Christian Oberbeck: Sure. I think that, again, that — as we answered the last question, that’s something we think about, talk about continuously. I think also just going back to consistent theme on this call and all of our prior calls is that we tend not to forecast and project what our deployment is going to be against any kind of goal per se. We try and address each opportunity as it comes. And as you can see in the last quarter, we declined to make further new platform investments. That wasn’t driven by any broader sort of metrics that we’re operating to, but it really was sort of on a case-by-case basis us not seeing the risk-reward situation fitting within what we felt it should fit in with it. And we will continue that going forward.
So, we really — it’s possible we may see some tremendously opportunistic deals coming our way, in which case, we will be favorably inclined then. But we’re going to be judicious and prudent as we said about how we deploy relative to sort of everything. Obviously, leverage is a factor and opportunity is a factor and credit quality is a factor. So again, it’s difficult for us to ask — answer that question for you prospectively because it’s going to be a function of the opportunities that are presented or that we generate for ourselves.
Robert Dodd: Got it. Thank you. I think that actually is pretty clear. I appreciate that. On the two — I do want to ask a couple of questions on Zollege and Netreo. So, on Zollege, was there any negotiation with the sponsor as to whether to not pay or to potentially pick the interest? If this is a transitory cost issue you believe is fixable, wouldn’t it — was a PIK toggle considered as option, not that I’m saying in paper, but the straight to not paying in when PIK has been increasing across the industry, there’s more and more of it, it wouldn’t have stood out that much if you’ve done it. Can you just give us any thoughts on why that either didn’t come up in view or was rejected?
Michael Grisius: Well, we’re — it’s a good question. We’re continuing to work with the sponsor and the management team in terms of one, focusing on improved performance this year and then the general direction that the business is going to go. It’s interesting, if we were to convert to a PIK toggle, let’s say, in that case, typically, that kind of discussion becomes one where you’re agreeing to not get paid your interest, and you’re hoping to get something in exchange for it. I think our view is that, at this point, that interest is due. So it’s — from a legal perspective, the interest is accruing legally, not from an accounting perspective because they’re not paying on a current basis. But that interest is still due to us.
If we were to convert to — in any of these negotiations, if we were to convert to a PIK toggle, you’re sort of saying to the sponsor, it’s okay not to pay us and we’re fine with that. Given all the circumstances here and the fact that we’re not being paid, we prefer to be in a position where kind of we own a default, if you will, and it allows us to negotiate kind of the course of action from a better position of strength at this juncture.
Robert Dodd: Got it. Appreciate that. And then, on Netreo, I mean, if we look back two years ago, the asset was marked well above cost across all the security tranches, and you’ve put in additional capital a couple of times since then. And it seems like it’s been on a gradual valuation deterioration from where it was two years ago. So, it just — it looks like today, it’s not performing how you thought it would, but with a pretty long — prolonged period and it’s been gradual deterioration. I mean, what’s in the works to fix that? I mean I understand your comments, you think the equity market is primarily comps and performance. But it’s been, I think, 25% of your unrealized depreciation over the last two years, that one asset. The NAV performance would have been noticeably better if this asset has been performing better. So, what is it that’s the problem that still doesn’t seem to have been resolved over a couple of years?
Michael Grisius: I’ll try to be careful in terms of what we…
Robert Dodd: I realize this is a sponsor investment and you don’t want to say too much, but anything you can would be appreciated.
Michael Grisius: Sure. So, if you think about valuation of this business, and we have a material component of the equity here, a lot of the driver of the value of a business like this is the rate of growth and then there’s also just macro multiples that affect the value in general. In this case, it’s not that the business’ performance has deteriorated in a really meaningful way, but they have faced growth challenges. So, for a business where a lot of that value driver is dependent upon continued growth, when that growth gets dialed back, the valuation multiple has to come in, unfortunately. And that’s what we’ve experienced here. When you couple that with an overall decline in valuation multiples in the macro environment, the combination of those things has caused the value to come down.
So, we’re obviously very disappointed because we were quite excited about the appreciation that we’re experiencing in this asset. We think that the primary volatility around it is in the equity, of course, but — and the vast majority of our capital is in the debt.
