| Fair Value Measurements |
5. Fair Value Measurements The following tables summarize the Company’s investments and cash equivalents categorized within the fair value hierarchy as of June 30, 2026 and December 31, 2025:
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June 30, 2026 |
|
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
Total |
|
First Lien debt investments |
$ |
— |
|
$ |
— |
|
$ |
509,228 |
|
$ |
509,228 |
|
Second Lien debt investments |
|
— |
|
|
— |
|
|
78,220 |
|
|
78,220 |
|
Unsecured and Subordinated debt investments |
|
— |
|
|
— |
|
|
62,260 |
|
|
62,260 |
|
Preferred equity investments |
|
— |
|
|
— |
|
|
57,531 |
|
|
57,531 |
|
Total Investments at fair value before Cash Equivalents |
|
— |
|
|
— |
|
|
707,239 |
|
|
707,239 |
|
Money Market Fund |
|
21,967 |
|
|
— |
|
|
— |
|
|
21,967 |
|
Total Cash Equivalents |
|
21,967 |
|
|
— |
|
|
— |
|
|
21,967 |
|
Total Investments at fair value after Cash Equivalents |
$ |
21,967 |
|
$ |
— |
|
$ |
707,239 |
|
$ |
729,206 |
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December 31, 2025 |
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|
Level 1 |
|
Level 2 |
|
Level 3 |
|
Total |
|
First Lien debt investments |
$ |
— |
|
$ |
— |
|
$ |
309,054 |
|
$ |
309,054 |
|
Second Lien debt investments |
|
— |
|
|
— |
|
|
88,220 |
|
|
88,220 |
|
Unsecured and Subordinated debt investments |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Preferred equity investments |
|
— |
|
|
— |
|
|
55,168 |
|
|
55,168 |
|
Total Investments at fair value before Cash Equivalents |
|
— |
|
|
— |
|
|
452,442 |
|
|
452,442 |
|
Money Market Fund |
|
138,828 |
|
|
— |
|
|
— |
|
|
138,828 |
|
Total Cash Equivalents |
|
138,828 |
|
|
— |
|
|
— |
|
|
138,828 |
|
Total Investments at fair value after Cash Equivalents |
$ |
138,828 |
|
$ |
— |
|
$ |
452,442 |
|
$ |
591,270 |
|
The following tables present the changes in the fair value of investments for which Level 3 inputs were used to determine the fair value as of and for the three and six months ended June 30, 2026 and June 30, 2025:
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For the Three Months Ended |
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June 30, 2026 |
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|
First Lien Debt Investments |
|
Second Lien Debt Investments |
|
Unsecured and Subordinated Debt Investments |
|
Preferred Equity Investments |
|
Total Investments |
|
Fair value, beginning of period |
$ |
441,766 |
|
$ |
81,330 |
|
$ |
75,549 |
|
$ |
56,801 |
|
$ |
655,446 |
|
Purchases and originations of investments |
|
71,777 |
|
|
— |
|
|
— |
|
|
— |
|
|
71,777 |
|
Paid-in-kind interest income |
|
154 |
|
|
— |
|
|
1,791 |
|
|
— |
|
|
1,945 |
|
Paid-in-kind dividend income |
|
— |
|
|
— |
|
|
— |
|
|
1,591 |
|
|
1,591 |
|
Proceeds from sale of investments and principal repayments |
|
(1,697 |
) |
|
— |
|
|
(15,110 |
) |
|
— |
|
|
(16,807 |
) |
Net change in unrealized gains (losses) on investments |
|
(2,998 |
) |
|
(3,167 |
) |
|
(11 |
) |
|
(861 |
) |
|
(7,037 |
) |
Net realized gains (losses) on investments |
|
— |
|
|
— |
|
|
(1 |
) |
|
— |
|
|
(1 |
) |
Net amortization of discount on investments |
|
226 |
|
|
57 |
|
|
42 |
|
|
— |
|
|
325 |
|
Transfers into (out of) Level 3 |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Fair value, end of period |
$ |
509,228 |
|
$ |
78,220 |
|
$ |
62,260 |
|
$ |
57,531 |
|
$ |
707,239 |
|
Net change in unrealized gains (losses) on non-controlled, non-affiliated investments still held at June 30, 2026 |
$ |
(2,998 |
) |
$ |
(3,167 |
) |
$ |
(11 |
) |
$ |
(861 |
) |
$ |
(7,037 |
) |
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For the Six Months Ended |
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June 30, 2026 |
|
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First Lien Debt Investments |
