In accordance with the authoritative guidance on fair value measurements and disclosures under U.S. GAAP, the Company discloses the fair value of its investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The guidance establishes three levels of the fair value hierarchy as follows:

Level 1 — Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2 — Quoted prices in markets that are not considered to be active or financial instruments for which significant inputs are observable, either directly or indirectly;

Level 3 — Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

The level of an asset or liability within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires significant judgment by management.

The Company considers whether the volume and level of activity for the asset or liability have significantly decreased and identifies transactions that are not orderly in determining fair value. Accordingly, if the Company determines that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value. Valuation techniques such as an income approach might be appropriate to supplement or replace a market approach in those circumstances.

At March 31, 2023, the Company had investments in 88 portfolio companies. The total cost and fair value of the investments were $912,581,782 and $877,493,781, respectively. The composition of our investments as of March 31, 2023 is as follows:

(1)

Includes unitranche investments, which may combine characteristics of first lien senior secured, as well as second lien and/or subordinated loans. Our unitranche loans may expose us to certain risk associated with second lien and subordinated loans to the extent we invest in the “last-out” portion of the unitranche loans which account for 6.2% of our portfolio at fair value.

At December 31, 2022, the Company had investments in 85 portfolio companies. The total cost and fair value of the investments were $875,823,177 and $844,733,638, respectively. The composition of our investments as of December 31, 2022 was as follows:


	Cost		Fair Value
Senior Secured – First Lien⁽¹⁾	$	750,527,999	$	735,555,508
Senior Secured – Second Lien		69,989,477		45,304,300
Unsecured Debt		5,657,964		4,823,898
Equity		49,647,737		59,049,932
Total Investments	$	875,823,177	$	844,733,638

(1)

The Company’s investment portfolio may contain loans that are in the form of lines of credit or revolving credit facilities, which require the Company to provide funding when requested by portfolio companies in accordance with the terms of the underlying loan agreements. As of March 31, 2023 and December 31, 2022, the Company had 49 and 52 of such investments with aggregate unfunded commitments of $25,826,912 and $27,824,9178, respectively. The Company maintains sufficient liquidity (through cash on hand and available borrowings under the Credit Facility) to fund such unfunded loan commitments should the need arise.

The aggregate gross unrealized appreciation and depreciation and the aggregate cost and fair value of the Company’s portfolio company securities as March 31, 2023 and December 31, 2022 were as follows:


	2023		2022
Aggregate cost of portfolio company securities	$	912,581,782	$	875,823,177
Gross unrealized appreciation of portfolio company securities		30,021,948		28,927,746
Gross unrealized depreciation of portfolio company securities		(63,946,451)		(58,602,607)
Gross unrealized appreciation on foreign currency translations of portfolio company securities		9,269		—
Gross unrealized depreciation on foreign currency translations of portfolio company securities		(1,172,767)		(1,414,678)
Aggregate fair value of portfolio company securities	$	877,493,781	$	844,733,638

The fair values of our investments disaggregated into the three levels of the fair value hierarchy based upon the lowest level of significant input used in the valuation as of March 31, 2023 are as follows:


	Quoted Prices
	in Active
	Markets		Significant Other		Significant
	for Identical		Observable		Unobservable
	Securities		Inputs		Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
Senior Secured – First Lien	$	—	$	—	$	767,818,131	$	767,818,131
Senior Secured – Second Lien		—		—		43,780,075		43,780,075
Unsecured Debt		—		—		5,428,810		5,428,810
Equity		—		—		60,466,765		60,466,765
Total Investments	$	—	$	—	$	877,493,781	$	877,493,781

The fair values of our investments disaggregated into the three levels of the fair value hierarchy based upon the lowest level of significant input used in the valuation as of December 31, 2022 are as follows:

The aggregate values of Level 3 portfolio investments change during the three months ended March 31, 2023 are as follows:


