What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-11-07 compared with 2024-08-05 · 269 added, 147 removed, 1394 unchanged (23% of the section changed)

3 unchanged sentences

(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

September 30,

2024 March 31,

23 unchanged sentences

Fee due to Administrator (A)

Distributions payable 25,682 —

Other liabilities

24 unchanged sentences

(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Three Months Ended June 30,

Three Months Ended September 30, Six Months Ended September 30,

2024 2023 2024 2023

INVESTMENT INCOME

3 unchanged sentences

Affiliate investments

5,834 6,318 11,874 11,934

Cash and cash equivalents

57 333 100 620

Total interest income

1 unchanged sentence

Dividend income

Non-Control/Non-Affiliate investments

1,419 — 1,419 —

Affiliate investments

Total dividend income

1,419 — 1,419 1,907

Success fee income

Non-Control/Non-Affiliate investments

Affiliate investments

Total success fee income

150 — 1,703 —

Total investment income

3 unchanged sentences

Loan servicing fee (A)

2,194 2,325 4,416 4,497

Incentive fee (A)

1 unchanged sentence

Administration fee (A)

567 334 1,073 856

Interest expense on borrowings

6,399 6,104 12,879 11,078

Amortization of deferred financing costs and discounts

629 574 1,260 1,119

Professional fees

481 335 811 619

Other general and administrative expenses

1,188 828 2,802 1,513

Expenses before credits from Adviser

5 unchanged sentences

Total expenses, net of credits to fees

NET INVESTMENT INCOME

15,274 22,007 25,038 33,867

NET INVESTMENT INCOME (LOSS)

$ 7,291 $ ( 1,730 ) $ 19,705 $ 6,710

REALIZED AND UNREALIZED GAIN (LOSS)

1 unchanged sentence

Non-Control/Non-Affiliate investments

$ 19 $ 289 $ 21 $ 289

Affiliate investments

42,284 — 42,284 273

Control investments

Total net realized gain

42,303 289 42,305 1,444

Net unrealized (depreciation) appreciation:

7 unchanged sentences

( 34,112 ) 48,797 ( 53,054 ) 47,988

Net realized and unrealized (loss) gain ( 18,940 ) 346

NET (DECREASE) INCREASE IN NET ASSETS RESULTING FROM OPERATIONS

Net realized and unrealized gain (loss) 8,191 49,086 ( 10,749 ) 49,432

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS

$ 15,482 $ 47,356 $ 8,956 $ 56,142

BASIC AND DILUTED PER COMMON SHARE:

Net investment income

Net investment income (loss)

$ 0.20 $ ( 0.05 ) $ 0.54 $ 0.20

Net (decrease) increase in net assets resulting from operations $ ( 0.18 ) $ 0.26

Net increase in net assets resulting from operations $ 0.42 $ 1.40 $ 0.24 $ 1.67

WEIGHTED-AVERAGE SHARES OF COMMON STOCK OUTSTANDING:

27 unchanged sentences

$ 477,380 $ 436,435

Net investment income (loss) $ 7,291 $ ( 1,730 )

Net realized gain on investments 42,303 289

Net unrealized (depreciation) appreciation of investments ( 34,112 ) 48,745

Net unrealized depreciation of other — 52

Net increase in net assets from operations

15,482 47,356

DISTRIBUTIONS (A)

Distributions to common stockholders from net investment income ( $ 0.24 and $ 0.20 per share, respectively)

( 8,805 ) ( 6,665 )

Distributions to common stockholders from net realized gains ( $ 0.70 and $ 0.16 per share, respectively) (B)

( 25,682 ) ( 5,519 )

Net decrease in net assets from distributions

( 34,487 ) ( 12,184 )

CAPITAL ACTIVITY

Issuance of common stock

Discounts, commissions, and offering costs for issuance of common stock

Net increase in net assets from capital activity

NET (DECREASE) INCREASE IN NET ASSETS

( 19,005 ) 39,231

NET ASSETS, SEPTEMBER 30

$ 458,375 $ 475,666

(A) Refer to Note 8 — Distributions to Common Stockholders in the accompanying Notes to Consolidated Financial Statements for additional information.

(B) Includes $ 0.70 per common share of distributions declared and unpaid as of September 30, 2024, as such distribution was a supplemental distribution declared on September 17, 2024 with a record date of October 4, 2024 and a pay date of October 15, 2024.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL STATEMENTS.

2 unchanged sentences

(IN THOUSANDS)

Three Months Ended June 30,

Six Months Ended September 30,

CASH FLOWS FROM OPERATING ACTIVITIES

Net (decrease) increase in net assets resulting from operations

Net increase in net assets resulting from operations

$ 8,956 $ 56,142

6 unchanged sentences

( 42,305 ) ( 1,444 )

Net unrealized depreciation of investments

Net unrealized depreciation (appreciation) of investments

53,054 ( 47,925 )

Net unrealized appreciation of other

1 unchanged sentence

Bad debt expense, net of recoveries

1,045 ( 111 )

Changes in assets and liabilities:

6 unchanged sentences

(Decrease) increase in interest payable

Decrease in fees due to Adviser (A)

( 224 ) 1,182

Increase in fee due to Administrator (A)

(Decrease) increase in fees due to Adviser (A)

( 3,991 ) 8,264

Decrease in fee due to Administrator (A)

( 161 ) ( 327 )

(Decrease) increase in other liabilities

1 unchanged sentence

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from issuance of common stock

Discounts, commissions, and offering costs for issuance of common stock — ( 46 )

Proceeds from line of credit

16 unchanged sentences

$ 12,442 $ 9,232

NON-CASH FINANCING ACTIVITY:

Distributions payable $ 25,682 $ —

(A) Refer to Note 4 — Related Party Transactions in the accompanying Notes to Consolidated Financial Statements for additional information.

2 unchanged sentences

CONSOLIDATED SCHEDULE OF INVESTMENTS

JUNE 30, 2024

SEPTEMBER 30, 2024

(DOLLAR AMOUNTS IN THOUSANDS)

51 unchanged sentences

The E3 Company, LLC – Line of Credit, $ 1,000 available (SOFR+ 5.5 %, 10.3 % Cash, Due 2/2025) (J)

1,000 1,000 1,000

The E3 Company, LLC – Term Debt (SOFR+ 9.0 %, 13.8 % Cash, Due 9/2028) (J)

20 unchanged sentences

Cargo Transport – 2.7 %

Diligent Delivery Systems – Term Debt (SOFR+ 9.0 %, 14.3 % Cash, Due 9/2024) (G)(J)

Diligent Delivery Systems – Term Debt (SOFR+ 9.0 %, 13.8 % Cash, Due 10/2024) (G)(I)

13,000 13,000 12,408

2 unchanged sentences

CONSOLIDATED SCHEDULE OF INVESTMENTS (Continued)

JUNE 30, 2024

SEPTEMBER 30, 2024

(DOLLAR AMOUNTS IN THOUSANDS)

10 unchanged sentences

Dema/Mai Holdings, Inc.

