OFS Capital Corp

Previous wording

Our NAV per common share increased to $11.51 at June 30, 2024 from $11.08 at March 31, 2024, due to a net gain on investments of $0.51 per common share, partially offset by our quarterly distribution of $0.34 per common share, which exceeded our quarterly net investment income of $0.26 per common share.

Current wording

Our NAV per common share decreased to $11.29 at September 30, 2024 from $11.51 at June 30, 2024, due to a net loss on investments of $0.15 per common share and our quarterly distribution of $0.34 per common share exceeding our quarterly net investment income of $0.27 per common share.

Previous wording

For the quarter ended June 30, 2024, total investment income decreased to $11.2 million from $14.2 million in the prior quarter, primarily due to a decrease of $2.4 million in dividend income. For the quarter ended June 30, 2024, total interest income decreased to $10.9 million from $11.4 million in the prior quarter, primarily due to a smaller average investment portfolio size at cost. See “—Results of Operations” for additional information.

Current wording

For the quarter ended September 30, 2024, total investment income decreased to $10.9 million from $11.2 million in the prior quarter, primarily due to a decrease of $0.2 million in interest income. For the quarter ended September 30, 2024, interest income decreased to $10.6 million from $10.9 million in the prior quarter, primarily due to a smaller average investment portfolio at cost. See “—Results of Operations” for additional information.

Previous wording

Our total outstanding debt decreased to $249.1 million at June 30, 2024 from $258.5 million at March 31, 2024, due to repayments of $9.4 million on our BNP Facility. For the quarter ended June 30, 2024, our weighted-average debt interest costs increased to 6.5% compared to 6.3% for the quarter ended March 31, 2024, primarily due to the prior quarter repayment of our SBA debentures. As of June 30, 2024, approximately 50% of our outstanding debt matures in 2027 and beyond, and 72% of our outstanding debt carries fixed interest rates and is unsecured.

Current wording

As of September 30, 2024, our total outstanding debt was $249.1 million and remained unchanged compared to our total outstanding debt at June 30, 2024. For the quarter ended September 30, 2024, our weighted-average debt interest costs remained stable at 6.46% compared to 6.45% for the quarter ended June 30, 2024. As of September 30, 2024, approximately 50% of our outstanding debt matures in 2027 and beyond, and 72% of our outstanding debt carries fixed interest rates and is unsecured.

Previous wording

For the quarter ended June 30, 2024, we recognized a net gain on investments of $6.9 million, primarily due to net unrealized appreciation of $11.3 million, partially offset by net realized losses of $4.3 million. For the quarter ended June 30, 2024, our net unrealized appreciation of $11.3 million was primarily related to net unrealized appreciation of $7.8 million on our common equity in Pfanstiehl Holdings, Inc., and net unrealized appreciation of $2.1 million on our subordinated note investment in Apex Credit CLO 2020 Ltd. As of June 30, 2024, our loan portfolio had non-accrual loans with an aggregate fair value of $18.3 million, or 4.6% of our total investments at fair value. See “—Portfolio Composition and Investment Activity” for additional information.

Current wording

For the quarter ended September 30, 2024, we recognized a net loss on investments of $1.9 million, primarily due to net realized losses of $11.1 million, partially offset by net unrealized appreciation of $9.2 million. For the quarter ended September 30, 2024, our net realized loss of $11.1 million was primarily due to a $7.8 million loss upon the write-off of our debt and equity investments in Master Cutlery, LLC, which had no impact on our NAV during the quarter as the loss had been substantially recognized in prior fiscal periods. For the quarter ended September 30, 2024, our net unrealized appreciation of $9.2 million was primarily due to net unrealized appreciation of $2.8 million on our common equity in Pfanstiehl Holdings, Inc., as well as the reversal of previously recognized unrealized depreciation on exited investments. As of September 30, 2024, our loan portfolio had non-accrual loans with an aggregate fair value of $21.1 million, or 5.4% of our total investments at fair value. See “—Portfolio Composition and Investment Activity” for additional information.

Previous wording

As of June 30, 2024, our asset coverage ratio of 162% exceeded the minimum asset coverage requirement of 150% under the 1940 Act, and we remained in compliance with all applicable covenants under our outstanding debt facilities. As of June 30, 2024, we had unused commitments of $25.0 million under our Banc of California Credit Facility, as well as $80.9 million under our BNP Facility, each of which are subject to a borrowing base and other covenants. As of June 30, 2024, we had unfunded commitments of $8.9 million to eight portfolio companies. See “—Liquidity and Capital Resources” for additional information.

