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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________________________

FORM 10-Q

_______________________________________________________________________


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 000-56162

__________________________________________________________________________________________________________________________________

CNL STRATEGIC CAPITAL, LLC

(Exact name of registrant as specified in its charter)

__________________________________________________________________________________________________________________________________


Delaware						32-0503849
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


CNL Center at City Commons
450 South Orange Avenue
Orlando,	Florida	32801
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (407) 650-1000

________________________________________________________________________________________________

Securities registered pursuant to Section 12(b) of the Exchange Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
N/A	N/A	N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☒

Smaller reporting company

☒

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of November 5, 2025, the Company had 3,870,943 Class FA shares, 8,945,753 Class A shares, 2,266,133 Class T shares, 3,072,090 Class D shares, 16,379,515 Class I shares and 1,699,226 Class S shares outstanding.

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INDEX


		PAGE
PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited):	2

	Condensed Consolidated Statements of Assets and Liabilities	2

	Condensed Consolidated Statements of Operations	3

	Condensed Consolidated Statements of Changes in Net Assets	5

	Condensed Consolidated Statements of Cash Flows	7

	Condensed Consolidated Schedules of Investments	8

	Notes to Condensed Consolidated Financial Statements	13

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	37

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	59

Item 4.	Controls and Procedures	60

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	61

Item 1A.	Risk Factors	61

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	61

Item 3.	Defaults Upon Senior Securities	61

Item 4.	Mine Safety Disclosures	61

Item 5.	Other Information	61

Item 6.	Exhibits	62

Exhibit Index		62

Signatures		63

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

CNL STRATEGIC CAPITAL, LLC

CONDENSED CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

(in thousands, except per share data)


	September 30, 2025 (Unaudited)		December 31, 2024
Assets
Investments at fair value:
Portfolio company investments (amortized cost of $1,012,284 and $892,940, respectively)	$	1,352,090	$	1,140,859
Cash and cash equivalents	79,403		146,319

Receivable for shares sold	—		—


Prepaid expenses and other assets	227		472
Total assets	1,431,720		1,287,650
Liabilities

Due to related parties, net (Note 5)	23,869		26,386
Payable for shares repurchased	16,450		19,169
Deferred tax liabilities, net	18,354		9,844


Accounts payable and other accrued expenses	1,960		1,043


Total liabilities	60,633		56,442
Commitments and contingencies (Note 11)
Members’ Equity (Net Assets)
Preferred shares, $0.001 par value, 50,000 shares authorized and unissued	—		—
Class FA Common shares, $0.001 par value, 7,400 shares authorized; 4,844 shares issued; 3,871 and 4,017 shares outstanding, respectively	4		4
Class A Common shares, $0.001 par value, 94,660 shares authorized; 9,354 and 8,549 shares issued, respectively; 8,897 and 8,238 shares outstanding, respectively	9		8
Class T Common shares, $0.001 par value, 558,620 shares authorized; 4,010 and 3,582 shares issued, respectively; 2,244 and 2,511 shares outstanding, respectively	2		3
Class D Common shares, $0.001 par value, 94,660 shares authorized; 3,382 and 3,275 shares issued, respectively; 3,054 and 3,072 shares outstanding, respectively	3		3
Class I Common shares, $0.001 par value, 94,660 shares authorized; 18,455 and 15,936 shares issued, respectively; 15,924 and 14,154 shares outstanding, respectively	16		14
Class S Common shares, $0.001 par value, 100,000 shares authorized; 1,770 shares issued; 1,699 and 1,712 shares outstanding, respectively	2		2
Capital in excess of par value	1,103,855		1,031,526
Distributable earnings	267,196		199,648
Total Members’ Equity	$	1,371,087	$	1,231,208

Net asset value per share:
Class FA	$	42.05	$	39.55
Class A	$	37.51	$	35.68
Class T	$	37.46	$	35.72
Class D	$	37.24	$	35.42
Class I	$	37.96	$	36.12
Class S	$	42.55	$	40.09

See notes to condensed consolidated financial statements.

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CNL STRATEGIC CAPITAL, LLC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(in thousands, except per share data)


	Quarter Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Investment income
From portfolio company investments:
Interest income	$	11,014	$	10,333	$	31,785	$	30,221
Payment-in-kind (“PIK”) interest income	549		—		913		—
Dividend income	11,880		6,634		20,820		15,675
PIK dividend income	1,700		1,490		4,888		1,490
From U.S. Treasury bills and cash accounts
Interest and dividend income	337		1,221		2,197		4,367
Total investment income	25,480		19,678		60,603		51,753
Operating expenses
Total return incentive fees	8,423		5,174		21,890		14,932
Base management fees	6,420		4,802		17,490		13,028
Offering expenses	494		338		1,644		879
Professional services	873		851		2,361		2,435
Pursuit costs	220		(159)		911		843
Distribution and shareholder servicing fees	495		334		1,483		971
Custodian and accounting fees	143		127		439		394
Insurance expense	56		56		166		159
Director fees and expenses	49		52		152		159
General and administrative expenses	26		44		209		176
Interest expense	174		60		330		149

Total operating expenses	17,373		11,679		47,075		34,125
Expense support	2,875		353		(1,017)		—

Net operating expenses	20,248		12,032		46,058		34,125
Net investment income before taxes	5,232		7,646		14,545		17,628
Income tax expense	(28)		(15)		(75)		(10)
Net investment income	5,204		7,631		14,470		17,618
Realized and unrealized gain (loss) on investments and foreign currency
Net realized gain on investments:
Portfolio company investments	1,432		—		1,432		—
Total net realized gain on investments	1,432		—		1,432		—
Net change in unrealized appreciation on investments, including unrealized foreign currency gain (loss):
Portfolio company investments	31,670		16,845		91,888		53,314

Provision for deferred taxes on investments	(3,497)		(1,300)		(8,510)		(2,567)
Total net change in unrealized appreciation on investments, including unrealized foreign currency gain (loss)	28,173		15,545		83,378		50,747
Net gain on investments	29,605		15,545		84,810		50,747
Net increase in net assets resulting from operations	$	34,809	$	23,176	$	99,280	$	68,365

See notes to condensed consolidated financial statements.

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CNL STRATEGIC CAPITAL, LLC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(in thousands, except per share data)


	Quarter Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Net increase in net assets resulting from operations per share
Class FA	$	1.27	$	0.88	$	3.44	$	2.68
Class A	$	0.96	$	0.74	$	2.77	$	2.15
Class T	$	0.92	$	0.64	$	2.49	$	1.94
Class D	$	0.94	$	0.66	$	2.66	$	2.06
Class I	$	0.92	$	0.69	$	2.78	$	2.14
Class S	$	1.19	$	0.87	$	3.40	$	2.65

Weighted average shares
Class FA	3,901		4,069		3,946		4,118
Class A	8,877		6,897		8,548		6,130
Class T	2,198		2,562		2,385		2,590
Class D	3,045		2,999		3,054		2,822
Class I	15,637		13,544		15,008		12,974
Class S	1,702		1,728		1,707		1,741

See notes to condensed consolidated financial statements.

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CNL STRATEGIC CAPITAL, LLC

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

(in thousands)


	Common Shares			Capital in Excess of Par Value		Distributable Earnings		Total Net Assets
	Number of Shares	Par Value
Balance as of June 30, 2025	34,959	$	36	$	1,076,656	$	243,200	$	1,319,892
Net investment income	—	—		—		5,204		5,204
Net realized gain on investments	—	—		—		1,432		1,432
Net change in unrealized appreciation on investments	—	—		—		28,173		28,173
Distributions to shareholders	—	—		—		(10,813)		(10,813)
Issuance of common shares through the Public Offerings	1,013	1		38,098		—		38,099
Issuance of common shares through distribution reinvestment plan	147	—		5,519		—		5,519
Repurchase of common shares pursuant to share repurchase program	(430)	(1)		(16,418)		—		(16,419)
Balance as of September 30, 2025	35,689	$	36	$	1,103,855	$	267,196	$	1,371,087


	Common Shares			Capital in Excess of Par Value		Distributable Earnings		Total Net Assets
	Number of Shares	Par Value
Balance as of December 31, 2024	33,704	$	34	$	1,031,526	$	199,648	$	1,231,208
Net investment income	—	—		—		14,470		14,470
Net realized gain on investments	—	—		—		1,432		1,432
Net change in unrealized appreciation on investments	—	—		—		83,378		83,378
Distributions to shareholders	—	—		—		(31,732)		(31,732)
Issuance of common shares through the Public Offerings	2,784	3		102,475		—		102,478
Issuance of common shares through distribution reinvestment plan	437	—		16,029		—		16,029
Repurchase of common shares pursuant to share repurchase program	(1,236)	(1)		(46,175)		—		(46,176)
Balance as of September 30, 2025	35,689	$	36	$	1,103,855	$	267,196	$	1,371,087

See notes to condensed consolidated financial statements.

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CNL STRATEGIC CAPITAL, LLC

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2024

(in thousands)


	Common Shares			Capital in Excess of Par Value		Distributable Earnings		Total Net Assets
	Number of Shares	Par Value
Balance as of June 30, 2024	31,093	$	31	$	941,319	$	154,959	$	1,096,309
Net investment income	—	—		—		7,631		7,631

Net change in unrealized appreciation on investments	—	—		—		15,545		15,545
Distributions to shareholders	—	—		—		(9,676)		(9,676)
Issuance of common shares through the Public Offerings	1,770	2		61,183		—		61,185
Issuance of common shares through distribution reinvestment plan	136	—		4,693		—		4,693
Repurchase of common shares pursuant to share repurchase program	(335)	—		(11,767)		—		(11,767)
Balance as of September 30, 2024	32,664	$	33	$	995,428	$	168,459	$	1,163,920


	Common Shares			Capital in Excess of Par Value		Distributable Earnings		Total Net Assets
	Number of Shares	Par Value
Balance as of December 31, 2023	28,435	$	29	$	851,529	$	127,791	$	979,349
Net investment income	—	—		—		17,618		17,618

Net change in unrealized appreciation on investments	—	—		—		50,747		50,747
Distributions to shareholders	—	—		—		(27,697)		(27,697)
Issuance of common shares through the Public Offerings	4,948	5		169,128		—		169,133
Issuance of common shares through distribution reinvestment plan	383	—		13,093		—		13,093
Repurchase of common shares pursuant to share repurchase program	(1,102)	(1)		(38,322)		—		(38,323)
Balance as of September 30, 2024	32,664	$	33	$	995,428	$	168,459	$	1,163,920

See notes to condensed consolidated financial statements.

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CNL STRATEGIC CAPITAL, LLC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(in thousands)


	Nine Months Ended September 30,
	2025		2024
Operating Activities:
Net increase in net assets resulting from operations	$	99,280	$	68,365
Adjustments to reconcile net increase in net assets resulting from operations to net cash used in operating activities:
Purchases of portfolio company investments	(166,572)		(122,719)
Proceeds from portfolio company investments	52,120		—
Proceeds from return of capital on portfolio company investments	2,342		2,445


Net realized gain on portfolio company investments	(1,432)		—
Net change in unrealized appreciation on investments and foreign currency transactions, excluding deferred taxes	(91,888)		(53,314)

PIK interest	(913)		—
PIK dividends	(4,888)		(1,490)


(Decrease) increase in due to related parties	(2,517)		984
Increase (decrease) in accounts payable and other accrued expenses	917		(265)
Increase in deferred tax liabilities, net	8,510		2,567
Increase (decrease) in prepaid expenses and other assets	272		(64)
Other operating activities	107		102
Net cash used in operating activities	(104,662)		(103,389)
Financing Activities:
Proceeds from issuance of common shares	102,478		170,544
Payment on repurchases of common shares	(48,895)		(34,780)
Proceeds from line of credit	30,000		—
Repayment of line of credit	(30,000)		—
Distributions paid, net of distributions reinvested	(15,703)		(14,604)
Deferred financing costs	(134)		(163)
Net cash provided by financing activities	37,746		120,997
Net (decrease) increase in cash and cash equivalents	(66,916)		17,608
Cash and cash equivalents, beginning of period	146,319		134,453
Cash and cash equivalents, end of period	$	79,403	$	152,061
Supplemental disclosure of cash flow information and non-cash financing activities:
Distributions reinvested	$	16,029	$	13,093
Cash interest paid during the period	$	169	$	—
Amounts incurred but not paid (including amounts due to related parties):

Offering costs	$	212	$	121
Payable for shares repurchased	$	16,450	$	11,767

See notes to condensed consolidated financial statements.

