QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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(State or other jurisdiction of
incorporation or organization)
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(IRS Employer Identification No.) |
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(Address of principal executive offices)
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(Zip Code)
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Title of Each Class
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Trading Symbol(s)
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Name of each exchange on which registered
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||
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Large accelerated filer
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☐
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Accelerated filer
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☐
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☒
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Smaller reporting company
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Emerging growth company
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TABLE OF CONTENTS
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PAGE
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NO.
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||
PART I
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FINANCIAL INFORMATION
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Item 1
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4
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4
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||
5
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||
6
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||
8
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||
9
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||
11
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||
Item 2
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24
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Item 3
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34
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Item 4
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35
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PART II
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OTHER INFORMATION
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Item 1
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36
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Item 1A
|
36
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Item 2
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36
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Item 3
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36
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Item 4
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36
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Item 5
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36
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Item 6
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36
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37
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•
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our future operating results and distribution projections;
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•
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the ability of Silver Spike Capital, LLC (“SSC”) to attract and retain highly talented professionals;
|
•
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our business prospects and the prospects of our portfolio companies;
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•
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the impact of interest and inflation rates on our business prospects and the prospects of our portfolio companies;
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•
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the impact of the investments that we expect to make;
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•
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the ability of our portfolio companies to achieve their objectives;
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•
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our expected financings and investments and the timing of our investments in our initial portfolio;
|
•
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changes in regulation impacting the cannabis industry;
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•
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the adequacy of our cash resources and working capital;
|
•
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the current and future effects of the COVID-19 pandemic on us and our portfolio companies; and
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•
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the timing of cash flows, if any, from the operations of our portfolio companies.
|
•
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our limited operating history;
|
•
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changes or potential disruptions in our operations, the economy, financial markets or political environment;
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•
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risks associated with possible disruption in our operations or the economy generally due to terrorism, natural disasters or the COVID-19 pandemic;
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•
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future changes in laws or regulations (including the interpretation of these laws and regulations by regulatory authorities) and conditions in our operating areas, particularly with respect to business
development companies (“BDCs”) or regulated investment companies (“RICs”); and
|
•
|
other considerations that may be disclosed from time to time in our publicly disseminated documents and filings.
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|
September 30, 2023 |
December 31, 2022
|
||||||
|
(unaudited)
|
|||||||
ASSETS
|
||||||||
Investments at fair value:
|
||||||||
Non-control/non-affiliate investments at fair value (amortized cost of $
|
$
|
|
$
|
|
||||
Cash and cash equivalents
|
|
|
||||||
Interest receivable
|
|
|
||||||
Prepaid expenses
|
|
|
||||||
Other assets | ||||||||
Total assets
|
$
|
|
$
|
|
||||
|
||||||||
LIABILITIES
|
||||||||
Income-based incentive fees payable
|
$ | $ | ||||||
Management fee payable
|
||||||||
Legal fees payable |
||||||||
Valuation fees payables
|
||||||||
Administrator fees payable
|
||||||||
Audit fees payable
|
||||||||
Director’s fee payable
|
||||||||
Professional fees payable
|
||||||||
Other payables |
||||||||
Distributions payable |
||||||||
Due to affiliate
|
|
|||||||
Excise tax payable
|
|
|||||||
Total liabilities
|
$
|
|
$
|
|
||||
|
||||||||
Commitments and contingencies (Note 6)
|
|
|||||||
|
||||||||
NET ASSETS
|
||||||||
Common Stock, $
|
$
|
|
$
|
|
||||
Additional paid-in-capital
|
|
|
||||||
Distributable earnings/(Accumulated losses)
|
|
|
||||||
Total net assets
|
$
|
|
$
|
|
||||
NET ASSET VALUE PER SHARE
|
$
|
|
$
|
|
|
Three Months Ended
|
Nine Months Ended |
||||||||||||||
|
September 30, 2023
|
September 30, 2022
|
September 30, 2023 | September 30, 2022 | ||||||||||||
INVESTMENT INCOME
|
||||||||||||||||
Non-control/non-affiliate investment income
|
||||||||||||||||
Interest income
|
$
|
|
$
|
|
$ | $ | ||||||||||
Fee income
|
|
|
||||||||||||||
Total investment income
|
|
|
||||||||||||||
|
||||||||||||||||
EXPENSES
|
||||||||||||||||
Income-based incentive fees
|
|
|
||||||||||||||
Management fee
|
||||||||||||||||
Audit expenses
|
||||||||||||||||
Legal expense
|
|
|
||||||||||||||
Administrator fees
|
|
|
||||||||||||||
Insurance expense
|
|
|
||||||||||||||
Director expenses
|
|
|
||||||||||||||
Valuation fees
|
||||||||||||||||
Professional fees
|
|
|
||||||||||||||
Custodian fees
|
|
|
||||||||||||||
Organizational expenses
|
|
|
||||||||||||||
Capital gains incentive fees
|
( |
) | ||||||||||||||
Other expenses
|
|
|
||||||||||||||
Total expenses
|
|
|
||||||||||||||
|
||||||||||||||||
NET INVESTMENT INCOME (LOSS)
|
|
|
||||||||||||||
|
||||||||||||||||
NET REALIZED GAIN (LOSS) FROM INVESTMENTS
|
||||||||||||||||
Non-controlled/non-affiliate investments
|
( |
) | ||||||||||||||
Net realized gain (loss) from investments
|
|
|
( |
) | ||||||||||||
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) FROM INVESTMENTS
|
||||||||||||||||
Non-controlled/non-affiliate investments
|
(
|
)
|
|
|||||||||||||
Net change in unrealized appreciation (depreciation) from investments
|
(
|
)
|
|
|||||||||||||
Net realized and unrealized gains (losses) |
( |
) | ( |
) | ||||||||||||
|
||||||||||||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS
|
$
|
|
$
|
|
$ | $ | ||||||||||
|
||||||||||||||||
NET INVESTMENT INCOME (LOSS) PER SHARE — BASIC AND DILUTED
|
$
|
|
$
|
|
$ | $ | ||||||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS PER SHARE — BASIC AND DILUTED
|
$
|
|
$
|
|
$ | $ | ||||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING — BASIC AND DILUTED
|
|
|
|
Common Stock
|
|||||||||||||||||||
Three Months Ended
September 30, 2023
|
Shares
|
Par Value
|
Additional
paid-in-capital |
Distributable Earnings/
(Accumulated Loss)
|
Total
net assets
|
|||||||||||||||
Balance, June 30, 2023
|
|
$
|
|
$
|
|
$
|
|
$
|
|
|||||||||||
Net increase (decrease) in net assets resulting from operations
|
||||||||||||||||||||
Net investment income (loss)
|
-
|
|
|
|
|
|||||||||||||||
Net realized gain (loss) from investments
|
-
|
|
|
|
|
|||||||||||||||
Net change in unrealized appreciation (depreciation) from investments
|
-
|
|
|
(
|
)
|
(
|
)
|
|||||||||||||
Total net increase (decrease) in net assets resulting from operations
|
-
|
|
|
|
|
|||||||||||||||
Distributions to stockholders from: |
||||||||||||||||||||
Investment income-net
|
- | ( |
) | ( |
) | |||||||||||||||
Capital transactions
|
||||||||||||||||||||
Issuance of common stock
|
|
|
|
|
|
|||||||||||||||
Reinvestment of stockholder distributions
|
||||||||||||||||||||
Total net increase (decrease) in net assets from capital transactions
|
||||||||||||||||||||
Total increase (decrease) in net assets | ( |
) | ( |
) | ||||||||||||||||
Effect of permanent adjustments |
- | |||||||||||||||||||
Balance, September 30, 2023
|
|
$
|
|
$
|
|
$
|
|
$
|
|
Common Stock
|
||||||||||||||||||||
Three Months Ended
September 30, 2022
|
Shares
|
Par value
|
Additional
paid-in-capital |
Distributable Earnings/
(Accumulated Loss) |
Total
net assets
|
|||||||||||||||
Balance, June 30, 2022
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
Net increase (decrease) in net assets resulting from operations
|
||||||||||||||||||||
Net investment income (loss)
|
-
|
|
|
|
|
|||||||||||||||
Net realized gain (loss) from investments
|
-
|
|
|
|
|
|||||||||||||||
Net change in unrealized appreciation (depreciation) from investments
|
-
|
|
|
|
|
|||||||||||||||
Total net increase (decrease) in net assets resulting from operations
|
-
|
|
|
|
|
|||||||||||||||
Capital transactions
|
||||||||||||||||||||
Issuance of common stock, net of offering cost
|
|
|
|
|
|
|||||||||||||||
Total increase (decrease) in net assets
|
|
|
|
|
|
|||||||||||||||
Effect of permanent adjustments
|
-
|
|
|
|
|
|||||||||||||||
Balance, September 30, 2022
|
|
$
|
|
$
|
|
$
|
|
$
|
|
|
Common Stock
|
|||||||||||||||||||
Nine Months Ended
September 30, 2023
|
Shares
|
Par Value
|
Additional
paid-in-capital |
Distributable Earnings/
(Accumulated Loss)
|
Total
net assets
|
|||||||||||||||
Balance, December 31, 2022
|
|
$
|
|
$
|
|
$
|
|
$
|
|
|||||||||||
Net increase (decrease) in net assets resulting from operations
|
||||||||||||||||||||
Net investment income (loss)
|
-
|
|
|
|
|
|||||||||||||||
Net realized gain (loss) from investments
|
-
|
|
|
(
|
)
|
(
|
)
|
|||||||||||||
Net change in unrealized appreciation (depreciation) from investments
|
-
|
|
|
|
|
|||||||||||||||
Total net increase (decrease) in net assets resulting from operations
|
-
|
|
|
|
|
|||||||||||||||
Distributions to stockholders from:
|
||||||||||||||||||||
Investment income-net
|
- | ( |
) | ( |
) | |||||||||||||||
Capital transactions
|
||||||||||||||||||||
Issuance of common stock
|
|
|
|
|
|
|||||||||||||||
Reinvestment of stockholder distributions
|
||||||||||||||||||||
Total net increase (decrease) in net assets from capital transactions
|
||||||||||||||||||||
Total increase (decrease) in net assets | ||||||||||||||||||||
Effect of permanent adjustments |
- | ( |
) | |||||||||||||||||
Balance, September 30, 2023
|
|
$
|
|
$
|
|
$
|
|
$
|
|
Common Stock
|
||||||||||||||||||||
Nine Months Ended
September 30, 2022
|
Shares
|
Par value
|
Additional
paid-in-capital |
Distributable Earnings/
(Accumulated Loss)
|
Total
net assets
|
|||||||||||||||
Balance, December 31, 2021
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
|||||||||
Net increase (decrease) in net assets resulting from operations
|
||||||||||||||||||||
Net investment income (loss)
|
-
|
|
|
|
|
|||||||||||||||
Net realized gain (loss) from investments
|
-
|
|
|
|
|
|||||||||||||||
Net change in unrealized appreciation (depreciation) from investments
|
-
|
|
|
|
|
|||||||||||||||
Total net increase (decrease) in net assets resulting from operations
|
-
|
|
|
|
|
|||||||||||||||
Capital transactions
|
||||||||||||||||||||
Issuance of common stock, net of offering costs of $
|
|
|
|
|
|
|||||||||||||||
Total increase (decrease) in net assets
|
|
|
|
|
|
|||||||||||||||
Effect of permanent adjustments
|
-
|
|
(
|
)
|
|
|
||||||||||||||
Balance, September 30, 2022
|
|
$
|
|
$
|
|
$
|
|
$
|
|
|
For the nine months ended
|
|||||||
|
September 30, 2023
|
September 30, 2022
|
||||||
Cash flows from operating activities
|
||||||||
Net increase (decrease) in net assets resulting from operations
|
$
|
|
$
|
|
||||
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities:
|
||||||||
Net realized (gain) loss from investments
|
||||||||
Net change in unrealized (appreciation) depreciation from investments
|
(
|
)
|
|
|||||
Net (accretion of discounts) and amortization of premiums
|
(
|
)
|
(
|
)
|
||||
Purchase of investments
|
(
|
)
|
(
|
)
|
||||
PIK interest capitalized
|
( |
) | ||||||
Proceeds from sales of investments and principal repayments
|
||||||||
(Increase)/Decrease in operating assets:
|
||||||||
Interest receivable
|
(
|
)
|
(
|
)
|
||||
Other assets
|
( |
) | ||||||
Prepaid expenses
|
(
|
)
|
(
|
)
|
||||
Deferred offering costs
|
|
|||||||
Increase/(Decrease) in operating liabilities:
|
||||||||
Income-based incentive fees payable
|
|
|
||||||
Management fee payable
|
||||||||
Legal fees payable
|
||||||||
Valuation fees payable
|
|
|
||||||
Administrator fees payable
|
|
|
||||||
Audit fees payable
|
|
|||||||
Director’s fee payable
|
|
|
||||||
Professional fees payable
|
(
|
)
|
|
|||||
Other payable
|
(
|
)
|
|
|||||
Due to affiliate
|
|
( |
) | |||||
Excise tax payable
|
( |
) |
|
|||||
Offering cost payable
|
(
|
)
|
||||||
Organization costs payable
|
|
(
|
)
|
|||||
Net cash provided by (used in) operating activities
|
(
|
)
|
(
|
)
|
||||
|
||||||||
Cash flows from financing activities
|
||||||||
Issuance of common stock, net of offering cost
|
|
|
||||||
Distributions paid
|
( |
) | ||||||
Net cash provided by (used in) financing activities
|
(
|
)
|
|
|||||
|
||||||||
Net increase (decrease) in cash & cash equivalents
|
(
|
)
|
|
|||||
Cash & cash equivalents, beginning of period
|
|
|
||||||
Cash & cash equivalents, end of period
|
$
|
|
$
|
|
||||
Supplemental and non-cash financing activities |
||||||||
Reinvestment of dividend distributions |
$ | $ |
Portfolio Company (1)
|
Type of
Investment (2)
|
Investment
Date (3)
|
Maturity Date
|
Interest Rate (4)
|
Fair Value
Hierarchy (5)
|
Geographic
Region (6) |
Non-Qualifying
Asset (7)
|
Principal
Amount (8)
|
Amortized Cost
|
Fair
Value (9)
|
% of Net
Assets
|
|||||||||||||||
Debt Securities - United States
|
||||||||||||||||||||||||||
Wholesale Trade (10)
|
||||||||||||||||||||||||||
.
|
|
|
|
Fixed interest rate
|
|
|
Yes
|
$ |
|
$ |
|
$ |
|
|
%
|
|||||||||||
(d/b/a Jeeter)
|
|
|
|
Variable interest rate PRIME(11) + |
No |
|
||||||||||||||||||||
|
|
|
|
Variable interest rate PRIME(11) +
( |
|
|
No
|
|
|
|
|
|||||||||||||||
|
|
|
|
Fixed interest rate
|
|
|
No
|
|
|
|
|
|||||||||||||||
(f/k/a Shryne Group Inc.)