Current wording

As of September 30, 2024, our asset coverage ratio of 161% exceeded the minimum asset coverage requirement of 150% under the 1940 Act, and we remained in compliance with all applicable covenants under our outstanding debt facilities. As of September 30, 2024, we had unused commitments of $25.0 million under our Banc of California Credit Facility, as well as $80.9 million under our BNP Facility, each of which is subject to a borrowing base and other covenants. As of September 30, 2024, we had a payable for investments purchased of $14.7 million and unfunded commitments of $8.5 million to eight portfolio companies. See “—Liquidity and Capital Resources” for additional information.

Previous wording

On July 30, 2024, the Board declared a distribution of $0.34 per share for the third quarter of 2024, payable on September 30, 2024 to stockholders of record as of September 20, 2024.

Current wording

On October 29, 2024, the Board declared a distribution of $0.34 per share for the fourth quarter of 2024, payable on December 31, 2024 to stockholders of record as of December 20, 2024.

Previous wording

Our critical accounting policies and estimates are those relating to revenue recognition and fair value estimates. Management has discussed the development and selection of each critical accounting policy and estimate with the Audit Committee of the Board. For descriptions of our revenue recognition and fair value policies, see “Item 8. Financial Statements—Notes to Consolidated Financial Statements—Note 2” and “Item 7. Management's Discussion and Analysis of Financial

Current wording

Our critical accounting policies and estimates are those relating to revenue recognition and fair value estimates. Management has discussed the development and selection of each critical accounting policy and estimate with the Audit Committee of the Board. For descriptions of our revenue recognition and fair value policies, see “Item 8. Financial Statements

Previous wording

Condition and Results of Operations—Critical Accounting Policies and Significant Estimates” in our Annual Report on Form 10-K for the year ended December 31, 2023.

Current wording

—Notes to Consolidated Financial Statements—Note 2” and “Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Significant Estimates” in our Annual Report on Form 10-K for the year ended December 31, 2023.

Previous wording

As of June 30, 2024, the fair value of our debt investment portfolio totaled $236.9 million in 40 portfolio companies, of which approximately 85% and 15% were first lien and second lien debt investments, respectively. We also had equity investments in 16 portfolio companies with a fair value of approximately $85.7 million and 18 investments in Structured Finance Securities with a fair value of $75.6 million. As of June 30, 2024, we had unfunded commitments of $8.9 million to eight portfolio companies. Set forth in the tables and charts below is selected information with respect to our portfolio as of June 30, 2024 and December 31, 2023.

Current wording

As of September 30, 2024, the fair value of our debt investment portfolio totaled $231.1 million in 42 portfolio companies, of which approximately 82% and 18% were first lien and second lien debt investments, respectively. We also had equity investments in 15 portfolio companies with a fair value of approximately $89.8 million and 17 investments in Structured Finance Securities with a fair value of $73.8 million. As of September 30, 2024, we had unfunded commitments of $8.5 million to eight portfolio companies. Set forth in the tables and charts below is selected information with respect to our portfolio as of September 30, 2024 and December 31, 2023.

Previous wording

As of June 30, 2024, our common equity investment in Pfanstiehl Holdings, Inc., a global manufacturer of high-purity pharmaceutical ingredients, accounted for 17.8% and 45.9% of our total portfolio at fair value and our total net assets, respectively. The value of this investment is substantially comprised of unrealized appreciation of $70.6 million.

Current wording

As of September 30, 2024, our common equity investment in Pfanstiehl Holdings, Inc., a global manufacturer of high-purity pharmaceutical ingredients, accounted for 18.7% and 48.7% of our total portfolio at fair value and our total net assets, respectively. The value of this investment is substantially comprised of unrealized appreciation of $73.4 million.

Previous wording

For the three months ended June 30, 2024, the weighted average performing income yield on interest-bearing investments increased primarily due to non-recurring Net Loan Fee acceleration related to the repayment of portfolio investments.

Current wording

For the three months ended September 30, 2024, the weighted-average performing income yield on interest-bearing investments increased to 13.6% from 13.4% during the prior quarter, primarily due to the sale of certain Structured Finance Securities and the redeployment of proceeds into higher yielding CLO subordinated note securities, partially offset by the timing of the redeployment of proceeds from repayments related to certain debt investments.

Previous wording

Weighted-average yields of our investments are not the same as a return on investment for our stockholders, but rather the gross investment income from our investment portfolio before the payment of all of our fees and expenses. There can be no assurance that the weighted average yields will remain at their current levels.

