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Organization, Business, Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended
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Dec. 31, 2023
Accounting Policies [Abstract] |
Organization, Business, Basis of Presentation and Summary of Significant Accounting Policies | Organization, Business, Basis of Presentation and Summary of Significant Accounting Policies Organization and Business Barings BDC, Inc. (the “Company”) and its wholly-owned subsidiaries are specialty finance companies. The Company currently operates as a closed-end, non-diversified investment company and has elected to be treated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”). The Company has elected for federal income tax purposes to be treated as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). The Asset Sale and Externalization Transactions On April 3, 2018, the Company entered into an asset purchase agreement (the “Asset Purchase Agreement”) with BSP Asset Acquisition I, LLC (the “Asset Buyer”), an affiliate of Benefit Street Partners L.L.C., pursuant to which the Company agreed to sell its December 31, 2017 investment portfolio to the Asset Buyer for gross proceeds of $981.2 million in cash, subject to certain adjustments to take into account portfolio activity and other matters occurring since December 31, 2017 (such transaction referred to herein as the “Asset Sale Transaction”). Also on April 3, 2018, the Company entered into a stock purchase and transaction agreement (the “Externalization Agreement”) with Barings LLC (“Barings” or the “Adviser”), through which Barings agreed to become the investment adviser to the Company in exchange for (1) a payment by Barings of $85.0 million directly to the Company’s stockholders, (2) an investment by Barings of $100.0 million in newly issued shares of the Company’s common stock at net asset value (“NAV”) and (3) a commitment from Barings to purchase up to $50.0 million of shares of the Company’s common stock in the open market at prices up to and including the Company’s then-current NAV per share for a two-year period, after which Barings agreed to use any remaining funds from the $50.0 million to purchase additional newly issued shares of the Company’s common stock at the greater of the Company’s then-current NAV per share and market price (collectively, the “Externalization Transaction”). The Asset Sale Transaction and the Externalization Transaction are collectively referred to as the “Transactions.” The Transactions were approved by the Company’s stockholders at the Company’s July 24, 2018 special meeting of stockholders. The Externalization Transaction closed on August 2, 2018 (the “Externalization Closing”). Effective as of the Externalization Closing, the Company changed its name from Triangle Capital Corporation to Barings BDC, Inc. and on August 3, 2018 began trading on the New York Stock Exchange (“NYSE”) under the symbol “BBDC.” In connection with the Externalization Closing, the following events occurred, among others: •On August 2, 2018, the Company entered into an investment advisory agreement (the “Original Advisory Agreement”) and an administration agreement (the “Administration Agreement”) with the Adviser pursuant to which the Adviser serves as the Company’s investment adviser and administrator and manages its investment portfolio which initially consisted primarily of the cash proceeds received in connection with the Asset Sale Transaction. •On August 2, 2018, the Company issued 8,529,917 shares of the Company’s common stock to the Adviser at a price of $11.723443 per share, or an aggregate of $100.0 million in cash, in a private transaction exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”) and/or Rule 506 of Regulation D thereunder. Organization The Company is a Maryland corporation incorporated on October 10, 2006. Prior to the Externalization Transaction, the Company was internally managed by its executive officers under the supervision of the Board. During this period, the Company did not pay management or advisory fees, but instead incurred the operating costs associated with employing executive management and investment and portfolio management professionals. On August 2, 2018, the Company entered into the Original Advisory Agreement and became an externally-managed BDC managed by the Adviser. An externally-managed BDC generally does not have any employees, and its investment and management functions are provided by an outside investment adviser and administrator under an investment advisory agreement and administration agreement. Instead of the Company directly compensating employees, the Company pays the Adviser for investment and management services pursuant to the terms of the New Barings BDC Advisory Agreement (as defined in “Note 2 - Agreements and Related Party Transactions”) and reimburses Barings, in its role as the Company’s administrator, for its provision of administrative services to the Company pursuant to the Administration Agreement. See “Note 2 - Agreements and Related Party Transactions” for additional information regarding the Company’s investment advisory agreement and administration agreement. Basis of Presentation The financial statements of the Company include the accounts of Barings BDC, Inc. and its wholly-owned subsidiaries. The effects of all intercompany transactions between the Company and its wholly-owned subsidiaries have been eliminated in consolidation. The Company is an investment company and, therefore, applies the specialized accounting and reporting guidance in