|
|
|
|
Variable interest rate PRIME(11) +
( |
|
|
No
|
|
|
|
|
|||||||||||||||
|
|
|
|
Variable interest rate PRIME(11) +
( |
|
|
Yes
|
|
|
|
|
|||||||||||||||
|
$
|
|
|
|
|
|||||||||||||||||||||
|
||||||||||||||||||||||||||
Total: Debt Securities -United States (
|
|
|
|
|||||||||||||||||||||||
|
||||||||||||||||||||||||||
Total: Debt Securities (
|
|
|
|
|||||||||||||||||||||||
|
||||||||||||||||||||||||||
Total Investment in Securities (
|
$
|
|
$
|
|
|
%
|
||||||||||||||||||||
|
||||||||||||||||||||||||||
Cash equivalents
|
||||||||||||||||||||||||||
State Street Institutional U.S. Government Money Market Fund (12)
|
$
|
|
$
|
|
|
%
|
||||||||||||||||||||
Cash equivalents (
|
|
|
|
|||||||||||||||||||||||
|
||||||||||||||||||||||||||
Total Portfolio Investments and Cash equivalents (
|
$
|
|
$
|
|
|
%
|
(1) |
|
(2) |
|
(3) |
|
(4) |
|
(5) |
|
(6) |
|
(7) |
|
(8) |
|
(9) |
|
(10) |
|
(11) |
|
(12) |
|
Portfolio Company (1)
|
Type of
Investment (2)
|
Investment
Date (3)
|
Maturity Date
|
Interest Rate (4)
|
Fair Value
Hierarchy (5) |
Geographic
Region (6) |
Non-Qualifying
Asset (7)
|
Principal
Amount (8)
|
Amortized
Cost
|
Fair
Value (9) |
% of
Net Assets
|
|||||||||||||||
Debt Securities - United States
|
|
|
|
|
|
|||||||||||||||||||||
Wholesale Trade (10)
|
|
|
||||||||||||||||||||||||
|
|
|
|
Fixed interest rate
|
|
|
No
|
$
|
|
$
|
|
$
|
|
|
%
|
|||||||||||
|
|
|
|
Fixed interest rate
|
|
|
No
|
|
|
|
|
|||||||||||||||
|
|
|
|
Fixed interest rate
|
|
|
No
|
|
|
|
|
|||||||||||||||
|
|
|
|
Variable interest rate PRIME(11) +
( |
|
|
No
|
|
|
|
|
|||||||||||||||
|
|
|
|
Variable interest rate PRIME(11) +
( |
|
|
No
|
|
|
|
|
|||||||||||||||
|
|
|
|
|
|
$
|
|
|
|
|
||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||
Total: Debt Securities - United States (
|
|
|
|
|
|
|||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||
Total: Debt Securities (
|
|
|
|
|
|
|||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||
Total Investment in Securities (
|
|
|
$
|
|
$
|
|
|
%
|
||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||
Cash equivalents
|
|
|
||||||||||||||||||||||||
State Street Institutional U.S. Government Money Market Fund (12)
|
|
|
|
$
|
|
$
|
|
|
%
|
|||||||||||||||||
Cash equivalents (
|
|
|
|
|
|
|||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||
Total Portfolio Investments and Cash equivalents (
|
|
|
$
|
|
$
|
|
|
%
|
(1) |
All portfolio companies are located in the United States.
|
(2) |
|
(3) |
Investment date represents the date of initial investment, at which date interest began accruing.
|
(4) |
Interest rate is the fixed or variable rate of the debt investments.
|
(5) |
See Note 2 – Significant Accounting Policies and Note 4 — Fair Value of Financial Instruments in the accompanying notes to the financial statements.
|
(6) |
Geographic regions are determined by the respective portfolio company’s headquarters’ location.
|
(7) |
Under the Investment Company Act of 1940, as amended (the “1940 Act”), a business development company (“BDC”) may not acquire any “non-qualifying asset” (i.e., an asset other than assets of the type listed in Section 55(a) of the 1940
Act, which are referred to as “qualifying assets”), unless, at the time the acquisition is made, qualifying assets represent at least 70% of the BDC’s total assets.
|
(8) |
Principal is net of repayments, if any, as per the terms of the debt instrument’s contract.
|
(9) |
All investments were valued at fair value. See Note 4 — Fair Value of Financial Instruments in the accompanying notes to the financial statements.
|
(10) |
The Company uses the North American Industry Classification System (“NAICS”) code for classifying the industry grouping of its portfolio companies.
|
(11) |
|
(12) |
|
• |
With respect to investments for which market quotations are readily available, those investments will typically be valued at the bid price of those market quotations;
|
• |
With respect to investments for which market quotations are not readily available, the valuation process begins with the Adviser’s valuation committee establishing a preliminary valuation of each investment, which may be based on
valuations, or ranges of valuations, provided by independent valuation firm(s);
|
• |
Preliminary valuations are documented and discussed by the Adviser’s valuation committee and, where appropriate, the independent valuation firm(s); and
|
• |
The Adviser determines the fair value of each investment.
|
• |
Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that we have the ability to access at the measurement date;
|
• |
Level 2 – Valuations based on quoted prices for similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not
active, or for which all significant inputs are observable, either directly or indirectly; and
|
• |
Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.
|
September 30, 2023
|
||||||||||||||||
Amortized Cost
|
Fair Value
|
|||||||||||||||
Industry
|
Amount
|
%
|
Amount
|
%
|
||||||||||||
Wholesale Trade
|
$
|
|
|
%
|
$
|
|
|
%
|
||||||||
Total
|
$
|
|
|
%
|
$
|
|
|
%
|
December 31, 2022
|
||||||||||||||||
Amortized Cost
|
Fair Value
|
|||||||||||||||
Industry
|
Amount
|
%
|
Amount
|
%
|
||||||||||||
Wholesale Trade
|
$
|
|
|
%
|
$
|
|
|
%
|
||||||||
Total
|
$
|
|
|
%
|
$
|
|
|
%
|
September 30, 2023
|
||||||||||||||||
Amortized Cost
|
Fair Value
|
|||||||||||||||
Geographic Location
|
Amount
|
%
|
Amount
|
%
|
||||||||||||
West
|
$
|
|
|
%
|
$
|
|
|
%
|
||||||||
Midwest
|
|
|
|
|
||||||||||||
Northeast
|
|
|
|
|
||||||||||||
Total
|
$
|
|
|
%
|
$
|
|
|
%
|
December 31, 2022
|
||||||||||||||||
Amortized Cost
|
Fair Value
|
|||||||||||||||
Geographic Location
|
Amount
|
%
|
Amount
|
%
|
||||||||||||
Midwest
|
$
|
|
|
%
|
$
|
|
|
%
|
||||||||
West
|
|
|
|
|
||||||||||||
Northeast
|
|
|
|
|
||||||||||||
Southeast
|
|
|
|
|
||||||||||||
Total
|
$
|
|
|
%
|
$
|
|
|
%
|
September 30, 2023
|
||||||||||||||||
Amortized Cost
|
Fair Value
|
|||||||||||||||
Investment
|
Amount
|
%
|
Amount
|
%
|
||||||||||||
Senior Secured First Lien Term Loan
|
$
|
|
|
%
|
$
|
|
|
%
|
||||||||
Senior Secured Notes
|
|
|
|
|
||||||||||||
Total
|
$
|
|
|
%
|
$
|
|
|
%
|
December 31, 2022
|
||||||||||||||||
Amortized Cost
|
Fair Value
|
|||||||||||||||
Investment
|
Amount
|
%
|
Amount
|
%
|
||||||||||||
Senior Secured First Lien Term Loan
|
$
|
|
|
%
|
$
|
|
|
%
|
||||||||
Senior Secured Notes
|
|
|
|
|
||||||||||||
Total
|
$
|
|
|
%
|
$
|
|
|
%
|
Fair Value Measurements at September 30, 2023 Using
|
||||||||||||||||
Assets
|
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
|
Significant
Other
Observable
Inputs (Level 2)
|
Significant
Unobservable
Inputs (Level 3)
|
Total
|
||||||||||||
Senior Secured First Lien Term Loan
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Senior Secured Notes
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
Fair Value Measurements at December 31, 2022 Using
|
||||||||||||||||
Assets
|
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
|
Significant
Other
Observable
Inputs (Level 2)
|
Significant
Unobservable
Inputs (Level 3)
|
Total
|
||||||||||||
Senior Secured First Lien Term Loan
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Senior Secured Notes
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
Investment Type
|
Fair Value as of
September 30, 2023 |
Valuation Techniques/
Methodologies
|
Unobservable
Input
|
Range
|
Weighted Average (1)
|
||||||||||
Senior Secured First Lien Term Loan
|
$
|
|
Discounted Cash Flow
|
Discount Rate
|
|
%
|
|
%
|
|||||||
Senior Secured Notes
|
|
Discounted Cash Flow
|
Discount Rate
|
|
%
|
|
%
|
||||||||
Total
|
$
|
|
Investment Type
|
Fair Value as of
December 31, 2022
|
Valuation Techniques/ Methodologies
|
Unobservable
Input
|
Range
|
Weighted Average (1)
|
||||||||||
Senior Secured First Lien Term Loan
|
$
|
|
Discounted Cash Flow
|
Discount Rate
|
|
%
|
|
%
|
|||||||
Volatility
|
|
%
|
|
%
|
|||||||||||
Senior Secured Notes
|
|
Discounted Cash Flow
|
Discount Rate
|
|
%
|
|
%
|
||||||||
Volatility
|
|
%
|
|
%
|
|||||||||||
Total
|
$
|
|
Senior Secured
First Lien Term Loan |
Senior
Secured Notes |
Total
Investments |
||||||||||
Fair Value as of December 31, 2022
|
$
|
|
$
|
|
$
|
|
||||||
Purchases
|
|
|
|
|||||||||
Accretion of discount and fees (amortization of premium), net
|
|
|
|
|||||||||
PIK interest |
||||||||||||
Proceeds from sales of investments and principal repayments
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Net realized gain (loss) on investments
|
|
(
|
)
|
(
|
)
|
|||||||
Net change in unrealized appreciation (depreciation) on investments
|
|
(
|
)
|
|
||||||||
Balance as of September 30, 2023
|
$
|
|
$
|
|
$
|
|
||||||
|
||||||||||||
Net change in unrealized appreciation/depreciation on Level 3 investments still held as of September 30, 2023
|
$
|
|
$
|
(
|
)
|
$
|
|
Senior Secured
First Lien Term Loan |
Total
Investments |
|||||||
Fair Value as of December 31, 2021
|
$
|
|
$
|
|
||||
Purchases
|
|
|
||||||
Accretion of discount and fees (amortization of premium), net
|
|
|
||||||
PIK interest
|
|
|
||||||
Proceeds from sales of investments and principal repayments
|
|
|
||||||
Net realized gain (loss) on investments
|
|
|
||||||
Net change in unrealized appreciation (depreciation) on investments
|
|
|
||||||
Balance as of September 30, 2022
|
$
|
|
$
|
|
||||
Net change in unrealized appreciation/depreciation on Level 3 investments still held as of September 30, 2022
|
$
|
|
$
|
|
Declaration Date
|
Type
|
Record Date
|
Payment Date
|
Per Share
Amount |
Dividends Paid
|
|||||||||
|
|
|
|
$
|
|
$
|
|
|||||||
|
|
|
|
$
|
|
$
|
|
Declaration Date |
Type |
Record Date
|
Payment Date
|
Shares
|
||||||
|
|
|
|
|||||||
|
|
|
|
|
Three Months Ended
|
Three Months Ended
|
Nine Months Ended | Nine Months Ended | |||||||||||||
September 30, 2023
|
September 30, 2022
|
September 30, 2023 | September 30, 2022 | |||||||||||||
Net increase (decrease) in net assets resulting from operations
|
$
|
|
$
|
|
$ | $ | ||||||||||
Weighted Average Shares Outstanding - basic and diluted
|
|
|
||||||||||||||
Net increase (decrease) in net assets resulting from operations per share - basic and diluted
|
$
|
|
$
|
|
$ | $ |
March 31, 2023
|
||||
Undistributed ordinary income
|
$
|
|
||
Net unrealized appreciation (depreciation) on investments
|
|
|||
Other temporary differences
|
(
|
)
|
||
Total
|
$
|
|
September 30, 2023 |
March 31, 2023
|
December 31, 2022
|
||||||||||
Tax cost of investments and cash equivalents
|
$ |
$
|
|
$
|
|
|||||||
|
||||||||||||
Unrealized appreciation
|
$ |
$
|
|
$
|
|
|||||||
Unrealized depreciation
|
( |
) |
|
(
|
)
|
|||||||
Net unrealized appreciation (depreciation) from investments and cash equivalents
|
$ | ( |
) |
$
|
|
$
|
(
|
)
|
Nine Months Ended |
Period from
February 3, 2022 to |
|||||||
September 30, 2023
|
September 30, 2022*
|
|||||||
Per share data:
|
||||||||
Net asset value at beginning of period
|
$
|
|
$
|
|
||||
Net investment income (loss) (1)
|
|
|
||||||
Net realized and unrealized gains/(losses) on investments(1)
|
(
|
)
|
|
|||||
Net increase/(decrease) in net assets resulting from operations
|
|
|
||||||
Offering costs (2)
|
|
(
|
)
|
|||||
Permanent tax adjustments (2)
|
|
(
|
)
|
|||||
Less distributions from net investment income (loss) |
( |
) | ||||||
Net asset value at end of period
|
$
|
|
$
|
|
||||
Net assets at end of period
|
$
|
|
$
|
|
||||
Shares outstanding at end of period
|
|
|
||||||
Weighted average net assets
|
$
|
|
$
|
|
||||
|
||||||||
Per share market value at end of period
|
$
|
|
$
|
|
||||
Total return based on market value (3)
|
(
|
)%
|
(
|
)%
|
||||
Total return based on net asset value (3)
|
|
%
|
(
|
)%
|
||||
|
||||||||
Ratio/Supplemental data:
|
||||||||
Ratio of expenses to average net assets(4)
|
|
%
|
|
%
|
||||
Ratio of net investment income (loss) to average net assets(4)
|
|
%
|
|
%
|
||||
Portfolio turnover (4)
|
|
%
|
N/A
|
*
|
|
(1) |
|
(2) |
|
(3) |
|
(4) |
|
• |
the cost of our organization and offerings;
|
• |
the cost of calculating our NAV, including the cost of any third-party valuation services;
|
• |
the cost of effecting sales and repurchases of shares of our common stock and other securities;
|
• |
fees and expenses payable under any underwriting agreements, if any;
|
• |
debt service and other costs of borrowings or other financing arrangements;
|
• |
costs of hedging;
|
• |
expenses, including travel expenses, incurred by the Adviser, or members of the investment team, or payable to third-parties, performing due diligence on prospective portfolio companies and, if necessary, enforcing our rights;
|
• |
management and incentive fees payable pursuant to the Investment Advisory Agreement;
|
• |
fees payable to third-parties relating to, or associated with, making investments and valuing investments (including third-party valuation firms);
|
• |
costs, including legal fees, associated with compliance under cannabis laws;
|
• |
transfer agent and custodial fees;
|
• |
fees and expenses associated with marketing efforts (including attendance at industry and investor conferences and similar events);
|
• |
federal and state registration fees;
|
• |
any exchange listing fees and fees payable to rating agencies;
|
• |
federal, state and local taxes;
|
• |
independent directors’ fees and expenses, including travel expenses;
|
• |
cost of preparing financial statements and maintaining books and records and filing reports or other documents with the SEC (or other regulatory bodies) and other reporting and compliance costs, and the compensation of professionals
responsible for the preparation of the foregoing;
|
• |
the cost of any reports, proxy statements or other notices to our stockholders (including printing and mailing costs), the costs of any stockholder or director meetings and the compensation of investor relations personnel responsible for
the preparation of the foregoing and related matters;
|
• |
brokerage commissions and other compensation payable to brokers or dealers;
|
• |
research and market data;
|
• |
fidelity bond, directors’ and officers’ errors and omissions liability insurance and other insurance premiums;
|
• |
direct costs and expenses of administration, including printing, mailing and staff;
|
• |
fees and expenses associated with independent audits, and outside legal and consulting costs;
|
• |
costs of winding up;
|
• |
costs incurred in connection with the formation or maintenance of entities or vehicles to hold our assets for tax or other purposes;
|
• |
extraordinary expenses (such as litigation or indemnification); and
|
• |
costs associated with reporting and compliance obligations under the 1940 Act and applicable federal and state securities laws.
