Note 4. Fair Value Measurements

Fair Value Disclosures

The following table presents fair value measurements of investments by major class, cash equivalents and derivatives as of June 30, 2026, according to the fair value hierarchy:


	Fair Value Measurements
		Level 1			Level 2				Level 3			Measured at Net Asset Value (2)			Total
Investments:
First Lien Senior Secured Loans	$	—		$	—			$		1,494,684	$		4,933	$		1,499,617
Second Lien Senior Secured Loans		—			—					30,069		—				30,069
Subordinated Debt		—			—					86,634		—				86,634
Preferred Equity		—			—					182,668		—				182,668
Equity Interests		—			—					168,672			8,116			176,788
Warrants		—			—					696		—				696
Subordinated Notes Investment Vehicles (1)		—			—					354,534		—				354,534
Preferred Equity Interests Investment Vehicles (1)		—			—				—				1,836			1,836
Equity Interests Investment Vehicles (1)		—			—				—				30,734			30,734
Total Investments	$	—		$	—			$		2,317,957	$		45,619	$		2,363,576
Cash equivalents	$		52,077	$	—			$	—		$	—		$		52,077
Forward currency exchange contracts (asset)	$	—		$		1,804		$	—		$	—		$		1,804
Forward currency exchange contracts (liability)	$	—		$		(1,105	)	$	—		$	—		$		(1,105	)
Interest rate swap (asset)	$	—		$		890		$	—		$	—		$		890
Interest rate swap (liability)	$	—		$		(4,621	)	$	—		$	—		$		(4,621	)

(1)

Includes debt and equity investment in ISLP and SLP.

(2)

In accordance with ASC Subtopic 820-10, Fair Value Measurements and Disclosures, or ASC 820-10, certain investments are measured using the net asset value per share (or its equivalent) as a practical expedient for fair value, and have not been classified in the fair value hierarchy.

The following table presents fair value measurements of investments by major class, cash equivalents and derivatives as of December 31, 2025, according to the fair value hierarchy:


	Fair Value Measurements
											Measured at
											Net Asset
	Level 1			Level 2				Level 3			Value (2)			Total
Investments:
First Lien Senior Secured Loans	$	—		$		2,610		$		1,591,538	$		4,583	$	1,598,731
Second Lien Senior Secured Loans		—			—					30,020		—			30,020
Subordinated Debt		—			—					95,687		—			95,687
Preferred Equity		—			—					157,244		—			157,244
Equity Interests		—			—					219,124			7,539		226,663
Warrants		—			—					1,045		—			1,045
Subordinated Notes Investment Vehicles (1)		—			—					348,654		—			348,654
Preferred Equity Interests Investment Vehicles (1)		—			—				—				1,836		1,836
Equity Interests Investment Vehicles (1)		—			—				—				48,561		48,561
Total Investments	$		—	$		2,610		$		2,443,312	$		62,519	$	2,508,441
Cash equivalents	$		38,814	$	—			$	—		$	—		$	38,814
Forward currency exchange contracts (liability)	$	—		$		(9,061	)	$	—		$	—		$	(9,061	)
Interest rate swap	$	—		$		7,976		$	—		$	—		$	7,976

(1)

Includes debt and equity investments in ISLP and SLP.

(2)

In accordance with ASC Subtopic 820‑10, Fair Value Measurements and Disclosures, or ASC 820‑10, certain investments are measured using the net asset value per share (or its equivalent) as a practical expedient for fair value, and have not been classified in the fair value hierarchy.

The following table provides a reconciliation of the beginning and ending balances for investments that use Level 3 inputs for the six months ended June 30, 2026:


	First Lien			Second Lien															Subordinated
	Senior			Senior															Notes in
	Secured			Secured			Subordinated			Preferred			Equity						Investment			Total
	Loans			Loans			Debt			Equity			Interests			Warrants			Vehicles (1)			Investments
Balance as of January 1, 2026	$	1,591,538		$	30,020		$	95,687		$	157,244		$	219,124		$	1,045		$	348,654		$	2,443,312
Purchases of investments and other adjustments to cost		377,503			—			3			18,783			2,402			—			8,985			407,676
Paid-in-kind interest income		12,115			—			6,052			1,272			—			—			—			19,439
Net accretion of discounts (amortization of premiums)		1,631			51			147			5			—			—			—			1,834
Principal repayments and sales of investments		(454,837	)		—			(13,733	)		(1,065	)		(59,984	)		—			—			(529,619	)
Net change in unrealized appreciation on investments		(17,963	)		(2	)		(2,047	)		5,378			17,544			(349	)		(3,105	)		(544	)
Net realized gain (loss) on investments		(15,303	)		—			525			1,051			(10,414	)		—			—			(24,141	)
Balance as of June 30, 2026	$	1,494,684		$	30,069		$	86,634		$	182,668		$	168,672		$	696		$	354,534		$	2,317,957
Change in unrealized appreciation attributable to investments still held at June 30, 2026	$	(27,987	)	$	(2	)	$	(1,427	)	$	5,378		$	7,710		$	(349	)	$	(3,105	)	$	(19,782	)

(1)

Represents debt investment in ISLP and SLP.

