SLR INVESTMENT CORP. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-Q)

The information contained in this section should be read in conjunction with our
consolidated financial statements and notes thereto appearing elsewhere in this
report.

Some of the statements in this report constitute forward-looking statements,
which relate to future events or our future performance or financial condition.
The forward-looking statements contained herein involve risks and uncertainties,
including statements as to:

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

• our business prospects and the prospects of our portfolio companies;

  •   the impact of investments that we expect to make;



  •   our contractual arrangements and relationships with third parties;



         •   the dependence of our future success on the general economy and its
             impact on the industries in which we invest and the impact of the
             COVID-19
             pandemic thereon;



         •   the impact of any protracted decline in the liquidity of credit
             markets on our business and the impact of the
             COVID-19
             pandemic thereon;

• the ability of the companies in our portfolio to achieve their objectives,

             including as a result of the current
             COVID-19
             pandemic;

• the valuation of our holdings in portfolio companies, in particular

             those having no liquid trading market, and the impact of the
             COVID-19
             pandemic thereon;



         •   market conditions and our ability to access alternative debt markets
             and additional debt and equity capital, and the impact of the
             COVID-19
             pandemic thereon;



  •   our expected financings and investments;



  •   the adequacy of our cash resources and working capital;



         •   the timing of cash flows, if any, from the operations of our portfolio
             companies and the impact of the
             COVID-19
             pandemic thereon; and

• the ability of our investment advisor to locate suitable investments

             for us and to monitor and administer our investments and the impacts
             of the
             COVID-19
             pandemic thereon.

• changes in political conditions and relations between the United States

             States, Russia, Ukraine and other nations.


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:

• an economic slowdown, including due to the current crisis

             COVID-19
             pandemic, could impair our portfolio companies' ability to 

continue to

             operate, which could lead to the loss of some or all of our
             investments in such portfolio companies;



         •   a contraction of available credit and/or an inability to access the
             equity markets, including as a result of the current
             COVID-19
             pandemic, could impair our lending and investment activities;



         •   interest rate volatility could adversely affect our results,
             particularly because we use leverage as part of our investment
             strategy;



         •   currency fluctuations could adversely affect the results of our
             investments in foreign companies, particularly to the extent that we
             receive payments denominated in foreign currency rather than U.S.
             dollars;



  •   the ability to realize the anticipated benefits of the Mergers;



  •   the effects of disruption on our business from the Mergers;

• the plans, expectations, objectives and intentions of the combined company

             as a result of the Mergers;



         •   the risks, uncertainties and other factors we identify in Item 1A. -
             Risk Factors contained in our Annual Report on Form
             10-K
             for the year ended December 31, 2021, elsewhere in this Quarterly
             Report on Form
             10-Q
             and in our other filings with the SEC.


We generally use words such as "anticipates," "believes," "expects," "intends"
and similar expressions to identify forward-looking statements. Our actual
results could differ materially from those projected in the forward-looking
statements for any reason, including any factors set forth in "Risk Factors" and
elsewhere in this report.

We have based the forward-looking statements included in this report on
information available to us on the date of this report, and we assume no
obligation to update any such forward-looking statements. Although we undertake
no obligation to revise or update any forward-looking statements, whether as a
result of new information, future events or otherwise, you are advised to
consult any additional disclosures that we may make directly to you or through
reports that we in the future may file with the SEC, including any annual
reports on Form
10-K,
quarterly reports on Form
10-Q
and current reports on Form
8-K.

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Insight

Solar Capital LLCa Maryland limited liability company, was incorporated in February 2007 and started operations on March 13, 2007 to the initial capital of
$1.2 billion of which 47.04% was financed by affiliated parties.

SLR Investment Corp. (the "Company", "SLRC", "we" or "our"), a Maryland
corporation formed in November 2007, is a
closed-end,
externally managed,
non-diversified
management investment company that has elected to be regulated as a business
development company ("BDC") under the Investment Company Act of 1940, as amended
(the "1940 Act"). Furthermore, as the Company is an investment company, it
continues to apply the guidance in the Financial Accounting Standards Board
("FASB") Accounting Standards Codification ("ASC") Topic 946. In addition, for
U.S federal income tax purposes, the Company has elected to be treated as a
regulated investment company ("RIC") under Subchapter M of the Internal Revenue
Code of 1986, as amended (the "Code").

On February 9, 2010, we priced our initial public offering, selling 5.68 million
shares of our common stock. Concurrent with our initial public offering, Michael
S. Gross, our Chairman,
Co-Chief
Executive Officer and President, and Bruce Spohler, our
Co-Chief
Executive Officer and Chief Operating Officer, collectively purchased an
additional 0.6 million shares of our common stock through a private placement
transaction exempt from registration under the Securities Act.

We invest primarily in privately held U.S. middle-market companies, where we
believe the supply of primary capital is limited and the investment
opportunities are most attractive. Our investment objective is to generate both
current income and capital appreciation through debt and equity investments. We
invest primarily in leveraged middle-market companies in the form of senior
secured loans, financing leases and to a lesser extent, unsecured loans and
equity securities. From time to time, we may also invest in public companies
that are thinly traded. Our business is focused primarily on the direct
origination of investments through portfolio companies or their financial
sponsors. Our investments generally range between $5 million and $100 million
each, although we expect that this investment size will vary proportionately
with the size of our capital base and/or with strategic initiatives. Our
investment activities are managed by SLR Capital Partners, LLC (the "Investment
Adviser") and supervised by the board of directors (the "Board)", a majority of
whom are
non-interested,
as such term is defined in the 1940 Act. SLR Capital Management, LLC (the
"Administrator") provides the administrative services necessary for us to
operate.

In addition, we may invest a portion of our portfolio in other types of
investments, which we refer to as opportunistic investments, which are not our
primary focus but are intended to enhance our overall returns. These investments
may include, but are not limited to, direct investments in public companies that
are not thinly traded and securities of leveraged companies located in select
countries outside of the United States.

Merger Agreement

On December 1, 2021, we entered into an Agreement and Plan of Merger, or the
Merger Agreement, with SLR Senior Investment Corp., a Maryland corporation
("SUNS"), Solstice Merger Sub, Inc., a Maryland corporation and our wholly-owned
subsidiary ("Merger Sub"), and, solely for the limited purposes set forth
therein, the Investment Adviser. The Merger Agreement provides that, subject to
the conditions set forth in the Merger Agreement, Merger Sub will merge with and
into SUNS, with SUNS continuing as the surviving company and as SUNS's
wholly-owned subsidiary (the "Merger,") and, immediately thereafter, SUNS will
merge with and into us, with us continuing as the surviving company (together
with the Merger, the "Mergers"). Both the Board and SUNS's board of directors,
including all of the respective independent directors, in each case, on the
recommendation of a special committee comprised solely of the independent
directors of us and SUNS, as applicable, have approved the Merger Agreement and
the transactions contemplated thereby.

The Merger Agreement contains customary representations and warranties by each
of us, SUNS and the Investment Adviser. The Merger Agreement also contains
customary covenants, including, among others, covenants relating to the
operation of each of our and SUNS's businesses during the period prior to the
closing of the Mergers.

Completion of the Mergers, which took place on April 1, 2022was subject to certain closing conditions, as set forth in the merger agreement.

On April 1, 2022, we completed our previously announced acquisition of SUNS.
Pursuant to the Merger Agreement, Merger Sub was first merged with and into
SUNS, with SUNS as the surviving corporation, and, immediately following the
Merger, SUNS was then merged with and into us, with us as the surviving company.
In accordance with the terms of the Merger Agreement, at the effective time of
the Merger, each outstanding share of SUNS's common stock was converted into the
right to receive 0.7796 shares of our common stock (with SUNS's stockholders
receiving cash in lieu of fractional shares of our common stock). As a result of
the Mergers, we issued an aggregate of 12,511,825 shares of our common stock to
former SUNS stockholders.

The Merger is accounted for as an asset acquisition of SLR Senior Investment
Corp. by the Company in accordance with the asset acquisition method of
accounting as detailed in ASC
805-50,
Business Combinations - Related Issues, with the fair value of total

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consideration paid in conjunction with the Merger allocated to the assets
acquired and liabilities assumed based on their relative fair values as of the
date of the Merger. Generally, under asset acquisition accounting, acquiring
assets in groups not only requires ascertaining the cost of the asset (or net
assets), but also allocating that cost to the individual assets (or individual
assets and liabilities) that make up the group. The cost of the group of assets
acquired in an asset acquisition is allocated to the individual assets acquired
or liabilities assumed based on their relative fair values of net identifiable
assets acquired other than certain
"non-qualifying"
assets (for example cash) and does not give rise to goodwill. The Company is the
accounting survivor of the Merger. The Merger was considered a
tax-free
reorganization and the historical cost basis of the acquired SUNS investments
are carried forward for tax purposes.

letter of agreement

On April 1, 2022, in connection with the consummation of the Mergers, we entered
into a letter agreement (the "Letter Agreement") pursuant to which the
Investment Adviser voluntarily agreed to a permanent 25 basis point reduction of
the annual base management fee rate payable by us to the Investment Adviser
pursuant to the Advisory Agreement, resulting in an annual base management fee
rate payable by us to the Investment Adviser of 1.50% on gross assets up to 200%
of our total net assets. We retained the annual base management fee rate payable
by us to the Investment Adviser of 1.00% on gross assets that exceed 200% of our
total net assets.

Recent Developments

On July 6, 2022our Board declared a monthly distribution of $0.136667 per share payable on August 2, 2022 to file holders from July 21, 2022.

