Annual report [Section 13 and 15(d), not S-K Item 405]

INVESTMENTS (Tables)

v3.25.3
INVESTMENTS (Tables)
 12 Months Ended
Sep. 30, 2025
Investments, Debt and Equity Securities [Abstract]  
Schedule of Fair Value, Assets Measured on Recurring Basis
As of September 30, 2025 and 2024, 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 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 
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, 2024:
Secured first lien debt
 $ —  $ —  $ 554,937  $ 554,937 
Secured second lien debt
 —  —  113,716  113,716 
Unsecured debt
 —  — 

32 

32 
Preferred equity
 —  — 

31,346 

31,346 
Common equity/equivalents
 — 

—  96,191  96,191 
Total
 $ —  $ —  $ 796,222  $ 796,222 
Investments measured at NAV(A)
—  —  —  38 
Total Investments
 $ —  $ —  $ 796,222  $ 796,260 
Cash Equivalents
 2,157  —  —  2,157 
Total Investments and Cash Equivalents as of September 30, 2024
 $ 2,157  $ —  $ 796,222  $ 798,417 
(A)Includes our investments in Gladstone Alternative and Leeds as of September 30, 2025 and our investment in Leeds as of September 30, 2024. 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 annual 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 September 30, 2025 and 2024 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)
September 30,
2025		 September 30,
2024
Non-Control/Non-Affiliate Investments
Secured first lien debt $ 517,762  $ 540,661 
Secured second lien debt 131,750  105,169 
Unsecured debt 17  32 
Preferred equity 16,794  27,247 
Common equity/equivalents 29,958 
(A)
 77,757 
(B)
Total Non-Control/Non-Affiliate Investments $ 696,281  $ 750,866 
Affiliate Investments
Secured first lien debt $ 34,713  $ 380 
Preferred equity 9,420  4,099 
Common equity/equivalents 4,703  2,959 
Total Affiliate Investments $ 48,836  $ 7,438 
Control Investments
Secured first lien debt $ 69,896  $ 13,896 
Secured second lien debt 18,792  8,547 
Unsecured debt 316  — 
Preferred equity 5,000  — 
Common equity/equivalents 14,892  15,475 
Total Control Investments $ 108,896  $ 37,918 
Total Investments at Fair Value Using Level 3 Inputs $ 854,013  $ 796,222 