- Preferred Equity (C)(J)

- Preferred Stock (C)(J)

21,000 $ 21,000 $ 23,499

57 unchanged sentences

CONSOLIDATED SCHEDULE OF INVESTMENTS (Continued)

JUNE 30, 2024

SEPTEMBER 30, 2024

(DOLLAR AMOUNTS IN THOUSANDS)

29 unchanged sentences

B+T Group Acquisition, Inc.

(K) – Line of Credit, $ 0 available (SOFR+ 2.0 %, 7.3 % Cash, Due 12/2026) (J)

(K) – Line of Credit, $ 0 available (SOFR+ 2.0 %, 7.0 % Cash, Due 12/2026) (G)(J)

3,080 3,080 3,080

B+T Group Acquisition, Inc.

(K) – Line of Credit, $ 297 available (SOFR+ 2.0 %, 7.3 % Cash, Due 6/2025) (J)

(K) – Line of Credit, $ 297 available (SOFR+ 2.0 %, 7.0 % Cash, Due 6/2025) (G)(J)

B+T Group Acquisition, Inc.

7 unchanged sentences

$ 26,618 $ 26,618 $ 18,596

Diversified/Conglomerate Services – 5.2 %

Nth Degree, Inc.

– Term Debt (SOFR+ 8.5 %, 13.8 % Cash, Due 6/2029) (I)

25,000 25,000 25,000

Total Secured Second Lien Debt

29 unchanged sentences

CONSOLIDATED SCHEDULE OF INVESTMENTS (Continued)

JUNE 30, 2024

SEPTEMBER 30, 2024

(DOLLAR AMOUNTS IN THOUSANDS)

3 unchanged sentences

Common Equity/Equivalents – 0.0 %

Diversified/Conglomerate Services – 9.3 %

Nth Degree Investment Group, LLC – Common Stock (C)(J)

17,216,976 $ 6,219 $ 44,247

Telecommunications – 0.0 %

22 unchanged sentences

Additionally, under Section 55 of the Investment Company Act of 1940, as amended (the "1940 Act"), we may not acquire any non-qualifying assets unless, at the time such acquisition is made, qualifying assets represent at least 70 % of our total assets.

(B) Unless indicated otherwise, all cash interest rates are indexed to 30 day Secured Overnight Financing Rate ("SOFR"), which was 5.3 % as of June 30, 2024.

(B) Unless indicated otherwise, all cash interest rates are indexed to 30 day Secured Overnight Financing Rate ("SOFR"), which was 4.8 % as of September 30, 2024.

If applicable, paid-in-kind interest rates are noted separately from the cash interest rate.

3 unchanged sentences

(D) Category percentages represent the fair value of each category and subcategory as a percentage of net assets as of June 30, 2024.

(D) Category percentages represent the fair value of each category and subcategory as a percentage of net assets as of September 30, 2024.

(E) Unless indicated otherwise, all of our investments are valued using Level 3 inputs within the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 820, "Fair Value Measurements and Disclosures" ("ASC 820") fair value hierarchy.

12 unchanged sentences

(M) Affiliate investments, as defined by the 1940 Act, are those that are not Control investments and in which we own, with the power to vote, between and inclusive of 5.0% and 25.0% of the issued and outstanding voting securities.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL STATEMENTS.

GLADSTONE INVESTMENT CORPORATION

CONSOLIDATED SCHEDULE OF INVESTMENTS (Continued)

JUNE 30, 2024

(DOLLAR AMOUNTS IN THOUSANDS)

(N) Control investments, as defined by the 1940 Act, are those where we have the power to exercise a controlling influence over the management or policies of the portfolio company, which may include owning, with the power to vote, more than 25.0% of the issued and outstanding voting securities.

98 unchanged sentences

Dema/Mai Holdings, Inc.

– Preferred Equity (C)(J)

– Preferred Stock (C)(J)

21,000 $ 21,000 $ 22,181

104 unchanged sentences

Diversified/Conglomerate Services – 5.1 %

Nth Degree, Inc.

– Term Debt (SOFR+ 8.5 %, 13.8 % Cash, Due 6/2029) (I)

Nth Degree Investment Group, LLC – Term Debt (SOFR+ 8.5 %, 13.8 % Cash, Due 6/2029) (I)

25,000 25,000 25,000

105 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024

SEPTEMBER 30, 2024

(DOLLAR AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA AND AS OTHERWISE INDICATED)

11 unchanged sentences

We intend that our investment portfolio over time will consist of approximately 75.0 % in debt investments and 25.0 % in equity investments, at cost.

As of June 30, 2024, our investment portfolio was comprised of 77.0 % in debt investments and 23.0 % in equity investments, at cost.

As of September 30, 2024, our investment portfolio was comprised of 77.4 % in debt investments and 22.6 % in equity investments, at cost.

Gladstone Business Investment, LLC (“Business Investment”), a wholly-owned subsidiary of ours, was established on August 11, 2006 for the sole purpose of holding certain investments pledged as collateral under our line of credit.

14 unchanged sentences

In our opinion, all adjustments, consisting solely of normal recurring accruals, necessary for the fair statement of financial statements for the interim periods have been included.

The results of operations for the three months ended June 30, 2024 are not necessarily indicative of results that ultimately may be achieved for the fiscal year ending March 31, 2025 or any future interim period.

The interim financial statements and notes thereto should be read in conjunction with the financial statements and notes

thereto included in our annual report on Form 10-K for the fiscal year ended March 31, 2024, as filed with the SEC on May 8, 2024.

The results of operations for the three and six months ended September 30, 2024 are not necessarily indicative of results that ultimately may be achieved for the fiscal year ending March 31, 2025 or any future interim period.

The interim financial statements and notes thereto should be read in conjunction with the financial

statements and notes thereto included in our annual report on Form 10-K for the fiscal year ended March 31, 2024, as filed with the SEC on May 8, 2024.

Use of Estimates

39 unchanged sentences

Generally, the Valuation Team uses TEV to value our equity investments and, in the circumstances where we have the ability to effectuate a sale of a portfolio company, our debt investments.

When there is equity value or sufficient TEV to cover the principal balance of our debt securities, the fair value of our senior secured debt generally equals or approximates cost.

TEV is primarily calculated using EBITDA and EBITDA multiples;

28 unchanged sentences

Generally, non-accrual loans are restored to accrual status when past-due principal and interest are paid and, in management’s judgment, are likely to remain current, or, due to a restructuring, the interest income is deemed to be collectible.

As of June 30, 2024, certain of our loans to B+T Group Acquisition, Inc., Diligent Delivery Systems, Edge Adhesives Holdings, Inc.

As of September 30, 2024, our loans to B+T Group Acquisition, Inc., Diligent Delivery Systems, Edge Adhesives Holdings, Inc.