|
Second Lien Debt Investments |
|
Unsecured and Subordinated Debt Investments |
|
Preferred Equity Investments |
|
Total Investments |
|
Fair value, beginning of period |
$ |
309,054 |
|
$ |
88,220 |
|
$ |
— |
|
$ |
55,168 |
|
$ |
452,442 |
|
Purchases and originations of investments |
|
207,993 |
|
|
— |
|
|
73,500 |
|
|
— |
|
|
281,493 |
|
Paid-in-kind interest income |
|
310 |
|
|
— |
|
|
3,804 |
|
|
— |
|
|
4,114 |
|
Paid-in-kind dividend income |
|
— |
|
|
— |
|
|
— |
|
|
3,139 |
|
|
3,139 |
|
Proceeds from sale of investments and principal repayments |
|
(2,788 |
) |
|
— |
|
|
(15,110 |
) |
|
— |
|
|
(17,898 |
) |
Net change in unrealized gains (losses) on investments |
|
(5,808 |
) |
|
(10,137 |
) |
|
(41 |
) |
|
(776 |
) |
|
(16,762 |
) |
Net realized gains (losses) on investments |
|
— |
|
|
— |
|
|
(1 |
) |
|
— |
|
|
(1 |
) |
Net amortization of discount on investments |
|
467 |
|
|
137 |
|
|
108 |
|
|
— |
|
|
712 |
|
Transfers into (out of) Level 3 |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Fair value, end of period |
$ |
509,228 |
|
$ |
78,220 |
|
$ |
62,260 |
|
$ |
57,531 |
|
$ |
707,239 |
|
Net change in unrealized gains (losses) on non-controlled, non-affiliated investments still held at June 30, 2026 |
$ |
(5,808 |
) |
$ |
(10,137 |
) |
$ |
(41 |
) |
$ |
(776 |
) |
$ |
(16,762 |
) |
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For the Three Months Ended |
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June 30, 2025 |
|
|
First Lien Debt Investments |
|
Second Lien Debt Investments |
|
Unsecured and Subordinated Debt Investments |
|
Preferred Equity Investments |
|
Total Investments |
|
Fair value, beginning of period |
|
51,324 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
51,324 |
|
Purchases and originations of investments |
|
42,965 |
|
|
39,400 |
|
|
— |
|
|
— |
|
|
82,365 |
|
Paid-in-kind interest income |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Paid-in-kind dividend income |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Proceeds from sale of investments and principal repayments |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Net change in unrealized gains (losses) on investments |
|
(243 |
) |
|
103 |
|
|
— |
|
|
— |
|
|
(140 |
) |
Net realized gains (losses) on investments |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Net amortization of discount on investments |
|
39 |
|
|
17 |
|
|
— |
|
|
— |
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|
56 |
|
Transfers into (out of) Level 3 |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Fair value, end of period |
$ |
94,085 |
|
$ |
39,520 |
|
$ |
— |
|
$ |
— |
|
$ |
133,605 |
|
Net change in unrealized gains (losses) on non-controlled, non-affiliated investments still held at June 30, 2025 |
$ |
(243 |
) |
$ |
103 |
|
$ |
— |
|
$ |
— |
|
$ |
(140 |
) |
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For the Six Months Ended |
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June 30, 2025 |
|
|
First Lien Debt Investments |
|
Second Lien Debt Investments |
|
Unsecured and Subordinated Debt Investments |
|
Preferred Equity Investments |
|
Total Investments |
|
Fair value, beginning of period |
|
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
Purchases and originations of investments |
|
94,289 |
|
|
39,400 |
|
|
— |
|
|
— |
|
|
133,689 |
|
Paid-in-kind interest income |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Paid-in-kind dividend income |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Proceeds from sale of investments and principal repayments |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Net change in unrealized gains (losses) on investments |
|
(271 |
) |
|
103 |
|
|
— |
|
|
— |
|
|
(168 |
) |
Net realized gains (losses) on investments |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Net amortization of discount on investments |
