------------- H M Holding Company 2,318,903
20,423,340 Home Decor Holding Company 2,426,471
Justrite Manufacturing Acquisition Co. 1,727,199
DIVERSIFIED/CONGLOMERATE, Monessen Holding Corporation 2,425,013
SERVICE - 3.67% Stanton Carpet Holding Co. 2,523,685
Allied Waste NA 1,037,500 U-Line Corporation 2,584,710
CapeSuccess LLC 5,862 Wellborn Forest Holding Co. 1,864,289
Chemed Corporation 1,170,000 --------------
Diversco, Inc./DHI Holdings, Inc. -- 16,870,831
Dwyer Group, Inc. 1,147,074 --------------
Fowler Holding, Inc. 2,563,180 LEISURE, AMUSEMENT,
Interline Brands, Inc. 335,563 ENTERTAINMENT - 4.01%
Iron Mountain, Inc. 1,144,875 A M C Entertainment, Inc. 928,080
Mac-Gray Corporation 612,000 Bally Total Fitness Holding Corporation 109,379
Moss, Inc. 437,659 Keepsake Quilting, Inc. 1,464,744
Service Corporation International 1,007,500 M G M Mirage, Inc. 375,469
-------------- Majestic Star Casino LLC 524,375
9,461,213 O E D Corp/Diamond Jo Company Guarantee 992,500
-------------- Overton's Holding Company 1,906,193
ELECTRONICS - 2.68% Savage Sports Holding, Inc. 2,316,875
Calpine Corporation 532,500 Tunica-Biloxi Gaming Authority 1,062,500
Connecticut Electric, Inc. 2,617,668 Universal City Florida 412,500
Directed Electronics, Inc. 3,365,790 Warner Music Group Corporation 261,938
Flextronics International Ltd. 396,000 --------------
-------------- 10,354,553
6,911,958 --------------
-------------- MACHINERY - 9.76%
FARMING & AGRICULTURE - 0.00% Davis-Standard LLC 2,529,428
Protein Genetics, Inc. -- Hawk Precision Components Group, Inc. 2,461,106
-------------- Integration Technology Systems, Inc. 1,248,333
FINANCIAL SERVICES - 0.58% Manitowoc Company, Inc. 204,000
Hawker Beechcraft Acquisition Co. 52,250 Maxon Corporation 3,792,140
Highgate Capital LLC -- Morton Industrial Group, Inc. 2,546,765
Lazard LLC 790,713 Navis Global 2,513,797
Leucadia National Corporation 653,250 Safety Speed Cut Manufacturing Company, Inc. 2,433,659
Victory Ventures LLC -- Stanadyne Corporation 1,545,000
-------------- Stewart & Stevenson LLC 1,571,250
1,496,213 Supreme Industries, Inc. 676,968
-------------- Synventive Equity LLC 33,459
Tronair, Inc. 3,621,214
--------------
25,177,119
--------------
------------------------------------------------------------------------------------------------------------------------------------
27
CONSOLIDATED SCHEDULE OF INVESTMENTS (CONT.) MASSMUTUAL CORPORATE INVESTORS
March 31, 2007
(Unaudited)
Fair Value/ Fair Value/
INDUSTRY CLASSIFICATION: (Cont.) Market Value Market Value
-------------- --------------
MEDICAL DEVICES/BIOTECH - 2.48% RETAIL STORES - 3.66%
Coeur, Inc. $ 1,439,600 Blockbuster, Inc. $ 479,750
E X C Acquisition Corporation 154,550 Insurance Auto Auctions, Inc. 1,155,000
MicroGroup, Inc. 3,280,842 Neiman Marcus Group, Inc. 1,393,750
OakRiver Technology, Inc. 1,524,876 Olympic Sales, Inc. 3,802,032
-------------- Rent-A-Center, Inc. 403,000
6,399,868 Rental Service Corporation 1,065,000
-------------- United Rentals, Inc. 1,140,938
MINING, STEEL, IRON & NON PRECIOUS --------------
METALS - 0.85% 9,439,470
Freeport-McMoran Copper & Gold 416,280 --------------
Steel Dynamics, Inc. 200,500 TECHNOLOGY - 0.07%
Tube City IMS Corporation 650,000 Unisys Corporation 190,475
U S S Holdings, Inc. 933,236 --------------
-------------- 190,475
2,200,016 --------------
-------------- TELECOMMUNICATIONS - 3.34%
NATURAL RESOURCES - 0.19% Alamosa Deleware, Inc. 770,911
Appleton Papers, Inc. 308,250 Cincinnati Bell, Inc. 1,124,750
Rock-Tenn Co. 185,500 DeltaCom, Inc. 2,960,354
-------------- Hawaiian Telecom Communications 1,560,375
493,750 Jordan Telecom Products --
-------------- NTL Cable PLC 1,033,900
OIL AND GAS - 2.86% Stratos Global 613,813
Atlas Pipeline Partners 206,000 Triton P C S, Inc. 566,500
Basic Energy Services 219,375 --------------
Brigham Exploration Co. 707,000 8,630,603
Chaparral Energy, Inc. 1,507,500 --------------
Clayton Williams Energy, Inc. 752,000 TRANSPORTATION - 2.13%
GulfMark Offshore, Inc. 573,475 NABCO, Inc. 1,168,750