Current wording

Weighted-average yields of our investments are not the same as a return on investment for our stockholders, but rather the gross investment income from our investment portfolio before the payment of all of our fees and expenses. There can be no assurance that the weighted average yields will remain at their current levels. As of September 30, 2024, 91% of our total loan portfolio, at fair value, consisted of variable rate investments, generally indexed to SOFR. See additional information under “Item 3. Quantitative and Qualitative Disclosures About Market Risk”.

Previous wording

(1) As of June 30, 2024 and December 31, 2023, first lien debt investments include unitranche investments (which are loans that combine both senior and subordinated debt, in a first lien position) with an amortized cost and fair value of $143.3 million and $132.5 million, respectively, and $141.3 million and $131.3 million, respectively.

Current wording

(1) As of September 30, 2024 and December 31, 2023, first lien debt investments include unitranche investments (which are loans that combine both senior and subordinated debt, in a first lien position) with an amortized cost and fair value of $119.7 million and $109.4 million, respectively, and $141.3 million and $131.3 million, respectively.

Previous wording

As of June 30, 2024, approximately 100% of our loan portfolio and 59% of our total portfolio consisted of first lien and second lien loans, based on fair value. We believe the seniority of our debt investments in the borrowers’ capital structures may provide greater downside protection against adverse economic changes, including those caused by the elevated interest and inflation rates, the ongoing war between Russia and Ukraine, the escalated armed conflict in the Middle East, instability in the U.S. and international banking systems, uncertainties related to the 2024 U.S. presidential election, the risk of recession or a shutdown of U.S. government services and related market volatility.

Current wording

As of September 30, 2024, 100% of our loan portfolio and 59% of our total portfolio consisted of first lien and second lien loans, based on fair value.

Previous wording

As of June 30, 2024, the three largest industries of our Portfolio Company Investments by fair value, were: (1) Manufacturing (29.8%); (2) Health Care and Social Assistance (20.6%); and (3) Wholesale Trade (12.9%), totaling an aggregate of approximately 63.3% of our Portfolio Company Investment portfolio. For a full summary of our investment portfolio by industry, see “Item 1—Financial Statements—Note 4.”

Current wording

As of September 30, 2024, the three largest industries of our Portfolio Company Investments by fair value, were: (1) Manufacturing (33.4%); (2) Health Care and Social Assistance (20.5%); and (3) Professional, Scientific, and Technical Services (8.8%), totaling an aggregate of approximately 62.7% of our Portfolio Company Investment portfolio. For a full summary of our investment portfolio by industry, see “Item 1—Financial Statements—Note 4.”

Previous wording

As of June 30, 2024, the amortized cost and fair value ofnon-performing Structured Finance Securities was$3.5 million and $1.7 million, respectively. Non-performing Structured Finance Securities are securities that have not been optionally redeemed and have an effective yield of 0.0%, as remaining residual distributions are anticipated to be recognized as a return of capital.

Current wording

As of September 30, 2024, the amortized cost and fair value ofnon-performing Structured Finance Securities were$5.7 million and $1.9 million, respectively. Non-performing Structured Finance Securities are securities that have not been optionally redeemed and have an effective yield of 0.0%, as remaining residual distributions are anticipated to be recognized as a return of capital.

Previous wording

During the three and six months ended June 30, 2024, we sold subordinated note securities for net proceeds of $1.4 million and recognized a net realized loss of $1.9 million.

Current wording

During the nine months ended September 30, 2024, we sold Structured Finance Securities for aggregate net proceeds of $19.2 million and recognized a net realized loss of $3.5 million.

Previous wording

The following is a summary of our investment activity for the three and six months ended June 30, 2024 (dollar amounts in thousands):

Current wording

The following is a summary of our investment activity for the three and nine months ended September 30, 2024 (dollar amounts in thousands):

Previous wording

During the six months ended June 30, 2024, our first lien debt investment in GoTo Group underwent a restructuring whereby our first lien debt investment was exchanged at a price equal to 77% of par for new first lien debt investments in the company. We recognized a realized loss of $0.7 million on the debt restructure corresponding to the amount forgiven upon the exchange.

Current wording

During the nine months ended September 30, 2024, our first lien debt investment in GoTo Group underwent a restructuring whereby our first lien debt investment was exchanged at a price equal to 77% of par for new first lien debt investments in the company. We recognized a realized loss of $0.7 million on the debt restructure corresponding to the amount forgiven upon the exchange.

