What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2022-05-05 compared with 2021-11-04 · 160 added, 208 removed, 428 unchanged (46% of the section changed)

6 unchanged sentences

These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including without limitation:

● changes in political, economic or industry conditions, the interest rate environment or conditions affecting the financial and capital markets, including changes from the impact of the current COVID-19 pandemic;

● our ability to continue to effectively manage our business due to the disruptions caused by the current COVID-19 pandemic;

3 unchanged sentences

● interest rate volatility that could adversely affect our results, particularly to the extent that we use leverage as part of our investment strategy;

● the impact of interest and inflation rates on our business prospects and the prospects of our portfolio companies;

● our future operating results, including our ability to achieve objectives as a result of the COVID-19 pandemic;

13 unchanged sentences

● the effect of legal, tax, and regulatory changes;

● the other risks, uncertainties and other factors we identify under “Risk Factors” in Part I, Item 1A of our annual report on Form 10-K for the fiscal year ended December 31, 2020 and in our other filings with the Securities and Exchange Commission (the “SEC”).

● the other risks, uncertainties and other factors we identify under “Risk Factors” in Part I, Item 1A of our annual report on Form 10 K, as modified by the annual report on Form 10-K/A for the year ended December 31, 2021, filed with the SEC on March 2, 2022 and March 14, 2022, respectively and in our other filings with the Securities and Exchange Commission (the “SEC”).

Although we believe the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those assumptions also could be inaccurate.

In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this quarterly report on Form 10 Q should not be regarded as a representation by us that our plans and objectives will be achieved.

These risks and uncertainties include those described or identified in “Risk Factors” in in Part I, Item 1A of our annual report on Form 10-K for the fiscal year ended December 31, 2020, filed with the SEC on March 11, 2021.

These risks and uncertainties include those described or identified in “Risk Factors” in in Part I, Item 1A of our annual report on Form 10 K, as modified by the annual report on Form 10-K/A for the year ended December 31, 2021, filed with the SEC on March 2, 2022 and March 14, 2022, respectively.

We have based the forward-looking statements included in this Form 10-Q on information available to us on the date of this Form 10-Q, and we assume no obligation to update any such forward-looking statements.

8 unchanged sentences

We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”).

We will remain an emerging growth company until the last day of our fiscal year following the fifth anniversary of our initial public offering on October 25, 2021 (“IPO”), or until the earliest of (i) the last day of the first fiscal year in which we have total annual gross revenue of $1,070,000,000 or more, (ii) December 31 of the fiscal year in which we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (together with the rules and regulations promulgated thereunder, the “Exchange Act”), (which would occur if the market value of our common stock held by non-affiliates exceeds $700.0 million, measured as of the last business day of our most recently completed second fiscal quarter, and we have been publicly reporting for at least 12 months), or (iii) the date on which we have issued more than $1.0 billion in non-convertible debt during the preceding three-year period.

We will remain an emerging growth company until the last day of our fiscal year following the fifth anniversary of our IPO on October 25, 2021, or until the earliest of (i) the last day of the first fiscal year in which we have total annual gross revenue of $1,070,000,000 or more, (ii) December 31 of the fiscal year in which we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (together with the rules and regulations promulgated thereunder, the “Exchange Act”), (which would occur if the market value of our common stock held by non-affiliates exceeds $700.0 million, measured as of the last business day of our most recently completed second fiscal quarter, and we have been publicly reporting for at least 12 months), or (iii) the date on which we have issued more than $1.0 billion in non-convertible debt during the preceding three-year period.

For so long as we remain an emerging growth company under the JOBS Act, we will be subject to reduced public company reporting requirements.

1 unchanged sentence

The Administrator, a wholly-owned subsidiary of RGC, provides all the administrative services necessary for us to operate.

In October 2015, in connection with the our formation, we issued and sold 1,667 shares of common stock to R.

In October 2015, in connection with our formation, we issued and sold 1,667 shares of common stock to R.

David Spreng, our President, Chief Executive Officer and Chairman of our Board of Directors, for an aggregate purchase price of $25,000.

The sale of shares of common stock was approved by the unanimous consent of the sole director at the time.

Between December 2016 and December 2017, we completed our first private offering of shares of common stock to investors (the “Initial Private Offering”) in reliance on exemptions from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), and other applicable securities laws.

As of September 30, 2021, in connection with the Initial Private Offering, we had issued 18,241,157 shares of its common stock for a total purchase price of $275,000,000.

As of September 30, 2021, we have completed multiple closings under our second private offering (the “Second Private Offering”) and had accepted aggregate capital commitments of $181,673,500.

As of September 30, 2021, we have issued 9,617,379 shares of common stock for a total purchase price of $144,260,683 in connection with the Second Private Offering and $37,412,817 of capital commitments remain undrawn.

As of September 30, 2021, we issued 22,564 shares as an additional direct investment by Runway Growth Holdings LLC, an affiliate of RGC, for a total purchase price of $338,453.

As of September 30, 2021, we have issued an additional 6,647,847 shares as part of the dividend reinvestment program.

Refer to Note 6 for further detail.

On December 1, 2017, we completed our Initial Private Offering, in which we issued 18,241,157 shares of our common stock to stockholders for a total purchase price of $275,000,000 in reliance on exemptions from the registration requirements of the Securities Act, and other applicable securities laws.

As of March 31, 2022, we had completed multiple closings under our second private offering (the “Second Private Offering”) and had accepted aggregate capital commitments of $181,673,500.

As of March 31, 2022, in connection with the Second Private Offering we have issued 9,617,379 shares of our common stock for a total purchase price of $144,260,683.

Concurrent with the IPO, all undrawn commitments under the Second Private Offering were cancelled.

On October 25, 2021, we closed our IPO, issuing 6,850,000 shares of our common stock at a public offering price of $14.60 per share.

Net of underwriting fees and offering costs, we received net cash proceeds of $93.0 million.

We have granted the underwriters an option to purchase up to an additional 1,027,500 shares of common stock at the public offering price, less the sales load payable by us, on or before November 19, 2021.

Our common stock began trading on the Nasdaq Global Select Market under the symbol “RWAY” on October 21, 2021.

As of March 31, 2022, we have issued 22,564 shares as an additional direct investment by Runway Growth Holdings LLC, an affiliate of RGC, for a total purchase price of $338,453.

As of March 31, 2022, we have issued an additional 6,647,847 shares as part of our dividend reinvestment plan.

Refer to Note 6 for further detail.