North American Energy Partners 408,000 Quality Distribution LLC 1,317,050
Offshore Logistics, Inc. 428,625 Tangent Rail Corporation 3,007,482
Quicksilver Resources, Inc. 492,500 --------------
Tennessee Gas Pipeline Co. 534,035 5,493,282
Total Equipment & Service, Inc. 1,545,947 --------------
-------------- UTILITIES - 1.83%
7,374,457 Dynegy Holdings, Inc. 844,450
-------------- Edison Mission Energy 57,338
PHARMACEUTICALS - 1.07% Inergy LP 157,500
CorePharma LLC 2,645,242 Markwest Energy Operating Co. 751,750
Enzymatic Therapy, Inc. 106,250 N R G Energy, Inc. 179,813
-------------- Pacific Energy Partners 672,153
2,751,492 Petrohawk Energy Corporation 1,065,000
-------------- Sierra Pacific Resources 648,209
PUBLISHING/PRINTING - 1.54% Tenaska Alabama Partners LP 344,884
Idearc, Inc. 617,250 --------------
Newark Group, Inc. 886,125 4,721,097
Primedia, Inc. 1,035,000 --------------
Sheridan Acquisition Corporation 392,344 WASTE MANAGEMENT / POLLUTION - 1.58%
Vertis, Inc. 1,040,300 Terra Renewal Services, Inc. 2,922,705
-------------- Waste Services, Inc. 1,152,250
3,971,019 --------------
-------------- 4,074,955
--------------
Total Corporate Restricted and
Public Securities - 104.00% $ 268,315,585
==============
See Notes to Consolidated Financial Statements.
------------------------------------------------------------------------------------------------------------------------------------
28
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MASSMUTUAL CORPORATE INVESTORS
(Unaudited)
1. HISTORY
MassMutual Corporate Investors (the "Trust") commenced operations in 1971 as
a Delaware corporation. Pursuant to an Agreement and Plan of Reorganization
dated November 14, 1985, approved by shareholders, the Trust was reorganized
as a Massachusetts business trust under the laws of the Commonwealth of
Massachusetts, effective November 28, 1985.
The Trust is a diversified closed-end management investment company. Babson
Capital Management LLC ("Babson Capital"), a wholly-owned indirect subsidiary
of Massachusetts Mutual Life Insurance Company ("MassMutual"), acts as its
investment adviser. The Trust's investment objective is to maintain a
portfolio of securities providing a fixed yield while providing an
opportunity for capital gains by investing primarily in a portfolio of
privately placed below investment grade, long term corporate debt obligations
with equity features, such as warrants, conversions rights, or other equity
features and, occasionally, preferred stocks, purchased directly from their
issuers.
On January 27,1998, the Board of Trustees authorized the formation of a
wholly-owned subsidiary ("MMCI Subsidiary Trust") for the purpose of holding
certain investments. The results of MMCI Subsidiary Trust have been included
in the accompanying consolidated financial statements. Footnote 2.D below
discusses the Federal tax consequences of the MMCI Subsidiary Trust.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
consistently by the Trust in the preparation of the consolidated financial
statements in conformity with accounting principles generally accepted in the
United States of America.
A. VALUATION OF INVESTMENTS:
Valuation of a security in the Trust's portfolio is made on the basis of
market price whenever market quotations are readily available and all
securities of the same class held by the Trust can be readily sold in such
market.
Nearly all securities which are acquired by the Trust directly from the
issuers and shares into which such securities may be converted or which may
be purchased on the exercise of warrants attached to such securities will be
subject to legal or contractual delays in, or restrictions on, resale and
will therefore be "restricted securities." Generally speaking, as contrasted
with open-market sales of unrestricted securities which may be effected
immediately if the market is adequate, absent an exemption from registration,
restricted securities can be sold only in a public offering for which a
registration statement is in effect under the Securities Act of 1933, as
amended (the "1933 Act").