	Senior Secured		Senior Secured
	Loans-First		Loans-Second		Unsecured
	Lien		Lien		Debt		Equity		Total
Fair value at beginning of period	$	735,555,508	$	45,304,300	$	4,823,898	$	59,049,932	$	844,733,638
Purchases of investments		38,908,052		—		—		2,329,221		41,237,273
Payment-in-kind interest		598,421		—		171,533		—		769,954
Sales and redemptions		(5,903,154)		—		—		(14,974)		(5,918,128)
Realized (losses) gains		(870)		—		—		4,377		3,507
Change in unrealized (depreciation) appreciation included in earnings⁽¹⁾		(2,214,114)		(1,561,184)		429,571		(903,915)		(4,249,642)
Change in unrealized appreciation on foreign currency included in earnings		249,057		—		—		2,124		251,181
Amortization of premium and accretion of discount, net		625,231		36,959		3,808		—		665,998
Fair value at end of period	$	767,818,131	$	43,780,075	$	5,428,810	$	60,466,765	$	877,493,781

(1)	Includes reversal of positions during the three months ended March 31, 2023.

There were no Level 3 transfers during the three months ended March 31, 2023.

The aggregate values of Level 3 portfolio investments change during the year ended December 31, 2022 are as follows:


	Senior Secured		Senior Secured
	Loans-First		Loans-Second		Unsecured
	Lien		Lien		Debt		Equity		Total
Fair value at beginning of period	$	646,352,935	$	56,733,110	$	4,883,854	$	64,903,427	$	772,873,326
Purchases of investments		196,925,873		4,900,000		83,511		9,101,485		211,010,869
Payment-in-kind interest		826,816		—		530,361		—		1,357,177
Sales and redemptions		(98,160,329)		(10,809,276)		—		(18,873,195)		(127,842,800)
Realized (losses) gains		(3,929,334)		(4,109,525)		—		11,811,371		3,772,512
Change in unrealized depreciation included in earnings⁽¹⁾		(7,342,462)		(1,611,688)		(687,778)		(7,900,302)		(17,542,230)
Change in unrealized (depreciation) appreciation on foreign currency included in earnings		(1,421,824)		—		—		7,146		(1,414,678)
Amortization of premium and accretion of discount, net		2,303,833		201,679		13,950		—		2,519,462
Fair value at end of period	$	735,555,508	$	45,304,300	$	4,823,898	$	59,049,932	$	844,733,638

(1)	Includes reversal of positions during the twelve months ended December 31, 2022.

There were no Level 3 transfers during the twelve months ended December 31, 2022.

The following is a summary of geographical concentration of our investment portfolio as of March 31, 2023:


					% of Total
	Cost		Fair Value		Investments
California	$	179,822,505	$	177,328,495	20.21	%
Texas		191,169,751		169,192,709	19.28	%
Florida		70,928,731		69,786,799	7.95	%
Illinois		64,136,431		51,089,935	5.82	%
Arizona		43,048,182		44,223,012	5.03	%
Pennsylvania		42,794,571		42,003,646	4.79	%
Ohio		33,701,526		37,033,209	4.22	%
Washington		28,991,782		28,520,772	3.25	%
New Jersey		25,317,538		25,404,660	2.90	%
Wisconsin		27,522,337		24,405,731	2.78	%
South Carolina		23,985,102		23,307,462	2.66	%
District of Columbia		17,021,109		20,332,646	2.32	%
Georgia		10,866,076		19,558,379	2.23	%
Minnesota		17,072,971		16,764,036	1.91	%
Maryland		16,774,301		16,600,434	1.89	%
Colorado		15,103,204		14,472,339	1.65	%
Indiana		14,357,762		14,478,350	1.65	%
Canada		13,312,608		13,123,054	1.50	%
United Kingdom		20,599,520		12,759,683	1.45	%
Tennessee		11,413,288		11,413,288	1.30	%
North Carolina		10,446,206		10,631,238	1.21	%
Massachusetts		10,199,234		10,517,456	1.20	%
Idaho		9,742,830		9,778,705	1.11	%
Missouri		9,121,069		9,627,249	1.10	%
New York		5,133,148		5,140,494	0.59	%
	$	912,581,782	$	877,493,781	100.00	%