|
September 30, 2023
|
||||||||
Type
|
Amortized Cost
|
Fair Value
|
||||||
Senior Secured First Lien Term Loan
|
86.0
|
%
|
86.3
|
%
|
||||
Senior Secured Notes
|
14.0
|
13.7
|
||||||
Total
|
100.0
|
%
|
100.0
|
%
|
December 31, 2022
|
||||||||
Type
|
Amortized Cost
|
Fair Value
|
||||||
Senior Secured First Lien Term Loan
|
80.9
|
%
|
80.9
|
%
|
||||
Senior Secured Notes
|
19.1
|
19.1
|
||||||
Total
|
100.0
|
%
|
100.0
|
%
|
September 30, 2023
|
||||||||
Geographic Region
|
Amortized Cost
|
Fair Value
|
||||||
West
|
43.2
|
%
|
43.2
|
%
|
||||
Midwest
|
42.8
|
42.6
|
||||||
Northeast
|
14.0
|
14.2
|
||||||
Total
|
100.0
|
%
|
100.0
|
%
|
December 31, 2022
|
||||||||
Geographic Region
|
Amortized Cost
|
Fair Value
|
||||||
Midwest
|
48.4
|
%
|
48.5
|
%
|
||||
West
|
40.5
|
40.3
|
||||||
Northeast
|
7.6
|
7.7
|
||||||
Southeast
|
3.5
|
3.5
|
||||||
Total
|
100.0
|
%
|
100.0
|
%
|
September 30, 2023
|
||||||||
Industry
|
Amortized Cost
|
Fair Value
|
||||||
Wholesale Trade
|
100.0
|
%
|
100.0
|
%
|
||||
Total
|
100.0
|
%
|
100.0
|
%
|
December 31, 2022
|
||||||||
Industry
|
Amortized Cost
|
Fair Value
|
||||||
Wholesale Trade
|
100.0
|
%
|
100.0
|
%
|
||||
Total
|
100.0
|
%
|
100.0
|
%
|
Nine Months Ended
September 30, 2023 |
Nine Months Ended
September 30, 2022 |
|||||||
Beginning Portfolio, at fair value
|
$
|
50,254,550
|
$
|
-
|
||||
Purchases
|
8,442,000
|
24,417,500
|
||||||
Accretion of discount and fees (amortization of premium), net
|
431,052
|
49,966
|
||||||
PIK interest
|
78,153
|
-
|
||||||
Proceeds from sales of investments and principal repayments
|
(1,780,000
|
)
|
-
|
|||||
Net realized gain/(loss) on investments
|
(210,767
|
)
|
-
|
|||||
Net change in unrealized appreciation/(depreciation) on investments
|
166,012
|
-
|
||||||
Ending Portfolio, at fair value
|
$
|
57,381,000
|
$
|
24,467,466
|
Investment
Performance
Risk Rating
|
Summary Description
|
|
Grade 1
|
Investments rated 1 involve the least amount of risk to our initial cost basis. The borrower is performing above expectations, and the trends and risk factors for this investment since origination or
acquisition are generally favorable. Full return of principal, interest and dividend income is expected.
|
|
Grade 2
|
Investment is performing in-line with expectations. Investments rated 2 involve an acceptable level of risk that is similar to the risk at the time of origination or acquisition. Risk factors remain neutral
or favorable compared with initial underwriting. All investments or acquired investments in new portfolio companies are initially assessed a rating of 2.
|
|
Grade 3
|
Investments rated 3 involve a borrower performing below expectations and indicates that the loan’s risk has increased somewhat since origination or acquisition. Capital impairment or payment delinquency is
not anticipated. The investment may also be out of compliance with certain financial covenants.
|
|
Grade 4
|
Investments rated 4 involve a borrower performing materially below expectations and indicates that the loan’s risk has increased materially since origination or acquisition. In addition to the borrower being
generally out of compliance with debt covenants, loan payments may be past due (but generally not more than 120 days past due). Delinquency of interest and / or dividend payments in anticipated. No loss of principal is anticipated.
|
|
Grade 5
|
Investments rated 5 involve a borrower performing substantially below expectations and indicates that the loan’s risk has increased substantially since origination or acquisition. It is anticipated that the
Company will not recoup its initial cost and may realize a loss upon exit. Most or all of the debt covenants are out of compliance and payments are substantially delinquent. Loans rated 5 are not anticipated to be repaid in full and we will
reduce the fair market value of the loan to the amount we anticipate will be recovered.
|
September 30, 2023
|
|||||||
Investment Performance Risk Rating
|
Investments at Fair
Value
|
Percentage of Total
Investments
|
|||||
1 |
$
|
-
|
-
|
%
|
|||
2 |
57,381,000
|
100.00
|
|||||
3 |
-
|
-
|
|||||
4 |
-
|
-
|
|||||
5 |
-
|
-
|
|||||
Total
|
$
|
57,381,000
|
100.00
|
%
|
December 31, 2022
|
|||||||
Investment Performance Risk Rating
|
Investments at Fair
Value
|
Percentage of Total
Investments
|
|||||
1 |
$ | - | - | % |
|||
2 |
50,254,550 |
100.00
|
|||||
3 |
- | - | |||||
4 |
- | - | |||||
5 |
- |
- | |||||
Total
|
$ | 50,254,550 |
100.00
|
% |
Three Months Ended
September 30, 2023 |
Three Months Ended
September 30, 2022 |
Nine Months Ended
September 30, 2023 |
Nine Months Ended
September 30, 2022 |
|||||||||||||
Stated interest income
|
$
|
2,740,665
|
$
|
1,140,058
|
$
|
7,596,808
|
$
|
1,540,215
|
||||||||
Accretion of discount and fees (amortization of premium), net
|
129,494
|
40,459
|
431,052
|
49,966
|
||||||||||||
Payment in-kind interest
|
15,566
|
-
|
78,153
|
-
|
||||||||||||
Total interest income
|
2,885,725
|
1,180,517
|
8,106,013
|
1,590,181
|
||||||||||||
Other fee income
|
31,250
|
-
|
162,500
|
410,000
|
||||||||||||
Total investment income
|
$
|
2,916,975
|
$
|
1,180,517
|
$
|
8,268,513
|
$
|
2,000,181
|
Three Months Ended
September 30, 2023 |
Three Months Ended
September 30, 2022 |
Nine Months Ended
September 30, 2023 |
Nine Months Ended
September 30, 2022 |
|||||||||||||
Gross unrealized appreciation
|
$
|
-
|
$
|
-
|
$
|
365,811
|
$
|
-
|
||||||||
Gross unrealized depreciation
|
(343,104
|
)
|
9,508
|
(199,799
|
)
|
-
|
||||||||||
Total net unrealized appreciation (depreciation) on investments
|
$
|
(343,104
|
)
|
$
|
9,508
|
$
|
166,012
|
$
|
-
|
Three Months Ended
September 30, 2023 |
Three Months Ended
September 30, 2022 |
Nine Months Ended
September 30, 2023 |
Nine Months Ended
September 30, 2022 |
|||||||||||||
STIIIZY, Inc. (f/k/a Shryne Group Inc.)
|
$
|
(129,301
|
)
|
$
|
-
|
$
|
212,530
|
$
|
-
|
|||||||
Verano Holdings Corp.
|
(33,861
|
)
|
-
|
90,950
|
-
|
|||||||||||
MariMed Inc.
|
(39,029
|
)
|
-
|
(8,165
|
)
|
-
|
||||||||||
Dreamfields Brands, Inc. (d/b/a Jeeter)
|
(32,298
|
)
|
-
|
(32,220
|
)
|
-
|
||||||||||
PharmaCann, Inc.
|
(62,871
|
)
|
9,508
|
(159,414
|
)
|
-
|
||||||||||
Curaleaf Holdings, Inc.
|
(45,744
|
)
|
-
|
62,331
|
-
|
|||||||||||
Total net change in unrealized appreciation (depreciation) on investments
|
$
|
(343,104
|
)
|
$
|
9,508
|
$
|
166,012
|
$
|
-
|
• |
With respect to investments for which market quotations are readily available, those investments will typically be valued at the bid price of those market quotations;
|
• |
With respect to investments for which market quotations are not readily available, the valuation process begins with the Adviser’s valuation committee establishing a preliminary valuation of each investment, which may be based on
valuations, or ranges of valuations, provided by independent valuation firm(s);
|
• |
Preliminary valuations are documented and discussed by the Adviser’s valuation committee and, where appropriate, the independent valuation firm(s); and
|
• |
The Adviser determines the fair value of each investment.
|
• |
Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that we have the ability to access at the measurement date;
|
• |
Level 2 – Valuations based on quoted prices for similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active,
or for which all significant inputs are observable, either directly or indirectly; and
|
• |
Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.
|
Price Range
|
||||||||||||||||||||||||
Class and Period
|
Net Asset
Value(1)
|
High
|
Low
|
High Sales
Price
Premium (Discount) to
Net Asset
Value(2)
|
Low Sales
Price Premium (Discount) to
Net Asset
Value(2)
|
Cash
Dividend Per Share(3)
|
||||||||||||||||||
Year Ended December 31, 2023
|
||||||||||||||||||||||||
Fourth Quarter (Through November 6, 2023)
|
$
|
*
|
$
|
9.67
|
$
|
9.21
|
*
|
*
|
*
|
|||||||||||||||
Third Quarter
|
$
|
14.06
|
$
|
10.37
|
$
|
7.65
|
-26.3
|
%
|
-45.6
|
%
|
0.63
|
(6)
|
||||||||||||
Second Quarter
|
$
|
14.49
|
$
|
9.19
|
$
|
7.82
|
-36.3
|
%
|
-45.8
|
%
|
-
|
|||||||||||||
First Quarter
|
$
|
14.29
|
$
|
9.98
|
$
|
8.25
|
-30.2
|
%
|
-42.3
|
%
|
-
|
|||||||||||||
Year Ended December 31, 2022(4)
|
||||||||||||||||||||||||
Fourth Quarter
|
$
|
13.91
|
$
|
10.55
|
$
|
9.57
|
-24.2
|
%
|
-31.2
|
%
|
-
|
|||||||||||||
Third Quarter
|
$
|
13.73
|
$
|
10.74
|
$
|
9.00
|
-21.8
|
%
|
-34.5
|
%
|
-
|
|||||||||||||
Second Quarter
|
$
|
13.64
|
$
|
13.50
|
$
|
7.80
|
-1.0
|
%
|
-42.8
|
%
|
-
|
|||||||||||||
First Quarter(5)
|
$
|
13.61
|
$
|
14.41
|
$
|
12.57
|
5.9
|
%
|
-7.6
|
%
|
-
|
Declaration Date
|
|
Type
|
|
Record Date
|
|
Payment Date
|
|
Per Share
Amount |
|
Dividends Paid
|
August 10, 2023
|
|
Quarterly
|
|
September 15, 2023
|
|
September 29, 2023
|
|
$ 0.23
|
|
$ 1,429,374
|
August 10, 2023
|
|
Special
|
|
September 15, 2023
|
|
September 29, 2023
|
|
$ 0.40
|
|
$ 2,485,869
|
Declaration Date
|
|
Type
|
|
Record Date
|
|
Payment Date
|
|
Shares
|
August 10, 2023
|
|
Quarterly
|
|
September 15, 2023
|
|
September 29, 2023
|
|
12
|
August 10, 2023
|
|
Special
|
|
September 15, 2023
|
|
September 29, 2023
|
|
21
|
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk
|
Change in Interest Rates
|
Interest Income
|
Interest expense
|
Net Income/(Loss)
|
|||||||||
Up 300 basis points
|
$
|
1,523
|
$
|
-
|
$
|
1,523
|
||||||
Up 200 basis points
|
1,015
|
-
|
1,015
|
|||||||||
Up 100 basis points
|
508
|
-
|
508
|
|||||||||
Down 100 basis points
|
(508
|
)
|
-
|
(508
|
)
|
|||||||
Down 200 basis points
|
(972
|
)
|
-
|
(972
|
)
|
|||||||
Down 300 basis points
|
(1,246
|
)
|
-
|
(1,246
|
)
|
Item 1. |
Legal Proceedings
|
Item 1A. |
Risk Factors
|
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds
|
Item 3. |
Defaults Upon Senior Securities
|
Item 4. |
Mine Safety Disclosures
|
Item 5. |
Other Information
|
Item 6. |
Exhibits
|
Exhibit
Number
|
Description of Exhibit
|
Articles of Amendment and Restatement of the Company(1)
|
|
Amended and Restated Bylaws of the Company(1)
|
|
Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
|
|
Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
|
|
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
|
|
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
|
(1) |
Incorporated by reference to the Company’s annual report on Form 10-K/A, filed on June 30, 2022.
|
SILVER SPIKE INVESTMENT CORP.
|
|||
By:
|
/s/ Scott Gordon
|
||
Scott Gordon
|
|||
Chief Executive Officer (Principal Executive Officer)
|
|||
By:
|
/s/ Umesh Mahajan
|
||
Umesh Mahajan
|
|||
Chief Financial Officer (Principal Financial and Accounting Officer)
|
Date: November 9, 2023
|
By:
|
/s/ Scott Gordon
|
Scott Gordon
|
||
Chief Executive Officer
(Principal Executive Officer)
|
Date: November 9, 2023
|
By:
|
/s/ Umesh Mahajan
|
Umesh Mahajan
|
||
Chief Financial Officer
(Principal Financial Officer)
|
Date: November 9, 2023
|
By:
|
/s/ Scott Gordon
|
Scott Gordon
|
||
Chief Executive Officer
(Principal Executive Officer)
|
Date: November 9, 2023
|
By:
|
/s/ Umesh Mahajan
|
Umesh Mahajan
|
||
Chief Financial Officer
(Principal Financial Officer)
|
Statements of Assets and Liabilities (Parenthetical) - USD ($) |
Sep. 30, 2023 |
Dec. 31, 2022 |
Sep. 30, 2022 |
[1] | Jun. 15, 2021 |
||
---|---|---|---|---|---|---|---|
ASSETS | |||||||
Amortized cost | $ 57,488,336 | $ 50,527,898 | |||||
NET ASSETS | |||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |||||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | |||||
Common stock, shares issued (in shares) | 6,214,705 | 6,214,672 | 386 | ||||
Common stock, shares outstanding (in shares) | 6,214,705 | 6,214,672 | 6,214,672 | ||||
Investment, Unaffiliated Issuer [Member] | |||||||
ASSETS | |||||||
Amortized cost | $ 57,488,336 | $ 50,527,898 | |||||
|
Statements of Changes in Net Assets (Parenthetical) |
9 Months Ended |
---|---|
Sep. 30, 2022
USD ($)
| |
Statements of Changes in Net Assets [Abstract] | |
Offering costs | $ 1,609,184 |
Schedule of Investments (Parenthetical) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended | ||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Dec. 31, 2022 |
|||||||||||||||||
Investment, Identifier [Axis]: AYR Wellness Inc. Senior Secured Notes Due12102024 Fixed Interest Rate 12.5% | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Fixed interest rate | [1] | 12.50% | ||||||||||||||||
Percentage of net assets | [2] | 2.05% | ||||||||||||||||
Investment, Identifier [Axis]: Curaleaf Holdings, Inc. Senior Secured Notes Due12152026 Fixed Interest Rate 8% | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Fixed interest rate | [1] | 8.00% | 8.00% | |||||||||||||||
Percentage of net assets | [2] | 4.60% | 4.46% | |||||||||||||||
Investment, Identifier [Axis]: Dreamfields Brands, Inc. Senior Secured First Lien Term Loan Due5/3/2026 Variable Interest Rate Prime Spread 8.75% PRIME Floor 7.5% | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Basis spread on variable rate | [1] | 8.75% | ||||||||||||||||
Floor rate | [1] | 7.50% | ||||||||||||||||
Percentage of net assets | [2] | 4.80% | ||||||||||||||||
Investment, Identifier [Axis]: Investments And Cash Equivalents | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Percentage of net assets | 99.78% | 98.74% | ||||||||||||||||
Investment, Identifier [Axis]: MariMed Inc. Senior Secured First Lien Term Loan Due 01/24/2026 Variable Interest Rate Prime Spread 5.75% Prime Floor 6.25% Paid-in-Kind 1.40% | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Basis spread on variable rate | [1] | 5.75% | ||||||||||||||||
Floor rate | [1] | 6.25% | ||||||||||||||||
Percentage of net assets | [2] | 4.71% | ||||||||||||||||
PIK Interest Rate | [1] | 1.40% | ||||||||||||||||
Investment, Identifier [Axis]: Non Qualifying Assets | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Percentage of net assets | [3] | 27.60% | ||||||||||||||||
Aggregate fair value of securities | [3] | $ 24,596 | ||||||||||||||||
Investment, Identifier [Axis]: PharmaCann, Inc. Senior Secured Loan Due 6/30/2025 Fixed interest rate 12% | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Fixed interest rate | [1] | 12.00% | 12.00% | |||||||||||||||
Percentage of net assets | [2] | 4.43% | 4.59% | |||||||||||||||
Investment, Identifier [Axis]: STIIIZY Inc Senior Secured First Lien Term Loan Due5262026 Variable Interest Rate Prime Spread 8.5% Prime Floor 4.0% PIK 1.0% | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Basis spread on variable rate | [1],[4] | 8.50% | ||||||||||||||||
Floor rate | [1] | 4.00% | ||||||||||||||||
Percentage of net assets | [2] | 23.58% | ||||||||||||||||
PIK Interest Rate | [1] | 1.00% | ||||||||||||||||
Investment, Identifier [Axis]: Shryne Group, Inc. Senior Secured First Lien Term Loan Due 5/26/2026 Variable Interest Rate Prime Spread 8.5% Prime Floor 4.0% | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Basis spread on variable rate | [1],[5] | 8.50% | ||||||||||||||||
Floor rate | [1] | 4.00% | ||||||||||||||||
Percentage of net assets | [2] | 23.44% | ||||||||||||||||
Investment, Identifier [Axis]: State Street Institutional U.S. Government Money Market Fund | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Percentage of net assets | 34.12% | [6] | 40.62% | [7] | ||||||||||||||
Percentage of annualized seven-day yield | 5.29% | [6] | 4.12% | [7] | ||||||||||||||
Annualized period of yield | 7 days | [6] | 7 days | [7] | ||||||||||||||
Investment, Identifier [Axis]: Verano Holdings Corp Senior Secured First Lien Term Loan Due10302026 Variable Interest Rate Prime Spread65 Prime Floor625 | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Basis spread on variable rate | [1] | 6.50% | [4] | 6.50% | [5] | |||||||||||||
Floor rate | [1] | 6.25% | 6.25% | |||||||||||||||
Percentage of net assets | [2] | 23.54% | 23.58% | |||||||||||||||
Investment, Identifier [Axis]: Wholesale Trade Debt Securities | ||||||||||||||||||
Investments [Abstract] | ||||||||||||||||||
Percentage of net assets | 65.66% | 58.12% | ||||||||||||||||
Prime rate | 8.50% | [4] | 7.50% | [5] | ||||||||||||||
|
ORGANIZATION |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
ORGANIZATION [Abstract] | |
ORGANIZATION |
NOTE 1 — ORGANIZATION
Silver Spike Investment Corp. (an emerging growth company) (the “Company”, “we” or “our”) was formed on January 25, 2021
as a Maryland corporation structured as an externally managed, closed-end, non-diversified management investment company. The Company has elected to be treated as a business development company (“BDC”), under the Investment Company Act of 1940,
as amended (“1940 Act”). In addition, for U.S. federal income tax purposes the Company adopted an initial tax year end of December 31, 2021, and was taxed as a corporation for the tax period ended December 31, 2021. The Company adopted the tax
year end of March 31, 2022 and elected to be treated for U.S. federal income tax purposes as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”) for the tax period January 1,
2022 through March 31, 2022, as well as maintain such election in future taxable years. However, there is no guarantee that the Company will qualify to make such an election for any taxable year.
