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Fair value of Financial Instruments (Tables)

9 Months Ended

Jun. 30, 2024

Fair Value Disclosures [Abstract]

Summary of Unobservable Inputs and Ranges

Our Level 3 valuation techniques, unobservable inputs and ranges were categorized as follows for ASC 820 purposes ($ in thousands):

Asset Category		Fair value at June 30, 2024				Valuation Technique		Unobservable Input		Range of Input (Weighted Average) (1)
First lien		$	56,443			Market Comparable		Broker/Dealer bids or quotes		N/A
First lien			1,386,217			Market Comparable		Market yield		6.4% - 20.6% (10.2%)
First lien			6,546			Enterprise Market Value		EBITDA multiple		8x
Second lien			150			Market Comparable		Market yield		14.4%
Subordinated debt			1,003			Market Comparable		Market yield		15.0%
Equity			139,743			Enterprise Market Value		EBITDA multiple		3.5x - 21.8x (11.4x)
Total Level 3 investments		$	1,590,101
Long-Term Credit Facility		$	218,862			Market Comparable		Market yield		2.0%

____________________________________________

(1)The weighted averages disclosed in the table above were weighted by their relative fair value.

Asset Category		Fair value at September 30, 2023				Valuation Technique		Unobservable Input		Range of Input (Weighted Average) (1)
First lien		$	25,521			Market Comparable		Broker/Dealer bids or quotes		N/A
First lien			875,133			Market Comparable		Market Yield		10.0% - 25.0% (12.6%)
First lien			5,512			Enterprise Market Value		EBITDA multiple		2.8x - 7.5x (7.4x)
Second lien			149			Market Comparable		Market Yield		14.8%
Second lien			—			Enterprise Market Value		EBITDA multiple		6.0x
Equity			100,489			Enterprise Market Value		EBITDA multiple		3.4x - 17.7x (12.1x)
Equity			144			Enterprise Market Value		DLOM(2)		27.9%
Total Level 3 investments		$	1,006,948
Long-Term Credit Facility and 2023 Notes		$	85,619			Market Comparable		Market Yield		2.3%

(1)The weighted averages disclosed in the table above were weighted by their relative fair value.

(2)DLOM is defined as discount for lack of marketability.

Summary of Investments, Cash and Cash Equivalents, Credit Facility, or Prior Credit Facility, Notes and Asset Backed Debt

Our investments, cash and cash equivalents, Credit Facility, 2023 Notes, 2026 Notes, 2031 Asset-Backed Debt, and 2036 Asset-Backed Debt were categorized as follows in the fair value hierarchy for ASC 820 purposes ($ in thousands):

		Fair Value at June 30, 2024
Description		Fair Value				Level 1				Level 2				Level 3				Measured at Net Asset Value (1)
First lien		$	1,449,206			$	—			$	—			$	1,449,206			$	—
Second lien			150				—				—				150				—
Subordinate debt			1,003				—				—				1,003				—
Equity			208,585				—				—				139,742				68,843
Total investments			1,658,944				—				—				1,590,101				68,843
Cash and cash equivalents			84,590				84,590				—				—				—
Total investments and cash and cash equivalents		$	1,743,534			$	84,590			$	—			$	1,590,101			$	68,843
Credit Facility payable		$	218,862			$	—			$	—			$	218,862			$	—
2026 Notes payable(2)			183,637				—				183,637				—				—
2031 Asset-Backed Debt(2)			209,931				—				—				209,931				—
2036 Asset-Backed Debt(2)			283,951				—				—				283,951				—
Total debt		$	896,381			$	—			$	183,637			$	712,744			$	—

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

(2)We elected not to apply the fair value option allowed by ASC 825-10 to the 2026 Notes, 2031 Asset-Backed Debt, and 2036 Asset-Backed Debt and thus the balance reported in the Consolidated Statement of Assets and Liabilities represents the carrying value, which approximates the fair value.

