NOTES

6 Months Ended

Jun. 30, 2023

NOTES

NOTES

NOTE 11 — NOTES

On January 14, 2021, the Company issued $100,000,000 in aggregate principal amount of 4.875% fixed-rate notes due 2026 (the “2026 Notes”). The 2026 Notes will mature on March 30, 2026 and may be redeemed in whole or in part at any time or from time to time at our option on or after December 31, 2025, at a redemption price equal to 100% of the outstanding principal, plus accrued and unpaid interest. Interest on the 2026 Notes is payable semi-annually beginning June 30, 2022. As of both June 30, 2023 and December 31, 2022, the aggregate carrying amount of the 2026 Notes was approximately $100,000,000. The 2026 Notes are institutional, non-traded notes.

In connection with the issuance and maintenance of the 2026 Notes, the Company incurred $2,327,835 of fees which are being amortized over the term of the 2026 Notes. As of June 30, 2023 and December 31, 2022, $1,228,784 and $1,450,308 of prepaid financing costs had yet to be amortized, respectively. These financing costs are presented on the Consolidated Statements of Assets and Liabilities as a deduction from the debt liability.

The following table summarizes the interest expense and deferred financing costs on the 2026 Notes for the three and six months ended June 30, 2023 and 2022:

	For the three months ended						For the six months ended
	June 30, 2023			June 30, 2022			June 30, 2023			June 30, 2022
Interest expense	$	1,224,750		$	1,218,750		$	2,443,500		$	2,442,500
Deferred financing costs		111,374			111,374			221,524			221,524
Total interest and financing expenses	$	1,336,124		$	1,330,124		$	2,665,024		$	2,664,024
Weighted average interest rate		4.9	%		4.9	%		4.9	%		4.9	%
Effective interest rate (including fee amortization)		5.4	%		5.3	%		5.4	%		5.4	%
Average debt outstanding	$	100,000,000		$	100,000,000		$	100,000,000		$	100,000,000
Cash paid for interest	$	6,000		$	—		$	2,443,500		$	2,437,500

The following is a summary of the 2026 Notes Payable, net of deferred financing costs:

	June 30, 2023		December 31, 2022
Notes payable	$	100,000,000	$	100,000,000
Deferred financing costs		(1,228,784)		(1,450,308)
Notes payable, net of deferred financing costs	$	98,771,216	$	98,549,692

The indenture and supplements thereto relating to the 2026 Notes contain certain covenants, including but not limited to (i) a requirement that the Company comply with the asset coverage requirements of the 1940 Act or any successor provisions, and (ii) a requirement to provide financial information to the holders of the notes and the trustee under the indenture if the Company should no longer be subject to the reporting requirements under the Exchange Act. As of June 30, 2023 and 2022, the Company was in compliance with these covenants.