On August 2, 2022our Board declared a monthly distribution of $0.136667 per share payable on September 1, 2022 to file holders from August 18, 2022.

The global outbreak of the
COVID-19
pandemic, and the related effect on the U.S. and global economies, has continued
to have adverse consequences for the business operations of some of the
Company's portfolio companies and, as a result, has had adverse effects on the
Company's operations. The ultimate economic fallout from the pandemic, and the
long-term impact on economies, markets, industries and individual issuers,
including the Company, remain uncertain. The operational and financial
performance of the issuers of securities in which the Company invests depends on
future developments, including the duration and spread of the outbreak, and such
uncertainty may in turn adversely affect the value and liquidity of the
Company's investments and negatively impact the Company's performance.

Investments

Our level of investment activity can and does vary substantially from period to
period depending on many factors, including the amount of debt and equity
capital available to middle market companies, the level of merger and
acquisition activity for such companies, the general economic environment and
the competitive environment for the types of investments we make. As a BDC, we
must not acquire any assets other than "qualifying assets" specified in the 1940
Act unless, at the time the acquisition is made, at least 70% of our total
assets are qualifying assets (with certain limited exceptions). Qualifying
assets include investments in "eligible portfolio companies." The definition of
"eligible portfolio company" includes certain public companies that do not have
any securities listed on a national securities exchange and companies whose
securities are listed on a national securities exchange but whose market
capitalization is less than $250 million.

Revenue

We generate revenue primarily in the form of interest and dividend income from
the securities we hold and capital gains, if any, on investment securities that
we may sell. Our debt investments generally have a stated term of three to seven
years and typically bear interest at a floating rate usually determined on the
basis of a benchmark London interbank offered rate ("LIBOR"), commercial paper
rate, or the prime rate. Interest on our debt investments is generally payable
monthly or quarterly but may be
bi-monthly
or semi-annually. In addition, our investments may provide
payment-in-kind
("PIK") income. Such amounts of accrued PIK income are added to the cost of the
investment on the respective capitalization dates and generally become due at
maturity of the investment or upon the investment being called by the issuer. We
may also generate revenue in the form of commitment, origination, structuring
fees, fees for providing managerial assistance and, if applicable, consulting
fees, etc.

Expenses

All of the Investment Adviser’s investment professionals and their respective personnel, when engaged in the provision of investment advice and management services, and the remuneration and ongoing overhead costs of such personnel attributable to

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such services, are provided and paid for by the Investment Adviser. We bear all
other costs and expenses of our operations and transactions, including (without
limitation):

  •   the cost of our organization and public offerings;



     •    the cost of calculating our net asset value, including the cost of any
          third-party valuation services;



     •    the cost of effecting sales and repurchases of our shares and other
          securities;



  •   interest payable on debt, if any, to finance our investments;



     •    fees payable to third parties relating to, or associated with, making

investments, including fees and expenses associated with the execution

          diligence reviews of prospective investments and advisory fees;



  •   transfer agent and custodial fees;



  •   fees and expenses associated with marketing efforts;



  •   federal and state registration fees, any stock exchange listing fees;



  •   federal, state and local taxes;



  •   independent directors' fees and expenses;



  •   brokerage commissions;

• fidelity bond, liability in the event of errors and omissions of directors and managers

          insurance and other insurance premiums;

• direct administration costs and expenses, including printing, mailing,

          long distance telephone and staff;

• fees and expenses associated with independent audits and external legal services

          costs;

• costs associated with our reporting and compliance obligations under the

          1940 Act and applicable federal and state securities laws; and

• all other expenses incurred by either SLR Capital Management or us in

in connection with the administration of our business, including payments under the

administration agreement which will be based on our attributable share of

overhead and other costs incurred by SLR Capital Management in

perform its obligations under the Administration Agreement, including

rent, fees and expenses associated with compliance

duties, and our attributable share of compensation costs and

related expenses of our Chief Compliance Officer and Chief Financial Officer

officer and their respective staffs.

We expect our general and administrative operating expenses related to our
ongoing operations to increase moderately in dollar terms. During periods of
asset growth, we generally expect our general and administrative operating
expenses to decline as a percentage of our total assets and increase during
periods of asset declines. Incentive fees, interest expense and costs relating
to future offerings of securities, among others, may also increase or reduce
overall operating expenses based on portfolio performance, interest rate
benchmarks, and offerings of our securities relative to comparative periods,
among other factors.

Portfolio and investment activity

During the three months ended June 30, 2022, exclusive of the assets acquired
through the Merger, we invested approximately $94.7 million across 29 portfolio
companies. This compares to investing approximately $69.0 million in 12
portfolio companies for the three months ended June 30, 2021. Investments sold,
prepaid or repaid during the three months ended June 30, 2022 totaled
approximately $78.5 million versus approximately $149.7 million for the three
months ended June 30, 2021.

At June 30, 2022, our portfolio consisted of 127 portfolio companies and was
invested 30.0% in cash flow senior secured loans, 30.9% in asset-based senior
secured loans / SLR Credit Solutions ("SLR Credit") / SLR Healthcare ABL / SLR
Business Credit, 14.1% in Kingsbridge Holdings, LLC ("KBH"), 24.3% in equipment
senior secured financings / SLR Equipment Finance ("SLR Equipment") /
Kingsbridge Holdings, LLC ("KBH") and 14.8% in life science senior secured
loans, in each case, measured at fair value, versus 101 portfolio companies and
was invested 23.0% in cash flow senior secured loans, 25.5% in asset-based
senior secured loans / SLR Credit, 33.3% in equipment senior secured financings
/ SLR Equipment / KBH, and 18.2% in life science senior secured loans, in each
case, measured at fair value, at June 30, 2021.

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At June 30, 2022, 77.1% or $1.53 billion of our income producing investment
portfolio
*
is floating rate and 22.9% or $453.7 million is fixed rate, measured at fair
value. At June 30, 2021, 71.6% or $1.07 billion of our income producing
investment portfolio
*
is floating rate and 28.4% or $422.6 million is fixed rate, measured at fair
value. As of June 30, 2022 and 2021, we had two and zero issuers, respectively,
on
non-accrual
status.

* We have included SLR Credit Solutions, SLR Equipment Finance, SLR Health

ABL, SLR Company Credit and Kingsbridge Holdings, LLC in our income

produce an investment portfolio.

SLR Credit Solutions

On December 28, 2012, we acquired an equity interest in Crystal Capital
Financial Holdings LLC ("Crystal Financial") for $275 million in cash. Crystal
Financial owned approximately 98% of the outstanding ownership interest in SLR
Credit Solutions ("SLR Credit"), f/k/a Crystal Financial LLC. The remaining
financial interest was held by various employees of SLR Credit, through their
investment in Crystal Management LP. SLR Credit had a diversified portfolio of
23 loans having a total par value of approximately $400 million at November 30,
2012 and a $275 million committed revolving credit facility. On July 28, 2016,
the Company purchased Crystal Management LP's approximately 2% equity interest
in SLR Credit for approximately $5.7 million. Upon the closing of this
transaction, the Company holds 100% of the equity interest in SLR Credit. On
September 30, 2016, Crystal Capital Financial Holdings LLC was dissolved. As of
June 30, 2022, total commitments to the revolving credit facility are
$250 million.

As of June 30, 2022, SLR Credit had 25 funded commitments to 20 different
issuers with total funded loans of approximately $326.7 million on total assets
of $357.1 million. As of December 31, 2021, SLR Credit had 22 funded commitments
to 19 different issuers with total funded loans of approximately $287.4 million
on total assets of $347.8 million. As of June 30, 2022 and December 31, 2021,
the largest loan outstanding totaled $34.6 million and $35.0 million,
respectively. For the same periods, the average exposure per issuer was
$16.3 million and $15.1 million, respectively. SLR Credit's credit facility,
which is
non-recourse
to the Company, had approximately $125.6 million and $100.7 million of
borrowings outstanding at June 30, 2022 and December 31, 2021, respectively. For
the three months ended June 30, 2022 and 2021, SLR Credit had net income of
$1.9 million and $2.1 million, respectively, on gross income of $6.9 million and
$8.1 million, respectively. For the six months ended June 30, 2022 and 2021, SLR
Credit had net income of $4.7 million and $7.1 million, respectively, on gross
income of $13.6 million and $17.7 million, respectively. Due to timing and
non-cash
items, there may be material differences between GAAP net income and cash
available for distributions. As such, and subject to fluctuations in SLR
Credit's funded commitments, the timing of originations, and the repayments of
financings, the Company cannot guarantee that SLR Credit will be able to
maintain consistent dividend payments to us.

SLR Equipment Financing

On July 31, 2017, we acquired a 100% equity interest in NEF Holdings, LLC, which
conducts its business through its wholly-owned subsidiary Nations Equipment
Finance, LLC. Effective February 25, 2021, Nations Equipment Finance, LLC and
its related companies is doing business as SLR Equipment Finance ("SLR
Equipment"). SLR Equipment is an independent equipment finance company that
provides senior secured loans and leases primarily to U.S. based companies. We
invested $209.9 million in cash to effect the transaction, of which
$145.0 million was invested in the equity of SLR Equipment through our
wholly-owned consolidated taxable subsidiary NEFCORP LLC and our wholly-owned
consolidated subsidiary NEFPASS LLC and $64.9 million was used to purchase
certain leases and loans held by SLR Equipment through NEFPASS LLC. Concurrent
with the transaction, SLR Equipment refinanced its existing senior secured
credit facility into a $150.0 million
non-recourse
facility with an accordion feature to expand up to $250.0 million. In September
2019, SLR Equipment amended the facility, increasing commitments to
$214.0 million with an accordion feature to expand up to $314.0 million and
extended the maturity date of the facility to July 31, 2023.