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CNL STRATEGIC CAPITAL, LLC CONDENSED CONSOLIDATED SCHEDULE OF INVESTMENTS (UNAUDITED) AS OF SEPTEMBER 30, 2025
(in thousands except share data)
Company (1)(2)(3)	Industry	Interest Rate	Maturity Date	Principal Amount / No. Shares	Amortized Cost		Fair Value
Senior Secured Note – First Lien – 4.8%
Clarion Safety Systems, LLC	Visual Safety Solutions	15.0%	12/9/2028	22,500	$	22,500	$	22,500
Lawn Doctor, Inc.	Commercial and Professional Services	(4)	8/6/2029	29,490	29,490		29,490
Madison Retirement Holdings TopCo, LLC	Retirement Plan Services	15.0%	7/18/2031	15,000	15,000		15,000
Total Senior Secured Notes – First Lien					66,990		66,990
Senior Secured Note –12.5%
ATA Holding Company, LLC(5)	Real Estate Services	15.0%	4/1/2027	37,000	$	37,000	$	37,000
Auriemma Consulting Group, Inc.(5)	Information Services and Advisory Solutions	8.0%	12/31/2028	2,000	2,000		2,000
Healthcare Safety Holdings, LLC(5)	Healthcare Supplies	15.0%	7/16/2027	24,400	24,400		24,400
IFPG TopCo, LLC(10)	Franchise Consulting Services	15.0%	6/23/2032	23,000	23,000		23,000
Polyform Products, Co.(5)	Hobby Goods and Supplies	16.0%	2/7/2028	15,700	15,700		15,700
Sill Holdings, LLC(5)	Insurance Services	14.0%	10/20/2030	15,851	15,851		15,851
Tacmed Holdings, LLC(5)	Healthcare Supplies	16.0%	3/24/2030	29,000	29,000		29,000
Vektek Holdings, LLC(5)	Engineered Products	(4)	5/6/2029	24,438	24,438		24,438
Total Senior Secured Note					171,389		171,389
Senior Secured Notes – Second Lien – 4.6%
Auriemma U.S. Roundtables	Information Services and Advisory Solutions	16.0%	7/1/2028	12,114	$	12,114	$	12,114
Blue Ridge ESOP Associates	Retirement Plan Services	15.0%	12/28/2029	2,641	2,641		2,641
Lawn Doctor, Inc.	Commercial and Professional Services	16.0%	2/7/2030	15,000	15,000		15,000
Milton Industries Inc.	Engineered Products	15.0%	12/19/2030	3,353	3,353		3,353
Resolution Economics, LLC	Legal Services	15.0%	12/30/2027	2,834	2,834		2,834
SDC Holdco LLC	Restaurant and Food	16.0%	1/24/2033	684	684		684
USA Water Intermediate Holdings, LLC	Commercial and Professional Services	16.0%	8/20/2031	1,376	1,376		1,376
Vektek Holdings, LLC	Engineered Products	15.0%	11/6/2029	24,400	24,400		24,400
Total Senior Secured Notes – Second Lien					62,402		62,402
Senior Secured PIK Notes - 1.4%
LOCI Topco Limited(6)(7)	Legal Services	12.0% PIK(9)	5/17/2039	9,415	$	9,415	$	9,506
LOCI Topco Limited(6)(8)	Legal Services	12.0% PIK(9)	5/17/2039	9,415	9,415		9,506
Total Senior Secured PIK Notes					18,830		19,012
Total Senior Secured Notes					$	319,611	$	319,793

See notes to condensed consolidated financial statements.

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CNL STRATEGIC CAPITAL, LLC CONDENSED CONSOLIDATED SCHEDULE OF INVESTMENTS (UNAUDITED) AS OF SEPTEMBER 30, 2025 (CONTINUED)
(in thousands except share data)
Company (1)(2)(3)	Industry	Interest Rate	Maturity Date	Principal Amount / No. Shares	Amortized Cost		Fair Value
Preferred Equity - 5.7%
LOCI Topco Limited(6)	Legal Services	8.5% PIK(9)		46,597,751	$	66,557	$	70,081
LOCI Topco Limited(6)	Legal Services	12.0% PIK(9)		5,905,775	8,255		8,335
Total Preferred Equity					74,812		78,416
Common Equity – 69.6%
ATA Holding Company, LLC(10)	Real Estate Services			37,985	$	37,125	$	36,205
Auriemma U.S. Roundtables(10)	Information Services and Advisory Solutions			33,094	33,476		69,225
Blue Ridge ESOP Associates	Retirement Plan Services			11,489	8,072		39,878
Clarion Safety Systems, LLC(10)	Visual Safety Solutions			68,891	70,316		103,870
Healthcare Safety Holdings, LLC(10)	Healthcare Supplies			17,320	17,320		43,736
IFPG TopCo, LLC10)	Franchise Consulting Services			90,500	90,500		90,500
LOCI Topco Limited(6)	Legal Services			104,624	134		4,544
Lawn Doctor, Inc.(10)	Commercial and Professional Services			7,746	27,610		97,710
Madison Retirement Holdings TopCo, LLC(10)	Retirement Plan Services			61,500	61,500		81,894
Milton Industries Inc.	Engineered Products			7,395	8,903		19,738
Polyform Products, Co.(10)	Hobby Goods and Supplies			10,820	15,599		10,810
Resolution Economics, LLC	Legal Services			7,666	7,645		24,360
SDC Holdco LLC	Restaurant and Food			6,816	6,816		6,816
Sill Holdings, LLC(10)	Insurance Services			82,754	90,549		145,758
Tacmed Holdings, LLC(10)	Healthcare Supplies			77,000	76,744		99,459
USA Water Intermediate Holdings, LLC	Commercial and Professional Services			86,245	8,624		12,619
Vektek Holdings, LLC(10)	Engineered Products			56,928	56,928		66,759
Total Common Equity					617,861		953,881
Total Equity					$	692,673	$	1,032,297
TOTAL INVESTMENTS – 98.6%					$	1,012,284	$	1,352,090
OTHER ASSETS IN EXCESS OF LIABILITIES – 1.4%							18,997
NET ASSETS – 100.0%							$	1,371,087

FOOTNOTES:

(1) Security may be an obligation of one or more entities affiliated with the named company.

(2) Percentages represent fair value as a percentage of net assets for each investment category.

(3) All investments are US based unless otherwise noted.

(4) As of September 30, 2025, the senior debt investments in Lawn Doctor and Vektek accrue interest at a per annum rate of SOFR + 4.60%. SOFR at September 30, 2025 was 4.31%.

(5) The Company has a first lien on this portfolio company’s assets, except in cases when the portfolio company has a revolving line of credit provided by a third party lender. In some instances the revolving lender has a first priority lien on all assets, whereas, in others, the revolving lender has a first priority lien on only accounts receivable and inventory, if applicable, and a second lien on all other assets.

(6) LBR is headquartered in the United Kingdom. LBR investment represents 7.4% of net assets based on fair value as of September 30, 2025.

See notes to condensed consolidated financial statements.

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(7) Represents Tranche A2 PIK Notes, which rank third after the Tranche A1 PIK Notes issued by LOCI Midco 1 Limited (subsidiary of LOCI TopCo Limited).

(8) Represents Tranche B2 PIK Notes, which rank fourth after the Tranche A1 PIK Notes issued by LOCI Midco I Limited (subsidiary of LOCI TopCo Limited).

(9) PIK interest and dividend income is computed at the contractual rate in each applicable agreement and is accrued and recorded as interest income and dividend income, respectively, and capitalized to the principal balance.

(10) As of September 30, 2025, the Company owned a controlling interest in this portfolio company.

See notes to condensed consolidated financial statements.

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CNL STRATEGIC CAPITAL, LLC CONDENSED CONSOLIDATED SCHEDULE OF INVESTMENTS AS OF DECEMBER 31, 2024
(in thousands except share data)
Company (1)(2)(3)	Industry	Interest Rate	Maturity Date	Principal Amount / No. Shares	Amortized Cost		Fair Value
Senior Secured Note – First Lien – 5.4%
Clarion Safety Systems, LLC	Visual Safety Solutions	15.0%	12/9/2028	22,500	$	22,500	$	22,500
Lawn Doctor, Inc	Commercial and Professional Services	(4)	8/6/2029	29,490	29,490		29,490
Madison Retirement Holdings TopCo, LLC	Retirement Plan Services	15.0%	7/18/2031	15,000	15,000		15,000
Total Senior Secured Note - First Lien					66,990		66,990
Senior Secured Note –12.1%
ATA Holding Company, LLC(5)	Real Estate Services	15.0%	4/1/2027	37,000	$	37,000	$	37,000
Auriemma Consulting Group, Inc.(5)	Information Services and Advisory Solutions	8.0%	12/31/2028	2,000	2,000		2,000
Healthcare Safety Holdings, LLC(5)	Healthcare Supplies	15.0%	7/16/2027	24,400	24,400		24,400
Polyform Products, Co.(5)	Hobby Goods and Supplies	16.0%	2/7/2026	15,700	15,700		15,700
Sill Holdings, LLC (5)	Business Services	14.0%	10/20/2030	15,851	15,851		15,851
Tacmed Holdings, LLC(5)	Healthcare Supplies	16.0%	3/24/2030	29,000	29,000		29,000
Vektek Holdings, LLC(5)	Engineered Products	(4)	5/6/2029	24,625	24,625		24,625
Total Senior Secured Note					148,576		148,576
Senior Secured Note – Second Lien – 6.2%
Auriemma U.S. Roundtables	Information Services and Advisory Solutions	16.0%	7/1/2028	12,114	$	12,114	$	12,114
Blue Ridge ESOP Associates	Retirement Plan Services	15.0%	12/28/2029	2,641	2,641		2,641
Douglas Machines Corp.	Sanitation Products	16.0%	10/7/2028	15,000	15,000		15,000
Lawn Doctor, Inc	Commercial and Professional Services	16.0%	2/7/2030	15,000	15,000		15,000
Milton Industries Inc	Engineered Products	15.0%	12/19/2030	3,353	3,353		3,353
Resolution Economics, LLC	Business Services	15.0%	12/30/2027	2,834	2,834		2,834
USA Water Intermediate Holdings, LLC	Commercial and Professional Services	16.0%	8/20/2031	1,376	1,376		1,376
Vektek Holdings, LLC	Engineered Products	15.0%	11/6/2029	24,400	24,400		24,400
Total Senior Secured Note - Second Lien					76,718		76,718
Total Senior Secured Notes					$	292,284	$	292,284

See notes to condensed consolidated financial statements.

Table of Contents


CNL STRATEGIC CAPITAL, LLC CONDENSED CONSOLIDATED SCHEDULE OF INVESTMENTS AS OF DECEMBER 31, 2024 (CONTINUED)
(in thousands except share data)
Company (1)(2)(3)	Industry	Interest Rate	Maturity Date	Principal Amount / No. Shares	Amortized Cost		Fair Value
Preferred Equity – 5.0%
LOCI Topco Limited (6)	Information Services and Advisory Solutions	8.5% PIK(7)		46,597,751	$	62,070	$	61,155
Total Preferred Equity					62,070		61,155
Common Equity – 64.0%
ATA Holding Company, LLC (8)	Real Estate Services			37,985	$	37,125	$	35,291
Auriemma U.S. Roundtables (8)	Information Services and Advisory Solutions			33,094	33,476		62,511
Blue Ridge ESOP Associates	Retirement Plan Services			11,489	10,200		36,896
Clarion Safety Systems, LLC (8)	Visual Safety Solutions			57,368	56,816		67,213
Douglas Machines Corp. (8)	Sanitation Products			35,500	35,500		39,057
Healthcare Safety Holdings, LLC (8)	Healthcare Supplies			17,320	17,320		47,726
LOCI Topco Limited (6)	Information Services and Advisory Solutions			73,215	93		1,618
Lawn Doctor, Inc (8)	Commercial and Professional Services			7,746	27,610		91,742
Madison Retirement Holdings TopCo, LLC(8)	Retirement Plan Services			57,500	57,500		60,463
Milton Industries, Inc	Engineered Products			6,647	6,647		18,849
Polyform Products, Co. (8)	Hobby Goods and Supplies			10,820	15,599		12,751
Resolution Economics, LLC	Business Services			7,666	7,855		20,400
Sill Holdings, LLC (8)	Business Services			82,754	90,549		119,736
Tacmed Holdings, LLC (8)	Healthcare Supplies			77,000	76,744		92,378
USA Water Intermediate Holdings, LLC	Commercial and Professional Services			86,245	8,624		10,370
Vektek Holdings, LLC (8)	Engineered Products			56,928	56,928		70,419
Total Common Equity					538,586		787,420
Total Equity					$	600,656	$	848,575
Total Investments – 92.7%					$	892,940	$	1,140,859
OTHER ASSETS IN EXCESS OF LIABILITIES–7.3%							90,349
NET ASSETS–100.0%							$	1,231,208

FOOTNOTES:

(1) Security may be an obligation of one or more entities affiliated with the named company.