Accounting Standards Codification (“ASC”) Topic 946, Financial Services – Investment Companies. ASC Topic 946 states that consolidation by the Company of an investee that is not an investment company is not appropriate, except when the Company holds a controlling interest in an operating company that provides all or substantially all of its services directly to the Company or to its portfolio companies. None of the portfolio investments made by the Company qualify for this exception. Therefore, the Company’s investment portfolio is carried on the Consolidated Balance Sheets at fair value, as discussed below under Significant Accounting Policies - Valuation of Investments, with any adjustments to fair value recognized as “Net unrealized appreciation (depreciation)” on the Consolidated Statements of Operations. The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). All financial data and information included in these financial statements have been presented on the basis described above. Financial statements prepared on a U.S. GAAP basis require management to make estimates and assumptions that affect the amounts and disclosures reported in the Consolidated Financial Statements and accompanying notes. Such estimates and assumptions could change in the future as more information becomes known, which could impact the amounts reported and disclosed herein. Recently Issued Accounting Standards In June 2022, the FASB issued Accounting Standards Update, 2022-03, Fair Value Measurement (Topic 820) (“ASU 2022-03”), which affects all entities that have investments in equity securities measured at fair value that are subject to a contractual sale restriction. The amendments in ASU 2022-03 clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring the fair value. The amendments also require additional disclosures for equity securities subject to contractual sale restrictions that are measured at fair value in accordance with Topic 820. The effective date for the amendments in ASU 2022-03 are for fiscal years beginning after December 15, 2023 and interim periods within those fiscal years. The Company is currently evaluating the impact of the adoption of ASU 2022-03 on its financial statements. In March 2020, the FASB issued Accounting Standards Update, 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). The amendments in ASU 2020-04 provide optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. ASU 2020-04 was effective for all entities as of March 12, 2020 through December 31, 2022. In December 2022, the FASB issued Accounting Standards Update 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848, which deferred the sunset day of this guidance to December 31, 2024. The Company determined this guidance will not have a material impact on its consolidated financial statements. Share Repurchase Programs In connection with the completion of the Company’s acquisition of MVC Capital, Inc. (“MVC”), a Delaware corporation, on December 23, 2020 (the “MVC Acquisition”), the Company committed to make open-market purchases of shares of its common stock in an aggregate amount of up to $15.0 million at then-current market prices at any time shares trade below 90% of the Company’s then most recently disclosed NAV per share. Any repurchases pursuant to the authorized program occurred during the 12-month period commencing upon the filing of the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2021, which occurred on May 6, 2021, and were made in accordance with applicable legal, contractual and regulatory requirements. The MVC repurchase program terminated on May 6, 2022. Prior to its termination, the Company repurchased a total of 207,677 shares of common stock in the open market under the under the authorized program at an average price of $10.14 per share, including brokerage commissions. In connection with the completion of the Company’s acquisition of Sierra Income Corporation (“Sierra”), a Maryland corporation, on February 25, 2022 (the “Sierra Merger”), the Company committed to make open-market purchases of shares of its common stock in an aggregate amount of up to $30.0 million at then-current market prices at any time shares trade below 90% of the Company’s then most recently disclosed NAV per share. Any repurchases pursuant to the authorized program occurred during the 12-month period commencing on April 1, 2022 and were made in accordance with a Rule 10b5-1 purchase plan that qualifies for the safe harbors provided by Rules 10b5-1 and 10b-18 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as well as subject to compliance with the Company’s covenant and regulatory requirements. During the year ended December 31, 2022, the Company repurchased the maximum amount of $30.0 million of common stock authorized under the Sierra share repurchase program. In total under the Sierra share repurchase program, the Company repurchased a total of 3,179,168 shares of common stock in the open market under the authorized program at an average price of $9.44 per share, including broker commissions. On February 23, 2023, the Board authorized a 12-month share repurchase program. Under the program, the Company may repurchase, during the 12-month period commencing on March 1, 2023, up to $30.0 million in the aggregate of its outstanding common stock in the open market at prices below the then-current NAV per share. The timing, manner, price and amount of any share repurchases will be determined by the Company, in its discretion, based upon the evaluation of economic and market conditions, the Company’s stock price, applicable legal, contractual and regulatory requirements and other factors. The program is expected to be in effect until March 1, 2024, unless extended or until the aggregate repurchase amount that has been approved by the Board has been expended. The program does not require the Company to repurchase any specific number of shares, and the Company cannot assure stockholders that any shares will be repurchased under the program. The program may be suspended, extended, modified or discontinued at any time. During the year ended December 31, 2023, the Company repurchased a total of 1,849,096 shares of common stock in the open market under the authorized program at an average price of $7.99 per share, including brokerage commissions. See “Note 12 - Subsequent Events.” Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Valuation of Investments The Adviser conducts the valuation of the Company’s investments, upon which the Company’s NAV is primarily based, in accordance with its valuation policy, as well as established and documented processes and methodologies for determining the fair values of portfolio company investments on a recurring (at least quarterly) basis in accordance with the 1940 Act and FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC Topic 820”). The Company’s current valuation policy and processes were established by the Adviser and were approved by the Board. Under ASC Topic 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between a willing buyer and a willing seller at the measurement date. For the Company’s portfolio securities, fair value is generally the amount that the Company might reasonably expect to receive upon the current sale of the security. The fair value measurement assumes that the sale occurs in the principal market for the security, or in the absence of a principal market, in the most advantageous market for the security. If no market for the security exists or if the Company does not have access to the principal market, the security should be valued based on the sale occurring in a hypothetical market. Under ASC Topic 820, there are three levels of valuation inputs, as follows: Level 1 Inputs – include quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 Inputs – include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3 Inputs – include inputs that are unobservable and significant to the fair value measurement. A financial instrument is categorized within the ASC Topic 820 valuation hierarchy based upon the lowest level of input to the valuation process that is significant to the fair value measurement. For example, a Level 3 fair value measurement may include inputs that are observable (Levels 1 and 2) and unobservable (Level 3). Therefore, unrealized appreciation and depreciation related to such investments categorized as Level 3 investments within the tables below may include changes in fair value that are attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3). The Company’s investment portfolio includes certain debt and equity instruments of privately held companies for which quoted prices or other observable inputs falling within the categories of Level 1 and Level 2 are generally not available. In such cases, the Adviser determines the fair value of the Company’s investments in good faith primarily using Level 3 inputs. In certain cases, quoted prices or other observable inputs exist, and if so, the Adviser assesses the appropriateness of the use of these third-party quotes in determining fair value based on (i) its understanding of the level of actual transactions used by the broker to develop the quote and whether the quote was an indicative price or binding offer and (ii) the depth and consistency of broker quotes and the correlation of changes in broker quotes with the underlying performance of the portfolio company. There is no single approach for determining fair value in good faith, as fair value depends upon the specific circumstances of each individual investment. The recorded fair values of the Company’s Level 3 investments may differ significantly from fair values that would have been used had an active market for the securities existed. In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the valuations currently assigned. For a discussion of the risks inherent in determining the value of securities for which readily available market values do not exist, see “Risk Factors — Risks Relating to Our Business and Structure — Our investment portfolio is and will continue to be recorded at fair value as determined in accordance with the Adviser’s valuation policies and procedures and, as a result, there is and will continue to be uncertainty as to the value of our portfolio investments” included in Item 1A of Part I of this Annual Report on Form 10-K. Investment Valuation Process The Board must determine fair value in good faith for any or all Company investments for which market quotations are not readily available. The Board has designated the Adviser as valuation designee to perform the fair value determinations relating to the value of the assets held by the Company for which market quotations are not readily available. The Adviser has established a pricing committee that is, subject to the oversight of the Board, responsible for the approval, implementation and oversight of the processes and methodologies that relate to the pricing and valuation of assets held by the Company. The Adviser uses independent third-party providers to price the portfolio, but in the event an acceptable price cannot be obtained from an approved external source, the Adviser will utilize alternative