Trinity Capital Q3 2026 Earnings Conference Call - TRINITY CAPITAL INC

Good morning everyone. My name is Beau and I will be your conference operator today. At this time, I would like to welcome everyone to Trinity Capital's third quarter 2026 earnings conference call, which is being held on November 4th, 2026. All participants have been placed in a listen-only mode and the floor will be open for your questions following the presentation. If you would like ask a question at that time, please press star 1 on your keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star 2. It is now my pleasure to turn the call over to Trinity Capital's Head of Investor Relations, Mr. Ben Malcolmson. Please go ahead, sir. Thank you, and welcome to Trinity Capitals' third quarter 2026 earnings conference call. Speaking on today's call are Kyle Brown, Chief Executive Officer, Sarah Stanton, General Counsel and Chief Compliance Officer, Michael Testa, Chief Financial Officer, and Jerry Harder, Chief Operating Officer. Also joining us for the Q&A portion of the call is Ron Kundich, Chief Credit Officer. Earlier today, we released our third quarter 2026 financial results, which are available on our website at ir.trinitycapital.com. As a reminder, certain statements on this call may be considered forward-looking under federal securities laws. For a full discussion of the risks and uncertainties related to these statements, Please refer to our most recent SEC filings. With that, allow me to turn the call over to Trinity Capital CEO, Kyle Brown. Thanks, Ben. Trinity Capital had a strong quarter across the board, and Trin's stock year-to-date total return of 31% remains first in the BDC space as of the end of Q3. We believe three key aspects are driving that. A diversified lending enterprise with five verticals spread across 24 industries. a growing managed funds platform, which generated $0.05 per share of NII benefit in Q3, and an internally managed structure that keeps our interests aligned with our investors. Let's start off with some shareholder-friendly news for Q3. As of September 30th, TRIN's total shareholder return is the best in the BDC space over the past one, three, and five years. From our IPO in 2021 to the end of Q3 TRIN stock has produced a total return of 177% outperforming the S&P 500's 119%, and the S & P BDC indexes 61% over the same time period. We're paying a 17-cent monthly dividend through the end of Q4, and Trent shareholders have now been the recipients of consistent distribution for seven consecutive years. Looking forward, we have warrant positions in 128 portfolio companies, which have the potential to provide incremental upside to our shareholders. Here are some highlights from Trent's performance during the third quarter. Net investment income increased to $0.52 per share and exceeded our $0,51 distribution during the quarter, driven in part by our best-in-class ROE of 15.5%. Our credit remained strong with non-accruals improving to 0.7% of the portfolio at fair market value. Our net asset value grew 5% quarter over quarter and 33% year over year to a record $1.3 billion. Also, NAV per share increased 1% from 1347 to 1361 quarter over quarter. It was a quarter defined by outperformance across NAV, originations, and credit quality. Platform AUM increased to $3.4 billion, up 31% year over year, as we continue to grow thoughtfully and strategically. We funded $614 million in Q3, and our pipeline is thriving, with $880 million of new commitments in Q4 and $1.4 billion in total unfunded commitments as of September 30th. As a point of emphasis, 91% of our unfunding commitments remain subject to ongoing diligence and investment committee approval, with just 9% unconditional, a structure that preserves underwriting discipline for future deployments. Our originations activity is only possible because of our strong underwriting culture. Both leading and lagging indicators of credit are positive, including sub-1% non-accruals, improved watch list movement, and best-in-class pick of 1%. Driven by an experienced team and proprietary pipeline, our consistency in originations and underwriting reflect a strong performance across Trinity's five lending verticals, tech lending, equipment finance, health care and life sciences, sponsor finance, and AVL. Our five verticals provide meaningful diversification while keeping us directly within our core competencies. Each vertical is staffed by world-class originators, underwriters, and portfolio managers, creating a scalable model that drives results without sacrificing focus. For example, our tech lending vertical is one of the top most two active players in the venture debt space, while our equipment finance unit has deployed more than $1.7 billion in its history and currently has a portfolio approaching $600 million. And as a direct lender, we originate our own deals with an agent on almost all deals and have immaterial overlap with other BDCs, giving our investors access to a genuinely differentiated portfolio. Our goal since day one hasn't changed, out-earn the dividend, grow the business, and do it the right