v3.25.1
Borrowings
 3 Months Ended
Mar. 31, 2025
Debt Disclosure [Abstract]  
Borrowings Borrowings
The following table shows the Company’s outstanding debt as of March 31, 2025 and December 31, 2024:
Liability
(in thousands)		March 31, 2025December 31, 2024
Total CommitmentBalance OutstandingUnused CommitmentTotal CommitmentBalance OutstandingUnused Commitment
Revolving Credit Facility$300,000 $5,000 $295,000 $300,000 $5,000 $295,000 
2025 Notes— — — 70,000 70,000 — 
2026 Notes200,000 200,000 — 200,000 200,000 — 
2027 Notes125,000 125,000 — 125,000 125,000 — 
2028 Notes50,000 50,000 — — — — 
Total before deferred financing and issuance costs675,000 380,000 295,000 695,000 400,000 295,000 
Unamortized deferred financing and issuance costs— (5,112)— — (5,077)— 
Total borrowings outstanding, net of deferred financing and issuance costs$675,000 $374,888 $295,000 $695,000 $394,923 $295,000 
Interest expense on these borrowings includes the interest cost charged on borrowings, the unused fee on the Credit Facility (as defined below), paying and administrative agent fees, and the amortization of deferred Credit Facility fees and expenses and costs and fees relating to the Company’s unsecured notes outstanding. These expenses are shown in the table below:
Interest Expense and Amortization of Fees
(in thousands)		For the Three Months Ended March 31,
20252024
Revolving Credit Facility
Interest cost$98 $1,328 
Unused fee369 364 
Amortization of costs and other fees628 486 
Revolving Credit Facility Total$1,095 $2,178 
2025 Notes
Interest cost$674 $788 
Amortization of costs and other fees52 52 
2025 Notes Total$726 $840 
2026 Notes
Interest cost$2,250 $2,250 
Amortization of costs and other fees111 111 
2026 Notes Total$2,361 $2,361 
2027 Notes
Interest cost$1,562 $1,562 
Amortization of costs and other fees70 70 
2027 Notes Total$1,632 $1,632 
2028 Notes
Interest cost$529 $— 
Amortization of costs and other fees29 — 
2028 Notes Total$558 $— 
Total interest expense and amortization of fees$6,372 $7,011 
Credit Facility
In February 2014, the Company, along with its Financing Subsidiary as borrower, entered into a credit agreement with Deutsche Bank AG, New York Branch acting as administrative agent and the other lenders party thereto, which provided the Company with a $150.0 million commitment, subject to borrowing base requirements (as amended and restated from time to time, the “Credit Facility”). On July 22, 2022, the Credit Facility was amended to, among other things, extend the revolving period from November 30, 2022 to May 31, 2024 and the scheduled maturity date from May 31, 2024 to November 30, 2025 (unless otherwise terminated earlier pursuant to its terms), as well as change the floating rate from LIBOR to SOFR. On April 29, 2024, the Company and the Financing Subsidiary amended the Credit Facility to, among other things, extend the revolving period to August 31, 2024. On August 6, 2024, the Company and the Financing Subsidiary amended the Credit Facility to, among other things, (i) further extend the revolving period from August 31, 2024 to November 30, 2025, (ii) extend the scheduled maturity date from November 30, 2025 to May 30, 2027, (iii) adjust the advance rates based on the underlying asset type, (iv) revise certain events of default provisions and affirmative and negative covenants; and (v) reduce the total commitments to $300 million from $350 million. As of March 31, 2025, the Company had $300 million in total commitments available under the Credit Facility, which includes an accordion feature that allows the Company to increase the size of the Credit Facility to up to $400 million under certain circumstances.
