COMMITMENTS AND CONTINGENCIES |
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Legal Proceedings
We are party to certain legal proceedings incidental to the normal course of our business. We are required to establish reserves for litigation matters where those matters present loss contingencies that are both probable and estimable. When loss contingencies are not both probable and estimable, we do not establish reserves. Based on current knowledge, we do not believe that loss contingencies, if any, arising from pending investigations, litigation, or regulatory matters will have a material adverse effect on our financial condition, results of operation, or cash flows. Additionally, based on our current knowledge, we do not believe such loss contingencies are both probable and estimable and, therefore, as of March 31, 2023 and 2022, we had no established reserves for such loss contingencies.
Escrow Holdbacks
From time to time, we enter into arrangements relating to exits of certain investments whereby specific amounts of the proceeds are held in escrow to be used to satisfy potential obligations, as stipulated in the sales agreements. We record escrow amounts in Restricted cash and cash equivalents, if received in cash but subject to potential obligations or other contractual restrictions, or as escrow receivables in Other assets, net, if not yet received in cash, on our accompanying Consolidated Statements of Assets and Liabilities. We establish reserves and holdbacks against escrow amounts if we determine that it is probable and estimable that a portion of the escrow amounts will not ultimately be released or received at the end of the escrow period. Reserves and holdbacks against escrow amounts were $0.1 million and $0.2 million as of March 31, 2023 and 2022, respectively.
Financial Commitments and Obligations
We may have line of credit and delayed draw term debt commitments to certain of our portfolio companies that have not been fully drawn. Since these line of credit and delayed draw term debt commitments have expiration dates, and we expect many will never be fully drawn, the total line of credit and delayed draw term debt commitment amounts do not necessarily represent future cash requirements. We estimate the fair value of the combined unused line of credit commitments as of March 31, 2023 and 2022 to be insignificant.
We may also extend guaranties on behalf of our portfolio companies. As of March 31, 2023, there were no guaranties outstanding. As of March 31, 2022, the following guaranties were outstanding on behalf of two of our portfolio companies:
•A $1.0 million continuing guaranty of a wholesale financing facility agreement (the “Floor Plan Facility”) between DLL Finance LLC (f/k/a Agricredit Acceptance, LLC) and CCE. The Floor Plan Facility provided CCE with financing to bridge the time and cash flow gap between the order and delivery of golf carts to customers. In conjunction with the term loan repayment by CCE in November 2022, the guaranty was released and terminated.
•A $9.3 million guaranty that we extended in February 2022, on behalf of J.R. Hobbs, whereby we had guaranteed 50% of their obligations with another lender, with a maximum amount of $9.3 million. In June 2022, the guaranty was released and terminated.
As of March 31, 2023 and 2022, we have not been required to make any payments on these guaranties, or any guaranties that existed in previous periods, and we consider the credit risk to be remote and the fair value of the guaranty as of March 31, 2023 and 2022 to be not significant.
The following table summarizes the principal balances of unused line of credit and delayed draw term debt commitments and guaranties as of March 31, 2023 and 2022, which are not reflected as liabilities in the accompanying Consolidated Statements of Assets and Liabilities:
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