Note 4. Investments and Fair Value Measurements

Generally, under the 1940 Act, the Company would be presumed to “control” a portfolio company if it owned more than 25% of its voting securities or it had the power to exercise control over the management or policies of such portfolio company, and would be an “affiliated person” of a portfolio company if it owned 5% or more of its voting securities. “Non-affiliated investments” are defined as investments that are neither controlled investments nor affiliated investments.

As of June 30, 2026 and December 31, 2025, the Company did not “control” and was not an “affiliated person” of any of its portfolio companies, as defined in the 1940 Act. Detailed information with respect to the Company’s non-controlled, non-affiliated and non-controlled, affiliated investments is included in the accompanying consolidated financial statements, including the consolidated schedule of investments.

As of June 30, 2026, the valuation method used for certain investments classified as “Healthcare & Pharmaceuticals” amounting to $3.3 million changed from enterprise value waterfall valuation method to the discounted cash flow valuation method. The change was due to changing market conditions and is intended to more accurately reflect the go forward performance of such investments.

As of December 31, 2025, the valuation method used for certain investments classified as “Wholesale” amounting to $5.6 million changed from yield analysis valuation method to the enterprise value waterfall valuation method. The change was due to changing market conditions and is intended to more accurately reflect the go forward performance of such investments.

The Company typically determines the fair value of its performing Level 3 debt investments utilizing a discounted cash flow analysis or yield analysis. To conduct a discounted cash flow analysis, a price is ascribed for each investment based upon projected cash flows in the valuation models. The significant unobservable inputs used in the fair value measurement of the Level 3 investments include the discount rate applied in the valuation models to determine the present value of the projected cash flows. Increases in the discount rate can significantly lower the fair value of an investment; conversely, decreases in the discount rate can significantly increase the fair value of an investment. The discount rate is determined based on the market rates an investor would expect for a similar investment with similar risks. To conduct a yield analysis, a price is ascribed for each investment based upon an assessment of current and expected market yields for similar investments and investments with similar risk profiles. Additional consideration is given to the expected life of the investment, portfolio company performance since the date of investment, and other terms and risks associated with the investment. Among other factors, a determinant of risk is the amount of leverage used by the portfolio company relative to its total enterprise value, and the rights and remedies of the Company’s investment within the portfolio company’s capital structure.

When the debtor is not performing or when there is insufficient value to cover the investment, the Company may utilize an enterprise value waterfall approach to determine the fair value of debt investments in the applicable portfolio companies. An enterprise value waterfall analysis typically consists of two steps. First, the total enterprise value for the portfolio company is estimated using standard valuation approaches, most commonly the market approach. Second, the fair value for each investment in the portfolio company is then estimated by allocating the portfolio company’s total enterprise value to the outstanding securities in the

capital structure based upon various factors, including seniority, preferences, and other features if deemed relevant to each security in the capital structure.

Significant unobservable quantitative inputs typically used in the fair value measurement of the Company’s Level 3 debt investments primarily include discount rates and current market yields, including relevant market indices, but may also include quotes from brokers, dealers, and pricing services as indicated by comparable investments. For the Company’s Level 3 equity investments, an enterprise value analysis, based on comparable financial performance multiples such as publicly-traded company and comparable market transaction multiples of revenues, earnings before income taxes, depreciation and amortization (“EBITDA”), or some combination thereof and comparable market transactions typically would be used.