methods in accordance with internal pricing procedures established by the Adviser’s pricing committee. At least annually, the Adviser conducts reviews of the primary pricing vendors to validate that the inputs used in the vendors’ pricing process are deemed to be market observable. While the Adviser is not provided access to proprietary models of the vendors, the reviews have included on-site walkthroughs of the pricing process, methodologies and control procedures for each asset class and level for which prices are provided. The review also includes an examination of the underlying inputs and assumptions for a sample of individual securities across asset classes, credit rating levels and various durations, a process the Adviser continues to perform annually. In addition, the pricing vendors have an established challenge process in place for all security valuations, which facilitates identification and resolution of prices that fall outside expected ranges. The Adviser believes that the prices received from the pricing vendors are representative of prices that would be received to sell the assets at the measurement date (i.e. exit prices). The Company’s money market fund investments are generally valued using Level 1 inputs and its equity investments listed on an exchange or on the NASDAQ National Market System are valued using Level 1 inputs, using the last quoted sale price of that day. The Company’s syndicated senior secured loans and structured product investments are generally valued using Level 2 inputs, which are generally valued at the bid quotation obtained from dealers in loans by an independent pricing service. The Company’s middle-market, private debt and equity investments are generally valued using Level 3 inputs. Independent Valuation The fair value of loans and equity investments that are not syndicated or for which market quotations are not readily available, including middle-market loans, are generally submitted to independent providers to perform an independent valuation on those loans and equity investments as of the end of each quarter. Such loans and equity investments are initially held at cost, as that is a reasonable approximation of fair value on the acquisition date, and monitored for material changes that could affect the valuation (for example, changes in interest rates or the credit quality of the borrower). At the quarter end following that of the initial acquisition, such loans and equity investments are generally sent to a valuation provider which will determine the fair value of each investment. The independent valuation providers apply various methods (synthetic rating analysis, discounting cash flows, and re-underwriting analysis) to establish the rate of return a market participant would require (the “discount rate”) as of the valuation date, given market conditions, prevailing lending standards and the perceived credit quality of the issuer. Future expected cash flows for each investment are discounted back to present value using these discount rates in the discounted cash flow analysis. A range of values will be provided by the valuation provider and the Adviser will determine the point within that range that it will use. If the Adviser’s pricing committee disagrees with the price range provided, it may make a fair value recommendation to the Adviser that is outside of the range provided by the independent valuation provider and the reasons therefore. In certain instances, the Company may determine that it is not cost-effective, and as a result is not in the stockholders’ best interests, to request an independent valuation firm to perform an independent valuation on certain investments. Such instances include, but are not limited to, situations where the fair value of the investment in the portfolio company is determined to be insignificant relative to the total investment portfolio. Valuation Inputs The Adviser’s valuation techniques are based upon both observable and unobservable pricing inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Adviser’s market assumptions. The Adviser’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument. An independent pricing service provider is the preferred source of pricing a loan, however, to the extent the independent pricing service provider price is unavailable or not relevant and reliable, the Adviser will utilize alternative approaches such as broker quotes or manual prices. The Adviser attempts to maximize the use of observable inputs and minimize the use of unobservable inputs. The availability of observable inputs can vary from investment to investment and is affected by a wide variety of factors, including the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets and other characteristics particular to the security. Valuation of Investments in Jocassee, Thompson Rivers, Waccamaw River, Sierra JV and MVC Private Equity Fund LP As Jocassee, Thompson Rivers, Waccamaw River, Sierra JV and MVC Private Equity Fund LP are investment companies with no readily determinable fair values, the Adviser estimates the fair value of the Company’s investments in these entities using the NAV of each company and the Company’s ownership percentage as a practical expedient. The NAV is determined in accordance with the specialized accounting guidance for investment companies. Level 3 Unobservable Inputs The following tables summarize the significant unobservable inputs the Adviser used in the valuation of the Company’s Level 3 debt and equity securities as of December 31, 2023 and 2022. The weighted average range of unobservable inputs is based on fair value of investments.
