Stuart Aronson: By the way, if our analysts have views as to which is a better path, if you understand the risks and rewards of what we can do. We’d be very happy to take your feedback from both analysts and shareholders as to what you guys think the right path is. But definitely during the current period with current rates and current base rates, we are seeing excess income, as evidenced by the $0.07 special dividend this quarter.
Erik Zwick: And then just looking at the concentration of the portfolio that mixed between sponsored and non sponsored, for a number of years that that sponsored portion was growing steadily. It did come back a little bit here last year in 2022. I’m curious if that was a reflection of intent on your part, or maybe just market dynamics and how you would expect that to trend in future quarters?
Stuart Aronson: In general, our originations activity is about 75% sponsor, and 25% non-sponsor. But for the BDC balance sheet, we’re only including assets that are priced to 700 or higher, SOFR 700 or higher. So, to the extent we’re doing sponsor assets that are priced at 650 or 675, which historically would have gone on the BDC balance sheet, but in today’s market environment, they’re not, those deals if they don’t fit in the JV, don’t fit into the BDC. So, the BDC gets more of the non-sponsor deals, which have a generally higher yield profile. Sponsor deals in today’s market, we see pricing in a range of 650 to 750. And non-sponsor deals in today’s market, we see pricing at a range of 700 to 900. So, pretty much all the non-sponsor deals we’re looking at price at a level that fits onto the BDC balance sheet, assuming that that balance sheet has room.
Erik Zwick: That makes sense. I appreciate the clarity. And just one last one for me on the kind of credit quality front. I’m curious, have you seen any uptick in amendment requests from any of your portfolio companies?
Stuart Aronson: Absolutely. We have companies — again, the companies that have been affected by the consumer-led slowdown have tripped covenants. Where covenants have been tripped, we are generally looking for a combination of equity support and higher rate. That’s the beauty of having covenants is that when you trip a covenant, you’re able to get both credit protection to the downside and typically a higher rate. And as I mentioned in my prepared remarks, the private equity firms that own the companies we’ve lent to have been remarkably supportive. I would say, with the exception of PlayMonster, where the private equity firm walked away from the company because of fraud, pretty much every heavily impacted private equity based account we’ve had has demonstrated support for the company with either cash or contingent equity. It’s been pretty much universal.
Operator: Our next question comes from Robert Dodd with Raymond James.
Robert Dodd: I have a couple of housekeeping ones first, if I can. On the prepay fees or prepay and related fees, right? I think Stuart in your prepared remarks, you said it, I think it was $2.6 million from a couple of assets. The other income range is $1.9 million. So, is it fair to say that maybe $1.5 million of that was in other income and then 1 — just over $1 million was embedded explicitly in interest income?
Stuart Aronson: Joyson, I’ll pass that to you in terms of the characterization of how the numbers work through.
Joyson Thomas: Yes. Robert, fee income for Q4 was $1.9 million. And as we mentioned that that was predominantly due to prepayment fees that were generated on Escalon Services and CHS Therapy.
Robert Dodd: Got it. But was there any accelerated amortization related to — showed up at the interest income?
Joyson Thomas: Yes, sounds correct. The accelerated amort worked, about 700,000.
Robert Dodd: How much — in terms of talking about dividend policy over there. How much taxable spillover do you have currently? Because obviously, historically it’s been high and that’s going to affect your decision making as well.