On February 4, 2022, the Company’s common stock began trading on the Nasdaq Global Market under the ticker symbol “SSIC,” and we completed our initial public
offering of 6,214,286 shares of our common stock, par value $0.01, inclusive of an over-allotment option that was exercised on March 1, 2022 (“IPO”), for approximately $87 million.
The Company is managed by Silver Spike Capital, LLC (“SSC” or “Adviser”), a registered investment advisor under the Investment Advisers Act of 1940 with the
Securities and Exchange Commission. SSC has engaged SS&C Technologies, Inc. and ALPS Fund Services, Inc. (“SS&C”), as sub-administrator, to perform administrative services necessary for the Company to operate.
The Company’s investment objective is to maximize risk-adjusted returns on equity for its shareholders. The Company seeks to drive return on equity by generating
current income from debt investments and capital appreciation from equity and equity-related investments. The Company intends to achieve its investment objective by investing primarily in secured debt, unsecured debt, equity warrants and direct
equity investments in private leveraged middle-market cannabis companies and other companies in the health and wellness sector. The debt investments are often secured by either a first or second priority lien on the assets of the portfolio
company, can include either fixed or floating rate terms and will generally have a term of between
and six years from the original investment date.On November 8, 2022, the Board of Directors (“Board”) of the Company approved a change in its fiscal year end from March 31 to December 31. Certain prior period information has been reclassified to conform to the current period presentation.
|
SIGNIFICANT ACCOUNTING POLICIES |
9 Months Ended | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||||||||||
SIGNIFICANT ACCOUNTING POLICIES |
NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”),
including the requirements under ASC 946, Financial Services—Investment Companies and Articles 6 and 12 of Regulation S-X. In the opinion of management, all adjustments of a normal recurring nature considered necessary for the fair presentation of the financial statements have been made. The current period’s results of
operations are not necessarily indicative of results that may be achieved for the year.
Use of Estimates
The preparation of the financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions affecting reported amounts of assets and liabilities at the date of the financial statements (i.e. fair value of investments) and the reported amounts of income, expenses, and gains and losses
during the reported period. These estimates are based on the information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results could
differ materially from those estimates under different assumptions and conditions.
Investment Valuation
The Company’s investments are recorded at their estimated fair value on the Statement of Assets and Liabilities. Investments for which market
quotations are readily available will typically be valued at the bid price of those market quotations. To validate market quotations, we utilize a number of factors to determine if the quotations are representative of fair value, including the
source and number of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available are valued at fair value as determined in good faith by the Adviser, as the Company’s valuation designee
(the “Valuation Designee”), based on inputs that may include valuations, or ranges of valuations, provided by independent third-party valuation firm(s) engaged by the Adviser. Generally, the valuation approach used for debt investments is the
income approach. The approach derives a value based on either determining the present value of a projected level of cash flow, including a terminal value, or by the capitalization of a normalized measure of future cash flow. The discounted cash
flow (“DCF”) method, one of the methodologies under the income approach, involves estimating future cash flows under various scenarios and discounting them to the measurement date. The discount rate represents a return required by a market
participant in order to make an investment in the subject company.
Alternatively, the market approach or asset approach may be used. The market approach is a way of determining a value indication by using one or
more methods that compare the portfolio company to similar businesses. Value indicators are applied to relevant financial information of the entity being valued to estimate its fair value. There are two methodologies to consider under the market
approach: the guideline company method (“GCM”) and the controlling transaction method (“CTM”). The GCM is based on the premise that the pricing multiples of comparable publicly traded companies can be used as a tool to value privately held
companies. The publicly traded companies’ ratios and business enterprise value provide guidance in the valuation process. Considerations of factors such as size, growth, profitability and return on investment are also analyzed and compared to the
subject business. The CTM is based on the same premise as the GCM. Guideline transactions include change-of-control transactions involving public or private businesses for companies engaged in similar lines of business or with similar economic
characteristics. The valuation considers the price at which the merger or acquisition took place to other factors in order to create a pricing multiple that can be used to determine an estimate of value for the subject company.
The asset approach provides an indication of the portfolio company’s value by developing a valuation-based balance sheet. This approach requires
adjusting the historical assets and liabilities listed on the U.S. GAAP-based balance sheet to estimated fair values. The excess of assets over liabilities represents the tangible value of the business enterprise. The asset approach does not
consider the relevant earnings capacity of a going concern business.
Effective September 8, 2022, pursuant to Rule 2a-5 under the 1940 Act, the Board designated the Adviser as the Valuation Designee to perform the fair value
determinations for the Company, subject to the oversight of the Board and certain Board reporting and other requirements.
As part of the valuation process, the Adviser takes into account relevant factors in determining the fair value of our investments, including: the estimated
enterprise value of a portfolio company (i.e., the total fair value of the portfolio company’s debt and equity), the nature and realizable value of any collateral, the portfolio company’s ability to make payments based on its earnings and cash
flow, the markets in which the portfolio company does business, a comparison of the portfolio company’s securities to any similar publicly traded securities, and overall changes in the interest rate environment and the credit markets. When an
external event such as a purchase transaction, public offering or subsequent equity sale occurs, the Adviser considers whether the pricing indicated by the external event corroborates its valuation.
The Adviser undertakes a multi-step valuation process, which includes, among other procedures, the following:
We conduct this valuation process on a quarterly basis.
We apply Financial Accounting Standards Board Accounting Standards Codification 820, Fair Value Measurement (“ASC 820”),
which establishes a framework for measuring fair value in accordance with U.S. GAAP and required disclosures of fair value measurements. ASC 820 determines fair value to be the price that would be received for an investment in a current sale,
which assumes an orderly transaction between market participants on the measurement date. Market participants are defined as buyers and sellers in the principal or most advantageous market (which may be a hypothetical market) that are
independent, knowledgeable, and willing and able to transact. In accordance with ASC 820, we consider the principal market to be the market that has the greatest volume and level of activity. ASC 820 specifies a fair value hierarchy that
prioritizes and ranks the level of observability of inputs used in determination of fair value. In accordance with ASC 820, these levels are summarized below:
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
fluctuate from period to period. Additionally, the fair value of such investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that
may ultimately be realized. Further, such investments are generally less liquid than publicly traded securities and may be subject to contractual and other restrictions on resale. If we were required to liquidate a portfolio investment in a
forced or liquidation sale, it could realize amounts that are different from the amounts presented and such differences could be material.
In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on
these investments to be different than the unrealized gains or losses reflected previously.
Cash and Cash Equivalents
Cash and cash equivalents consists of funds deposited with financial institutions and short-term (maturity of 90 days or less) liquid investments and money market
funds. Funds held in money market funds are considered Level 1 in the fair value hierarchy in accordance with ASC 820. Cash held in demand deposit accounts may exceed the Federal Deposit Insurance Corporation (“FDIC”) insured limit. The Company
has not incurred any losses on these accounts, and the credit risk exposure is mitigated by the financial strength of the banking institution where the amounts are held. As of September 30, 2023 and December 31, 2022, cash and cash equivalents
consisted of $29.82 million and $35.13
million, respectively, of which $29.82 million and $35.13 million, respectively, was held in the State Street Institutional U.S. Government Money Market Fund.
Earnings per share
Basic earnings per share is computed by dividing net increase (decrease) in net assets resulting from operations by the
weighted-average number of common shares outstanding for the period. Other potentially dilutive common shares, and the related impact to earnings are considered when calculating earnings per share on a diluted basis.
Investment Transactions
Investment transactions are recorded on trade date. Realized gains or losses are recognized as the difference between the net proceeds received (excluding prepayment
fees, if any) and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments written off during the period, net of recoveries.
Current-period changes in fair value of investments are reflected as a component of the net change in unrealized appreciation (depreciation) on investments on the Statements of Operations. The net change in unrealized appreciation (depreciation)
primarily reflects the change in investment fair values as of the last business day of the reporting period, including the reversal of previously recorded unrealized gains or losses with respect to investments realized during the period.
Investments traded but not yet settled, if any, are reported in payable for investments purchased and receivable for investments sold on the Statement of Assets and
Liabilities.
Interest and Dividend Income
Interest income is recorded on the accrual basis and includes accretion and amortization of discounts or premiums, respectively. Discounts and premiums to par value
on securities purchased are accreted and amortized, respectively, into interest income over the contractual life of the respective security using the effective yield method. The amortized cost of investments includes the original cost adjusted
for the accretion and amortization of discounts and premiums, respectively. Upon prepayment of a loan or debt security, any prepayment premiums and unamortized discounts or premiums are recorded as interest income in the current period.
When a debt security becomes 90 days or more past due, or if management otherwise does not expect that principal, interest, and other obligations due will be
collected in full, the Company will generally place the debt security on non-accrual status and cease recognizing interest income on that debt security until all principal and interest due has been paid or the Company believes the borrower has
demonstrated the ability to repay its current and future contractual obligations. Any uncollected interest is reversed from income in the period that collection of the interest receivable is determined to be doubtful. However, the Company may
make exceptions to this policy if the investment has sufficient collateral value and is in the process of collection. As of September 30, 2023 and December 31, 2022, there were no loan investments in the portfolio placed on non-accrual status.
We typically receive debt investment origination or closing fees in connection with investments. Such debt investment origination and closing fees are capitalized as
unearned income and offset against investment cost basis on our Statements of Assets and Liabilities and accreted into interest income using the effective yield method over the term of the investment. Upon the prepayment of a debt investment, any
unaccreted debt investment origination and closing fees are accelerated into interest income.
Interest income earned, excluding accretion of discounts and amortization of premiums, was $2,756,231
and $7,674,961 for the three and nine months ended September 30, 2023. Interest income earned, excluding accretion of discounts and
amortization of premiums, was $1,140,058 and $1,540,214 for the three and nine months ended September 30, 2022. As of September 30, 2023 and December 31, 2022, $1,829,675
and $1,559,081, respectively were recorded as interest receivable.
Dividend income on preferred equity securities is recorded on the accrual basis to the extent that such amounts are payable by the portfolio company and are
expected to be collected. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies.
Certain investments may have contractual PIK interest or dividends. PIK interest or dividends represents accrued interest or dividends that is added to the principal
amount of the investment on the respective interest or dividend payment dates rather than being paid in cash and generally becomes due at maturity. If PIK interest or dividends are not expected to be realized by the Company, the investment
generating PIK interest or dividends will be placed on non-accrual status. When an investment with PIK is placed on non-accrual status, the accrued, uncapitalized interest or dividends are generally reversed through interest or dividend income,
respectively.
Fee Income
All transaction fees earned in connection with our investments are recognized as fee income and are generally non-recurring. Such fees typically include fees for
services, including administrative, structuring and advisory services, provided to portfolio companies. We recognize income from fees for providing such structuring and advisory services when the services are rendered or the transactions are
completed.
For the three and nine months ended September 30, 2023,
the Company earned $31,250 and $162,500,
respectively, in fee income. For the three and nine months ended September 30, 2022, the Company earned $0 and $410,000, respectively, in fee income.
Income Taxes
The Company adopted an initial tax year end of December 31, 2021 and was taxed as a corporation for U.S. federal income tax purposes for the tax period ended
December 31, 2021. The Company adopted the tax year end of March 31, 2022 and elected to be treated for U.S. federal income tax purposes as a RIC under Subchapter M of the Code for the tax period January 1, 2022 through March 31, 2022, and
intends to maintain such election in the current and future taxable years. To maintain its tax treatment as a RIC, the Company must meet specified source-of-income and asset diversification requirements and timely distribute to its stockholders
for each taxable year at least 90% of its investment company taxable income. In order for the Company not to be subject to U.S.
federal excise taxes, it must distribute annually an amount at least equal to the sum of (i) 98% of its net ordinary income for the
calendar year, (ii) 98.2% of its capital gains in excess of capital losses for the one-year period ending on October 31 of the
calendar year and (iii) any net ordinary income and capital gains in excess of capital losses for preceding years that were not distributed during such years. The Company, at its discretion (subject to the requirement to distribute 90% of its investment company taxable income as described above), may carry forward taxable income in excess of calendar year dividends and pay a 4% nondeductible U.S. federal excise tax on this income. If the Company chooses to do so, this generally would increase expenses and reduce the
amount available to be distributed to stockholders. As of September 30, 2023 and December 31, 2022, $0 and $80,566 of accrued excise taxes remained payable.
The Company evaluates tax positions taken in the course of preparing the Company’s tax returns to determine whether the tax
positions are “more-likely-than-not” to be sustained by the applicable tax authority in accordance with ASC Topic 740, Income Taxes (“ASC 740”). Tax benefits of positions not deemed to meet the more-likely-than-not threshold, or uncertain tax positions, would be recorded as
tax expense in the current year. It is the Company’s policy to recognize accrued interest and penalties related to uncertain tax benefits in income tax expense.
Based on the analysis of the Company’s tax position, the Company has no uncertain tax positions that met the recognition or measurement criteria as of September 30, 2023 and December 31, 2022. The Company does not anticipate any significant increase or decrease in
unrecognized tax benefits for the next twelve months. All of the Company’s tax returns remain subject to examination by U.S. federal and state tax authorities.
