In accordance with the 1940 Act, the Company is permitted to borrow amounts such that its asset coverage ratio, as defined in the 1940 Act, is at least 150% after such borrowing. As of March 31, 2023 and December 31, 2022, the Company’s asset coverage ratio based on aggregate borrowings outstanding was 221% and 199%, respectively.

The Company’s outstanding debt as of March 31, 2023 and December 31, 2022 was as follows:

⁽¹⁾	Represents the total aggregate amount committed or outstanding, as applicable, under such instrument.

⁽²⁾	Represents the aggregate principal amount outstanding of the Credit Facility (as defined below), less unamortized debt issuance costs. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs were $2,087 and $2,496, respectively.

⁽³⁾	Represents the aggregate principal amount outstanding of the Term Loan (as defined below), less unamortized debt issuance costs. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs were $1,441 and $1,047, respectively.

⁽⁴⁾	As of both March 31, 2023 and December 31, 2022, the Class C Senior Secured Notes and Subordinated Notes (as defined below) totaling $36,125 and $82,875, are excluded from the total aggregate principal amount committed/outstanding amount as these notes are eliminated in consolidation.

⁽⁵⁾	Represents the aggregate principal amount outstanding of the 2022 ABS (as defined below), less unamortized debt issuance costs. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs were $8,175 and $8,371, respectively.

Revolving Credit Facility: The Company has a $450,000 Credit Facility with KeyBank National Association through the Company’s wholly-owned subsidiary, the SPV. The Company’s ability to borrow under the Credit Facility is subject to certain financial and restrictive covenants as well as availability under the borrowing base, which permits the Company to borrow up to 72% of the principal balance of its portfolio company investments depending on the type of investment, subject to a maximum advance rate on the portfolio of 67%. Under the terms of the Credit Facility, the SPV is permitted to reinvest available cash and make new borrowings under the Credit Facility through July 16, 2024. The maturity date of the Credit Facility is July 16, 2026. Distributions from the SPV to the Company are limited by the terms of the Credit Facility, which generally allows for the distribution of net interest income pursuant to a waterfall quarterly during the reinvestment period. As of March 31, 2023 and December 31, 2022, the fair value of investments of the Company that were held in the SPV as collateral for the Credit Facility was $671,146 and $691,225, respectively, and these investments are identified on the accompanying consolidated schedules of investments. As of March 31, 2023 and December 31, 2022, the Company had outstanding borrowings under the Credit Facility of $253,500 and $357,400, respectively.

During the reinvestment period, borrowings under the Credit Facility bear interest at an annual rate of LIBOR (one or three month, at the SPV’s option and subject to a LIBOR minimum of 0.50%) plus a margin ranging from 2.75% to a maximum of 3.00%, depending on the level of utilization of the facility and the number of obligors of eligible loans pledged as collateral in the SPV. After the reinvestment period, borrowings under the Credit Facility bear interest at an annual rate of LIBOR plus 3.25%. In addition to the stated interest rate on borrowings, the SPV is required to pay an unused commitment fee of (i) 0.50% per annum on any unused portion of the Credit Facility when the outstanding borrowings are less than or equal to 60% of the facility amount and (ii) 0.35% per annum on any unused portion of the Credit Facility when the outstanding borrowings are greater than 60% of the facility. As of March 31, 2023 and December 31, 2022, the outstanding borrowings were accruing at a weighted average interest rate of 7.4% and 6.9%, respectively.

During the three months ended March 31, 2023 and 2022, the Company incurred financing costs of $11 and $447, respectively, in conjunction with the Credit Facility, which have been capitalized within unamortized deferred financing costs and are amortized into interest and other debt financing expenses over the life of the loan.

Term Loan: On December 20, 2022, the Company entered into the Term Loan with KeyBank National Association, as lead arranger and administrative agent, through a special purpose wholly-owned subsidiary, SPV II. The Term Loan initially allowed SPV II to borrow an aggregate principal amount of $100,000, and included an accordion feature which allows the Company, under certain circumstances, to increase the total size of the facility upon request to the administrative agent and with consent of one or more increasing or additional lenders. On February 3, 2023, the Company increased the facility amount pursuant to the accordion feature of the Term Loan from $100,000 of aggregate commitments to $155,000 of aggregate commitments and the Company borrowed up to the new aggregate commitments under the Term Loan. As of March 31, 2023 and December 31, 2022, the Company had outstanding borrowings under the Term Loan of $151,886 and $100,000, respectively. As of March 31, 2023 and December 31, 2022 the fair value of the Company’s investments held in SPV II as collateral for the Term Loan was $217,697 and $141,418, respectively, and these investments are identified on the accompanying consolidated schedules of investments.