(A)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.
(B)Excludes our investment in Leeds with a fair value of $38 thousand as of September 30, 2024, which was valued using NAV as a practical expedient.
Schedule of Fair Value Measurement Inputs and Valuation Techniques 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
September 30,
2025		 September 30,
2024		 Valuation
Techniques/
Methodologies		 Unobservable
Input		 September 30,
2025		 September 30,
2024
Secured first lien debt $ 548,670  $ 464,090  Yield Analysis Discount Rate
9.4%–19.8% / 11.7%
10.8%–17.3% / 12.6%
73,701  90,847  TEV EBITDA multiple
3.5x–8.0x / 6.0x
4.1x–13.9x / 10.0x
EBITDA
$538–$4,655 / $3,540
$3,020–$16,211 / $10,309
Revenue multiple
0.6x–0.8x / 0.7x
0.2x–4.6x / 2.1x
Revenue
$10,844–$21,649 / $15,090
$6,336–$21,118 / $13,981
Secured second lien debt 141,750  101,928  Yield Analysis Discount Rate
11.4%–15.2% / 13.1%
12.2%—16.0% / 14.1%
—  3,241  Market Quote IBP N/A
88.0%–88.0% / 88.0%
8,792  8,547  TEV EBITDA multiple
5.4x–5.4x / 5.4x
5.4x–5.4x / 5.4x
EBITDA
$2,345–$2,345 / $2,345
$3,343–$3,343 / $3,343
Unsecured debt 333  32  TEV EBITDA multiple
8.0x–8.0x / 8.0x
0.0x–0.0x / 0.0x
EBITDA
$3,804–$3,804 / $3,804
$0–$0 / $0
Revenue multiple
0.9x–0.9x / 0.9x
1.0x–1.0x / 1.0x
Revenue
$4,846–$4,846 / $4,846
$7,834–$7,834 / $7,834
Preferred and common equity / equivalents(A)
80,767  127,537  TEV EBITDA multiple
3.5x–14.6x / 6.8x
4.1x–13.9x / 8.0x
EBITDA
$538–$142,549 / $10,222
$1,182–$144,458 / $10,847
Revenue multiple
0.6x–0.9x / 0.7x
0.2x–4.6x / 2.0x
Revenue
$4,846–$21,649 / $12,394
$4,672–$21,118 / $12,587
Total Level 3 Investments, at Fair Value $ 854,013  $ 796,222 
(A)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 as of September 30, 2024 excludes our investment in Leeds with a fair value of $38 thousand, which was valued using NAV as a practical expedient.
Schedule of Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation
The following tables provide the changes in fair value, broken out by security type, during the years ended September 30, 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)
Year Ended September 30, 2025 Secured 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)
(8,513) —  —  (946) 64,827  55,368 
Net unrealized appreciation (depreciation)(B)
(7,573) 285  (56) 6,510  7,179  6,345 
Reversal of prior period net depreciation (appreciation) on realization(B)
9,612  295  —  946  (60,010) (49,157)
New investments, repayments and settlements:(C)
Issuances/originations 322,603  57,958  357  12,762  3,026  396,706 
Settlements/repayments (240,195) (21,712) —  —  —  (261,907)
Net proceeds from sales —  —  —  (19,404) (70,160) (89,564)
Transfers (8,500) —  —  —  8,500  — 
Fair Value as of September 30, 2025 $ 622,371  $ 150,542  $ 333  $ 31,214  $ 49,553  $ 854,013 
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Year Ended September 30, 2024 Secured First
Lien Debt		 Secured
Second Lien
Debt		 Unsecured
Debt		 Preferred
Equity		 Common
Equity/
Equivalents		 Total
Fair Value as of September 30, 2023 $ 510,701  $ 127,854  $ 24  $ 26,855  $ 39,128  $ 704,562 
Total gains (losses):
Net realized gain (loss)(A)
(50) —  —  332  1,724  2,006 
Net unrealized appreciation (depreciation)(B)
(7,071) 2,445  8  (5,039) 52,781  43,124 
Reversal of prior period net depreciation (appreciation) on realization(B)
(53) (22) —  130  (283) (228)
New investments, repayments and settlements:(C)
Issuances/originations 131,462  36,978  —  10,150  4,585  183,175 
Settlements/repayments (80,102) (53,539) —  —  —  (133,641)
Net proceeds from sales 50  —  —  (1,082) (1,744) (2,776)
Transfers —  —  —  —  —  — 
Fair Value as of September 30, 2024 $ 554,937  $ 113,716  $ 32  $ 31,346  $ 96,191  $ 796,222 
(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.
Schedule of Investment Holdings
The following table outlines our investments by security type as of September 30, 2025 and 2024:
September 30, 2025 September 30, 2024
Cost Fair Value Cost Fair Value
Secured first lien debt $ 646,131  73.7  % $ 622,371  72.4  % $ 580,736  75.3  % $ 554,937  69.7  %
Secured second lien debt 149,937  17.1  150,542  17.5  113,691  14.8  113,716  14.3 
Unsecured debt 555  0.1  333  0.1  198  0.0  32  0.0 
Total debt investments 796,623  90.9  773,246  90.0  694,625  90.1  668,685  84.0 
Preferred equity 37,429  4.3  31,214  3.6  45,017  5.8  31,346  3.9 
Common equity/equivalents 42,562  4.8  54,664  6.4  31,369  4.1  96,229  12.1 
Total equity investments 79,991  9.1  85,878  10.0  76,386  9.9  127,575  16.0 
Total Investments $ 876,614  100.0  % $ 859,124  100.0  % $ 771,011  100.0  % $ 796,260  100.0  %
Our investments at fair value consisted of the following industry classifications as of September 30, 2025 and 2024:
Industry Classification September 30, 2025 September 30, 2024
Fair Value Percentage of
Total
Investments		 Fair Value Percentage of
Total
Investments
Healthcare, Education, and Childcare $ 273,262  31.8  % $ 101,707  12.8  %
Diversified/Conglomerate Manufacturing 202,466  23.6  160,264  20.1 
Diversified/Conglomerate Service 152,042  17.7  179,032  22.5 
Beverage, Food, and Tobacco 54,605  6.4  88,327  11.1 
Home and Office Furnishings, Housewares and Durable Consumer Products 30,000  3.5  —  — 
Automobile 27,361  3.2  28,286  3.6 
Machinery 26,381  3.1  21,816  2.7 
Personal, Food, and Miscellaneous Services 23,700  2.7  —  — 
Cargo Transportation 20,000  2.3  20,200  2.5 
Oil and Gas 17,512  2.0  20,554  2.6 
Personal and Non-Durable Consumer Products 13,866  1.6  13,586  1.7 
Printing and Publishing 5,809  0.7  4,312  0.5 
Aerospace and Defense 1,184  0.1  153,096  19.2 
Other, < 2.0% 10,936  1.3  5,080  0.7 
Total Investments $ 859,124  100.0  % $ 796,260  100.0  %
Our investments at fair value were included in the following U.S. geographic regions as of September 30, 2025 and 2024:
Location September 30, 2025 September 30, 2024
Fair Value Percentage of
Total
Investments		 Fair Value Percentage of
Total
Investments
South $ 287,371  33.5  % $ 314,010  39.4  %
Midwest 237,417  27.6  192,897  24.2 
West 233,564  27.2  249,082  31.3 
Northeast 100,772  11.7  40,271  5.1 
Total Investments $ 859,124  100.0  % $ 796,260  100.0  %
Schedule of Investments Classified by Contractual Maturity Date
The following table summarizes the contractual principal repayment and maturity of our investment portfolio by fiscal year, assuming no voluntary prepayments, as of September 30, 2025:
Year Ending September 30, Amount
2026(A)
$ 58,434 
2027 157,554 
2028 222,265 
2029 139,336 
2030 209,608 
Thereafter 10,000 
Total contractual repayments $ 797,197 
Adjustments to cost basis of debt investments (574)
Investments in equity securities 79,991 
Investments held as of September 30, 2025 at cost: $ 876,614 
(A)Includes debt investments with contractual principal amounts totaling $0.5 million for which the maturity date has passed as of September 30, 2025.