December 31, 2023: ($ in thousands) | Fair Value |  | Valuation Model |  | Level 3 Input |  | Range of Inputs |  | Weighted Average |  | Impact to Valuation from an Increase in Input
Senior debt and 1 st lien notes(1) | $ | 1,399,907 |  |  | Yield Analysis |  | Market Yield |  | 7.8% – 19.6% |  | 11.7% |  | Decrease
32,150 |  |  | Market Approach |  | Adjusted EBITDA Multiple |  | 1.1x – 12.5x |  | 3.7x |  | Increase
136,594 |  |  | Recent Transaction |  | Transaction Price |  | 95.0% – 100.0% |  | 97.9% |  | Increase
Subordinated debt and 2 nd lien notes(2) | 167,250 |  |  | Yield Analysis |  | Market Yield |  | 8.5% – 18.9% |  | 13.5% |  | Decrease
39,826 |  |  | Market Approach |  | Adjusted EBITDA Multiple |  | 7.0x – 12.3x |  | 8.2x |  | Increase
5,875 |  |  | Recent Transaction |  | Transaction Price |  | 98.0% – 100.0% |  | 99.3% |  | Increase
Structured products(3) | 30,529 |  |  | Yield Analysis |  | Market Yield |  | 9.2% – 10.3% |  | 9.7% |  | Decrease
Equity shares(4) | 8,788 |  |  | Yield Analysis |  | Market Yield |  | 14.6% |  | 14.6% |  | Decrease
328,210 |  |  | Market Approach |  | Adjusted EBITDA Multiple |  | 4.5x – 30.0x |  | 10.6x |  | Increase
1,771 |  |  | Market Approach |  | Revenue Multiple |  | 6.5x – 9.5x |  | 6.9x |  | Increase
12,159 |  |  | Discounted Cash Flow Analysis |  | Discount Rate |  | 14.2% |  | 14.2% |  | Decrease
3,196 |  |  | Net Asset Approach |  | Liabilities |  | $(55,281.8) |  | $(55,281.8) |  | Decrease
3 |  |  | Expected Recovery |  | Expected Recovery |  | $2.5 |  | $2.5 |  | Increase
12,947 |  |  | Recent Transaction |  | Transaction Price |  | $1.00 – $10.00 |  | $9.5 |  | Increase
Equity warrants | 2,389 |  |  | Market Approach |  | Adjusted EBITDA Multiple |  | 6.3x – 12.5x |  | 7.3x |  | Increase
3 |  |  | Expected Recovery |  | Expected Recovery |  | $3.0 |  | $3.0 |  | Increase
(1)Excludes investments with an aggregate fair value amounting to $25,146, which the Company valued using unadjusted prices from independent pricing services and independent indicative broker quotes where pricing inputs are not readily available. (2)Excludes investments with an aggregate fair value amounting to $10,847, which the Company valued using unadjusted prices from independent pricing services and independent indicative broker quotes where pricing inputs are not readily available. (3)Excludes investments with an aggregate fair value amounting to $12,443, which the Company valued using unadjusted prices from independent pricing services and independent indicative broker quotes where pricing inputs are not readily available. (4)Excludes investments with an aggregate fair value amounting to $7,498, which the Company valued using unadjusted prices from independent pricing services and independent indicative broker quotes where pricing inputs are not readily available. During the year ended December 31, 2023, one equity position with a fair value of $5.3 million and six senior debt and first lien note positions with a fair value of $20.0 million transitioned from a yield analysis to a market approach valuation model. In addition, one senior debt and first lien note position with a fair value of $9.9 million and one structured product position with a fair value of $3.3 million transitioned from a discounted cash flow analysis to a broker quote valuation model. Lastly, one equity position with a fair value of nil transitioned from an expected recovery to a market approach valuation model. The changes in approach were driven by considerations given to the financial performance of each portfolio company.
December 31, 2022: ($ in thousands) | Fair Value |  | Valuation Model |  | Level 3 Input |  | Range of Inputs |  | Weighted Average |  | Impact to Valuation from an Increase in Input
Senior debt and 1 st lien notes(1) | $ | 1,305,819 |  |  | Yield Analysis |  | Market Yield |  | 7.7% – 37.3% |  | 11.7% |  | Decrease
14,794 |  |  | Market Approach |  | Adjusted EBITDA Multiple |  | 6.0x |  | 6.0x |  | Increase
1,263 |  |  | Market Approach |  | Revenue Multiple |  | 0.2x |  | 0.2x |  | Increase
13,153 |  |  | Discounted Cash Flow Analysis |  | Discount Rate |  | 13.0% |  | 13.0% |  | Decrease
233,824 |  |  | Recent Transaction |  | Transaction Price |  | 96.7% – 100.0% |  | 97.5% |  | Increase
Subordinated debt and 2 nd lien notes(2) | 182,856 |  |  | Yield Analysis |  | Market Yield |  | 8.4% – 16.6% |  | 13.1% |  | Decrease
35,536 |  |  | Market Approach |  | Adjusted EBITDA Multiple |  | 6.5x – 9.0x |  | 7.4x |  | Increase
2,186 |  |  | Market Approach |  | Revenue Multiple |  | 0.5x |  | 0.5x |  | Increase
513 |  |  | Recent Transaction |  | Transaction Price |  | 97.3% |  | 97.3% |  | Increase
Structured Products(3) | 3,792 |  |  | Discounted Cash Flow Analysis |  | Discount Rate |  | 10.4% |  | 10.4% |  | Decrease
5,239 |  |  | Recent Transaction |  | Transaction Price |  | 100.0% |  | 100.0% |  | Increase
Equity shares(4) | 12,600 |  |  | Yield Analysis |  | Market Yield |  | 15.7% – 17.8% |  | 16.7% |  | Decrease
259,219 |  |  | Market Approach |  | Adjusted EBITDA Multiple |  | 4.0x – 43.0x |  | 9.4x |  | Increase
1,321 |  |  | Market Approach |  | Revenue Multiple |  | 0.2x – 7.0x |  | 6.8x |  | Increase
221 |  |  | Market Approach |  | Adjusted EBITDA/Revenue Multiple Blend |  | 5.8x |  | 5.8x |  | Increase
1,932 |  |  | Net Asset Approach |  | Liabilities |  | $(8,941.8) |  | $(8,941.8) |  | Decrease
112 |  |  | Expected Recovery |  | Expected Recovery |  | $2.5 – $110 |  | $107.6 |  | Increase
4,921 |  |  | Recent Transaction |  | Transaction Price |  | $0.00 – $1,015.13 |  | $521.22 |  | Increase