Previous wording

During the six months ended June 30, 2024, we restructured our first lien debt investments in Avison Young to, among other things, exchange our first lien debt investments for new first lien debt investments, preferred equity and common equity. The cost of the existing first lien debt investments was ascribed to the new investments received in the exchange, and no realized loss was recognized. We also invested an incremental $0.8 million in new-issue first lien debt.

Current wording

During the nine months ended September 30, 2024, we restructured our first lien debt investments in Avison Young to, among other things, exchange our first lien debt investments for new first lien debt investments, preferred equity and common equity. The cost of the existing first lien debt investments was ascribed to the new investments received in the exchange, and no realized loss was recognized. We also invested an incremental $0.8 million in new-issue first lien debt.

Previous wording

Management reviews, for placement on non-accrual status, all loans and CLO mezzanine debt investments that become past due on principal and interest, and/or when there is reasonable doubt that principal or interest will be collected. When a loan is placed on non-accrual status, accrued and unpaid cash interest is reversed. Additionally, Net Loan Fees are no longer recognized as of the date the loan is placed on non-accrual status. Depending upon management’s judgment, interest payments subsequently received on non-accrual investments may be recognized as income or applied to amortized cost. Interest accruals and Net Loan Fee amortization are resumed on non-accrual investments only when they are brought current with respect to principal and interest payments and, in the judgment of management, it is probable that the Company will collect all principal and interest from the investment. For the three months ended March 31, 2024, loans to one portfolio company with an aggregate amortized cost and fair value of $13.5 million and $9.7 million, respectively, were placed on non-accrual status. For the three months ended June 30, 2024, we wrote-off our second lien debt investment in Astro One Acquisition Corporation which was on non-accrual status following a cash-out recovery payment of $0.2 million, resulting in a net realized loss of $2.4 million.

Current wording

Management reviews, for placement on non-accrual status, all loans and CLO mezzanine debt investments that become past due on principal and interest, and/or when there is reasonable doubt that principal or interest will be collected. When a loan is placed on non-accrual status, accrued and unpaid cash interest is reversed. Additionally, Net Loan Fees are no longer recognized as of the date the loan is placed on non-accrual status. Depending upon management’s judgment, interest payments subsequently received on non-accrual investments may be recognized as interest income or applied as a reduction to amortized cost. Interest accruals and Net Loan Fee amortization are resumed on non-accrual investments only when they are brought current with respect to principal and interest payments and, in the judgment of management, it is probable that the Company will collect all principal and interest from the investment.

Previous wording

Comparison of the three months ended June 30, 2024 and March 31, 2024 and comparison of the six months ended June 30, 2024 and 2023

Current wording

Comparison of the three months ended September 30, 2024 and June 30, 2024 and comparison of the nine months ended September 30, 2024 and 2023

Previous wording

Consolidated operating results for the three months ended June 30, 2024 and March 31, 2024, and the six months ended June 30, 2024 and 2023 are as follows (in thousands):

Current wording

Consolidated operating results for the three months ended September 30, 2024 and June 30, 2024, and the nine months ended September 30, 2024 and 2023 are as follows (in thousands):

Previous wording

For the three months ended June 30, 2024, total investment income decreased to $11.2 million from $14.2 million in the prior quarter, primarily due to decreases in total dividend income of $2.4 million and interest income of $0.5 million, respectively.

Current wording

For the three months ended September 30, 2024, total investment income decreased to $10.9 million from $11.2 million in the prior quarter, primarily due to a decrease in interest income of $0.2 million.

Previous wording

Fee income is primarily comprised of unused fees, prepayment fees and syndication fees that generally result from periodic transactions rather than from holding portfolio investments, and are considered non-recurring. We receive syndication fees on investments where OFS Advisor sources, structures, and arranges the lending group. For the three months ended June 30, 2024, total fee income decreased from $0.1 million to $31,000 compared to $129,000 for the prior quarter, primarily due to no syndication fees recognized during the current quarter.

Current wording

Fee income is primarily comprised of unused fees, prepayment fees and syndication fees that generally result from periodic transactions rather than from holding portfolio investments, and are considered non-recurring. We receive syndication fees on investments where OFS Advisor sources, structures, and arranges the lending group.

Previous wording

Total investment income for the six months ended June 30, 2024 decreased $3.4 million compared to the corresponding period in the prior year, primarily due to a decrease in total interest income of $5.2 million, partially offset by an increase in total dividend income of $1.9 million.