As of March 31, 2025, borrowings under the Credit Facility bore interest at the sum of (i) a floating rate based on certain indices, including SOFR and commercial paper rates (subject to a floor of 0.50%), plus (ii) a margin of 3.20% if facility utilization is greater than or equal to 75%, 3.35% if utilization is greater than or equal to 50% but less than 75%, 3.50% if utilization is less than 50% and 4.5% during the amortization period. Borrowings under the Credit Facility are secured only by the assets of the Financing Subsidiary. The Company agreed to pay Deutsche Bank AG a syndication fee and to pay to Deutsche Bank AG a fee to act as administrative agent under the Credit Facility as well as to pay each lender (i) a commitment fee based on each lender’s commitment and (ii) a fee of 0.50% per annum for any unused borrowings under the Credit Facility on a monthly basis. The Credit Facility contains affirmative and restrictive covenants including, but not limited to, an advance rate of up to 50.0% of the applicable balance of net assets held by the Financing Subsidiary, maintenance of minimum net worth, a ratio of total assets to total indebtedness of not less than the greater of 3:2 and the amount so required under the 1940 Act, a key man clause relating to the Company’s Chief Executive Officer, James P. Labe, and the Company’s President and Chief Investment Officer, Sajal K. Srivastava, and eligibility requirements, including but not limited to geographic and industry concentration limitations and certain loan grade classifications. Furthermore, events of default under the Credit Facility include, among other things, (i) a payment default; (ii) a change of control; (iii) bankruptcy; (iv) a covenant default; and (v) failure by the Company to maintain its qualification as a BDC under the 1940 Act. As of March 31, 2025 and December 31, 2024, the Company was in compliance with all covenants under the Credit Facility.
As of March 31, 2025 and December 31, 2024, the Company had outstanding borrowings under the Credit Facility of $5.0 million and $5.0 million, respectively, excluding deferred credit facility costs of $3.5 million and $3.9 million, respectively, which is included in the Company’s consolidated statements of assets and liabilities. The book value of the Credit Facility approximates fair value due to the relatively short maturity, cash repayments and market interest rates of the instrument. The fair value of the Credit Facility would be categorized as Level 3 of the fair value hierarchy if determined as of the reporting date.
During the three months ended March 31, 2025 and 2024, the Company had average outstanding borrowings under the Credit Facility of $5.0 million and $61.7 million, respectively, at a weighted average interest rate, inclusive of unused fees, of 8.31% and 9.17%, respectively.
As of March 31, 2025 and December 31, 2024, $323.9 million and $332.0 million, respectively, of the Company’s assets, including restricted cash, were pledged for borrowings under the Credit Facility, leaving $410.9 million and $431.0 million of assets unencumbered, respectively.
2025 Notes
On March 19, 2020, the Company completed a private debt offering of $70.0 million in aggregate principal amount of its 4.50% unsecured notes due March 19, 2025 (the “2025 Notes”) in reliance on Section 4(a)(2) of the Securities Act. In March 2025, the Company repaid the full $70.0 million in aggregate principal amount of the issued and outstanding 2025 Notes at maturity at par value plus the accrued and unpaid interest. The interest on the 2025 Notes was payable semiannually on March 19 and September 19 each year.
The Master Note Purchase Agreement (the “Note Purchase Agreement”) under which the 2025 Notes were issued contains customary terms and conditions for unsecured notes issued in a private placement, including, without limitation, affirmative and negative covenants such as information reporting, maintenance of the Company’s status as a BDC within the meaning of the 1940 Act, a minimum asset coverage ratio of 1.50 to 1.00, a minimum interest coverage ratio of 1.25 to 1.00, and minimum stockholders’ equity of $216.1 million, as adjusted upward by an amount equal to 65% of the net proceeds from the issuance of shares of the Company’s common stock subsequent to December 31, 2019.
The Note Purchase Agreement also contains customary events of default with customary cure and notice periods, including, without limitation, nonpayment, incorrect representation in any material respect, breach of covenant, cross-default under other indebtedness of the Company or subsidiary guarantors, certain judgments and orders, certain events of bankruptcy, and breach of a key man clause relating to the Company’s Chief Executive Officer, James P. Labe, and the Company’s President and Chief Investment Officer, Sajal K. Srivastava.
As of March 31, 2025 and December 31, 2024, the fair value of the 2025 Notes was $0.0 million and $70.3 million, respectively, and would be categorized as Level 3 of the fair value hierarchy if determined as of the reporting date.

2026 Notes
On March 1, 2021, the Company completed a private debt offering of $200.0 million in aggregate principal amount of its 4.50% unsecured notes due March 1, 2026 (the “2026 Notes”) in reliance on Section 4(a)(2) of the Securities Act. The interest on the 2026 Notes is payable semiannually on March 19 and September 19 each year.