Distributions
Distributions to common stockholders are recorded on the record date. The amount of taxable income to be paid out as a distribution is determined by our Board of Directors each quarter and is generally based upon the future taxable income estimated by management. Capital gains, if any, are distributed at least annually, although the Company may decide to retain all or some of those capital gains for investment and pay U.S. federal income tax at corporate rates on those retained amounts. If the Company chooses to do so, this generally will increase expenses and reduce the amount available to be distributed to stockholders. Our distributions may exceed our earnings, and therefore, portions of the distributions that we make may be a return of the money originally invested and represent a return of capital distribution to shareholders for tax purposes. Organization Expenses and Offering Costs
Organizational expenses
Costs associated with the organization of the Company are expensed as incurred. These expenses consist primarily of legal fees and other costs of organizing the
Company.
For the three and nine months ended September 30, 2023, the Company did not incur organizational expenses. For the three and nine months ended September 30, 2022, the Company incurred organizational expenses of $0 and $34,168, respectively. As of September 30, 2023 and
December 31, 2022, there were no unpaid organizational expenses.
Offering costs
These costs consist primarily of legal fees and other costs incurred in connection with the Company’s share offerings, the preparation of the Company’s
registration statement, and registration fees.
Costs associated with the offering of common shares of the Company are capitalized as deferred offering and, if any, are included in deferred offering costs on the
Statements of Assets and Liabilities. Costs of approximately $0 and $1,690,184 were charged to capital upon the completion of the Company’s public offering during the three and nine months ended September 30, 2022.
For the three and nine months ended September 30, 2023, no offering costs were charged to capital. As of September 30, 2023 and
December 31, 2022, there were no unpaid offering costs.
New Accounting Standards
Management does not believe any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying
financial statements.
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INVESTMENTS |
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INVESTMENTS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENTS |
NOTE 3 — INVESTMENTS
The Company seeks to invest in portfolio companies primarily in the form of loans (secured and unsecured), but may include equity warrants and direct equity
investments. The loans typically pay interest with some amortization of principal. As of September 30, 2023, 86.0% of the portfolio
(based on amortized cost) pays interest on a floating rate basis with a PRIME floor, and 14.0% of the portfolio (based on amortized
cost) pays fixed interest. As of December 31, 2022, 80.9% of the portfolio (based on amortized cost) pays interest on a floating rate
basis with a PRIME floor, and 19.1% of the portfolio (based on amortized cost) pays fixed interest. We will generally seek to obtain
security interests in the assets of our portfolio companies that serve as collateral in support of the repayment of these loans. This collateral may take the form of first or second priority liens on the assets of a portfolio company. In some of
our portfolio investments, we expect to receive nominally priced equity warrants and/or make direct equity investments in connection with a debt investment. In addition, a portion of our portfolio may be comprised of derivatives, including total
return swaps.
We expect that our loans will typically have final maturities of
to six years. However, we expect that our portfolio companies often may repay these loans early, generally within three years from the date of initial investment.Portfolio Composition
The Company’s portfolio investments are in companies conducting business in or supporting the cannabis industries. The following tables summarize the composition of
the Company’s portfolio investments by industry at amortized cost and fair value and as a percentage of the total portfolio as of September 30, 2023 and December 31, 2022.
The geographic composition is determined by the location of headquarters of the portfolio company. The following tables summarize the composition of the Company’s
portfolio investments by geographic region of the United States at amortized cost and fair value and as a percentage of the total portfolio as of September 30, 2023 and December 31, 2022. Geographic regions are defined as: West, for the states
of WA, OR, ID, MT, WY, CO, AK, HI, UT, NV and CA; Midwest, for the states ND, SD, NE, KS, MO, IA, MN, WI, MI, IL, IN and OH; Northeast, for the states PA, NJ, NY, CT, RI, MA, VT, NH and ME; Southeast, for the states of AR, LA, MS, TN, KY, AL, FL,
GA, SC, NC, VA, DE, WV and MD; and Southwest, for the states of AZ, NM, TX and OK.
The following tables summarize the composition of the Company’s portfolio investments by investment type at amortized cost and fair value and as a percentage of the
total portfolio as of September 30, 2023 and December 31, 2022.
Certain Risk Factors
In the ordinary course of business, the Company manages a variety of risks including market risk, credit risk, liquidity risk, interest rate risk, prepayment risk,
risks associated with financial, economic and other global market developments and disruptions, including those arising from war, terrorism, market manipulation, government interventions, defaults and shutdowns, political changes or diplomatic
developments, public health emergencies (such as the spread of infectious diseases, pandemics and epidemics) and natural/environmental disasters, which can all negatively impact the securities markets generally. These events can also impair the
technology and other operational systems upon which the Company's service providers rely and could otherwise disrupt the Company’s service providers' ability to fulfill their obligations to the Company. The Company identifies, measures and
monitors risk through various control mechanisms, including trading limits and diversifying exposures and activities across a variety of instruments, markets and counterparties.
Market risk is the risk of potential adverse changes to the value of financial instruments because of changes in market conditions, including as a result of changes
in the credit quality of a particular issuer, credit spreads, interest rates, and other movements and volatility in security prices or commodities. In particular, the Company may invest in issuers that are experiencing or have experienced
financial or business difficulties (including difficulties resulting from the initiation or prospect of significant litigation or bankruptcy proceedings), which involves significant risks. The Company manages its exposure to market risk through
the use of risk management strategies and various analytical monitoring techniques.
Concentration risk is the risk that the
Company’s focus on investments in cannabis companies may subject the Company to greater price volatility and risk of loss as a result of adverse economic, business or other developments affecting cannabis companies than funds investing in a
broader range of industries or sectors. At times, the performance of investments in cannabis companies will lag the performance of other industries or sectors or the broader market as a whole.
Credit risk is the risk that a decline in the credit quality of an investment could cause the Company to lose money. The Company could lose money if the issuer or
guarantor of a portfolio security fails to make timely payment or otherwise honor its obligations. Fixed income securities rated below investment grade (high-yield bonds) involve greater risks of default or downgrade and are generally more
volatile than investment grade securities. Below investment grade securities involve greater risk of price declines than investment grade securities due to actual or perceived changes in an issuer’s creditworthiness. In addition, issuers of below
investment grade securities may be more susceptible than other issuers to economic downturns. Such securities are subject to the risk that the issuer may not be able to pay interest or dividends and ultimately to repay principal upon maturity.
Discontinuation of these payments could substantially adversely affect the market value of the security.
The Company’s investments may, at any time, include securities and other financial instruments or obligations that are illiquid or thinly traded, making purchase or
sale of such securities and financial instruments at desired prices or in desired quantities difficult. Furthermore, the sale of any such investments may be possible only at substantial discounts, and it may be extremely difficult to value any
such investments accurately.
Interest rate risk refers to the change in earnings that may result from changes in the level of interest rates. To the extent that the Company borrows money to make
investments, including under any credit facility, net investment income (loss) will be affected by the difference between the rate at which the Company borrows funds and the rate at which the Company invests these funds. In periods of rising
interest rates, the Company’s cost of borrowing funds would increase, which may reduce net investment income (loss). As a result, there can be no assurance that a significant change in market interest rates will not have a material adverse effect
on net investment income (loss).
Prepayment risk is the risk that a loan in the Company’s portfolio will prepay due to the existence of favorable financing market conditions that allow the portfolio
company the ability to replace existing financing with less expensive capital. As market conditions change, prepayment may be possible for each portfolio company. In some cases, the prepayment of a loan may reduce the Company’s achievable yield
if the capital returned cannot be invested in transactions with equal or greater expected yields, which could have a material adverse effect on our business, financial condition and results of operations.
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FAIR VALUE OF FINANCIAL INSTRUMENTS |
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FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS |
NOTE 4 — FAIR VALUE OF FINANCIAL INSTRUMENTS
ASC 820 defines fair value, establishes a framework for measuring fair value, and establishes a fair value hierarchy based on the quality of inputs used to measure
fair value and enhances disclosure requirements for fair value measurements. The Company accounts for its investments at fair value. As of September 30, 2023 and December 31, 2022, the Company’s portfolio investments consisted of investments in
secured loans and secured notes. The fair value amounts have been measured as of the reporting date and have not been reevaluated or updated for purposes of these financial statements subsequent to that date. As such, the fair values of these
financial instruments subsequent to the reporting date may be different than amounts reported.
In accordance with ASC 820, the Company has categorized its investments based on the priority of the inputs to the valuation technique into a three-level fair value
hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical investments (Level 1) and the lowest priority to unobservable inputs (Level 3).
As required by ASC 820, when the inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement
is categorized is based on the lowest level input that is significant to the fair value measurement in its entirety. For example, a Level 3 fair value measurement may include inputs that are observable (Levels 1 and 2) and unobservable (Level 3).
Therefore, the fair value related to such investments categorized within the Level 3 tables below may include components of the fair value that are attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3). The
fair value determination of each portfolio investment categorized as Level 3 required one or more unobservable inputs.
The use of significant unobservable inputs creates uncertainty in the measurement of fair value as of the reporting date. The significant unobservable inputs used in
the fair value measurement of the Company’s investments may vary and may include debt investments’ yield (i.e. discount rate) and volatility assumptions.
The Company’s investments measured at fair value by investment type on a recurring basis as of September 30, 2023 were as follows:
The Company’s investments measured at fair value by investment type on a recurring basis as of December 31, 2022 were as follows:
The following tables provide a summary of the significant unobservable inputs used to fair value the Level 3 portfolio investments as of September 30, 2023 and
December 31, 2022. The methodology for the determination of the fair value of the Company’s investments is discussed in “Note 2 – Significant Accounting Policies”. Discount Rate ranges are shown as spread over PRIME and Treasuries, respectively,
for Senior Secured First Lien Term Loans, as of September 30, 2023 and December 31, 2022.
(1) The weighted average is calculated based on the fair
value of each investment.
Significant increases (decreases) in discount rate in isolation would result in a significantly lower (higher) fair value assessment. Significant increases
(decreases) in volatility in isolation would result in a significantly lower (higher) fair value assessment.
The following table provides a summary of changes in the fair value of the Company’s Level 3 portfolio investments for the nine months ended September 30, 2023:
The following table provides a summary of changes in the fair value of the
Company’s Level 3 portfolio investments for the nine months ended September 30, 2022:
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RELATED PARTY TRANSACTIONS |
9 Months Ended |
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Sep. 30, 2023 | |
RELATED PARTY TRANSACTIONS [Abstract] | |
RELATED PARTY TRANSACTIONS |
NOTE 5 — RELATED PARTY TRANSACTIONS
Pursuant
to the investment advisory agreement between the Company and SSC (the “Investment Advisory Agreement”), fees payable to SSC are equal to (a) a base management fee of 1.75% of the average value of the Company’s gross assets at the end of the two
most recent quarters (i.e., total assets held before deduction of any liabilities), which includes investments acquired with the use of leverage and excludes cash and cash equivalents and (b) an incentive fee based on the Company’s
performance. The incentive fee consists of two parts. The first part is calculated and payable quarterly in arrears and equals 20% of the Company’s “Pre-Incentive Fee Net Investment Income” for the quarter, subject to a preferred return, or “hurdle,” of 1.75% per quarter (7% annualized),
and a “catch-up” feature. The second part is determined and payable in arrears as of the end of each fiscal year (or upon termination of the Investment Advisory Agreement) and equals 20% of the Company’s realized capital gains on a cumulative basis from inception through the end of the fiscal year, if any, computed net of all realized capital losses
and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fee (the “Incentive Fee on Capital Gains”).
While the Investment Advisory Agreement neither includes nor contemplates the inclusion of unrealized gains in the calculation of the Incentive Fee on Capital
Gains, as required by U.S. GAAP, we accrue the Incentive Fee on Capital Gains on unrealized capital appreciation exceeding unrealized depreciation. This accrual reflects the Incentive Fee on Capital Gains that would be payable to SSC if the
Company’s entire investment portfolio was liquidated at its fair value as of the balance sheet date even though SSC is not entitled to an Incentive Fee on Capital Gains with respect to unrealized capital appreciation unless and until such gains
are actually realized.
The management fee is payable quarterly in arrears. For the three and nine months ended September 30, 2023, the Company incurred management fee expenses of $264,565 and $760,473,
respectively. For the three and nine months ended September 30, 2022, the Company incurred management fee expenses of $110,426
and $165,467, respectively. As of September 30, 2023 and December 31, 2022, $264,565 and $170,965, respectively, remained payable.
For the three and nine months ended September 30, 2023, the Company incurred income-based incentive fee expenses of $405,247 and $1,051,741, respectively. For the three and
nine months ended September 30, 2022, the Company did not incur any income-based incentive fee expenses. As of September 30,
2023 and December 31, 2022, $1,051,741 and $0, respectively, remained payable.
For the three and nine
months ended September 30, 2023, the Company incurred capital gains incentive fee expenses of $(5,000) and $0, respectively. For the three and nine months ended September 30, 2022, the Company did not incur any capital gains incentive fee expenses. As of September 30, 2023 and December 31, 2022, no amount remained payable.
Pursuant
to the administration agreement between the Company and SSC (the “Administration Agreement”), the Company is to reimburse the administrator, SSC, for the costs and expenses incurred by SSC in performing its obligations, including but not
limited to maintaining and keeping all books and records and providing personnel and facilities. This includes costs and expenses incurred by SSC in connection with the delegation of its obligations to SS&C, the sub-administrator. The
Company is generally not responsible for the compensation of SSC’s employees or any overhead expenses. However, we may reimburse SSC for an allocable portion of the compensation paid by SSC to our CCO and CFO and their respective staffs
(based on a percentage of time such individuals devote, on an estimated basis, to our business affairs). For the three and nine months ended September 30, 2023 and 2022, the Adviser has waived any expense reimbursement, other than those
associated with the delegation of its obligations to the sub-administrator.
Due to affiliate in the accompanying Statements of Assets and Liabilities in the amount of $298 and $37 as of September 30, 2023
and December 31, 2022, respectively, is due to SSC for expenses paid on the Company’s behalf. For the three and nine months ended September 30, 2023, the
Company paid $4,993 and $6,192,
respectively, as reimbursement to SSC for expenses paid on the Company’s behalf. For the three and nine months ended September 30, 2022, the Company paid $1,075 and $388,559, respectively, for expenses on SSC’s behalf. As of
September 30, 2023 and December 31, 2022 there were amounts due from affiliates. For the three and nine months ended September
30, 2023, there were no amounts received by the Company that were due from affiliates.
SSC was the seed investor of the Company and provided initial funding to the Company by purchasing approximately $63 million of the Company’s common stock in the Company’s initial public offering. SSC provided this “seed capital” to the Company for the purpose of facilitating the launch
and initial operation of the Company, as opposed to for long term investment purposes. SSC does not expect to hold the Company’s common stock indefinitely, and may sell the Company’s common stock at a future point in time. In order for SSC’s
sales of the shares of the Company not to be deemed to have been made “on the basis of” material nonpublic information, such sales may be made pursuant to a pre-approved trading plan that complies with Rule 10b5-1 under the Exchange Act and that
may obligate SSC to make recurring sales of the Company’s common stock on a periodic basis. Sales of substantial amounts of the Company’s common stock, including by SSC or other large stockholders, or the availability of such common stock for
sale, could adversely affect the prevailing market prices for the Company’s common stock. If this occurs and continues for a sustained period of time, it could impair the Company’s ability to raise additional capital through the sale of
securities, should the Company desire to do so.
SSC holds approximately 72% of the Company’s voting
stock and has the ability to exercise substantial control over all corporate actions requiring stockholder approval, including the election and removal of directors, certain amendments of the Company’s charter, the Company’s ability to issue its
common stock at a price below NAV per share, and the approval of any merger or other extraordinary corporate action.
SSC has agreed to absorb $2.07 million, the cost of
the sales load (i.e., underwriting discounts and commissions) incurred by the Company in connection with the initial public offering of its common stock.
During the three and nine months ended September 30, 2023, SSC and certain related parties received quarterly and special dividend distributions from the Company
relating to their shares held. Refer to “Note 7 – Common Stock” for further details on the Company’s dividend reinvestment plan and the distributions declared.
|
COMMITMENTS AND CONTINGENCIES |
9 Months Ended |
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Sep. 30, 2023 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES |
NOTE 6 — COMMITMENTS AND CONTINGENCIES
Commitments and contingencies have been reviewed and the Company has identified
commitments or contingencies as of September 30, 2023 and December 31, 2022. |
COMMON STOCK |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMON STOCK [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMON STOCK |
NOTE 7 — COMMON STOCK
In connection with its formation, the Company authorized 100,000,000
shares of its common stock with a par value of $0.01 per share. On June 15, 2021, the Company was initially capitalized by the issuance
of 386 shares of its common stock for an aggregate purchase price of $5,400 to SSC.
