Debt

12 Months Ended

Dec. 31, 2022

Debt Disclosure [Abstract]

Debt

Note 6. Debt

Debt consisted of the following (in thousands):
 

	December 31, 2022								December 31, 2021
	Aggregate Principal Amount Committed		Drawn Amount		Amount Available (1)		Carrying Value(2)(3)		Aggregate Principal Amount Committed		Drawn Amount		Amount Available (1)		Carrying Value(2)(3)
SPV Asset Facility	$	350,000	$	233,000	$	117,000	$	233,000	$	350,000	$	249,500	$	100,500	$	249,500
SMBC Corporate Revolving Facility		350,000		241,836		108,164		241,836		300,000		203,437		96,563		203,437
2023 Unsecured Notes		50,000		50,000		—		50,000		50,000		50,000		—		50,000
2026 Unsecured Notes(4)		135,000		135,000		—		135,000		135,000		135,000		—		135,000
Total Debt	$	885,000	$	659,836	$	225,164	$	659,836	$	835,000	$	637,937	$	197,063	$	637,937

(1)The amount available is subject to any limitations related to the respective debt facilities’ borrowing bases and foreign currency translation adjustments.

(2)The amount presented excludes netting of deferred financing costs.

(3)As of December 31, 2022 and 2021, the carrying amount of the Company’s outstanding debt approximated fair value, unless otherwise noted.

(4)As of December 31, 2022, the fair value of the 2026 Unsecured Notes was approximately $123,223.

The combined weighted average interest rate of the aggregate borrowings outstanding for the years ended December 31, 2022, 2021 and 2020 was 4.73%, 3.72% and 3.68%, respectively. The combined weighted average debt of the aggregate borrowings outstanding for the years ended December 31, 2022, 2021 and 2020 was $673,503, $530,675 and $421,066, respectively.

The fair values of the Company’s debt are determined in accordance with ASC 820, which defines fair value in terms of the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. The fair value of the Company's debt is calculated by discounting remaining payments using comparable market rates or market quotes for similar instruments at the measurement date. As of December 31, 2022 and 2021, the debt would be deemed to be Level 3 of the fair value hierarchy.

As of December 31, 2022 and 2021, the Company was in compliance with the terms and covenants of its debt arrangements.

SPV Asset Facility

On March 28, 2016, Crescent Capital BDC Funding, LLC (“CCAP SPV”), a wholly owned subsidiary of CCAP, entered into a loan and security agreement, as amended from time to time (the “SPV Asset Facility”), with the Company as the collateral manager, seller and equityholder, CCAP SPV as the borrower, the banks and other financial institutions from time to time party thereto as lenders, and Wells Fargo Bank, National Association (“Wells Fargo”), as administrative agent, collateral agent, and lender. CCAP SPV is consolidated into the Company’s financial statements and no gain or loss is recognized from transfer of assets to and from CCAP SPV.

The maximum commitment amount under the SPV Asset Facility is $350,000 and may be increased with the consent of Wells Fargo or reduced upon request of the Company. Proceeds of the advances under the SPV Asset Facility may be used to acquire portfolio investments, to make distributions to the Company in accordance with the SPV Asset Facility, and to pay related expenses. The maturity date is the earlier of (a) the date the Borrower voluntarily reduces the commitments to zero, (b) June 22, 2026 and (c) the date upon which Wells Fargo declares the obligations due and payable after the occurrence of an Event of Default. Borrowings under

the SPV Asset Facility bear interest at LIBOR plus a margin with no LIBOR floor. The margin is between 1.65% and 2.10% as determined by the proportion of liquid and illiquid loans pledged to the SPV Asset Facility. The Company pays unused facility fees of 0.50% per annum on committed but undrawn amounts under the SPV Asset Facility. The unused facility fee rate may vary based on the utilization. The SPV Asset Facility includes customary covenants, including certain limitations on the incurrence of additional indebtedness and liens, as well as usual and customary events of default for revolving credit facilities of this nature. The facility size is subject to availability under the borrowing base, which is based on the amount of CCAP SPV’s assets from time to time, and satisfaction of certain conditions, including certain concentration limits.

Costs incurred in connection with obtaining the SPV Asset Facility were recorded as deferred financing costs and are being amortized over the life of the SPV Asset Facility on an effective yield basis. As of December 31, 2022 and 2021, deferred financing costs related to the SPV Asset Facility were $2,110 and $2,718, respectively, and were netted against debt outstanding on the Consolidated Statements of Assets and Liabilities.