Transfers between levels, if any, are recognized at the beginning of the year in which transfers occur. For the six months ended June 30, 2026, transfers from Level 2 to Level 3, if any, were primarily due to decreased price transparency. For the six months ended June 30, 2026, transfers from Level 3 to Level 2, if any, were primarily due to increased price transparency.

The following table provides a reconciliation of the beginning and ending balances for investments that use Level 3 inputs for the year ended December 31, 2025:


	First Lien			Second Lien														Subordinated
	Senior			Senior														Notes in
	Secured			Secured			Subordinated			Preferred			Equity					Investment			Total
	Loans			Loans			Debt			Equity			Interests			Warrants		Vehicles (1)			Investments
Balance as of January 1, 2025	$	1,543,286		$	30,104		$	53,350		$	170,876		$	219,210		$	628	$	337,224		$	2,354,678
Purchases of investments and other adjustments to cost		1,170,550			9,670			29,393			33,316			14,528			—		23,500			1,280,957
Paid-in-kind interest		19,831			—			10,159			3,891			—			—		—			33,881
Net accretion of discounts (amortization of premiums)		4,875			64			203			3			(6	)		—		—			5,139
Principal repayments and sales of investments		(1,132,193	)		(9,597	)		—			(63,294	)		(26,091	)		—		—			(1,231,175	)
Net change in unrealized appreciation on investments		(2,937	)		18,817			(2,486	)		6,442			19,865			417		(12,070	)		28,048
Net realized gain (loss) on investments		(11,874	)		(19,038	)		—			11,078			(8,382	)		—		—			(28,216	)
Reclassifications		—			—			5,068			(5,068	)		—			—		—			—
Balance as of December 31, 2025	$	1,591,538			30,020			95,687			157,244			219,124			1,045		348,654		$	2,443,312
Change in unrealized appreciation attributable to investments still held at December 31, 2025	$	(14,211	)	$	(62	)	$	(2,581	)	$	13,107		$	15,856		$	417	$	(12,070	)	$	456

(1)

Represents debt investment in ISLP and SLP.

Transfers between levels, if any, are recognized at the beginning of the year in which transfers occur. For the year ended December 31, 2025, transfers from Level 2 to Level 3, if any, were primarily due to decreased price transparency. For the year ended December 31, 2025, transfers from Level 3 to Level 2, if any, were primarily due to increased price transparency.

Significant Unobservable Inputs

ASC 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 valuation techniques and significant unobservable inputs used in Level 3 fair value measurements of assets as of June 30, 2026 were as follows:


	As of June 30, 2026
				Significant
	Fair Value of			Unobservable	Range of Significant
	Level 3 Assets (1)		Valuation Technique	Inputs	Unobservable Inputs (3)						Weighted Average (2)
First Lien Senior Secured Loan	$	1,326,333	Discounted cash flows	Comparative Yield		6.3	%	—	32.4	%	11.5%
First Lien Senior Secured Loan		85,555	Comparable company multiple	EBITDA Multiple		7.8	x	—	15.0	x	9.2x
First Lien Senior Secured Loan		1,230	Comparable company multiple	Revenue Multiple				—			0.7x
First Lien Senior Secured Loan		10,635	Collateral Coverage	Recovery Rate				—			100.0%
Second Lien Senior Secured Loan		30,069	Discounted cash flows	Comparative Yield		12.8	%	—	14.1	%	13.6%
Subordinated Note Investment Vehicles		354,534	Collateral Coverage	Recovery Rate		91.0	%	—	100.0	%	95.8%
Subordinated Debt		86,634	Discounted cash flows	Comparative Yield		13.2	%	—	19.2	%	18.4%
Equity Interest		52,995	Discounted cash flows	Discount Rate				—			13.4%
Equity Interest		101,972	Comparable company multiple	EBITDA Multiple		4.5	x	—	34.5	x	12.8x
Equity Interest		6,790	Comparable company multiple	Revenue Multiple		3.7	x	—	7.8	x	6.4x
Equity Interest		5,524	Comparable company multiple	Book Value Multiple				—			1.3x
Preferred equity		29,650	Comparable company multiple	EBITDA Multiple		6.3	x	—	23.0	x	10.7x
Preferred equity		48,529	Comparable company multiple	Revenue Multiple		3.9	x	—	9.5	x	7.2x
Preferred equity		84,004	Comparable company multiple	Book Value Multiple				—			1.3x
Preferred equity		11,797	Discounted Cash Flows	Comparative Yield		13.6	%	—	18.7	%	16.9%
Preferred equity		4,906	Discounted Cash Flows	Discount Rate				—			13.0%
Warrants		696	Discounted Cash Flows	Discount Rate				—			25.0%
Total investments	$	2,241,853

(1)

Included within the Level 3 assets of $2,317,957 is an amount of $76,104 for which the Advisor did not develop the unobservable inputs for the determination of fair value (examples include single source quotation and prior or pending transactions such as investments originated in the quarter or imminent payoffs).

(2)

Weighted average is calculated by weighing the significant unobservable input by the relative fair value of each investment in the category.

