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Borrowings (Tables)
 9 Months Ended
Sep. 30, 2024
Debt Instrument [Line Items]  
Schedule of Debt Obligations

The Company’s debt obligations consist of the following:

 

($ in thousands)

September 30, 2024

 

December 31, 2023

 

2018-2 Secured Notes (net of original issue discount of $— and $712, respectively)

$

—

 

$

124,971

 

4.875% Notes Due 2026 (net of deferred financing costs and original issue discount of $1,208 and $1,786, respectively)

 

106,792

 

 

106,214

 

Great Lakes Portman Ridge Funding LLC Revolving Credit Facility (net of deferred financing costs of $1,352 and $775, respectively)

 

158,126

 

 

91,225

 

$

264,918

 

$

322,410

 
Schedule of Interest Expense, Amortization of Original Issue Discount, Deferred Financing Costs, Average Outstanding Balance, and Average Stated Interest Rate

The following table summarizes the interest expense, amortization of original issue discount, deferred financing costs, average outstanding balance, and average stated interest rate on the 4.875% Notes due 2026 for the three and nine months ended September 30, 2024 and 2023.

 

 

For the Three Months Ended September 30,

 

For the Nine Months Ended September 30,

 

($ in thousands)

2024

 

2023

 

2024

 

2023

 

 Interest expense

$

1,316

 

$

1,316

 

$

3,949

 

$

3,949

 

 Amortization of original issue discount

 

128

 

 

121

 

 

377

 

 

357

 

 Deferred financing costs

 

68

 

 

64

 

 

201

 

 

191

 

 Total interest and financing expenses

$

1,512

 

$

1,501

 

$

4,527

 

$

4,497

 

 Average outstanding balance

$

108,000

 

$

108,000

 

$

108,000

 

$

108,000

 

 Average stated interest rate

 

4.88

%

 

4.88

%

 

4.88

%

 

4.88

%

The following table summarizes the interest expense, deferred financing costs, average outstanding balance, and average stated interest rate on the Revolving Credit Facility for the three and nine months ended September 30, 2024 and 2023.

 

 

For the Three Months Ended September 30,

 

For the Nine Months Ended September 30,

 

($ in thousands)

2024

 

2023

 

2024

 

2023

 

 Interest expense

$

2,537

 

$

1,919

 

$

6,401

 

$

5,499

 

 Deferred financing costs

 

108

 

 

83

 

 

274

 

 

249

 

 Total interest and financing expenses

$

2,645

 

$

2,002

 

$

6,675

 

$

5,748

 

 Average outstanding balance

$

121,856

 

$

90,935

 

$

102,134

 

$

91,650

 

 Average stated interest rate

 

7.99

%

 

8.05

%

 

8.01

%

 

7.71

%

The following table summarizes the interest expense, amortization of original issue discount, average outstanding balance, and average stated interest rate on the 2018-2 Secured Notes for the three and nine months ended September 30, 2024 and 2023.

 

 

For the Three Months Ended September 30,

 

For the Nine Months Ended September 30,

 

($ in thousands)

2024

 

2023

 

2024

 

2023

 

 Interest expense

$

952

 

$

2,813

 

$

4,951

 

$

8,706

 

 Amortization of original issue discount

 

11

 

 

27

 

 

57

 

 

96

 

 Total interest and financing expenses

$

963

 

$

2,840

 

$

5,008

 

$

8,802

 

 Average outstanding balance

$

47,159

 

$

144,027

 

$

81,937

 

$

159,925

 

 Average stated interest rate

 

8.07

%

 

7.69

%

 

7.99

%

 

7.16

%
Schedule of Information about Senior Securities

Information about the Company’s senior securities is shown as of the dates indicated in the below table.