On August 10, 2020, we, RGC, and certain other funds and accounts sponsored or managed by RGC and/or its affiliates were granted an order (the “Order”) that permits us greater flexibility than the 1940 Act permits to negotiate the terms of co-investments if the Board determines that it would be advantageous for us to co-invest with other accounts sponsored or managed by RGC or its affiliates in a manner consistent with our investment objective or criteria, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors.

1 unchanged sentence

Under the terms of the Order, a majority of our independent directors are required to make certain determinations in connection with a co-investment transaction, including that (1) the terms of the proposed transaction are reasonable and fair to us and our stockholders and do not involve overreaching of us or our stockholders on the part of any person concerned and (2) the transaction is consistent with the interests of our stockholders and is consistent with our investment objective, criteria, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors.

In addition, pursuant to an exemptive order issued by the SEC on April 8, 2020 and applicable to all BDCs with exemptive orders, through December 31, 2020, we were permitted, subject to the satisfaction of certain conditions, to co-invest in our existing portfolio companies with certain affiliates that are private funds even if such other funds had not previously invested in such existing portfolio company.

Without this order, such affiliated funds that are private funds would not be able to participate in such co-investments with us unless the affiliated funds had previously acquired securities of the portfolio company in a co-investment transaction with us.

Although the conditional exemptive order expired on December 31, 2021, the SEC’s Division of Investment Management indicated that until March 31, 2022, it would not recommend enforcement action, to the extent that any BDC with an existing co-investment order continued to engage in certain transactions described in the conditional exemptive order, pursuant to the same terms and conditions described therein.

In connection with the expiration of the conditional exemptive order, the Division of Investment Management has indicated that, although BDCs would not be able to rely on the conditional exemptive order subsequent to March 31, 2022, BDCs can apply to amend their existing orders to permanently implement the relief.

We intend to file an amendment to our existing Order to permanently implement the relief, but there is no guarantee that such amendment will be granted.

Portfolio Composition and Investment Activity

Portfolio Composition

At September 30, 2021, we had investments in 38 portfolio companies, representing 19 companies in which we held loan and warrant investments, three companies in which we held loan investments and shares of common, preferred stock, or a combination with warrants, one company in which we held a loan investment only, 10 companies in which we held warrant investments only, five companies in which we held shares of common or preferred stock only, or a combination with warrants, and we held one U.S.

Treasury Bill.

At December 31, 2020, we had investments in 31 portfolio companies, representing 22 companies in which we held loan and warrant investments, six companies in which we held warrant interests only, one company in which we held bonds, and we held one

At March 31, 2022, we had investments in 40 portfolio companies, representing 19 companies in which we held loan and warrant investments, four companies in which we held loan investments and shares of common, preferred stock, or a combination with warrants, three companies in which we held a loan investment only, nine companies in which we held warrant investments only, and five companies in which we held shares of common or preferred stock only, or a combination with warrants.

At December 31, 2021, we had investments in 39 portfolio companies, representing 20 companies where we held loan and warrant investments, 12 companies where we held warrant interests only, and we held one U.S.

Treasury Bill.

The following table shows the fair value of our investments, by asset class, as of September 30, 2021 and December 31, 2020:

September 30, 2021 (Unaudited)

The following table shows the fair value of our investments, by asset class, as of March 31, 2022 and December 31, 2021:

March 31, 2022 (Unaudited)

December 31, 2021

1 unchanged sentence

Common Stocks

Corporate Bonds

Senior Secured Term Loans

Second Lien Term Loans

Preferred Stocks

2 unchanged sentences

Total Investments

For the three and nine months ended September 30, 2021, our debt investment portfolio had a dollar-weighted annualized yield of 15.34% and 14.17%, respectively.

For the three and nine months ended September 30, 2020, our debt investment portfolio had a dollar-weighted annualized yield of 14.81% and 15.25%, respectively.

For the three months ended March 31, 2022, our debt investment portfolio had a dollar-weighted annualized yield of 12.15%.

For the three months ended March 31 , 2021, our debt investment portfolio had a dollar-weighted annualized yield of 13.45%.

We calculate the yield on dollar-weighted debt investments for any period measured as (1) total related investment income during the period divided by (2) the daily average of the fair value of debt investments outstanding during the period.

As of September 30, 2021, our debt investments had a dollar-weighted average outstanding term of 46 months at origination and a dollar-weighted average remaining term of 33 months, or approximately 2.7 years.

As of September 30, 2021, substantially all of our debt investments had an original committed principal amount of between $6 million and $50 million, repayment terms of between 34 months and 60 months and pay cash interest at annual interest rates of between 5.50% and 12.00%.

The following table shows our dollar-weighted annualized yield by investment type for the three and nine months ended September 30, 2021 and September 30, 2020:

As of March 31, 2022, our debt investments had a dollar-weighted average outstanding term of 48 months at origination and a dollar-weighted average remaining term of 36 months, or approximately 3.0 years.

As of March 31, 2022, substantially all of our debt investments had an original committed principal amount of between $6 million and $75 million, repayment terms of between 34 months and 60 months and pay cash interest at annual interest rates of between 5.92% and 12.00%.

The following table shows our dollar-weighted annualized yield by investment type for the three months ended March 31, 2022 and March 31 , 2021:

Fair Value (1)

Three Months Ended

Nine Months Ended

Three Months Ended

Nine Months Ended

September 30, 2021

September 30, 2020

September 30, 2021

September 30, 2020

September 30, 2021

September 30, 2020

September 30, 2021

September 30, 2020

March 31, 2022

March 31, 2021

March 31, 2022

March 31, 2021

Investment type:

8 unchanged sentences

The value of our investment portfolio will change over time due to changes in the fair value of our underlying investments, as well as changes in the composition of our portfolio resulting from purchases of new and follow-on investments as well as repayments and sales of existing investments.

During the nine months ended September 30, 2021, the Company funded $140.1 million in nine new portfolio companies and $97.0 million in ten existing portfolio companies.

The Company also received $196.4 million in loan repayments from 12 portfolio companies.

During the nine months ended September 30, 2020, the Company funded $150.8 million in eight new portfolio companies and $14.9 million in six existing portfolio companies.

The Company also received $76.1 million in loan repayments from eight portfolio companies and $2.9 million in proceeds from the termination of warrants.

During the three months ended March 31, 2022, the Company funded $42.1 million in two new portfolio companies and $40.7 million in four existing portfolio companies, net of upfront loan origination fees.