The following is a summary of geographical concentration of our investment portfolio as of December 31, 2022:


					% of Total
					Investments
	Cost		Fair Value		at fair value
Texas	$	191,422,143	$	171,165,597	20.26	%
California		167,833,384		165,340,017	19.57	%
Florida		60,593,839		59,421,775	7.03	%
Illinois		64,421,998		53,218,615	6.30	%
Arizona		43,129,283		44,277,625	5.24	%
Pennsylvania		42,899,504		41,889,344	4.96	%
Ohio		34,223,452		37,333,236	4.42	%
Washington		28,978,375		28,480,471	3.37	%
New Jersey		25,395,054		25,140,343	2.98	%
Wisconsin		27,533,402		24,271,761	2.87	%
District of Columbia		17,236,556		21,124,347	2.50	%
Georgia		10,919,642		19,692,757	2.33	%
South Carolina		19,089,373		18,654,782	2.21	%
Maryland		16,824,077		16,576,554	1.96	%
Minnesota		16,972,086		15,952,072	1.89	%
United Kingdom		20,530,087		14,445,481	1.71	%
Colorado		15,204,934		14,295,470	1.69	%
Indiana		14,346,082		14,245,432	1.69	%
Canada		13,333,737		13,266,669	1.57	%
North Carolina		10,461,551		10,649,232	1.26	%
Massachusetts		10,215,356		10,527,659	1.25	%
Idaho		9,873,093		9,863,103	1.17	%
Missouri		9,142,111		9,656,287	1.14	%
New York		5,096,152		5,096,008	0.61	%
Michigan		147,906		149,001	0.02	%
	$	875,823,177	$	844,733,638	100.00	%

The following is a summary of industry concentration of our investment portfolio as of March 31, 2023:


					% of Total
	Cost		Fair Value		Investments
Services: Business	$	214,938,285	$	225,555,095	25.70	%
Healthcare & Pharmaceuticals		90,768,290		91,838,092	10.47	%
Consumer Goods: Durable		59,536,778		56,844,795	6.48	%
Media: Advertising, Printing & Publishing		52,707,992		52,833,166	6.02	%
Consumer Goods: Non-Durable		54,573,002		51,799,071	5.90	%
Beverage, Food, & Tobacco		44,255,730		43,826,641	4.99	%
Aerospace & Defense		48,175,509		37,969,299	4.33	%
Software		37,504,347		37,740,143	4.30	%
Capital Equipment		33,548,956		34,006,902	3.88	%
Construction & Building		26,868,234		26,527,191	3.02	%
Environmental Industries		27,675,169		25,341,098	2.89	%
Services: Consumer		43,347,965		24,770,484	2.83	%
Media: Broadcasting & Subscription		18,587,328		21,616,919	2.46	%
Chemicals, Plastics, & Rubber		18,482,917		17,699,203	2.02	%
Transportation & Logistics		16,742,199		17,115,334	1.95	%
Metals & Mining		16,676,543		16,504,906	1.88	%
Retail		14,961,662		14,936,630	1.70	%
Containers, Packaging, & Glass		17,442,042		14,035,836	1.60	%
High Tech Industries		14,105,434		13,006,779	1.48	%
Automotive		11,115,290		11,193,750	1.28	%
Education		11,039,366		10,349,882	1.18	%
Utilities: Oil & Gas		9,926,667		9,850,000	1.12	%
Energy: Oil & Gas		6,821,814		6,958,701	0.79	%
Media: Diversified & Production		5,563,272		5,607,424	0.64	%
Finance		1,568,063		5,092,591	0.58	%
FIRE: Real Estate		15,648,928		3,661,577	0.42	%
Hotel, Gaming, & Leisure		-		812,272	0.09	%
Total	$	912,581,782	$	877,493,781	100.00	%