("Edge"), and J.R.

5 unchanged sentences

Thus, the actual collection of PIK income may be deferred until the time of debt principal repayment.

As of June 30, 2024 and March 31, 2024, we did not have any loans with a PIK interest component.

As of September 30, 2024 and March 31, 2024, we did not have any loans with a PIK interest component.

Success Fee Income Recognition

20 unchanged sentences

The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement.

As of June 30, 2024, all of our investments were valued using Level 3 inputs within the ASC 820 fair value hierarchy.

As of September 30, 2024, all of our investments were valued using Level 3 inputs within the ASC 820 fair value hierarchy.

As of March 31, 2024, all of our investments were valued using Level 3 inputs within the ASC 820 fair value hierarchy, except for our investment in Funko, which was valued using Level 2 inputs.

We transfer investments in and out of Level 1, 2 and 3 of the valuation hierarchy as of the beginning balance sheet date, based on changes in the use of observable and unobservable inputs utilized to perform the valuation for the period.

There were no transfers in or out of Level 1, 2 and 3 during the three months ended June 30, 2024 and 2023, respectively.

As of June 30, 2024 and March 31, 2024, our investments, by security type, at fair value were categorized as follows within the ASC 820 fair value hierarchy:

There were no transfers in or out of Level 1, 2 and 3 during the three and six months ended September 30, 2024 and 2023, respectively.

As of September 30, 2024 and March 31, 2024, our investments, by security type, at fair value were categorized as follows within the ASC 820 fair value hierarchy:

Fair Value Measurements

3 unchanged sentences

Observable Inputs

As of June 30, 2024:

As of September 30, 2024:

Secured first lien debt

5 unchanged sentences

Common equity/equivalents

Total Investments as of June 30, 2024

Total Investments as of September 30, 2024

$ 853,307 $ — $ — $ 853,307

16 unchanged sentences

(our units in Funko could be converted into common shares of Funko, Inc.) at the reporting date less a discount for lack of marketability, as our investment was subject to certain restrictions.

The following table presents our investments, valued using Level 3 inputs within the ASC 820 fair value hierarchy, and carried at fair value as of June 30, 2024 and March 31, 2024, by caption on our accompanying Consolidated Statements of Assets and Liabilities, and by security type:

The following table presents our investments, valued using Level 3 inputs within the ASC 820 fair value hierarchy, and carried at fair value as of September 30, 2024 and March 31, 2024, by caption on our accompanying Consolidated Statements of Assets and Liabilities, and by security type:

Total Recurring Fair Value Measurements

2 unchanged sentences

Valued Using Level 3 Inputs

June 30, 2024 March 31, 2024

September 30, 2024 March 31, 2024

Non-Control/Non-Affiliate Investments

19 unchanged sentences

(A) Excludes our investment in Funko as of March 31, 2024 with a fair value of $ 18 thousand, which was valued using Level 2 inputs.

In accordance with ASC 820, the following table provides quantitative information about our investments valued using Level 3 fair value measurements as of June 30, 2024 and March 31, 2024.

In accordance with ASC 820, the following table provides quantitative information about our investments valued using Level 3 fair value measurements as of September 30, 2024 and March 31, 2024.

The table below is not intended to be all-inclusive, but rather provides information on the significant Level 3 inputs as they relate to our fair value measurements.

4 unchanged sentences

Input Range / Weighted-Average as of

September 30,

2024 March 31,

2024 June 30,

2024 September 30,

2024 March 31,

35 unchanged sentences

Changes in Level 3 Fair Value Measurements of Investments

The following tables provide our portfolio’s changes in fair value, broken out by security type, during the three months ended June 30, 2024 and 2023 for all investments for which the Adviser determines fair value using unobservable (Level 3) inputs.

The following tables provide our portfolio’s changes in fair value, broken out by security type, during the three and six months ended September 30, 2024 and 2023 for all investments for which the Adviser determines fair value using unobservable (Level 3) inputs.

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)

1 unchanged sentence

Equivalents Total

Three Months ended June 30, 2024:

Fair value as of March 31, 2024

Three Months ended September 30, 2024:

Fair value as of June 30, 2024

$ 463,219 $ 137,827 $ 212,591 $ 85,501 $ 899,138

1 unchanged sentence

Net realized gain (loss) (A)

— — — 42,284 42,284

Net unrealized appreciation (depreciation) (B)

1 unchanged sentence

Reversal of previously recorded (appreciation) depreciation upon realization (B)

— — — ( 38,028 ) ( 38,028 )

New investments, repayments and settlements (C):

3 unchanged sentences

— ( 25,000 ) — — ( 25,000 )

— — — ( 48,503 ) ( 48,503 )

Fair value as of September 30, 2024

$ 469,480 $ 111,344 $ 228,528 $ 43,955 $ 853,307

Debt Preferred

Equivalents Total

Six Months Ended September 30, 2024

Fair value as of March 31, 2024 $ 474,856 $ 138,703 $ 213,480 $ 93,447 $ 920,486

Total gain (loss):

Net realized gain (loss) (A)

— — — 42,284 42,284

Net unrealized appreciation (depreciation) (B)

( 22,474 ) ( 2,359 ) 15,048 ( 5,245 ) ( 15,030 )

Reversal of previously recorded (appreciation) depreciation upon realization (B)

— — — ( 38,028 ) ( 38,028 )

New investments, repayments and settlements (C):

Issuances / originations

20,098 — — — 20,098

Settlements / repayments

( 3,000 ) ( 25,000 ) — — ( 28,000 )

— — — ( 48,503 ) ( 48,503 )

Fair value as of September 30, 2024

$ 469,480 $ 111,344 $ 228,528 $ 43,955 $ 853,307

Three Months ended September 30, 2023:

Fair value as of June 30, 2023

$ 452,215 $ 104,794 $ 214,258 $ 28,780 $ 800,047

Three Months ended June 30, 2023:

Total gain (loss):

Net realized gain (loss) (A)

Net unrealized appreciation (depreciation) (B)

889 ( 2,047 ) 41,925 7,987 48,754

Reversal of previously recorded (appreciation) depreciation upon realization (B)

New investments, repayments and settlements (C) :

Issuances / originations

55,400 — 11,413 — 66,813

Settlements / repayments

Fair value as of September 30, 2023

$ 508,504 $ 102,747 $ 267,596 $ 36,767 $ 915,614

Six Months Ended September 30, 2023:

Fair value as of March 31, 2023

12 unchanged sentences

— — ( 273 ) ( 1,502 ) ( 1,775 )

Fair value as of June 30, 2023

Fair value as of September 30, 2023

$ 508,504 $ 102,747 $ 267,596 $ 36,767 $ 915,614

(A) Included in net realized gain (loss) on investments on our accompanying Consolidated Statements of Operations for the respective three months ended June 30, 2024 and 2023.