The Company also received $7.6 million in a loan repayment from one portfolio company and $0.3 million in proceeds from the termination of warrants.

During the three months ended March 31, 2021, the Company funded $34.7 million in two new portfolio companies and $19.3 million in five existing portfolio companies.

The Company also received $16.6 million in loan repayments from four portfolio companies.

Portfolio Reconciliation

The following is a reconciliation of our investment portfolio, including U.S.

Treasury Bills, for the nine months ended September 30, 2021 and 2020:

Nine Months Ended

September 30, 2021

September 30, 2020

Treasury Bills, for the three months ended March 31, 2022 and 2021:

Three Months Ended

March 31, 2022

March 31, 2021

Beginning Investment Portfolio

4 unchanged sentences

Sales or Repayments of Investments

(197,534,296)

Scheduled Principal Payments of Investments

1 unchanged sentence

Treasury Bills

(124,999,118)

(194,985,264)

Realized (Loss) on Investments

Realized Gain (Loss) on Investments

Net Change in Unrealized Appreciation (Depreciation) on Investments

1 unchanged sentence

(1) Includes PIK interest.

(2) Excludes $25,999,624 in U.S.

Treasury Bills sold short for the nine months ended September 30, 2020.

Asset Quality

26 unchanged sentences

May experience partial and/or full loss.

The following table shows the investment ratings of our debt investments at fair value as of September 30, 2021 and December 31, 2020:

As of September 30, 2021

The following table shows the investment ratings of our debt investments at fair value as of March 31, 2022 and December 31, 2021:

March 31, 2022 (Unaudited)

As of December 31, 2021

3 unchanged sentences

Generally, when interest and/or principal payments on a loan become past due, or if we otherwise do not expect the borrower to be able to service its debt and other obligations, we will place the loan on non-accrual status and will generally cease recognizing interest income on that loan for financial reporting purposes until all principal and interest have been brought current through payment or due to a restructuring such that the interest income is deemed to be collectible.

As of September 30, 2021, the Company had six loans to Mojix, Inc.

and one loan to Pivot3 Holdings, Inc., representing an aggregate principal funded of $30,383,707 at a fair value of $23,147,803, on non-accrual status, which represents 4.59% of the Company’s net assets.

As of December 31, 2020, we had nine loans to Mojix, Inc.

representing an aggregate principal funded of $11,000,000 at a fair market value of $8,961,080, on non-accrual status, which represents 1.92% of our net assets .

As of March 31, 2022, we had one loan to Pivot3 Holdings, Inc., representing an aggregate principal funded of $18,598,265 at a fair value of $14,649,788 on non-accrual status, which represents 2.45% of the Company’s net assets.

As of December 31, 2021, we had six loans to Mojix, Inc.

and one loan to Pivot3 Holdings, Inc., representing an aggregate principal funded of $30,278,707 at a fair value of $28,259,976, on non-accrual status, which represented 4.66% of our net assets .

Results of Operations

3 unchanged sentences

Net unrealized appreciation/(depreciation) on investments is the net change in the fair value of our investment portfolio.

Comparison of the Three Months Ended September 30, 2021 and 2020

Comparison of the Three Months Ended March 31, 2022 and 2021

Three Months Ended

September 30, 2021

September 30, 2020

March 31, 2022

March 31, 2021

Investment income

7 unchanged sentences

Overhead allocation expense

Insurance expense

Administration fees

Credit facility fees

Debt financing fees

Directors’ fees

5 unchanged sentences

Net increase in net assets resulting from operations

(1) The basic per share figures noted above are based on weighted averages of 33,160,481 and 27,271,559 shares outstanding for the three months ended September 30, 2021 and 2020, respectively.

(1) The basic per share figures noted above are based on weighted averages of 41,375,187 and 31,505,254 shares outstanding for the three months ended March 31, 2022 and 2021, respectively.

Investment Income

9 unchanged sentences

In some cases, some of our investments may provide for deferred interest payments or PIK interest.

The principal amount of the debt securities and any accrued but unpaid interest generally will

become due at the maturity date.

The principal amount of the debt securities and any accrued but unpaid interest generally will become due at the maturity date.

In addition, we may generate revenue in the form of commitment and other fees in connection with transactions.

4 unchanged sentences

Other non-recurring income consisting of amendment fees, legal fees, reimburseable income, and any other fee income for services rendered, if any, are recorded as other income when earned.

Investment income for the three months ended September 30, 2021 and 2020 was $18,610,066 and $14,215,723, respectively, and includes non-recurring income of $3,403,585 and $295,523, respectively.

The increase in investment income for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was primarily due to interest income and driven by our deployment of capital, increased invested balance, prepayments, and end-of-term payments, partially offset by falling market interest rates.

Investment income for the three months ended March 31 , 2022 and 2021 was $19,258,898 and $16,422,773, respectively, and includes non-recurring income of $823,299 and $602,109, respectively.

The increase in investment income for the three months ended March 31 , 2022 compared to the three months ended March 31 , 2021 was primarily due to interest income and driven by our deployment of capital, increased invested balance, prepayments, end-of-term payments, and increased market interest rates.

Operating Expenses

1 unchanged sentence

We bear all other out-of-pocket costs and expenses of our operations and transactions, including those relating to:

● fees and expenses related to public and private offerings;

● sales and repurchases of our securities;

● our pro-rata portion of fees and expenses related an initial public offering of the Public Fund in connection with a Spin-Off transaction;

● fees and expenses related to public and private offerings, sales and repurchases of our securities;

● calculating our net asset value (including the cost and expenses of any independent valuation firm);

14 unchanged sentences

● all other expenses incurred by us, our Administrator or RGC in connection with administering our business, including payments under the Administration Agreement based on our allocable portion of our Administrator’s overhead in performing its obligations under the Administration Agreement, including rent and the allocable portion of the cost of our Chief Compliance Officer and Chief Financial Officer and their respective staffs.

Operating expenses for the three months ended September 30, 2021 and 2020 were $7,868,943 and $4,693,143, respectively.

Operating expenses increased for the three months ended September 30, 2021 from the three months ended September 30, 2020 primarily due to an increase in incentive fees, management fees, credit facility fees, and interest expense due to an increase in leverage utilization.

Operating expenses per share for the three months ended September 30, 2021 and 2020 were $0.24 per share and $0.17 per share, respectively.

Operating expenses for the three months ended March 31, 2022 and 2021 were $6,799,005 and $4,941,040 respectively.