SMBC Corporate Revolving Facility

On October 27, 2021, the Company entered into a senior secured revolving credit agreement, as amended from time to time, with Sumitomo Mitsui Banking Corporation, as administrative agent, collateral agent and lender (the “SMBC Corporate Revolving Facility”). The maximum principal amount of the SMBC Corporate Revolving Facility is $350,000, subject to availability under the borrowing base. Borrowings under the SMBC Corporate Revolving Facility bear interest at adjusted SOFR plus 1.875% or 2.000%, subject to certain provisions in the SMBC Corporate Revolving Facility agreement, with no benchmark rate floor. The Company pays unused facility fees of 0.375% per annum on committed but undrawn amounts under the SMBC Corporate Revolving Facility. Any amounts borrowed under the SMBC Corporate Revolving Facility, and all accrued and unpaid interest, will be due and payable, on October 27, 2026.

Costs incurred in connection with obtaining the SMBC Corporate Revolving Facility were recorded as deferred financing costs and are being amortized over the life of the SMBC Corporate Revolving Facility on an effective yield basis. As of December 31, 2022 and 2021, deferred financing costs related to the SMBC Corporate Revolving Facility were $2,217 and $2,569, respectively, and were netted against debt outstanding on the Consolidated Statements of Assets and Liabilities.

Ally Corporate Revolving Facility

On August 20, 2019, the Company entered into a senior secured revolving credit facility with Ally Bank, as administrative agent

and arranger (the “Ally Corporate Revolving Facility”). The maximum principal amount of the Ally Corporate Revolving Facility was $200,000, subject to availability under the borrowing base. Borrowings under the Ally Corporate Revolving Facility bore interest at LIBOR plus a 2.35% margin with no LIBOR floor.

The Company terminated the Ally Corporate Revolving Facility concurrent with the closing of the SMBC Corporate Revolving Facility on October 27, 2021.

2023 Unsecured Notes

On July 30, 2020, the Company completed a private offering of $50,000 aggregate principal amount of 5.95% senior unsecured notes due July 30, 2023 (the “2023 Unsecured Notes”). The 2023 Unsecured Notes were issued in two $25,000 issuances on July 30, 2020 and October 28, 2020.

The 2023 Unsecured Notes will mature on July 30, 2023 and may be redeemed in whole or in part, at the Company’s option, any time on or after January 30, 2023 at par plus accrued interest or any time prior to January 30, 2023 at par plus a “make-whole” premium and accrued interest. Interest on the 2023 Unsecured Notes is due and payable semiannually in arrears on January 30 and July 30 of each year.

Costs incurred in connection with issuing the 2023 Unsecured Notes were recorded as deferred financing costs and are being amortized over the life of the 2023 Unsecured Notes on an effective yield basis. As of December 31, 2022 and 2021, deferred financing costs related to the 2023 Unsecured Notes were $157 and $429, respectively, and were netted against debt outstanding on the Consolidated Statements of Assets and Liabilities.

2026 Unsecured Notes

On February 17, 2021, the Company completed a private offering of $135,000 aggregate principal amount of 4.00% senior unsecured notes due February 17, 2026 (the “2026 Unsecured Notes”). The initial issuance of $50,000 of 2026 Unsecured Notes closed February 17, 2021. The issuance of the remaining $85,000 of 2026 Unsecured Notes closed on May 5, 2021.

The 2026 Unsecured Notes will mature on February 17, 2026 and may be redeemed in whole or in part, at the Company’s option, at any time or from time to time at par plus a “make-whole” premium, if applicable. Interest on the 2026 Unsecured Notes is due and payable semiannually in arrears on February 17 and August 17 of each year.

Costs incurred in connection with issuing the 2026 Unsecured Notes were recorded as deferred financing costs and are being amortized over the life of the 2026 Unsecured Notes on an effective yield basis. As of December 31, 2022 and 2021, deferred financing costs related to the 2026 Unsecured Notes were $895 and $1,181, respectively, and were netted against debt outstanding on the Consolidated Statements of Assets and Liabilities.

InterNotes®

On January 31, 2020, in connection with the Alcentra Acquisition, the Company assumed direct unsecured fixed interest rate obligations or “InterNotes®”. The InterNotes® bore interest at fixed interest rates ranging between 6.25% and 6.75% and offered a variety of maturities ranging between February 15, 2021 and April 15, 2022. The Company redeemed or paid down the remaining $16,418 of InterNotes® during the first quarter of 2021.

Summary of Interest and Credit Facility Expenses

The borrowing expenses incurred by the SPV Asset Facility, Ally Corporate Revolving Facility, SMBC Corporate Revolving Facility, 2023 Unsecured Notes, 2026 Unsecured Notes, and InterNotes® were as follows (in thousands):

	For the years ended December 31,
	2022		2021		2020
Borrowing interest expense	$	28,930	$	16,166	$	13,417
Unused facility fees		1,212		1,046		740
Amortization of financing costs		1,738		2,554		1,328
Total interest and credit facility expenses	$	31,880	$	19,766	$	15,485
Weighted average outstanding balance	$	673,503	$	530,675	$	421,066