Class and Period

 

Total Amount
Outstanding
Exclusive of
Treasury
Securities(1)

 

 

Asset Coverage per
Unit(2)

 

 

Involuntary
Liquidating
Preference per
Unit(3)

 

 

Average Market
Value per Unit(4)

($ in thousands)

 

 

 

 

 

 

 

 

 

 

 

Fiscal 2013

 

$

192,592

 

 

 

2,264

 

 

 

—

 

 

N/A

Fiscal 2014

 

 

223,885

 

 

 

2,140

 

 

 

—

 

 

N/A

Fiscal 2015

 

 

208,049

 

 

 

2,025

 

 

 

—

 

 

N/A

Fiscal 2016

 

 

180,881

 

 

 

2,048

 

 

 

—

 

 

N/A

Fiscal 2017

 

 

104,407

 

 

 

2,713

 

 

 

—

 

 

N/A

Fiscal 2018

 

 

103,763

 

 

 

2,490

 

 

 

—

 

 

N/A

Fiscal 2019(5)

 

 

156,978

 

 

 

1,950

 

 

 

—

 

 

N/A

Fiscal 2020(6)

 

 

377,910

 

 

 

1,560

 

 

 

—

 

 

N/A

Fiscal 2021(7)

 

 

352,434

 

 

 

1,780

 

 

 

—

 

 

N/A

Fiscal 2022(8)

 

 

378,163

 

 

 

1,601

 

 

 

—

 

 

N/A

Fiscal 2023(9)

 

 

325,683

 

 

 

1,646

 

 

 

—

 

 

N/A

September 30, 2024(10)

 

 

267,478

 

 

 

1,703

 

 

 

—

 

 

N/A

 

(1)
Total amount of each class of senior securities outstanding at the end of the period presented.
(2)
Asset coverage per unit is the ratio of the carrying value of PTMN’s total consolidated assets, less all liabilities and indebtedness not represented by senior securities, to the aggregate amount of senior securities representing indebtedness. Asset coverage per unit is expressed in terms of dollar amounts per $1,000 of indebtedness.
(3)
The amount to which such class of senior security would be entitled upon the involuntary liquidation of the issuer in preference to any security junior to it. The “—” indicates information which the SEC expressly does not require to be disclosed for certain types of senior securities.
(4)
Not applicable, except with respect to the 7.375% Notes Due 2019 and the 6.125% Notes Due 2022, as other debt securities are not registered for public trading. For the years ended December 31, 2017, 2016, 2015, 2014, and 2013, the average market value per $1,000 of par value of the 7.375% Notes Due 2019 was $1,016.04, $1,000.00, $1,011.96, $1,037.72, and $1,032.96, respectively. For the years-ended December 31, 2020, 2019 and 2018 and for the period from August 14, 2017 (date of issuance) to December 31, 2017, the average market value per $1,000 of par value of the 6.125% Notes Due 2022 was $953.20, $1,009.93, $1,009.20 and $1,006.00, respectively. Average market value is computed by taking the daily average of the closing prices for the period.
(5)
As of December 31, 2019, the Total Amount Outstanding Exclusive of Treasury Securities consisted of 6.125% Notes Due 2022 of $77,407 and Revolving Credit Facilities of $79,571.
(6)
As of December 31, 2020, the Total Amount Outstanding Exclusive of Treasury Securities consisted of 6.125% Notes Due 2022 of $76,726, Revolving Credit Facilities of $49,321 and 2018-2 Secured Notes of $251,863.
(7)
As of December 31, 2021, the Total Amount Outstanding Exclusive of Treasury Securities consisted of 4.875% Notes due 2026 of $108,000, Revolving Credit Facilities of $80,571 and 2018-2 Secured Notes of $163,863.
(8)
As of December 31, 2022, the Total Amount Outstanding Exclusive of Treasury Securities consisted of 4.875% Notes due 2026 of $108,000, Revolving Credit Facilities of $92,000 and 2018-2 Secured Notes of $178,163.
(9)
As of December 31, 2023, the Total Amount Outstanding Exclusive of Treasury Securities consisted of 4.875% Notes due 2026 of $108,000, Revolving Credit Facilities of $92,000 and 2018-2 Secured Notes of $125,683.
(10)
As of September 30, 2024, the Total Amount Outstanding Exclusive of Treasury Securities consisted of 4.875% Notes due 2026 of $108,000 and Revolving Credit Facilities of $159,478.
2018-2 Secured Notes  
Debt Instrument [Line Items]  
Summary of 2018-2 Secured Notes

2018-2 Secured Notes:

On October 28, 2020, the Company completed the GARS Acquisition, pursuant to the terms and conditions of the GARS Merger Agreement. In connection therewith, the Company now consolidates the financial statements the 2018-2 CLO a $420.0 million par value CLO facility. On the date of the transaction the debt assumed was recognized at fair value, resulting in a $2.4 million discount which is amortized over the remaining term of the borrowings.