Operating expenses increased for the three months ended March 31, 2022 from the three months ended March 31, 2021 primarily due to an increase in incentive fees, management fees, credit facility fees, and interest expense.

Operating expenses per share for the three months ended March 31, 2022 and 2021 were $0.16 per share and $0.16 per share, respectively.

Incentive Fees

Incentive fees for the three months ended September 30, 2021 and 2020 were $2,686,475 and $1,650,930, respectively, incurred primarily due to net investment income.

Incentive fees increased for the three months ended September 30, 2021 from the three months ended September 30, 2020 primarily due to an increase in net investment income arising from prepayments.

$2,171,245 of the incentive fees for the three months ended September 30, 2021 were earned, payable in cash, and included under Accrued incentive fees on the Statement of Assets and Liabilities as of September 30, 2021.

$515,230 of the incentive fees for the three months ended September 30, 2021 were deferred and accrued, and included in Accrued incentive fees on the Statement of Assets and Liabilities as of September 30, 2021.

$1,126,379 of the incentive fees for the three months ended September 30, 2020 were earned, payable in cash, and included under Accrued incentive fees on the Statement of Assets and Liabilities as of September 30, 2020.

$524,551 of the incentive fees for the three months ended September 30, 2020 were deferred and accrued, and included under Accrued incentive fees on the Statement of Assets and Liabilities as of September 30, 2020.

Incentive fees for the three months ended March 31, 2022 and 2021 were $1,343,996 and $975,704, respectively.

Incentive fees increased for the three months ended March 31, 2022 from the three months ended March 31, 2021 primarily due to an increase in net investment income arising from increased market interest rates.

$1,056,223 of the incentive fees for the three months ended March 31, 2022 were earned, payable in cash, and included under Accrued incentive fees on the Statement of Assets and Liabilities as of March 31, 2022.

$287,773 of the incentive fees for the three months ended March 31, 2022 were deferred and accrued, and included in Accrued incentive fees on the Statement of Assets and Liabilities as of March 31, 2022.

$739,231 of the incentive fees for the three months ended March 31, 2021 were earned, payable in cash, and included under Accrued incentive fees on the Statement of Assets and Liabilities as of March 31, 2021.

$236,473 of the incentive fees for the three months ended March 31, 2021 were deferred and accrued, and included under Accrued incentive fees on the Statement of Assets and Liabilities as of March 31, 2021.

Incentive fees related to PIK or deferred interest are accrued and payment is deferred until such interest is collected in cash.

Incentive fees per share for the three months ended September 30, 2021 and September 30, 2020 were $0.08 and $0.06 per share, respectively.

Incentive fees per share for the three months ended March 31, 2022 and March 31, 2021 were $0.03 and $0.03 per share, respectively.

Net Investment Income

Net investment income for the three months ended September 30, 2021 and 2020 was $10,741,123 and $9,522,580, respectively.

Net investment income increased for the three months ended September 30, 2021 from the three months ended September 30, 2020, primarily due to an increase in interest income resulting from an increase in the size of the investment portfolio and an increase in prepayments.

Net investment income per share for the three months ended September 30, 2021 and 2020 was $0.32 per share and $0.35 per share, respectively.

Net investment income for the three months ended March 31, 2022 and 2021 was $12,459,893 and $11,481,733 respectively.

Net investment income increased for the three months ended March 31, 2022 from the three months ended March 31, 2021, primarily due to an increase in interest income resulting from an increase in the size of the investment portfolio and increased market interest rates.

Net investment income per share for the three months ended March 31, 2022 and 2021 was $0.30 per share and $0.36 per share, respectively.

Net Realized Gain (Loss) on Investments

The net realized gain on investments of $718,311 for the three months ended September 30, 2021 was primarily due to the gain on a portion of our investment in the common stock of Porch Group, Inc.

and Ouster, Inc.

and warrants of Brilliant Earth LLC.

The net realized gain on investments of $1,142,706 for the three months ended September 30, 2020 was primarily due to the gain on our investment in the common stock of Hercules Capital Inc.

Net Change in Unrealized Appreciation (Depreciation) on Investments

Net change in unrealized depreciation on investments of $1,228,382 for the three months ended September 30, 2021 was primarily due to decreases in the fair value of our common stock in Ouster, Inc.

and warrants in CareCloud, Inc.

and Circadence Corporation and partially offset by an increase in the fair value of our senior secured loans in Mojix, Inc.

The net change in unrealized

appreciation on investments of $243,742 for the three months ended September 30, 2020 was primarily due to increases in the fair value of our senior secured loan to Brilliant Earth LLC and our investments in the warrants of MTBC, Inc.

and Aspen Group, Inc.

This was partially offset by decreases in the fair value of our senior secured loan to Pivot3, Inc.

and our investment in the preferred stock of MTBC, Inc.

Net Increase in Net Assets Resulting from Operations

We had a net increase in net assets resulting from operations of $10,231,052 for the three months ended September 30, 2021, as compared to a net increase in net assets resulting from operations of $10,909,028 for the three months ended September 30, 2020.

The net decrease in net assets resulting from operations for the three months ended September 30, 2021 from the three months ended September 30, 2020 was primarily due to a decrease in unrealized appreciation in our portfolio and an increase in operating expenses for the three months ended September 30, 2021.

Comparison of the Nine Months Ended September 30, 2021 and 2020

Nine Months Ended

September 30, 2021

September 30, 2020

Investment income

Interest and dividend income

Total investment income

Operating expenses

Management fees

Incentive fees

Interest expense

Professional fees

Overhead allocation expense

Administration fees

Credit facility fees

Directors’ fees

Other expenses

Total operating expenses

Net investment income

Realized (loss) on investments

Net change in unrealized appreciation (depreciation) on investments

Net increase in net assets resulting from operations

(2) The basic per share figures noted above are based on weighted averages of 32,360,107 and 26,603,966 shares outstanding for the nine months ended September 30, 2021 and 2020, respectively.

Investment Income

Investment income for the nine months ended September 30, 2021 and 2020 was $53,778,440 and $40,837,634, respectively, and includes non-recurring income of $6,972,631 and $3,143,988, respectively.

The increase in investment income for the nine months ended September 30, 2021 compared to the nine months ended September 30, 2020 was primarily due to interest income and driven by our deployment of capital, increased invested balance, prepayments, and end-of-term payments, partially offset by falling market interest rates.

Operating Expenses

Operating expenses for the nine months ended September 30, 2021 and 2020 were $20,215,110 and $13,797,626, respectively.

