Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2024

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Under existing accounting guidance, fair value is defined as the price that the Company would receive upon selling an investment or would pay to transfer a liability in an orderly transaction to a market participant in the principal or most advantageous market for the investment. This accounting guidance emphasizes valuation techniques that maximize the use of observable market inputs and minimize the use of unobservable inputs. Inputs refer broadly to the assumptions that market participants would use in

pricing an asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the circumstances. The Company classifies the inputs used to measure these fair values into the following hierarchy as defined by current accounting guidance:

Level 1: Inputs that are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: Inputs that are quoted prices for similar assets or liabilities in active markets.

Level 3: Inputs that are unobservable for an asset or liability.

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

As of December 31, 2024 and 2023, the Company’s investments were categorized as follows in the fair value hierarchy:

Valuation Inputs	December 31, 2024		December 31, 2023
Level 1—Price quotations in active markets	$	—	$	—
Level 2—Significant other observable inputs	41,655		1,614
Level 3—Significant unobservable inputs	1,022,418		262,316
	$	1,064,073	$	263,930

In addition, the Company had foreign currency forward contracts, as described in Note 7, which were categorized as Level 2 in the fair value hierarchy as of December 31, 2024.

The Board is responsible for overseeing the valuation of the Company’s portfolio investments at fair value as determined in good faith pursuant to the Adviser’s valuation policy. The Board has designated the Adviser as the Company’s valuation designee, with day-to-day responsibility for implementing the portfolio valuation process set forth in the Adviser’s valuation policy.

The Company’s investments consist primarily of debt investments that were acquired directly from the issuer. Debt investments, for which broker quotes are not available, are valued by independent valuation firms, which determine the fair value of such investments by considering, among other factors, the borrower’s ability to adequately service its debt, prevailing interest rates for like investments, expected cash flows, call features, anticipated repayments and other relevant terms of the investments. Except as described below, all of the Company’s equity/other investments are also valued by independent valuation firms, which determine the fair value of such investments by considering, among other factors, contractual rights ascribed to such investments, as well as various income scenarios and multiples of earnings before interest, taxes, depreciation and amortization, or EBITDA, cash flows, net income, revenues or, in limited instances, book value or liquidation value. An investment that is newly issued and purchased near the date of the financial statements is valued at cost if the Adviser determines that the cost of such investment is the best indication of its fair value. Such investments described above are typically classified as Level 3 within the fair value hierarchy. Investments that are traded on an active public market are valued at their closing price as of the date of the financial statements and are classified as Level 1 within the fair value hierarchy. Except as described above, the Adviser typically values the Company’s other investments by using the midpoint of the prevailing bid and ask prices from dealers on the date of the relevant period end, which are provided by independent third-party pricing services and screened for validity by such services and are typically classified as Level 2 within the fair value hierarchy.

The Adviser periodically benchmarks the bid and ask prices it receives from the third-party pricing services and/or dealers and independent valuation firms, as applicable, against the actual prices at which the Company purchases and sells its investments. Based on the results of the benchmark analysis and the experience of the Company’s management in purchasing and selling these investments, the Adviser believes that these prices are reliable indicators of fair value. The Adviser reviewed and approved the valuation determinations made with respect to these investments in a manner consistent with the Adviser’s valuation policy.

The following is a reconciliation of investments for which significant unobservable inputs (Level 3) were used in determining fair value for the years ended December 31, 2024 and 2023:

	For the Year Ended December 31, 2024
	Senior Secured Loans—First Lien		Subordinated Debt		Asset Based Finance		Total
Fair value at beginning of period	$	204,314	$	961	$	57,041	$	262,316
Accretion of discount (amortization of premium)	674		3		327		1,004
Net realized gain (loss)	(26)		—		10		(16)
Net change in unrealized appreciation (depreciation)	4,998		(3)		2,574		7,569
Purchases	683,099		485		149,812		833,396
Paid-in-kind interest	1,157		221		715		2,093
Sales and repayments	(28,728)		—		(55,216)		(83,944)
Transfers into Level 3	—		—		—		—
Transfers out of Level 3	—		—		—		—
Fair value at end of period	$	865,488	$	1,667	$	155,263	$	1,022,418
The amount of total gains or (losses) for the period included in changes in net assets attributable to the change in unrealized gains or losses relating to investments still held at the reporting date	$	4,963	$	(3)	$	2,574	$	7,534

	For the Year Ended December 31, 2023
	Senior Secured Loans—First Lien		Subordinated Debt		Asset Based Finance		Total
Fair value at beginning of period	$	2,646	$	—	$	3,485	$	6,131
Accretion of discount (amortization of premium)	554		1		8		563
Net realized gain (loss)	(4)		—		—		(4)
Net change in unrealized appreciation (depreciation)	2,520		(12)		881		3,389
Purchases	204,802		947		54,339		260,088
Paid-in-kind interest	—		25		—		25
Sales and repayments	(6,204)		—		(1,672)		(7,876)
Transfers into Level 3	—		—		—		—
Transfers out of Level 3	—		—		—		—
Fair value at end of period	$	204,314	$	961	$	57,041	$	262,316
The amount of total gains or (losses) for the period included in changes in net assets attributable to the change in unrealized gains or losses relating to investments still held at the reporting date	$	2,533	$	(12)	$	881	$	3,402

The valuation techniques and significant unobservable inputs used in recurring Level 3 fair value measurements as of December 31, 2024 and 2023 were as follows:

Type of Investment	Fair Value at December 31, 2024		Valuation Technique	Unobservable Input	Range (Weighted Average)	Impact to Valuation from an Increase in Input(1)
Senior Debt	$	855,090	Discounted Cash Flow	Discount Rate	7.6% - 11.4% (9.5%)	Decrease
	10,398		Cost(3)
Subordinated Debt	1,667		Discounted Cash Flow	Discount Rate	15.4% - 15.4% (15.4%)	Decrease
Asset Based Finance	139,551		Discounted Cash Flow	Discount Rate	4.8% - 41.7% (9.9%)	Decrease
	3,516		Waterfall	EBITDA Multiple	1.1x - 1.1x (1.1x)	Increase
	12,196		Cost(3)
Total	$	1,022,418

Type of Investment	Fair Value at December 31, 2023		Valuation Technique	Unobservable Input	Range (Weighted Average)	Impact to Valuation from an Increase in Input(1)
Senior Debt	$	185,976	Discounted Cash Flow	Discount Rate	10.0% - 11.5% (10.9%)	Decrease
	18,338		Cost(3)
Subordinated Debt	961		Discounted Cash Flow	Discount Rate	15.4% - 15.4% (15.4%)	Decrease
Asset Based Finance	39,896		Discounted Cash Flow	Discount Rate	5.9% - 43.2% (8.0%)	Decrease
	2,679		Waterfall	EBITDA Multiple	1.0x - 1.0x (1.0x)	Increase
	292		Other(2)
	14,174		Cost(3)
Total	$	262,316

__________

(1)Represents the directional change in the fair value of the Level 3 investments that would result from an increase to the corresponding unobservable input. A decrease to the input would have the opposite effect. Significant changes in these inputs in isolation could result in significantly higher or lower fair value measurements.

(2)Fair value based on expected outcome of proposed corporate transactions and/or other factors.

(3)Fair value was determined based on recent transaction pricing with no material changes in operations of the related portfolio company since the transaction date.