Net Increase from Amounts Committed by Affiliates
For the three and six months ended June 30, 2021 and June 30, 2020, the Adviser did not voluntarily reimburse the Company for
unrealized losses sustained. Cumulatively since inception, the Adviser has committed $2,275,000 to voluntarily reimburse the Company for such losses. Had these commitments not been made since inception, the net asset value (NAV) as of
June 30, 2021 would have been lower by approximately this amount.
Amounts committed and paid by the Adviser to reimburse for
unrealized losses are nonrecurring, and investors should not expect the Adviser to make similar commitments or payments in the future.
from Adviser / Payable to Adviser
As of June 30, 2021 and December 31, 2020, $68,919 and $101,542 were owed from the
Adviser to the Company, respectively, largely related to the expense limitation agreement.
As of June 30, 2021 and December 31,
2020, the Company owed $364,196 and $423,537, respectively, to the Adviser, largely related to advisory fees, and administration fees.
Companys organizational documents, the officers and Directors have been granted certain indemnification rights against certain liabilities that may arise out of performance of their duties to the Company. Additionally, in the normal course of
business, the Company may enter into contracts with service providers that contain a variety of indemnification clauses. The Companys maximum exposure under these arrangements is dependent on future claims that may be made against the Company
and, therefore, cannot be estimated.
Note 5 U.S. Federal Income Tax Information
The Company has elected to be treated for federal income tax purposes, and intends to qualify annually, as a RIC under Subchapter M of the
Code. To maintain its qualification as a RIC, the Company must, among other things, meet certain source-of-income and asset diversification requirements and distribute
to its stockholders, for each taxable year, at least 90% of its investment company taxable income, which is generally the Companys net ordinary income plus the excess, if any, of realized net short-term capital gains over realized
net long-term capital losses. As a RIC, the Company will not be subject to corporate-level federal income taxes on any income that it timely distributes to its stockholders. The Company intends to make distributions in an amount sufficient to
maintain its RIC status each year and to avoid any federal income taxes on income so distributed. The Company will also be subject to nondeductible federal excise taxes if it does not distribute at least 98% of net ordinary income, 98.2% of any
capital gain net income, if any, and any recognized and undistributed income from prior years on which it paid no federal income taxes.
The character of income and capital gains to be distributed is determined in accordance with the Code, U.S. Treasury regulations, and other
applicable authority, which may differ from GAAP. These differences include (but are not limited to) investments organized as partnerships for tax purposes, total return swaps, loan investments, and losses deferred due to wash sale transactions.
Reclassifications are made to the Companys capital accounts to reflect income and gains available for distribution (or available capital loss carryovers) under the Code, U.S. Treasury regulations, and other applicable authority. These
reclassifications have no impact on net investment income, realized gains or losses, or net asset value of the Company. The calculation of net investment income per share in the Financial Highlights table excludes these adjustments.
Uncertainty in Income Taxes
Company will evaluate its tax positions to determine if the tax positions taken meet the minimum recognition threshold in connection with accounting for uncertainties in income tax positions taken or expected to be taken for the purposes of
measuring and recognizing tax benefits or liabilities in the financial statements. Recognition of a tax benefit or liability with respect to an uncertain tax position is required only when the position is more likely than not to be
sustained assuming examination by taxing authorities. The Companys tax returns are subject to examination by the Internal Revenue Service for a period of three fiscal years after they are filed. The Company recognizes interest and penalties,
if any, related to unrecognized tax liabilities as income tax expense in the Statements of Operations. During the six months ended June 30, 2021 and June 30, 2020, the Company did not incur any interest or penalties. Furthermore,
management of the Company is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next 12 months.