(2) Percentages represent fair value as a percentage of net assets for each investment category.

(3) All investments are US based unless otherwise noted.

(4) As of December 31, 2024, the senior debt investments in Lawn Doctor and Vektek accrue interest at a per annum rate of SOFR + 4.60% and SOFR + 4.35%, respectively. SOFR at December 31, 2024 was 4.53%.

(6) LBR is headquartered in the United Kingdom. LBR investment represents 5.10% of net assets based on fair value as of December 31, 2024.

(7) PIK dividend income is computed at the contractual rate in each applicable agreement and is accrued and recorded as dividend income and capitalized to the principal balance.

(8) As of December 31, 2024, the Company owned a controlling interest in this portfolio company.

See notes to condensed consolidated financial statements.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

1. Principal Business and Organization

CNL Strategic Capital, LLC (the “Company”) is a limited liability company that primarily seeks to acquire and grow durable, middle-market U.S. businesses. The Company is externally managed by CNL Strategic Capital Management, LLC (the “Manager”) and sub-managed by Levine Leichtman Strategic Capital, LLC (the “Sub-Manager”). The Manager is responsible for the overall management of the Company’s activities and the Sub-Manager is responsible for the day-to-day management of the Company’s assets. The Manager and the Sub-Manager are each registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Advisors Act”). The Company conducts and intends to continue its operations so that the Company and each of its subsidiaries do not fall within, or are excluded from, the definition of an “investment company” under the Investment Company Act of 1940, as amended (the “Investment Company Act”).

The Company intends to target businesses that are highly cash flow generative, with annual revenues primarily between $15 million and $250 million and whose management teams seek an ownership stake in the company. The Company’s business strategy is to acquire controlling equity interests in combination with debt positions and in doing so, provide long-term capital appreciation and current income while protecting invested capital. The Company seeks to structure its investments with limited, if any, third-party senior leverage.

The Company intends for a significant majority of its total assets to be comprised of long-term controlling equity interests and debt positions in the businesses it acquires. In addition, and to a lesser extent, the Company may acquire other debt and minority equity positions. The Company intends to acquire, directly or through syndication, various types of debt including secured and senior unsecured debt, notes and other instruments. The Company may also acquire minority equity interests as a standalone investment or as a co-investment in combination with other funds and partnerships managed by the Sub-Manager or its affiliates. The Company expects that these positions will comprise a minority of its total assets.

The Company commenced its initial public offering of up to $1.1 billion of its limited liability company interests (“shares”) on March 7, 2018 (the “Initial Public Offering”), which included up to $100.0 million of shares being offered through its distribution reinvestment plan, pursuant to a registration statement on Form S-1, as amended (the “Initial Registration Statement”). On November 1, 2021, the Company commenced a follow-on public offering of up to $1.1 billion of shares (the “Follow-On Public Offering”), which included up to $100.0 million of shares being offered through its distribution reinvestment plan, pursuant to a registration statement on Form S-1 (the “Follow-On Registration Statement”). On November 1, 2024, the Company commenced a second follow-on public offering of up to $1.1 billion of shares (the “Second Follow-On Public Offering,” and together with the Initial Public Offering and the Follow-On Public Offering, the “Public Offerings”), which includes up to $100.0 million of shares being offered through its distribution reinvestment plan pursuant to a registration statement on Form S-1 (the “Second Follow-On Registration Statement”) filed with the Securities and Exchange Commission (the “SEC”), and terminated the Follow-On Public Offering.

Through the Second Follow-On Public Offering, the Company is offering, in any combination, four classes of shares: Class A shares, Class T shares, Class D shares and Class I shares (collectively, the “Non-founder shares”). There are differing selling fees and commissions and dealer manager fees for each share class. The Company also pays distribution and shareholder servicing fees, subject to certain limits, on the Class T and Class D shares sold in the Second Follow-On Public Offering (excluding sales pursuant to its distribution reinvestment plan). See Note 7. “Capital Transactions” and Note 13. “Subsequent Events” for additional information related to the Public Offerings.

2. Significant Accounting Policies

Basis of Presentation

The Company’s financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) as contained in the Financial Accounting Standards Board Accounting Standards Codification (“ASC”), which requires the use of estimates, assumptions and the exercise of subjective judgment as to future uncertainties. In the opinion of management, the condensed consolidated financial statements reflect all adjustments that are of a normal recurring nature and necessary for the fair presentation of financial results as of and for the periods presented.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Although the Company is organized and intends to conduct its business in a manner so that it is not required to register as an investment company under the Investment Company Act, its financial statements are prepared using the specialized accounting principles of ASC Topic 946, “Financial Services—Investment Companies” (“ASC Topic 946”) to utilize investment company accounting. The Company obtains funds through the issuance of equity interests to multiple unrelated investors, and provides such investors with investment management services. Further, the Company’s business strategy is to acquire interests in middle-market U.S. businesses to provide current income and long term capital appreciation, while protecting invested capital. Overall, the Company believes that the use of investment company accounting on a fair value basis is consistent with the management of its assets on a fair value basis, and makes the Company’s financial statements more useful to investors and other financial statement users in facilitating the evaluation of an investment in the Company as compared to other investment products in the marketplace.

Principles of Consolidation

Under ASC Topic 946 the Company is precluded from consolidating any entity other than an investment company or an operating company which provides substantially all of its services to benefit the Company. In accordance therewith, the Company has consolidated the results of its wholly owned subsidiaries that are investment companies in its condensed consolidated financial statements. However, the Company has not consolidated the results of its subsidiaries in which the Company holds debt and equity investments. All intercompany account balances and transactions have been eliminated in consolidation.

Cash and Cash Equivalents

Cash and cash equivalents consist of demand deposits and money market funds at commercial banks. Demand deposits are carried at cost plus accrued interest, which approximates fair value. The Company deposits its cash with highly-rated banking corporations and, at times, cash deposits may exceed the insured limits under applicable law.

Use of Estimates

Management makes estimates and assumptions related to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare the financial statements in conformity with GAAP. The uncertainty of future events may materially impact the accuracy of the estimates and assumptions used in the financial statements and related footnotes and actual results could differ from those estimates.

Valuation of Investments

ASC Topic 820, “Fair Value Measurements and Disclosures” (“ASC Topic 820”) clarifies that fair value is the price in an orderly transaction between market participants to sell an asset or transfer a liability in the market in which the reporting entity would transact for the asset or liability, that is, the principal or most advantageous market for the asset or liability. The transaction to sell the asset or transfer the liability is a hypothetical transaction at the measurement date, considered from the perspective of a market participant that holds the asset or owes the liability. ASC Topic 820 provides a consistent definition of fair value which focuses on exit price and prioritizes, within a measurement of fair value, the use of market-based inputs over entity-specific inputs.

In addition, ASC Topic 820 provides a framework for measuring fair value and establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels of valuation hierarchy established by ASC Topic 820 are defined as follows:

Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets. An active market is defined as a market in which transactions for the asset or liability occur with sufficient pricing information on an ongoing basis. Publicly listed equity and debt securities and listed derivatives that are traded on major securities exchanges and publicly traded equity options are generally valued using Level 1 inputs. If a price for an asset cannot be determined based upon this established process, it shall then be valued as a Level 2 or Level 3 asset.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include the following: (i) quoted prices for similar assets in active markets; (ii) quoted prices for identical or similar assets in markets that are not active; (iii) inputs that are derived principally from or corroborated by observable market data by correlation or other means; and (iv) inputs other than quoted prices that are observable for the assets. Fixed income and derivative assets, where there is an observable secondary trading market and through which pricing inputs are available through pricing services or broker quotes, are generally valued using Level 2 inputs. If a price for an asset cannot be determined based upon this established process, it shall then be valued as a Level 3 asset.

Level 3 – Unobservable inputs for the asset or liability being valued. Unobservable inputs will be used to measure fair value to the extent that observable inputs are not available and such inputs will be based on the best information available in the circumstances, which under certain circumstances might include the Manager’s or the Sub-Manager’s own data. Level 3 inputs may include, but are not limited to, capitalization and discount rates and earnings before interest, taxes, depreciation and amortization (“EBITDA”) multiples. The information may also include pricing information or broker quotes which include a disclaimer that the broker would not be held to such a price in an actual transaction. Certain assets may be valued based upon estimated value of underlying collateral and include adjustments deemed necessary for estimates of costs to obtain control and liquidate available collateral. The non-binding nature of consensus pricing and/or quotes accompanied by disclaimer would result in classification as Level 3 information, assuming no additional corroborating evidence. Debt and equity investments in private companies or assets valued using the market or income approach are generally valued using Level 3 inputs.

In all cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls will be determined based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to each asset.

The Company’s board of directors is responsible for determining in good faith the fair value of the Company’s Level 3 investments in accordance with the Company’s valuation policy and procedures approved by the board of directors, based on, among other factors, the input of the Manager, the Sub-Manager, its audit committee, and the independent third-party valuation firm. The determination of the fair value of the Company’s Level 3 assets requires judgment, which include assets for which market prices are not available. For most of the Company’s assets, market prices will not be available. Due to the inherent uncertainty of determining the fair value of assets that do not have a readily available market value, the fair value of the assets may differ significantly from the values that would have been used had a readily available market value existed for such assets, and the differences could be material. Because the calculation of the Company’s net asset value is based, in part, on the fair value of its assets, the Company’s calculation of net asset value is subjective and could be adversely affected if the determinations regarding the fair value of its assets were materially higher than the values that the Company ultimately realizes upon the disposal of such assets. Furthermore, through the valuation process, the Company’s board of directors may determine that the fair value of the Company’s Level 3 assets differs materially from the values that were provided by the independent valuation firm.

The Company may also look to private merger and acquisition statistics, public trading multiples adjusted for illiquidity and other factors, valuations implied by third-party investments in the businesses or industry practices in determining fair value. The Company may also consider the size and scope of a business and its specific strengths and weaknesses, as well as any other factors it deems relevant in assessing the value.

Net Realized Gains or Losses and Net Change in Unrealized Appreciation or Depreciation on Investments

The Company will measure realized gains or losses as the difference between the net proceeds from the sale, repayment, or disposal of an asset and the amortized cost basis of the asset, without regard to unrealized appreciation or depreciation previously recognized. Net change in unrealized appreciation or depreciation on investments will reflect the change in asset values during the reporting period, including any reversal of previously recorded unrealized appreciation or depreciation, when gains or losses are realized.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Foreign Securities

The accounting records of the Company are maintained in U.S. dollars. Investment securities denominated in foreign currencies are translated into U.S. dollars based on the rate of exchange of such currencies on the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollars based on the rate of exchange of such currencies on the respective dates of the transactions. The Company does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with “Net change in unrealized appreciation on investments, including unrealized foreign currency gain (loss)” in the Company's condensed consolidated statements of operations.

Income Recognition

Interest Income – Interest income from loans and debt securities is recorded on an accrual basis to the extent that the Company expects to collect such amounts. The Company does not accrue as a receivable interest on loans and debt securities for accounting purposes if it has reason to doubt its ability to collect such interest.

