Investment Income

The Company’s investment portfolio generates interest, dividends, loan fees, and profit upon sale. The Company records these on an accrual basis, recognizing income as earned in accordance with the contractual terms of the loan agreement, to the extent that such amounts are expected to be collected.

Realized gains or losses from the repayment or sale of investments are calculated using the trade date. The Company reports changes in fair value of investments from the prior period as a component of "Net change in unrealized gain (loss) on investments" on the Consolidated Statements of Operations.

Fee Sharing

These are profit-sharing payments to the Participation Capital investor.

Professional & Legal Fees

These include payments to Growth Lending LLC under the Administration Agreement, payments to James Hickey, and third parties, including accountants and lawyers.

Other Assets

Other Assets are primarily legal expenses from the bank line of credit and are amortized over the life of the facility.

Other Current Payables

This is amounts owed under Fee Sharing.

Valuation of Portfolio Investments

The Company shall value the investments owned by the Company, subject at all times to the oversight of the Company's Board of Directors (the “Board”). The Company shall follow its own written valuation policies and procedures as approved by the Board when determining valuations. A short summary of the valuation policies is below.

Investments for which market quotations are readily available are typically valued at such market quotations. Pursuant to Rule 2a-5 under the 1940 Act, the Board designated James Hickey as Valuation Designee to perform fair value determinations for the Company for investments that do not have readily available market quotations. Market quotations are obtained from an independent pricing service, where available. If a price cannot be obtained from an independent pricing service or if the independent pricing service is not deemed to be current with the market, certain investments held by the Company will be valued on the basis of prices provided by principal market makers. Generally, investments marked in this manner will be marked at the mean of the bid and ask of the independent broker quotes obtained. To validate market quotations, the Company utilizes a number of factors to determine if the quotations are representative of fair value, including the source and number of quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available will be valued at a price that reflects such securities’ fair value.

With respect to unquoted portfolio investments, the Company will value each investment considering, among other measures, discounted cash flow models, comparable company multiple models, comparisons of financial ratios of peer companies that are public, and other factors. When an external event, such as a purchase transaction, public offering, or subsequent equity sale occurs, the Company will use the pricing indicated by the external event to corroborate and/or assist us in its valuation. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of our investments may differ significantly from the values that would have been used had a readily available market value existed for such investments, and the differences could be material.

The Company applies ASC Topic 820, Fair Value Measurement (“ASC 820”), which establishes a framework for measuring fair value in accordance with US GAAP and required disclosures of fair value measurements. The fair value of a financial instrument is the amount that would be received in an orderly transaction between market participants at the measurement date. The Company determines the fair value of investments consistent with its valuation policy. The Company discloses the fair value of its investments in a hierarchy that prioritizes and ranks the level of market observability used in the determination of fair value. In accordance with ASC 820, these levels are summarized below:

·Level 1 — Valuations based on quoted prices (unadjusted) in active markets for identical assets or liabilities at the measurement date. 

·Level 2 — Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. 

·Level 3 — Valuations based on inputs that are unobservable and significant to the fair value measurement. 

As a generalization, for debt, investments purchased at par will be valued par plus any accrued interest, fees, and dividend unless there is reason to believe the portfolio company is impaired or at risk of being impaired and unable to pay the contractually required payments. In cases where the Company has a preset sale price and the sale is anticipated in the near future, the investment is valued at the preset sale price.

The fair value assigned to these investments is based upon available information and may fluctuate from period to period. In addition, it does not necessarily represent the amount that might ultimately be realized upon sale. Due to inherent uncertainty of valuation, the estimated fair value of investments may differ from the value that would have been used had a ready market for the security existed, and the difference could be material.