|
67 |
|
|
17 |
|
|
— |
|
|
— |
|
|
84 |
|
Transfers into (out of) Level 3 |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Fair value, end of period |
$ |
94,085 |
|
$ |
39,520 |
|
$ |
— |
|
$ |
— |
|
$ |
133,605 |
|
Net change in unrealized gains (losses) on non-controlled, non-affiliated investments still held at June 30, 2025 |
$ |
(271 |
) |
$ |
103 |
|
$ |
— |
|
$ |
— |
|
$ |
(168 |
) |
Transfers between levels, if any, are recognized at the beginning of the period in which the transfer(s) occurs. During the three and six months ended June 30, 2026 and June 30, 2025, no investments were transferred into or out of Level 3. The following tables present the significant unobservable inputs of the Company’s Level 3 investments as of June 30, 2026 and December 31, 2025. The tables are not intended to be all-inclusive but instead capture the significant unobservable inputs relevant to the Company’s determination of fair value for the Level 3 investments.
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|
June 30, 2026 |
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Fair Value |
|
Valuation Technique |
Unobservable Input |
Range (Weighted Average)(1) |
Impact to Valuation from an Increase to Input |
First Lien debt investments |
$ |
484,509 |
|
Income approach |
Discount rate |
8.6% - 10.8% (9.4%) |
Decrease |
First Lien debt investments |
|
24,719 |
|
Recent Transaction |
Transaction Price |
99.1% - 99.1% (99.1%) |
Increase |
Second Lien debt investments |
|
78,220 |
|
Income approach |
Discount rate |
10.0% - 16.2% (13.1%) |
Decrease |
Unsecured and Subordinated debt investments |
|
62,260 |
|
Income approach |
Discount rate |
12.6% - 12.6% (12.6%) |
Decrease |
Preferred equity investments |
|
57,531 |
|
Income approach |
Discount rate |
12.2% - 12.2% (12.2%) |
Decrease |
Total |
$ |
707,239 |
|
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|
|
|
(1)The weighted average is calculated by weighing the significant unobservable input by the relative fair value of each investment in the category.
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|
December 31, 2025 |
|
Fair Value |
|
Valuation Technique |
Unobservable Input |
Range (Weighted Average)(1) |
Impact to Valuation from an Increase to Input |
First Lien debt investments |
$ |
259,231 |
|
Income approach |
Discount rate |
8.3% - 9.4% (8.8%) |
Decrease |
First Lien debt investments |
|
49,823 |
|
Recent Transaction |
Transaction Price |
99.0% - 99.5% (99.3%) |
Increase |
Second Lien debt investments |
|
88,220 |
|
Income approach |
Discount rate |
9.5% - 10.5% (10.1%) |
Decrease |
Preferred equity investments |
|
55,168 |
|
Recent Transaction |
Transaction Price |
98.0% - 98.0% (98.0%) |
Increase |
Total |
$ |
452,442 |
|
|
|
|
|
(1)The weighted average is calculated by weighing the significant unobservable input by the relative fair value of each investment in the category. The Company typically determines the fair value of its performing Level 3 debt investments utilizing a discounted cash flow analysis to estimate the fair value of the investments, specifically the yield method. The cash flows used in the discounted cash flow analysis represent the contractual interest, fee and principal payments through the investment’s expected maturity date. These cash flows are discounted at a rate that is calibrated to the initial transaction and monitored over time to adjust for changes in observed market spreads and yields since the issuance of the investment along with changes in company specific factors. Financial Instruments Not Carried at Fair Value Debt The carrying value of the Company’s Credit Facilities (as defined below) approximates its fair value, which is categorized as Level 3 within the fair value hierarchy, as of June 30, 2026 and December 31, 2025.
|