Operating expenses increased for the nine months ended September 30, 2021 from the nine months ended September 30, 2020 primarily due to an increase in incentive fees, management fees, credit facility fees, and interest expense due to an increase in leverage utilization.

Operating expenses per share for the nine months ended September 30, 2021 and 2020 were $0.62 per share and $0.52 per share, respectively.

Incentive Fees

Incentive fees for the nine months ended September 30, 2021 and 2020 were $6,498,482 and $4,871,906, respectively, incurred primarily due to net investment income.

Incentive fees increased for the nine months ended September 30, 2021 from the nine months ended September 30, 2020 primarily due to an increase in net investment income arising from prepayments.

$5,140,115 of the incentive fees for the nine months ended September 30, 2021 were earned, payable in cash, and included under Accrued incentive fees on the Statement of Assets and Liabilities as of September 30, 2021.

$1,358,367 of the incentive fees for the nine months ended September 30, 2021 were deferred and accrued, and included in Accrued incentive fees on the Statement of Assets and Liabilities as of September 30, 2021.

$3,659,134 of the incentive fees for the nine months ended September 30, 2020 were earned, payable in cash, and included under Accrued incentive fees on the Statement of Assets and Liabilities as of September 30, 2020.

$1,212,772 of the incentive fees for the nine months ended September 30, 2020 were deferred and accrued, and included under Accrued incentive fees on the Statement of Assets and Liabilities as of September 30, 2020.

Incentive fees related to PIK or deferred interest are accrued and payment is deferred until such interest is collected in cash.

Incentive fees per share for the nine months ended September 30, 2021 and September 30, 2020 were $0.20 and $0.18 per share, respectively.

Net Investment Income

Net investment income for the nine months ended September 30, 2021 and 2020 was $33,563,330 and $27,040,008, respectively.

Net investment income increased for the nine months ended September 30, 2021 from the nine months ended September 30, 2020, primarily due to an increase in interest income resulting from an increase in the size of the investment portfolio and an increase in prepayments.

Net investment income per share for the nine months ended September 30, 2021 and 2020 was $1.04 per share and $1.02 per share, respectively.

Net Realized (Loss) on Investments

The net realized loss on investments of $4,076,766 for the nine months ended September 30, 2021 was primarily due to the loss on a portion of our investment in the preferred stock of CareCloud, Inc.

The net realized loss on investments of $5,370,702 for the nine months ended September 30, 2020 was primarily due to the loss on our senior secured loan to Aginity, Inc.

The net realized loss on investments of $371,262 for the three months ended March 31, 2022 was primarily due to the loss on a portion of our investment in the preferred stock and warrants of CareCloud, Inc.

partially offset by the gain on our investment in the warrants of CrossRoads Extremity Systems, LLC.

The net realized loss on investments of $199,223 for the three months ended March 31, 2021 was primarily due to the loss on our investment in the warrants for preferred stock of Pivot3 Holdings, Inc.

Net Change in Unrealized Appreciation (Depreciation) on Investments

Net change in unrealized depreciation on investments of $3,172,841 for the nine months ended September 30, 2021 was primarily due to decreases in the fair value of our senior secured loans to Pivot3 Holdings, Inc.

and our investment in the preferred stock of Pivot3 Holdings, Inc.

This was partially offset by an increase in the fair value of our investment in the common stock of Ouster, Inc.

and Brilliant Earth LLC.

The net change in unrealized appreciation on investments of $4,561,255 for the nine months ended September 30, 2020 was primarily due to increases in the fair value of our investments in the warrants of MTBC, Inc.

This was partially offset by decreases in the fair value of our senior secured loan to Pivot3, Inc.

and our investment in the preferred stock of MTBC, Inc.

Net change in unrealized depreciation on investments of $9,235,540 for the three months ended March 31, 2022 was primarily due to decreases in the fair value of our common stock in Brilliant Earth Group, Inc.

and preferred stock in CareCloud, Inc.

The net change in unrealized depreciation on investments of $1,911,181 for the three months ended March 31, 2021 was primarily due to decreases in the fair value of our investments in the warrants of Aspen Group, Inc.

and CareCloud, Inc.

This was partially offset by increases in the fair value of our senior secured loans to Mojix, Inc.

and our investment in the preferred stock of CareCloud, Inc.

Net Increase in Net Assets Resulting from Operations

We had a net increase in net assets resulting from operations of $26,313,723 for the nine months ended September 30, 2021, as compared to a net increase in net assets resulting from operations of $26,230,561 for the nine months ended September 30, 2020.

The net increase in net assets resulting from operations for the nine months ended September 30, 2021 from the nine months ended September 30, 2020 was primarily due to an increase in interest income resulting from an increase in the size of the investment portfolio and an increase in prepayments.

We had a net increase in net assets resulting from operations of $2,853,091 for the three months ended March 31, 2022, as compared to a net increase in net assets resulting from operations of $9,371,328 for the three months ended March 31, 2021.

The net decrease in net assets resulting from operations for the three months ended March 31, 2022 from the three months ended March 31, 2021 was primarily due to an increase in unrealized depreciation in our portfolio and an increase in operating expenses for the three months ended March 31, 2022.

Financial Condition, Liquidity and Capital Resources

We generate cash primarily from the net proceeds of the offering of our securities and cash flows from our operations, including investment sales and repayments as well as income earned on investments and cash equivalents.

We may also fund a portion of our investments through borrowings under the Credit Facilities (discussed below).

We may also fund a portion of our investments through borrowings under the Credit Agreement (discussed below).

We expect that we may also generate cash from any financing arrangements we may enter into in the future and any future offerings of our equity or debt securities.

1 unchanged sentence

Our primary use of funds is to make investments in eligible portfolio companies, pay our operating expenses and make distributions to holders of our common stock.

During the nine months ended September 30, 2021, cash and cash equivalents decreased to $936,503 from $14,886,246 as of December 31, 2020.

This decrease was primarily the result of the purchase of investments in portfolio companies for $237,031,073 and U.S.

Treasury Bills for $115,000,509 and was partially offset by the sales of investments in portfolio companies, the maturity of U.S.

Treasuary Bills, the issuance of common stock, and net borrowings under the Credit Agreement.

During the three months ended March 31, 2022, cash and cash equivalents decreased to $3,510,311 from $4,696,693 as of December 31, 2021.

This decrease was primarily the result of the purchase of investments in portfolio companies and was partially offset by the repayment of an investment in a portfolio company, proceeds from our 2026 Senior Notes, and net borrowings under the Credit Agreement.