The Company places loans on non-accrual status when principal and interest are past due 90 days or more or when there is a reasonable doubt that the Company will collect principal or interest. Accrued interest is generally reversed when a loan is placed on non-accrual. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment. Non-accrual loans are generally restored to accrual status when past due principal and interest amounts are paid and, in management’s judgment, are likely to remain current. Since inception, the Company has not experienced any past due payments on any of its loan investments.

PIK Interest Income - PIK interest income is computed at the contractual rate specified in each applicable agreement and is accrued and recorded as interest income and capitalized to the principal balance of the respective PIK Note. Such income is accrued only to the extent that the Company believes that the PIK interest income is probable of being collected. PIK interest capitalized to the principal balance is generally collected upon maturity of the respective PIK Note.

Dividend Income – Dividend income is recorded on the record date for privately issued securities, but excludes any portion of distributions that are treated as a return of capital. Each distribution received from an equity investment is evaluated to determine if the distribution should be recorded as dividend income or a return of capital. Generally, the Company will not record distributions from equity investments as dividend income unless there are sufficient current or accumulated earnings prior to the distribution. Distributions that are classified as a return of capital are recorded as a reduction in the cost basis of the investment.

PIK Dividend Income - PIK dividend income is computed at the contractual rate specified in each applicable agreement and is accrued and recorded as dividend income and capitalized to the principal balance of the preferred equity. Such income is accrued only to the extent that the Company believes that the PIK dividend income is probable of being collected. PIK dividends capitalized to the principal balance are generally collected upon redemption of the equity.

Paid in Capital

The Company records the proceeds from the sale of its common shares on a net basis to (i) capital shares at par value and (ii) paid in capital in excess of par value, excluding upfront selling commissions and dealer manager fees.

Share Repurchases

Under the Company’s share repurchase program (the “Share Repurchase Program”), shares are redeemed as of the repurchase date, which will generally be the last business day of the month of a calendar quarter. Shares redeemed are retired and not available for reissue. See Note 7. “Capital Transactions” for additional information.

Offering Expenses

Offering expenses, which consist of amounts incurred for items such as legal, accounting, regulatory and printing work incurred related to the Public Offerings, are capitalized on the Company’s condensed consolidated statements of assets and liabilities as deferred offering expenses and expensed to the Company’s condensed consolidated statements of operations over the lesser of the offering period or 12 months; however, the end of the deferral period will not exceed 12 months from the date the offering expense is incurred by the Manager and the Sub-Manager.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Distribution and Shareholder Servicing Fees

The Company pays distribution and shareholder servicing fees with respect to its Class T and Class D shares, as described further below in Note 5. “Related Party Transactions.” The Company records the distribution and shareholder servicing fees, which accrue daily, in the Company’s condensed consolidated statements of operations as they are incurred.

Deferred Financing Costs

Financing costs, including upfront fees, commitment fees and legal fees related to borrowings (as further described in Note 8. “Borrowings”) are deferred and amortized over the life of the related financing instrument using the effective yield method. The amortization of deferred financing costs is included in general and administrative expense in the Company’s condensed consolidated statements of operations.

Allocation of Profit and Loss

Class-specific expenses, including base management fees, total return incentive fees, offering expenses, expense support (reimbursement), distribution and shareholder servicing fees and certain transfer agent fees, are allocated to each share class of common shares in accordance with how such expenses are attributable to the particular share classes, as determined by the Company’s board of directors, the Company’s governing agreements and, in certain cases, expenses which are specifically identifiable to a share class.

The following table reflects class-specific expenses by share class during the quarter and nine months ended September 30, 2025 and 2024 (in thousands):


	Quarter Ended September 30, 2025
	Class FA Shares		Class A Shares		Class T Shares		Class D Shares		Class I Shares		Class S Shares
Base management fees	$	293	$	1,823	$	400	$	592	$	3,161	$	151
Total return incentive fees	557		2,310		535		770		4,010		241
Offering expenses	—		—		77		12		405		—
Expense support	73		675		107		216		1,655		149
Other class-specific expenses (1)	7		40		206		148		227		5


	Nine Months Ended September 30, 2025
	Class FA Shares		Class A Shares		Class T Shares		Class D Shares		Class I Shares		Class S Shares
Base management fees	$	834	$	4,892	$	1,234	$	1,660	$	8,446	$	424
Total return incentive fees	1,496		5,978		1,459		2,033		10,280		644
Offering expenses	—		97		222		44		1,281		—
Expense support	—		—		—		—		(1,017)		—
Other class-specific expenses (1)	23		122		648		436		662		16


	Quarter Ended September 30, 2024
	Class FA Shares		Class A Shares		Class T Shares		Class D Shares		Class I Shares		Class S Shares
Base management fees	$	269	$	1,186	$	414	$	499	$	2,301	$	133
Total return incentive fees	399		1,268		410		584		2,345		168
Offering expenses	—		147		22		32		137		—
Expense support	—		—		—		—		335		18
Other class-specific expenses (1)	8		34		224		134		51		5


	Nine Months Ended September 30, 2024
	Class FA Shares		Class A Shares		Class T Shares		Class D Shares		Class I Shares		Class S Shares
Base management fees	$	788	$	3,001	$	1,204	$	1,343	$	6,307	$	385
Total return incentive fees	1,217		3,435		1,249		1,479		7,041		511
Offering expenses	—		359		52		83		385		—
Expense support	—		—		—		—		(1)		1
Other class-specific expenses (1)	26		103		672		375		157		17

(1) Other class-specific expenses consist of distribution and shareholder servicing fees and certain transfer agent fees.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Income and expenses which are not class-specific are allocated monthly pro rata among the share classes based on shares outstanding as of the end of the month.

Net Investment Income per Share and Net Increase in Net Assets Resulting from Operations per Share

Net investment income per share and net increase in net assets resulting from operations per share are calculated for each share class of common shares based upon the weighted average number of common shares outstanding during the reporting period.

Distributions

The Company’s board of directors has declared and intends to continue to declare distributions based on monthly record dates. The Company’s distributions are paid in the same month as the declared record date. Distributions are made on all classes of the Company’s shares at the same time.

The Company has adopted a distribution reinvestment plan that provides for reinvestment of distributions on behalf of shareholders. Non-founder shareholders participating in the distribution reinvestment plan will have their cash distribution automatically reinvested in additional shares having the same class designation as the class of shares to which such distributions are attributable at a price per share equivalent to the then current public offering price, net of up-front selling commissions and dealer manager fees. Cash distributions paid on Class FA shares participating in the distribution reinvestment plan are reinvested in additional Class A shares. Class S shares do not participate in the distribution reinvestment plan.

Income Taxes

Under GAAP, the Company is subject to the provisions of ASC 740, “Income Taxes.” The Company follows the authoritative guidance on accounting for uncertainty in income taxes and concluded it has no material uncertain tax positions to be recognized at this time. If applicable, the Company will recognize interest and penalties related to unrecognized tax benefits as income tax expense in the Company’s condensed consolidated statements of operations.

The Company has operated and expects to continue to operate so that it will qualify to be treated for U.S. federal income tax purposes as a partnership, and not as an association or a publicly traded partnership taxable as a corporation. Generally, if the Company were otherwise treated as a publicly traded partnership, the Company would not be taxable as a corporation if 90% or more of its gross income for each taxable year consists of “qualifying income” (generally, interest (other than interest generated from a financial business), dividends, real property rents, gain from the sale of assets that produce qualifying income and certain other items) and the Company is not required to register under the Investment Company Act (the “qualifying income exception”). As a partnership, the individual shareholders are responsible for their proportionate share of the Company’s taxable income.

The Company holds certain equity investments in taxable subsidiaries (the “Taxable Subsidiaries”). The Taxable Subsidiaries permit the Company to hold equity investments in portfolio companies which are “pass through” entities for tax purposes. The Taxable Subsidiaries are not consolidated with the Company for income tax purposes and may generate income tax expense, benefit, and the related tax assets and liabilities, as a result of the Taxable Subsidiaries’ ownership of certain portfolio investments. The income tax expense, or benefit, and related tax assets and liabilities of the Taxable Subsidiaries are reflected in the Company’s condensed consolidated financial statements. See Note 9. “Income Taxes” for additional information.

During the quarter and nine months ended September 30, 2025 and 2024, the Company did not incur any material interest or penalties. Tax years ending December 31, 2021 and forward remain subject to examination by taxing authorities.

Segment Reporting

The Company operates through a single operating and reporting segment with an investment objective to generate both current income and capital appreciation through debt and equity investments. The chief operating decision maker (the “CODM”) is comprised of the Company’s chief operating officer and the CODM assesses the performance and makes operating decisions of the Company on a consolidated basis primarily based on the Company’s net increase in net assets resulting from operations (“net income”). In addition to numerous other factors and metrics, the CODM utilizes net income, net assets and total return as key metrics in determining the amount of dividends to be distributed to the Company’s shareholders. As the Company’s operations comprise of a single reporting segment, the segment assets are reflected on the accompanying consolidated statement of assets and liabilities as “total assets” and the significant segment expenses are listed on the accompanying consolidated statement of operations.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Reclassifications

Certain reclassifications have been made to the condensed consolidated statement of operations for the quarter and nine months ended September 30, 2024 to conform with the current year presentation. There was no impact on the Company’s consolidated net income, net change in net assets resulting from operations, net cash used in operations or net cash provided by financing activities as a result of the reclassifications.

Recently Adopted and Issued Accounting Standards Updates

In November 2023, the FASB issued ASU 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“ASU 2023-07”). ASU 2023-07 intends to improve reportable segment disclosure requirements, enhance interim disclosure requirements and provide new segment disclosure requirements for entities with a single reportable segment. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods with fiscal years beginning after December 15, 2024. ASU 2023-07 is to be adopted retrospectively to all prior periods presented. The Company adopted this standard for the year ended December 31, 2024.

In December 2023, the FASB issued ASU 2023-09 “Improvements to Income Tax Disclosures” (“ASU 2023-09”). ASU 2023-09 intends to improve the transparency of income tax disclosures. ASU 2023-09 will be effective for the Company in its income tax disclosure included in its Annual Report on Form 10-K for the year ending December 31, 2025. Other than additional disclosure, the Company does not expect a change to its condensed consolidated financial statements.

3. Investments

In January 2025, the Company made an additional equity investment in Madison Retirement Holdings TopCo, LLC (“MAP”) of $4.0 million to purchase the equity interests of a minority shareholder of the portfolio company.

In February 2025, the Company made an additional equity investment in Clarion Safety Systems, LLC (“Clarion”) of approximately $13.5 million for Clarion’s acquisition of McLoone Metal Graphics. Founded in 1954 and headquartered in La Crosse, WI, McLoone manufactures metal nameplates and ID plates and flexible labels utilized by Original Equipment Manufacturers and other suppliers in a variety of end markets. McLoone’s products complement Clarion’s products and services for its customers’ industrial safety needs.

In April 2025, the Company made an additional investment in LOCI Topco Limited (“LBR”) of approximately $25.8 million to partially finance the merger of LBR and ALM Global LLC (“ALM”). ALM was founded in 1979 and is headquartered in New York, New York. Through its leading Law.com platform, ALM offers a global legal newsroom for professionals utilizing proprietary data intelligence, expert analysis and industry insights serving both the practice and business of law. ALM, in combination with LBR, creates a newly formed group uniquely positioned to serve clients globally by combining ALM’s deep U.S. market penetration with LBR’s strong U.K. and global presence.

In June 2025, the Company acquired an approximately 91% indirect equity ownership interest in International Franchise Professionals Group (“IFPG”). The Company’s total investment of approximately $113.5 million in IFPG is comprised of an indirect common equity investment of $90.5 million and a concurrent debt investment of $23.0 million. IFPG is a membership-based organization serving more than 1,300 franchise professionals. As one of the largest member networks and marketplaces dedicated to the franchise industry, IFPG’s customer community is made up of franchisors, franchise consultants and vendors who help potential candidates through the process of identifying and investing in a franchise business.