(B) Included in net unrealized appreciation (depreciation) of investments on our accompanying Consolidated Statements of Operations for the respective three months ended June 30, 2024 and 2023.

(A) Included in net realized gain (loss) on investments on our accompanying Consolidated Statements of Operations for the respective three and six months ended September 30, 2024 and 2023.

(B) Included in net unrealized appreciation (depreciation) of investments on our accompanying Consolidated Statements of Operations for the respective three and six months ended September 30, 2024 and 2023.

(C) Includes increases in the cost basis of investments resulting from new portfolio investments, the amortization of discounts and other non-cash disbursements to portfolio companies, as well as decreases in the cost basis of investments resulting from principal repayments or sales, the amortization of premiums and acquisition costs, and other cost-basis adjustments.

(D) The three months ended June 30, 2023 includes $ 0.3 million of proceeds from the recapitalization of Old World Christmas, Inc.

(D) The six months ended September 30, 2023 includes $ 0.3 million of proceeds from the recapitalization of Old World Christmas, Inc.

("Old World").

Investment Activity

During the three months ended June 30, 2024, the following significant transactions occurred:

During the six months ended September 30, 2024, the following significant transactions occurred:

• In May 2024, our remaining shares in Funko were sold representing an exit of our investment in Funko, and resulting in a return of our equity cost basis of $ 21 thousand and a realized gain of $ 2 thousand.

• In July 2024, we invested an additional $ 18.5 million through secured first lien debt in Nocturne Luxury Villas, Inc.

("Nocturne") to fund an add-on acquisition.

• In September 2024, we exited our investment in Nth Degree Investment Group, LLC, which resulted in success fee income of $ 0.1 million, a realized gain on our preferred equity of $ 42.3 million and the repayment of our debt investment of $ 25.0 million.

Investment Concentrations

As of June 30, 2024, our investment portfolio consisted of investments in 23 portfolio companies located in 18 states across 15 different industries with an aggregate fair value of $ 899.1 million.

Our investments in SFEG Holdings, Inc., Old World Christmas, Inc., Nocturne Luxury Villas, Inc.

("Nocturne"), Brunswick Bowling Products, Inc.

and Nth Degree Investment Group, LLC represented our five largest portfolio investments at fair value and collectively comprised $ 384.1 million, or 42.7 %, of our total investment portfolio at fair value as of June 30, 2024.

The following table summarizes our investments by security type as of June 30, 2024 and March 31, 2024:

June 30, 2024 March 31, 2024

As of September 30, 2024, our investment portfolio consisted of investments in 22 portfolio companies located in 18 states across 15 different industries with an aggregate fair value of $ 853.3 million.

Our investments in Nocturne, SFEG Holdings, Inc., Old World, Brunswick Bowling Products, Inc.

and Dema/Mai Holdings, Inc.

represented our five largest portfolio investments at fair value and collectively comprised $ 402.6 million, or 47.2 %, of our total investment portfolio at fair value as of September 30, 2024.

The following table summarizes our investments by security type as of September 30, 2024 and March 31, 2024:

September 30, 2024 March 31, 2024

Cost Fair Value Cost Fair Value

7 unchanged sentences

$ 840,147 100.0 % $ 853,307 100.0 % $ 854,290 100.0 % $ 920,504 100.0 %

Investments at fair value consisted of the following industry classifications as of June 30, 2024 and March 31, 2024:

June 30, 2024 March 31, 2024

Investments at fair value consisted of the following industry classifications as of September 30, 2024 and March 31, 2024:

September 30, 2024 March 31, 2024

Fair Value Percentage of

Total Investments Fair Value Percentage of Total Investments

Diversified/Conglomerate Services $ 239,139 26.6 % $ 264,535 28.7 %

Home and Office Furnishings, Housewares, and Durable Consumer Products $ 164,994 19.3 % $ 160,038 17.3 %

Machinery (Non-Agriculture, Non-Construction, and Non-Electronic) 92,527 10.3 % 92,781 10.1 %

Diversified/Conglomerate Services 164,579 19.3 % 264,535 28.7 %

Hotels, Motels, Inns, and Gaming 98,852 11.6 % 77,366 8.4 %

Machinery (Non-Agriculture, Non-Construction, and Non-Electronic) 92,474 10.8 % 92,781 10.1 %

Buildings and Real Estate 61,749 7.2 % 60,431 6.6 %

11 unchanged sentences

Investments at fair value were included in the following geographic regions of the U.S.

as of June 30, 2024 and March 31, 2024:

June 30, 2024 March 31, 2024

as of September 30, 2024 and March 31, 2024:

September 30, 2024 March 31, 2024

Location Fair Value Percentage of

9 unchanged sentences

Investment Principal Repayments

The following table summarizes the contractual principal repayment and maturity of our investment portfolio by fiscal year, assuming no voluntary prepayments, as of June 30, 2024:

For the remaining nine months ending March 31, 2025

The following table summarizes the contractual principal repayment and maturity of our investment portfolio by fiscal year, assuming no voluntary prepayments, as of September 30, 2024:

For the remaining six months ending March 31, 2025

For the fiscal years ending March 31:

Thereafter 25,000

Total contractual repayments $ 650,480

Investments in equity securities 189,667

Total cost basis of investments held as of June 30, 2024:

Total cost basis of investments held as of September 30, 2024:

Receivables from Portfolio Companies

3 unchanged sentences

We write off accounts receivable when we have exhausted collection efforts and have deemed the receivables uncollectible.

As of June 30, 2024 and March 31, 2024, we had gross receivables from portfolio companies of $ 2.0 million and $ 2.2 million, respectively.

As of June 30, 2024 and March 31, 2024, the allowance for uncollectible receivables was $ 1.5 million and $ 1.4 million, respectively.

As of September 30, 2024 and March 31, 2024, we had gross receivables from portfolio companies of $ 2.1 million and $ 2.2 million, respectively.

As of September 30, 2024 and March 31, 2024, the allowance for uncollectible receivables was $ 1.6 million and $ 1.4 million, respectively.

RELATED PARTY TRANSACTIONS

6 unchanged sentences

The following table summarizes the base management fees, loan servicing fees, incentive fees, and associated non-contractual, unconditional, and irrevocable credits reflected in our accompanying Consolidated Statements of Operations :

Three Months Ended June 30,

Three Months Ended September 30, Six Months Ended September 30,

2024 2023 2024 2023

Average total assets subject to base management fee (A)

1 unchanged sentence

Multiplied by prorated annual base management fee of 2.0 %

0.5 % 0.5 % 1.0 % 1.0 %

Base management fee (B)

4,447 4,341 9,065 8,272

Credits to fees from Adviser - other (B)

2 unchanged sentences

Loan servicing fee (B)

2,194 2,325 4,416 4,497

Credits to base management fee - loan servicing fee (B)

3 unchanged sentences

Incentive fee – capital gains-based (C)

1,638 9,807 ( 2,150 ) 9,874

Total incentive fee (B)

16 unchanged sentences

however, pursuant to the terms of the Advisory Agreement, a small percentage of certain of such fees was retained by the Adviser in the form of reimbursement, at cost, for tasks completed by personnel of the Adviser, primarily related to the valuation of portfolio companies.

