Patrick Schafer: Yeah. And Deepak, taking some of your portfolio questions. So I’ll hit a couple of them and apologize if I don’t get all of them, since you listed a couple issues, you can’t necessarily remember them all. But starting at the end, LB Holdco, that was actually a restructuring of a position we had in Lucky Bucks. The company emerged from bankruptcy and we received debt and equity as part of a take back. So that’s just kind of a restructuring in the quarter. Northeast Metal Works, I think, is dates back to Q2. It was a legacy Harvest Capital age cap portfolio. We actually did a refinancing with the company where we brought in another lender, reduced our exposure and sort of put in place a new facility. So that’s really just kind of like a, again, I’d call it a refinancing, but shows up as different securities kind of brought in another person, reduced exposure there.
On to your three new borrowers. Again, just to give you kind of a bit of a flavor. Tactical Air, it’s a defense business. They have two main segments. One is they actually work with the Air Force and the Navy to retrofit kind of older airplanes with their like weapon systems and cockpit technology and things like that. So that’s one part of the business. And then — and they’re kind of one of the only folks that do that. And then the other part of the business is they actually, I forget the name of the — technical name of the segment, but they do what’s called like the Red Team. So they actually, their team, they have pilots and airplanes, and they actually kind of train and help with training exercises for the Navy and the Air Force, essentially acting as sort of the quote-unquote enemy combatants for kind of training simulations.
So pretty good defensive business, secured by pretty stable contracts. We really like that business. Morae, and we did a first-lien term loan there. Morae Global Corporation actually provides, it’s a tech-enabled business that provides like legal solutions and consulting services. So a lot of what they do is around software implementation and ongoing maintenance for Fortune 500 companies within their kind of compliance and legal departments to help manage various different work streams between general legal paperwork, as well as litigation and lawsuits and discovery. And again, it’s a fairly large gamut of things that they support Fortune 500 companies with. That particular transaction, we actually — it was — the company was making an acquisition in a different jurisdiction and we structured a first-lien loan with some warrants attached to it as well that we think is a pretty attractive overall investment and security.
And then CineMedia, which would be the last one, that was a refinancing of an existing portfolio company of a large European private equity firm. It’s a U.S. business, but it’s a European private equity firm owns it. They do a couple of different things around sort of, I’ll call it, like video services and technology. So part of what they do is they actually — they have like — it is their like cards and software that go into set-top boxes for kind of traditional broadcast technology. So you can think mostly in kind of Europe where you have sort of Sky TV, SIM cards and things like that. That’s a piece of their business. They also do — they work with content providers to help them deliver their video and streams sort of between, call it, like a Netflix and sort of the internet provider who’s sort of piping into your homes.
And then, lastly, they actually — they also work with video streaming in a different area, but they help with ad targeting, content performance within applications and apps, and sort of broadband management — broadband device management, and things like that. It’s a fairly diverse set of revenue streams. Again, we’re a senior secured first-line loan, again, that’s priced at 7.75% and 96.5% [ph]. So again, that’s just kind of a flavor of that and if you just kind of think about that at a higher level, we’ve got a defense business and two business services that we’re kind of adding, which we feel like are pretty attractive industries. And then Ted already alluded to it, but I did hit an automotive supplier, which we would have no intention of getting back into that industry.
Deepak Sarpangal: That all sounds great. Yeah. I mean, I certainly recognize that you already have most of your investments in business services, high-tech industries and healthcare and pharma, but seems like kind of a continued progression, even more along that direction, which seems great. And then just a quick follow-up, I don’t have the details on the Lucky Bucks thing, but I had read something about how the company was — they’re suing or in litigation with the former promoter of that business for a pretty big number. Is that something that could be interesting upside or is it kind of immaterial given the size of your equity stake there?
Patrick Schafer: I would not say it’s immaterial, but what I would say, in general is, look, it’s public, so I can talk to some extent on it, but it’s — I would say that the facts look pretty persuasive, but you kind of never know when you get involved in litigation. So I would say, it feels pretty interesting to us, obviously, to be pursuing, but I would — again, I would say, that that’s not kind of really baked into how we think about the equity position there. So, again, you can kind of take that for what it’s worth, but I — if you kind of read through the lawsuit, I’d say the facts are candidly pretty overwhelming, but having said that, like, legal, I wouldn’t want to handicap a legal process.