The value of restricted securities, and of any other assets for which there
are no reliable market quotations, is the fair value as determined in good
faith by the Trust's Board of Trustees (the "Trustees"). Each restricted
security is valued by the Trustees at the time of the acquisition thereof and
at least quarterly thereafter. The Trustees have established guidelines to
aid in the valuation of each security. Generally, restricted securities are
initially valued at cost or less at the time of acquisition by the Trust.
Values greater or less than cost are used thereafter for restricted
securities in appropriate circumstances. Among the factors ordinarily
considered are the existence of restrictions upon the sale of the security by
the Trust; an estimate of the existence and extent of a market for the
security; the extent of any discount at which the security was acquired; the
estimated period of time during which the security will not be freely
marketable; the estimated expenses of registering or otherwise qualifying the
security for public sale; estimated underwriting commissions if underwriting
would be required to effect a sale; in the case of a convertible security,
whether or not it would trade on the basis of its stock equivalent; in the
case of a debt obligation which would trade independently of any equity
equivalent, the current yields on comparable securities; the estimated amount
of the floating supply of such securities available for purchase; the
proportion of the issue held by the Trust; changes in the financial condition
and prospects of the issuer; the existence of merger proposals or tender
offers affecting the issuer; and any other factors affecting fair value, all
in accordance with the Investment Company Act of 1940, as amended (the "1940
Act"). In making valuations, opinions of counsel may be relied upon as to
whether or not securities are restricted securities and as to the legal
requirements for public sale.
When market quotations are readily available for unrestricted securities of
an issuer, restricted securities of the same class are generally valued at a
discount from the market price of such unrestricted securities. The Trustees,
however, consider all factors in fixing any discount, including the filing of
a registration statement for such securities under the 1933 Act and any other
developments which are likely to increase the probability that the securities
may be publicly sold by the Trust without restriction.
The Trustee's meet at least once each quarter to approve the value of the
Trust's portfolio securities as of the close of business on the last business
day of the preceding quarter. This valuation requires the approval of a
majority of the Trustees of the Trust, including a majority of the Trustees
who are not interested persons of the Trust or of Babson Capital. In making
valuations, the Trustees will consider reports by
--------------------------------------------------------------------------------
29
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MASSMUTUAL CORPORATE INVESTORS
(CONTINUED)
Babson Capital analyzing each portfolio security in accordance with the
relevant factors referred to above. Babson Capital has agreed to provide such
reports to the Trust at least quarterly.
The consolidated financial statements include private placement restricted
securities valued at $181,395,519 (70.31% of net assets) as of March 31, 2007
whose values have been estimated by the Trustees in the absence of readily
ascertainable market values. Due to the inherent uncertainty of valuation,
those estimated values may differ significantly from the values that would
have been used had a ready market for the securities existed, and the
differences could be material.
The values for Rule 144A restricted securities and corporate public
securities are stated at the last reported sales price or at prices based
upon quotations obtained from brokers and dealers as of March 31, 2007,
subject to discount where appropriate, and are approved by the Trustees.
Short-term securities with more than sixty days to maturity are valued at
fair value and short-term securities having a maturity of sixty days or less
are valued at amortized cost which approximates market value.
B. ACCOUNTING FOR INVESTMENTS:
Investment transactions are accounted for on the trade date. Dividend income
is recorded on the ex-dividend date. Interest income is recorded on the
accrual basis, including the amortization of premiums and accretion of
discounts on bonds held using the yield-to-maturity method. The Trust does
not accrue income when payment is delinquent and when management believes
payment is questionable.
Realized gains and losses on investment transactions and unrealized
appreciation and depreciation of investments are reported for financial
statement and federal income tax purposes on the identified cost method.
C. USE OF ESTIMATES:
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from
those estimates.
D. FEDERAL INCOME TAXES:
The Trust has elected to be taxed as a "regulated investment company" under
the Internal Revenue Code and intends to maintain this qualification and to
distribute substantially all of its net taxable income to its shareholders.
In any year when net long-term capital gains are realized by the Trust,
management, after evaluating the prevailing economic conditions, will
recommend to the Trustees either to designate the net realized long-term
gains as undistributed and pay the federal capital gains taxes thereon or to
distribute all or a portion of such net gains.