The 2026 Notes are governed by the terms of the First Supplement, dated as of March 1, 2021 (the “First Supplement”), to the Note Purchase Agreement. The 2026 Notes may be redeemed in whole or in part at any time or from time to time at the Company’s option at par plus accrued interest to the prepayment date and, if applicable, a make-whole premium. In addition, the Company is obligated to offer to prepay the 2026 Notes at par plus accrued and unpaid interest up to, but excluding, the date of prepayment, if certain change in control events occur. The 2026 Notes are general unsecured obligations of the Company that rank pari passu with all outstanding and future unsecured unsubordinated indebtedness issued by the Company; provided, however, in the event that the Company creates, incurs, assumes or permits to exist liens on or with respect to any of its property or assets in connection with future secured indebtedness of more than an aggregate principal amount of $25 million, the 2026 Notes will generally become secured concurrently therewith, equally and ratably with such indebtedness. In addition, in the event that a Below Investment Grade Event (as defined in the Note Purchase Agreement) occurs, the 2026 Notes will bear interest at a fixed rate of 5.50% per year from the date of the occurrence of the Below Investment Grade Event to and until the date on which the Below Investment Grade Event is no longer continuing. The other terms and conditions applicable to the 2026 Notes under the Note Purchase Agreement, as modified by the First Supplement, including events of default and affirmative and negative covenants, are substantially similar to the terms and conditions that were applicable to the 2025 Notes. As of March 31, 2025 and December 31, 2024, the Company was in compliance with all covenants under the 2026 Notes.
The 2026 Notes are recorded at amortized cost in the consolidated statements of assets and liabilities. Amortized cost includes $0.4 million of deferred issuance cost as of March 31, 2025, which is amortized and expensed over the five-year term of the 2026 Notes based on an effective yield method. As of March 31, 2025 and December 31, 2024, the fair value of the 2026 Notes was $195.2 million and $194.8 million, respectively, and would be categorized as Level 3 of the fair value hierarchy if determined as of the reporting date.
2027 Notes
On February 28, 2022, the Company completed a private debt offering of $125.0 million in aggregate principal amount of its 5.00% unsecured notes due February 28, 2027 (the “2027 Notes”) in reliance on Section 4(a)(2) of the Securities Act. The interest on the 2027 Notes is payable semiannually on February 28 and August 28 each year.
The 2027 Notes are governed by the terms of the Second Supplement, dated as of February 28, 2022 (the “Second Supplement”), to the Note Purchase Agreement. The 2027 Notes may be redeemed in whole or in part at any time or from time to time at the Company’s option at par plus accrued interest to the prepayment date and, if applicable, a make-whole premium. In addition, the Company is obligated to offer to prepay the 2027 Notes at par plus accrued and unpaid interest up to, but excluding, the date of prepayment, if certain change in control events occur. The 2027 Notes are general unsecured obligations of the Company that rank pari passu with all outstanding and future unsecured unsubordinated indebtedness issued by the Company; provided, however, in the event that the Company creates, incurs, assumes or permits to exist liens on or with respect to any of its property or assets in connection with future secured indebtedness of more than an aggregate principal amount of $25 million, the 2027 Notes will generally become secured concurrently therewith, equally and ratably with such indebtedness. In addition, in the event that a Below Investment Grade Event (as defined in the Note Purchase Agreement) occurs, the 2027 Notes will bear interest at a fixed rate of 6.00% per year from the date of the occurrence of the Below Investment Grade Event to and until the date on which the Below Investment Grade Event is no longer continuing. The other terms and conditions applicable to the 2027 Notes under the Note Purchase Agreement, as modified by the Second Supplement, including events of default and affirmative and negative covenants, are substantially similar to the terms and conditions that were applicable to the 2025 Notes and that are applicable to the 2026 Notes. As of March 31, 2025 and December 31, 2024, the Company was in compliance with all covenants under the 2027 Notes.
The 2027 Notes are recorded at amortized cost in the consolidated statements of assets and liabilities. Amortized cost includes $0.5 million of deferred issuance cost as of March 31, 2025, which is amortized and expensed over the five-year term of the 2027 Notes based on an effective yield method. As of March 31, 2025 and December 31, 2024, the fair value of the 2027 Notes was $119.9 million and $119.0 million, respectively, and would be categorized as Level 3 of the fair value hierarchy if determined as of the reporting date.