way. That means owning our own pipeline, underwriting our own bills to our standards, and making decisions as one aligned team. That alignment starts with structure. As an internally managed BDC, there's no external manager collecting fees. Our employees, management, and board, we all own the same shares. We operate like shareholders because we are shareholders. Insiders own approximately 5% of trend shares as of the end of Q3. so our commitment to consistent dividends and long-term value creation is more than just a talking point it's a reality and the fees generated through our managed funds flow back to the public bdc creating incremental income that benefits shareholders directly rather than flowing to a third party what we're building is a platform with unique diversification growing scale and a managed funds business that's delivering meaningful income above our loans this architecture is the product of a consistent strategic decisions made quarter over quarter, year after year. Q3 proved once again that the model is working. Our pipeline is active, underwriting discipline is strong, and our capitalization strategy has been constructed to grow earnings power over time. Trinity is built for now and for what's next. From here, General Counsel Sarah Stanton, who spearheads our corporate development efforts, will walk through updates on our managed funds platform. Sarah? Thank you, Kyle. our managed funds and joint ventures continue to scale meaningfully, with nearly $1 billion of capacity across these strategies. The managed funds platform contributed $0.05 per share of NII benefit in Q3, enhancing returns for TRIN beyond the income generated by our BDC portfolio. We'd like to highlight two recent developments in our managed fund platform. First, our SBIC fund has now closed more than $75 million in equity commitments and is already being deployed. At a two-to-one debt-to equity ratio with low-cost leverage from the federal government, the SBIC Fund is expected to create more than 300 million dollars of incremental platform capacity at full scale. Meanwhile, we recently closed a second JV with Capital Southwest. This latest JV serves as a co-investment vehicle for deals in our sponsor finance vertical and has a potential total capacity of $500 million. We believe this new joint venture provides an optimal capitalization strategy for these assets and is consistent with our previously discussed plans to use our managed funds platform to maximize capital efficiency for each of our five verticals. This new JV is in addition to the first joint venture we announced with Capital Southwest earlier this year, which, as of the end of Q3, comprises $132 million of assets and 14 portfolio companies. A co-investment vehicle focusing on first-out, senior-secured loans in the lower-middle market, this strategic partnership has allowed us to diversify into a complementary segment of the lower middle market with a proven partner while minimizing risk and providing stable income for our investors. As a reminder, it features 50-50 decision making. We are encouraged by our growing partnership with a highly respected firm like Capital Southwest. The managed funds platform is doing exactly what it was designed to do. Generate incremental returns beyond our interest income, increase our origination's capacity, and widen our pool of available capital, all without diluting shareholders. The foundation is in place, and we expect this platform to become an increasingly meaningful contributor to earnings over time. With that, I'll pass it off to CFO Michael Testa for a closer look at our financial results. Michael? Thanks, Sarah. Our financial performance remained steady and strong in Q3. We generated $98 million in total investment income, a 30% year-over-year increase, and $50 million in net investment income or 52 cents per share representing 103% coverage of a quarterly distribution. Total net assets grew 5% to a record $1.3 billion, up 33% year-over-year. NAV per share increased $0.14 to $13.61, driven primarily by accretive ATM issuances. On the capital markets front, we continued to strengthen our balance sheet. We repaid $125 million of unsecured notes that matured in August, and on the last day of the quarter, we announced our second investment-grade public bond offering of $350 million of long five-year senior unsecured notes, which close post-quarter end. The offering extends our maturity profile, increases our liquidity. We also raised $58 million through our equity ATM at an average 32% premium to NAV, which is directly accretive to our existing shareholders. Net leverage was 1.17 times at quarter end, consistent with our target range, and total platform liquidity stands at $847 million. And lastly, a few other metrics worth highlighting. Estimated undistributed taxable income stands at approximately $67 million, or 69 cents per share, equivalent to more than four months of distributions. Our 15.5% return on average equity and 15.2% effective portfolio yield are among the highest in the BDC sector. And PIC remains immaterial at 1% of income. As we finish out the year and look towards 2027, we're confident in the earnings power of the platform and our ability to generate an industry-leading return on equity. And now, our COO, Jerry Harder, will walk you through our portfolio performance from here. Jerry? Thank you, Michael. Portfolio quality stayed strong in Q3 with 99.3% of debt investments at fair value performing and our average internal credit rating improving slightly to 3.1 on our 1 to 5 scale. The number of companies on non-accrual decreased to three with realizations of two small non-accurals and no additional credits added to non- accrual within the quarter. First lien coverage remained strong, with 89% of total principal secured by first-position liens on enterprise value, equipment, or both. For enterprise-backed loans, the weighted average loan-to-value was 22%. Our portfolio spans 24 industries, and no single borrower exceeds 3% of Total Exposure. Our largest sector concentration, financial technology, represents 15% of our total portfolio at cost and is spread across 18 borrowers. Regarding our AI exposure, it is diversified across both infrastructure and automation platforms, with each classification comprising less than 7% of the total portfolio at cost. of our portfolio at cost. Q3 included $7.5 million of net realized losses, partially offset by $4.4 million of Net Unrealized Appreciation. Asset valuations are set by our internal valuations team, corroborated by independent third-party valuation firms, reviewed by our auditors, and approved by our board of directors, a multi-layered process designed to give investors' confidence in the marks on our balance sheet. Overall, we're encouraged by our portfolio turnover, as our loan book continues to refresh in a beneficial way. 78% of the portfolio at cost has been originated since the start of 2025, with pre-2024 vintages now below 7%. And the average duration of our realized loans currently stands at 30 months. Q3 fundings broke down across our five verticals as follows, 26% to equipment finance, 18% to tech lending, 17% to sponsor finance, 15% to healthcare and life sciences, and 14% to asset-based lending, with the remaining 10% invested in off-balance sheet entities. At 89% first lien and 22% loan-to-value, the portfolio is built to hold up across cycles, which supports our dividend and NAV stability as we close out 2026 and look toward 2027. With that, we'll open the line for questions. Operator, please go ahead. Thank you very much. Ladies and gentlemen, at this time, if you do have any questions or comments, please press star 1 on your telephone. If you find your question has been answered, you may remove yourself from the queue by pressing star 2. Once again, star 1, please, for any questions. We'll go first this morning to Mickey Shaline with ClearStreet. Yes, good morning, everyone. I wanted to start with a question about the new JV with Capital Southwest, Desert Star. Could you expand on the type of investments you're putting in that JV versus Captran? Hi, Mickey. This is Sarah. Thanks for the question. Yeah, happy to expand on that. So the first JV that we closed with Capital Southwest, that relates to first out senior secured loans that primarily Capital Southwest is originating. So that kind of was a strategic and risk mitigated way for us to expand our reach into a segment of the lower middle market that we were not currently active in. Our latest joint venture with Capital Southwest relates to deals in our sponsor finance vertical. So those are our kind of, you know, more mature EBITDA positive borrowers. And the real purpose of launching that joint venture is really just to get a better cost of capital for those assets. You know, we have a credit facility for that entity that is really optimized for those types of credits, which are, again, you know, more mature, very creditworthy borrowers. Are those borrowers concentrated in any particular sectors? Those are primarily going to be lower middle market, fully kind of integrated software companies. We'll see some service-oriented as well, but the focus for us are going to be kind of the more mature software companies, senior secured facilities. And so when you underwrite those, given everything that's been discussed about AI over the last few quarters and your target of the lower middle market. How do you approach underwriting for those companies? I mean, they clearly need to have some sort of very meaningful competitive advantage for you to even consider them, I would assume. But what else are you looking for in those issuers before you dive in? Yeah, I mean, we launched that business with all these things in mind. We don't carry some long legacy portfolio of software deals from, you know, five, 10 years ago. These are mostly kind of newly established facilities with that underwriting in mind, meaning what AI tools have they either developed, are developing, what's the roadmap, what traction have they had selling those products. And so that goes into our underwriting. And what we have been looking for are really mature software companies that are highly integrated within an organization that are not easy to rip out or can't rip out, who are selling and using these tools already. And so our portfolio was really built with that whole concept in mind, meaning they're going to be winners and losers. Let's identify who the winners are, and let's use this kind of period of volatility here to get in and really lock down some great credits. And one more note on the JV is that's also co-investing, right? So these are investments, Desert Star. I mean, these are assets originated by Trin. Portions are held on the Trin balance sheet, but also syndicated to Desert Star, I understand. And just one follow-up question. You know, from the analyst chair, it's hard to forecast the allocated expenses to the IRA, which, you know, they more than doubled to $2 million, but platform AUM, you know, clearly didn't double. It grew from 3.2 to 3.4. How should we think about the trend in the allocation of expenses to the IRA over the coming quarter as these managed fund businesses and joint ventures continue to grow? Yeah, it should be actually pro rata based on the size and growth of the managed funds business. So this quarter, we did launch a Desert Star JV. There was a seed portfolio that we syndicated down there, $130 million. So that in and of itself grew the managed fund platform. in a one-time you know launch overall like syndications we you know those vehicles that are co-investing it's anywhere from 15 to 20 to 30 percent of our deals that are funded in the quarter are going to be syndicated to those vehicles so is 2 million of a decent run rate assumption for the next few quarters yeah to the extent that there's no new vehicles we're obviously continuously focusing on capital raising in the private and the managed funds businesses. But to the extent that those just continue to scale evenly periodically, you'll see that pro rata allocation be consistent. I understand. Those are all my questions this morning. Thank you for your time. Thanks, Ricky. Thank you. We'll go next now to Paul Johnson with KBW. Yeah, I just had a few questions. In terms of, like, repayment activity this quarter, higher level of repayments, I'd just ask, was that surprising or expected by you guys? And is there anything, I guess, you know, that you would see on your radar for that to potentially kind of elevate it into next year? Hey, Paul. That's Kyle. We, those repayments are consistent, but they ebb and flow. And so, you know, we saw a little bit more last quarter. I don't believe that's any kind of trend that we can point to going forward. It's going to continue to ebb and flow, it'll be consistent every quarter. We saw a lot of changes in the last quarter, a little more life science and tech, but it'll just continue to be steady as it's always been. No trends to point to. Thanks. And my next question is more of a higher level question, but as the origination funnel has expanded quite a bit over the years and the lending verticals have evolved as well, I mean, you now have conceivably kind of an overlaying like allocation decision, you know, on top of just kind of the individual credit reviews within your business with all the vehicles managed underneath the advisor. and conceivably just a higher volume of deals, I would think, that you would have to review. So I guess I'm wondering how has or how would you expect the investment committee or anything with the review process, I guess, to change over time to reflect that? Yeah, I mean, it's actually a little more simple than it sounds, but we've got five different businesses that all operate independent of one another. They're executing on an annual operating plan, meaning October of last year, November of last year, we sat down, we said, what are we going to achieve in 2026? And how much are we gonna deploy and when over what period of time? And those various teams are just executing exactly to that plan. And for the last three years, we've actually hit that plan pretty much right on the head or exceeded it. And so allocation of capital is really decided a year in advance. So everything we're doing right now, the dollars we're deploying and the capital that we're raising, both on and off balance sheet, it's all per plan. And I would tell you that internally, we already have 2027 figured out. And we have a plan for 2028 and 2029. And maybe some of that is going to be, we're going to continue to iterate on it, but we are creating goals and we have a vision for the future. And then we just execute on the plan and we build a system around it and we let that system carry the burden and we execute. And so that's, I mean, that's what we have been doing for years now. It isn't going to change going forward. We've created multiple layers of personnel and very senior personnel within each vertical from an underwriting perspective and portfolio management perspective. So that has to go through many filters before it gets to the eventual investment committee. Andso we have those buy boxes set. We have those underwriting standards and principles set. All the work is done and then presented to the investment committee in a very clear, concise, and consistent manner. So we're good at building plans and executing them. That's what we're going to keep doing. Appreciate it. Thanks for that, Kyle. That is all for me. Thanks, Paul. We'll go next now to Eric Zwick with Lucid Capital Markets. Thanks. Hello. Good day, everyone. Maybe just a quick follow-up on kind of the pipeline since we're just discussing that. In terms of you had two really strong quarters in a row of production, so just curious where the pipeline stands today versus, say, 90 days ago, and what does the mix look like from a vertical perspective? we continue to see thanks eric this is kyle um i the pipeline has continued to build uh we have i would tell you the largest pipeline that we've had in our history right now and uh you know we're executing on those term sheets we continueto push on pricing um we continue to see more and more um equipment and manufacturing here domestically that's and with some of the ai boom going on i just i continue to see equipment being a bit of an outlier but as you can see last quarter was pretty you know distributed amongst the verticals and i guess i'd go back to um the previous comment which is each of our verticals has an annual operating plan that they're executing to. And they have an allocation of capital to go out and deploy capital and execute on that plan, and that's what they're doing. So that's how we think about it. There's going to continue to be some outperform on the equipment side, but more or less, we're just executing on that plan, which is starting to look more and more diversified across the verticals. I would say also you can get a glimpse of that from the unfunded commitments, which we always remind our investors, these are subject to our investment committee approval nine-tenths of the time, right? But about a third of that is within healthcare and life sciences, about a quarter of it in equipment, and about 20% in tech lending with ABL and sponsor making up the rest. So that's kind of a good proxy for the pipeline, because those are deals that we've already won term sheets, and these are subsequent tranches. That's very helpful. Thanks. Next question, maybe for Michael, just looking at the income statement, there was a noticeable quarter-over-quarter increase in the non-control, non-affiliate fee income line. I guess anything in particular that drove that number higher, and is that a kind of, you know, one-time increase or non-recurring, or do you expect some of that strength to continue? Yeah, I mean, I think this quarter you saw a fee income increase. I think there hasn't been a whole lot of change between non-control and affiliate in our portfolio. But this quarter, we did see the spike of fee income, a combination of prepayment, exit fees, as well as origination fees, agent fees that we get that are somewhat transactional-based. Okay, and I guess were those kind of, you know, transaction fees more on new kind of origination activity or repayments, just trying to figure out, like, you're obviously originating more, so you may see more of those on the front end. So just trying to understand how much of the increase we saw is sustainable in future quarters. Yeah, I mean, a lot of this is driven from our equipment financing vertical. So we get anywhere from 2% to 3% closing structuring fees on those assets. So if you have a portfolio that continues to grow and has more origination activity, you'll see the benefit there. This quarter, again, like Kyle mentioned, prepayment fees came through. Those were split between tech and life sciences. but it's been elevated. Those continue to, you know, we saw that last quarter. We saw that in the previous quarter. So we can continue to see that, you know, as these companies are healthy, they're meeting their milestones. It's a combination of M&A activity, refinancing us out with cheaper debt, but continue to grow. Thank you. And last one for me, just looking at the pace of ATM share issuance in 3Q? It was lower than it had been in the past, maybe four or five quarters. Any particular reason that it was lower in 3q? And, you know, what should we kind of expect for your desire to kind of utilize the ATM going forward? Yeah, I mean, we love the ATM program. It's an efficient, you now, optimal way of raising capital when just in time, you As we see deployments and the pipeline grow, we're able to manage the ATM program effectively to meet those funding requirements. But we had higher repayments and higher syndications, so we're able to to manage the amount of equity, new equity we raise. At the end of the day, we are constantly looking at raising capital if it's accretive to net investment income or on a NAV basis. Thank you for taking my questions today. Thanks, Eric. We'll go next now to Jason Stewart with CompassPoint. Hi, thanks. You guys have been pretty thoughtful about your approach to the infrastructure, equipment, GPU, compute finance space. I'm wondering if you could share some high-level thoughts on the election impact and maybe any change in the near-term landscape to that business and how you're positioned vis-à-vis that change. Thanks. Yeah, I mean, I think, you know, first and foremost, when you remove some uncertainty, you know, that typically helps or hurts markets, but at least that clarity gives investors the ability to make decisions based on what they think they know, right? So I'd say first and foremost, that's probably a good thing because we at least have an understanding as to where different politicians sit on the topic. The business that we've done to date, assuming it is more difficult to get data centers up and going and GPUs deployed will just simply benefit, I think, from some of that volatility. So if I'm taking kind of the optimistic standpoint, what we've done so far is now a little bit more valuable than it was before. And if it is more difficulty to get GPUs online in data centers across the country, that cost of those units is going to go up and so I think for what we've done already it means it's a positive impact to us. What we do going forward I think we'll do what we always do which is sit back, make sure we understand the playing field, understand the new risks, see if it's changed and then start to step into the opportunity if it makes sense to. I think that's how I see it. Yeah, it strikes me as creative financing solutions will still be a necessary part to the puzzle. So thank you, Kyle, for that color. Thanks. Yeah. We'll go next now to Chris Muller with Citizens Capital Markets. hey guys thanks for taking the questions um so i guess looking at your five verticals and the prospect for higher rates is there a particular area that you guys expect to outperform in a rising rate environment that you might lean in on a little more if the forward curve is realized yeah i think it's a great question you know i think we're already leaning into that kind of lower middle market space we have been now for a couple years uh with a lot of private credit moving upstream, focusing on middle and upper middle markets. You know, higher rates mean better returns there. But I would say that all of them are really going to benefit. I mean, we provide this analysis to shareholders, which really shows pretty limited impact to trend on a, you know, rates going down. But with rates going up, that really increases our income because our facilities, the majority of them, they have floors, which is great if rates are going down, but they don't have ceilings. And so that can drive new payoffs, right? Like we saw before when rates went up, which can increase fee income, or that can just create more and higher, you know, current income as well. So I think we set the portfolio up to do really well in a rate declining environment, knowing that if rates went up, we happen to benefit from that. So I feel pretty good about our position relative to rates and rate sensitivity. Got it. And rising rates are an obvious tailwind for the bottom line, but maybe thinking about some secondary effects, do you guys expect your fundraising efforts to also benefit from improving sentiment? Yeah, man, it's a good question. Fundraising is always hard. I think that our track record and consistency in a raising rate environment, a declining rate environment, five different administrations, all of that has been very consistent. And when we're talking to investors, that's really what we're pointing to is our consistency throughout different markets, our ability to gauge what's going on, understand the new risks, pivot. We like to say we're scrappy around here. I know Jerry hates that word. Some of us like it. But we are. And so we're going to assess what's Going on. We're going to Assess where the new maybe veins or pockets of investment and opportunities are. Then we're not going to be afraid to jump in there and figure it out. So, you know, fundraising is going well. It's always hard, but man, I would say it's going really well. And it's a big part of our future, providing liquidity through our managed funds business, which gives TRIN unlimited upside to our stock, earning per share, NAV, et cetera. So we're really going to focus on building out our verticals and making sure they're best in class. And then we're going to align that with capital through our Managed Funds business to make sure that we have the liquidity necessary to keep building those businesses. Got it. It's very helpful. Appreciate you guys taking the questions today. Good to hear from you, Chris. Thank you. We'll go next now to Christopher Nolan with Ladenburg Thalman. Sarah, what's going to be the leverage level for this new JV once it's fully deployed? Leverage level for the new Jv? Where's it at right now, Mike? Yeah, right now it's close to one-to-one. It's going to be consistent with the BDC, slightly higher, trying to get up to two-to one. So moderate leverage, but it's optimal, right? You're setting it up a separate vehicle that has the structure of the underlying secured facility aligned to those assets. So it's a better advance rate, and you're able to manage it in a better cost of capital there. Okay, is that really just bank facility type financing? That's right. A revolving facility, launched it, continued to grow, expect to syndicate it further, as it goes. What sort of advance rate are you getting? Yeah, I mean, I think, again, this is a similar advance rate that our current BDC has, but, again., you get a better way to manage it with specific those type assets, those type of deals. So anywhere from 60% to 70%. Great. And I guess as a follow-up, with all these JVs going on, and you actually have a lot of outside entities that want to work with you and tap your deal flow, how – I mean, should we expect a material increase in your operating expenses or operating efficiencies going forward, or is there some operating leverage where you can basically scale up with minimal incremental growth in expenses? Yeah, so I think the first thing to think about is these are all the same deals, right, with these various JVs. We're just tapping into different pockets of liquidity for them, right? So there is some scaling leverage there. But you've got to remember that we are not just a stagnant pool of assets, but a management company, an operating company, right? And so if we're growing at a 20% to 30% annual growth rate, which we have been for five years, that means expenses have to go up. Now, income should go up and exceed that, which it has been and will continue to over time because our expense ratios have continued to come down to the point now where we're right in line with our BDC peers. And over time, as we continue to raise more capital and grow the business, that will just continue to improve. But we're not trying to optimize for – that is a lever that externally managed BDCs use because they have no other levers. That's not what we're focused on. We are building the business. We are hiring a lot of folks. And our income and our earnings per share will increase above and beyond those additional expenses. And, Chris, just to put a finer point on that. So, you know, like Kyle said, these are co-invested vehicles. So, like, the credit underwriting, the portfolio management, that's already being done. There's no incremental cost there. And then any cost directly associated with a particular vehicle, whether it's, you know, accounting costs, funded admin, those are borne by the specific vehicle, not by the BDC. Great. Thank you. Thanks, Chris. Thank you. Just a quick reminder, ladies and gentlemen, any further questions today? Star 1, please. We'll go next now to Alexander Villalobos with Jefferies. Thank you for taking my question. A little bit more detail on originations, just on the environment. What are you guys seeing with spreads, covenants, and leverage? Just a little more detail there on color would be great. Thank you Yeah, I think we've seen spreads. Well, it depends on the vertical. But I'd say more often than not, over the last few years, spreads have tightened up in some of our verticals. Some not as much. But in some, they have been declining over the past few years with competition and a lot of liquidity out there. We've seen that trend start to really hold up. And in some ways, we're pushing pricing. And so I think 2027 should probably look like a spread flat to up year. And we are certainly testing that right now, as I believe there is a lack of liquidity, as I think back leverage and fundraising has become more difficult. Supply and demand is going to start kicking in. And so, you know, when you're thinking about the broadly syndicated market and spreads there. That's not, that's just not the market we plan, right? We are originating directly with these companies. The value that we're providing to them and working directly with them means we're going to end up with a higher spread generally. And dealing in the market, we deal in, which is this kind of growth stage to lower middle market. We just, we just have different companies, different competition, and there are different spreads. And so we haven't seen the spread compression that the rest of the private credit market has seen over the last five years. It's been smaller, and now it's kind of knee-jerking back the opposite direction. Perfect. Thank you, and congrats on the results. Thanks, Alexander. Thank you. And ladies and gentlemen, it appears we have no further questions this morning. Mr. Brown, I'll turn things back to you, sir, for any closing comments. Great. Thank You. Well, on behalf of the Trinity Capital team, thank you for joining us today. Q3 was a strong quarter by all measures, and Trinity Capital is experiencing tremendous momentum right now. We're enthusiastic about where we're headed. We're excited to host many of you at our investor event next Thursday at the New York Stock Exchange before we have the honor of ringing the closing bell that afternoon with our team. We look forward to sharing our Q4 results in February. In the meantime, please don't hesitate to reach out to the IR desk with further questions. Have a great day. Thanks. Thank you very much, Mr. Brown. Again, Ladies and gentlemen, that will conclude Trinity Capital's third quarter earnings call. We'd like to thank you all so much for joining us. Wish you all a great afternoon. Goodbye.