For each of the three months ended June 30, 2024 and 2023, these credits totaled $ 75 thousand.

For the three and six months ended September 30,

2024, these credits totaled $ 77 thousand and $ 152 thousand, respectively.

For the three and six months ended September 30, 2023, these credits totaled $ 83 thousand and $ 158 thousand, respectively.

Loan Servicing Fee

16 unchanged sentences

The entire portfolio’s aggregate unrealized capital depreciation, if any, equals the sum of the deficit between the fair value of each investment security as of the applicable calculation date and the original cost of such investment security.

As of June 30, 2024, no capital gains-based incentive fees were contractually due to the Adviser.

As of and for the six months ended September 30, 2024, no capital gains-based incentive fees were contractually due to the Adviser.

During the year ended March 31, 2024, $ 1.1 million capital gains-based incentive fees were contractually due and paid to the Adviser.

5 unchanged sentences

If such amount is negative, then there is no accrual for such period and prior period accruals are reversed, as appropriate.

During the three months ended June 30, 2024, we recorded a reversal of capital gains-based incentive fees of $ 3.8 million.

During the three months ended June 30, 2023, we recorded capital gains-based incentive fees of $ 0.1 million.

As of June 30, 2024 and March 31, 2024, we had accrued capital gains-based incentive fees of $ 33.0 million and $ 36.7 million, respectively.

During the three and six months ended September 30, 2024, we recorded an accrual of capital gains-based incentive fees of $ 1.6 million and a reversal of capital gains-based incentive fees of $ 2.2 million, respectively.

During the three and six months ended ended September 30, 2023, we recorded capital gains-based incentive fees of $ 9.8 million and $ 9.9 million, respectively.

As of September 30, 2024 and March 31, 2024, we had accrued capital gains-based incentive fees of $ 34.6 million and $ 36.7 million, respectively.

Transactions with the Administrator

5 unchanged sentences

On July 9, 2024, our Board of Directors, including a majority of the directors who are not parties to the Administration Agreement or interested persons of either party, approved the annual renewal of the Administration Agreement through August 31, 2025.

Administration fees for each of the three months ended June 30, 2024 and 2023 were $ 0.5 million.

Administration fees for the three and six months ended September 30, 2024 were $ 0.6 million and $ 1.1 million, respectively.

Administration fees for the three and six months ended September 30, 2023 were $ 0.3 million and $ 0.9 million, respectively.

Transactions with Gladstone Securities, LLC

5 unchanged sentences

Any such fees paid by portfolio companies to Gladstone Securities do not impact the fees we pay to the Adviser or the non-contractual, unconditional, and irrevocable credits against the base management fee.

No fees were received by Gladstone Securities from our portfolio companies during the three months ended June 30, 2024.

During the three months ended June 30, 2023, the fees received by Gladstone Securities from our portfolio companies totaled $ 0.3 million.

During the three and six months ended September 30, 2024, the fees received by Gladstone Securities from our portfolio companies totaled $ 0.2 million.

During the three and six months ended months ended September 30, 2023, the fees received by Gladstone Securities from our portfolio companies totaled $ 0.3 million.

Related Party Fees Due

Amounts due to related parties on our accompanying Consolidated Statements of Assets and Liabilities were as follows:

As of June 30,

As of September 30,

As of March 31,

6 unchanged sentences

Total related party fees due $ 38,026 $ 42,071

(A) Includes a capital gains-based incentive fee of $ 33.0 million and $ 36.7 million as of June 30, 2024 and March 31, 2024, respectively, recorded in accordance with GAAP requirements, and which was not contractually due under the terms of the Advisory Agreement.

(A) Includes a capital gains-based incentive fee of $ 34.6 million and $ 36.7 million as of September 30, 2024 and March 31, 2024, respectively, recorded in accordance with GAAP requirements, and which was not contractually due under the terms of the Advisory Agreement.

Refer to Note 4 — Related Party Transactions — Transactions with the Adviser — Incentive Fee for additional information, including capital gains-based incentive fee payments made.

Co-investment expenses as of both June 30, 2024 and March 31, 2024 were $ 0.1 million.

Co-investment expenses as of both September 30, 2024 and March 31, 2024 were $ 0.1 million.

These amounts are generally settled in the quarter subsequent to being incurred and have been included in Other assets, net on the accompanying Consolidated Statements of Assets and Liabilities.

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We, through our wholly-owned subsidiary, Business Investment, are party to a Credit Facility with KeyBank National Association (“KeyBank”), as administrative agent, joint lead arranger and lender, Fifth Third Bank as managing agent, joint lead arranger and lender, the Adviser, as servicer, and certain other lenders party thereto.

As of June 30, 2024, the Credit Facility provides for maximum borrowings of $ 200.0 million, with a revolving period end date of October 30, 2026 and a maturity date of October 30, 2028.

As of September 30, 2024, the Credit Facility provides for maximum borrowings of $ 200.0 million, with a revolving period end date of October 30, 2026 and a maturity date of October 30, 2028.

Advances under the Credit Facility generally bear interest at 30-day Term SOFR, subject to a floor of 0.35 %, plus 3.15 % per annum until October 30, 2026, with the margin then increasing to 3.40 % for the period from October 30, 2026 to October 30, 2027, and increasing further to 3.65 % thereafter with a SOFR credit spread adjustment of 10 basis points.

1 unchanged sentence

The following tables summarize noteworthy information related to the Credit Facility:

As of June 30, 2024

As of September 30, 2024

As of March 31, 2024

3 unchanged sentences

$ 191,100 $ 133,000

For the Three Months Ended June 30,

For the Three Months Ended September 30,

For the Six Months Ended September 30,

2024 2023 2024 2023

Weighted-average borrowings outstanding $ 60,808 $ 50,373 $ 62,766 $ 46,967

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Commitment (unused) fees incurred $ 320 $ 319 $ 661 $ 664

(A) Availability is subject to various constraints, characteristics and applicable advance rates based on collateral quality under the Credit Facility, which equated to an adjusted availability of $ 136.3 million and $ 133.0 million as of June 30, 2024 and March 31, 2024, respectively.

(A) Availability is subject to various constraints, characteristics and applicable advance rates based on collateral quality under the Credit Facility, which equated to an adjusted availability of $ 191.1 million and $ 133.0 million as of September 30, 2024 and March 31, 2024, respectively.

(B) Excludes the impact of deferred financing costs and includes unused commitment fees.