Initial Public Offering
On February 4, 2022, the Company completed its initial public offering of 6,214,286 shares of common stock at a price of $14.00
per share, inclusive of the underwriters’ option to purchase additional shares, which was exercised on March 1, 2022, and raised capital of approximately $85 million (net of approximately $2
million of offering costs).
Distributions
The following table summarizes distributions declared and/or paid by the Company during the three and nine months ended September 30, 2023:
During the three and nine months ended September 30, 2022, the Company did not have any distributions.
Dividend Reinvestment Plan
The Company’s dividend reinvestment plan (“DRIP”) provides for the reinvestment of distributions in the form of common stock on behalf of its stockholders, unless a
stockholder has elected to receive distributions in cash. As a result, if the Company declares a cash distribution, its stockholders who have not “opted out” of the DRIP by the opt out date will have their cash distribution automatically
reinvested into additional shares of the Company’s common stock. The share requirements of the DRIP may be satisfied through the issuance of common shares or through open market purchases of common shares by the DRIP plan administrator.
The Company’s DRIP is administered by its transfer agent on behalf of the
Company’s record holders and participating brokerage firms. Brokerage firms and other financial intermediaries may decide not to participate in the Company’s DRIP but may provide a similar dividend reinvestment plan for their clients.
During
the three and nine months ended September 30, 2023, the Company issued the following shares of common stock under the DRIP:
During the three and nine months ended September 30, 2022, the Company issued no new shares of common stock under the DRIP.
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INDEMNIFICATION |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
INDEMNIFICATION [Abstract] | |
INDEMNIFICATION |
NOTE 8 — INDEMNIFICATION
Under the Company’s organizational documents, the Company’s officers and directors are indemnified against certain liabilities arising out of the performance of
their duties to the Company. In addition, in the normal course of business the Company enters into contracts that contain a variety of representations which provide general indemnifications. The Company’s maximum exposure under these agreements
cannot be known; however, the Company expects any risk of loss to be remote.
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EARNINGS PER SHARE |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER SHARE [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER SHARE |
NOTE 9 — EARNINGS PER SHARE
The following table sets forth the computation of the weighted average basic and diluted net increase (decrease) in net assets per share from operations for the
three and nine months ended September 30, 2023 and 2022:
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INCOME TAXES |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES |
NOTE 10 — INCOME TAXES
The Company
adopted a tax year end of March 31, with March 31, 2022 being the first tax period end for this elected tax year end. The Company elected to be treated as a regulated investment company (“RIC”) for U.S. federal income tax purposes under
Subchapter M of the Code for the tax period January 1, 2022 through March 31, 2022, and intends to maintain such election in future taxable years. However, there is no guarantee that the Company will qualify to make such an election for any
taxable year. As a RIC, the Company generally will not pay corporate-level income tax if it distributes to stockholders at least 90% of its investment company taxable income (“ICTI”) (which is generally its net ordinary taxable income and
realized net short-term capital gains in excess of realized net long-term capital losses) and 90% of its tax-exempt income to maintain its RIC status. Depending on the level of ICTI earned in a tax year, the Company may choose to carry
forward ICTI in excess of the current year distribution into the next tax year. Any such carryover ICTI must be distributed before the end of that next tax year through a dividend declared prior to filing the final tax return related to the
year which generated such ICTI. The amount to be paid out as a distribution is determined by the Company’s Directors each quarter and is based upon the annual earnings estimated by the management of the Company. To the extent the Company’s
earnings fall below the amount of dividend distributions declared, however, a portion of the total amount of the Company’s distributions for the tax year may be deemed a return of capital for tax purposes to the Company’s stockholders.
The Company’s taxable income for each period is an estimate and will not be finally determined until the Company files its tax return
for each tax year. Therefore, the final taxable income earned in each tax year and carried forward for distribution in the following tax year may be different than this estimate.
Because federal
income tax regulations differ from GAAP, distributions in accordance with tax regulations may differ from net investment income (loss) and realized gains recognized for financial reporting purposes. Differences may be permanent or temporary in
nature. Permanent differences are reclassified among the capital accounts in the financial statements to reflect their appropriate tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized in
different periods for book and tax purposes.
As of March 31, 2023, the Company’s most recent tax year end, the Company had no
capital loss carryforwards for federal income tax purposes.
For income tax purposes, distributions paid to shareholders are reported as ordinary income, return of capital, long-term capital gains, or a combination thereof. For the six month period ending September 30, 2023, the Company had ordinary income
distributions of $3,914,922, however the final determination of the tax character of distributions will not be made until we file our
tax return for the tax year ending March 31, 2024. There were no distributions paid for the tax year ended March 31, 2023.
For the tax year ended March 31, 2023, the Company reclassified $121,099
from distributable earnings to additional paid-in-capital on the Statement of Assets and Liabilities arising from permanent book to tax differences primarily related to prior year post-financial statement updates and non-deductible excise
tax. For the tax year ended March 31, 2022, the Company reclassified $295,235 from distributable earnings to additional
paid-in-capital on the Statement of Assets and Liabilities arising from permanent book to tax differences primarily related to prior year post-financial statement updates and non-deductible excise tax.
As of March 31, 2023, the components of distributable earnings on a tax basis detailed below differ from the
amounts reflected in the Company’s Statements of Assets and Liabilities by temporary book or tax differences primarily arising from the tax treatment of organizational costs.
The following table sets forth the tax cost basis and the estimated aggregate gross unrealized appreciation and depreciation from investments
and cash equivalents for federal income tax purposes for the six months ended September 30, 2023, the tax year ended March 31, 2023, and the fiscal year ended December 31, 2022:
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FINANCIAL HIGHLIGHTS |
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL HIGHLIGHTS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL HIGHLIGHTS |
NOTE 11 — FINANCIAL HIGHLIGHTS
The Company was formed on January 25, 2021 and the effective date of our registration statement was February 3, 2022. Prior to February 3, 2022, the Company had no
operations, except for matters relating to our formation and organization as a BDC. The following presents financial highlights for the nine months ended September 30, 2023 and the period from February 3, 2022 to September 30, 2022:
|
SUBSEQUENT EVENTS |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
SUBSEQUENT EVENTS [Abstract] | |
SUBSEQUENT EVENTS |
NOTE 12 — SUBSEQUENT EVENTS
The Company’s management evaluated subsequent events through the date on which the financial statements were issued. Other than the item listed below, there have
been no subsequent events that occurred during such period that have required adjustment or disclosure in the financial statements.
On November 8, 2023, the Company’s Board approved a special dividend of $0.45/share and a regular dividend of $0.25/share. The dividends are payable
on December 29, 2023 to stockholders of record on December 20, 2023.
|
SIGNIFICANT ACCOUNTING POLICIES (Policies) |
9 Months Ended | ||||||||||||||
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Sep. 30, 2023 | |||||||||||||||
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||||||||||
Basis of Presentation |
Basis of Presentation
The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”),
including the requirements under ASC 946, Financial Services—Investment Companies and Articles 6 and 12 of Regulation S-X. In the opinion of management, all adjustments of a normal recurring nature considered necessary for the fair presentation of the financial statements have been made. The current period’s results of
operations are not necessarily indicative of results that may be achieved for the year.
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Use of Estimates |
Use of Estimates
The preparation of the financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions affecting reported amounts of assets and liabilities at the date of the financial statements (i.e. fair value of investments) and the reported amounts of income, expenses, and gains and losses
during the reported period. These estimates are based on the information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results could
differ materially from those estimates under different assumptions and conditions.
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Investment Valuation |
Investment Valuation
The Company’s investments are recorded at their estimated fair value on the Statement of Assets and Liabilities. Investments for which market
quotations are readily available will typically be valued at the bid price of those market quotations. To validate market quotations, we utilize a number of factors to determine if the quotations are representative of fair value, including the
source and number of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available are valued at fair value as determined in good faith by the Adviser, as the Company’s valuation designee
(the “Valuation Designee”), based on inputs that may include valuations, or ranges of valuations, provided by independent third-party valuation firm(s) engaged by the Adviser. Generally, the valuation approach used for debt investments is the
income approach. The approach derives a value based on either determining the present value of a projected level of cash flow, including a terminal value, or by the capitalization of a normalized measure of future cash flow. The discounted cash
flow (“DCF”) method, one of the methodologies under the income approach, involves estimating future cash flows under various scenarios and discounting them to the measurement date. The discount rate represents a return required by a market
participant in order to make an investment in the subject company.
Alternatively, the market approach or asset approach may be used. The market approach is a way of determining a value indication by using one or
more methods that compare the portfolio company to similar businesses. Value indicators are applied to relevant financial information of the entity being valued to estimate its fair value. There are two methodologies to consider under the market
approach: the guideline company method (“GCM”) and the controlling transaction method (“CTM”). The GCM is based on the premise that the pricing multiples of comparable publicly traded companies can be used as a tool to value privately held
companies. The publicly traded companies’ ratios and business enterprise value provide guidance in the valuation process. Considerations of factors such as size, growth, profitability and return on investment are also analyzed and compared to the
subject business. The CTM is based on the same premise as the GCM. Guideline transactions include change-of-control transactions involving public or private businesses for companies engaged in similar lines of business or with similar economic
characteristics. The valuation considers the price at which the merger or acquisition took place to other factors in order to create a pricing multiple that can be used to determine an estimate of value for the subject company.
The asset approach provides an indication of the portfolio company’s value by developing a valuation-based balance sheet. This approach requires
adjusting the historical assets and liabilities listed on the U.S. GAAP-based balance sheet to estimated fair values. The excess of assets over liabilities represents the tangible value of the business enterprise. The asset approach does not
consider the relevant earnings capacity of a going concern business.
Effective September 8, 2022, pursuant to Rule 2a-5 under the 1940 Act, the Board designated the Adviser as the Valuation Designee to perform the fair value
determinations for the Company, subject to the oversight of the Board and certain Board reporting and other requirements.
As part of the valuation process, the Adviser takes into account relevant factors in determining the fair value of our investments, including: the estimated
enterprise value of a portfolio company (i.e., the total fair value of the portfolio company’s debt and equity), the nature and realizable value of any collateral, the portfolio company’s ability to make payments based on its earnings and cash
flow, the markets in which the portfolio company does business, a comparison of the portfolio company’s securities to any similar publicly traded securities, and overall changes in the interest rate environment and the credit markets. When an
external event such as a purchase transaction, public offering or subsequent equity sale occurs, the Adviser considers whether the pricing indicated by the external event corroborates its valuation.
The Adviser undertakes a multi-step valuation process, which includes, among other procedures, the following:
We conduct this valuation process on a quarterly basis.
We apply Financial Accounting Standards Board Accounting Standards Codification 820, Fair Value Measurement (“ASC 820”),
which establishes a framework for measuring fair value in accordance with U.S. GAAP and required disclosures of fair value measurements. ASC 820 determines fair value to be the price that would be received for an investment in a current sale,
which assumes an orderly transaction between market participants on the measurement date. Market participants are defined as buyers and sellers in the principal or most advantageous market (which may be a hypothetical market) that are
independent, knowledgeable, and willing and able to transact. In accordance with ASC 820, we consider the principal market to be the market that has the greatest volume and level of activity. ASC 820 specifies a fair value hierarchy that
prioritizes and ranks the level of observability of inputs used in determination of fair value. In accordance with ASC 820, these levels are summarized below:
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
fluctuate from period to period. Additionally, the fair value of such investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that
may ultimately be realized. Further, such investments are generally less liquid than publicly traded securities and may be subject to contractual and other restrictions on resale. If we were required to liquidate a portfolio investment in a
forced or liquidation sale, it could realize amounts that are different from the amounts presented and such differences could be material.
In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on
these investments to be different than the unrealized gains or losses reflected previously.
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Cash and Cash Equivalents |
Cash and Cash Equivalents
Cash and cash equivalents consists of funds deposited with financial institutions and short-term (maturity of 90 days or less) liquid investments and money market
funds. Funds held in money market funds are considered Level 1 in the fair value hierarchy in accordance with ASC 820. Cash held in demand deposit accounts may exceed the Federal Deposit Insurance Corporation (“FDIC”) insured limit. The Company
has not incurred any losses on these accounts, and the credit risk exposure is mitigated by the financial strength of the banking institution where the amounts are held. As of September 30, 2023 and December 31, 2022, cash and cash equivalents
consisted of $29.82 million and $35.13
million, respectively, of which $29.82 million and $35.13 million, respectively, was held in the State Street Institutional U.S. Government Money Market Fund.
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Earnings per share |
Earnings per share
Basic earnings per share is computed by dividing net increase (decrease) in net assets resulting from operations by the
weighted-average number of common shares outstanding for the period. Other potentially dilutive common shares, and the related impact to earnings are considered when calculating earnings per share on a diluted basis.
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Investment Transactions |
Investment Transactions
Investment transactions are recorded on trade date. Realized gains or losses are recognized as the difference between the net proceeds received (excluding prepayment
fees, if any) and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments written off during the period, net of recoveries.
Current-period changes in fair value of investments are reflected as a component of the net change in unrealized appreciation (depreciation) on investments on the Statements of Operations. The net change in unrealized appreciation (depreciation)
primarily reflects the change in investment fair values as of the last business day of the reporting period, including the reversal of previously recorded unrealized gains or losses with respect to investments realized during the period.
Investments traded but not yet settled, if any, are reported in payable for investments purchased and receivable for investments sold on the Statement of Assets and
Liabilities.
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Interest and Dividend Income |
Interest and Dividend Income
Interest income is recorded on the accrual basis and includes accretion and amortization of discounts or premiums, respectively. Discounts and premiums to par value
on securities purchased are accreted and amortized, respectively, into interest income over the contractual life of the respective security using the effective yield method. The amortized cost of investments includes the original cost adjusted
for the accretion and amortization of discounts and premiums, respectively. Upon prepayment of a loan or debt security, any prepayment premiums and unamortized discounts or premiums are recorded as interest income in the current period.
When a debt security becomes 90 days or more past due, or if management otherwise does not expect that principal, interest, and other obligations due will be
collected in full, the Company will generally place the debt security on non-accrual status and cease recognizing interest income on that debt security until all principal and interest due has been paid or the Company believes the borrower has
demonstrated the ability to repay its current and future contractual obligations. Any uncollected interest is reversed from income in the period that collection of the interest receivable is determined to be doubtful. However, the Company may
make exceptions to this policy if the investment has sufficient collateral value and is in the process of collection. As of September 30, 2023 and December 31, 2022, there were no loan investments in the portfolio placed on non-accrual status.
We typically receive debt investment origination or closing fees in connection with investments. Such debt investment origination and closing fees are capitalized as
unearned income and offset against investment cost basis on our Statements of Assets and Liabilities and accreted into interest income using the effective yield method over the term of the investment. Upon the prepayment of a debt investment, any
unaccreted debt investment origination and closing fees are accelerated into interest income.
Interest income earned, excluding accretion of discounts and amortization of premiums, was $2,756,231
and $7,674,961 for the three and nine months ended September 30, 2023. Interest income earned, excluding accretion of discounts and
amortization of premiums, was $1,140,058 and $1,540,214 for the three and nine months ended September 30, 2022. As of September 30, 2023 and December 31, 2022, $1,829,675
and $1,559,081, respectively were recorded as interest receivable.
Dividend income on preferred equity securities is recorded on the accrual basis to the extent that such amounts are payable by the portfolio company and are
expected to be collected. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies.
Certain investments may have contractual PIK interest or dividends. PIK interest or dividends represents accrued interest or dividends that is added to the principal
amount of the investment on the respective interest or dividend payment dates rather than being paid in cash and generally becomes due at maturity. If PIK interest or dividends are not expected to be realized by the Company, the investment
generating PIK interest or dividends will be placed on non-accrual status. When an investment with PIK is placed on non-accrual status, the accrued, uncapitalized interest or dividends are generally reversed through interest or dividend income,
respectively.
