Sajal Srivastava: Yes. Casey, this is Sage. I’ll take it. So I would say to the extent that there was concern, those companies would be on our credit watch list today, we wouldn’t wait for the future event. But I would say, again, and Chris, you can correct me wrong. I mean I think a fair amount of that is natural amortization that’s coming. So these aren’t necessarily bullet payments of the few companies that may or may not have a bullet payment in Q1 or Q2, I think it’s on a case-by-case basis. But I would just say, as we look to Q1, it’s — sorry, Q4 and Q1, it’s mostly natural amortization.
Casey Alexander: Meaning monthly principal payments as opposed to a lump sum final maturity.
Sajal Srivastava: And then I would say, just generally speaking, when it comes to extensions, it’s on a fact and circumstance basis of extending maturity dates depending on the credit situation and credit rating and cash runway the company.
Casey Alexander: Okay. Great. Now when I look at this quarter’s activity with $20 million of scheduled principal amortization, that seems like a high amount, were there’s some bullet payments in there?
Sajal Srivastava: We take a look, I think during the quarter — I mean, it was $70 million of the cash we had, we had $30 million of, $30 million to $40 million of prepays, right, Chris. We had repaid on revolvers. Again, is another component of the cash that we saw. And then portfolio amortization. I don’t know if you had the detail…
Christopher Mathieu: Right. I’m looking at the $20 million specifically stated as scheduled principal amortization. And that seems like a large amount. So I’m trying to understand if there was any bullet maturities in that as to — there was…
James Labe: There was one representing $12 million.
Operator: Our next question comes from Brian McCann [ph] with JMP Securities.
Unidentified Analyst: So I appreciate the outlook commentary heading into next year. But if 2024 doesn’t play out as expected and the recovery across the industry has pushed out even further. What’s the expectation for portfolio performance, specifically as it relates to nonaccruals and just underlying credit quality? And then what might that mean for the trajectory of leverage?
Sajal Srivastava: Yes. unfortunate again, with a crystal ball, I don’t want to be joking here. Obviously, we take it quarter-to-quarter, we take in fact in circumstances. And I would say the good news is as we look to our higher-rated credit score companies that have significant amount of cash runway to make it through 2024 and beyond. So I would say that’s one element. I’d say the second — so existing cash runway continues to be strong for our top 2 rated credit watch list companies. I’d say the second element is despite the depressed market, again, as we talked about, our portfolio companies are raising new rounds of financing with one already here in Q4 of $30 million, a second one happening imminently and more underway.
So I think, again, we feel our remaining our top 2 rated portfolio companies are attracting follow-on capital they have earlier this year. We believe that they’re doing so here in Q4 and Q1. And then I do think, again, it’s — we’re seeing sectors that continue to attract strategic interest equity interest. I don’t want to say AI, for example, everything and anything with Aon and get funded are acquired today. So I’d say that’s a more balanced outlook. I can’t really comment on 2024 other than, yes, if our goal is to delever by virtue of the scheduled amortization, I think we see upside from portfolio company prepayments. Again, we talked about how challenging Q3 was for the entire venture capital ecosystem. And we had one of our highest levels of portfolio company prepaying liquidity of $70 million of cash generated in the third quarter.
So again, I don’t want to say during really tough quarters, we should expect that kind of cash generation. But I would say, again, it’s not all doom and gloom to the extent that this challenging environment continues to be the same conditions for a prolonged period of time.