As of June 30, 2022, SLR Equipment had 130 funded equipment-backed leases and
loans to 56 different customers with a total net investment in leases and loans
of approximately $187.5 million on total assets of $242.0 million. As of
December 31, 2021, SLR Equipment had 135 funded equipment-backed leases and
loans to 61 different customers with a total net investment in leases and loans
of approximately $211.0 million on total assets of $264.0 million. As of
June 30, 2022 and December 31, 2021, the largest position outstanding totaled
$19.3 million and $19.2 million, respectively. For the same periods, the average
exposure per customer was $3.3 million and $3.5 million, respectively. SLR
Equipment's credit facility, which is
non-recourse
to the Company, had approximately $102.2 million and $118.0 million of
borrowings outstanding at June 30, 2022 and December 31, 2021, respectively. For
the three months ended June 30, 2022 and 2021, SLR Equipment had net loss of
$1.8 million and $1.7 million, respectively, on gross income of $4.0 million and
$5.7 million, respectively. For the six months ended June 30, 2022 and 2021, SLR
Equipment had net loss of $1.2 million and $2.0 million, respectively, on gross
income of $9.2 million and $10.6 million, respectively. Due to timing and
non-cash
items, there may be material differences between GAAP net income and cash
available for distributions. As such, and subject to fluctuations in SLR
Equipment's funded commitments, the timing of originations, and the repayments
of financings, the Company cannot guarantee that SLR Equipment will be able to
maintain consistent dividend payments to us.

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Kingsbridge Holdings, LLC

On November 3, 2020, the Company acquired 87.5% of Kingsbridge Holdings, LLC
("KBH") through KBH Topco LLC ("KBHT"), a newly formed Delaware corporation. KBH
is a residual focused independent
mid-ticket
lessor of equipment primarily to U.S. investment grade companies. The Company
invested $216.6 million to effect the transaction, of which $136.6 million was
invested to acquire 87.5% of KBHT's equity and $80.0 million in KBH's debt. The
existing management team of KBH committed to continue to lead KBH after the
transaction. Following the transaction, the Company owns 87.5% of KBHT equity
and the KBH management team owns the remaining 12.5% of KBHT's equity.

As of June 30, 2022 and December 31, 2021, KBHT had total assets of
$754.8 million and $738.4 million, respectively. For the same periods, debt
recourse to KBHT totaled $243.2 million and $216.9 million, respectively, and
non-recourse
debt totaled $323.0 million and $323.8 million, respectively. None of the debt
is recourse to the Company. For the three months ended June 30, 2022 and 2021,
KBHT had net income of $3.7 million and $2.3 million, respectively, on gross
income of $77.3 million and $58.1 million, respectively. For the six months
ended June 30, 2022 and 2021, KBHT had net income of $7.1 million and
$6.0 million, respectively, on gross income of $143.7 million and
$119.6 million, respectively. Due to timing and
non-cash
items, there may be material differences between GAAP net income and cash
available for distributions. As such, and subject to fluctuations in KBHT's
funded commitments, the timing of originations, and the repayments of
financings, the Company cannot guarantee that KBHT will be able to maintain
consistent dividend payments to us.

SLR Health ABL

SUNS acquired an equity interest in SLR Healthcare ABL, f/k/a Gemino Healthcare
Finance, LLC ("SLR Healthcare") on September 30, 2013. SLR Healthcare is a
commercial finance company that originates, underwrites, and manages primarily
secured, asset-based loans for small and
mid-sized
companies operating in the healthcare industry. SUNS initial investment in SLR
Healthcare ABL was $32.8 million. The management team of SLR Healthcare
co-invested
in the transaction and continues to lead SLR Healthcare. As of June 30, 2022,
SLR Healthcare's management team and the Company own approximately 7% and 93% of
the equity in SLR Healthcare, respectively. SLRC acquired SLR Healthcare in
connection with the Merger on April 1, 2022.

Concurrent with the closing of the transaction, SLR Healthcare entered into a
new, four-year,
non-recourse,
$100 million credit facility with
non-affiliates,
which was expandable to $150 million under its accordion feature. Effective
March 31, 2014, the credit facility was expanded to $105 million and again on
June 27, 2014 to $110 million. On May 27, 2016, SLR Healthcare entered into a
new $125 million credit facility which replaced the previously existing
facility. The new facility has similar terms as compared to the previous
facility and includes an accordion feature increase to $200 million and had a
maturity date of May 27, 2020. On June 28, 2019, this $125 million facility was
amended, extending the maturity date to June 28, 2023.

SLR Healthcare currently manages a highly diverse portfolio of
directly-originated and underwritten senior-secured commitments. As of June 30,
2022, the portfolio totaled approximately $179.8 million of commitments with a
total net investment in loans of $77.5 million on total assets of $89.7 million.
As of December 31, 2021, the portfolio totaled approximately $183.5 million of
commitments with a total net investment in loans of $81.6 million on total
assets of $91.3 million. At June 30, 2022, the portfolio consisted of 38 issuers
with an average balance of approximately $2.0 million versus 36 issuers with an
average balance of approximately $2.3 million at December 31, 2021. All of the
commitments in SLR Healthcare's portfolio are floating-rate, senior-secured,
cash-pay
loans. SLR Healthcare's credit facility, which is
non-recourse
to us, had approximately $59 million and $60 million of borrowings outstanding
at June 30, 2022 and December 31, 2021, respectively. For the three months ended
June 30, 2022 and 2021, SLR Healthcare had net income (loss) of $0.8 million and
($0.1) million, respectively, on gross income of $2.5 million and $2.0 million,
respectively. For the six months ended June 30, 2022 and 2021, SLR Healthcare
had net income of $1.7 million and $0.5 million, respectively, on gross income
of $4.9 million and $4.4 million, respectively. Due to timing and
non-cash
items, there may be material differences between GAAP net income and cash
available for distributions.

SLR Company Credit

SUNS acquired 100% of the equity interests of North Mill Capital LLC ("NMC") on
October 20, 2017. NMC is a leading asset-backed lending commercial finance
company that provides senior secured asset-backed financings to U.S. based
small-to-medium-sized
businesses primarily in the manufacturing, services and distribution industries.
SUNS invested approximately $51.0 million to effect the transaction.
Subsequently, SUNS contributed 1% of its equity interest in NMC to ESP SSC
Corporation. Immediately thereafter, SUNS and ESP SSC Corporation contributed
their equity interests to NorthMill LLC ("North Mill"). On May 1, 2018, North
Mill merged with and into NMC, with NMC being the surviving company. SUNS and
ESP SSC Corporation then owned 99% and 1% of the equity interests of NMC,
respectively. The management team of NMC continues to lead NMC. On June 28,
2019, North Mill Holdco LLC ("NM Holdco"), a newly formed entity and ESP SSC
Corporation acquired 100% of Summit Financial Resources, a Salt Lake City-based
provider of asset-backed financing to small and
medium-sized
businesses. As part of this transaction, SUNS 99% interest in the equity of NMC
was contributed to NM Holdco. This approximately $15.5 million transaction

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was financed with borrowings on NMC's credit facility. Effective February 25,
2021, NMC and its related companies are doing business as SLR Business Credit.
On June 3, 2021, NMC acquired 100% of Fast Pay Partners LLC, a Los Angeles-based
provider of asset-backed financing to digital media companies. The transaction
purchase price of $66.7 million was financed with equity from SUNS of
$19.0 million and borrowings on NMC's credit facility of $47.7 million. SLRC
acquired SLR Business Credit in connection with the Merger on April 1, 2022.

SLR Business Credit currently manages a highly diverse portfolio of
directly-originated and underwritten senior-secured commitments. As of June 30,
2022, the portfolio totaled approximately $566.0 million of commitments, of
which $278.2 million were funded, on total assets of $318.7 million. As of
December 31, 2021, the portfolio totaled approximately $513.9 million of
commitments, of which $248.7 million were funded, on total assets of
$290.8 million. At June 30, 2022, the portfolio consisted of 116 issuers with an
average balance of approximately $2.4 million versus 125 issuers with an average
balance of approximately $2.0 million at December 31, 2021. NMC has a senior
credit facility with a bank lending group for $240 million which expires on
November 13, 2024. Borrowings are secured by substantially all of NMC's
assets. NMC's credit facility, which is
non-recourse
to us, had approximately $210.9 million and $183.3 million of borrowings
outstanding at June 30, 2022 and December 31, 2021, respectively. For the three
months ended June 30, 2022 and 2021, SLR Business Credit had net income of
$1.9 million and $1.3 million, respectively, on gross income of $6.6 million and
$5.5 million, respectively. For the six months ended June 30, 2022 and 2021, SLR
Business Credit had net income of $3.7 million and $2.2 million, respectively,
on gross income of $12.8 million and $9.8 million, respectively. Due to timing
and
non-cash
items, there may be material differences between GAAP net income and cash
available for distributions. As such, and subject to fluctuations in SLR
Business Credit's funded commitments, the timing of originations, and the
repayments of financings, the Company cannot guarantee that SLR Business Credit
will be able to maintain consistent dividend payments to us.