Equity warrants | 1,054 |  |  | Market Approach |  | Adjusted EBITDA Multiple |  | 4.0x – 17.5x |  | 7.3x |  | Increase
3 |  |  | Expected Recovery |  | Expected Recovery |  | $3.0 |  | $3.0 |  | Increase
(1)Excludes investments with an aggregate fair value amounting to $22,503, which the Adviser valued using unadjusted prices from independent pricing services and independent indicative broker quotes where pricing inputs are not readily available. (2)Excludes investments with an aggregate fair value amounting to $13,123, which the Adviser valued using unadjusted prices from independent pricing services and independent indicative broker quotes where pricing inputs are not readily available. (3)Excludes investments with an aggregate fair value amounting to $8,796, which the Adviser valued using unadjusted prices from independent pricing services and independent indicative broker quotes where pricing inputs are not readily available. (4)Excludes investments with an aggregate fair value amounting to $2,741, which the Adviser valued using unadjusted prices from independent pricing services and independent indicative broker quotes where pricing inputs are not readily available. Unsettled Purchases and Sales of Investments Investment transactions are recorded based on the trade date of the transaction. As a result, unsettled purchases and sales are recorded as payables and receivables from unsettled transactions, respectively. While purchases and sales of the Company’s syndicated senior secured loans generally settle on a T+7 basis, the settlement period will sometimes extend past the scheduled settlement. In such cases, the Company generally is contractually owed and recognizes interest income equal to the applicable margin (“spread”) beginning on the T+7 date. Such income is accrued as interest receivable and is collected upon settlement of the investment transaction. Realized Gain or Loss and Unrealized Appreciation or Depreciation of Portfolio Investments Realized gains or losses are recorded upon the sale or liquidation of investments and are calculated as the difference between the net proceeds from the sale or liquidation, if any, and the cost basis of the investment using the specific identification method. Unrealized appreciation or depreciation reflects the difference between the fair value of the investments and the cost basis of the investments. Investment Classification In accordance with the provisions of the 1940 Act, the Company classifies investments by level of control. As defined in the 1940 Act, “Control Investments” are investments in those companies that the Company is deemed to “Control.” “Affiliate Investments” are investments in those companies that are “Affiliated Persons” of the Company, as defined in the 1940 Act, other than Control Investments. “Non-Control / Non-Affiliate Investments” are those that are neither Control Investments nor Affiliate Investments. Generally, under the 1940 Act, the Company is deemed to control a company in which it has invested if the Company owns more than 25.0% of the voting securities (i.e., securities with the right to elect directors) and/or has the power to exercise control over the management or policies of such portfolio company. Generally, under the 1940 Act, “Affiliate Investments” that are not otherwise “Control Investments” are defined as investments in which the Company owns at least 5.0%, up to 25.0% (inclusive), of the voting securities and does not have the power to exercise control over the management or policies of such portfolio company. Cash and Foreign Currencies Cash consists of deposits held at a custodian bank. Cash is carried at cost, which approximates fair value. The Company places its cash with financial institutions and, at times, cash may exceed insured limits under applicable law. Short-Term Investments Short-term investments represent investments in money market funds. Deferred Financing Fees Costs incurred to issue debt are capitalized and are amortized over the term of the debt agreements using the effective interest method. Investment Income Interest income, including amortization of premium and accretion of discount, is recorded on the accrual basis to the extent that such amounts are expected to be collected. Generally, when interest and/or principal payments on a loan become past due, or if the Company otherwise does not expect the borrower to be able to service its debt and other obligations, the Company 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. The Company writes off any previously accrued and uncollected interest when it is determined that interest is no longer considered collectible. As of December 31, 2023 and December 31, 2022, the Company had four and seven portfolio companies, respectively, with investments that were on non-accrual. As of December 31, 2023, the four portfolio companies on non-accrual included one portfolio company purchased as part of the Sierra Merger, one purchased as part of the MVC Acquisition and two portfolio companies were originated by Barings. As of December 31, 2022, the seven portfolio companies on non-accrual included four portfolio companies purchased as part of the Sierra Merger, two purchased as part of the MVC Acquisition and one portfolio company was originated by Barings. Interest income from investments in the equity class of a collateralized loan obligation (“CLO”) security (typically subordinated notes) is recorded based upon an estimation of an effective yield to expected maturity utilizing assumed cash flows in accordance