2028 Notes
On February 12, 2025, the Company completed a private debt offering of $50.0 million in aggregate principal amount of its 8.11% unsecured notes due February 12, 2028 (the “2028 Notes”) in reliance on Section 4(a)(2) of the Securities Act. The interest on the 2028 Notes is payable semiannually on February 12 and August 12 each year.
The 2028 Notes may be redeemed in whole or in part at any time or from time to time at the Company’s option at par plus accrued interest to the prepayment date and, if applicable, a make-whole premium. In addition, the Company is obligated to offer to prepay the 2028 Notes at par plus accrued and unpaid interest up to, but excluding, the date of prepayment, if certain change in control events occur. The 2028 Notes are general unsecured obligations of the Company that rank pari passu with all outstanding and future unsecured unsubordinated indebtedness issued by the Company; provided however, in the event that the Company creates, incurs, assumes or permits to exist liens on or with respect to any of its property or assets in connection with future secured indebtedness of more than an aggregate principal amount of $25 million, the 2028 Notes will generally become secured concurrently therewith, equally and ratably with such indebtedness.
The Note Purchase Agreement (the “2025 Note Purchase Agreement”) under which the 2028 Notes were issued contains customary terms and conditions for senior unsecured notes issued in a private placement, including, without limitation, affirmative and negative covenants such as information reporting, maintenance of the Company’s status as a BDC within the meaning of the 1940 Act and certain restrictions with respect to transactions with affiliates, fundamental changes, changes of line of business, permitted liens and restricted payments. In addition, the 2025 Note Purchase Agreement contains the following financial covenants: (1) a minimum asset coverage ratio of 1.50 to 1.00; (2) a minimum interest coverage ratio of 1.25 to 1.00; and (3) maintenance of minimum stockholders’ equity to not be less than (a) the higher of (i) $236,776,000 and (ii) an amount equal to 65% of the Company’s stockholders’ equity as of December 31, 2024, plus (b) 65% of the net proceeds from the sale of the Company’s equity interests after the relevant date. In addition, the stated interest rate on the 2028 Notes is subject to a step up of 1.00% per year, to the extent that (1) the 2028 Notes do not satisfy certain investment grade rating conditions and/or (2) the ratio of its payment-in-kind income to net investment income during a six-month period exceeds specified thresholds, measured as of each fiscal quarter end.
The 2025 Note Purchase Agreement also contains customary events of default with customary cure and notice periods, including, without limitation, nonpayment, incorrect representation in any material respect, breach of covenant, cross-default under other indebtedness of the Company or subsidiary guarantors, if any, certain judgements and orders, certain events of bankruptcy, and breach of a key man clause with respect to James P. Labe and Sajal K. Srivastava. As of March 31, 2025, the Company was in compliance with all covenants under the 2028 Notes.
The 2028 Notes are recorded at amortized cost in the consolidated statements of assets and liabilities. Amortized cost includes $0.7 million of deferred issuance cost as of March 31, 2025, which is amortized and expensed over the three-year term of the 2028 Notes based on an effective yield method. As of March 31, 2025, the fair value of the 2028 Notes was $51.2 million, and would be categorized as Level 3 of the fair value hierarchy if determined as of the reporting date.
The following table shows additional information about the level in the fair value hierarchy of the Company’s liabilities as of March 31, 2025 and December 31, 2024:
Liability
(in thousands)		March 31, 2025December 31, 2024
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Revolving Credit Facility$— $— $5,000 $5,000 $— $— $5,000 $5,000 
2025 Notes, net(1)
— — — — — — 70,269 70,269 
2026 Notes, net(2)
— — 194,766 194,766 — — 194,301 194,301 
2027 Notes, net(3)
— — 119,409 119,409 — — 118,425 118,425 
2028 Notes, net(4)
— — 50,559 50,559 — — — — 
Total$— $— $369,734 $369,734 $— $— $387,995 $387,995 
_______________
(1)Net of debt issuance costs as of December 31, 2024 of $0.1 million.
(2)Net of debt issuance costs as of March 31, 2025 and December 31, 2024 of $0.4 million and $0.5 million, respectively.
(3)Net of debt issuance costs as of March 31, 2025 and December 31, 2024 of $0.5 million and $0.6 million, respectively.
(4)Net of debt issuance costs as of March 31, 2025 of $0.7 million.