Equity Activity

2 unchanged sentences

David Spreng, our President, Chief Executive Officer and Chairman of our Board of Directors, for an aggregate purchase price of $25,000.

Additionally, as of September 31, 2021, we have

issued 22,564 shares of our common stock to Runway Growth Holdings LLC, an affiliate of RGC.

The remaining shares issued as of September 30, 2021 were issued in connection with our private offerings, or pursuant to our dividend reinvestment plan, as follows:

The remaining shares were issued in connection with the Initial Private Offering, the Second Private Offering, pursuant to the dividend reinvestment plan or the IPO as follows:

Issuance Date

Gross Proceeds

December 22, 2016

27 unchanged sentences

September 29, 2021

October 25, 2021

Shares were issued as part of the dividend reinvestment plan.

For more information, see “Recent Developments.”

Stock Repurchase Plans

On February 24, 2022, the Board of Directors approved the Repurchase Program under which the Company may repurchase up to $25 million of its outstanding common stock .

Under the Repurchase Program, purchases may be made at management’s discretion from time to time in open-market transactions, in accordance with all applicable securities laws and regulations.

Unless extended by the Board of Directors, the repurchase program will terminate 12-months from the date it was approved.

The following table provides information regarding our repurchases of our common stock pursuant to the Repurchase Program for three months ended March 31, 2022.

Dollar Value of

Shares That Have

Shares That May

Been Purchased

Yet Be Purchased

Under the Plan

Quarter ended March 31, 2022

Contractual Obligations

At September 30, 2021, the Company had $165,345,185 in unfunded loan commitments to provide debt financing to twelve portfolio companies.

The Company’s management believes that its available cash balances, availability under the Credit Agreement (as

defined below) and/or ability to drawdown capital from investors provides sufficient funds to cover its unfunded commitments as of September 30, 2021.

At March 31, 2022, the Company had $230,984,615 in unfunded loan commitments to provide debt financing to 14 portfolio companies.

The Company’s management believes that its available cash balances, availability under the Credit Agreement, provides sufficient funds to cover its unfunded commitments as of March 31, 2022.

Payments Due By Period

Reverse repurchase agreement (1)

Credit facilities (1)

(1) Reverse repurchase agreement relates to the purchase of the U.S.

Treasury Bill on margin.

The reverse repurchase agreement purchased was subsequently repaid in October 2021.

(2) See “Note 10 – Credit Facilities” to our financial statements in Part I, Item 1 of this Form 10-Q for more information.

Credit Agreement

On May 31, 2019, we entered into a Credit Agreement, as subsequently amended (the “Credit Agreement”) by and among us, as borrower, KeyBank National Association, as administrative agent, syndication agent, and a lender, CIBC Bank USA (“CIBC”), as documentation agent and a lender, and U.S.

2026 Senior Notes (1)

(1) See “Note 10 – Borrowings” to our financial statements in Part I, Item 1 of this Form 10-Q for more information.

On December 10, 2021, we entered into a Note Purchase Agreement governing the issuance of $70,000,000 in aggregate principal amount of 2026 Senior Notes to institutional accredited investors (as defined in Regulation D under the Securities Act) in a private placement.

The 2026 Senior Notes were issued in two closings.

The initial issuance of $20 million 2026 Senior Notes closed on December 10, 2021 and the second and final issuance of $50 million closed on February 10, 2022.

The 2026 Senior Notes bear an interest rate of 4.25% per year and are due on December 10, 2026, unless redeemed, purchased or prepaid prior to such date by us or our affiliates in accordance with their terms.

Interest on the 2026 Senior Notes will be due semiannually.

The interest rate is subject to a 1.00% increase in the event that, subject to certain exceptions, the 2026 Senior Notes cease to have an investment grade rating or receive an investment grade rating below the Investment Grade (as defined in the Note Purchase Agreement).

The 2026 Senior Notes are general unsecured obligations of the Company that rank pari passu with all outstanding and future unsecured unsubordinated indebtedness issued by us.

Aggregate offering costs in connection with the 2026 Senior Notes issuance, including the underwriter’s discount and commissions, were $899,277 which were capitalized and deferred.

As of March 31, 2022 and December 31, 2021, unamortized deferred debt costs related to the 2026 Senior Notes were $860,614 and $376,029, respectively.

See “Note 10—Borrowings” to our financial satements in Part I of this Form 10-Q for more information on the 2026 Senior Notes.

On May 31, 2019, we entered into the Credit Agreement by and among us, as borrower, KeyBank National Association, as administrative agent, syndication agent, and a lender, CIBC, as documentation agent and a lender, and U.S.

Bank National Association, as paying agent.

2 unchanged sentences

Borrowings under the Credit Agreement bear interest on a per annum basis equal to a three-month adjusted LIBOR rate (with a LIBOR floor of zero), plus an applicable margin rate that varies from 3.00% to 2.50% per annum depending on utilization and other factors.

During the availability period, the applicable margin rate (i) is 3.00% per annum for interest periods during which the average utilization is less than 60% and (ii) varies from 3.00% to 2.50% per annum when the average utilization equals or exceeds 60% (with 3.00% applying when the eligible loans in the collateral consist of 9 or fewer unaffiliated obligors, 2.75% applying when the eligible loans consist of between 10 and 29 unaffiliated obligors, and 2.50% applying when the eligible loans consist of 30 or more unaffiliated obligors).

obligors, 2.75% applying when the eligible loans consist of between 10 and 29 unaffiliated obligors, and 2.50% applying when the eligible loans consist of 30 or more unaffiliated obligors).

During the amortization period, the applicable margin rate will be 3.00%.

11 unchanged sentences

and (iii) amend certain other terms of the Credit Agreement.

See "Note 10 -Credit Facilities"

to our financial statements in Part I of this Form 10 Q for more information on the Credit Agreement and Credit Facilities.

During the third quarter of 2021, we further amended the Fee Letter (the “Second Amended and Restated Fee Letter”) to amend the first payment date of the minimum earnings fee, which will be payable annually starting on May 31, 2022.

See "Note 10—Borrowings"

to our financial statements in Part I of this Form 10 Q for more information on the Credit Agreement.

During the third quarter of 2021, we adopted the Second Amended and Restated Fee Letter to amend the first payment date of the minimum earnings fee, which will be payable annually starting on May 31, 2022.

