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

Fair Value of Investments (Tables)

v3.25.1
Fair Value of Investments (Tables)
12 Months Ended
Dec. 31, 2024
Fair Value of Investments [Abstract]  
Schedule of Company’s Assets Measured at Fair Value

The following tables presents information about the Company’s assets measured at fair value as of December 31, 2024 and 2023:

 

    As of December 31, 2024  
    Level 1     Level 2     Level 3     Total  
Portfolio Investments                        
First Lien Loans   $
-
    $
-
    $ 9,850,963     $ 9,850,963  
Second Lien Loans    
-
     
-
      7,987,797       7,987,797  
Equity    
-
     
-
      1,379,019       1,379,019  
Total Portfolio Investments    
-
     
-
      19,217,779       19,217,779  
Total Investments   $
   -
    $
   -
    $ 19,217,779     $ 19,217,779  

 

    As of December 31, 2023  
    Level 1     Level 2     Level 3     Total  
Portfolio Investments                        
First Lien Loans   $
     -
    $
   -
    $ 12,301,440     $ 12,301,440  
Second Lien Loans    
-
     
-
      11,652,480       11,652,480  
Equity    
-
     
-
      5,781,033       5,781,033  
Total Portfolio Investments    
-
     
-
      29,734,953       29,734,953  
Total Investments   $
-
    $
-
    $ 29,734,953     $ 29,734,953  
Schedule of Changes in Level 3 Assets Measured at Fair Value

Changes in Level 3 assets measured at fair value for the year ended December 31, 2024 are as follows:

 

   

First Lien

Loans

    Second
Lien Loans
    Unsecured
Loans
    Equity     Total  
Fair value at beginning of year   $ 12,301,440     $ 11,652,480     $
        -
    $ 5,781,033     $ 29,734,953  
Purchases of investments     80,000      
-
     
-
     
-
      80,000  
Sales or repayment of investments     (192,932 )    
-
     
-
     
-
      (192,932 )
Payment-in-kind interest    
-
      318,417      
-
     
-
      318,417  
Change in unrealized loss on investments     (1,014,333 )     (3,983,100 )    
-
      (175,491 )     (5,172,924 )
Realized loss on investments     (1,323,212 )    
-
     
-
      (4,226,523 )     (5,549,735 )
Fair value at end of year   $ 9,850,963     $ 7,987,797     $
-
    $ 1,379,019     $ 19,217,779  
Change in unrealized loss on  Level 3 investments still held as of  December 31, 2024   $ (2,357,078 )   $ (3,983,100 )   $
-
    $ (4,402,014 )   $ (10,742,192 )

 

Changes in Level 3 assets measured at fair value for the year ended December 31, 2023 are as follows:

 

   

First Lien

Loans

    Second Lien Loans     Unsecured
Loans
    Equity     Total  
Fair value at beginning of year   $ 13,144,967     $ 10,976,647     $
        -
    $ 6,442,474     $ 30,564,088  
Sales or repayment of investments    
-
     
-
     
-
     
-
     
-
 
Payment-in-kind interest    
-
      166,339      
-
     
-
      166,339  
Realized loss on investments    
-
     
-
     
-
      (1,200 )     (1,200 )
Change in unrealized gain (loss) on investments     (843,527 )     509,494      
-
      (660,241 )     (994,274 )
Transfers in/out    
-
     
-
     
-
     
-
     
-
 
Fair value at end of year   $ 12,301,440     $ 11,652,480     $
-
    $ 5,781,033     $ 29,734,953  
Change in unrealized gain (loss) on Level 3 investments still held as of December 31, 2023   $ (843,527 )   $ 509,494     $
-
    $ (660,241 )   $ (994,274 )
Schedule of Quantitative Information Regarding Level 3 Fair Value Measurements

The following table provides quantitative information regarding Level 3 fair value measurements as of December 31, 2024:

 

 

Description

  Fair Value     Valuation Technique (1)  

Unobservable

Inputs

  Range (Average (2))
First Lien Loans   $ 9,770,963     Enterprise Value Coverage   EV / STORE LEVEL EBITDAR   4.75x-5.25x(5.00x)
                Location Value   $1,300,000-$1,500,000 ($1,400,000)
      80,000     Appraisal Value Coverage    Cost Approach   $1,323,000-$1,617,000
($1,470,000)
                Sales Comparison Approach   $1,395,000-$1,705,000 ($1,550,000)
Total     9,850,963              
                     
Second Lien Loans     4,874,360     Enterprise Value Coverage   EV / LTM Revenue   0.37x-0.42x (0.40)
                EV / PF Revenue   1.05x-1.15x (1.10x)
      3,113,437     Net Orderly Liquidation Value   Total Asset Value Recovery Rate   54%-86% (70%)
Total     7,987,797              
                     
Unsecured Loans    
-
    Enterprise Value Coverage   EV / LTM Revenue   0.37x-0.42x (0.40x)
Total    
-
             
                     
Equity    
-
    Enterprise Value Coverage   EV / LTM Revenue   0.37x-0.42x (0.40x)
                EV / PF Revenue   1.05x-1.15x (1.10x)
                EV / Store level EBITDAR
Location Value
  4.75x-5.25x (5.00x)
$1,300,000-$1,500,000 ($1,400,000)
     
-
    Net Orderly Liquidation Value   Total Asset Value Recovery Rate   54%-86% (70%)
                     
      1,379,019     Appraisal Value Coverage
  Cost Approach
  $1,323,000-$1,617,000 ($1,470,000)
                Sales Comparison Approach   $1,395,000-$1,705,000 ($1,550,000)
Total     1,379,019              
Total Level 3 Investments   $ 19,217,779              

  

(1) There were no changes in the valuation technique for the Company’s investments from the prior quarter.

 

(2) The average represents the arithmetic average of the unobservable inputs and is not weighted by the relative fair value.

The following table provides quantitative information regarding Level 3 fair value measurements as of December 31, 2023:

 

 

Description

  Fair Value     Valuation Technique (1)  

Unobservable

Inputs

  Range (Average (2))
First Lien Loans   $ 12,128,041     Enterprise Value Coverage   EV / Store level EBITDAR   5.25x-5.75x (5.50x)
                Location Value   $1,425,000-$1,625,000 (1,525,000)
Total     12,128,041              
                     
Second Lien Loans     11,652,480      Enterprise Value Coverage    EV / Run Rate Revenue    0.37x-0.42x (0.39x)
                EV / PF EBITDA   5.50x-6.50x (6.00x)
Total     11,652,480              
                     
Unsecured Loans    
-
    Enterprise Value Coverage   EV / Run Rate Revenue   0.37x-0.42x (0.39x)
Total    
-
             
                     
Equity     4,237,192     Enterprise Value Coverage   EV / Run Rate Revenue   0.37x-0.42x (0.39x)
                EV / PF EBITDA   5.50x-6.50x (6.00x)
                EV / Store level EBITDAR   5.25x-5.75x (5.50x)
                Location Value   $1,425,000-$1,625,000 ($1,525,000)
                Cost Approach
  $1,413,000-$1,727,000 (1,570,000)
      1,543,841     Appraisal Value Coverage
  Sales Comparison Approach   $1,440,000-$1,760,000 ($1,600,000)
Total     5,781,033              
Total Level 3 Investments   $ 29,561,554              

 

(1) There were no changes in the valuation technique for the Company’s investments from the prior quarter.

 

(2) The average represents the arithmetic average of the unobservable inputs and is not weighted by the relative fair value.