with ASC 325-40, Beneficial Interests in Securitized Financial Assets. The Company monitors the expected cash flows from these investments, including the expected residual payments, and the effective yield is determined and updated periodically. Any difference between the cash distribution received and the amount calculated pursuant to the effective interest method is recorded as an adjustment to the cost basis of such investments. Dividend income on preferred equity securities is recorded on the accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. Dividend income on common equity is recorded on the ex-dividend date. Payment-in-Kind Interest The Company currently holds, and expects to hold in the future, some loans in its portfolio that contain payment-in-kind (“PIK”) interest provisions. PIK interest, computed at the contractual rate specified in each loan agreement, is periodically added to the principal balance of the loan, rather than being paid to the Company in cash, and is recorded as interest income. Thus, the actual collection of PIK interest may be deferred until the time of debt principal repayment. PIK interest, which is a non-cash source of income at the time of recognition, is included in the Company’s taxable income and therefore affects the amount the Company is required to distribute to its stockholders to maintain its tax treatment as a RIC for federal income tax purposes, even though the Company has not yet collected the cash. Generally, when current cash interest and/or principal payments on a loan become past due, or if the Company otherwise does not expect the borrower to be able to service its debt and other obligations, the Company will place the loan on non-accrual status and will generally cease recognizing PIK 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. The Company writes off any accrued and uncollected PIK interest when it is determined that the PIK interest is no longer collectible. Fee Income Origination, facility, commitment, consent and other advance fees received in connection with loan agreements (“Loan Origination Fees”) are recorded as deferred income and recognized as investment income over the term of the loan. Upon prepayment of a loan, any unamortized Loan Origination Fees are recorded as investment income. In the general course of its business, the Company receives certain fees from portfolio companies, which are non-recurring in nature. Such fees include loan prepayment penalties, structuring fees and covenant waiver fees and amendment fees, and are recorded as investment income when earned. Fee income for the years ended December 31, 2023, 2022 and 2021 was as follows:
| Year Ended December 31
($ in thousands) | 2023 |  | 2022 |  | 2021
Recurring Fee Income: |  |  |  |  |
Amortization of loan origination fees | $ | 6,949 |  |  | $ | 5,943 |  |  | $ | 4,620 |
Management, valuation and other fees | 2,261 |  |  | 1,237 |  |  | 2,186 |
Total Recurring Fee Income | 9,210 |  |  | 7,180 |  |  | 6,806 |
Non-Recurring Fee Income: |  |  |  |  |
Prepayment fees | 510 |  |  | 303 |  |  | 474 |
Acceleration of unamortized loan origination fees | 1,476 |  |  | 5,595 |  |  | 4,824 |
Advisory, loan amendment and other fees | 2,205 |  |  | 1,845 |  |  | 916 |
Total Non-Recurring Fee Income | 4,191 |  |  | 7,743 |  |  | 6,214 |
Total Fee Income | $ | 13,401 |  |  | $ | 14,923 |  |  | $ | 13,020 |
General and Administrative Expenses General and administrative expenses include administrative costs, facilities costs, insurance, legal and accounting expenses, expenses reimbursable to the Adviser under the terms of the Administration Agreement and other costs related to operating as a publicly-traded company. Segments The Company lends to and invests in customers in various industries. The Company separately evaluates the performance of each of its lending and investment relationships. However, because each of these loan and investment relationships has similar business and economic characteristics, they have been aggregated into a single lending and investment segment. All applicable segment disclosures are included in or can be derived from the Company’s financial statements. Concentration of Credit Risk As of December 31, 2023 and 2022, there were no individual investments representing greater than 10% of the fair value of the Company’s portfolio. As of December 31, 2023 and 2022, the Company’s largest single portfolio company investment represented approximately 6.3% and 5.9%, respectively, of the fair value of the Company’s portfolio. Income, consisting of interest, dividends, fees, other investment income and realization of gains or losses on equity interests, can fluctuate dramatically upon repayment of an investment or sale of an equity interest and in any given year can be highly concentrated among several portfolio companies. As of December 31, 2023, all of the Company’s assets were or will be pledged as collateral for the February 2019 Credit Facility. Investments Denominated in Foreign Currency As of December 31, 2023 the Company held two investments that were denominated in Canadian dollars, one investment that was denominated in Danish kroner, 11 investments that were denominated in Australian dollars, two investments that were denominated in New Zealand dollars, one investment that was denominated in Norwegian krone, two investments that were denominated in Swiss francs, two investment that was denominated in Swedish krona, 67 investments that were denominated in Euros and 28 investments that were denominated in British pounds sterling. As of December 31, 2022, the Company