Tanner Powell: Thanks for the question, Paul. I’d make a couple of comments to address your questions there. First of which we are not changing our leverage guidance. I think consistent with what we said, what we have said, is you saw pick up a activity and notably we saw a number of refinancings in Q4 that served to take us into the 1-3-4 range relative to the 1-4 that we operated at, on last quarter. So there’s no update to our leverage guidance. The second point and consistent, with what we said last quarter and you alluded to there, Paul, is that should the mergers be successful, or should we be successful in executing, the mergers day one, you would see a decrease in leverage. And would guide people, to the statements that we made in connection with the last range earnings release and investor presentation there.
And I think as it relates to, I think the heart of your question is, has our outlook changed based on the spread environment? And I would say no. I mean all things being equal, you’d rather the market be giving us the [L635 to 700] that we saw early in the year, but there’s going to be ebbs and flows in spread. And I would also call your attention, to the fact that part of this, spread compression is obviously linked to a more, healthy outlook for the economy itself. And so on this account, given those ebbs and flows and spreads, would not anticipate any different approach, in managing the mergers, should we be successful in consummating those acquisitions.
Paul Johnson: Thank you. That’s all for me.
Operator: Thank you. Our next question comes from Arren Cyganovich with Citi. Please go ahead.
Arren Cyganovich: Thanks. You mentioned that the amendment fee activity, or the amendment activity hasn’t really picked up, but it was highlighted in some other than increase in your other income this quarter. You can touch on that, and then on the prepayment side it is still, I think you said between, dividend income and the other income. What will come is the geography of the change there, from including dividend income versus other income?
Tanner Powell: So, I’ll talk to amendment activity and maybe Greg can jump in is. I think that, we have not seen a material uptick in amendment activity. I think as Ted alluded to, all things being equal, should this current rate environment continue. And given the coverage ratios, you would expect it to get tighter and would not be surprising to see an uptick in amendment activity. Where we are seeing activity, we are utilizing that seat at the table, if you will, to be risk. The emphasis kind of on the continuum, is to try to invite further capital. We are less concerned with repricing than we are our de-risking. And then in terms of other income, and I’ll invite Greg to comment as well, that itself, is linked to prepayments where we get acceleration of OIDs as well as also in the instance wherein, we’re doing add-ons.
And this is another important point that, we alluded to in the prepare remarks. It’s worth emphasizing. It’s 45% of our deployment in the quarter, was related to existing commitments. Some of which is existing delay draws that, are drawn down on, but other of which is incremental commitments to existing borrowers. And that’s important for two reasons. One of, which is that can come with incremental fees, which may explain the dynamic, you’re looking at there too. But also importantly, I’ll use the word ballast again. It’s a ballast within the current market environment, because all things being equal, those existing commitments and the friction costs that, would be suffered to the extent that a sponsor, or borrower may look to refinance, the entire company enables us to get better on average pricing, and is one of the dynamics kind of, this benefit of incumbency that, we talk a lot about, and our peers talk a lot about as well.
Ted McNulty: Before we end, Greg, I’d just throw out. So, Arren, the actual number of amendments this quarter was one less than the prior quarter. And some of those were, as Tanner was alluding to, to do additional acquisitions, refinancing, et cetera. And so that’s the activity level and some of, which generated some fees.
Gregory Hunt: And I think Tanner answered the composition of on, our other income, it’s based on same double quarter-over-quarter, and then our dividend income is primarily related to our investment in U.S. auto. And we take part of the proceeds we receive every quarter, to principal and then we take some of it to dividend income.
Arren Cyganovich: Okay. Thank you. And then just lastly real quickly, the timing of the merger changed often [indiscernible]?
Gregory Hunt: I think as we’ve – I said previously, we are in the final stages of our comments with the SEC on our N14, and we’ll be making progress in the near future.
Arren Cyganovich: Okay. Thank you.
Operator: I show no further questions at this time. I will now turn the call back to management for any additional or closing remarks.
Tanner Powell: Thank you, operator. Thank you everyone for listening to today’s call. On behalf of the entire team, we thank you for your time today. Please feel free to reach out to us, if you have any other questions. Have a good day.
Operator: This does conclude today’s MidCap Financial Investment Corporation earnings conference call. You may disconnect your line at this time, and have a wonderful day.
