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INVESTMENTS
 3 Months Ended
Dec. 31, 2025
Investments, Debt and Equity Securities [Abstract]  
INVESTMENTS INVESTMENTS
Fair Value
In accordance with ASC 820, the fair value of each investment is determined to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between willing market participants on the measurement date. This fair value definition focuses on exit price in the principal, or most advantageous, market and prioritizes, within a measurement of fair value, the use of market-based inputs over entity-specific inputs. ASC 820 also establishes the following three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of a financial instrument as of the measurement date.
•Level 1 — inputs to the valuation methodology are quoted prices (unadjusted) for identical financial instruments in active markets;
•Level 2 — inputs to the valuation methodology include quoted prices for similar financial instruments in active or inactive markets, and inputs that are observable for the financial instrument, either directly or indirectly, for substantially the full term of the financial instrument. Level 2 inputs are in those markets for which there are few transactions, the prices are not current, little public information exists or instances where prices vary substantially over time or among brokered market makers; and
•Level 3 — inputs to the valuation methodology are unobservable and significant to the fair value measurement. Unobservable inputs are those inputs that reflect assumptions that market participants would use when pricing the financial instrument and can include the Valuation Team’s assumptions based upon the best available information.
When a determination is made to classify our investments within Level 3 of the valuation hierarchy, such determination is based upon the significance of the unobservable factors to the overall fair value measurement. However, Level 3 financial instruments typically include, in addition to the unobservable, or Level 3, inputs, observable inputs (or components that are actively quoted and can be validated to external sources). The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. Investments in funds measured using NAV as a practical expedient are not categorized within the fair value hierarchy.
As of December 31, 2025, all of our investments were valued using Level 3 inputs within the ASC 820 fair value hierarchy, except for our investments in money market funds, which were valued using Level 1 inputs, and our investment in Gladstone Alternative Income Fund (“Gladstone Alternative”), which was valued using NAV as a practical expedient. As of September 30, 2025, all of our investments were valued using Level 3 inputs within the ASC 820 fair value hierarchy, except for our investments in money market funds, which were valued using Level 1 inputs, and our investments in Gladstone Alternative and Leeds Novamark Capital I, L.P. (“Leeds”), which were valued using NAV as a practical expedient.
We transfer investments in and out of Level 1, 2, and 3 of the valuation hierarchy as of the beginning balance sheet date, based on changes in the use of observable and unobservable inputs utilized to perform the valuation for the period. During the three months ended December 31, 2025 and 2024, there were no investments transferred into or out of Levels 1, 2 or 3 of the valuation hierarchy.
As of December 31, 2025 and September 30, 2025, our investments, by security type, at fair value were categorized as follows within the ASC 820 fair value hierarchy:
Fair Value Measurements
Quoted Prices in
Active Markets
for Identical Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Fair Value
As of December 31, 2025:
Secured first lien debt
$— $— $647,576 $647,576 
Secured second lien debt
— — 170,662 170,662 
Unsecured debt
— — 346 

346 
Preferred equity
— — 36,761 

36,761 
Common equity/equivalents
— 

— 42,492 42,492 
Total
$— $— $897,837 $897,837 
Investments measured at NAV(A)
— — — 5,075 
Total Investments
$— $— $897,837 $902,912 
Cash Equivalents
1,253 — — 1,253 
Total Investments and Cash Equivalents as of December 31, 2025
$1,253 $— $897,837 $904,165 
Fair Value Measurements
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Fair Value
As of September 30, 2025:
Secured first lien debt
$— $— $622,371 $622,371 
Secured second lien debt
— — 150,542 150,542 
Unsecured debt
— — 