Share buyback program

On May 3, 2022, our Board authorized a program for the purpose of repurchasing
up to $50 million of our outstanding shares of common stock. Under the
repurchase program, we may, but are not obligated to, repurchase shares of our
outstanding common stock in the open market from time to time provided that we
comply with our code of ethics and the guidelines specified in Rule
10b-18
of the Exchange Act, including certain price, market volume and timing
constraints. In addition, any repurchases will be conducted in accordance with
the 1940 Act. Unless amended or extended by our Board, we expect the repurchase
program to be in place until the earlier of May 1, 2023 or until $50 million of
our outstanding shares of common stock have been repurchased. The timing and
number of shares to be repurchased will depend on a number of factors, including
market conditions. There are no assurances that we will engage in any
repurchases. As of June 30, 2022 no repurchases have taken place.

Critical accounting policies

The preparation of consolidated financial statements and related disclosures in
conformity with GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, disclosure of contingent
assets and liabilities at the date of the consolidated financial statements, and
revenues and expenses during the periods reported. Actual results could
materially differ from those estimates. We have identified the following items
as critical accounting policies. Within the context of these critical accounting
policies and disclosed subsequent events herein, we are not currently aware of
any other reasonably likely events or circumstances that would result in
materially different amounts being reported.

Valuation of portfolio investments

We conduct the valuation of our assets, pursuant to which our net asset value is
determined, at all times consistent with GAAP, and the 1940 Act. Our valuation
procedures are set forth in more detail in Note 2(b) to the Company's
Consolidated Financial Statements.

The determination of fair value involves subjective judgments and estimates. Accordingly, the notes to our consolidated financial statements express uncertainty as to the possible effect of such assessments, and any changes in such assessments, on our consolidated financial statements.

Revenue recognition

The Company records dividend income and interest, adjusted for amortization of
premium and accretion of discount, on an accrual basis. Investments that are
expected to pay regularly scheduled interest and/or dividends in cash are
generally placed on
non-accrual
status when principal or interest/dividend cash payments are past due 30 days or
more (90 days or more for equipment financing) and/or when it is no longer
probable that principal or interest/dividend cash payments will be collected.
Such
non-accrual
investments are restored to accrual status if past due principal and interest or
dividends are paid in cash, and in management's judgment, are likely to continue
timely payment of their remaining interest or dividend obligations. Interest or
dividend cash payments received on investments may be recognized as income or
applied to principal depending upon management's judgment. Some of our
investments may have contractual PIK income. PIK income computed at the
contractual rate, as applicable, is accrued and reflected as

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a receivable up to the capitalization date. PIK investments offer issuers the
option at each payment date of making payments in cash or in additional
securities. When additional securities are received, they typically have the
same terms, including maturity dates and interest rates as the original
securities issued. On these payment dates, the Company capitalizes the accrued
interest or dividends receivable (reflecting such amounts as the basis in the
additional securities received). PIK generally becomes due at the maturity of
the investment or upon the investment being called by the issuer. At the point
the Company believes PIK is not expected to be realized, the PIK investment will
be placed on
non-accrual
status. When a PIK investment is placed on
non-accrual
status, the accrued, uncapitalized interest or dividends is reversed from the
related receivable through interest or dividend income, respectively. The
Company does not reverse previously capitalized PIK income. Upon capitalization,
PIK is subject to the fair value estimates associated with their related
investments. PIK investments on
non-accrual
status are restored to accrual status if the Company again believes that PIK is
expected to be realized. Loan origination fees, original issue discount, and
market discounts are capitalized and amortized into income using the effective
interest method. Upon the prepayment of a loan, any unamortized loan origination
fees are recorded as interest income. We record prepayment premiums on loans and
other investments as interest income when we receive such amounts. Capital
structuring fees are recorded as other income when earned.

The typically higher yields and interest rates on PIK securities, to the extent
we invested, reflects the payment deferral and increased credit risk associated
with such instruments and that such investments may represent a significantly
higher credit risk than coupon loans. PIK securities may have unreliable
valuations because their continuing accruals require continuing judgments about
the collectability of the deferred payments and the value of any associated
collateral. PIK income has the effect of generating investment income and
increasing the incentive fees payable at a compounding rate. In addition, the
deferral of PIK income also increases the
loan-to-value
ratio at a compounding rate. PIK securities create the risk that incentive fees
will be paid to the Investment Adviser based on
non-cash
accruals that ultimately may not be realized, but the Investment Adviser will be
under no obligation to reimburse the Company for these fees. For the three and
six months ended June 30, 2022, capitalized PIK income totaled $0.7 million and
$1.0 million, respectively. For the three and six months ended June 30, 2021,
capitalized PIK income totaled $1.6 million and $3.3 million, respectively.

Net realized gain or loss and net change in unrealized gain or loss

We generally measure realized gain or loss by the difference between the net
proceeds from the repayment or sale and the amortized cost basis of the
investment, without regard to unrealized appreciation or depreciation previously
recognized, but considering unamortized origination or commitment fees and
prepayment penalties. The net change in unrealized gain or loss reflects the
change in portfolio investment values during the reporting period, including the
reversal of previously recorded unrealized gain or loss, when gains or losses
are realized. Gains or losses on investments are calculated by using the
specific identification method.

Income taxes

SLRC, a U.S. corporation, has elected to be treated, and intends to qualify
annually, as a RIC under Subchapter M of the Code. In order to qualify for U.S.
federal income taxation as a RIC, the Company is required, among other things,
to timely distribute to its stockholders at least 90% of investment company
taxable income, as defined by the Code, for each year. Depending on the level of
taxable income earned in a given tax year, we may choose to carry forward
taxable income in excess of current year distributions into the next tax year
and pay a nondeductible 4% U.S. federal excise tax on such income, as required.
To the extent that the Company determines that its estimated current year annual
taxable income will be in excess of estimated current year distributions, the
Company accrues an estimated excise tax, if any, on estimated excess taxable
income.

Recent accounting pronouncements

In March 2020, the FASB issued Accounting Standards Update
No. 2020-04,
"Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference
Rate Reform on Financial Reporting." The guidance provides optional expedients
and exceptions for applying GAAP to contract modifications, hedging
relationships and other transactions, subject to meeting certain criteria, that
reference LIBOR or another reference rate expected to be discontinued because of
the reference rate reform. ASU
2020-04
is effective for all entities as of March 12, 2020 through December 31, 2022.
The Company has determined that the adoption of this guidance has not had a
material impact on the Company's consolidated financial statements and
disclosures.

RESULTS OF OPERATIONS

The comparisons of results are for the three and six months ended June 30, 2022 and
June 30, 2021:

Investment Income

For the three and six months ended June 30, 2022, gross investment income
totaled $42.8 million and $75.8 million, respectively. For the three and six
months ended June 30, 2021, gross investment income totaled $35.6 million and
$71.5 million, respectively. The increase in gross investment income for the
year over year three and six month periods was primarily due to a larger
portfolio size as a result of the Merger, as well as due to an increase in LIBOR
and SOFR.

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Expenses

Net expenses totaled $22.5 million and $42.0 million, respectively, for the
three and six months ended June 30, 2022, of which $11.6 million and
$18.9 million, respectively, were base management fees and gross
performance-based incentive fees and $10.4 million and $18.7 million,
respectively, were interest and other credit facility expenses. Over the same
periods, $1.4 million and $1.4 million, respectively, of performance-based
incentive fees were waived. Administrative services and other general and
administrative expenses totaled $1.9 million and $5.8 million, respectively, for
the three and six months ended June 30, 2022. Expenses totaled $20.1 million and
$40.5 million, respectively, for the three and six months ended June 30, 2021,
of which $10.8 million and $21.4 million, respectively, were base management
fees and performance-based incentive fees and $7.2 million and $14.4 million,
respectively, were interest and other credit facility expenses. Administrative
services and other general and administrative expenses totaled $2.1 million and
$4.7 million, respectively, for the three and six months ended June 30, 2021.
Expenses generally consist of management and performance-based incentive fees,
interest and other credit facility expenses, administrative services fees,
insurance expenses, legal fees, directors' fees, transfer agency fees, printing
and proxy expenses, audit and tax services expenses, and other general and
administrative expenses. Interest and other credit facility expenses generally
consist of interest, unused fees, agency fees and loan origination fees, if any,
among others. The increase in expenses for the year over year three and six
month periods was primarily due to higher interest expense associated with the
increase in LIBOR and SOFR.

Net Investment Income

The Company's net investment income totaled $20.3 million and $33.8 million, or
$0.37 and $0.70, per average share, respectively, for the three and six months
ended June 30, 2022. The Company's net investment income totaled $15.5 million
and $31.0 million, or $0.37 and $0.73, per average share, respectively, for the
three and six months ended June 30, 2021.

Net realized gain (loss)

The Company had investment sales and prepayments totaling approximately
$79 million and $180 million, respectively, for the three and six months ended
June 30, 2022. Net realized losses over the same periods were $0.1 million and
$0.08 million, respectively. The Company had investment sales and prepayments
totaling approximately $150 million and $214 million, respectively, for the
three and six months ended June 30, 2021. Net realized gains over the same
periods were $0.6 million and $0.2 million, respectively. Net realized losses
for the three and six months ended June 30, 2022 were de minimis. Net realized
gains for the three months ended June 30, 2021 were generally related to the
exit of our warrant position in PQ Bypass, Inc. Net realized gains for the six
months ended June 30, 2021 were generally related to the exit of our warrant
position in PQ Bypass, Inc., partially offset by losses from the sale of our
legacy investment in B. Riley Financial, Inc.