The following is a summary of industry concentration of our investment portfolio as of December 31, 2022:


					% of Total
					Investments
	Cost		Fair Value		at fair value
Services: Business	$	207,234,534	$	218,866,572	25.91	%
Healthcare & Pharmaceuticals		86,469,854		88,103,319	10.43	%
Media: Advertising, Printing & Publishing		52,830,447		52,525,839	6.22	%
Consumer Goods: Non-Durable		54,683,102		51,280,593	6.07	%
Consumer Goods: Durable		45,601,928		44,529,176	5.27	%
Aerospace & Defense		48,137,394		39,526,086	4.68	%
Software		37,582,855		37,975,255	4.50	%
Capital Equipment		33,538,647		33,801,951	4.00	%
Beverage, Food, & Tobacco		34,000,918		32,755,054	3.88	%
Construction & Building		26,948,135		26,406,849	3.13	%
Environmental Industries		27,771,798		26,247,936	3.11	%
Services: Consumer		43,302,101		24,616,706	2.92	%
Media: Broadcasting & Subscription		18,615,052		21,445,307	2.54	%
Chemicals, Plastics, & Rubber		18,487,206		17,903,999	2.12	%
Transportation & Logistics		16,768,763		17,161,972	2.03	%
Metals & Mining		16,708,750		16,464,001	1.95	%
Containers, Packaging, & Glass		17,436,600		13,977,250	1.65	%
Retail		13,303,536		13,217,256	1.56	%
High Tech Industries		14,126,954		12,648,347	1.50	%
Automotive		11,252,581		11,342,751	1.34	%
Education		11,057,921		10,498,760	1.24	%
Utilities: Oil & Gas		9,921,469		9,800,000	1.16	%
Energy: Oil & Gas		7,314,230		7,355,074	0.87	%
FIRE: Real Estate		15,642,093		5,866,397	0.69	%
Media: Diversified & Production		5,517,409		5,534,710	0.66	%
Finance		1,568,900		4,082,579	0.48	%
Hotel, Gaming, & Leisure		—		799,899	0.09	%
	$	875,823,177	$	844,733,638	100.00	%

The following provides quantitative information about Level 3 fair value measurements as of March 31, 2023:


Description:	Fair Value		Valuation Technique	Unobservable Inputs	Range (Average)⁽¹⁾⁽³⁾
First lien debt	$	767,818,131	Income/Market	HY credit spreads,	-0.57% to 8.60% (1.09%)
			approach⁽²⁾	Risk free rates	-1.76% to 3.61% (1.57%)
				Market multiples	4.5x to 19.3x (10.0x)⁽⁴⁾

Second lien debt	$	43,780,075	Income/Market	HY credit spreads,	-0.60% to 3.60% (1.44%)
			approach⁽²⁾	Risk free rates	-0.36% to 3.58% (1.82%)
				Market multiples	5.6x to 15.1x (11.4x)⁽⁴⁾

Unsecured debt	$	5,428,810	Income/Market	HY credit spreads,	6.39% to 6.39% (6.39%)
			approach⁽²⁾	Risk free rates	3.30% to 3.30% (3.30%)
				Market multiples	9.1x to 9.1x (9.1x)⁽⁴⁾

Equity investments	$	60,466,765	Market approach⁽⁵⁾	Underwriting multiple/
				EBITDA Multiple	1.3x to 24.6x (11.8x)
Total Long Term Level 3 Investments	$	877,493,781

(1)	Weighted average based on fair value as of March 31, 2023.

(2)	Included but not limited to (a) the market approach, which is used to determine sufficient enterprise value, and (b) the income approach which is based on discounting future cash flows using an appropriate market yield.