Among other things, the Credit Facility contains a performance guaranty that requires us to maintain:

(i) a minimum net worth of the greater of $ 210.0 million or $ 210.0 million plus 50 % of all equity and subordinated debt raised, minus 50 % of any equity or subordinated debt redeemed or retired after November 16, 2016, which equated to $ 348.7 million as of June 30, 2024;

(ii) asset coverage with respect to senior securities representing indebtedness of at least 150 % (or such percentage as may be set forth in Section 18 of the 1940 Act, as modified by Section 61 of the 1940 Act);

and (iii) our status as a BDC under the 1940 Act and as a RIC under the Code.

As of June 30, 2024, and as defined in the performance guaranty of the Credit Facility, we had a net worth of $ 807.5 million, asset coverage on our senior securities representing indebtedness of 216.3 %, calculated in compliance with the requirements of Sections 18 and 61 of the 1940 Act, and an active status as a BDC and RIC.

As of June 30, 2024, we were in compliance with all covenants under the Credit Facility.

As of September 30, 2024, and as defined in the performance guaranty of the Credit Facility, we had a net worth of $ 789.2 million, asset coverage on our senior securities representing indebtedness of 229.3 %, calculated in compliance with the requirements of Sections 18 and 61 of the 1940 Act, and an active status as a BDC and RIC.

As of September 30, 2024, we were in compliance with all covenants under the Credit Facility.

We elected to apply the fair value option of ASC Topic 825, “ Financial Instruments ,” to the Credit Facility, which was consistent with our application of ASC 820 to our investments.

Generally, the fair value of the Credit Facility is determined using a yield analysis, which includes a DCF calculation and also takes into account the assumptions the Valuation Team believes market participants would use, including the estimated remaining life, counterparty credit risk, current market yield and interest rate spreads of similar securities as of the measurement date.

As of both June 30, 2024 and March 31, 2024, the discount rate used to determine the fair value of the Credit Facility was 30-day Term SOFR, with a 0.35 % floor, plus 3.25 % per annum, plus an unused commitment fee of 1.00 %.

As of both September 30, 2024 and March 31, 2024, the discount rate used to determine the fair value of the Credit Facility was 30-day Term SOFR, with a 0.35 % floor, plus 3.25 % per annum, plus an unused commitment fee of 1.00 %.

Generally, an increase or decrease in the discount rate used in the DCF calculation may result in a corresponding decrease or increase, respectively, in the fair value of the Credit Facility.

As of each of June 30, 2024 and March 31, 2024, the Credit Facility was valued using Level 3 inputs and any changes in its fair value are recorded in Net unrealized appreciation (depreciation) of other on our accompanying Consolidated Statements of Operations.

The following tables provide relevant information and disclosures about the Credit Facility as of June 30, 2024 and March 31, 2024 and for the three months ended June 30, 2024 and 2023, as required by ASC 820:

As of each of September 30, 2024 and March 31, 2024, the Credit Facility was valued using Level 3 inputs and any changes in its fair value are recorded in Net unrealized appreciation (depreciation) of other on our accompanying Consolidated Statements of Operations.

The following tables provide relevant information and disclosures about the Credit Facility as of September 30, 2024 and March 31, 2024 and for the three and six months ended September 30, 2024 and 2023, as required by ASC 820:

Level 3 – Borrowings

2 unchanged sentences

Statements of Assets and Liabilities Using Significant Unobservable Inputs (Level 3)

June 30, 2024 March 31, 2024

September 30, 2024 March 31, 2024

Credit Facility $ 8,900 $ 67,000

2 unchanged sentences

Credit Facility

Three Months Ended June 30, 2024:

Three Months Ended September 30, 2024:

Fair value at June 30, 2024

Borrowings 31,500

Repayments ( 86,300 )

Fair value at September 30, 2024

Six Months Ended September 30, 2024

Fair value at March 31, 2024

1 unchanged sentence

Repayments ( 105,900 )

Unrealized appreciation —

Fair value at September 30, 2024

Fair Value Measurements of Borrowings Using Significant Unobservable Inputs (Level 3)

Reported in Consolidated Statements of Assets and Liabilities

Credit Facility

Three Months Ended September 30, 2023:

Fair value at June 30, 2023

Three Months Ended June 30, 2023

Borrowings 95,200

Repayments ( 62,100 )

Unrealized appreciation (depreciation) ( 52 )

Fair value at September 30, 2023

Six Months Ended September 30, 2023

Fair value at March 31, 2023

1 unchanged sentence

Repayments ( 82,900 )

Unrealized depreciation ( 11 )

Fair value at June 30, 2023

The fair value of the collateral under the Credit Facility was $ 678.9 million and $ 717.3 million as of June 30, 2024 and March 31, 2024, respectively.

Unrealized appreciation (depreciation) ( 63 )

Fair value at September 30, 2023

The fair value of the collateral under the Credit Facility was $ 648.0 million and $ 717.3 million as of September 30, 2024 and March 31, 2024, respectively.

Notes Payable

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Total underwriting discounts, commissions, and offering costs related to this offering were $ 2.5 million, which have been recorded as discounts to the aggregate principal amount on our accompanying Consolidated Statements of Assets and Liabilities and are being amortized over the period ending August 1, 2028, the maturity date.

The following tables summarize our 5.00 % 2026 Notes, 4.875 % 2028 Notes and 8.00 % 2028 Notes as of June 30, 2024 and March 31, 2024:

As of June 30, 2024:

The following tables summarize our 5.00 % 2026 Notes, 4.875 % 2028 Notes and 8.00 % 2028 Notes as of September 30, 2024 and March 31, 2024:

As of September 30, 2024:

Description Ticker

31 unchanged sentences

The 8.00 % 2028 Notes can be redeemed at our option at any time on or after August 1, 2025.

(B) As of June 30, 2024 and March 31, 2024, asset coverage on our senior securities representing indebtedness, calculated pursuant to Sections 18 and 61 of the 1940 Act, was 216.3 % and 219.0 %, respectively.

(B) As of September 30, 2024 and March 31, 2024, asset coverage on our senior securities representing indebtedness, calculated pursuant to Sections 18 and 61 of the 1940 Act, was 229.3 % and 219.0 %, respectively.

The fair value, based on the last reported closing prices, of the 5.00 % 2026 Notes, 4.875 % 2028 Notes and 8.00 % 2028 Notes as of June 30, 2024 was $ 123.4 million, $ 122.5 million, and $ 76.9 million, respectively.

The fair value, based on the last reported closing prices, of the 5.00 % 2026 Notes, 4.875 % 2028 Notes and 8.00 % 2028 Notes as of September 30, 2024 was $ 126.1 million, $ 128.3 million, and $ 77.6 million, respectively.

The fair value, based on the last reported closing prices, of the 5.00 % 2026 Notes, 4.875 % 2028 Notes and 8.00 % 2028 Notes as of March 31, 2024 was $ 123.9 million , $ 123.7 million , and $ 77.3 million , respectively.