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Fee Income |
Fee Income
All transaction fees earned in connection with our investments are recognized as fee income and are generally non-recurring. Such fees typically include fees for
services, including administrative, structuring and advisory services, provided to portfolio companies. We recognize income from fees for providing such structuring and advisory services when the services are rendered or the transactions are
completed.
For the three and nine months ended September 30, 2023,
the Company earned $31,250 and $162,500,
respectively, in fee income. For the three and nine months ended September 30, 2022, the Company earned $0 and $410,000, respectively, in fee income.
|
||||||||||||||
Income Taxes |
Income Taxes
The Company adopted an initial tax year end of December 31, 2021 and was taxed as a corporation for U.S. federal income tax purposes for the tax period ended
December 31, 2021. The Company adopted the tax year end of March 31, 2022 and elected to be treated for U.S. federal income tax purposes as a RIC under Subchapter M of the Code for the tax period January 1, 2022 through March 31, 2022, and
intends to maintain such election in the current and future taxable years. To maintain its tax treatment as a RIC, the Company must meet specified source-of-income and asset diversification requirements and timely distribute to its stockholders
for each taxable year at least 90% of its investment company taxable income. In order for the Company not to be subject to U.S.
federal excise taxes, it must distribute annually an amount at least equal to the sum of (i) 98% of its net ordinary income for the
calendar year, (ii) 98.2% of its capital gains in excess of capital losses for the one-year period ending on October 31 of the
calendar year and (iii) any net ordinary income and capital gains in excess of capital losses for preceding years that were not distributed during such years. The Company, at its discretion (subject to the requirement to distribute 90% of its investment company taxable income as described above), may carry forward taxable income in excess of calendar year dividends and pay a 4% nondeductible U.S. federal excise tax on this income. If the Company chooses to do so, this generally would increase expenses and reduce the
amount available to be distributed to stockholders. As of September 30, 2023 and December 31, 2022, $0 and $80,566 of accrued excise taxes remained payable.
The Company evaluates tax positions taken in the course of preparing the Company’s tax returns to determine whether the tax
positions are “more-likely-than-not” to be sustained by the applicable tax authority in accordance with ASC Topic 740, Income Taxes (“ASC 740”). Tax benefits of positions not deemed to meet the more-likely-than-not threshold, or uncertain tax positions, would be recorded as
tax expense in the current year. It is the Company’s policy to recognize accrued interest and penalties related to uncertain tax benefits in income tax expense.
Based on the analysis of the Company’s tax position, the Company has no uncertain tax positions that met the recognition or measurement criteria as of September 30, 2023 and December 31, 2022. The Company does not anticipate any significant increase or decrease in
unrecognized tax benefits for the next twelve months. All of the Company’s tax returns remain subject to examination by U.S. federal and state tax authorities.
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Distributions |
Distributions
Distributions to common stockholders are recorded on the record date. The amount of taxable income to be paid out as a distribution is determined by our Board of Directors each quarter and is generally based upon the future taxable income estimated by management. Capital gains, if any, are distributed at least annually, although the Company may decide to retain all or some of those capital gains for investment and pay U.S. federal income tax at corporate rates on those retained amounts. If the Company chooses to do so, this generally will increase expenses and reduce the amount available to be distributed to stockholders. Our distributions may exceed our earnings, and therefore, portions of the distributions that we make may be a return of the money originally invested and represent a return of capital distribution to shareholders for tax purposes. |
||||||||||||||
Organization Expenses and Offering Costs |
Organization Expenses and Offering Costs
Organizational expenses
Costs associated with the organization of the Company are expensed as incurred. These expenses consist primarily of legal fees and other costs of organizing the
Company.
For the three and nine months ended September 30, 2023, the Company did not incur organizational expenses. For the three and nine months ended September 30, 2022, the Company incurred organizational expenses of $0 and $34,168, respectively. As of September 30, 2023 and
December 31, 2022, there were no unpaid organizational expenses.
Offering costs
These costs consist primarily of legal fees and other costs incurred in connection with the Company’s share offerings, the preparation of the Company’s
registration statement, and registration fees.
Costs associated with the offering of common shares of the Company are capitalized as deferred offering and, if any, are included in deferred offering costs on the
Statements of Assets and Liabilities. Costs of approximately $0 and $1,690,184 were charged to capital upon the completion of the Company’s public offering during the three and nine months ended September 30, 2022.
For the three and nine months ended September 30, 2023, no offering costs were charged to capital. As of September 30, 2023 and
December 31, 2022, there were no unpaid offering costs.
|
||||||||||||||
New Accounting Standards |
New Accounting Standards
Management does not believe any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying
financial statements.
|
INVESTMENTS (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENTS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Portfolio Investments |
The Company’s portfolio investments are in companies conducting business in or supporting the cannabis industries. The following tables summarize the composition of
the Company’s portfolio investments by industry at amortized cost and fair value and as a percentage of the total portfolio as of September 30, 2023 and December 31, 2022.
The geographic composition is determined by the location of headquarters of the portfolio company. The following tables summarize the composition of the Company’s
portfolio investments by geographic region of the United States at amortized cost and fair value and as a percentage of the total portfolio as of September 30, 2023 and December 31, 2022. Geographic regions are defined as: West, for the states
of WA, OR, ID, MT, WY, CO, AK, HI, UT, NV and CA; Midwest, for the states ND, SD, NE, KS, MO, IA, MN, WI, MI, IL, IN and OH; Northeast, for the states PA, NJ, NY, CT, RI, MA, VT, NH and ME; Southeast, for the states of AR, LA, MS, TN, KY, AL, FL,
GA, SC, NC, VA, DE, WV and MD; and Southwest, for the states of AZ, NM, TX and OK.
The following tables summarize the composition of the Company’s portfolio investments by investment type at amortized cost and fair value and as a percentage of the
total portfolio as of September 30, 2023 and December 31, 2022.
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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments Measured at Fair Value by Investment Type on Recurring Basis |
The Company’s investments measured at fair value by investment type on a recurring basis as of September 30, 2023 were as follows:
The Company’s investments measured at fair value by investment type on a recurring basis as of December 31, 2022 were as follows:
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Significant Unobservable Inputs used in Fair Value Measurement Level 3 Portfolio Investments |
The following tables provide a summary of the significant unobservable inputs used to fair value the Level 3 portfolio investments as of September 30, 2023 and
December 31, 2022. The methodology for the determination of the fair value of the Company’s investments is discussed in “Note 2 – Significant Accounting Policies”. Discount Rate ranges are shown as spread over PRIME and Treasuries, respectively,
for Senior Secured First Lien Term Loans, as of September 30, 2023 and December 31, 2022.
(1) The weighted average is calculated based on the fair
value of each investment.
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Changes in Fair Value of Level 3 Portfolio Investments |
The following table provides a summary of changes in the fair value of the Company’s Level 3 portfolio investments for the nine months ended September 30, 2023:
The following table provides a summary of changes in the fair value of the
Company’s Level 3 portfolio investments for the nine months ended September 30, 2022:
|
COMMON STOCK (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||
COMMON STOCK [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Summary of Distributions Declared and/or Paid |
The following table summarizes distributions declared and/or paid by the Company during the three and nine months ended September 30, 2023:
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Schedule of Distribution Reinvestment Plan [Table Text Block] | During
the three and nine months ended September 30, 2023, the Company issued the following shares of common stock under the DRIP:
|
EARNINGS PER SHARE (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER SHARE [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of Weighted Average Basic and Diluted Net Increase (Decrease) in Net Assets Per Share from Operations |
The following table sets forth the computation of the weighted average basic and diluted net increase (decrease) in net assets per share from operations for the
three and nine months ended September 30, 2023 and 2022:
|
INCOME TAXES (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Accumulated Losses |
As of March 31, 2023, the components of distributable earnings on a tax basis detailed below differ from the
amounts reflected in the Company’s Statements of Assets and Liabilities by temporary book or tax differences primarily arising from the tax treatment of organizational costs.
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Investments and Cash Equivalents for Federal Income tax |
The following table sets forth the tax cost basis and the estimated aggregate gross unrealized appreciation and depreciation from investments
and cash equivalents for federal income tax purposes for the six months ended September 30, 2023, the tax year ended March 31, 2023, and the fiscal year ended December 31, 2022:
|
FINANCIAL HIGHLIGHTS (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL HIGHLIGHTS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Highlights | The following presents financial highlights for the nine months ended September 30, 2023 and the period from February 3, 2022 to September 30, 2022:
|
ORGANIZATION (Details) - USD ($) $ / shares in Units, $ in Millions |
Feb. 04, 2022 |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|---|
Debt Instruments [Abstract] | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
IPO [Member] | |||
Debt Instruments [Abstract] | |||
Number of shares issued (in shares) | 6,214,286 | ||
Common stock, par value (in dollars per share) | $ 0.01 | ||
Shares issued | $ 87 | ||
Minimum [Member] | |||
Debt Instruments [Abstract] | |||
Debt investments term period | 2 years | ||
Maximum [Member] | |||
Debt Instruments [Abstract] | |||
Debt investments term period | 6 years |
SIGNIFICANT ACCOUNTING POLICIES, Cash and Cash Equivalents (Details) - USD ($) |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Cash and Cash Equivalents [Abstract] | ||
Cash and cash equivalents | $ 29,820,936 | $ 35,125,320 |
State Street Institutional U.S. Government Money Market Fund [Member] | ||
Cash and Cash Equivalents [Abstract] | ||
Cash and cash equivalents | $ 29,820,000 | $ 35,130,000 |
SIGNIFICANT ACCOUNTING POLICIES, Interest and Dividend Income (Details) - USD ($) |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||
Investments held by the Company | $ 0 | $ 0 | $ 0 | ||
Interest income earned, excluding accretion of discounts | 2,756,231 | $ 1,140,058 | 7,674,961 | $ 1,540,214 | |
Interest receivable | $ 1,829,675 | $ 1,829,675 | $ 1,559,081 |
SIGNIFICANT ACCOUNTING POLICIES, Fee Income (Details) - USD ($) |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ||||
Fee income | $ 31,250 | $ 0 | $ 162,500 | $ 410,000 |
SIGNIFICANT ACCOUNTING POLICIES, Income Taxes (Details) - USD ($) |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2023 |
Dec. 31, 2022 |
|
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Percentage of taxable income and gain planned to be distributed by company | 90.00% | |
Minimum percentage of ordinary income | 98.00% | |
Minimum percentage of capital gains | 98.20% | |
Federal excise tax rate based on distribution requirements | 4.00% | |
Accrued exercise taxes payable | $ 0 | $ 80,566 |
Increase or decrease in unrecognized tax benefits | $ 0 | $ 0 |
Minimum [Member] | ||
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Percentage of taxable income and gain planned to be distributed by company | 90.00% |
SIGNIFICANT ACCOUNTING POLICIES, Organization Expenses and Offering Costs (Details) - USD ($) |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||
Organizational expenses | $ 0 | $ 0 | $ 0 | $ 34,168 | |
Organizational expenses unpaid | 0 | 0 | $ 0 | ||
Offering costs charged to capital | 0 | $ 0 | 0 | $ 1,690,184 | |
Offering costs unpaid | $ 0 | $ 0 | $ 0 |
INVESTMENTS (Details) - USD ($) |
9 Months Ended | |
---|---|---|
Sep. 30, 2023 |
Dec. 31, 2022 |
|
Investments, Loans [Abstract] | ||
Percent of portfolio that is variable rate | 86.00% | 80.90% |
Percent of portfolio that is fixed rate | 14.00% | 19.10% |
Loan repayment period | 3 years | |
Amortized Cost [Abstract] | ||
Amount | $ 57,488,336 | $ 50,527,898 |
Percentage | 100.00% | 100.00% |
Fair Value [Abstract] | ||
Amount | $ 57,381,000 | $ 50,254,550 |
Percentage | 100.00% | 100.00% |
Minimum [Member] | ||
Investments, Loans [Abstract] | ||
Loans maturity period | 3 years | |
Maximum [Member] | ||
Investments, Loans [Abstract] | ||
Loans maturity period | 6 years | |
Senior Secured First Lien Term Loan [Member] | ||
Amortized Cost [Abstract] | ||
Amount | $ 49,445,187 | $ 40,871,914 |
Percentage | 86.00% | 80.90% |
Fair Value [Abstract] | ||
Amount | $ 49,497,000 | $ 40,660,633 |
Percentage | 86.30% | 80.90% |
Senior Secured Notes [Member] | ||
Amortized Cost [Abstract] | ||
Amount | $ 8,043,149 | $ 9,655,984 |
Percentage | 14.00% | 19.10% |
Fair Value [Abstract] | ||
Amount | $ 7,884,000 | $ 9,593,917 |
Percentage | 13.70% | 19.10% |
Midwest [Member] | ||
Amortized Cost [Abstract] | ||
Amount | $ 24,578,030 | $ 24,420,752 |
Percentage | 42.80% | 48.40% |
Fair Value [Abstract] | ||
Amount | $ 24,447,500 | $ 24,358,686 |
Percentage | 42.60% | 48.50% |
West [Member] | ||
Amortized Cost [Abstract] | ||
Amount | $ 24,834,972 | $ 20,479,987 |
Percentage | 43.20% | 40.50% |
Fair Value [Abstract] | ||
Amount | $ 24,804,000 | $ 20,268,705 |
Percentage | 43.20% | 40.30% |
Northeast [Member] | ||
Amortized Cost [Abstract] | ||
Amount | $ 8,075,334 | $ 3,854,475 |
Percentage | 14.00% | 7.60% |
Fair Value [Abstract] | ||
Amount | $ 8,129,500 | $ 3,854,475 |
Percentage | 14.20% | 7.70% |
Southeast [Member] | ||
Amortized Cost [Abstract] | ||
Amount | $ 1,772,684 | |
Percentage | 3.50% | |
Fair Value [Abstract] | ||
Amount | $ 1,772,684 | |
Percentage | 3.50% | |
Wholesale Trade [Member] | ||
Amortized Cost [Abstract] | ||
Amount | $ 57,488,336 | $ 50,527,898 |
Percentage | 100.00% | 100.00% |
Fair Value [Abstract] | ||
Amount | $ 57,381,000 | $ 50,254,550 |
Percentage | 100.00% | 100.00% |
Investment, Unaffiliated Issuer [Member] | ||
Amortized Cost [Abstract] | ||
Amount | $ 57,488,336 | $ 50,527,898 |
Fair Value [Abstract] | ||
Amount | $ 57,381,000 | $ 50,254,550 |
FAIR VALUE OF FINANCIAL INSTRUMENTS, Investments Measured at Fair Value (Details) - USD ($) |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Assets [Abstract] | ||