Net change in unrealized gains (losses)

For the three and six months ended June 30, 2022, net change in unrealized loss
on the Company's assets and liabilities totaled $35.8 million and $47.9 million,
respectively. For the three and six months ended June 30, 2021, net change in
unrealized gain on the Company's assets and liabilities totaled $2.5 million and
$8.9 million, respectively. Net unrealized loss for the three and six months
ended June 30, 2022 is primarily due to depreciation in the value of our
investments in PhyMed Management LLC, Rug Doctor LLC, American Teleconferencing
Services, Ltd., SLR Credit Solutions and SLR Equipment Finance, among others,
partially offset by unrealized appreciation on assets acquired in the Merger due
to the accounting treatment of the purchase discount. Net unrealized gain for
the three months ended June 30, 2021 is primarily due to appreciation in the
value of our investments in PhyMed Management LLC, KBH Topco, LLC and Foundation
Brands, LLC, among others, partially offset by the reversal of previously
recognized appreciation in our investment in Genmark Diagnostics, Inc., as well
as depreciation in the value of our investment in American Teleconferencing
Services, Ltd. and SOAGG, LLC, among others. Net unrealized gain for the six
months ended June 30, 2021 was primarily due to appreciation in the value our
investments in PhyMed Management LLC, Senseonics Holdings, Inc. and KBH Topco,
LLC, among others, partially offset by the reversal of previously recognized
appreciation in our investment in Genmark Diagnostics, Inc., as well as
depreciation in the value of our investment in American Teleconferencing
Services, Ltd. and SOAGG, LLC, among others.

Net increase (decrease) in net assets from operations

For the three and six months ended June 30, 2022, the Company had a net decrease
in net assets resulting from operations of $15.6 million and $14.2 million,
respectively. For the same periods, losses per average share were $0.29 and
$0.29, respectively. For the three and six months ended June 30, 2021, the
Company had a net increase in net assets resulting from operations of
$18.6 million and $40.1 million, respectively. For the same periods, earnings
per average share were $0.44 and $0.95, respectively.

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CASH AND CAPITAL RESOURCES

The Company's liquidity and capital resources are generated and generally
available through its Credit Facility and SPV Credit Facility (as defined
below), the 2022 Tranche C Notes, the 2023 Unsecured Notes, the 2024 Unsecured
Notes, the 2025 Unsecured Notes, the 2026 Unsecured Notes, the 2027 Unsecured
Notes and the 2027 Series F Unsecured Notes, through cash flows from operations,
investment sales, prepayments of senior and subordinated loans, income earned on
investments and cash equivalents, and periodic
follow-on
equity and/or debt offerings. As of June 30, 2022, we had a total of
$484.4 million of unused borrowing capacity under the Credit Facility and SPV
Credit Facility, subject to borrowing base limits.

We may from time to time issue equity and/or debt securities in either public or
private offerings. The issuance of such securities will depend on future market
conditions, funding needs and other factors and there can be no assurance that
any such issuance will occur or be successful. The primary uses of existing
funds and any funds raised in the future is expected to be for investments in
portfolio companies, repayment of indebtedness, cash distributions to our
stockholders, or for other general corporate purposes.

On April 1, 2022, we entered into an assumption agreement (the "CF Assumption
Agreement"), effective as of the closing of the Mergers. The CF Assumption
Agreement relates to our assumption of the Revolving Credit Facility, originally
entered into on August 26, 2011 (as amended from time to time, the "SPV Credit
Facility"), by and among SUNS SPV LLC (the "SUNS SPV"), a wholly-owned
subsidiary of SUNS, acting as borrower, Citibank, N.A., acting as administrative
agent and collateral agent, and the other parties thereto. Currently, the
commitment under the SPV Credit Facility is $225 million; however, the
commitment can also be expanded up to $600 million. The stated interest rate on
the SPV Credit Facility is LIBOR plus
2.00%-2.50%
with no LIBOR floor requirement and the current final maturity date is June 1,
2026. The SPV Credit Facility is secured by all of the assets held by SUNS SPV.
Under the terms of the SPV Credit Facility and related transaction documents, we
as successor to SUNS, and SUNS SPV, as applicable, have made certain customary
representations and warranties, and are required to comply with various
covenants, including leverage restrictions, reporting requirements and other
customary requirements for similar credit facilities. The SPV Credit Facility
also includes usual and customary events of default for credit facilities of
this nature.

On April 1, 2022, we entered into an assumption agreement (the "Note Assumption
Agreement"), effective as of the closing of the Mergers. The Note Assumption
Agreement relates to our assumption of $85 million in aggregate principal amount
of five-year, 3.90% senior unsecured notes, due March 31, 2025 (the "2025
Unsecured Notes") and other obligations of SUNS under the Note Purchase
Agreement, dated as of March 31, 2020 (the "Note Purchase Agreement"), among
SUNS and certain institutional investors. Interest on the 2025 Unsecured Notes
is due semi-annually on March 31 and September 30. Pursuant to the Note
Assumption Agreement, we expressly assumed on behalf of SUNS the due and
punctual payment of the principal of (and premium, if any) and interest on all
the 2025 Unsecured Notes outstanding, and the due and punctual performance and
observance of every covenant and every condition of the Note Purchase Agreement,
to be performed or observed by SUNS.

On January 6, 2022, the Company closed a private offering of $135 million of the
2027 Series F Unsecured Notes with a fixed interest rate of 3.33% and a maturity
date of January 6, 2027. Interest on the 2027 Series F Unsecured Notes is due
semi-annually on January 6 and July 6. The 2027 Series F Unsecured Notes were
issued in a private placement only to qualified institutional buyers.

On December 28, 2021, the Company closed on Amendment No. 1 to its August 28,
2019 senior secured credit agreement (the "Credit Facility"). Following the
amendment, the Credit Facility is composed of $600 million of revolving credit
and $100 million of term loans. Borrowings generally bear interest at a rate per
annum equal to the base rate plus a range of
1.75%-2.00%
or the alternate base rate plus
0.75%-1.00%.
The Credit Facility has a 0% floor and matures in December 2026 and includes
ratable amortization in the final year.

On September 14, 2021, the Company closed a private offering of $50 million of
the 2027 Unsecured Notes with a fixed interest rate of 2.95% and a maturity date
of March 14, 2027. Interest on the 2027 Unsecured Notes is due semi-annually on
March 14 and September 14. The 2027 Unsecured Notes were issued in a private
placement only to qualified institutional buyers.

On December 18, 2019, the Company closed a private offering of $125 million of
the 2024 Unsecured Notes with a fixed interest rate of 4.20% and a maturity date
of December 15, 2024. Interest on the 2024 Unsecured Notes is due semi-annually
on June 15 and December 15. The 2024 Unsecured Notes were issued in a private
placement only to qualified institutional buyers.

On December 18, 2019, the Company closed a private offering of $75 million of
the 2026 Unsecured Notes with a fixed interest rate of 4.375% and a maturity
date of December 15, 2026. Interest on the 2026 Unsecured Notes is due
semi-annually on June 15 and December 15. The 2026 Unsecured Notes were issued
in a private placement only to qualified institutional buyers.

On December 28, 2017, the Company closed a private offering of $21 million of
the 2022 Tranche C Notes with a fixed interest rate of 4.50% and a maturity date
of December 28, 2022. Interest on the 2022 Tranche C Notes is due semi-annually
on June 28 and December 28. The 2022 Tranche C Notes were issued in a private
placement only to qualified institutional buyers.

On November 22, 2017, we issued $75 million in aggregate principal amount of
publicly registered 2023 Unsecured Notes for net proceeds of $73.8 million.
Interest on the 2023 Unsecured Notes is paid semi-annually on January 20 and
July 20, at a fixed rate of 4.50% per year, commencing on January 20, 2018. The
2023 Unsecured Notes mature on January 20, 2023.

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On February 15, 2017, the Company closed a private offering of $100 million of
the 2022 Unsecured Notes with a fixed interest rate of 4.60% and a maturity date
of May 8, 2022. Interest on the 2022 Unsecured Notes is due semi-annually on
May 8 and November 8. The 2022 Unsecured Notes were issued in a private
placement only to qualified institutional buyers.

On November 8, 2016, the Company closed a private offering of $50 million of the
2022 Unsecured Notes with a fixed interest rate of 4.40% and a maturity date of
May 8, 2022. Interest on the 2022 Unsecured Notes is due semi-annually on May 8
and November 8. The 2022 Unsecured Notes were issued in a private placement only
to qualified institutional buyers. The 2022 Unsecured Notes were repaid in full
at maturity.

On January 11, 2013, the Company closed its most recent
follow-on
public equity offering of 6.3 million shares of common stock raising
approximately $146.9 million in net proceeds. The primary uses of the funds
raised were for investments in portfolio companies, reductions in revolving debt
outstanding and for other general corporate purposes.

Cash equivalents

We deem certain U.S. Treasury bills, repurchase agreements and other
high-quality, short-term debt securities as cash equivalents. The Company makes
purchases that are consistent with its purpose of making investments in
securities described in paragraphs 1 through 3 of Section 55(a) of the 1940 Act.
From time to time, including at or near the end of each fiscal quarter, we
consider using various temporary investment strategies for our business. One
strategy includes taking proactive steps by utilizing cash equivalents as
temporary assets with the objective of enhancing our investment flexibility
pursuant to Section 55 of the 1940 Act. More specifically, from
time-to-time
we may purchase U.S. Treasury bills or other high-quality, short-term debt
securities at or near the end of the quarter and typically close out the
position on a net cash basis subsequent to quarter end. We may also utilize
repurchase agreements or other balance sheet transactions, including drawing
down on the Credit Facility, as deemed appropriate. The amount of these
transactions or such drawn cash for this purpose is excluded from total assets
for purposes of computing the asset base upon which the management fee is
determined. We held approximately $350 million in cash equivalents as of
June 30, 2022.