In June 2025, the Company made an additional equity investment in Milton Industries Inc (“Milton”) of approximately $2.3 million.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

On September 25, 2025, the Company, through its wholly-owned subsidiaries, SDC Strategic Capital EquityCo, LLC and SDC Strategic Capital DebtCo, LLC, made an approximately $7.5 million co-investment alongside other vehicles managed by affiliates of the Sub-Manager in SDC Holdco LLC (“SDC”), which owns a controlling equity interest in the Shipley Do-Nuts business (“Shipley Do-Nuts”). In July 2025, Levine Leichtman Capital Partners VII, L.P. (“LLCP VII”), an affiliate of the Sub-Manager, acquired a controlling equity interest in Shipley Do-Nuts through SDC. The Company’s co-investment is comprised of a combination of an indirect minority common share equity position of approximately $6.8 million and $0.7 million through a participation interest in the second lien secured debt of Shipley Do-Nuts. The Company’s equity investment represents less than 3% of the total equity ownership of Shipley Do-Nuts. The Company’s investment in Shipley Do-Nuts was acquired from LLCP VII at the same price and on substantially similar terms and conditions as LLCP VII’s initial investment in July 2025. The terms of the transaction were approved by the Company’s board of directors, including all of the independent directors of the Company’s board of directors, as fair and reasonable to the Company and at a price to the Company no greater than the cost of the asset to LLCP VII.

The Company’s investment portfolio is summarized as follows as of September 30, 2025 and December 31, 2024 (in thousands):


	As of September 30, 2025
Asset Category	Amortized Cost(1)		Fair Value		Fair Value Percentage of Investment Portfolio		Fair Value Percentage of Net Assets
Senior secured debt
First lien	$	66,990	$	66,990	5.0	%	4.8	%
Secured	171,389		171,389		12.7		12.5
Second lien	62,402		62,402		4.6		4.6
PIK notes	18,830		19,012		1.4		1.4
Total senior secured debt	319,611		319,793		23.7		23.3
Equity
Preferred	74,812		78,416		5.8		5.7
Common	617,861		953,881		70.5		69.6
Total equity	692,673		1,032,297		76.3		75.3
Total investments	$	1,012,284	$	1,352,090	100.0	%	98.6	%


	As of December 31, 2024
Asset Category	Amortized Cost(1)		Fair Value		Fair Value Percentage of Investment Portfolio		Fair Value Percentage of Net Assets
Senior secured debt
First lien	$	66,990	$	66,990	5.9	%	5.4	%
Secured	148,576		148,576		13.0		12.1
Second lien	76,718		76,718		6.7		6.2
Total senior secured debt	292,284		292,284		25.6		23.7
Equity
Preferred	62,070		61,155		5.4		5.0
Common	538,586		787,420		69.0		64.0
Total equity	600,656		848,575		74.4		69.0
Total investments	$	892,940	$	1,140,859	100.0	%	92.7	%

FOOTNOTE:

(1) The amortized cost represents the original cost adjusted for PIK interest and dividends.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Collectively, the Company’s debt investments accrue interest at a weighted average per annum rate of 13.9% and have weighted average remaining years to maturity of 4.3 years as of September 30, 2025. The note purchase agreements contain customary covenants and events of default. As of September 30, 2025, all of the Company’s portfolio companies were in compliance with their respective debt covenants. As of September 30, 2025 and December 31, 2024, none of the Company’s debt investments were on non-accrual status.

The industry dispersion of the Company’s portfolio company investments, based on fair value, as of September 30, 2025 and December 31, 2024 were as follows:


Industry	September 30, 2025		December 31, 2024
Healthcare Supplies	14.5	%	17.0	%
Insurance Services(1)	12.0		—
Commercial and Professional Services	11.5		13.0
Engineered Products	10.3		12.4
Retirement Plan Services	10.3		10.1
Legal Services(2)	9.5		—
Visual Safety Solutions	9.3		7.9
Franchise Consulting Services	8.4		—
Information Services and Advisory Solutions	6.2		12.2
Real Estate Services	5.4		6.3
Hobby Goods and Supplies	2.0		2.5
Restaurant and Food	0.6		—
Business Services	—		13.9
Sanitation Products	—		4.7
Total	100.0	%	100.0	%

FOOTNOTE:

(1)Included in Business Services industry as of December 31, 2024. The Company disaggregated this category as of September 30, 2025.

(2)Included in Business Services and Information Services and Advisory Solutions industries as of December 31, 2024. The Company disaggregated these categories as of September 30, 2025.

Summarized Portfolio Company Financial Information

The Company had two significant portfolio companies in which it owned a controlling equity interest during the quarter and nine months ended September 30, 2025 and 2024. The following tables present unaudited summarized operating data for the quarter and nine months ended September 30, 2025 and 2024, and summarized balance sheet data as of September 30, 2025 (unaudited) and December 31, 2024 for these portfolio companies (in thousands):

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Clarion


	Quarter Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Revenues	$	8,499	$	4,063	$	23,777	$	12,620
Expenses	(6,841)		(3,710)		(20,330)		(10,816)
Income before taxes	1,658		353		3,447		1,804
Income tax expense	(454)		(98)		(945)		(503)
Net income	$	1,204	$	255	$	2,502	$	1,301


	As of September 30, 2025			As of December 31, 2024
Current assets	$	14,094		$	7,124
Non-current assets	83,202			74,214
Current liabilities	2,571			2,551
Non-current liabilities	22,895			22,680

Stockholders’ equity	71,830			56,107
Ownership percentage(1)	95		%	96		%

FOOTNOTE:

(1)Represents the Company’s undiluted ownership percentage as of the end of the period presented, rounded to the nearest percent.

Sill


	Quarter Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Revenues	$	8,031	$	6,391	$	29,876	$	14,636
Expenses	(7,922)		(5,846)		(25,571)		(15,515)
Income (loss) before taxes	109		545		4,305		(879)
Income tax benefit (expense)	375		(1,718)		(327)		(1,038)
Net income (loss)	$	484	$	(1,173)	$	3,978	$	(1,917)


	As of September 30, 2025			As of December 31, 2024
Current assets	$	12,086		$	12,039
Non-current assets	106,032			107,938
Current liabilities	3,957			5,585
Non-current liabilities	19,255			18,908
Stockholders’ equity	94,906			95,484
Ownership percentage(1)	93		%	93		%

FOOTNOTE:

(1)Represents the Company’s undiluted ownership percentage as of the end of the period presented, rounded to the nearest percent.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

4. Fair Value of Financial Instruments

The Company’s investments were categorized in the fair value hierarchy described in Note 2. “Significant Accounting Policies,” as follows as of September 30, 2025 and December 31, 2024 (in thousands):


	As of September 30, 2025								As of December 31, 2024
Description	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Senior Debt	$	—	$	—	$	319,793	$	319,793	$	—	$	—	$	292,284	$	292,284
Equity	—		—		1,032,297		1,032,297		—		—		848,575		848,575
Total Investments	$	—	$	—	$	1,352,090	$	1,352,090	$	—	$	—	$	1,140,859	$	1,140,859

The ranges of unobservable inputs used in the fair value measurement of the Company’s Level 3 investments as of September 30, 2025 and December 31, 2024 were as follows (in thousands):

As of September 30, 2025

Asset Group

Fair Value

Valuation Techniques

Unobservable Inputs

Range

(Weighted Average)(1)

Impact to Valuation from an Increase in

Input(2)

Senior Debt

319,109

Discounted Cash Flow
Market Comparables
Transaction Method

Discount Rate
EBITDA Multiple

10.0% – 16.0% (13.5%)

5.8x – 20.4x (13.1x)

Decrease
Increase

684

Transaction Precedent

Transaction Price

N/A

Equity

1,025,481

Discounted Cash Flow
Market Comparables
Transaction Method

Discount Rate
EBITDA Multiple

10.0% – 16.0% (13.5%)

5.8x – 20.4x (13.1x)

Decrease
Increase

6,816

Transaction Precedent

Transaction Price

N/A

Total

1,352,090

As of December 31, 2024

Asset Group

Fair Value

Valuation Techniques

Unobservable Inputs

Range

(Weighted Average)(1)

Impact to Valuation from an Increase in

Input(2)

Senior Debt

292,284

Discounted Cash Flow
Market Comparables
Transaction Method

Discount Rate
EBITDA Multiple

10.8% – 16.0% (13.4%)

6.3x – 21.7x (12.4x)

Decrease
Increase

Equity

848,575

Discounted Cash Flow
Market Comparables
Transaction Method

Discount Rate
EBITDA Multiple

10.8% – 16.0% (13.4%)

6.3x – 21.7x (12.4x)

Decrease
Increase

Total

1,140,859

FOOTNOTES:

(1) Discount rates are relative to the enterprise value of the portfolio companies and are not the market yields on the associated debt investments. Unobservable inputs were weighted by the relative fair value of the investments.

(2) This column 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.

The preceding tables include the significant unobservable inputs as they relate to the Company’s determination of fair values for its investments categorized within Level 3 as of September 30, 2025 and December 31, 2024. In addition to the techniques and inputs noted in the tables above, according to the Company’s valuation policy, the Company may also use other valuation techniques and methodologies when determining the fair value estimates for the Company’s investments. Any significant increases or decreases in the unobservable inputs would result in significant increases or decreases in the fair value of the Company’s investments.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Investments that do not have a readily available market value are valued utilizing a market approach, an income approach (i.e. discounted cash flow approach), a transaction approach, or a combination of such approaches, as appropriate. The market approach uses prices, including third party indicative broker quotes, and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business). The transaction approach uses pricing indications derived from recent precedent merger and acquisition transactions involving comparable target companies. The income approach uses valuation techniques to convert future amounts (for example, cash flows or earnings) that are discounted based on a required or expected discount rate to derive a present value amount range. The measurement is based on the value indicated by current market expectations about those future amounts. In following these approaches, the types of factors the Company may take into account to determine the fair value of its investments include, as relevant: available current market data, including an assessment of the credit quality of the security’s issuer, relevant and applicable market trading and transaction comparables, applicable market yields and multiples, illiquidity discounts, security covenants, call protection provisions, information rights, the nature and realizable value of any collateral, the portfolio company’s ability to make payments, its earnings and cash flows, the markets in which the portfolio company does business, comparisons of financial ratios of peer companies that are public, data derived from merger and acquisition activities for comparable companies, and enterprise values, among other factors.

The following tables provide a reconciliation of investments for which Level 3 inputs were used in determining fair value for the nine months ended September 30, 2025 and 2024 (in thousands):


	Nine Months Ended September 30, 2025
	Senior Debt		Equity		Total
Fair value balance as of January 1, 2025	$	292,284	$	848,575	$	1,140,859
Additions	41,602		124,970		166,572
Disposals and repayments of debt investments	(15,000)		(35,500)		(50,500)
Principal repayment	(188)		—		(188)
PIK interest and dividends	913		4,888		5,801
Return of capital(1)	—		(2,342)		(2,342)
Net change in unrealized appreciation, including unrealized foreign currency gain	182		91,706		91,888
Fair value balance as of September 30, 2025	$	319,793	$	1,032,297	$	1,352,090
Change in net unrealized appreciation on investments held as of September 30, 2025	$	182	$	91,706	$	91,888


	Nine Months Ended September 30, 2024
	Senior Debt		Equity		Total
Fair value balance as of January 1, 2024	$	276,158	$	600,685	$	876,843
Additions	9,376		113,531		122,907
Principal repayment	(188)		—		(188)
PIK dividends	—		1,490		1,490
Return of capital(1)	—		(2,445)		(2,445)
Net change in unrealized appreciation	—		53,314		53,314
Fair value balance as of September 30, 2024	$	285,346	$	766,575	$	1,051,921
Change in net unrealized appreciation on investments held as of September 30, 2024	$	—	$	53,314	$	53,314

FOOTNOTE:

(1) Represents portion of distributions received which were accounted for as a return of capital. See Note 2. “Significant Accounting Policies” for information on the accounting treatment of distributions from portfolio companies.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

5. Related Party Transactions

The Manager and Sub-Manager, along with certain affiliates of the Manager or Sub-Manager, receive fees and compensation in connection with the Public Offerings, as well as the acquisition, management and sale of the assets of the Company, as follows:

Managing Dealer

Commissions — The Company pays CNL Securities Corp. (the “Managing Dealer”), an affiliate of the Manager, a selling commission up to 6.00% of the sale price for each Class A share and 3.00% of the sale price for each Class T share sold in the Public Offerings (excluding sales pursuant to the Company’s distribution reinvestment plan). The Managing Dealer may reallow all or a portion of the selling commissions to participating broker-dealers.