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and Virtu Americas LLC (each a “Sales Agent” and, collectively, the "Sales Agents"), under which we have the ability to issue and sell shares of our common stock, from time to time, through the Sales Agents, having an aggregate offering price of up to $ 75.0 million in what is commonly referred to as an “at-the-market” program (the “2024 Common Stock ATM Program”).

We did not sell any shares under the 2024 Common Stock ATM Program during the three months ended June 30, 2024.

As of June 30, 2024, we had remaining capacity to sell all $ 75.0 million of common stock under the 2024 Common Stock ATM program.

We did not sell any shares under the 2024 Common Stock ATM Program during the three months ended September 30, 2024.

As of September 30, 2024, we had remaining capacity to sell all $ 75.0 million of common stock under the 2024 Common Stock ATM program.

In August 2022, we entered into equity distribution agreements with Oppenheimer & Co.

6 unchanged sentences

as a 2022 Sales Agent for the 2022 Common Stock ATM Program.

We did not sell any shares under the 2022 Common Stock ATM Program, which terminated in connection with our entry into the 2024 Common Stock ATM Program, during either the three months ended June 30, 2024 or 2023.

We did not sell any shares under the 2022 Common Stock ATM Program, which terminated in connection with our entry into the 2024 Common Stock ATM Program on May 14, 2024, during the three and six months ended September 30, 2024.

During the three and six months ended September 30, 2023, we sold 304,170 shares of common stock under the 2022 Common Stock ATM Program, with a weighted-average gross price of $ 13.55 per share and a weighted-average net price of $ 13.35 per share after deducting commissions and offering costs borne by us, raising approximately $ 4.1 million and $ 4.1 million of gross and net proceeds, respectively.

All of these sales were above our then current estimated NAV per share.

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS PER WEIGHTED-AVERAGE COMMON SHARE

The following table sets forth the computation of basic and diluted Net increase in net assets resulting from operations per weighted-average common share for the three months ended June 30, 2024 and 2023:

Three Months Ended June 30,

Net (decrease) increase in net assets resulting from operations

The following table sets forth the computation of basic and diluted net increase in net assets resulting from operations per weighted-average common share for the three and six months ended September 30, 2024 and 2023:

Three Months Ended September 30, Six Months Ended September 30,

2024 2023 2024 2023

Net increase in net assets resulting from operations

$ 15,482 $ 47,356 $ 8,956 $ 56,142

Basic and diluted weighted-average common shares

36,688,667 33,817,214 36,688,667 33,704,976

Basic and diluted net (decrease) increase in net assets resulting from operations per weighted-average common share

Basic and diluted net increase in net assets resulting from operations per weighted-average common share

$ 0.42 $ 1.40 $ 0.24 $ 1.67

6 unchanged sentences

Estimates made on a quarterly basis are updated as of each interim reporting date.

If we determined the tax characterization of cash distributions paid to common stockholders during the current calendar year as of June 30, 2024, 67.8 % would be from from ordinary income and 32.2 % would be from capital gains.

We paid the following cash distributions to our common stockholders for the three months ended June 30, 2024 and 2023:

For the Three Months Ended June 30, 2024 :

If we determined the tax characterization of cash distributions paid to common stockholders during the current calendar year as of September 30, 2024, 51.0 % would be from from ordinary income and 49.0 % would be from capital gains.

We paid the following cash distributions to our common stockholders for the six months ended September 30, 2024 and 2023:

For the Six Months Ended September 30, 2024 (A) :

Declaration Date

3 unchanged sentences

April 9, 2024 June 19, 2024 June 28, 2024 0.08

Three Months Ended June 30, 2024 $ 0.24

For the Three Months Ended June 30, 2023 :

July 9, 2024 July 22, 2024 July 31, 2024 0.08

July 9, 2024 August 21, 2024 August 30, 2024 0.08

July 9, 2024 September 20, 2024 September 30, 2024 0.08

Six Months Ended September 30, 2024 $ 0.48

For the Six Months Ended September 30, 2023 :

Declaration Date

2 unchanged sentences

April 11, 2023 May 23, 2023 May 31, 2023 0.08

April 11, 2023 June 5, 2023 June 15, 2023 0.12 (A)

April 11, 2023 June 5, 2023 June 15, 2023 0.12 (B)

April 11, 2023 June 21, 2023 June 30, 2023 0.08

Three Months Ended June 30, 2023 $ 0.36

(A) Represents a supplemental distribution to common stockholders.

Aggregate cash distributions to our common stockholders declared and paid were $ 8.8 million and $ 12.1 million for the three months ended June 30, 2024 and 2023, respectively.

July 11, 2023 July 21, 2023 July 31, 2023 0.08

July 11, 2023 August 23, 2023 August 31, 2023 0.08

July 11, 2023 September 7, 2023 September 15, 2023 0.12 (B)

July 11, 2023 September 21, 2023 September 29, 2023 0.08

Six Months Ended September 30, 2023 $ 0.72

(A) On September 17, 2024, our Board of Directors also declared a supplemental distribution of $ 0.70 per common share to stockholders of record on October 4, 2024, which was paid on October 15, 2024.

(B) Represents a supplemental distribution to common stockholders.

Aggregate cash distributions to our common stockholders declared was $ 43.3 million, of which $ 17.6 million was paid during the six months ended September 30, 2024, and $ 25.7 million was paid in October 2024.

Aggregate cash distributions to our common stockholders declared and paid was $ 24.3 million for the six months ended September 30, 2023.

For the fiscal year ended March 31, 2024, Investment Company Taxable Income exceeded distributions declared and paid, and, in accordance with Section 855(a) of the Code, we elected to treat $ 18.7 million of the first distributions paid subsequent to fiscal year-end, as having been paid in the prior year.

In addition, for the fiscal year ended March 31, 2024 net capital gains exceeded distributions declared and paid, and, in accordance with Section 855(a) of the Code, we elected to treat $ 1.4 million of the first distributions paid subsequent to fiscal year-end as having been paid in the prior year.

For the three months ended June 30, 2024, we recorded $ 0.2 million of net adjustments for estimated permanent book-tax differences to reflect tax character, which decreased Capital in excess of par value and increased Overdistributed net investment income on our accompanying Consolidated Statements of Assets and Liabilities .

For the three months ended June 30, 2023, we recorded $ 0.6 million of net adjustments for estimated permanent book-tax differences to reflect tax character, which increased Capital in excess of par value and Overdistributed net investment income and decreased Accumulated net realized gain in excess of distributions on our accompanying Consolidated Statements of Assets and Liabilities .

For the three months ended September 30, 2024, we recorded $ 0.6 million of net adjustments for estimated permanent book-tax differences to reflect tax character, which decreased Capital in excess of par value and increased Overdistributed net investment income on our accompanying Consolidated Statements of Assets and Liabilities .