		Fair Value at September 30, 2023
Description		Fair Value				Level 1				Level 2				Level 3				Measured at Net Asset Value (1)
First lien		$	906,166			$	—			$	—			$	906,166			$	—
Second lien			149				—				—				149				—
Equity			160,859				—				—				100,633				60,226
Total investments			1,067,174				—				—				1,006,948				60,226
Cash and cash equivalents			100,555				100,555				—				—				—
Total investments and cash and cash equivalents		$	1,167,729			$	100,555			$	—			$	1,006,948			$	60,226
Credit Facility payable		$	9,400			$	—			$	—			$	9,400			$	—
2023 Notes payable			76,219				—				—				76,219				—
2026 Notes payable(2)			183,054				—				183,054				—				—
2031 Asset-Backed Debt(2)			226,759				—				—				226,759				—
Total debt		$	495,432			$	—			$	183,054			$	312,378			$	—

(1)In accordance with ASC Subtopic 820-10, Fair Value Measurements and Disclosures, or ASC 820-10, our equity investment in PSSL and PTSF is measured using the net asset value per share (or its equivalent) as a practical expedient for fair value, and thus has not been classified in the fair value hierarchy.

(2)We elected not to apply the fair value option allowed by ASC 825-10 to the 2026 Notes and the 2031 Asset-Backed Debt and thus the balance reported in the Consolidated Statement of Assets and Liabilities represents the carrying value, which approximates the fair value.

Reconciliation of Investments Measured at Fair Value Using Significant Unobservable Inputs Level 3

The tables below show a reconciliation of the beginning and ending balances for fair valued investments measured using significant unobservable inputs (Level 3)

($ in thousands):

		Nine Months Ended June 30, 2024
Description		First Lien				Second lien, subordinated debt and equity investments				Totals
Beginning balance		$	906,166			$	100,782			$	1,006,948
Net realized gain (loss)			(5,273	)			5,841				568
Net change in unrealized appreciation (depreciation)			4,009				9,150				13,159
Purchases, PIK interest, net discount accretion and non-cash exchanges			888,171				70,237				958,408
Sales, repayments and non-cash exchanges			(343,867	)			(45,115	)			(388,982	)
Transfers in and/or out of Level 3			—				—				—
Ending balance		$	1,449,206			$	140,895			$	1,590,101
Net change in unrealized appreciation (depreciation) reported within the net change in unrealized appreciaiton (depreciation) on investments in our consolidated statements of operations attributable to our Level 3 assets still held at the reporting date.		$	(2,997	)		$	11,500			$	8,503

		Nine Months Ended June 30, 2023
Description		First Lien				Second lien, subordinated debt and equity investments				Totals
Beginning balance		$	1,009,642			$	95,285			$	1,104,927
Net realized gain (loss)			(16,268	)			2,203				(14,065	)
Net change in unrealized appreciation (depreciation)			1,245				(12,296	)			(11,051	)
Purchases, PIK interest, net discount accretion and non-cash exchanges			208,709				17,977				226,686
Sales, repayments and non-cash exchanges			(253,084	)			(4,991	)			(258,075	)
Transfers in and/or out of Level 3			—				—				—
Ending balance		$	950,244			$	98,178			$	1,048,422
Net change in unrealized depreciation reported within the net change in unrealized depreciation on investments in our consolidated statements of operations attributable to our Level 3 assets still held at the reporting date.		$	(13,491	)		$	(9,234	)		$	(22,725	)

Reconciliation of Liabilities Measured at Fair Value Using Significant Unobservable Inputs Level 3

The table below shows a reconciliation of the beginning and ending balances for liabilities recognized at fair value and measured using significant unobservable inputs (Level 3)($ in thousands):

		Nine months ended June 30,
Long-Term Credit Facility and 2023 Notes		2024				2023
Beginning balance (cost – $85,619 and $169,654, respectively)		$	85,619			$	167,563
Net change in unrealized (depreciation) appreciation included in earnings			7				1,607
Borrowings			381,455				65,000
Repayments			(248,219	)			(169,709	)
Net realized (gain) loss			—				(544	)
Transfers in and/or out of Level 3			—				—
Ending balance (cost – $218,855 and $64,000, respectively)		$	218,862			$	63,917

Net Change In Fair Value On Foreign Currency Translation On Outstanding Borrowings Table [Text Block]

As of June 30, 2024, we had outstanding non-U.S. dollar borrowings on our Credit Facility. Net change in fair value from currency translation on outstanding borrowings is listed below ($ in thousands):

Foreign Currency		Amount Borrowed				Borrowing Cost				Current Value				Reset Date		Change in Fair Value
Canadian Dollar		$	2,000			$	1,455				1,462			7/1/2024			7

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