Debt

Unsecured Notes

On April 1, 2022, we entered into the Note Assumption Agreement, effective as of
the closing of the Mergers. The Note Assumption Agreement relates to our
assumption of $85 million of the 2025 Unsecured Notes and other obligations of
SUNS under the Note Purchase Agreement, among SUNS and certain institutional
investors. Interest on the 2025 Unsecured Notes is due semi-annually on March 31
and September 30. Pursuant to the Note Assumption Agreement, we expressly
assumed on behalf of SUNS the due and punctual payment of the principal of (and
premium, if any) and interest on all the 2025 Unsecured Notes outstanding, and
the due and punctual performance and observance of every covenant and every
condition of the Note Purchase Agreement, to be performed or observed by SUNS.

On January 6, 2022, the Company closed a private offering of $135 million of the
2027 Series F Unsecured Notes with a fixed interest rate of 3.33% and a maturity
date of January 6, 2027. Interest on the 2027 Series F Unsecured Notes is due
semi-annually on January 6 and July 6. The 2027 Series F Unsecured Notes were
issued in a private placement only to qualified institutional buyers.

On September 14, 2021, the Company closed a private offering of $50 million of
the 2027 Unsecured Notes with a fixed interest rate of 2.95% and a maturity date
of March 14, 2027. Interest on the 2027 Unsecured Notes is due semi-annually on
March 14 and September 14. The 2027 Unsecured Notes were issued in a private
placement only to qualified institutional buyers.

On December 18, 2019, the Company closed a private offering of $125 million of
the 2024 Unsecured Notes with a fixed interest rate of 4.20% and a maturity date
of December 15, 2024. Interest on the 2024 Unsecured Notes is due semi-annually
on June 15 and December 15. The 2024 Unsecured Notes were issued in a private
placement only to qualified institutional buyers.

On December 18, 2019, the Company closed a private offering of $75 million of
the 2026 Unsecured Notes with a fixed interest rate of 4.375% and a maturity
date of December 15, 2026. Interest on the 2026 Unsecured Notes is due
semi-annually on June 15 and December 15. The 2026 Unsecured Notes were issued
in a private placement only to qualified institutional buyers.

On December 28, 2017, the Company closed a private offering of $21 million of
the 2022 Tranche C Notes with a fixed interest rate of 4.50% and a maturity date
of December 28, 2022. Interest on the 2022 Tranche C Notes is due semi-annually
on June 28 and December 28. The 2022 Tranche C Notes were issued in a private
placement only to qualified institutional buyers.

On November 22, 2017, we issued $75 million in aggregate principal amount of
publicly registered 2023 Unsecured Notes for net proceeds of $73.8 million.
Interest on the 2023 Unsecured Notes is paid semi-annually on January 20 and
July 20, at a fixed rate of 4.50% per year, commencing on January 20, 2018. The
2023 Unsecured Notes mature on January 20, 2023.

On February 15, 2017, the Company closed a private offering of $100 million of
the 2022 Unsecured Notes with a fixed interest rate of 4.60% and a maturity date
of May 8, 2022. Interest on the 2022 Unsecured Notes is due semi-annually on
May 8 and November 8. The 2022 Unsecured Notes were issued in a private
placement only to qualified institutional buyers.

On November 8, 2016, the Company closed a private offering of $50 million of the
2022 Unsecured Notes with a fixed interest rate of 4.40% and a maturity date of
May 8, 2022. Interest on the 2022 Unsecured Notes is due semi-annually on May 8
and

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November 8. The 2022 Unsecured Notes were issued in a private placement only to
qualified institutional buyers. The 2022 Unsecured Notes were issued in a
private placement only to qualified institutional buyers. The 2022 Unsecured
Notes were repaid in full at maturity.

Revolving and term loan facilities

On April 1, 2022, we entered into the CF Assumption Agreement, effective as of
the closing of the Mergers. The CF Assumption Agreement relates to our
assumption of the SPV Credit Facility, by and among SUNS SPV, a wholly-owned
subsidiary of SUNS, acting as borrower, Citibank, N.A., acting as administrative
agent and collateral agent, and the other parties thereto. Currently, the
commitment under the SPV Credit Facility is $225 million; however, the
commitment can also be expanded up to $600 million. The stated interest rate on
the SPV Credit Facility is LIBOR plus
2.00%-2.50%
with no LIBOR floor requirement and the current final maturity date is June 1,
2026. The SPV Credit Facility is secured by all of the assets held by SUNS SPV.
Under the terms of the SPV Credit Facility and related transaction documents, we
as successor to SUNS, and SUNS SPV, as applicable, have made certain customary
representations and warranties, and are required to comply with various
covenants, including leverage restrictions, reporting requirements and other
customary requirements for similar credit facilities. The SPV Credit Facility
also includes usual and customary events of default for credit facilities of
this nature. At June 30, 2022, outstanding USD equivalent borrowings under the
SPV Credit Facility totaled $128.6 million.

On December 28, 2021, the Company closed on Amendment No. 1 to the Credit
Facility. Following the amendment, the Credit Facility is composed of
$600 million of revolving credit and $100 million of term loans. Borrowings
generally bear interest at a rate per annum equal to the base rate plus a range
of
1.75%-2.00%
or the alternate base rate plus
0.75%-1.00%.
The Credit Facility has a 0% floor and matures in December 2026 and includes
ratable amortization in the final year. The Credit Facility may be increased up
to $800 million with additional new lenders or an increase in commitments from
current lenders. The Credit Facility contains certain customary affirmative and
negative covenants and events of default. In addition, the Credit Facility
contains certain financial covenants that among other things, requires the
Company to maintain a minimum shareholder's equity and a minimum asset coverage
ratio. At June 30, 2022, outstanding USD equivalent borrowings under the Credit
Facility totaled $312.0 million, composed of $212.0 million of revolving credit
and $100.0 million of term loans.

Certain covenants on our issued debt may restrict our business activities,
including limitations that could hinder our ability to finance additional loans
and investments or to make the distributions required to maintain our status as
a RIC under Subchapter M of the Code. At June 30, 2022, the Company was in
compliance with all financial and operational covenants required by the Debt
Instruments.

Contractual Obligations

A summary of our significant contractual payment obligations is as follows as of
June 30, 2022:

                      Payments Due by Period (in millions)

                                                      Less than                                      More Than
                                          Total        1 Year         1-3 Years       3-5 Years       5 Years
Revolving credit facilities (1)          $ 340.6     $        -      $        -      $     340.6     $       -
Unsecured senior notes                     566.0            96.0           210.0           260.0             -
Term loans                                 100.0              -               -            100.0             -

(1) From June 30, 2022we had a total of $484.4 million unused loans

capacity under our revolving credit facilities, subject to borrowing base

limits.

Under the provisions of the 1940 Act, we are permitted, as a BDC, to issue
senior securities in amounts such that our asset coverage ratio, as defined in
the 1940 Act, equals at least 150% of gross assets less all liabilities and
indebtedness not represented by senior securities, after each issuance of senior
securities. If the value of our assets declines, we may be unable to satisfy the
asset coverage test. If that happens, we may be required to sell a portion of
our investments and, depending on the nature of our leverage, repay a portion of
our indebtedness at a time when such sales may be disadvantageous. Also, any
amounts that we use to service our indebtedness would not be available for
distributions to our common stockholders. Furthermore, as a result of issuing
senior securities, we would also be exposed to typical risks associated with
leverage, including an increased risk of loss.

We have also entered into two contracts under which we have future commitments:
the Advisory Agreement, pursuant to which the Investment Adviser has agreed to
serve as our investment adviser, and the Administration Agreement, pursuant to
which the Administrator has agreed to furnish us with the facilities and
administrative services necessary to conduct our
day-to-day
operations and provide on our behalf managerial assistance to those portfolio
companies to which we are required to provide such assistance. Payments under
the Advisory Agreement are equal to (1) a percentage of the value of our average
gross assets and (2) a
two-part
incentive fee. Payments under the Administration Agreement are equal to an
amount based upon our allocable portion of the Administrator's overhead in
performing its obligations under the Administration Agreement, including rent,
technology systems, insurance and our allocable portion of the costs of our
chief financial officer and chief compliance officer and their respective
staffs. Either party may terminate each of the Advisory Agreement and
administration agreement without penalty upon 60 days' written notice to the
other. See note 3 to our Consolidated Financial Statements.

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On July 31, 2017, the Company, NEFPASS LLC and NEFCORP LLC entered into a
servicing agreement. NEFCORP LLC was engaged to provide NEFPASS LLC with
administrative services related to the loans and capital leases held by NEFPASS
LLC. NEFPASS LLC may terminate this agreement upon 30 days' written notice to
NEFCORP LLC.

Senior Securities

Information about our senior securities is shown in the following table (in
thousands) as of the quarter ended June 30, 2022 and each year ended December 31
for the past ten years, unless otherwise noted. The "-" indicates information
which the SEC expressly does not require to be disclosed for certain types of
senior securities.