Current wording

Total investment income for the nine months ended September 30, 2024 decreased $7.1 million compared to the corresponding period in the prior year, primarily due to a decrease in total interest income of $8.9 million, partially offset by an increase in total dividend income of $1.8 million.

Previous wording

Operating expenses for the three months ended June 30, 2024 and March 31, 2024, and the six months ended June 30, 2024 and 2023 are presented below (in thousands):

Current wording

Operating expenses for the three months ended September 30, 2024 and June 30, 2024, and the nine months ended September 30, 2024 and 2023 are presented below (in thousands):

Previous wording

Interest expense for the three months ended June 30, 2024 decreased $0.5 million compared to the prior quarter, primarily due to a decrease of $35.7 million in our average outstanding debt balances compared to the prior quarter. During the three months ended June 30, 2024, we repaid $9.4 million of the outstanding amount under the BNP Facility.

Current wording

Interest expense for the three months ended September 30, 2024 decreased $0.1 million compared to the prior quarter, primarily due to a decrease of $6.1 million in our average outstanding debt balances compared to the prior quarter.

Previous wording

Interest expense for the six months ended June 30, 2024 decreased $1.2 million compared to the corresponding period in the prior year, primarily due to the full repayment of our SBA debentures in March 2024 and a reduction in the outstanding amount under the BNP Facility.

Current wording

Interest expense for the nine months ended September 30, 2024 decreased $2.1 million compared to the corresponding period in the prior year, primarily due to the full repayment of our SBA debentures in March 2024 and a reduction in the outstanding amount under the BNP Facility.

Previous wording

Base management fees for the six months ended June 30, 2024 decreased $0.8 million compared to the corresponding period in the prior year, primarily due to the decrease in the average size of the quarterly investment portfolio, at fair value, from $498.3 million to $406.3 million.

Current wording

Base management fees for the nine months ended September 30, 2024 decreased $1.1 million compared to the corresponding period in the prior year, primarily due to the decrease in our average total assets (excluding cash and cash equivalents) during the period.

Previous wording

Net gain (loss) on investments, inclusive of realized and unrealized gains (losses), by investment type for the three months ended June 30, 2024 and March 31, 2024, and the six months ended June 30, 2024 and 2023 were as follows (in thousands):

Current wording

Net gain (loss) on investments, inclusive of realized and unrealized gains (losses), by investment type for the three months ended September 30, 2024 and June 30, 2024, and the nine months ended September 30, 2024 and 2023 were as follows (in thousands):

Previous wording

For the three months ended June 30, 2024, we recognized a net gain on investments of $6.9 million, primarily due to net unrealized appreciation of $11.3 million, partially offset by net realized losses of $4.3 million. For the quarter ended June 30, 2024, our net unrealized appreciation of $11.3 million primarily related to net unrealized appreciation of $7.8 million on our common equity in Pfanstiehl Holdings, Inc., and net unrealized appreciation of $2.1 million on our subordinated note investment in Apex Credit CLO 2020 Ltd.

Current wording

For the three months ended June 30, 2024, we recognized a net gain on investments of $6.9 million, primarily due to net unrealized appreciation of $11.2 million, net of taxes, partially offset by net realized losses of $4.3 million. For the three months ended June 30, 2024, our net unrealized appreciation of $11.2 million, net of taxes, was primarily related to net unrealized appreciation of $7.8 million on our common equity in Pfanstiehl Holdings, Inc., and net unrealized appreciation of $2.1 million on our subordinated note investment in Apex Credit CLO 2020 Ltd.

Previous wording

Net loss on investments for the six months ended June 30, 2024 and 2023

Current wording

Net gain (loss) on investments for the nine months ended September 30, 2024 and 2023

Previous wording

During the six months ended June 30, 2023, our portfolio experienced net losses of $8.2 million, primarily related to unrealized depreciation of $6.7 million on our Structured Finance Securities.

Current wording

During the nine months ended September 30, 2023, our portfolio experienced net losses of $11.6 million, primarily due to net unrealized depreciation of $6.7 million on our common equity, warrants and other investments and $3.4 million on our Structured Finance Securities, respectively.

Previous wording

As of June 30, 2024, we held cash and cash equivalents of $5.6 million, which includes $2.7 million held by OFSCC-FS. Distributions from OFSCC-FS to the Parent are restricted by the terms and conditions of the BNP Facility. During the six months ended June 30, 2024, the Parent received $5.5 million in cash distributions from OFSCC-FS.