The Trust is taxed as a regulated investment company and is therefore limited
as to the amount of non-qualified income that it may receive as the result of
operating a trade or business, e.g. the Trust's pro rata share of income
allocable to the Trust by a partnership operating company. The Trust's
violation of this limitation could result in the loss of its status as a
regulated investment company, thereby subjecting all of its net income and
capital gains to corporate taxes prior to distribution to its shareholders.
The Trust, from time-to-time, identifies investment opportunities in the
securities of entities that could cause such trade or business income to be
allocable to the Trust. The MMCI Subsidiary Trust (described in Footnote 1,
above) was formed in order to allow investment in such securities without
adversely affecting the Trust's status as a regulated investment company.
The MMCI Subsidiary Trust is not taxed as a regulated investment company.
Accordingly, prior to the Trust receiving any distributions from the MMCI
Subsidiary Trust, all of the MMCI Subsidiary Trust's taxable income and
realized gains, including non-qualified income and realized gains, is subject
to taxation at prevailing corporate tax rates. For the three months ended
March 31, 2007, the MMCI Subsidiary Trust has accrued income tax expense on
net realized gains of $8,531 and reduced deferred income tax expenses on net
unrealized gains by $219,474.
In June 2006, the Financial Accounting Standards Board ("FASB") issued FASB
Interpretation No. 48, Accounting for Uncertainty in Income Taxes - an
interpretation of FASB statement 109 ("FIN 48"). FIN 48 supplements FASB 109
by prescribing a recognition threshold and measurement attribute for the
financial statement recognition and measurement of a tax position taken or
expected to be taken in a tax return. The adoption of FIN 48 requires
financial statements to be adjusted to reflect only those tax positions that
are more likely than not to be sustained as of the adoption date. As of March
31, 2007, the Trust has properly recorded all tax liabilities.
E. DISTRIBUTIONS TO SHAREHOLDERS:
The Trust records distributions to shareholders from net investment income
and net realized gains, if any, on the exdividend date. The Trust's net
investment income dividend is declared four times per year, in April, July,
October, and
--------------------------------------------------------------------------------
30
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MASSMUTUAL CORPORATE INVESTORS
(CONTINUED)
December. The Trust's net realized capital gain distribution, if any, is
declared in December.
F. EXPENSE REDUCTION:
Citibank, N.A. ("Citibank") serves as custodian to the Trust. Pursuant to the
custodian agreements, Citibank receives a fee reduced by credits on cash
balances the Trust maintains with Citibank. All credit balances, if any, used
to reduce the Trust's custodian fees are reported as fees paid indirectly on
the Statement of Operations. For the three months ended March 31, 2007, there
were no credit balances used to reduce custodian fees.
3. INVESTMENT SERVICES CONTRACT
A. NEW INVESTMENT SERVICES CONTRACT:
An Investment Services Contract between the Trust and Babson Capital,
effective October 1, 2005 (the "New Contract"), provides for a quarterly
investment advisory fee of 0.3125% of the net asset value of the Trust each
quarter, which is approximately equal to 1.25% annually, with no performance
adjustment. The New Contract provides that for its first eighteen months, the
investment advisory fee cannot exceed the amount that Babson Capital would
have been paid under the prior Investment Services Contract with the Trust
dated July 1, 1988 (the "Prior Contract").
B. SERVICES:
Under the New Contract with the Trust, Babson Capital agrees to use its best
efforts to present to the Trust a continuing and suitable investment program
consistent with the investment objectives and policies of the Trust. Babson
Capital represents the Trust in any negotiations with issuers, investment
banking firms, securities brokers or dealers and other institutions or
investors relating to the Trust's investments. Under the New Contract, Babson
Capital provides administration of the day-to-day operations of the Trust and
provides the Trust with office space and office equipment, accounting and
bookkeeping services, and necessary executive, clerical and secretarial
personnel for the performance of the foregoing services.
C. PRIOR INVESTMENT SERVICES CONTRACT ADVISORY FEE:
Under the Prior Contract, the Trust paid Babson Capital a quarterly base rate
(the "Base Fee Rate") of 5/16 of 1% of the value of the Trust's net assets as
of the end of each fiscal quarter, approximately equivalent to 1.25% of the
net asset value of the Trust on an annual basis, plus or minus a quarterly
performance adjustment (the "Performance Adjustment") of up to 1/16 of 1% of
net asset value, approximately equivalent to plus or minus 0.25% on an annual
basis.