Borrowings under the Term Loan bear interest at Adjusted Term SOFR (subject to a SOFR minimum of 0.50%) plus an applicable margin rate of 2.40% per annum during the initial period, December 20, 2022 through December 20, 2025, and 3.40% per annum during the amortization period, December 21, 2025 through December 20, 2026. The Term Loan matures on December 20, 2026, unless sooner terminated in accordance with its terms. As of March 31, 2023 and December 31, 2022, the outstanding borrowings were accruing at a weighted average interest rate of 7.1% and 6.7%, respectively.

During the three months ended March 31, 2023, the Company incurred financing costs of $508 in conjunction with the Term Loan, which have been capitalized within unamortized deferred financing costs and are amortized into interest and other debt financing expenses over the life of the loan.

Under the terms of the Term Loan, pursuant to a monthly waterfall and subject to the satisfaction of certain coverage tests and portfolio quality tests, SPV II is permitted to reinvest 25% of principal proceeds during the initial period, with the remaining 75% applied to prepay the Term Loan. During the amortization period, pursuant to a monthly waterfall, 100% of principal proceeds must be applied to prepay the Term Loan. The Term Loan contains representations and warranties and affirmative and negative covenants customary for secured financings of this type. The Term Loan also contains customary events of default (subject to certain grace periods, as applicable), including but not limited to the nonpayment of principal, interest or fees, breach of covenants, voluntary or involuntary bankruptcy proceedings and change of control of the borrower.

Asset-Backed Securitization: On April 7, 2022, the Company completed a $425,000 asset-backed securitization (the “2022 ABS”). The notes offered in the 2022 ABS were issued by the 2022 Issuer, a wholly-owned subsidiary of the Company, and are secured by a diversified portfolio of senior secured loans. The transaction was executed through a private placement of $261,375 of Class A Senior Secured Notes, which bear interest at 4.05% (the “Class A Notes”), $44,625 of Class B Senior Secured Notes, which bear interest at 5.15% (the “Class B Notes”) and $36,125 of Class C Senior Secured Notes, which bear interest at 7.75% (the “Class C Notes” and collectively with the Class A Notes and the Class B Notes, the “Secured 2022 Notes”), and $82,875 of Subordinated Notes, which do not bear interest (the “Subordinated 2022 Notes” and, together with the Secured 2022 Notes, the “2022 Notes”). The Company retained all of the Class C Notes and the Subordinated 2022 Notes. The Class A Notes and the Class B Notes are included as debt on the consolidated statements of assets and liabilities. As of both March 31, 2023 and December 31, 2022, the Class C and Subordinated Notes were eliminated in consolidation.

Through April 22, 2024, the 2022 Issuer is permitted to use all principal collections received on the underlying collateral to purchase new collateral under the direction of MC Advisors, in its capacity as collateral manager of the 2022 Issuer, in accordance with the Company’s investment strategy and subject to customary conditions set forth in the documents governing the 2022 ABS, allowing the Company to maintain the initial leverage in the 2022 ABS. The 2022 Notes are due on April 30, 2032.

As of March 31, 2023 and December 31, 2022, the fair value of investments of the Company that were held in the 2022 Issuer as collateral was $421,236 and $410,179, respectively, and these investments are identified on the consolidated schedule of investments.

Distributions from the 2022 Issuer to the Company are limited by the terms of the indenture governing the 2022 ABS, which generally allows for the payment of interest on the Secured 2022 Notes and the distribution of remaining net interest income to the holders of the Subordinated Notes pursuant to a waterfall quarterly during the reinvestment period.

Components of Interest Expense: The components of the Company’s interest and other debt financing expenses and average debt outstanding and average stated interest rate (i.e. the rate in effect plus spread) were as follows:


	Three months ended March 31,
	2023			2022
Interest expense - Credit Facility	$	5,798		$	2,895
Interest expense - Term Loan		2,340			—
Interest expense - 2022 ABS		3,221			—
Amortization of deferred financing costs		730			385
Total interest and other debt financing expenses	$	12,089		$	3,280
Average debt outstanding	$	750,495		$	339,678
Average stated interest rate		6.1	%		3.4	%