Under the Second Amended and Restated Fee Letter, we the Company will also pay a supplemental fee on the 15th calendar day of each month beginning August 16, 2021 and ending July 15, 2022 in an aggregate amount equal to $66,367, which is paid pro rata to the lenders listed in Schedule A of the Second Amended and Restated Fee Letter.

During the nine months ended September 30, 2021, we drew down $100,000,000 on the Credit Agreement and repaid $119,000,000, of which $80,000,000 remains outstanding at September 30, 2021.

At September 30, 2021, interest was accruing at a rate of 3.50%.

During the three months ended March 31, 2022, we drew down $86,000,000 on the Credit Agreement and repaid $61,000,000, of which $86,000,000 remains outstanding at March 31, 2022.

We anticipate continued usage of the Credit Agreement as well as other potential debt financing alternatives to fund future portfolio growth.

At March 31, 2022, interest was accruing at a rate of 3.50%.

During the year ended December 31, 2021, we drew down $161,000,000 on the Credit Agreement and repaid $199,000,000 of which $61,000,000 remained outstanding at December 31, 2021.

At December 31, 2021, interest was accruing at a rate of 3.50%.

See “Note 10 – Credit Facilities” to our financial statements in Part I, Item 1 of this Form 10-Q for more information on the Credit Agreement and Credit Facilities.

See “Note 10– Borrowings” to our financial statements in Part I, Item 1 of this Form 10-Q for more information on the Credit Agreement.

For more information regarding the Credit Agreement, see “Recent Developments.”

Off-Balance Sheet Arrangements

7 unchanged sentences

As a result, if we declare a distribution, then stockholders’ cash distributions will be automatically reinvested in additional shares of our common stock, unless they specifically “opt out” of the dividend reinvestment plan so as to receive cash distributions.

Prior to our IPO, the number of shares to be issued to a shareholder under the dividend reinvestment plan was determined by dividing the total dollar amount of the distribution payable to such shareholder by the net asset value per share of our common stock, as of the valuation date fixed by the Board of Directors for such dividend.

In connection with our IPO, we entered into our amended and restated dividend reinvestment plan, pursuant to which, if newly issued shares are used to implement the dividend reinvestment plan, the number of shares to be issued to a shareholder will be determined by dividing the total dollar amount of the cash dividend or distribution payable to a shareholder by the market price per share of our common stock at the close of regular trading on the Nasdaq Global Select Market on the payment date of a distribution, or if no sale is reported for such day, the average of the reported bid and ask prices.

If newly issued shares are used to implement the dividend reinvestment plan, the number of shares to be issued to a shareholder will be determined by dividing the total dollar amount of the cash dividend or distribution payable to a shareholder by the market price per share of our common stock at the close of regular trading on the Nasdaq Global Select Market on the payment date of a distribution, or if no sale is reported for such day, the average of the reported bid and ask prices.

However, if the market price per share on the payment date of a cash dividend or distribution exceeds the most recently computed net asset value per share, we will issue shares at the greater of (i) the most recently computed net asset value per share and (ii) 95% of the current market price per share (or such lesser discount to the current market price per share that still exceeded the most recently computed net asset value per share).

1 unchanged sentence

The number of shares to be issued to a participant in the dividend reinvestment plan are rounded downward to the nearest whole number to avoid the issuance of fractional shares, and any fractional share otherwise issuable to a participant but for this provision is instead be paid to such participant in cash contemporaneously with the issuance of such shares in connection with such cash dividend.

During the nine months ended September 30, 2021, we declared dividends in the amount of $34,597,684, of which $7,602,878 was distributed in cash and the remainder distributed in shares to stockholders pursuant to our dividend reinvestment plan.

During the year ended December 31, 2020, we declared and paid dividends in the amount of $39,709,233, of which $7,265,784 was distributed in cash and the remainder distributed in shares to stockholders pursuant to our dividend reinvestment program.

During the three months ended March 31, 2022, we declared and paid dividends in the amount of $11,172,667, of which $3,753,085 was distributed in cash and the remainder distributed in shares to stockholders pursuant to the Company’s dividend reinvestment plan.

During the year ended December 31, 2021, we declared and paid dividends in the amount of $44,942,937, of which $17,948,126 was distributed in cash and the remainder distributed in shares to stockholders pursuant to our dividend reinvestment plan.

The timing and amount of our distributions, if any, will be determined by our Board of Directors and will be declared out of assets legally available for distribution.

The following table shows the dividends per share declared since our formation through September 30, 2021.

The following table shows the dividends per share declared since our formation through March 31, 2022.

Date Declared

35 unchanged sentences

August 12, 2021

October 28, 2021

November 8, 2021

November 22, 2021

February 24, 2022

March 8, 2022

March 22, 2022

Critical Accounting Policies

3 unchanged sentences

Actual results could materially differ from those estimates.

We believe that our most critical accounting policies, which are those that are most important to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective and complex judgments, include the valuation of investments and our election to be treated, and intent to qualify annually, as a RIC.

We believe that our most critical accounting policies, which are those that are most important to the portrayal of our

financial condition and results of operations and require management’s most difficult, subjective and complex judgments, include the valuation of investments and our election to be treated, and intent to qualify annually, as a RIC.

See “Note 2 — Summary of Significant Accounting Policies” to our financial statements in Part I, Item 1 of this Form 10-Q, which describes our critical accounting policies and recently adopted accounting pronouncements not yet required to be adopted by us.

23 unchanged sentences

The principal market for any asset is the market with the greatest volume and level of activity for such asset in which the reporting entity would or could sell or transfer the asset.

In determining the principal market for an asset or liability under ASC Topic 820, it is assumed that the reporting entity has access to such market as of the measurement date.

In determining the principal market for an asset or

liability under ASC Topic 820, it is assumed that the reporting entity has access to such market as of the measurement date.

Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable and willing and able to transact.

8 unchanged sentences

These investments are considered Level 3 assets under ASC Topic 820 because there is no known or accessible market or market indices for these types of debt instruments and, thus, RGC’s senior investment team must estimate the fair value of these investment securities based on models utilizing unobservable inputs.

Rule 2a-5 under the 1940 Act was adopted by the SEC in December 2020 and establishes requirements for determining fair value in good faith for purposes of the 1940 Act.

Rule 2a-5 under the 1940 Act was adopted by the SEC in December 2020 and establishes a framework for determining fair value in good faith for purposes of the 1940 Act.

The Company is evaluating the impact of adopting Rule 2a-5 on the financial statements and intends to comply with the new rule’s requirements on or before the compliance date in September 2022.