(3)

The range for an asset category consisting of a single investment, if any, is not meaningful and therefore has been excluded.

The Company used the income approach and market approach to determine the fair value of certain Level 3 assets as of June 30, 2026. The significant unobservable inputs used in the income approach are the comparative yield and discount rate. The comparative yield and discount rate are used to discount the estimated future cash flows expected to be received from the underlying investment. An increase/decrease in the comparative yield or discount rate would result in a decrease/increase, respectively, in the fair value. The significant unobservable inputs used in the market approach are the comparable company multiple and the recovery rate. The comparable company multiple is used to estimate the enterprise value of the underlying investment. An increase/decrease in the multiple would result in an increase/decrease, respectively, in the fair value. The recovery rate represents the extent to which proceeds can be recovered. An increase/decrease in the recovery rate would result in an increase/decrease, respectively, in the fair value.

The valuation techniques and significant unobservable inputs used in Level 3 fair value measurements of assets as of December 31, 2025 were as follows:


	As of December 31, 2025
				Significant
	Fair Value of			Unobservable	Range of Significant
	Level 3 Assets (1)		Valuation Technique	Inputs	Unobservable Inputs (3)						Weighted Average (2)
First Lien Senior Secured Loans	$	1,425,578	Discounted cash flows	Comparative Yields	5.3		%	—	19.5	%	10.7%
First Lien Senior Secured Loans		74,416	Comparable company multiple	EBITDA Multiple		7.5	x	—	13.7	x	9.6x
First Lien Senior Secured Loans		4,454	Comparable company multiple	Revenue Multiple				—			0.7x
First Lien Senior Secured Loans		12,052	Collateral coverage	Recovery Rate				—			100.0%
Second Lien Senior Secured Loans		30,020	Discounted cash flows	Comparative Yields		12.9	%	—	13.1	%	13.0%
Subordinated Notes in Investment Vehicles		348,654	Collateral coverage	Recovery Rate		92.9	%	—	100.0	%	96.8%
Subordinated Debt		95,086	Discounted cash flows	Comparative Yields		11.5	%	—	21.5	%	18.3%
Equity Interests		47,423	Discounted cash flows	Discount Rate				—			13.4%
Equity Interests		97,564	Comparable company multiple	EBITDA Multiple		4.0	x	—	26.0	x	12.8x
Equity Interests		12,675	Comparable company multiple	Revenue Multiple		5.0	x	—	33.0	x	11.0x
Equity Interests		1,287	Comparable company multiple	Book Value Multiple				—			1.0x
Preferred Equity		27,328	Comparable company multiple	EBITDA Multiple		6.3	x	—	16.5	x	10.8x
Preferred Equity		50,135	Comparable company multiple	Revenue Multiple		3.5	x	—	10.9	x	7.9x
Preferred Equity		68,748	Comparable company multiple	Book Value Multiple				—			1.0x
Preferred Equity		7,037	Discounted cash flows	Comparative Yields				—			13.0%
Warrants		344	Comparable company multiple	Revenue Multiple				—			3.8x
Warrants		701	Discounted cash flows	Discount Rate				—			25.0%
Total investments	$	2,303,502

(1)

Included within the Level 3 assets of $2,443,312 is an amount of $139,810 for which the Advisor did not develop the unobservable inputs for the determination of fair value (examples include single source quotation and prior or pending transactions such as investments originated in the quarter or imminent payoffs).

(2)

Weighted average is calculated by weighing the significant unobservable input by the relative fair value of each investment in the category.

(3)

The range for an asset category consisting of a single investment, if any, is not meaningful and therefore has been excluded.

The Company used the income approach and market approach to determine the fair value of certain Level 3 assets as of December 31, 2025. The significant unobservable inputs used in the income approach are the comparative yield and discount rate. The comparative yield and discount rate are used to discount the estimated future cash flows expected to be received from the underlying investment. An increase/decrease in the comparative yield or discount rate would result in a decrease/increase, respectively, in the fair value. The significant unobservable inputs used in the market approach are the comparable company multiple and the recovery rate. The comparable company multiple is used to estimate the enterprise value of the underlying investment. An increase/decrease in the multiple would result in an increase/decrease, respectively, in the fair value. The recovery rate represents the extent to which proceeds can be recovered. An increase/decrease in the recovery rate would result in an increase/decrease, respectively, in the fair value.

Debt Not Carried at Fair Value

Fair value is estimated by using market quotations or discounting remaining payments using applicable current market rates, which take into account changes in the Company’s marketplace credit ratings, or market quotes, if available. If the Company’s debt obligations were carried at fair value, the fair value and level would have been as follows:


		As of
	Level	June 30, 2026		December 31, 2025
2019-1 Debt	2	$	271,440	$	272,182
March 2026 Notes	2		—		298,926
October 2026 Notes	2		298,292		295,222
March 2030 Notes	2		341,167		350,538
March 2031 Notes	2		338,581		—
Sumitomo Credit Facility	3		249,000		251,000
Total Debt		$	1,498,480	$	1,467,868

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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+ Details