The Performance Adjustment was based on the Trust's performance as compared
to a benchmark rate of return (the "Target Rate") equal to 5.0 percentage
points plus an unweighted, arithmetic average of the rates of return of the
Standard & Poor's Industrials Composite (formerly called the Standard &
Poor's Industrial Price Index) and the Lehman Brothers Intermediate U.S.
Credit Index (formerly called the Lehman Brothers Corporate Bond Index) over
a rolling three-year period (the "Measurement Period") comprising the twelve
quarters ending on the last day of each quarter (the "Valuation Date"). The
Standard & Poor's Industrials Composite is not readily available to the
public. Babson Capital obtained the information for this index from Factset
Research Systems. The three-year annualized return for the Standard & Poor's
Industrials Composite for the period ended March 31, 2007 was 9.73%. Under
the prior contract, the Performance Adjustment was equal to 5% of the
difference between the Trust's actual rate of return over the Measurement
Period and the Target Rate. If the Trust's actual rate of return exceeded the
Target Rate, the Base Fee Rate increased by an amount equal to the
Performance Adjustment; if the Trust's actual rate of return was less than
the Target Rate, the Base Fee Rate was reduced by the Performance Adjustment.
Under the Prior Contract, the investment advisory fee payable by the Trust
was equal to the Base Fee Rate (as adjusted by the Performance Adjustment)
times the net asset value of the Trust as of the Valuation Date.
Additionally, Babson Capital agreed to waive, for each quarter beginning July
1, 2004, the amount, if any, by which the investment advisory fee calculated
in the manner described in the Prior Contract exceeded the sum of (i) 5/16 of
1% times the ending net asset value for that quarter plus or minus (ii) the
Performance Adjustment applied against the average quarter end net assets for
the Trust for the twelve-quarter period ending on such quarter.
4. SENIOR SECURED INDEBTEDNESS
A. NOTE PAYABLE:
MassMutual holds the Trust's $20,000,000 Senior Fixed Rate Convertible Note
(the "Note") issued by the Trust in 1995. The Note, as amended, is due
November 15, 2007 and accrues at 7.39% per annum. MassMutual, at its option,
can convert the principal amount of the Note into common shares. The dollar
amount of principal would be converted into an equivalent dollar amount of
common shares based upon the average price of the common shares for ten
business days prior to the notice of conversion. For the three months ended
March 31, 2007, the Trust incurred total interest expense on the Note of
$369,500.
The Trust may redeem the Note, in whole or in part, at the principal amount
proposed to be redeemed together with the accrued and unpaid interest thereon
through the redemption
--------------------------------------------------------------------------------
31
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MASSMUTUAL CORPORATE INVESTORS
(CONTINUED)
date plus the Make Whole Premium. The Make Whole Premium equals the excess of
(i) the present value of the scheduled payments of principal and interest
which the Trust would have paid but for the proposed redemption, discounted
at the rate of interest of U.S. Treasury obligations whose maturity
approximates that of the Note plus 0.50% over (ii) the principal of the Note
proposed to be redeemed.
B. REVOLVING CREDIT AGREEMENT:
The Trust entered into a Revolving Credit Agreement (the "Revolver") with The
Royal Bank of Scotland PLC as of May 31, 2005 (the "Agent Bank"), in the
principal amount of $25,000,000, maturing May 31, 2008. The Revolver bears
interest payable in arrears at a per annum rate that varies depending upon
whether the Trust requests a Base Rate Loan or LIBOR Rate Loan. Interest on
Base Rate Loans equals the higher of: (i) the annual "Base Rate" as set
periodically by the Agent Bank and (ii) the most recent Federal Funds
Effective Rate plus .50% per annum. Per annum interest on LIBOR Rate Loans
equals .37% plus the London Inter Bank Offered Rate ("LIBOR") rate, divided
by 1 minus the LIBOR Reserve Rate. The Trust also incurs expense on the
undrawn portion of the total Revolver at a rate of .15% per annum.
As of March 31, 2007, there was no outstanding amount against the Revolver.
For the three months ended March 31, 2007, the Trust incurred total expense
on the Revolver of $9,247 related to the undrawn portion.
5. PURCHASES AND SALES OF INVESTMENTS
FOR THE THREE MONTHS
ENDED 3/31/2007
COST OF PROCEEDS FROM
INVESTMENTS SALES OR
ACQUIRED MATURITIES
-------- ----------
Corporate restricted securities $17,668,491 $ 6,450,984
Corporate public securities 8,369,767 21,852,683
The aggregate cost of investments is substantially the same for financial
reporting and federal income tax purposes as of March 31, 2007. The net
unrealized appreciation of investments for financial reporting and federal
tax purposes as of March 31, 2007 is $4,054,254 and consists of $27,948,172
appreciation and $23,893,918 depreciation.