The CLO was executed by GF 2018-2 (the “Issuer”) and Portman Ridge Funding 2018-2 LLC (formerly known as Garrison Funding 2018-2 LLC, together with the Issuer, the “Co-Issuers”) who issued $312.0 million of senior secured notes (collectively referred to as the “2018-2 Secured Notes” individually defined above in the table) and $108.0 million of subordinated notes (the “2018-2 Subordinated Notes” and, together with the 2018-2 Secured Notes, the “2018-2 Notes”) backed by a diversified portfolio of primarily senior secured loans. The Company owns all $108.0 million of the 2018-2 Subordinated Notes and $18.3 million of the Class B-R Notes and serves as collateral manager for the Co-Issuers. The Company is entitled to receive interest from the Class B-R Notes, distributions from the 2018-2 Subordinated Notes and fees for serving as collateral manager in accordance with the CLO’s governing documents and to the extent funds are available for such purposes. However, as a result of retaining all of the 2018-2 Subordinated Notes, the Company consolidates the accounts of the Co-Issuers into its financial statements and all transactions between the Company and the Co-Issuers are eliminated on consolidation. As a result of this consolidation, the 2018-2 Secured Notes issued by the CLO is treated as the Company’s indebtedness, except any 2018-2 Secured Notes owned by the Company, which are eliminated in consolidation. The 2018-2 Notes are scheduled to mature on November 20, 2029, however the Co-Issuers may redeem the 2018-2 Notes on any business day after November 20, 2020. The indenture governing the 2018-2 Notes provides that, to the extent cash is available from cash collections, the holders of the 2018-2 Notes are to receive quarterly interest payments on the 20th day or, if not a business day, the next succeeding business day of February, May, August and November of each year until the stated maturity or earlier redemption. On July 18, 2019, $25.0 million outstanding of the aggregate $50.0 million Class A-1R-R Notes available under the CLO converted to Class A-1T-R Notes. On November 18, 2022, the Company drew $14.3 million of the $25.0 million unfunded Class A-1R-R Notes. The Reinvestment Period ended on November 20, 2022, and the remaining amount of the unfunded Class A1 R-R Notes terminated. During the first quarter of 2021, the Company redeemed approximately $88.0 million of the 2018-2 Secured Notes. In connection therewith, the Company recognized a realized loss on extinguishment of debt of approximately $0.9 million. During 2023, the Company redeemed approximately $52.5 million of the par value of 2018-2 Secured Notes. In connection therewith, the Company recognized a realized loss on extinguishment of approximately $0.4 million.

 

 

($ in thousands)

 

 

 

 

 

 

 

 

 

December 31, 2023

Amortized Carrying Value

 

Outstanding Principal at Par

 

Spread(4)

 

Rating(1)

 

Stated
Maturity(2)

2018-2 Secured Notes:

 

 

 

 

 

 

 

 

 

Class A-1R-R Notes

$

12,818

 

$

12,922

 

Reference Rate + 1.58%(3)

 

AAA(sf)

 

11/20/2029

Class A-1T-R Notes

 

39,369

 

 

39,411

 

Reference Rate + 1.58%

 

AAA(sf)

 

11/20/2029

Class A-2-R Notes

 

54,681

 

 

55,100

 

Reference Rate + 2.45%

 

AA (sf)

 

11/20/2029

Class B-R Notes

 

18,103

 

 

18,250

 

Reference Rate + 3.17%

 

A (sf)

 

11/20/2029

 

$

124,971

 

$

125,683

 

 

 

 

 

 

 

(1)
Represents ratings from each of S&P and DBRS for the Class A-1R-R Notes and the Class A-1T-R Notes and from S&P for the Class A-2-R Notes and Class B-R Notes as of the closing of the CLO on October 18, 2018.
(2)
The indenture governing our CLO permits the repricing or refinancing of the secured notes after November 20, 2020, which may result in the redemption of the outstanding notes occurring prior to their stated maturity.
(3)
Interest may be indexed to either the CP Rate (as defined in the governing indenture) or Reference Rate.
(4)
Reference Rate is defined as the sum of the Term SOFR Rate plus 0.26161%, or 5.63% as of December 31, 2023.