Dealer Manager Fee — The Company pays the Managing Dealer a dealer manager fee of up to 2.50% of the price of each Class A share and 1.75% of the price of each Class T share sold in the Public Offerings (excluding sales pursuant to the Company’s distribution reinvestment plan). The Managing Dealer may reallow all or a portion of such dealer manager fees to participating broker-dealers.

Distribution and Shareholder Servicing Fee — The Company pays the Managing Dealer a distribution and shareholder servicing fee, subject to certain limits, with respect to its Class T and Class D shares sold in the Public Offerings (excluding Class T shares and Class D shares sold through the distribution reinvestment plan and those received as share distributions) in an annual amount equal to 1.00% and 0.50%, respectively, of its current net asset value per share, as disclosed in its periodic or current reports, payable on a monthly basis. The distribution and shareholder servicing fee accrues daily and is paid monthly in arrears. The Managing Dealer may reallow all or a portion of the distribution and shareholder servicing fee to the broker-dealer who sold the Class T or Class D shares or, if applicable, to a servicing broker-dealer of the Class T or Class D shares or a fund supermarket platform featuring Class D shares, so long as the broker-dealer or financial intermediary has entered into a contractual agreement with the Managing Dealer that provides for such reallowance. The distribution and shareholder servicing fee is an ongoing fee, subject to certain limits, that is allocated among all Class T and Class D shares, respectively, and is not paid at the time of purchase.

Manager and/or Sub-Manager

Offering Costs — The Company reimburses the Manager and the Sub-Manager, along with their respective affiliates, for the offering costs (other than selling commissions and dealer manager fees) they have incurred on the Company’s behalf only to the extent that such expenses do not exceed 1.5% of the cumulative gross proceeds from the Public Offerings. The Company incurred an obligation to reimburse the Manager and Sub-Manager for offering costs based on actual amounts raised through the Public Offerings of approximately $0.5 million and $0.3 million during the quarter ended September 30, 2025 and 2024, respectively, and approximately $1.6 million and $0.9 million during the nine months ended September 30, 2025 and 2024, respectively.

Base Management Fee to Manager and Sub-Manager — The Company pays each of the Manager and the Sub-Manager 50% of the total base management fee for their services under the Management Agreement and the Sub-Management Agreement, subject to any reduction or deferral of any such fees pursuant to the terms of the Expense Support and Conditional Reimbursement Agreement described below. The Company incurred base management fees of approximately $6.4 million and $4.8 million for the quarter ended September 30, 2025 and 2024, respectively, and approximately $17.5 million and $13.0 million during the nine months ended September 30, 2025 and 2024, respectively.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

The base management fee is calculated for each share class at an annual rate of (i) for the Non-founder shares of a particular class, 2% of the product of (x) the Company’s average gross assets and (y) the ratio of Non-founder shares Average Adjusted Capital (as defined below), for a particular class to total Average Adjusted Capital and (ii) for the Founder shares of a particular class, 1% of the product of (x) the Company’s average gross assets and (y) the ratio of outstanding Founder shares Average Adjusted Capital for a particular class to total Average Adjusted Capital, in each case excluding cash, and is payable monthly in arrears. The management fee for a certain month is calculated based on the average value of the Company’s gross assets at the end of that month and the immediately preceding calendar month. The determination of gross assets reflects changes in the fair market value of the Company’s assets, which does not necessarily equal their notional value, reflecting both realized and unrealized capital appreciation or depreciation. The base management fee may be reduced or deferred by the Manager and the Sub-Manager under the Management Agreement and the Expense Support and Conditional Reimbursement Agreement described below. For purposes of this calculation, “Average Adjusted Capital” for an applicable class is computed on the daily Adjusted Capital for such class for the actual number of days in such applicable month. “Adjusted Capital” is defined as cumulative proceeds generated from sales of the Company’s shares of a particular share class (including proceeds from the sale of shares pursuant to the distribution reinvestment plan, if any), net of upfront selling commissions and dealer manager fees (“sales load”), if any, reduced for the full amounts paid for share repurchases pursuant to any share repurchase program, if any, and adjusted for share conversions, if any, for such class.

Total Return Incentive Fee on Income to the Manager and Sub-Manager — The Company also pays each of the Manager and the Sub-Manager 50% of the total return incentive fee for their services under the Management Agreement and the Sub-Management Agreement. The Company recorded total return incentive fees of approximately $8.4 million and $5.2 million for the quarter ended September 30, 2025 and 2024, respectively, and approximately $21.9 million and $14.9 million during the nine months ended September 30, 2025 and 2024, respectively.

The total return incentive fee is based on the Total Return to Shareholders (as defined below) for each share class in any calendar year, payable annually in arrears. The Company will accrue (but not pay) the total return incentive fee on a monthly basis, to the extent that it is earned on an annualized basis. The Company will perform a final reconciliation of the total return incentive fee calculation at the completion of each calendar year and the total return incentive fee shall be due and payable to the Manager no later than ninety (90) calendar days following the end of the applicable calendar year. The total return incentive fee may be reduced or deferred by the Manager and the Sub-Manager under the Management Agreement and the Expense Support and Conditional Reimbursement Agreement described below.

For purposes of this calculation, “Total Return to Shareholders” for each annualized period is calculated for each share class as the change in the net asset value for such share class plus total distributions for such share class calculated based on the Average Adjusted Capital for such class as of each calendar month end. The terms “Total Return to Non-founder Shareholders” and “Total Return to Founder Shareholders” mean the Total Return to Shareholders specifically attributable to each particular share class of Non-founder shares or Founder shares, as applicable.

The total return incentive fee for each share class is calculated as follows:

•No total return incentive fee will be payable in any calendar year in which the annualized Total Return to Shareholders of a particular share class does not exceed 7% (the “Annual Preferred Return”).

•As it relates to the Non-founder shares, all of the Total Return to Shareholders with respect to each particular share class of Non-founder shares, if any, that exceeds the annual preferred return, but is less than or equal to 8.75%, or the “Non-founder breakpoint,” in any calendar year, will be payable to the Manager (“Non-founder Catch Up”). The Non-Founder Catch Up is intended to provide an incentive fee of 20% of the Total Return to Non-founder Shareholders of a particular share class once the Total Return to Non-founder Shareholders of a particular class exceeds 8.75% in any calendar year.

•As it relates to Founder shares, all of the Total Return to Founder Shareholders with respect to each particular share class of Founder shares, if any, that exceeds the annual preferred return, but is less than or equal to 7.777%, or the “founder breakpoint,” in any calendar year, will be payable to the Manager (“Founder Catch Up”). The Founder Catch Up is intended to provide an incentive fee of 10% of the Total Return to Founder Shareholders of a particular share class once the Total Return to Founder Shareholders of a particular class exceeds 7.777% in any calendar year.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

•For any annualized period in which the Total Return to Shareholders of a particular share class exceeds the relevant breakpoint, the total return incentive fee of a particular share class shall equal, for Non-founder shares, 20% of the Total Return to Non-founder Shareholders of a particular class, and for Founder shares, 10% of the Total Return to Founder Shareholders of a particular class, in each case because the annual preferred and relevant catch ups will have been achieved.

•For purposes of calculating the Total Return to Shareholders, the change in the Company’s net asset value is subject to a High Water Mark. The “High Water Mark” is equal to the highest year-end net asset value, for each share class of the Company since inception, adjusted for any special distributions resulting from the sale of the Company’s assets, provided such adjustment is approved by the Company’s board of directors. If, as of each calendar year end, the Company’s net asset value for the applicable share class is (A) above the High Water Mark, then, for such calendar year, the Total Return to Shareholders calculation will include the increase in the Company’s net asset value for such share class in excess of the High Water Mark, and (B) if the Company’s net asset value for the applicable share class is below the High Water Mark, for such calendar year, (i) any increase in the Company’s per share net asset value will be disregarded in the calculation of Total Return to Shareholders for such share class while (ii) any decrease in the Company’s per share net asset value will be included in the calculation of Total Return to Shareholders for such share class. With respect to the calculation of Total Return to Shareholders, the following tables provides the applicable High Water Marks for the years ended December 31, 2025 and 2024:


For the year ended:	Class FA		Class A		Class T		Class D		Class I		Class S
December 31, 2025	$	39.55	$	35.68	$	35.72	$	35.42	$	36.12	$	40.09
December 31, 2024	36.67		33.57		33.64		33.31		34.06		37.25

For purposes of this calculation, “Average Adjusted Capital” for an applicable class is computed on the daily Adjusted Capital for such class for the actual number of days in such applicable period. The annual preferred return of 7% and the relevant breakpoints of 8.75% and 7.777%, respectively, are also adjusted for the actual number of days in each calendar year, measured as of each calendar month end.

Reimbursement to Manager and Sub-Manager for Operating Expenses and Pursuit Costs — The Company reimburses the Manager and the Sub-Manager and their respective affiliates for certain third party operating expenses and pursuit costs incurred in connection with their provision of services to the Company, including fees, costs, expenses, liabilities and obligations relating to the Company’s activities, acquisitions, dispositions, financings and business, subject to the terms of the Company’s limited liability company agreement, the Management Agreement, the Sub-Management Agreement and the Expense Support and Conditional Reimbursement Agreement (as defined below). The Company does not reimburse the Manager and Sub-Manager for administrative services performed by the Manager or Sub-Manager for the benefit of the Company.

Expense Support and Conditional Reimbursement Agreement — The Company entered into an expense support and conditional reimbursement agreement with the Manager and the Sub-Manager, as amended, (the “Expense Support and Conditional Reimbursement Agreement”), which became effective on February 7, 2018, pursuant to which each of the Manager and the Sub-Manager agrees to reduce the payment of base management fees, total return incentive fees and the reimbursements of reimbursable expenses due to the Manager and the Sub-Manager under the Management Agreement and the Sub-Management Agreement, as applicable, to the extent that the Company’s annual regular cash distributions exceed its annual net income (with certain adjustments). The amount of such expense support is equal to the annual (calendar year) excess, if any, of (a) the distributions (as defined in the Expense Support and Conditional Reimbursement Agreement) declared and paid (net of the Company’s distribution reinvestment plan) to shareholders minus (b) the available operating funds, as defined in the Expense Support and Conditional Reimbursement Agreement (the “Expense Support”).

The Expense Support amount is borne equally by the Manager and the Sub-Manager and is calculated as of the last business day of the calendar year. Until the Expense Support and Conditional Reimbursement Agreement is terminated, the Manager and Sub-Manager shall equally conditionally reduce the payment of fees and reimbursements of reimbursable expenses in an amount equal to the conditional waiver amount (as defined in and subject to limitations described in the Expense Support and Conditional Reimbursement Agreement). The term of the Expense Support and Conditional Reimbursement Agreement has the same initial term and renewal terms as the Management Agreement or the Sub-Management Agreement, as applicable, to the Manager or the Sub-Manager. Expense support is paid by the Manager and Sub-Manager annually in arrears.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

If, on the last business day of the calendar year, the annual (calendar year) year-to-date available operating funds exceeds the sum of the annual (calendar year) year-to-date distributions paid per share class (the “Excess Operating Funds”), the Company uses such Excess Operating Funds to pay the Manager and the Sub-Manager all or a portion of the outstanding unreimbursed Expense Support amounts for each share class, as applicable, subject to certain conditions (the “Conditional Reimbursements”) as described further in the Expense Support and Conditional Reimbursement Agreement. The Company’s obligation to make Conditional Reimbursements shall automatically terminate and be of no further effect three years following the date which the Expense Support amount was provided and to which such Conditional Reimbursement relates, as described further in the Expense Support and Conditional Reimbursement Agreement.

Since inception, the Company has received cumulative Expense Support of approximately $5.1 million. Of the Expense Support received through September 30, 2025, approximately $4.9 million had been reimbursed and approximately $0.2 million was no longer eligible for reimbursement. As of September 30, 2025, approximately less than $0.1 million of Expense Support collected from the Manager and Sub-Manager is subject to reimbursement.