For the three months ended September 30, 2023, we recorded $ 0.5 million of net adjustments for estimated permanent book-tax differences to reflect tax character, which increased Capital in excess of par value and Overdistributed net investment income and decreased Accumulated net realized gain in excess of distributions on our accompanying Consolidated Statements of Assets and Liabilities .

For the six months ended September 30, 2024, we recorded $ 0.8 million of net adjustments for estimated permanent book-tax differences to reflect tax character, which decreased Capital in excess of par value and increased Overdistributed net investment income on our accompanying Consolidated Statements of Assets and Liabilities .

For the six months ended September 30, 2023, we recorded $ 0.1 million of net adjustments for estimated permanent book-tax differences to reflect tax character, which increased Capital in excess of par value and Overdistributed net investment income and decreased Accumulated net realized gain in excess of distributions on our accompanying Consolidated Statements of Assets and Liabilities .

We may distribute our net long-term capital gains, if any, in cash or elect to retain some or all of such gains, pay taxes at the U.S.

11 unchanged sentences

Based on current knowledge, we do not believe that loss contingencies, if any, arising from pending investigations, litigation or regulatory matters will have a material adverse effect on our financial condition, results of operation or cash flows.

Additionally, based on our current knowledge, we do not believe such loss contingencies are both probable and estimable and therefore, as of June 30, 2024 and March 31, 2024, we had no established reserves for such loss contingencies.

Additionally, based on our current knowledge, we do not believe such loss contingencies are both probable and estimable and therefore, as of September 30, 2024 and March 31, 2024, we had no established reserves for such loss contingencies.

Escrow Holdbacks

2 unchanged sentences

We establish reserves and holdbacks against escrow amounts if we determine that it is probable and estimable that a portion of the escrow amounts will not ultimately be released or received at the end of the escrow period.

Reserves and holdbacks against escrow amounts were $ 0.4 million and $ 1.0 million as of June 30, 2024 and March 31, 2024, respectively.

Reserves and holdbacks against escrow amounts were $ 1.4 million and $ 1.0 million as of September 30, 2024 and March 31, 2024, respectively.

Financial Commitments and Obligations

1 unchanged sentence

Since these lines of credit commitments have expiration dates and we expect many will never be fully drawn, the total line of credit commitment amounts do not necessarily represent future cash requirements.

We estimate the fair value of the combined unused line of credit commitments as of June 30, 2024 and March 31, 2024 to be insignificant.

The following table summarizes the principal balances of unused line of credit as of June 30, 2024 and March 31, 2024, which are not reflected as liabilities in the accompanying Consolidated Statements of Assets and Liabilities:

June 30, 2024 March 31, 2024

We estimate the fair value of the combined unused line of credit commitments as of September 30, 2024 and March 31, 2024 to be insignificant.

The following table summarizes the principal balances of unused line of credit as of September 30, 2024 and March 31, 2024, which are not reflected as liabilities in the accompanying Consolidated Statements of Assets and Liabilities:

September 30, 2024 March 31, 2024

Unused line of credit commitments

2 unchanged sentences

FINANCIAL HIGHLIGHTS

Three Months Ended June 30,

Three Months Ended September 30, Six Months Ended September 30,

2024 2023 2024 2023

Per Common Share Data:

2 unchanged sentences

Income from investment operations (B)

Net investment income

Net investment income (loss)

0.20 ( 0.05 ) 0.54 0.20

Net realized gain

Net unrealized depreciation ( 0.52 ) ( 0.02 )

1.15 0.01 1.15 0.04

Net unrealized (depreciation)/appreciation ( 0.93 ) 1.44 ( 1.45 ) 1.43

Total income from investment operations

4 unchanged sentences

Cash distributions to common stockholders from net realized gains (C)

( 0.70 ) ( 0.16 ) ( 0.70 ) ( 0.31 )

Total from equity capital activity

1 unchanged sentence

Other, net (B)(E)

— — — ( 0.01 )

Net asset value at end of period (A)

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(H) Ratio of net expenses to average net assets is computed using total expenses, net of any non-contractual, unconditional, and irrevocable credits of fees from the Adviser.

Had we not received any non-contractual, unconditional, and irrevocable credits of fees from the Adviser, the ratio of expenses to average net assets - annualized would have been 10.34 % and 13.95 % for the three months ended June 30, 2024 and 2023, respectively.

(I) Had we not received any non-contractual, unconditional, and irrevocable credits of fees from the Adviser, the ratio of net investment income (loss) to average net assets - annualized would have been 7.85 % and 4.55 % for the three months ended June 30, 2024 and 2023, respectively.

Had we not received any non-contractual, unconditional, and irrevocable credits of fees from the Adviser, the ratio of expenses to average net assets - annualized would have been 15.40 % and 23.30 % for the three months ended September 30, 2024 and 2023, respectively, and 12.83 % and 18.70 % for the six months ended September 30, 2024 and 2023, respectively.

(I) Had we not received any non-contractual, unconditional, and irrevocable credits of fees from the Adviser, the ratio of net investment income (loss) to average net assets - annualized would have been 3.76 % and ( 5.39 )% for the three months ended September 30, 2024 and 2023, respectively, and 5.84 % and ( 0.50 )% for the six months ended September 30, 2024 and 2023, respectively.

UNCONSOLIDATED SIGNIFICANT SUBSIDIARIES

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Further, in accordance with ASC 946, we are precluded from consolidating any entity other than another investment company, except that ASC 946 provides for the consolidation of a controlled operating company that provides substantially all of its services to the investment company or its consolidated subsidiaries.

We did not have any unconsolidated subsidiaries that met any of the significance conditions under Rule 1-02(w) of the SEC’s Regulation S-X as of or during the three months ended June 30, 2024 and 2023.

We did not have any unconsolidated subsidiaries that met any of the significance conditions under Rule 1-02(w) of the SEC’s Regulation S-X as of or during the six months ended September 30, 2024 and 2023.

SUBSEQUENT EVENTS

Investment Activity

• In July 2024, we invested an additional $ 18.5 million through secured first lien debt in Nocturne to fund an add-on acquisition.

Distributions and Dividends

In July 2024, our Board of Directors declared the following monthly distributions to common stockholders:

• In October 2024, our Board of Directors declared the following monthly distributions to common stockholders:

Payment Date Distribution per Common Share

July 22, 2024 July 31, 2024 $ 0.08

August 21, 2024 August 30, 2024 0.08

September 20, 2024 September 30, 2024 0.08

October 22, 2024 October 31, 2024 $ 0.08

November 20, 2024 November 29, 2024 0.08

December 20, 2024 December 31, 2024 0.08

Total for the Quarter:

• On October 15, 2024, we also paid to common stockholders the following supplemental distribution previously declared by our Board of Directors on September 17, 2024:

Record Date Payment Date Distribution per Common Share

October 4, 2024 October 15, 2024 $ 0.70

Total for the Quarter:

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements