v3.25.4
Fair Value Measurements
 12 Months Ended
Dec. 31, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
Investments
The Company values all investments in accordance with ASC Topic 820. ASC Topic 820 requires enhanced disclosures about assets and liabilities that are measured and reported at fair value. As defined in ASC Topic 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Where available, fair value is based on observable market prices or parameters, or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These valuation models involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the assets or liabilities or market and the assets’ or liabilities’ complexity.
ASC Topic 820 establishes a hierarchical disclosure framework which prioritizes and ranks the level of market price observability of inputs used in measuring investments at fair value. Market price observability is affected by a number of factors, including the type of investment and the characteristics specific to the investment. Investments with readily available active quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.
Based on the observability of the inputs used in the valuation techniques, the Company is required to provide disclosures on fair value measurements according to the fair value hierarchy. The fair value hierarchy ranks the observability of the inputs used to determine fair values. Investments carried at fair value are classified and disclosed in one of the following three categories:
•Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities at the measurement date.
•Level 2 – Valuations based on inputs other than quoted prices in active markets, including quoted prices for similar assets or liabilities, which are either directly or indirectly observable.
•Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement. This includes situations where there is little, if any, market activity for the assets or liabilities. The inputs into the determination of fair value are based upon the best information available and may require significant management judgment or estimation.
In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset’s or liability’s categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability.
The Board has designated MC Advisors as the Company’s valuation designee (the “Valuation Designee”). The Board is responsible for oversight of the Valuation Designee. The Valuation Designee has established a valuation committee to determine in good faith the fair value of the Company’s investments, based on input of the Valuation Designee’s management and personnel and independent valuation firms which are engaged at the direction of the valuation committee to assist in the valuation of certain portfolio investments lacking a readily available market quotation. The valuation committee determines fair values pursuant to a valuation policy approved by the Board and pursuant to a consistently applied valuation process.
With respect to investments for which market quotations are not readily available, the Valuation Designee undertakes a multi-step valuation process each quarter, as described below:
•the quarterly valuation process begins with each portfolio company or investment being initially evaluated and rated by the investment professionals of the Valuation Designee responsible for the credit monitoring of the portfolio investment;
•the Valuation Designee engages independent valuation firms to conduct independent appraisals of a selection of investments for which market quotations are not readily available. The Valuation Designee will consult with an independent valuation firm relative to each portfolio company at least once in every calendar year, but the independent appraisals are generally received quarterly for each investment;
•to the extent an independent valuation firm is not engaged to conduct an investment appraisal on an investment for which market quotations are not readily available in a particular quarter, the investment will be valued by the Valuation Designee;
•preliminary valuation conclusions are then documented and discussed with the valuation committee of the Valuation Designee;
•the valuation conclusions are approved by the valuation committee of the Valuation Designee; and
•a report prepared by the Valuation Designee is presented to the Board quarterly to allow the Board to perform its oversight duties of the valuation process and the Valuation Designee.
The accompanying consolidated schedules of investments held by the Company consist primarily of private debt instruments (“Level 3 debt”). The Valuation Designee generally uses the income approach to determine fair value for Level 3 debt where market quotations are not readily available, as long as it is appropriate. If there is deterioration in credit quality or a debt investment is in workout status, the Valuation Designee may consider other factors in determining the fair value, including the value attributable to the debt investment from the enterprise value of the portfolio company or the proceeds that would be received in a liquidation analysis. This liquidation analysis may include probability weighting of alternative outcomes. The Valuation Designee generally considers the Company’s Level 3 debt to be performing if the borrower is not in default, the borrower is remitting payments in a timely manner; the loan is in covenant compliance or is otherwise not deemed to be impaired. In determining the fair value of the performing Level 3 debt, the Valuation Designee considers fluctuations in current interest rates, the trends in yields of debt instruments with similar credit ratings, financial condition of the borrower, economic conditions and other relevant factors, both qualitative and quantitative. In the event that a Level 3 debt instrument is not performing, as defined above, the Valuation Designee will evaluate the value of the collateral utilizing the same framework described above for a performing loan to determine the value of the Level 3 debt instrument.
Under the income approach, discounted cash flow models are utilized to determine the present value of the future cash flow streams of its debt investments, based on future interest and principal payments as set forth in the associated loan agreements. In determining fair value under the income approach, the Valuation Designee also considers the following factors: applicable market yields and leverage levels, recent transactions, credit quality, prepayment penalties, the nature and realizable value of any collateral, the portfolio company’s ability to make payments, and changes in the interest rate environment and the credit markets that generally may affect the price at which similar investments may be made.
Under the market approach, the enterprise value methodology is typically utilized to determine the fair value of an investment. There is no one methodology to estimate enterprise value and, in fact, for any one portfolio company, enterprise value is generally best expressed as a range of values, from which the Valuation Designee derives a single estimate of enterprise value. In estimating the enterprise value of a portfolio company, the Valuation Designee analyzes various factors consistent with industry practice, including but not limited to original transaction multiples, the portfolio company’s historical and projected financial results, applicable market trading and transaction comparables, applicable market yields and leverage levels, the nature and realizable value of any collateral, the markets in which the portfolio company does business, and comparisons of financial ratios of peer companies that are public. Typically, the enterprise values of private companies are based on multiples of earnings before interest, income taxes, depreciation and amortization (“EBITDA”), cash flows, net income, revenues, or in limited cases, book value.
In addition, for certain investments, the Valuation Designee may base its valuation on indicative bid and ask prices provided by an independent third-party pricing service. Bid prices reflect the highest price that the Company and others may be willing to pay. Ask prices represent the lowest price that the Company and others may be willing to accept. The Valuation Designee generally uses the midpoint of the bid/ask range as its best estimate of fair value of such investment.
As of December 31, 2025, the Valuation Designee determined, in good faith, the fair value of the Company’s portfolio investments in accordance with GAAP and the Company’s valuation procedures based on the facts and circumstances known by the Company and the Valuation Designee at that time, or reasonably expected to be known at that time.
Foreign Currency Forward Contracts
The valuation for the Company’s foreign currency forward contracts is based on the difference between the exchange rate associated with the forward contract and the exchange rate at the current period end. Foreign currency forward contracts are categorized as Level 2 in the fair value hierarchy.
Fair Value Disclosures
The following tables present fair value measurements of investments and foreign currency forward contracts, by major class according to the fair value hierarchy as of December 31, 2025 and December 31, 2024:
Fair Value Measurements
December 31, 2025 Level 1 Level 2Level 3Total
Investments, at fair value:
Senior secured loans$— $— $5,090,861 $5,090,861 
Unitranche secured loans— — 35,414 35,414 
Junior secured loans— — 277,025 277,025 
Equity investments145 — 416,310 416,455 
Total investments, at fair value:$145 $— $5,819,610 $5,819,755 
Foreign currency forward contracts asset (liability)$— $(3,172)$— $(3,172)
Fair Value Measurements
December 31, 2024Level 1Level 2Level 3Total
Investments, at fair value:
Senior secured loans$— $— $3,491,117 $3,491,117 
Unitranche secured loans— — 148,531 148,531 
Junior secured loans— — 177,677 177,677 
Equity investments149 — 191,499 191,648 
Total investments, at fair value:$149 $— $4,008,824 $4,008,973 
Foreign currency forward contracts asset (liability)$— $1,501 $— $1,501 
Senior secured loans, unitranche secured loans and junior secured loans are collateralized by tangible and intangible assets of the borrowers. These investments include loans to entities that have some level of challenge in obtaining financing from other, more conventional institutions, such as a bank. Interest rates on these loans are either fixed or floating and are based on current market conditions and credit ratings of the borrower. Excluding loans on non-accrual status, the contractual interest rates on the loans in the Company's investment portfolio ranged from 5.75% to 18.75% at December 31, 2025 and 5.50% to 20.80% at December 31, 2024. The maturity dates on the loans outstanding at December 31, 2025 range between April 2026 and December 2032.
The following tables provide a reconciliation of the beginning and ending balances for investments at fair value that use Level 3 inputs for the years ended December 31, 2025 and 2024:
Investments
Senior
secured loans		Unitranche
secured loans		Junior
secured loans		Equity
investments		Total
investments
Balance as of December 31, 2024$3,491,117 $148,531 $177,677 $191,499 $4,008,824 
Net realized gain (loss) on investments(2,768)— (3,142)581 (5,329)
Net change in unrealized gain (loss) on investments(44,701)(5,749)(50,415)1,073 (99,792)
Purchases of investments and other adjustments to cost (1)
2,527,221 487 142,213 202,176 2,872,097 
Proceeds from principal payments and sales of investments (2)
(817,050)(91,213)(43,174)(4,753)(956,190)
Reclassifications (3)
(62,958)(16,642)53,866 25,734 — 
Balance as of December 31, 2025$5,090,861 $35,414 $277,025 $416,310 $5,819,610 
Investments
Senior
secured loans		Unitranche
secured loans		Junior
secured loans		Equity
investments		Total
investments
Balance as of December 31, 2023$2,171,243 $184,853 $87,986 $84,062 $2,528,144 
Net realized gain (loss) on investments(98)— 39 118 59 
Net change in unrealized gain (loss) on investments6,747 288 (11,646)5,703 1,092 
Purchases of investments and other adjustments to cost (1)
1,981,176 8,269 78,335 85,001 2,152,781 
Proceeds from principal payments and sales of investments (2)
(601,460)(44,879)(22,839)(3,941)(673,119)
Reclassifications (3)
(66,491)— 45,802 20,689 — 
Transfers in (out) of Level 3 (4)
— — — (133)(133)
Balance as of December 31, 2024$3,491,117 $148,531 $177,677 $191,499 $4,008,824 
_________________________________________
(1)Includes purchases of new investments, effects of refinancing and restructurings, premium and discount accretion and amortization and PIK interest capitalized.
(2)Represents net proceeds from investments sold and principal paydowns received.
(3)Represents non-cash reclassification of investment type due to a restructuring.
(4)Represents non-cash transfers between fair value categories.
The total net change in unrealized gain (loss) on investments included on the consolidated statements of operations for the year ended December 31, 2025, attributable to Level 3 investments still held at December 31, 2025, was $(96,673). The total net change in unrealized gain (loss) on investments included on the consolidated statements of operations for the year ended December 31, 2024, attributable to Level 3 investments still held at December 31, 2024, was $(4,494). Reclassifications impacting Level 3 of the fair value hierarchy are reported as transfers in or out of Level 3 as of the beginning of the period in which the reclassifications occur. There were no transfers among Levels 1, 2 and 3 for the year ended December 31, 2025. During the year ended December 31, 2024, one investment transferred from Level 3 to Level 1 as a result of a restructuring.
Significant Unobservable Inputs
ASC Topic 820 requires disclosure of quantitative information about the significant unobservable inputs used in the valuation of assets and liabilities classified as Level 3 within the fair value hierarchy. Disclosure of this information is not required in circumstances where a valuation (unadjusted) is obtained from a third-party pricing service and the information regarding the unobservable inputs is not reasonably available to the Company and as such, the disclosures provided below exclude those investments valued in that manner. The tables below are not intended to be all-inclusive, but rather to provide information on significant unobservable inputs and valuation techniques used by the Valuation Designee.
The following table presents quantitative information about the valuation techniques and significant unobservable inputs of the Company's Level 3 investments as of December 31, 2025:
Fair ValueValuation
Technique		Unobservable
Input
Weighted
Average
Mean (1)
Range
Minimum Maximum
Assets:
Senior secured loans$3,428,212 Discounted cash flowEBITDA multiples
11.1x
4.3x
36.4x
Market yields9.6%7.2%19.8%
Senior secured loans1,192,777 Discounted cash flowRevenue multiples
7.2x
1.0x
14.0x
Market yields9.4%7.5%20.0%
Senior secured loans61,795 Enterprise valueEBITDA multiples
7.2x
5.5x
12.0x
Senior secured loans43,978 Enterprise valueRevenue multiples
2.6x
0.5x
5.3x
Senior secured loans4,452 LiquidationProbability weighting of alternative outcomes44.0%44.0%44.0%
Unitranche secured loans18,186 Discounted cash flowEBITDA multiples
10.5x
10.5x
10.5x
Market yields8.8%8.4%16.0%
Unitranche secured loans17,228 Discounted cash flowRevenue multiples
5.5x
5.5x
5.5x
Market yields13.2 %13.2 %13.2 %
Junior secured loans243,696 Discounted cash flowEBITDA multiples
8.8x
8.8x
8.8x
Market yields14.0 %12.5 %17.3 %
Junior secured loans17,118 Enterprise valueRevenue multiples
4.9x
1.0x
5.3x
Junior secured loans9,451 Enterprise valueEBITDA multiples
7.2x
4.3x
12.0x
Equity investments327,486 Enterprise valueEBITDA multiples
10.7x
6.8x
17.3x
Equity investments80,634 Enterprise valueRevenue multiples
4.2x
0.5x
10.8x
Equity investments7,271 Option pricing modelVolatility47.2 %24.0 %70.0 %
Total Level 3 Assets$5,452,284 (2)
_________________________________________
(1)The weighted average mean of unobservable inputs is based on the fair value of investments.
(2)Excludes investments of $367,326 at fair value where valuation (unadjusted) is obtained from a third-party pricing service or broker quote for which such disclosure is not required.
The following table presents quantitative information about the valuation techniques and significant unobservable inputs of the Company's Level 3 investments as of December 31, 2024:
Fair ValueValuation
Technique		Unobservable
Input
Weighted
Average
Mean (1)
Range
MinimumMaximum
Assets:
Senior secured loans$2,224,530 Discounted cash flowEBITDA multiples
11.1x
5.3x
35.9x
 Market yields10.4%8.2%21.8%
Senior secured loans931,531 Discounted cash flowRevenue multiples
7.6x
1.0x
18.0x
Market yields10.6%8.5%25.5%
Senior secured loans17,392 Enterprise valueEBITDA multiples
10.1x
6.5x
13.0x
Senior secured loans15,818 Enterprise valueRevenue multiples
1.6x
0.3x
5.3x
Senior secured loans6,042 LiquidationProbability weighting of alternative outcomes59.7%59.7%59.7%
Unitranche secured loans114,503 Discounted cash flowEBITDA multiples
10.2x
8.0x
11.3x
Market yields12.0%9.2%16.2%
Unitranche secured loans34,028 Discounted cash flowRevenue multiples
6.3x
6.3x
6.3x
Market yields13.9%13.9%13.9%
Junior secured loans108,449 Discounted cash flowMarket yields14.8%12.6%17.7%
Junior secured loans26,886 Enterprise valueRevenue multiples
4.6x
0.3x
5.3x
Junior secured loans3,752 Enterprise valueEBITDA multiples
7.0x
7.0x
7.0x
Equity investments127,944 Enterprise valueEBITDA multiples
11.3x
3.6x
20.5x
Equity investments51,219 Enterprise valueRevenue multiples
3.6x
0.4x
11.0x
Equity investments9,065 Option pricing modelVolatility46.4%24.0%65.0%
Total Level 3 Assets$3,671,159 (2)
_________________________________________
(1)The weighted average mean of unobservable inputs is based on the fair value of investments.
(2)Excludes investments of $337,665 at fair value where valuation (unadjusted) is obtained from a third-party pricing service or broker quote for which such disclosure is not required.
The significant unobservable input used in the income approach of fair value measurement of the Company’s investments is the discount rate used to discount the estimated future cash flows expected to be received from the underlying investment, which includes both future principal and interest payments. Increases (decreases) in the discount rate would result in a decrease (increase) in the fair value estimate of the investment. Included in the consideration and selection of discount rates are the following factors: risk of default, rating of the investment and comparable investments, and call provisions.
The significant unobservable inputs used in the market approach of fair value measurement of the Company’s investments are the market multiples of EBITDA or revenue of the comparable guideline public companies. The Valuation Designee selects a population of public companies for each investment with similar operations and attributes of the portfolio company. Using these guideline public companies’ data, a range of multiples of enterprise value to EBITDA or revenue is calculated. The Valuation Designee selects percentages from the range of multiples for purposes of determining the portfolio company’s estimated enterprise value based on said multiple and generally the latest twelve months EBITDA or revenue of the portfolio company (or other meaningful measure). Increases (decreases) in the multiple will result in an increase (decrease) in enterprise value, resulting in an increase (decrease) in the fair value estimate of the investment.
Other Financial Assets and Liabilities
ASC Topic 820 requires disclosure of the fair value of financial instruments for which it is practical to estimate such value. The Company believes that the carrying amounts of its other financial instruments such as cash and restricted cash and cash equivalents, receivables and payables approximate the fair value of such items due to the short maturity of such instruments.
Fair value is estimated by discounting remaining payments using applicable market rates or market quotes for similar instruments at the measurement date, if applicable. The following table presents the carrying values and fair values of the Company's debt as of December 31, 2025 and December 31, 2024:
December 31, 2025December 31, 2024
Carrying Value(1)
Fair Value
Carrying Value(1)
Fair Value
Revolving Credit Facility(2)
$627,266 $627,266 $474,756 $474,756 
SPV Credit Facility97,515 97,515 239,889 239,889 
SPV II Credit Facility568,316 568,316 194,574 194,574 
SPV III Credit Facility148,568 148,568 73,722 73,722 
SPV IV Credit Facility172,753 172,753 245,185 245,185 
SPV V Credit Facility123,361 123,361 — — 
2022 ABS234,697 234,604 293,393 287,178 
2023 ABS207,239 210,271 206,369 209,100 
2025 ABS411,711 411,711 — — 
July 2028 Notes41,476 42,096 — — 
November 2028 Notes99,324 101,232 99,089 100,273 
December 2028 Notes99,324 101,279 99,089 100,272 
July 2029 Notes154,981 156,242 154,697 154,918 
September 2029 Notes47,686 47,699 47,599 47,667 
July 2030 Notes159,290 161,679 — — 
Total Debt$3,193,507 $3,204,592 $2,128,362 $2,127,534 
_____________________________________________
(1)Represents the principal amount outstanding, less unamortized debt issuance costs.
(2)Amounts include borrowings denominated in foreign currencies converted at the period end exchange rate.
The below table presents fair value measurements of the Company’s debt obligations according to the fair value hierarchy as of December 31, 2025 and December 31, 2024:
December 31, 2025December 31, 2024
Level 1
$— $— 
Level 2
— — 
Level 3
3,204,592 2,127,534 
Total Debt$3,204,592 $2,127,534