Distributions

Individuals and entities affiliated with the Manager and Sub-Manager owned approximately 0.4 million shares as of September 30, 2025 and 2024. These individuals and entities received distributions from the Company of approximately $0.1 million for each of the quarter ended September 30, 2025 and 2024, and approximately $0.4 million during each of the nine months ended September 30, 2025 and 2024.

Related party fees and expenses incurred for the quarter and nine months ended September 30, 2025 and 2024 are summarized below (in thousands):


		Quarter Ended September 30,				Nine Months Ended September 30,
Related Party	Source Agreement & Description	2025		2024		2025		2024
Managing Dealer	Managing Dealer Agreement: Commissions(1)	$	180	$	692	$	465	$	1,734
	Dealer manager fees(1)	104		107		266		266
	Distribution and shareholder servicing fees(2)	327		334		998		971
Manager and Sub-Manager	Management Agreement and Sub-Management Agreement: Offering expense reimbursement(3)(4)	494		338		1,644		879
	Base management fees(3)	6,420		4,802		17,490		13,028
	Total return incentive fees(3)	8,423		5,174		21,890		14,932
Manager and Sub-Manager	Expense Support and Conditional Reimbursement Agreement: Expense Support	2,875		353		(1,017)		—


Manager	Administrative Services Agreement: Reimbursement of third-party operating expenses(3)(5)	36		131		124		378
	Shareholder servicing fees(2)	168		—		485		—
Sub-Manager	Sub-Management Agreement: Reimbursement of third-party pursuit costs(3)(6)	220		(159)		911		843

FOOTNOTES:

(1)Included in “Issuance of common shares through the Public Offerings” in the Company’s condensed consolidated statements of changes in net assets.

(2)Included in “Distribution and shareholder servicing fees” in the Company’s condensed consolidated statements of operations.

(3)Expenses subject to Expense Support, if applicable.

(4)Offering expense reimbursements are capitalized on the Company’s condensed consolidated statements of assets and liabilities as deferred offering expenses and expensed to the Company’s condensed consolidated statements of operations over the lesser of the offering period or 12 months.

(5)Included in “Professional services” in the Company’s condensed consolidated statements of operations.

(6)Includes reimbursement of third-party fees incurred for investments that did not close, including fees and expenses associated with performing due diligence reviews.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

The following table presents amounts due to related parties net as of September 30, 2025 and December 31, 2024 (in thousands):


	September 30, 2025		December 31, 2024
Due from related parties:
Expense Support	$	1,017	$	20
Total due from related parties	1,017		20
Due to related parties:
Total return incentive fees	$	(21,890)	$	(24,119)

Base management fees	(2,074)		(1,758)
Offering expenses	(212)		(138)
Distribution and shareholder servicing fees	(108)		(115)
Reimbursement of third-party operating expenses and pursuit costs	(602)		(276)
Total due to related parties	$	(24,886)	$	(26,406)
Due to related parties, net	$	(23,869)	$	(26,386)

6. Distributions

The Company’s board of directors declared distributions on a monthly basis in each of the nine months ended September 30, 2025 and 2024 (nine record dates). The following table reflects the total distributions declared during the nine months ended September 30, 2025 and 2024 (in thousands except per share data):


	Nine Months Ended September 30,
	2025						2024
Distribution Period	Distributions Declared(1)		Distributions Reinvested(2)		Cash Distributions Net of Distributions Reinvested(2)		Distributions Declared(1)(2)		Distributions Reinvested(2)		Cash Distributions Net of Distributions Reinvested(2)
First Quarter	$	10,372	$	5,175	$	5,197	$	8,807	$	4,056	$	4,751
Second Quarter	10,547		5,335		5,212		9,214		4,344		4,870
Third Quarter	10,813		5,519		5,294		9,676		4,693		4,983

	$	31,732	$	16,029	$	15,703	$	27,697	$	13,093	$	14,604

FOOTNOTES:

(1) The Company’s board of directors declared distributions per share on a monthly basis. See Note 12. “Financial Highlights” for distributions declared by share class. Monthly distributions declared per share for each share class were as follows:


Record Date Period	Class FA		Class A		Class T		Class D		Class I		Class S
January 1, 2025 - September 30, 2025	$	0.104167	$	0.104167	$	0.083333	$	0.093750	$	0.104167	$	0.104167
January 1, 2024 - September 30, 2024	0.104167		0.104167		0.083333		0.093750		0.104167		0.104167

(2) Amounts based on distribution record date.

The sources of declared distributions on a GAAP basis were as follows (in thousands):


	Nine Months Ended September 30,
	2025				2024
	Amount		% of Distributions Declared		Amount		% of Distributions Declared
Net investment income(1)	$	14,470	45.6	%	$	17,618	63.6	%
Net realized gain	1,432		4.5		—		—
Distributions in excess of net investment income(2)	15,830		49.9		10,079		36.4
Total distributions declared	$	31,732	100.0	%	$	27,697	100.0	%

FOOTNOTES:

(1) Net investment income includes Expense Support of $1,017 and $0 for the nine months ended September 30, 2025 and 2024, respectively. See Note 5. “Related Party Transactions” for additional information.

(2) Consists of distributions made from offering proceeds for the periods presented.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

In September 2025, the Company’s board of directors declared a monthly cash distribution on the outstanding shares of all classes of common shares of record on October 27, 2025 of $0.104167 per share for Class FA shares, $0.104167 per share for Class A shares, $0.083333 per share for Class T shares, $0.093750 per share for Class D shares, $0.104167 per share for Class I shares and $0.104167 per share for Class S shares.

7. Capital Transactions

Public Offerings

Under the Second Follow-On Public Offering, the Company has offered and continues to offer up to $1.0 billion of shares, on a best efforts basis, which means that CNL Securities Corp., as the Managing Dealer of the Second Follow-On Public Offering, uses its best effort but is not required to sell any specific amount of shares. The Company is offering, in any combination, four classes of shares in the Second Follow-On Public Offering: Class A shares, Class T shares, Class D shares and Class I shares. The initial minimum permitted purchase amount is $5,000 in shares. There are differing selling fees and commissions for each share class. The Company also pays distribution and shareholder servicing fees, subject to certain limits, on the Class T and Class D shares sold in the Public Offerings (excluding sales pursuant to the Company’s distribution reinvestment plan). The public offering price, selling commissions and dealer manager fees per share class are determined monthly as approved by the Company’s board of directors. As of September 30, 2025, the public offering price was $40.96 per Class A share, $39.23 per Class T share, $37.19 per Class D share and $37.98 per Class I share.

The Company is also offering, in any combination, up to $100.0 million of Class A shares, Class T shares, Class D shares and Class I shares to be issued pursuant to its distribution reinvestment plan.

See Note 13. “Subsequent Events” for additional information related to the Public Offerings.

The following tables summarize the total shares issued and proceeds received by share class in connection with the Public Offerings, excluding shares repurchased through the Share Repurchase Program described further below, for the nine months ended September 30, 2025 and 2024 (in thousands except per share data):


	Nine Months Ended September 30, 2025
	Proceeds from Public Offerings							Distributions Reinvested			Total
Share Class	Shares Issued	Gross Proceeds		Sales Load(1)		Net Proceeds to Company		Shares Issued	Proceeds to Company		Shares Issued	Net Proceeds to Company		Average Net Proceeds per Share

Class A	15	$	576	$	(45)	$	531	152	$	5,547	167	$	6,078	$	36.35
Class T	395	15,103		(686)		14,417		33	1,204		428	15,621		36.48
Class D	65	2,343		—		2,343		42	1,545		107	3,888		36.14
Class I	2,309	85,187		—		85,187		210	7,733		2,519	92,920		36.89

	2,784	$	103,209	$	(731)	$	102,478	437	$	16,029	3,221	$	118,507	$	36.78


	Nine Months Ended September 30, 2024
	Proceeds from Public Offerings							Distributions Reinvested			Total
Share Class	Shares Issued	Gross Proceeds		Sales Load(1)		Net Proceeds to Company		Shares Issued	Proceeds to Company		Shares Issued	Net Proceeds to Company		Average Net Proceeds per Share

Class A	2,013	$	69,980	$	(1,542)	$	68,438	115	$	3,920	2,128	$	72,358	$	34.00
Class T	282	10,061		(458)		9,603		39	1,320		321	10,923		34.05
Class D	476	16,070		—		16,070		42	1,415		518	17,485		33.76
Class I	2,177	75,022		—		75,022		187	6,438		2,364	81,460		34.46

	4,948	$	171,133	$	(2,000)	$	169,133	383	$	13,093	5,331	$	182,226	$	34.18

FOOTNOTE:

(1)The Company incurs selling commissions and dealer manager fees on the sale of Class A and Class T shares sold through the Public Offerings. See Note 5. “Related Party Transactions” for additional information regarding up-front selling commissions and dealer manager fees.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Share Repurchase Program

In accordance with the Share Repurchase Program, the total amount of aggregate repurchases of Class FA, Class A, Class T, Class D, Class I and Class S shares is limited to up to 2.5% of the aggregate net asset value per calendar quarter (based on the aggregate net asset value as of the last date of the month immediately prior to the repurchase date) and up to 10% of the aggregate net asset value per year (based on the average aggregate net asset value as of the end of each of the Company’s trailing four quarters). At the sole discretion of the Company’s board of directors, the Company may use sources, including, but not limited to, offering proceeds and borrowings to repurchase shares.

During the nine months ended September 30, 2025 and 2024, the Company received requests for the repurchase of approximately $46.2 million and $38.3 million, respectively, of the Company’s common shares. The Company’s board of directors approved the repurchase requests.

The following table summarizes the shares repurchased during the nine months ended September 30, 2025 and 2024 (in thousands except per share data):


	Shares Repurchased	Total Consideration		Average Price Paid per Share
Class FA	146	$	5,891	$	40.32
Class A	146	5,342		36.66
Class T	57	2,081		36.75
Class D	125	4,491		35.90
Class I	749	27,844		37.13
Class S	13	527		41.12
Nine Months Ended September 30, 2025	1,236	$	46,176	$	37.35


	Shares Repurchased	Total Consideration		Average Price Paid per Share
Class FA	139	$	5,199	$	37.19
Class A	114	3,890		34.01
Class T	134	4,505		33.86
Class D	61	2,051		33.70
Class I	627	21,675		34.53
Class S	27	1,003		38.03
Nine Months Ended September 30, 2024	1,102	$	38,323	$	34.77

As of September 30, 2025 and December 31, 2024, the Company had a payable for shares repurchased of approximately $16.5 million and $19.2 million, respectively, which were paid in October and January 2025, respectively.

Share Conversions

Class T and Class D shares are converted into Class A shares once the maximum amount of distribution and shareholder servicing fees for those particular shares has been met. The shares to be converted are multiplied by the applicable conversion rate, the numerator of which is the net asset value per share of the share class being converted and the denominator of which is the net asset value per Class A share.

During the nine months ended September 30, 2025, approximately 638,000 Class T shares were converted to approximately 638,000 Class A shares at an average conversion rate of 1.00. During the nine months ended September 30, 2024, approximately 247,000 Class T shares were converted to approximately 247,000 Class A shares at an average conversion rate of 1.00.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

8. Borrowings

In February 2024, CNL Strategic Capital B, Inc. (“Borrower”), a wholly-owned subsidiary of the Company, and Valley National Bank, entered into a Revolving Loan Agreement (the “2024 Loan Agreement”) for a $50.0 million revolving line of credit (the “2024 Line of Credit”). In connection with the 2024 Line of Credit, the Borrower paid a total commitment fee and Valley National Bank expenses of $0.2 million. The Borrower is required to pay interest on any borrowed amounts under the 2024 Line of Credit at a rate per year equal to the 1-Month Term SOFR plus 2.75%. Interest payments are due on the first calendar day of the month in arrears. Furthermore, the Borrower is required to pay a quarterly unused borrowing fee at an annual rate of 0.15% on the difference between (i) total 2024 Line of Credit amount and (ii) the aggregate average daily balance of outstanding borrowings under the 2024 Line of Credit during such quarter. The Borrower may prepay, without penalty, all or any part of the borrowings under the 2024 Loan Agreement at any time and such borrowings are required to be repaid within 180 days of the borrowing date. Under the 2024 Loan Agreement, the Company is required to comply with certain covenants including the requirement to provide certain financial and compliance reports to Valley National Bank and restrictions on incurring certain levels of additional debt by the Company.