                                                                                    Involuntary
                                                                   Asset            Liquidating           Average
                                          Total Amount           Coverage           Preference         Market Value
Class and Year                           Outstanding(1)         Per Unit(2)         Per Unit(3)         Per Unit(4)
Credit Facility
Fiscal 2022 (through June 30, 2022)     $        212,000       $         423                  -                  N/A
Fiscal 2021                                      222,500                 552                  -                  N/A
Fiscal 2020                                      126,000                 421                  -                  N/A
Fiscal 2019                                       42,900                 182                  -                  N/A
Fiscal 2018                                       96,400                 593                  -                  N/A
Fiscal 2017                                      245,600               1,225                  -                  N/A
Fiscal 2016                                      115,200                 990                  -                  N/A
Fiscal 2015                                      207,900               1,459                  -                  N/A
Fiscal 2014                                           -                   -                   -                  N/A
Fiscal 2013                                           -                   -                   -                  N/A
Fiscal 2012                                      264,452               1,510                  -                  N/A
SPV Credit Facility
Fiscal 2022 (through June 30, 2022)              128,600                 256                  -                  N/A
2022 Unsecured Notes
Fiscal 2022 (through June 30, 2022)                   -                   -                   -                  N/A
Fiscal 2021                                      150,000                 372                  -                  N/A
Fiscal 2020                                      150,000                 501                  -                  N/A
Fiscal 2019                                      150,000                 638                  -                  N/A
Fiscal 2018                                      150,000                 923                  -                  N/A
Fiscal 2017                                      150,000                 748                  -                  N/A
Fiscal 2016                                       50,000                 430                  -                  N/A
2022 Tranche C Notes
Fiscal 2022 (through June 30, 2022)               21,000                  42                  -                  N/A
Fiscal 2021                                       21,000                  52                  -                  N/A
Fiscal 2020                                       21,000                  70                  -                  N/A
Fiscal 2019                                       21,000                  89                  -                  N/A
Fiscal 2018                                       21,000                 129                  -                  N/A
Fiscal 2017                                       21,000                 105                  -                  N/A
2023 Unsecured Notes
Fiscal 2022 (through June 30, 2022)               75,000                 150                  -                  N/A
Fiscal 2021                                       75,000                 186                  -                  N/A
Fiscal 2020                                       75,000                 250                  -                  N/A
Fiscal 2019                                       75,000                 319                  -                  N/A
Fiscal 2018                                       75,000                 461                  -                  N/A
Fiscal 2017                                       75,000                 374                  -                  N/A
2024 Unsecured Notes
Fiscal 2022 (through June 30, 2022)              125,000                 249                  -                  N/A
Fiscal 2021                                      125,000                 309                  -                  N/A
Fiscal 2020                                      125,000                 417                  -                  N/A
Fiscal 2019                                      125,000                 531                  -                  N/A
2025 Unsecured Notes
Fiscal 2022 (through June 30, 2022)               85,000                 170                  -                  N/A
2026 Unsecured Notes



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                                                                                    Involuntary
                                                                   Asset            Liquidating           Average
                                          Total Amount           Coverage           Preference         Market Value
Class and Year                           Outstanding(1)         Per Unit(2)         Per Unit(3)         Per Unit(4)
Fiscal 2022 (through June 30, 2022)               75,000                 150                  -                  N/A
Fiscal 2021                                       75,000                 186                  -                  N/A
Fiscal 2020                                       75,000                 250                  -                  N/A
Fiscal 2019                                       75,000                 319                  -                  N/A
2027 Unsecured Notes
Fiscal 2022 (through June 30, 2022)               50,000                 100                  -                  N/A
Fiscal 2021                                       50,000                 124                  -                  N/A
2027 Series F Unsecured Notes
Fiscal 2022 (through June 30, 2022)              135,000                 269                  -                  N/A
2042 Unsecured Notes
Fiscal 2017                                           -                   -                   -                  N/A
Fiscal 2016                                      100,000                 859                  -        $       1,002
Fiscal 2015                                      100,000                 702                  -                  982
Fiscal 2014                                      100,000               2,294                  -                  943
Fiscal 2013                                      100,000               2,411                  -                  934
Fiscal 2012                                      100,000                 571                  -                  923
Senior Secured Notes
Fiscal 2017                                           -                   -                   -                  N/A
Fiscal 2016                                       75,000                 645                  -                  N/A
Fiscal 2015                                       75,000                 527                  -                  N/A
Fiscal 2014                                       75,000               1,721                  -                  N/A
Fiscal 2013                                       75,000               1,808                  -                  N/A
Fiscal 2012                                       75,000                 428                  -                  N/A
Term Loans
Fiscal 2022 (through June 30, 2022)              100,000                 199                  -                  N/A
Fiscal 2021                                      100,000                 248                  -                  N/A
Fiscal 2020                                       75,000                 250                  -                  N/A
Fiscal 2019                                       75,000                 319                  -                  N/A
Fiscal 2018                                       50,000                 308                  -                  N/A
Fiscal 2017                                       50,000                 250                  -                  N/A
Fiscal 2016                                       50,000                 430                  -                  N/A
Fiscal 2015                                       50,000                 351                  -                  N/A
Fiscal 2014                                       50,000               1,147                  -                  N/A
Fiscal 2013                                       50,000               1,206                  -                  N/A
Fiscal 2012                                       50,000                 285                  -                  N/A
NEFPASS Facility
Fiscal 2021                                           -                   -                   -                  N/A
Fiscal 2020                                       30,000                 100                  -                  N/A
Fiscal 2019                                       30,000                 128                  -                  N/A
Fiscal 2018                                       30,000                 185                  -                  N/A
SSLP Facility
Fiscal 2019                                           -                   -                   -                  N/A
Fiscal 2018                                       53,785                 331                  -                  N/A
Total Senior Securities
Fiscal 2022 (through June 30, 2022)     $      1,006,600       $       2,008                  -                  N/A
Fiscal 2021                                      818,500               2,029                  -                  N/A
Fiscal 2020                                      677,000               2,259                  -                  N/A
Fiscal 2019                                      593,900               2,525                  -                  N/A
Fiscal 2018                                      476,185               2,930                  -                  N/A
Fiscal 2017                                      541,600               2,702                  -                  N/A
Fiscal 2016                                      390,200               3,354                  -                  N/A
Fiscal 2015                                      432,900               3,039                  -                  N/A
Fiscal 2014                                      225,000               5,162                  -                  N/A
Fiscal 2013                                      225,000               5,425                  -                  N/A
Fiscal 2012                                      489,452               2,794                  -                  N/A

(1) Total amount of each class of senior securities outstanding (in thousands) at

    the end of the period presented.



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(2) The asset coverage ratio for a class of senior securities representing

Indebtedness is our total consolidated assets less any

liabilities and debts not represented by senior securities, divided by

all senior debt securities. This asset coverage ratio is

multiplied by one thousand to determine the asset coverage per unit. In order

to determine the specific asset coverage per unit for each category of debt, the

total asset coverage per unit is assigned based on the amount outstanding

each category of debt at the end of the period. From June 30, 2022asset

coverage was 200.8%.

(3) The amount to which such class of Senior Securities would be entitled to

involuntary liquidation of the issuer in preference to any security below

this.

(4) Not applicable except for 2042 Unsecured Notes which have been publicly

negotiated. The average market value per unit is calculated by taking the

average closing price during the period and dividing it by twenty-five

dollars per share and multiplying the result by one thousand to determine a

unit price per thousand consistent with asset coverage per unit. The average

the market value for the financial years 2016, 2015, 2014, 2013 and 2012 was

$100,175, $98,196, $94,301, $93,392and $92,302respectively.

Off-Balance
Sheet Arrangements

From
time-to-time
and in the normal course of business, the Company may make unfunded capital
commitments to current or prospective portfolio companies. Typically, the
Company may agree to provide delayed-draw term loans or, to a lesser extent,
revolving loan or equity commitments. These unfunded capital commitments always
take into account the Company's liquidity and cash available for investment,
portfolio and issuer diversification, and other considerations. Accordingly, the
Company had the following unfunded capital commitments at June 30, 2022 and
December 31, 2021, respectively:

                                                     June 30,      December 31,
                                                       2022            2021
(in millions)
Arcutis Biotherapeutics, Inc                        $     50.1     $        43.5
SLR Credit Solutions*                                     44.3              44.3
World Insurance Associates, LLC                           33.3                -
Apeel Technology, Inc                                     32.8                -
Glooko, Inc                                               29.8              25.1
CC SAG Holdings Corp. (Spectrum Automotive)..             24.3              18.8
Human Interest, Inc                                       20.1                -
Atria Wealth Solutions, Inc                               11.6               3.7
RSC Acquisition, Inc                                      10.6                -
BridgeBio Pharma, Inc                                      9.0              23.0
Vapotherm, Inc                                             8.6                -
Peter C. Foy & Associates Insurance Services, LLC          8.6                -
Inszone Mid, LLC                                           7.9              12.5
Ardelyx, Inc                                               7.8                -
Maurices, Incorporated                                     6.0               5.7
RQM+ Corp                                                  5.1               3.8
Ivy Fertility Services, LLC                                4.9               4.5
Vessco Midco Holdings, LLC                                 4.4                -
NAC Holdings Corporation                                   4.3               4.8
OIS Management Services, LLC                               4.0                -
One Touch Direct, LLC                                      4.0               7.2
Kaseya, Inc                                                3.9                -
Foundation Consumer Brands, LLC                            3.0              

2.3

Plastics Management, LLC                                   2.8              

–

Southern Orthodontic Partners Management, LLC              2.8                -
Kid Distro Holdings, LLC                                   2.7               2.7
MMIT Holdings, LLC                                         2.3               2.0
Basic Fun, Inc                                             2.3               1.9
Enverus Holdings, Inc                                      1.4                -
SLR Healthcare ABL*                                        1.4                -
RxSense Holdings LLC                                       1.2                -
Erie Construction
Mid-west,
LLC                                                        1.2                -
SLR Equipment Finance                                      1.0               5.0
All State Ag Parts, LLC                                    0.9                -
American Teleconferencing Services, Ltd                    0.9              

0.6

Ultimate Baked Goods Midco LLC                             0.8              

0.8

SunMed Group Holdings, LLC                                 0.8              

0.8

Composite Technology Acquisition Corp                      0.6              

–

Pinnacle Treatment Centers, Inc                            0.5               1.4
GSM Acquisition Corp                                       0.5                -
BayMark Health Services, Inc                               0.5                -
High Street Buyer, Inc                                     0.3                -
Tilley Distribution, Inc                                   0.3                -
TAUC Management, LLC                                       0.3                -
Rezolute, Inc                                               -                5.7
SOC Telemed, Inc                                            -                4.4
Neuronetics, Inc                                            -                2.2

Total Commitments                                   $    363.9     $       226.7




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* The Company controls the financing of SLR Credit Solutions and SLR Healthcare

commitments and may cancel them at its discretion.

