FAIR VALUE

12 Months Ended

Dec. 31, 2025

Fair Value Disclosures [Abstract]

FAIR VALUE

FAIR VALUE

Loans Held for Investment

The Company’s loans are typically valued using a yield analysis, which is typically performed for non-credit impaired loans to borrowers where the Company does not own a controlling equity position. Alternative valuation methodologies may be used as appropriate, and can include a market analysis, income analysis, or recovery analysis. To determine fair value using a yield analysis, a current price is imputed for the loan based upon an assessment of the expected market yield

for a similarly structured loan with a similar level of risk. In the yield analysis, the Company considers the current contractual interest rate, the maturity and other terms of the loan relative to risk of the company and the specific loan. A key determinant of risk, among other things, is the leverage through the loan relative to the enterprise value of the borrower. As loans held by the Company are substantially illiquid with no active loan market, the Company depends on primary market data, including newly funded loans, as well as secondary market data with respect to high-yield debt instruments and syndicated loans, as inputs in determining the appropriate market yield, as applicable.

The following tables present fair value measurements of loans held at fair value as of December 31, 2025 and 2024:

	Fair Value Measurement as of December 31, 2025
	Total		Level 1		Level 2		Level 3
Loans held at fair value	$	26,080,763	$	—	$	—	$	26,080,763
Total	$	26,080,763	$	—	$	—	$	26,080,763

	Fair Value Measurement as of December 31, 2024
	Total		Level 1		Level 2		Level 3
Loans held at fair value	$	30,510,804	$	—	$	—	$	30,510,804
Total	$	30,510,804	$	—	$	—	$	30,510,804

The following table presents changes in loans that use Level 3 inputs as of and for the year ended December 31, 2025:

	Year ended December 31, 2025
Total loans using Level 3 inputs at December 31, 2024	$	30,510,804
Change in unrealized losses on loans at fair value, net	(7,933,276)
Additional fundings	11,000,000
Original issue discount and other discounts, net of costs	(1,179,000)
Loan repayments	(6,317,765)
Total loans using Level 3 inputs at December 31, 2025	$	26,080,763

The change in unrealized losses included in the consolidated statements of operations attributable to loans held at fair value, categorized as Level 3, held as of December 31, 2025 is $(7,933,276).

The following tables summarize the significant unobservable inputs the Company used to value the loans categorized within Level 3 as of December 31, 2025 and 2024. The tables are not intended to be all-inclusive, but instead capture the significant unobservable inputs relevant to the Company’s determination of fair values.

	As of December 31, 2025
				Unobservable Input
	Fair Value		Primary Valuation Techniques	Input	Estimated Range	Weighted Average
Senior term loans	$	16,259,763	Recovery analysis	Recovery rate	31.60% - 37.90%	34.75%
Senior term loans	4,821,000		Yield analysis	Market yield	19.50% - 21.50%	20.50%
Senior term loans	5,000,000		Market quotes	Broker/dealer bids or quotes	N/A	N/A
Total investment	$	26,080,763

	As of December 31, 2024
				Unobservable Input
	Fair Value		Primary Valuation Techniques	Input	Estimated Range	Weighted Average
Senior term loan	$	30,510,804	Recovery analysis	Recovery rate	54.90% - 60.00%	57.45%
Total investment	$	30,510,804

Changes in market yields, revenue multiples, and recovery rates may change the fair value of certain of the Company’s loans. Generally, an increase in market yields may result in a decrease in the fair value of certain of the Company’s loans, while a decrease in revenue multiples and recovery rates may result in a decrease in the fair value of certain of the Company’s loans.

Due to the inherent uncertainty of determining the fair value of loans that do not have a readily available market value, the fair value of the Company’s loans may fluctuate from period to period. Additionally, the fair value of the Company’s loans may differ significantly from the values that would have been used had a ready market existed for such loans and may differ materially from the values that the Company may ultimately realize. Further, such loans are generally subject to legal and other restrictions on resale or otherwise are less liquid than publicly traded securities. If the Company was required to liquidate a loan in a forced or liquidation sale, it could realize significantly less than the value at which the Company has recorded it.

In addition, changes in the market environment and other events that may occur over the life of the loans may cause the gains or losses ultimately realized on these loans to be different than the unrealized gains or losses reflected in the valuations currently assigned.

Fair Value of Financial Instruments

GAAP requires disclosure of fair value information about financial instruments, whether or not recognized at fair value in the balance sheets, for which it is practicable to estimate that value.

The following table details the carrying value and fair value of the Company’s financial instruments not recognized at fair value in the consolidated balance sheets as of December 31, 2025:

	As of December 31, 2025
	Carrying Value		Fair Value
Financial assets:
Cash and cash equivalents	$	38,605,507	$	38,605,507
Loans held for investment at carrying value, net	$	253,625,119	$	207,805,490
Financial liabilities:
Senior notes payable, net	$	76,322,493	$	74,151,000

Cash and cash equivalents have a carrying value which approximates their fair value due to the short-term nature of these instruments. The Company categorizes the fair value measurement of these assets as Level 1. The Company’s loans held for investment are measured using unobservable inputs, or Level 3 inputs. The fair value of the Company’s 2027 Senior Notes is estimated using observable inputs based on the last available bid price in the market at the end of the period, or Level 2 inputs.