Net unrealized appreciation of investments on the Statement of Assets and
Liabilities reflects the balance of a deferred tax accrual of $431,544 on net
unrealized gains on the MMCI Subsidiary Trust.
6. NEW ACCOUNTING PRONOUNCEMENTS
In September 2006, FASB issued Statement of Financial Accounting Standards
No. 157, Fair Value Measurements ("FAS 157"). FAS 157 establishes a single
authoritative definition of fair value, establishes a framework for measuring
fair value and expands disclosures about fair value measurements. FAS 157
applies to fair value measurements already required or permitted by existing
standards. The change to current generally accepted accounting principles
from the application of FAS 157 relates to the definition of fair value, the
methods used to measure fair value, and the expanded disclosures about fair
value measurements. Management of the Trust does not believe the adoption of
FAS 157 will materially impact the financial statement amounts, however,
additional disclosures may be required about the inputs used to develop the
measurements and the effect of certain of the measurements on changes in net
assets for the period. FAS 157 is effective for financial statements issued
for fiscal years beginning after November 15, 2007 and interim periods within
those fiscal years.
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32
TRUSTEES OFFICERS
William J. Barrett Roger W. Crandall Chairman
Donald E. Benson* Clifford M. Noreen President
Michael H. Brown James M. Roy Vice President &
Chief Financial Officer
Roger W. Crandall
Rodney J. Dillman Vice President &
Donald Glickman Secretary
Martin T. Hart* Jill A. Fields Vice President
Robert E. Joyal Michael P. Hermsen Vice President
Corine T. Norgaard* Mary Wilson Kibbe Vice President
Michael L. Klofas Vice President
Richard E. Spencer, II Vice President
* MEMBER OF THE AUDIT Ronald S. Talala Treasurer
COMMITTEE
John T. Davitt, Jr. Comptroller
Melissa M. LaGrant Chief Compliance
Officer
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DIVIDEND REINVESTMENT AND SHARE PURCHASE PLAN
MassMutual Corporate Investors offers a Dividend Reinvestment and Share Purchase
Plan. The Plan provides a simple way for shareholders to add to their holdings
in the Trust through the receipt of dividend shares issued by the Trust or
through the reinvestment of cash dividends in Trust shares purchased in the open
market. A shareholder may join the Plan by filling out and mailing an
authorization card to Shareholder Financial Services, Inc., the Transfer Agent.
Participating shareholders will continue to participate until they notify the
Transfer Agent, in writing, of their desire to terminate participation. Unless a
shareholder elects to participate in the Plan, he or she will, in effect, have
elected to receive dividends and distributions in cash.
Participating shareholders may also make additional contributions to the Plan
from their own funds. Such contributions may be made by personal check or other
means in an amount not less than $10 nor more than $5,000 per quarter. Cash
contributions must be received by the Transfer Agent at least five days (but no
more than 30 days) before the payment date of a dividend or distributions.
Whenever the Trust declares a dividend payable in cash or shares, the Transfer
Agent, acting on behalf of each participating shareholder, will take the
dividend in shares only if the net asset value is lower than the market price
plus an estimated brokerage commission as of the close of business on the
valuation day. The valuation day is the last day preceding the day of dividend
payment. When the dividend is to be taken in shares, the number of shares to be
received is determined by dividing the cash dividend by the net asset value as
of the close of business on the valuation date or, if greater than net asset
value, 95% of the closing share price. If the net asset value of the shares is
higher than the market value plus an estimated commission, the Transfer Agent,
consistent with obtaining the best price and execution, will buy shares on the
open market at current prices promptly after the dividend payment date.
The reinvestment of dividends does not, in any way, relieve participating
shareholders of any federal, state or local tax. For federal income tax
purposes, the amount reportable in respect of a dividend received in
newly-issued shares of the Trust will be the fair market value of the shares
received, which will be reportable as ordinary income and/or capital gains.
As compensation for its services, the Transfer Agent receives a fee of 5% of any
dividend and cash contribution (in no event in excess of $2.50 per distribution
per shareholder.)
Any questions regarding the Plan should be addressed to Shareholder Financial
Services, Inc., Agent for MassMutual Corporate Investors' Dividend Reinvestment
and Share Purchase Plan, P.O. Box 173673, Denver CO 80217-3673.
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