The credit agreements of the above loan commitments contain customary lending
provisions and/or are subject to the portfolio company's achievement of certain
milestones that allow relief to the Company from funding obligations for
previously made commitments in instances where the underlying company
experiences materially adverse events that affect the financial condition or
business outlook for the company. Since these commitments may expire without
being drawn upon, unfunded commitments do not necessarily represent future cash
requirements or future earning assets for the Company. As of June 30, 2022 and
December 31, 2021, the Company had sufficient cash available and/or liquid
securities available to fund its commitments and had reviewed them for any
appropriate fair value adjustment.

In the normal course of its business, we invest or trade in various financial
instruments and may enter into various investment activities with
off-balance
sheet risk, which may include forward foreign currency contracts. Generally,
these financial instruments represent future commitments to purchase or sell
other financial instruments at specific terms at future dates. These financial
instruments contain varying degrees of
off-balance
sheet risk whereby changes in the market value or our satisfaction of the
obligations may exceed the amount recognized in our Consolidated Statements of
Assets and Liabilities.

Distributions

The following table reflects the cash distributions per share on our common
stock for the two most recent fiscal years and the current fiscal year to date:

Date Declared           Record Date             Payment Date           Amount
Fiscal 2022
August 2, 2022           August 18, 2022       September 1, 2022     $ 0.136667
July 6, 2022               July 21, 2022          August 2, 2022       0.136667
June 3, 2022               June 23, 2022            July 5, 2022       0.136667
May 3, 2022                 May 19, 2022            June 2, 2022       0.136667
April 4, 2022             April 21, 2022             May 3, 2022       0.136667
March 1, 2022             March 18, 2022           April 1, 2022           0.41

Total 2022                                                           $ 1.093335

Fiscal 2021
November 3, 2021       December 16, 2021         January 5, 2022     $     0.41
August 3, 2021        September 23, 2021         October 5, 2021           0.41
May 5, 2021                June 23, 2021            July 2, 2021           0.41
February 24, 2021         March 18, 2021           April 2, 2021           0.41

Total 2021                                                           $     1.64

Fiscal 2020
November 5, 2020       December 17, 2020         January 5, 2021     $     0.41
August 4, 2020        September 17, 2020         October 2, 2020           0.41
May 7, 2020                June 18, 2020            July 2, 2020           0.41
February 20, 2020         March 19, 2020           April 3, 2020           0.41

Total 2020                                                           $     1.64



Tax characteristics of all distributions will be reported to stockholders on
Form 1099 after the end of the calendar year. Future quarterly distributions, if
any, will be determined by the Board. We expect that our distributions to
stockholders will generally be from accumulated net investment income, from net
realized capital gains or
non-taxable
return of capital, if any, as applicable.

We have elected to be taxed as a RIC under Subchapter M of the Code. To maintain
our RIC tax treatment, we must distribute at least 90% of our ordinary income
and realized net short-term capital gains in excess of realized net long-term
capital losses, if any, out of the assets legally available for distribution. In
addition, although we currently intend to distribute realized net capital gains
(
i.e.
, net long-term capital gains in excess of short-term capital losses), if any,
at least annually, out of the assets legally available for such distributions,
we may in the future decide to retain such capital gains for investment.

We maintain an "opt out" dividend reinvestment plan for our common stockholders.
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.

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We may not be able to achieve operating results that will allow us to make
distributions at a specific level or to increase the amount of these
distributions from time to time. In addition, due to the asset coverage test
applicable to us as a business development company, we may in the future be
limited in our ability to make distributions. Also, the Credit Facility may
limit our ability to declare distributions if we default under certain
provisions. If we do not distribute a certain percentage of our income annually,
we will suffer adverse tax consequences, including possible loss of the tax
benefits available to us as a regulated investment company. In addition, in
accordance with GAAP and tax regulations, we include in income certain amounts
that we have not yet received in cash, such as contractual
payment-in-kind
income, which represents contractual income added to the loan balance that
becomes due at the end of the loan term, or the accrual of original issue or
market discount. Since we may recognize income before or without receiving cash
representing such income, we may have difficulty meeting the requirement to
distribute at least 90% of our investment company taxable income to obtain tax
benefits as a regulated investment company.

With respect to distributions to shareholders, income from origination, structuring, closing and certain other up-front costs associated with holding company investments is treated as taxable income and therefore distributed to shareholders.

Related parties

We have established a number of business relationships with affiliated or related parties, including the following:

• We have entered into the Advisory Agreement with the Investment Advisor.

          Mr. Gross, our Chairman,
          Co-Chief
          Executive Officer and President and Mr. Spohler, our
          Co-Chief

Executive Officer, Chief Operating Officer and member of the Board of Directors, manage

members and senior investment professionals of, and have finance and

          controlling interests in, the Investment Adviser. In addition,
          Mr. Peteka, our Chief Financial Officer, Treasurer and Secretary serves
          as the Chief Financial Officer for the Investment Adviser.



     •    The Administrator provides us with the office facilities and
          administrative services necessary to conduct
          day-to-day
          operations pursuant to our Administration Agreement. We reimburse the

Administrator for the attributable portion of overhead and other expenses

incurred by him in the performance of his obligations under the Administration

Agreement, including rent, fees and expenses associated with

performing compliance functions, and the compensation of our head

compliance officer, our chief financial officer and their

          staffs.



     •    We have entered into a license agreement with the Investment Adviser,
          pursuant to which the Investment Adviser has granted us a
          non-exclusive,
          royalty-free license to use the licensed marks "SOLAR" and "SLR".


The Investment Adviser may also manage other funds in the future that may have
investment mandates that are similar, in whole and in part, with ours. For
example, the Investment Adviser presently serves as investment adviser to SCP
Private Credit Income BDC LLC, an unlisted BDC that focuses on investing
primarily in senior secured loans, including
non-traditional
asset-based loans and first lien loans and SLR HC BDC LLC, an unlisted BDC whose
principal focus is to invest directly and indirectly in senior secured loans and
other debt instruments typically to middle market companies within the
healthcare industry. In addition, Michael S. Gross, our Chairman,
Co-Chief
Executive Officer and President, Bruce Spohler, our
Co-Chief
Executive Officer and Chief Operating Officer, and Richard L. Peteka, our Chief
Financial Officer, serve in similar capacities for SCP Private Credit Income BDC
LLC and SLR HC BDC LLC. The Investment Adviser and certain investment advisory
affiliates may determine that an investment is appropriate for us and for one or
more of those other funds. In such event, depending on the availability of such
investment and other appropriate factors, the Investment Adviser or its
affiliates may determine that we should invest
side-by-side
with one or more other funds. Any such investments will be made only to the
extent permitted by applicable law and interpretive positions of the SEC and its
staff, and consistent with the Investment Adviser's allocation procedures. On
June 13, 2017, the Adviser received an exemptive order that permits the Company
to participate in
negotiated co-investment transactions
with certain affiliates, in a manner consistent with the Company's investment
objective, positions, policies, strategies and restrictions as well as
regulatory requirements and other pertinent factors, and pursuant to various
conditions (the "Order"). If the Company is unable to rely on the Order for a
particular opportunity, such opportunity will be allocated first to the entity
whose investment strategy is the most consistent with the opportunity being
allocated, and second, if the terms of the opportunity are consistent with more
than one entity's investment strategy, on an alternating basis. Although the
Adviser's investment professionals will endeavor to allocate investment
opportunities in a fair and equitable manner, the Company and its stockholders
could be adversely affected to the extent investment opportunities are allocated
among us and other investment vehicles managed or sponsored by, or affiliated
with, our executive officers, directors and members of the Adviser.

Related party transactions may occur among us, SLR Credit, Equipment Operating
Leases LLC, KBH, Loyer Capital LLC, SLR Business Credit, SLR Healthcare ABL and
SLR Equipment. These transactions may occur in the normal course of business. No
administrative or other fees are paid to the Investment Adviser by SLR Credit,
Equipment Operating Leases LLC, KBH, Loyer Capital LLC, SLR Business Credit, SLR
Healthcare ABL or SLR Equipment.

In addition, we have adopted a formal code of ethics that governs the conduct of
our officers and directors. Our officers and directors also remain subject to
the duties imposed by both the 1940 Act and the Maryland General Corporation
Law.

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