In February 2024, the Company entered into a Guaranty agreement to act as a guarantor of the Borrower’s outstanding borrowings under the 2024 Loan Agreement (the “Guaranty Agreement”). On February 15, 2024, the Borrower and the Company also entered into a pledge and assignment of bank and deposit accounts (“2024 Pledge Agreement”) in favor of Valley National Bank. Under the 2024 Pledge Agreement, the Company is required to maintain accounts with Valley National Bank, including to contribute proceeds from the Company’s offering, as a pledge of collateral to pay down the outstanding debt to the extent there are any borrowings outstanding under the 2024 Loan Agreement.

In February 2025, the Company amended the 2024 Loan Agreement and related promissory note with Valley National Bank for the 2024 Line of Credit to extend the revolving maturity date to February 15, 2026. The amendment additionally grants Valley National Bank the ability to increase the maximum commitment an additional $50.0 million at their discretion. In connection with the extension of the 2024 Line of Credit, the Borrower paid a total commitment fee and Valley National Bank expenses of $0.1 million.

The Company borrowed and repaid $30.0 million during the nine months ended September 30, 2025 and no amounts under the 2024 Line of Credit were outstanding as of September 30, 2025.

9. Income Taxes

The Company incurs income tax expense related to its Taxable Subsidiaries. The components of income tax expense were as follows during the quarter and nine months ended September 30, 2025 and 2024 (in thousands):


	Quarter Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Current tax expense	$	28	$	15	$	75	$	10
Deferred tax expense	3,497		1,300		8,510		2,567
Total income tax expense	$	3,525	$	1,315	$	8,585	$	2,577

The effective tax rate for the nine months ended September 30, 2025 and 2024 was 8.0% and 3.6%, respectively. The primary items giving rise to the difference between the 21.0% federal statutory rate applicable to corporations and the effective tax rates are due to state taxes and the benefits of the partnership structure.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

Significant components of the Company’s deferred tax assets and liabilities as of September 30, 2025 and December 31, 2024 were as follows (in thousands):


	September 30, 2025		December 31, 2024
Deferred tax assets:
Carryforwards of net operating loss	$	4,113	$	1,818

Other	75		45
Valuation allowance	(379)		(383)
Total deferred tax assets	3,809		1,480
Deferred tax liabilities:

Unrealized appreciation on investments	(22,163)		(11,324)
Total deferred tax liabilities	(22,163)		(11,324)
Deferred tax liabilities, net	$	(18,354)	$	(9,844)

10. Concentrations of Risk

The Company had two portfolio companies which met at least one of the significance tests under Rule 10-01(b) of Regulation S-X for at least one of the periods presented in the condensed consolidated financial statements.

The portfolio companies are required to make monthly interest payments on their debt, with the debt principal due upon maturity. Failure of any of these portfolio companies to pay contractual interest payments could have a material adverse effect on the Company’s results of operations and cash flows from operations, which would impact its ability to make distributions to shareholders.

11. Commitments & Contingencies

See Note 5. “Related Party Transactions” for information on contingent amounts due to the Manager and Sub-Manager for the reimbursement of offering costs under the Public Offerings and for the reimbursement of Expense Support.

From time to time, the Company and officers or directors of the Company may be party to certain legal proceedings in the ordinary course of business, including proceedings relating to the enforcement of the Company’s rights under contracts with its businesses. As of September 30, 2025, the Company was not involved in any legal proceedings.

In addition, in the normal course of business, the Company enters into contracts with its vendors and others that provide for general indemnifications. The Company’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company. However, based on experience, the Company expects that risk of loss to be remote.

12. Financial Highlights

The following are schedules of financial highlights of the Company attributed to each class of shares for the nine months ended September 30, 2025 and 2024 (in thousands except per share data):


	Nine Months Ended September 30, 2025
	Class FA Shares		Class A Shares		Class T Shares		Class D Shares		Class I Shares		Class S Shares
OPERATING PERFORMANCE PER SHARE
Net Asset Value, Beginning of Period	$	39.55	$	35.68	$	35.72	$	35.42	$	36.12	$	40.09
Net investment income, before Expense Support (reimbursement)(1)	1.00		0.34		0.08		0.24		0.27		0.97
Expense Support (reimbursement)(1)(2)	—		—		—		—		0.07		—
Net investment income(1)	1.00		0.34		0.08		0.24		0.34		0.97
Net realized and unrealized gains, net of taxes(1)(3)	2.44		2.43		2.41		2.42		2.44		2.43
Net increase resulting from investment operations	3.44		2.77		2.49		2.66		2.78		3.40
Distributions to shareholders(4)	(0.94)		(0.94)		(0.75)		(0.84)		(0.94)		(0.94)

Net decrease resulting from distributions to shareholders	(0.94)		(0.94)		(0.75)		(0.84)		(0.94)		(0.94)
Net Asset Value, End of Period	$	42.05	$	37.51	$	37.46	$	37.24	$	37.96	$	42.55

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025


	Nine Months Ended September 30, 2025
	Class FA Shares			Class A Shares			Class T Shares			Class D Shares			Class I Shares			Class S Shares

Net assets, end of period	$	162,757		$	333,763		$	84,073		$	113,745		$	604,439		$	72,310
Average net assets(5)	$	159,387		$	300,536		$	86,273		$	108,686		$	543,812		$	69,777
Shares outstanding, end of period	3,871			8,897			2,244			3,054			15,924			1,699
Distributions declared	$	3,700		$	8,008		$	1,790		$	2,577		$	14,057		$	1,600
Total investment return based on net asset value before total return incentive fee(6)	9.80		%	9.80		%	8.91		%	9.54		%	9.63		%	9.55		%
Total investment return based on net asset value after total return incentive fee(6)	8.57		%	7.87		%	7.06		%	7.62		%	7.80		%	8.59		%
RATIOS/SUPPLEMENTAL DATA (not annualized):
Ratios to average net assets:(5)(7)
Total operating expenses before total return incentive fee	0.83		%	2.04		%	2.76		%	2.30		%	2.24		%	0.92		%
Total operating expenses before Expense Support (reimbursement)	1.77		%	4.03		%	4.46		%	4.17		%	4.13		%	1.85		%
Total operating expenses after Expense Support (reimbursement)	1.77		%	4.03		%	4.46		%	4.17		%	3.95		%	1.85		%
Net investment income before total return incentive fee(8)	3.42		%	2.95		%	1.90		%	2.55		%	2.82		%	3.30		%
Net investment income	2.48		%	0.96		%	0.21		%	0.68		%	0.93		%	2.38		%


	Nine Months Ended September 30, 2024
	Class FA Shares			Class A Shares			Class T Shares			Class D Shares			Class I Shares			Class S Shares
OPERATING PERFORMANCE PER SHARE
Net Asset Value, Beginning of Period	$	36.67		$	33.57		$	33.64		$	33.31		$	34.06		$	37.25
Net investment income before Expense Support (reimbursement)(1)	1.04			0.51			0.30			0.42			0.50			1.01
Expense Support (reimbursement)(1)(2)	—			—			—			—			—			—
Net investment income(1)	1.04			0.51			0.30			0.42			0.50			1.01
Net realized and unrealized gains, net of taxes(1)(3)	1.64			1.64			1.64			1.64			1.64			1.64
Net increase resulting from investment operations	2.68			2.15			1.94			2.06			2.14			2.65
Distributions to shareholders(4)	(0.94)			(0.94)			(0.75)			(0.84)			(0.94)			(0.94)

Net decrease resulting from distributions to shareholders	(0.94)			(0.94)			(0.75)			(0.84)			(0.94)			(0.94)

Net Asset Value, End of Period	$	38.41		$	34.78		$	34.83		$	34.53		$	35.26		$	38.96

Net assets, end of period	$	155,153		$	257,844		$	89,487		$	106,647		$	487,709		$	67,080
Average net assets(5)	$	153,495		$	208,435		$	88,129		$	95,173		$	447,371		$	65,922
Shares outstanding, end of period	4,040			7,413			2,569			3,089			13,832			1,721
Distributions declared	$	3,861		$	5,733		$	1,943		$	2,378		$	12,150		$	1,632
Total investment return based on net asset value before total return incentive fee(6)	8.18		%	7.91		%	7.31		%	7.76		%	7.91		%	8.02		%
Total investment return based on net asset value after total return incentive fee(6)	7.20		%	6.50		%	5.84		%	6.29		%	6.37		%	7.21		%
RATIOS/SUPPLEMENTAL DATA (not annualized):
Ratios to average net assets:(5)(7)
Total operating expenses before total return incentive fee	0.87		%	2.05		%	2.57		%	2.28		%	1.91		%	0.95		%
Total operating expenses before Expense Support (reimbursement)	1.67		%	3.69		%	3.98		%	3.83		%	3.48		%	1.72		%
Total operating expenses after Expense Support (reimbursement)	1.67		%	3.69		%	3.98		%	3.83		%	3.48		%	1.72		%
Net investment income before total return incentive fee(8)	3.57		%	3.14		%	2.31		%	2.80		%	3.03		%	3.45		%
Net investment income	2.78		%	1.49		%	0.90		%	1.24		%	1.45		%	2.67		%

FOOTNOTES:

(1)The per share amounts presented are based on weighted average shares outstanding.

(2)Expense Support (reimbursement) is accrued throughout the year and is subject to a final calculation as of the last business day of the calendar year.

CNL STRATEGIC CAPITAL, LLC

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2025

(3)The amount shown at this caption is the balancing figure derived from the other figures in the schedule. The amount shown at this caption for a share outstanding throughout the period may not agree with the change in the aggregate gains and losses in portfolio investments for the period because of the timing of sales and repurchases of the Company’s shares in relation to fluctuating fair values for the portfolio investments.

(4)The per share data for distributions is the actual amount of distributions paid or payable per common share outstanding during the entire period; distributions per share are rounded to the nearest $0.01.

(5)The computation of average net assets during the period is based on net assets measured at each month end, adjusted for capital contributions or withdrawals during the month.

(6)Total investment return is calculated for each share class as the change in the net asset value for such share class during the period and assuming all distributions are reinvested. Class FA assumes distributions are reinvested in Class A shares and all other share classes assume distributions are reinvested in the same share class, including Class S shares which do not participate in the distribution reinvestment plan. Amounts are not annualized and are not representative of total return as calculated for purposes of the total return incentive fee described in Note 5. “Related Party Transactions.” See footnote (8) below for information regarding the percentage of total incentive fees covered by expense support by share class for all periods presented. Since there is no public market for the Company’s shares, terminal market value per share is assumed to be equal to net asset value per share on the last day of the period presented. The Company’s performance changes over time and currently may be different than that shown above. Past performance is no guarantee of future results. Investment performance is presented without regard to sales load that may be incurred by shareholders in the purchase of the Company’s shares.

(7)Actual results may not be indicative of future results. Additionally, an individual investor’s ratios may vary from the ratios presented for a share class as a whole.

(8)Amounts represent net investment income before total return incentive fee and related expense support as a percentage of average net assets. For the nine months ended September 30, 2025, approximately 10% of total return incentive fees for Class I were covered by Expense Support and none of the total return incentive fees for Class FA, Class A, Class T, Class D and Class S were covered by Expense Support. For the nine months ended September 30, 2024, approximately 7% and 5% of total return incentive fees for Class I and Class S, respectively, were covered by Expense Support and none of the total return incentive fees for Class FA, Class A, Class T or Class D were covered by Expense Support.

13. Subsequent Events

Distributions

In October 2025, the Company’s board of directors declared a monthly cash distribution on the outstanding shares of all classes of common shares of record on November 25, 2025 of $0.104167 per share for Class FA shares, $0.104167 per share for Class A shares, $0.083333 per share for Class T shares, $0.093750 per share for Class D shares, $0.104167 per share for Class I shares and $0.104167 per share for Class S shares.

Offerings

In October 2025, the Company’s board of directors approved new per share offering prices for each share class in the Second Follow-On Public Offering. The new offering prices are effective as of October 30, 2025. The following table provides the new offering prices and applicable upfront selling commissions and dealer manager fees for each share class available in the Second Follow-On Public Offering:

CNL Strategic Capital, LLC 10-Q