333 

333 
Preferred equity
— — 

31,214 

31,214 
Common equity/equivalents
— 

— 49,553 49,553 
Total
$— $— $854,013 $854,013 
Investments measured at NAV(A)
— — — 5,111 
Total Investments
$— $— $854,013 $859,124 
Cash Equivalents
31,774 — — 31,774 
Total Investments and Cash Equivalents as of September 30, 2025
$31,774 $— $854,013 $890,898 
(A)Includes our investment in Gladstone Alternative as of December 31, 2025 and our investments in Gladstone Alternative and Leeds as of September 30, 2025. Investments that are measured at fair value using NAV as a practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented elsewhere in this quarterly report.
The following table presents our portfolio investments, valued using Level 3 inputs within the ASC 820 fair value hierarchy and carried at fair value as of December 31, 2025 and September 30, 2025, by caption on our accompanying Consolidated Statements of Assets and Liabilities and by security type:
Total Recurring Fair Value Measurements Reported in
Consolidated Statements of Assets and Liabilities
Using Significant Unobservable Inputs (Level 3)
December 31, 2025September 30, 2025
Non-Control/Non-Affiliate Investments
Secured first lien debt$540,903 $517,762 
Secured second lien debt151,870 131,750 
Unsecured debt16 17 
Preferred equity22,643 16,794 
Common equity/equivalents27,981 29,958 
(B)
Total Non-Control/Non-Affiliate Investments
$743,413 $696,281 
Affiliate Investments
Secured first lien debt$33,251 $34,713 
Preferred equity8,648 9,420 
Common equity/equivalents4,817 
(A)
4,703 
(B)
Total Affiliate Investments$46,716 $48,836 
Control Investments
Secured first lien debt$73,422 $69,896 
Secured second lien debt18,792 18,792 
Unsecured debt330 316 
Preferred equity5,470 5,000 
Common equity/equivalents9,694 14,892 
Total Control Investments
$107,708 $108,896 
Total Investments at Fair Value Using Level 3 Inputs$897,837 $854,013 
(A)Excludes our investment in Gladstone Alternative with a fair value of $5.1 million as of December 31, 2025, which was valued using NAV as a practical expedient.
(B)Excludes our investments in Gladstone Alternative and Leeds with fair values of $5.1 million and $36 thousand, respectively, as of September 30, 2025, which were valued using NAV as a practical expedient.

In accordance with ASC 820, the following table provides quantitative information about our Level 3 fair value measurements of our investments as of December 31, 2025 and September 30, 2025. The table below is not intended to be all-inclusive, but rather provides information on the significant Level 3 inputs as they relate to our fair value measurements.
The weighted average calculations in the table below are based on the principal balances for all debt related calculations and on the cost basis for all equity related calculations for the particular input.
Quantitative Information about Level 3 Fair Value Measurements

Range / Weighted Average as of

December 31,
2025		September 30,
2025
Valuation
Techniques/
Methodologies
Unobservable
Input
December 31,
2025		September 30,
2025


Secured first lien debt(A)
$570,154 $548,670 
Yield Analysis
Discount Rate
9.0% - 18.0%
/ 11.2%
9.4% - 19.8%
/ 11.7%

77,422 73,701 
TEV
EBITDA multiple
3.6x – 8.3x
/ 6.2x
3.5x – 8.0x
/ 6.0x


EBITDA
$490 - $4,266
/ $3,485
$538 - $4,655
/ $3,540


Revenue multiple
0.6x – 0.8x
/ 0.7x
0.6x – 0.8x
/ 0.7x


Revenue
$8,268 - $22,244
/ $14,884
$10,844 - $21,649
/ $15,090


Secured second lien debt
151,870 141,750 
Yield Analysis
Discount Rate
11.1% - 14.8%
/ 12.3%
11.4% - 15.2%
/ 13.1%

18,792 8,792 
TEV
EBITDA multiple
5.0x – 5.6x
/ 5.3x
5.4x – 5.4x
/ 5.4x


EBITDA
$2,355 - $11,359
/ $7,146
$2,345 - $2,345
/ $2,345


Unsecured debt
346 333 
TEV
EBITDA multiple
8.3x – 8.3x
/ 8.3x
8.0x – 8.0x
/ 8.0x
EBITDA
$3,755 - $3,755
/ $3,755
$3,804 - $3,804
/ $3,804
Revenue multiple
0.9x – 0.9x
/ 0.9x
0.9x – 0.9x
/ 0.9x


Revenue
$4,708 - $4,708
/ $4,708
$4,846 - $4,846
/ $4,846


Preferred and common equity / equivalents(B)
79,253 80,767 
TEV
EBITDA multiple
3.6x – 15.1x
/ 7.0x
3.5x – 14.6x
/ 6.8x


EBITDA
$490 -$143,118
/ $9,727
$538 -$142,549
/ $10,222


Revenue multiple
0.6x – 0.9x
/ 0.7x
0.6x– 0.9x
/ 0.7x


Revenue
$4,708 -$22,244
/ $11,209
$4,846 -$21,649
/ $12,394
Total Level 3 Investments, at Fair Value
$897,837 $854,013 

(A)Fair value as of December 31, 2025 includes one proprietary debt investment totaling $43.6 million, which was valued using the payoff amount as the unobservable input.
(B)Fair value as of December 31, 2025 excludes our investment in Gladstone Alternative with a fair value of $5.1 million, which was valued using NAV as a practical expedient. Fair value as of September 30, 2025 includes one proprietary equity investment totaling $2.2 million, which was valued using the payoff amount as the unobservable input. Fair value as of September 30, 2025 excludes our investments in Gladstone Alternative and Leeds with fair values of $5.1 million and $36 thousand, respectively, which were valued using NAV as a practical expedient.