Fair value | $ 57,381,000 | $ 50,254,550 |
Senior Secured First Lien Term Loan [Member] | ||
Assets [Abstract] | ||
Fair value | 49,497,000 | 40,660,633 |
Senior Secured Notes [Member] | ||
Assets [Abstract] | ||
Fair value | 7,884,000 | 9,593,917 |
Recurring [Member] | ||
Assets [Abstract] | ||
Fair value | 57,381,000 | 50,254,550 |
Recurring [Member] | Senior Secured First Lien Term Loan [Member] | ||
Assets [Abstract] | ||
Fair value | 49,497,000 | 40,660,633 |
Recurring [Member] | Senior Secured Notes [Member] | ||
Assets [Abstract] | ||
Fair value | 7,884,000 | 9,593,917 |
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) Member | ||
Assets [Abstract] | ||
Fair value | 0 | 0 |
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) Member | Senior Secured First Lien Term Loan [Member] | ||
Assets [Abstract] | ||
Fair value | 0 | 0 |
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) Member | Senior Secured Notes [Member] | ||
Assets [Abstract] | ||
Fair value | 0 | 0 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Assets [Abstract] | ||
Fair value | 0 | 0 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Senior Secured First Lien Term Loan [Member] | ||
Assets [Abstract] | ||
Fair value | 0 | 0 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Senior Secured Notes [Member] | ||
Assets [Abstract] | ||
Fair value | 0 | 0 |
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Assets [Abstract] | ||
Fair value | 57,381,000 | 50,254,550 |
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Senior Secured First Lien Term Loan [Member] | ||
Assets [Abstract] | ||
Fair value | 49,497,000 | 40,660,633 |
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Senior Secured Notes [Member] | ||
Assets [Abstract] | ||
Fair value | $ 7,884,000 | $ 9,593,917 |
FAIR VALUE OF FINANCIAL INSTRUMENTS, Significant Unobservable Inputs used in Fair Value Measurement Level 3 Portfolio Investments (Details) |
Sep. 30, 2023
USD ($)
|
Dec. 31, 2022
USD ($)
|
||
---|---|---|---|---|
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Fair value | $ 57,381,000 | $ 50,254,550 | ||
Senior Secured First Lien Term Loan [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Fair value | $ 49,497,000 | $ 40,660,633 | ||
Senior Secured First Lien Term Loan [Member] | Discounted Cash Flow [Member] | Discount Rate [Member] | Minimum [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | 0.116 | 0.072 | ||
Senior Secured First Lien Term Loan [Member] | Discounted Cash Flow [Member] | Discount Rate [Member] | Maximum [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | 0.153 | 0.096 | ||
Senior Secured First Lien Term Loan [Member] | Discounted Cash Flow [Member] | Discount Rate [Member] | Weighted Average [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | [1] | 0.132 | 0.084 | |
Senior Secured First Lien Term Loan [Member] | Discounted Cash Flow [Member] | Volatility [Member] | Minimum [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | 0.20 | |||
Senior Secured First Lien Term Loan [Member] | Discounted Cash Flow [Member] | Volatility [Member] | Maximum [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | 0.20 | |||
Senior Secured First Lien Term Loan [Member] | Discounted Cash Flow [Member] | Volatility [Member] | Weighted Average [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | [1] | 0.20 | ||
Senior Secured Notes [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Fair value | $ 7,884,000 | $ 9,593,917 | ||
Senior Secured Notes [Member] | Discounted Cash Flow [Member] | Discount Rate [Member] | Minimum [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | 0.079 | 0.116 | ||
Senior Secured Notes [Member] | Discounted Cash Flow [Member] | Discount Rate [Member] | Maximum [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | 0.142 | 0.187 | ||
Senior Secured Notes [Member] | Discounted Cash Flow [Member] | Discount Rate [Member] | Weighted Average [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | [1] | 0.11 | 0.143 | |
Senior Secured Notes [Member] | Discounted Cash Flow [Member] | Volatility [Member] | Minimum [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | 0.07 | |||
Senior Secured Notes [Member] | Discounted Cash Flow [Member] | Volatility [Member] | Maximum [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | 0.20 | |||
Senior Secured Notes [Member] | Discounted Cash Flow [Member] | Volatility [Member] | Weighted Average [Member] | ||||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||||
Measurement Input | [1] | 0.124 | ||
|
FAIR VALUE OF FINANCIAL INSTRUMENTS, Summary of Changes in Fair Value of Level 3 Portfolio Investments (Details) - USD ($) |
9 Months Ended | |
---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Changes in Fair Value of Level 3 Portfolio Investments [Abstract] | ||
Fair value, beginning of period | $ 50,254,550 | $ 0 |
Purchases | 8,442,000 | 24,417,500 |
Accretion of discount and fees (amortization of premium), net | 431,052 | 49,966 |
PIK interest | 78,153 | 0 |
Proceeds from sales of investments and principal repayments | (1,780,000) | 0 |
Net realized gain (loss) on investments | (210,767) | 0 |
Net change in unrealized appreciation (depreciation) on investments | 166,012 | 0 |
Fair value, end of period | 57,381,000 | 24,467,466 |
Net change in unrealized appreciation/depreciation on Level 3 investments still held as of September 30 | 166,012 | 0 |
Senior Secured First Lien Term Loan [Member] | ||
Changes in Fair Value of Level 3 Portfolio Investments [Abstract] | ||
Fair value, beginning of period | 40,660,633 | 0 |
Purchases | 8,442,000 | 24,417,500 |
Accretion of discount and fees (amortization of premium), net | 233,119 | 49,966 |
PIK interest | 78,153 | 0 |
Proceeds from sales of investments and principal repayments | (180,000) | 0 |
Net realized gain (loss) on investments | 0 | 0 |
Net change in unrealized appreciation (depreciation) on investments | 263,095 | 0 |
Fair value, end of period | 49,497,000 | 24,467,466 |
Net change in unrealized appreciation/depreciation on Level 3 investments still held as of September 30 | 263,095 | $ 0 |
Senior Secured Notes [Member] | ||
Changes in Fair Value of Level 3 Portfolio Investments [Abstract] | ||
Fair value, beginning of period | 9,593,917 | |
Purchases | 0 | |
Accretion of discount and fees (amortization of premium), net | 197,933 | |
PIK interest | 0 | |
Proceeds from sales of investments and principal repayments | (1,600,000) | |
Net realized gain (loss) on investments | (210,767) | |
Net change in unrealized appreciation (depreciation) on investments | (97,083) | |
Fair value, end of period | 7,884,000 | |
Net change in unrealized appreciation/depreciation on Level 3 investments still held as of September 30 | $ (97,083) |
RELATED PARTY TRANSACTIONS (Details) |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2023
USD ($)
qtr
|
Sep. 30, 2022
USD ($)
|
Sep. 30, 2023
USD ($)
qtr
|
Sep. 30, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
|
|
Investment Advisory Agreement [Abstract] | |||||
Management fee expenses incurred | $ 264,565 | $ 110,426 | $ 760,473 | $ 165,467 | |
Management fee payable | 264,565 | 264,565 | $ 170,965 | ||
Income-based incentive fee expenses | 405,247 | 0 | 1,051,741 | 0 | |
Income-based incentive fee payable | 1,051,741 | 1,051,741 | 0 | ||
Capital gains incentive fee expenses | (5,000) | 0 | 0 | 0 | |
Capital gains incentive fee payable | 0 | 0 | 0 | ||
Due from affiliate | 0 | ||||
Common stock purchased | 0 | 0 | 0 | 85,269,770 | |
Related Party [Member] | |||||
Investment Advisory Agreement [Abstract] | |||||
Due to affiliate | 298 | 298 | 37 | ||
Due from affiliate | $ 0 | 0 | |||
Silver Spike Capital, LLC [Member] | IPO [Member] | |||||
Investment Advisory Agreement [Abstract] | |||||
Common stock purchased | $ 63,000,000 | ||||
Percentage of voting stock held | 72.00% | 72.00% | |||
Cost of sales incurred | $ 2,070,000.00 | ||||
Investment Advisory Agreement [Member] | |||||
Investment Advisory Agreement [Abstract] | |||||
Percentage of management fee payable | 1.75% | ||||
Number of recent quarters | qtr | 2 | 2 | |||
Duration of incentive fee payable | quarterly | ||||
Percentage payable of Pre-Incentive Fee Net Investment Income | 20.00% | 20.00% | |||
Percentage payable of Pre-Incentive Fee Net Investment Income subject to a preferred return, or "hurdle" per quarter | 1.75% | 1.75% | |||
Percentage of Pre-Incentive Fee Net Investment Income subject to a preferred return, or "hurdle" per annum | 7.00% | 7.00% | |||
Percentage payable of realized capital gains on a cumulative basis | 20.00% | 20.00% | |||
Investment Advisory Agreement [Member] | Related Party [Member] | |||||
Investment Advisory Agreement [Abstract] | |||||
Due to affiliate | $ 298 | $ 298 | $ 37 | ||
Investment Advisory Agreement [Member] | Silver Spike Capital, LLC [Member] | |||||
Investment Advisory Agreement [Abstract] | |||||
Payment of related party expenses | $ 4,993 | $ 1,075 | $ 6,192 | $ 388,559 |
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) |
Sep. 30, 2023 |
Dec. 31, 2022 |
Sep. 30, 2022 |
---|---|---|---|
COMMITMENTS AND CONTINGENCIES [Abstract] | |||
Commitments and contingencies |
COMMON STOCK, Initial Public Offering and Distributions (Details) - USD ($) |
3 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|
Feb. 04, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
Jun. 15, 2021 |
|
COMMON STOCK [Abstract] | |||||||
Common stock shares authorized (in shares) | 100,000,000 | 100,000,000 | 100,000,000 | ||||
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | ||||
Common stock, shares issued (in shares) | 6,214,705 | 6,214,705 | 6,214,672 | 386 | |||
Initial Public Offering [Abstract] | |||||||
Amount of raised capital | $ 85,039,208 | $ 85,039,208 | $ 84,917,788 | $ 5,400 | |||
Offering costs | $ 1,609,184 | ||||||
IPO [Member] | |||||||
COMMON STOCK [Abstract] | |||||||
Common stock par value (in dollars per share) | $ 0.01 | ||||||
Initial Public Offering [Abstract] | |||||||
Number of shares issued (in shares) | 6,214,286 | ||||||
Share price (in dollars per share) | $ 14 | ||||||
Amount of raised capital | $ 85,000,000 | ||||||
Offering costs | $ 2,000,000 | ||||||
Quarterly Dividend [Member] | |||||||
Distributions [Abstract] | |||||||
Declaration date | Aug. 10, 2023 | Aug. 10, 2023 | |||||
Type | Quarterly | Quarterly | |||||
Record date | Sep. 15, 2023 | Sep. 15, 2023 | |||||
Payment date | Sep. 29, 2023 | Sep. 29, 2023 | |||||
Per share amount (in dollars per share) | $ 0.23 | ||||||
Cash dividends paid | $ 1,429,374 | $ 0 | |||||
Special Dividend [Member] | |||||||
Distributions [Abstract] | |||||||
Declaration date | Aug. 10, 2023 | Aug. 10, 2023 | |||||
Type | Special | Special | |||||
Record date | Sep. 15, 2023 | Sep. 15, 2023 | |||||
Payment date | Sep. 29, 2023 | Sep. 29, 2023 | |||||
Per share amount (in dollars per share) | $ 0.4 | ||||||
Cash dividends paid | $ 2,485,869 | $ 0 |
COMMON STOCK, Distribution Reinvestment Plan (Details) - shares |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Quarterly Dividend [Member] | ||||
Distribution Reinvestment Plan [Abstract] | ||||
Shares (in shares) | 12 | 0 | 12 | |
Declaration date | Aug. 10, 2023 | Aug. 10, 2023 | ||
Type | Quarterly | Quarterly | ||
Record date | Sep. 15, 2023 | Sep. 15, 2023 | ||
Payment date | Sep. 29, 2023 | Sep. 29, 2023 | ||
Special Dividend [Member] | ||||
Distribution Reinvestment Plan [Abstract] | ||||
Shares (in shares) | 21 | 21 | 0 | |
Declaration date | Aug. 10, 2023 | Aug. 10, 2023 | ||
Type | Special | Special | ||
Record date | Sep. 15, 2023 | Sep. 15, 2023 | ||
Payment date | Sep. 29, 2023 | Sep. 29, 2023 |
EARNINGS PER SHARE (Details) - USD ($) |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Net Increase (Decrease) in Net Assets Per Share [Abstract] | ||||
Net increase (decrease) in net assets resulting from operations | $ 1,273,882 | $ 559,923 | $ 4,842,366 | $ 556,129 |
Weighted Average Shares Outstanding - Basic (in shares) | 6,214,673 | 6,214,672 | 6,214,672 | 5,338,691 |
Weighted Average Shares Outstanding - Diluted (in shares) | 6,214,673 | 6,214,672 | 6,214,672 | 5,338,691 |
Net increase (decrease) in net assets resulting from operations per share - basic (in dollars per share) | $ 0.2 | $ 0.09 | $ 0.78 | $ 0.1 |
Net increase (decrease) in net assets resulting from operations per share - diluted (in dollars per share) | $ 0.2 | $ 0.09 | $ 0.78 | $ 0.1 |
INCOME TAXES (Details) - USD ($) |
3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
INCOME TAXES [Abstract] | ||||||||
Capital losses | $ 0 | |||||||
Distributions paid | $ 3,914,922 | $ 3,914,922 | $ 0 | 0 | ||||
Income Taxes Summary [Abstract] | ||||||||
Effect of permanent adjustments | $ 0 | $ 0 | 0 | 0 | ||||
Components of Accumulated Losses [Abstract] | ||||||||
Undistributed ordinary income | 3,418,714 | |||||||
Net unrealized appreciation (depreciation) from investments | (107,336) | (107,336) | (107,336) | 713,009 | $ (273,348) | |||
Other temporary differences | (399,948) | |||||||
Total | 3,731,775 | |||||||
Aggregate Gross Unrealized Appreciation and Depreciation from Investments and Cash Equivalents for Federal Income Tax Purposes [Abstract] | ||||||||
Tax cost of investments and cash equivalents | 87,309,272 | 87,309,272 | 87,309,272 | 87,454,317 | 85,653,218 | |||
Unrealized appreciation | 154,529 | 154,529 | 154,529 | 713,009 | 0 | |||
Unrealized depreciation | (261,865) | (261,865) | (261,865) | 0 | (273,348) | |||
Net unrealized appreciation (depreciation) from investments and cash equivalents | (107,336) | $ (107,336) | (107,336) | 713,009 | $ (273,348) | |||
Additional Paid-in Capital [Member] | ||||||||
Income Taxes Summary [Abstract] | ||||||||
Effect of permanent adjustments | 0 | 0 | 121,099 | (295,235) | $ 121,099 | $ 295,235 | ||
Accumulated Loss [Member] | ||||||||
Income Taxes Summary [Abstract] | ||||||||
Effect of permanent adjustments | $ 0 | $ 0 | $ (121,099) | $ 295,235 |
FINANCIAL HIGHLIGHTS (Details) - USD ($) |
8 Months Ended | 9 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2022 |
[1] | Sep. 30, 2023 |
Dec. 31, 2022 |
|||||||||||
Per share data [Roll Forward] | ||||||||||||||
Net asset value at beginning of period (in dollars per share) | $ 14 | $ 13.91 | ||||||||||||
Net investment income (loss) (in dollars per share) | [2] | 0.05 | 0.79 | |||||||||||
Net realized and unrealized gains/(losses) on investments (in dollars per share) | [2] | 0 | (0.01) | |||||||||||
Net increase/(decrease) in net assets resulting from operations (in dollars per share) | 0.05 | 0.78 | ||||||||||||
Offering costs (in dollars per share) | [3] | (0.27) | 0 | |||||||||||
Permanent tax adjustments (in dollars per share) | [3] | (0.05) | 0 | |||||||||||
Less distributions from net investment income (loss) | 0 | (0.63) | ||||||||||||
Net asset value at end of period (in dollars per share) | $ 13.73 | $ 14.06 | ||||||||||||
Net assets at end of period | $ 85,323,750 | $ 87,402,852 | ||||||||||||
Shares outstanding at end of period (in shares) | 6,214,672 | 6,214,705 | 6,214,672 | |||||||||||
Weighted average net assets | $ 84,331,724 | $ 88,458,750 | ||||||||||||
Per share market value at end of period (in dollars per share) | $ 10 | $ 9.68 | ||||||||||||
Total return based on market value | [4] | (28.57%) | (1.22%) | |||||||||||
Total return based on net asset value | [4] | (1.93%) | 7.66% | |||||||||||
Ratio/Supplemental data [Abstract] | ||||||||||||||
Ratio of expenses to average net assets | [5] | 1.68% | 3.82% | |||||||||||
Ratio of net investment income (loss) to average net assets | [5] | 0.69% | 5.52% | |||||||||||
Portfolio turnover | [5] | 3.00% | ||||||||||||
|
SUBSEQUENT EVENTS (Details) - $ / shares |
3 Months Ended | 9 Months Ended | |
---|---|---|---|
Nov. 08, 2023 |
Sep. 30, 2023 |
Sep. 30, 2023 |
|
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Common Stock, Dividends, Per Share, Declared | $ 0.25 | ||
Quarterly Dividend [Member] | |||
Subsequent Event [Line Items] | |||
Common Stock, Dividends, Per Share, Declared | $ 0.23 | ||
Special Dividend [Member] | |||
Subsequent Event [Line Items] | |||
Common Stock, Dividends, Per Share, Declared | $ 0.4 | ||
Special Dividend [Member] | Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Common Stock, Dividends, Per Share, Declared | $ 0.45 |
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