Cash and Cash Equivalents
The Company considers liquid assets deposited with a bank and certain short-term debt instruments with original maturities of three months or
less to be cash equivalents. These investments represent amounts held with financial institutions that are readily accessible to pay Company expenses or purchase investments. Cash and cash equivalents are valued at cost plus accrued interest, which
approximates market value. The value of cash equivalents denominated in foreign currencies, if any, is determined by converting to U.S. dollars on the date of the Statements of Assets and Liabilities. As of September 30, 2020 and
December 31, 2019, the Company had cash and cash equivalents of $4,268,422 and $7,764,892, respectively. As of September 30, 2020 and December 31, 2019, $4,004,290 and $7,745,979 was held in the State Street U.S. Government Money
Market Fund, and $264,132 and $18,913 was held in a custodial account with State Street Bank and Trust Company, respectively.
Securities Sold Short
and Restricted Cash
The Company may sell securities short. A security sold short is a transaction in which the Company sells a
security it does not own in anticipation that the market price of that security will decline. When the Company sells a security short, it must borrow the security sold short from a broker-dealer and deliver it to the buyer upon conclusion of the
transaction. The Company may have to pay a fee to borrow particular securities and is often obligated to pay over any dividends or other payments received on such borrowed securities. Cash held as collateral for securities sold short is classified
as restricted cash on the Statements of Assets and Liabilities. Securities held as collateral for securities sold short are shown on the Schedule of Investments for the Company, as applicable. As of September 30, 2020 and December 31,
2019, the Company did not have any securities sold short.
When securities are sold short, the Company intends to limit exposure to a
possible market decline in the value of its portfolio companies through short sales of securities that the Adviser believes possess volatility characteristics similar to those being hedged. In addition, the Company may use short sales for non-hedging purposes to pursue its investment objective. Subject to the requirements of the 1940 Act and the Code, the Company will not make a short sale if, after giving effect to such sale, the market value of all
securities sold short by the Company exceeds 25% of the value of its total assets.
Other Fee Income
Fee income may consist of origination/closing fees, amendment fees, administrative agent fees, transaction
break-up fees and other miscellaneous fees. Origination fees, amendment fees, and other similar fees are non-recurring fee sources. Such fees are received on a
transaction by transaction basis and do not constitute a regular stream of income. For the three and nine months ended September 30, 2020, the Company recognized $1 and $108,555 of fee income, respectively. For the three and nine months
ended September 30, 2019, the Company recognized $0 and $49,895 of fee income, respectively.
Fair Value of Financial Instruments
It is the Companys policy to hold the investments at fair value. Accounting Standards Codification Topic 820, Fair Value Measurements
and Disclosure (ASC Topic 820) defines fair value as the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic
820 also establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, which includes
inputs such as quoted prices for similar securities in active markets and quoted prices for identical securities where there is little or no activity in the market; and Level 3, defined as unobservable inputs for which little or no market data
exists, therefore requiring an entity to develop its own assumptions.
The Company determines the net asset value of its investment
portfolio each quarter, or more frequently as needed. Securities that are publicly-traded are valued at the reported closing price on the valuation date. Securities that are not publicly-traded are valued at fair value as determined in good faith by
the board of directors of the Company (the Board) or by the Adviser, pursuant to board-approved policies and procedures. In connection with that determination, the Adviser will provide the Board with portfolio company valuations which
are based on relevant inputs, including indicative dealer quotes, values of like securities, recent portfolio company financial statements and forecasts, and valuations prepared by third-party valuation services.
With respect to investments for which market quotations are not readily available, the Board and the Adviser undertake a multi-step valuation
process each quarter, as described below:
The valuation process begins with each portfolio company or investment being initially valued by investment
professionals of the Adviser responsible for credit monitoring or independent third party valuation firms.