Current wording

As of September 30, 2024, we held cash and cash equivalents of $20.3 million, which included $8.0 million held by OFSCC-FS. Distributions from OFSCC-FS to the Parent are restricted by the terms and conditions of the BNP Facility. During the nine months ended September 30, 2024, the Parent received $8.8 million in cash distributions from OFSCC-FS.

Previous wording

As of June 30, 2024, we had an unused commitment of $25.0 million under our Banc of California Credit Facility, as well as an unused commitment of $80.9 million under our BNP Facility, both of which are subject to a borrowing base requirements and other covenants. As of June 30, 2024, we had unfunded commitments of $8.9 million to eight portfolio companies.

Current wording

As of September 30, 2024, we had an unused commitment of $25.0 million under our Banc of California Credit Facility, as well as an unused commitment of $80.9 million under our BNP Facility, both of which are subject to a borrowing base requirements and other covenants. As of September 30, 2024, we had a payable for investments purchased of $14.7 million and unfunded commitments of $8.5 million to eight portfolio companies.

Previous wording

As of June 30, 2024, the aggregate amount outstanding of the senior securities issued by us was $249.1 million, for which our asset coverage was 162%, exceeding our minimum asset coverage requirement of 150% under the 1940 Act. The asset coverage ratio for a class of senior securities representing indebtedness is calculated as our consolidated total assets, less all liabilities and indebtedness not represented by senior securities, divided by total senior securities representing indebtedness.

Current wording

As of September 30, 2024, the aggregate amount outstanding of the senior securities issued by us was $249.1 million, for which our asset coverage was 161%, exceeding our minimum asset coverage requirement of 150% under the 1940 Act. The asset coverage ratio for a class of senior securities representing indebtedness is calculated as our consolidated total assets, less all liabilities and indebtedness not represented by senior securities, divided by total senior securities representing indebtedness.

Previous wording

For the six months ended June 30, 2024, cash from net investment income of $6.2 million decreased $2.9 million compared to the six months ended June 30, 2023, primarily due to a decrease of $4.1 million in cash interest income.

Current wording

For the nine months ended September 30, 2024, cash from net investment income of $8.8 million decreased $3.8 million compared to the nine months ended September 30, 2023, primarily due to a decrease of $5.7 million in cash interest and dividend income.

Previous wording

During the six months ended June 30, 2024, net sales and repayments of portfolio investments of $16.5 million were primarily due to $28.8 million of cash we received from principal repayments, sales on our portfolio investments and the net proceeds from distributions received from Structured Finance Securities and accretion of interest income on Structured Finance Securities, partially offset by $12.3 million of cash we used to purchase portfolio investments. During the six months ended June 30, 2023, net purchases and originations of portfolio investments of $0.3 million were primarily due to $26.3 million of cash we used to purchase portfolio investments, partially offset by $26.0 million of cash we received from amortized cost repayments, sales on our portfolio investments and the net proceeds from distributions received from Structured Finance Securities and accretion of interest income on Structured Finance Securities. See “—Portfolio Composition and Investment Activity—Investment Activity.”

Current wording

During the nine months ended September 30, 2024, net sales and repayments of portfolio investments of $33.1 million were primarily due to $79.2 million of cash we received from principal repayments, sales on our portfolio investments and the proceeds from distributions received from Structured Finance Securities, net of accretion of interest income on Structured Finance Securities, partially offset by $46.1 million of cash we used to purchase portfolio investments. During the nine months ended September 30, 2023, net sales and repayments of portfolio investments of $34.4 million were primarily due to $69.1 million of cash we received from amortized cost repayments, sales on our portfolio investments, net proceeds from distributions received from Structured Finance Securities and accretion of interest income on Structured Finance Securities, partially offset by $34.7 million of cash we used to purchase portfolio investments. See “—Portfolio Composition and Investment Activity—Investment Activity.”

Previous wording

As of June 30, 2024, we had $-0- outstanding and an unused commitment of $25.0 million under the Banc of California Credit Facility, subject to a borrowing base and other covenants. The Banc of California Credit Facility bears interest at a variable Prime Rate plus a 0.25% margin, with a 5.00% floor, and as of June 30, 2024, the effective interest rate on the Banc of California Credit Facility was 9.25%.

Current wording

As of September 30, 2024, we had $-0- outstanding and an unused commitment of $25.0 million under the Banc of California Credit Facility, subject to a borrowing base and other covenants. The Banc of California Credit Facility bears interest at a variable Prime Rate plus a 0.25% margin, with a 5.00% floor, and as of September 30, 2024, the effective interest rate on the Banc of California Credit Facility was 8.75%.