held two investments that were denominated in Canadian dollars, one investment that was denominated in Danish kroner, 11 investments that were denominated in Australian dollars, two investments that were denominated in New Zealand dollars, one investment that was denominated in Norwegian krone, one investment that was denominated in Swiss francs, one investment that was denominated in Swedish krona, 58 investments that were denominated in Euros and 28 investments that were denominated in British pounds sterling. At each balance sheet date, portfolio company investments denominated in foreign currencies are translated into United States dollars using the spot exchange rate on the last business day of the period. Purchases and sales of foreign portfolio company investments, and any income from such investments, are translated into United States dollars using the rates of exchange prevailing on the respective dates of such transactions. Although the fair values of foreign portfolio company investments and the fluctuation in such fair values are translated into United States dollars using the applicable foreign exchange rates described above, the Company does not separately report that portion of the change in fair values resulting from foreign currency exchange rate fluctuations from the change in fair values of the underlying investment. All fluctuations in fair value are included in net unrealized appreciation (depreciation) of investments in the Company’s Consolidated Statements of Operations. In addition, during the years ended December 31, 2023 and 2022, the Company entered into forward currency contracts primarily to help mitigate the impact that an adverse change in foreign exchange rates would have on net interest income from the Company’s investments and related borrowings denominated in foreign currencies. Net unrealized appreciation or depreciation on foreign currency contracts are included in “Net unrealized appreciation (depreciation) - forward currency contracts” and net realized gains or losses on forward currency contracts are included in “Net realized gains (losses) - forward currency contracts” in the Consolidated Statements of Operations. Investments denominated in foreign currencies and foreign currency transactions may involve certain considerations and risks not typically associated with those of domestic origin, including unanticipated movements in the value of the foreign currency relative to the U.S. Dollar. Dividends and Distributions Dividends and distributions to common stockholders are approved by the Board and dividends payable are recorded on the ex-dividend date. The Company has adopted a dividend reinvestment plan (“DRIP”) that provides for reinvestment of dividends on behalf of its stockholders, unless a stockholder elects to receive cash. As a result, when the Company declares a dividend, stockholders who have not opted out of the DRIP will have their dividends automatically reinvested in shares of the Company’s common stock, rather than receiving cash dividends. The table below summarizes the Company’s dividends and distributions in the three years ended December 31, 2023:
Declared ($ in thousands, except per share amounts) |  | Record |  | Payable |  | Per Share Amount |  | Amount Paid in Cash |  | Amount Settled via Newly Issued Shares |  | Total
February 7, 2021 |  | March 10, 2021 |  | March 17, 2021 |  | $ | 0.19 |  |  | $ | 12,410 |  |  | $ | — |  |  | $ | 12,410 |
May 6, 2021 |  | June 9, 2021 |  | June 16, 2021 |  | 0.20 |  |  | 13,063 |  |  | — |  |  | 13,063 |
August 5, 2021 |  | September 8, 2021 |  | September 15, 2021 |  | 0.21 |  |  | 13,716 |  |  | — |  |  | 13,716 |
November 9, 2021 |  | November 24, 2021 |  | December 1, 2021 |  | 0.22 |  |  | 14,370 |  |  | — |  |  | 14,370 |
Total 2021 dividends and distributions |  | $ | 0.82 |  |  | $ | 53,559 |  |  | $ | — |  |  | $ | 53,559 |
February 1, 2022 |  | February 16, 2022 |  | February 23, 2022 |  | $ | 0.23 |  |  | $ | 15,023 |  |  | $ | — |  |  | $ | 15,023 |
May 5, 2022 |  | June 8, 2022 |  | June 15, 2022 |  | 0.24 |  |  | 26,506 |  |  | — |  |  | 26,506 |
August 9, 2022 |  | September 7, 2022 |  | September 14, 2022 |  | 0.24 |  |  | 26,198 |  |  | — |  |  | 26,198 |
November 10, 2022 |  | December 7, 2022 |  | December 14, 2022 |  | 0.24 |  |  | 25,999 |  |  | — |  |  | 25,999 |
Total 2022 dividends and distributions |  | $ | 0.95 |  |  | $ | 93,726 |  |  | $ | — |  |  | $ | 93,726 |
February 23, 2023 |  | March 8, 2023 |  | March 15, 2023 |  | $ | 0.25 |  |  | $ | 26,979 |  |  | $ | — |  |  | $ | 26,979 |
May 4, 2023 |  | June 7, 2023 |  | June 14, 2023 |  | 0.25 |  |  | 26,667 |  |  | — |  |  | 26,667 |
August 9, 2023 |  | September 6, 2023 |  | September 13, 2023 |  | 0.26 |  |  | 27,694 |  |  | — |  |  | 27,694 |
November 9, 2023 |  | December 6, 2023 |  | December 13, 2023 |  | 0.26 |  |  | 27,657 |  |  | — |  |  | 27,657 |
Total 2023 dividends and distributions |  | $ | 1.02 |  |  | $ | 108,997 |  |  | $ | — |  |  | $ | 108,997 |
Per Share Amounts Per share amounts included in the Consolidated Statements of Operations are computed by dividing net investment income and net increase in net assets resulting from operations by the weighted average number of shares of common stock outstanding for the period. As the Company has no common stock equivalents outstanding, diluted per share amounts are the same as basic per share amounts. NAV per share is computed by dividing total net assets by the number of common shares outstanding as of the end of the period.

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