Fair value measurements can be sensitive to changes in one or more of the valuation inputs. Changes in discount rates, EBITDA or EBITDA multiples (or revenue or revenue multiples), each in isolation, may change the fair value of certain of our investments. Generally, an increase/(decrease) in market yields, discount rates, or a (decrease)/increase in EBITDA or EBITDA multiples (or revenue or revenue multiples) may result in a (decrease)/increase, respectively, in the fair value of certain of our investments.
Changes in Level 3 Fair Value Measurements of Investments
The following tables provide the changes in fair value, broken out by security type, during the three months ended December 31, 2025 and 2024 for all investments for which we determine fair value using unobservable (Level 3) inputs.

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Three months ended December 31, 2025Secured
First Lien
Debt		Secured
Second Lien
Debt		Unsecured
Debt		Preferred
Equity		Common
Equity/
Equivalents		Total
Fair Value as of September 30, 2025$622,371 $150,542 $333 $31,214 $49,553 $854,013 
Total gains (losses):
Net realized gain (loss)(A)
(112)— — — 1,790 1,678 
Net unrealized appreciation (depreciation)(B)
(23)739 — 607 (4,821)(3,498)
Reversal of prior period net depreciation (appreciation) on realization(B)
(169)(145)— — (1,790)(2,104)
New investments, repayments and settlements: (C)
Issuances/originations
57,276 39,071 13 4,940 — 101,300 
Settlements/repayments
(31,767)(19,545)— — — (51,312)
Net proceeds from sales
— — — — (2,240)(2,240)
Fair Value as of December 31, 2025
$647,576 $170,662 $346 $36,761 $42,492 $897,837 

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Three Months Ended December 31, 2024Secured
First Lien
Debt		Secured
Second Lien
Debt		Unsecured
Debt		Preferred
Equity		Common
Equity/
Equivalents		Total
Fair Value as of September 30, 2024$554,937 $113,716 $32 $31,346 $96,191 $796,222 
Total gains (losses):
Net realized gain (loss)(A)
(4,074)— — 2,450 59,348 57,724 
Net unrealized appreciation (depreciation)(B)
(3,534)115 5 3,136 12,396 12,118 
Reversal of prior period net depreciation (appreciation) on realization(B)
3,581 — — (2,450)(55,140)(54,009)
New investments, repayments and settlements: (C)
Issuances/originations
111,754 29,244 322 6,262 — 147,582 
Settlements/repayments
(76,255)(15,841)— — — (92,096)
Net proceeds from sales
— — — (9,450)(63,631)(73,081)
Fair Value as of December 31, 2024
$586,409 $127,234 $359 $31,294 $49,164 $794,460 
(A)Included in net realized gain (loss) on investments on our accompanying Consolidated Statements of Operations for the corresponding period.
(B)Included in net unrealized appreciation (depreciation) on investments on our accompanying Consolidated Statements of Operations for the corresponding period.
(C)Includes increases in the cost basis of investments resulting from new portfolio investments, accretion of discounts, PIK, and other non-cash disbursements to portfolio companies, as well as decreases in the cost basis of investments resulting from principal repayments or sales, the amortization of premiums and acquisition costs and other cost-basis adjustments.
Investment Activity
During the three months ended December 31, 2025, the following significant investment transactions occurred:

•In October 2025, we invested $11.0 million in Total Access Elevator, LLC (“Total Access”), an existing portfolio company, through secured first lien debt. We also extended Total Access a new $9.85 million delayed draw term loan commitment, which was unfunded at close.
•In October 2025, our $28.1 million debt investment in Leadpoint Business Services, LLC paid off at par. We also received a $0.3 million prepayment penalty in conjunction with the payoff.
•In October 2025, the sale of our remaining common equity investment in Sokol & Company Holdings, LLC (“Sokol”) was completed, representing a return of our equity cost basis of $0.5 million and a realized gain of approximately $1.8 million.
•In October 2025, our $17.8 million debt investment in Sea Link International IRB, Inc. (“Sea Link”) paid off at par. We also received a $0.2 million exit fee in conjunction with the payoff. We continue to hold common and preferred equity in Sea Link.
•In November 2025, we invested $15.0 million in Turn Key Health Clinics, LLC (“Turn Key”), an existing portfolio company, through secured first lien debt. We also increased our existing line of credit commitment to Turn Key by $1.0 million to $5.0 million, which was unfunded at close.
•In November 2025, we invested $26.6 million in Sicilian Oven Restaurants LLC through secured first lien debt and preferred equity.
•In December 2025, we invested $30.0 million in RPM Freight Systems, LLC, an existing portfolio company, through secured second lien debt.
•In December 2025, we invested $11.3 million in Flexible Technology Solutions, LLC through secured second lien debt and preferred equity.
Investment Concentrations
As of December 31, 2025, our investment portfolio consisted of investments in 54 portfolio companies located in 22 states in 16 different industries, with an aggregate fair value of $902.9 million. The five largest investments at fair value as of December 31, 2025 totaled $215.7 million, or 23.9% of our total investment portfolio, as compared to the five largest investments at fair value as of September 30, 2025 totaling $196.5 million, or 22.9% of our total investment portfolio. As of December 31, 2025 and September 30, 2025, our average investment by obligor was $17.1 million and $15.9 million at cost, respectively.
The following table outlines our investments by security type as of December 31, 2025 and September 30, 2025:
December 31, 2025September 30, 2025
CostFair ValueCostFair Value
Secured first lien debt$671,528 72.5 %$647,576 71.7 %$646,131 73.7 %$622,371 72.4 %
Secured second lien debt169,463 18.3 170,662 18.9 149,937 17.1 150,542 17.5 
Unsecured debt568 0.1 346 0.0 555 0.1 333 0.1 
Total debt investments841,559 90.9 818,584 90.6 796,623 90.9 773,246 90.0 
Preferred equity42,369 4.6 36,761 4.1 37,429 4.3 31,214 3.6 
Common equity/equivalents42,112 4.5 47,567 5.3 42,562 4.8 54,664 6.4 
Total equity investments
84,481 9.1 84,328 9.4 79,991 9.1 85,878 10.0 
Total Investments
$926,040 100.0 %$902,912 100.0 %$876,614 100.0 %$859,124 100.0 %
Our investments at fair value consisted of the following industry classifications as of December 31, 2025 and September 30, 2025:
December 31, 2025September 30, 2025
Industry ClassificationFair ValuePercentage of
Total
Investments		Fair ValuePercentage of
Total
Investments
Healthcare, Education, and Childcare$288,403 31.9 %$273,262 31.8 %
Diversified/Conglomerate Manufacturing203,153 22.5 202,466 23.6 
Diversified/Conglomerate Service146,845 16.3 152,042 17.7 
Beverage, Food, and Tobacco77,921 8.6 54,605 6.4 
Cargo Transportation50,000 5.5 20,000 2.3 
Home and Office Furnishings, Housewares and Durable Consumer Products29,928 3.3 30,000 3.5 
Machinery
26,467 3.0 26,381 3.1 
Personal, Food, and Miscellaneous Supplies22,751 2.5 23,700 2.7 
Oil and Gas
16,746 1.9 17,512 2.0 
Personal and Non-Durable Consumer Products13,576 1.5 13,866 1.6 
Automobile9,264 1.0 27,361 3.2 
Printing and Publishing5,365 0.6 5,809 0.7 
Other, < 2.0%
12,493 1.4 12,120 1.4 
Total Investments$902,912 100.0 %$859,124 100.0 %
Our investments at fair value were included in the following U.S. geographic regions as of December 31, 2025 and September 30, 2025:
December 31, 2025September 30, 2025
Location
Fair Value
Percentage of
Total
Investments
Fair Value
Percentage of
Total Investments
South$320,014 35.4 %$287,371 33.5 %
Midwest266,400 29.5 237,417 27.6 
West213,878 23.7 233,564 27.2 
Northeast102,620 11.4 100,772 11.7 
Total Investments$902,912 100.0 %$859,124 100.0 %
The geographic composition indicates the location of the headquarters for our portfolio companies. A portfolio company may have additional locations in other geographic regions.
Investment Principal Repayments
The following table summarizes the contractual principal repayment and maturity of our investment portfolio by fiscal year, assuming no voluntary prepayments, as of December 31, 2025:
Amount
For the remaining nine months ending September 30:
2026(A)
$22,553 
For the fiscal years ending September 30:
2027130,873 

2028200,051 

2029146,569 

2030239,554 

Thereafter103,360 

Total contractual repayments
$842,960 

Adjustments to cost basis of debt investments(1,401)

Investments in equity securities84,481 

Investments held as of December 31, 2025 at cost:
$926,040 
(A)Includes debt investments with contractual principal amounts totaling $0.4 million for which the maturity date has passed as of December 31, 2025.
Receivables from Portfolio Companies
Receivables from portfolio companies represent non-recurring costs incurred on behalf of such portfolio companies and are included in other assets on our accompanying Consolidated Statements of Assets and Liabilities. We generally maintain an allowance for uncollectible receivables from portfolio companies when the receivable balance becomes 90 days or more past due or if it is determined, based upon management’s judgment, that the portfolio company is unable to pay its obligations. We write off accounts receivable when we have exhausted collection efforts and have deemed the receivables uncollectible. As of December 31, 2025 and September 30, 2025, we had gross receivables from portfolio companies of $2.7 million and $2.4 million, respectively. The allowance for uncollectible receivables was $54 thousand and $52 thousand as of December 31, 2025 and September 30, 2025, respectively.