10 unchanged sentences

however, a significantly higher or lower fair value measurement of any of the Company’s portfolio investments may occur regardless of whether there is a signficiant increase or decrease in these unobservable inputs.

Under certain circumstances, we may use an alternative technique to value the debt investments to be acquired by us that better reflects the fair value of the investment, such as the price paid or realized in a recently completed transaction or a binding offer received in an arms-length transaction, the use of multiple probability-weighted cash flow models when the expected future cash flows contain elements of variability or estimates of proceeds that would be received in a liquidation scenario.

in an arms-length transaction, the use of multiple probability-weighted cash flow models when the expected future cash flows contain elements of variability or estimates of proceeds that would be received in a liquidation scenario.

Fair value of warrants is primarily determined using a Black Scholes option-pricing model.

36 unchanged sentences

In some cases, the fair value of such investments is best expressed as a range of values derived utilizing different methodologies from which a fair value may then be determined.

The Company’s assets measured at fair value on a recurring basis subject to the requirements of ASC Topic 820 at September 30, 2021 and December 31, 2020 were as follows:

As of September 30, 2021 (Unaudited)

The Company’s assets measured at fair value on a recurring basis subject to the requirements of ASC Topic 820 at March 31, 2022 and December 31, 2021 were as follows:

As of March 31, 2022 (Unaudited)

Portfolio Investments

Corporate Bonds

Senior Secured Term Loans

Second Lien Term Loans

Preferred Stock

Total Portfolio Investments

Treasury Bill

Total Investments

15 unchanged sentences

OID, principally representing the estimated fair value of detachable equity or warrants obtained in conjunction with our debt investments, loan origination fees, end of term payments, and market discount or premium are capitalized and accreted or amortized into interest income over the life of the respective security using the effective interest method.

Loan origination fees received in connection with the closing of investments are reported as unearned income, which is included as amortized cost of the investment;

Loan origination fees received in connection with the closing of

investments are reported as unearned income, which is included as amortized cost of the investment;

the unearned income from such fees is accreted over the contractual life of the loan based on the effective interest method.

13 unchanged sentences

Recent Developments

We evaluated events subsequent to September 30, 2021 through November 4, 2021.

On October 18, 2021, Credit Sesame, Inc.

prepaid its outstanding principal balance of $41,047,728.

In addition, we received cash proceeds of $2,140,678 in conjunction with ETP, prepayment fees, and interest for total proceeds of $43,188,406.

On October 19, 2021, we entered into an amendment to the Credit Agreement to make certain immaterial clarifications to the terms of the Credit Agreement.

On October 25, 2021, we closed our IPO, issuing 6,850,000 shares of our common stock at a public offering price of $14.60 per share.

Net of underwriting fees, we received total net cash proceeds of $94.0 million, before expenses.

We have granted the underwriters an option to purchase up to an additional 1,027,500 shares of common stock from, at the public offering price, less the sales load payable by us, on or before November 19, 2021.

Our common stock began trading on the Nasdaq Global Select Market under the symbol “RWAY” on October 21, 2021.

In connection with IPO, the Board approved an amended and restated dividend reinvestment plan (the “New DRIP”) which became effective on October 25, 2021, concurrent with the IPO.

Pursuant to the New DRIP, among other changes, with respect to each cash dividend or distribution, the Board reserves the right to either issue new shares of common stock or purchase shares of common stock in the open market for the accounts of Participants (as defined in the New DRIP).

If newly issued shares are used to implement the New DRIP, the number of shares to be issued to a shareholder will be determined by dividing the total dollar amount of the distribution payable to such Participant by the market price per share of our common stock at the close of regular trading of the Nasdaq Global Select Market on the Payment Date (as defined in the New DRIP), or if no sale is reported for such day, the average of the reported bid and asked prices.

However, if the market price per share on the Payment Date exceeds the most recently computed net asset value per share, we will issue shares at the greater of (i) the most recently computed net asset value per share and (ii) 95% of the current market price per share (or such lesser discount to the current market price per share that still exceeds the most recently computed net asset value per share).

If shares are purchased in the open market to implement the New DRIP, the number of shares to be issued to a Participant shall be determined by dividing the dollar amount of the distribution payable to such Participant by the weighted average price per share for all shares of common stock purchased by the plan administrator in the open market in connection with the dividend or distribution.

On October 26, 2021, we funded an investment of $8,775,000 to Marley Spoon AG.

On October 28, 2021, we declared a dividend of $0.25 per share payable on November 22, 2021 to shareholders of record as of November 8, 2021.

We evaluated events subsequent to March 31, 2022 through May 5, 2022.

On April 20, 2022, we entered into a certain amended and restated credit agreement (the “Amended and Restated Credit Agreement”) among us, as borrower, the financial institutions party thereto as lenders (the “Lenders”), KeyBank National Association, as administrative agent for Lenders (“Administrative Agent”) and a Lender, CIBC Bank USA, as documentation agent and a Lender, MUFG Union Bank, N.A.

as co-documentation agent, and U.S.

Bank Trust Company, National Association, as collateral custodian and paying agent.

Effective as of April 20, 2022, the Amended and Restated Credit Agreement amended and restated that certain Credit Agreement, dated as of May 31, 2019, among us, as borrower, the financial institutions party thereto as lenders, KeyBank National Association, as administrative agent and a lender, CIBC Bank USA, as documentation agent and a lender, MUFG Union Bank, N.A.

as co-documentation agent, and U.S.

Bank, National Association, as collateral custodian and paying agent (as amended prior to April 20, 2022, the “Prior Credit Agreement”).

The Amended and Restated Credit Agreement amended and restated the Prior Credit Agreement to:

(i) increase the commitment amount from $215 million to $225 million, (ii) increase the accordion amount from a $350 million maximum aggregate commitment amount to a $500 million maximum aggregate commitment amount;

(iii) extend the maturity date and revolving period, (iv) calculate the interest rate based on SOFR (rather than LIBOR), and (v) amend certain other terms of the Prior Credit Agreement, including without limitation the borrowing base calculation and excess concentration measures.

On April 28, 2022, we declared a dividend of $0.30 per share payable on May 24, 2022 to shareholders of record as of May 10, 2022.

On March 2, 2022, Coginiti Corp prepaid its outstanding principal balance of $500,000 along with outstanding interest for total consideration of $509,276.

On March 3, 2022, we funded an investment of $5,000,000 to INRIX, Inc.

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 2. Management’s Discussion and Analysis