(3)

The Company calculates the price of the loan by discounting future cash flows, which include forecasted future BSBY, LIBOR, SOFR, or SONIA rates based on the published forward curve at the valuation date, using an appropriate yield calculated as of the valuation date. This yield is calculated based on the loan’s yield at the original investment and is adjusted as of the valuation date based on: changes in comparable credit spreads, changes in risk free interest rates (per swap rates), and changes in credit quality (via an estimated shadow rating). Significant movements in any of these factors could result in a significantly lower or higher fair value measurement. As an example, the “Range (Average)” for first lien debt instruments in the table above indicates that the change in the HY spreads between the date a loan closed and the valuation date ranged from -0.57% (-57 basis points) to 8.60% (860 basis points). The average of all changes was 1.09% (109 basis points).

(4)	Median of LTM (last twelve months) EBITDA multiples of comparable companies.

(5)

The primary significant unobservable input used in the fair value measurement of the Company’s equity investments is the EBITDA multiple (the “Multiple”). Significant increases (decreases) in the Multiple in isolation could result in a significantly higher (lower) fair value measurement. To determine the Multiple for the market approach, the Company considers current market trading and/or transaction multiple, portfolio company performance (financial ratios) relative to public and private peer companies and leverage levels, among other factors. Changes in one or more of these factors can have a similar directional change on other factors in determining the appropriate Multiple to use in the market approach.

The following provides quantitative information about Level 3 fair value measurements as of December 31, 2022:



Description:	Fair Value		Valuation Technique	Unobservable Inputs	Range (Average)⁽¹⁾⁽³⁾
First lien debt	$	735,555,508	Income/Market	HY credit spreads,	-2.29% to 6.53% (1.52%)
			approach⁽²⁾	Risk free rates	-1.43% to 4.31% (2.31%)
				Market multiples	4.5x to 19.3x (10.1x)⁽⁴⁾

Second lien debt	$	45,304,300	Income/Market	HY credit spreads,	-0.17% to 5.18% (2.39%)
			approach⁽²⁾	Risk free rates	-0.02% to 3.91% (1.94%)
				Market multiples	5.6x to 15.1x (11.4x)⁽⁴⁾

Unsecured debt	$	4,823,898	Income/Market	HY credit spreads,	7.97% to 7.97% 7.97%)
			approach⁽²⁾	Risk free rates	3.63% to 3.63% (3.63%)
				Market multiples	9.1x to 9.1x (9.1x)⁽⁴⁾

Equity investments	$	59,049,932	Market approach⁽⁵⁾	Underwriting multiple/
				EBITDA Multiple	1.3x to 24.8x (11.7x)
Total Long Term Level 3 Investments	$	844,733,638

(1)	Weighted average based on fair value as of December 31, 2022.

(2)	Inclusive of but not limited to (a) the market approach, which is used to determine sufficient enterprise value, and (b) the income approach which is based on discounting future cash flows using an appropriate market yield.

(3)

The Company calculates the price of the loan by discounting future cash flows, which include forecasted future LIBOR rates based on the published forward LIBOR curve at the valuation date, using an appropriate yield calculated as of the valuation date. This yield is calculated based on the loan’s yield at the original investment and is adjusted as of the valuation date based on: changes in comparable credit spreads, changes in risk free interest rates (per swap rates), and changes in credit quality (via an estimated shadow rating). Significant movements in any of these factors would result in a significantly lower or higher fair value measurement. As an example, the “Range (Average)” for a first lien debt instruments in the table above indicates that the change in the HY spreads between the date a loan closed and the valuation date ranged from -2.29% (-229 basis points) to 6.53% (653 basis points). The average of all changes was 1.52% (152 basis points).

(4)	Median of LTM (last twelve months) EBITDA multiples of comparable companies.

(5)

The primary significant unobservable input used in the fair value measurement of the Company’s equity investments is the EBITDA multiple (the “Multiple”). Significant increases (decreases) in the Multiple in isolation would result in a significantly higher (lower) fair value measurement. To determine the Multiple for the market approach, the Company considers current market trading and/or transaction multiple, portfolio company performance (financial ratios) relative to public and private peer companies and leverage levels, among other factors. Changes in one or more of these factors can have a similar directional change on other factors in determining the appropriate Multiple to use in the market approach.